Bitcoin White Paper Anniversary – How the Future of Finance Is Faring
The Bitcoin White Paper was first published on October 31, 2008 by the pseudonymous Satoshi Nakamoto. In 13 years, the coin took the world by storm, rising in value from $0 to around $67,000 in the last quarter of 2021.
But what has changed in 14 years?
Aside from the exponential growth in Bitcoin’s price, the digital asset’s perception has also changed over the years since the release of “Bitcoin: A Peer-to-Peer” Electronically Cash System.”
From an investment standpoint, Bitcoin has been discussed as a hedge in the alternative asset class category, digital money for exchange, framed as “digital gold” by several crypto proponents, and equated with a risk asset due to its correlation to technology stocks.
All this as regulators address concerns about financial stability, security and money laundering in the virtual asset sector.
Regardless of where one stands on the coin, it can be agreed that Bitcoin became the poster boy for blockchain technology. So much so that its origins even reminded people of the late 90s and early 00s of the internet, or dot com.
In the white paper, Satoshi described Bitcoin as “a pure peer-to-peer version of electronic cash.” Not only did the paper propose “a solution to the problem of double spending,” the technology created a tamper-proof system for recording time-stamped transactions.
An idea for the digital world
Bitcoin also introduced an idea of a limited digital supply of 21 million coins to control inflation. The process is also accompanied by its four-year halving strategy to halve mining rewards and control supply.
And with everything introduced back in 2008, Bitcoin still maintains a dominance ratio of over 40% in the cryptoverse.
At the time of writing, Bitcoin has a market capitalization of less than $400 billion, with volumes of $24.7 billion at a price close to $20,600, and remains the top crypto by market capitalization.
Experts even pointed out that Bitcoin has glittered like gold in the market downturn, no more volatile than stocks or the British pound.
However, the innovation also has several critics. One of the significant opponents includes the economist Peter Schiff who has maintained that BTC will not be the saving grace in the midst of a potential recession.
On the contrary, BTC influencer and former chief market officer of crypto exchange Kraken, Dan Held, tweeted last year that BTC is massively undervalued relative to its utility.
Increasing need for King Coin
In 2022, the world may hate or love Bitcoin; they definitely can’t ignore it. In the crypto market, Bitcoin is known to be the most decentralized asset, essentially having the first-mover advantage.
The Layer 1 protocol also started many Layer 1.5 and Layer 2 projects after the release of the BTC White Paper. Stacks, for example, is another open source network of decentralized apps built on Bitcoin.
Last year, El Salvador became the first country to make Bitcoin legal tender, drawing the attention of global watchdogs. The IMF has continuously warned about the risks associated with the private crypto market.
While Bitcoin has accelerated a conversation about digital money owned by a community, the Bank for International Settlements (BIS) has collaborated on the wholesale and retail trade of central bank digital currencies (CBDCs).
As the globalized world looks for cheaper and faster cross-border transfers, the gap is mainly filled by P2P crypto transfers as seen by remittance data in developing countries.
Satoshi stated, “Transactions that are computationally impractical to reverse will protect sellers from fraud, and routine escrow mechanisms can easily be implemented to protect buyers,” elevating Bitcoin to become more than a secure medium for exchanging value.
It became a competition to the existing centralized payment system which led apex banks to update digital transfers.
Bitcoin Criticism Despite the Milestones
Despite its achievements, Bitcoin has increasingly come under critical evaluation for its proof-of-work mechanism that puts pressure on energy needs. Another feature of Bitcoin that concerned regulators was the level of privacy and anonymity with the algorithmic firewalls.
Concerns surfaced about the new technology with its anonymous creator. Over the years, several famous names have been speculated as the pseudonymous Satoshi Nakamoto.
Businessman and computer scientist Craig Wright is another self-proclaimed contender to be Satoshi. However, a significant part of the industry rejects his claims.
Crypto enthusiast Jim Basko recently claimed to have discovered Satoshi’s oldest Bitcoin code which is a reminder of over a decade long history of Bitcoin.
The first known crypto originated in 2009 as a result of the sub-prime crisis, followed by the infamous Bitcoin Pizza incident in 2010 that promoted it as a digital medium of exchange.
In the post-pandemic world of 2022, a new round of debates surrounding Bitcoin use cases during economic uncertainty has ignited, keeping the idea of Bitcoin alive for 14 years.
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