Bitcoin: A band-aid for the Present Monetary System

The wave of bitcoin was introduced at a time when people were struggling to trust the financial ecosystem. With the fall of popular banks like Lehman Brothers announcing bankruptcy and government using tax payer's money to save banks from the bad investment decisions made by banks itself- led to an atmosphere of distrust. The financial crisis gave an alarming rise to unemployment and recession- with poor people suffering the most from it.

Img Source: https://www.thebalance.com/2008-financial-crisis-3305679

On the crisp of such crisis Satoshi Nakamoto introduced Bitcoin: a mechanism which is decentralized, peer to peer and without the need of intermediaries. The digital currency which works purely on the concept of mathematics and cryptography is unique due to the following reasons
The digital currency is completely decentralized- it does not have a central authority which controls the whole system. Therefore you won't need to trust the system- government or any central authority in order to use it. After the financial crisis, people lost trust on the government leading to the fall of prices in currency in many parts of the world. This is where the decentralized feature of bitcoin looks to be most attractive.

It works on a peer to peer system- which means that there isn't a higher authority. All the nodes (computers) running the network are at peers with each other without any one node controlling the system

In our present monetary system we need to rely on intermediaries like banks in order to practically carry out any small task revolving money. The present system does not give an alternate model to banks and so we don;t have any option but to rely on banks to maintain the ledger. One of the main reason attributed to the onset of financial crisis were bad loans/investments lent by banks. The digital currency takes the power of what to do with our money right out of the hands of banks. In case of bitcoin, we are the ones who control everything in terms of what happens with our money (or in this case bitcoin). There is no need to rely on intermediaries in order to operate or control our money.

And this is just the top of the iceberg! There are so many other important factors which make bitcoin different from the previous versions of digital currencies.
Stay tuned for our next post to learn more!
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