Other Open Decentralized Networks
Search Engines, Email, Social Networks. These could all be created in a similar fashion. They would cut out the big players that are making a huge cut in users online activities. If a community of servers could solve problems like search, social networks, shopping, almost any human to human interaction that we do with a computer. There could be nodes like “miners” in Bitcoin that would contain the correct answers for user queries. The network could intelligently organize any information and reward the organizers. An open source catalog could contain a valid list of the cheapest products that anybody could purchase. All of the computers would work together to locate the best available products for the lowest price. The network could connect commerce with consumers and cut out the costs of large third parties. The nodes that manage the network would be rewarded with commissions if they behave well. If they try to mess up the results, the rest of the network would find out and cut them out for new traffic immediately. This would be a decentralization of the network. Peer-to-peer networks work great for content sharing and currency, why isn’t it used for other popular online activities?
It is the internationalization of the web. People of any language will be able to communicate financially as well as through text and audio/video. You will have a store of wealth online that can easily be transferred to others at your whim. You will be free from corporations and governments limiting your freedoms. It will allow computing resources to be used just like a currency.
Online Activities Have Too Many Fees
An open and distributed network of e-books can be created to allow for publishers to connect directly with their readers. There is no need for corporations to have a monopoly on the system and take huge cuts. Some of the cuts that they take go to pay the banks the fees for their transactions. Bitcoin takes the banks out of the transactions between merchants and consumers. This model of centralized businesses is taking too much of the money away from the the merchants and consumers. The same principle can be applied to advertisements, e-commerce and search engines.
What happens after technology takes over finance? Is the next sight on politics? Will computers handle international laws just as they are starting to handle international financial transactions? There might be an autonomous system where there are an agreed upon set of laws. The system will be able to monitor all people and enforce the laws. There will be no single person or groups of people that can go around the the international laws. As scary as it sounds, this might be a good thing. The system would be much more efficient than the current system since there are so many loopholes and contradictions in laws across borders.
Will there be some blockchain technology that has all the laws that humans must abide by? The system could reward people that follow and uphold the law and it could punish people that do not follow the law. Having such a system in place might be better than the patchwork of laws that we currently have. Are there some undeniable truths about what it is right and what is wrong? If an alien civilization came to our planet, would there laws be nearly identical to our own laws? There are some many thoughts to ponder about what will happen with technology in general.
It will be useful for micro payments online. I personally like it for that. I like to pay $1 or so for goods. I wouldn’t give a company my credit card or bank information for such a small amount. I have been signed up for cycled billing for a minimum 12 months at $29. I should have read the terms and conditions. It would be harder for businesses to do that with bitcoin. They will be good for international orders also… the international credit card transactions sometimes fail and have to be manually approved. It is cheaper than the current services if you convert USD to bitcoin for free. Businesses usually pay about 3% CC fees and those are passed on to the customers. If the businesses/consumers could lower their prices by 3% for bitcoin customers, it would cut out the banks 3% fee for almost each and every transaction. It adds up after the same $100 gets a 3% transaction fee 10 times as the money spreads through the economy.
I don’t think an alt-coin will replace Bitcoin. It will have a small hash history and therefore be less mature. The new alt-coin would be worth about the same price as bitcoin in terms of computing power. Buying a crypto-currency will be directly proportional to how much effort it takes to create it. However, this will not hold true for alt-coins that die. If they get abandoned, then they will not be worth as much to a bitcoin in terms of computing power consumed in their generation. There will be cases where an alt-coin rewards more to mine than bitcoin. However, miners will switch their hardware to that alt-coin and then bitcoin will be easier to mine. This will enforce the price of all of the crypto-currencies to be balanced in the long-term. Some lucky people might get in early on some new alt-coins that will take off and it will be extremely profitable. But as soon as the price for an alt-coin starts rising, more miners will throw their equipment at it. Bitcoin is already “the” digital currency and it would be difficult for an alternative to surpass it.
Superior Digital Currencies
A currency that had all the abilities that Bitcoin has but was cheaper to mine would be superior. Is mining necessary? Is there a way to make a value exchange network that does not require such expensive computational power? A large network of trust might be able to be built where each node in the network receives a small reward for processing a transaction might be possible. However, the heat giving off from mining could be a valuable resource. This heat needs to be utilized in homes and businesses in areas that are cold.
Replacing Obsolete & Old Infrastructure
There are going to be battles replacing the obsolete & old financial infrastructure that is in place. They will take as much action as possible in court & media campaigns to continue maximizing their profits. Bitcoin offers new & improved services over the old.
To claim that Bitcoin can provide all the services of the Banks, Credit Card companies, PayPal, Western Union to name a few sounds crazy, but they all store and exchange wealth. Bitcoin is very effective at storing and exchanging wealth. The part about storing wealth might be argued against since people that bought at $1100 and now it is at $275, but that was an artificial spike and prices are correcting themselves to their true worth.