Binance Coin pros & cons with related info are in the collapsed comments below.
Below is a Solana con-argument written by Nostalg33k.
Solana: A tale of broken trust and VCsSolana, an infamous name living as the shadow of it former self Currently hovering at a price a bit higher than 10% of the ATH which is a shame for any investor. In this small analysis we are going to discuss why Solana is a failure on multiple fronts. From Security, to stability. Let's delve into Solana.
From outages to outragesSolana has been transformed into a laughingstock by the repeating outages the network has known. While it is claimed that Solana is all about speed, with 400 millisecond block times. And as hardware gets faster, so does the network. The Solana network has suffered 6 outages in the month of January Stability has not been the strong suit of the network. This has sparked outrage against the network but ALSO against some exchanges because these outages are leading big dumps on the markets: When speculator sell and lead to a 12 % dump the most dedicated investor are left holding their bags on the blockchain.
Every discussion about Solana as an investment should discuss the possibility of outages and swings.
The Main Use case is BullshitThe main use case for Solana is to sell useless no common sense NFTs. While there are good use case for NFT technology, art and music nfts as they exist are just a passing fad and will need to evolve or disappear. Being a place linked mainly with this technology is very risky and shows a devotion to speculation and not to common sense use cases.
Security: Hacks, hacks, hacks and VCsThe Solana ecosystem has known a lot of failures. The fact is that value is on the ETH side of the crypto ecosystem so bridges are required. When the Wormhole bridge saw a hack leading to 120000 ETH being minted out of the bridge leading to a loss which would be currently valued at 160 Millions.
When this happened Jump Crypto, a subsidiary from Jump Capital, found 320 Millions to buy ETH and replace the missing funds. This allows us to understand two possibilities.
1) Jump Crypto did this from the kindness of their heart
2) Jump Crypto did this because they are heavily invested in Solana and control a large part of the SOL moving around.
Now this may be speculation BUT recently Jump Crypto was said to be working to overhaul the open source SOL protocol for nodes. This leads to doubt about the legitimacy of the Solana Fundation and who controls the project.
https://protos.com/jump-crypto-forced-to-save-solana-with-320m-bailout-of-its-own-company/
https://thedefiant.io/jump-crypto-solana-overhaul
Conclusion: A lacking use case, a profit motive from VCs and a past of lacking security and stability must lead you to high caution.VCs are here to make money and they must be holding bags of Solana. If you buy some SOL you are putting yourself into their games and are now dancing with them. While NFT is the future for so many reasons (intellectual property, administration and so much more) the current use case are laughable and security will be at the forefront of gouvernements or IP management companies sending patents through your blockchain.
Being seen as an Eth killer, Solana is far from making the cut. I'd advise extreme caution. Please don't get burn't by this project.
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Below is a Solana pro-argument written by a deleted user.
PROsThis is the Pros section of my analysis on Solana
Low Transaction FeesSolana has very low transaction fees at about $0.0002 / transaction. They could still increase the fee schedule by ~40x before exceeding penny in cost. That's mainly because the fees are subsidized by staking rewards paid to powerful validators, which then contribute to ongoing SOL token inflation of ~7% as of 2022.
Moderately-high TPSThe true TPS limit of Solana over the past year after subtracting invalid transactions and vote transactions is about 400-600. It's not anywhere close to their marketed throughput of 50K TPS, but it's still moderately-high for a smart contract network.
Centralization is not as bad as the reputationSolana has a very bad reputation for being centralized as SQLana. It's actually not that centralized. There are currently 1900 validators, and the Nakamoto Consensus for shutting down the Solana network (needs 33% staked) is currently 33 validators.
On the other hand, there's almost no information about the identity of these validators, so it's still possible they're mostly centrally-owned by the foundation. We just don't know.
Outage and stability issues likely to be resolved by 2 upcoming updatesThe days of making fun of Solana for their outages could be coming to an end. Solana is working on 2 major updates that are meant to mitigate outages and provide stability to the network.
QUIC replaces UDP for Solana's IP and Transport layer protocols. QUIC provides flow control, allowing nodes to throttle incoming traffic when there's too much from both intentional and unintentional DoS attacks.
Localized Fee Prioritization allows Solana to dynamically charge higher fees for specific high-demand transactions. When a dApp or NFT project is congesting the network, the fee will rise for that app without affecting the rest of the network. This is a really cool solution I'd love to see other networks copy.
Lots of DeFi projectsThere are a ton of DeFi projects on Solana. It has 39 DeFi projects above $1M in TVL. DeFiLlama shows Solana at $1.4B in TVL, which puts it between Tron and Arbitrum at #6.
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Below is a Avalanche con-argument written by MDot_Cartier.
Seems to me like avalanche which was delayed by a sophisticated Ddos attack right off the bat is also going to be vulnerable to the same type of governance attack that allowed a hacker to steal $80 million dollars from beanstalk in mid april by using a flash loan which allowed him to buy a majority stake in beanstalk, and change the rules to send the $80 million to his account all within 13 seconds. If avalanche wants to be the backbone of multiple networks it needs to prove it is secure and I'm not sure it has done that to this point in time.
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Below is a Avalanche pro-argument written by a deleted user.
Avalanche is a relatively-new (only 1.5 years old) multi-blockchain crypto project whose token, AVAX, shot up into the top 10 cryptocurrencies by market cap in just 1 year. It has since fallen a bit.
It has 3 chains on its primary network (C-Chain, X-Chain, P-Chain) and many subnets. The C-Chain is the most-used chain and almost the only one that's used by exchanges.
I have a separate summary of Avalanche here that discusses the platform in more detail.
This post only lists the PROs
PROs
- The C-Chain uses an account model for transactions and is EVM-compatible. So it's easy for devs to create apps that bridge between EVM-compatible networks.
- The C-Chain EVM has many optimizations which make it much more gas-efficient than Ethereum. Most smart contract transactions cost pennies on the Avalanche network.
Low Transaction Costs
- C-Chain basic transactions (e.g. transfers/swaps) currently $.03-$.10 after the Crabada DeFi game moved to its subnet. This is way cheaper than using Ethereum (both before and after The Merge). Like Ethereum, the C-Chain also spam-resistant due to variable transaction fees. When the network was 30% congested while Crabada was running on the C-Chain, transaction fees were still only between $0.30 to $1.5 to execute.
- X-Chain and P-Chain transaction fees are fixed at a low 0.001 AVAX, which are currently $0.05 - $0.10 USD (Apr 2022). Both are spam-resistant because you'd need to spend over $1M USD / hour in transaction fees before they start seeing congestion.
- However, note that transaction fees are kept artificially low because validators are paid by staking rewards, which creates high inflation (over 10%) on the circulating supply.
High performance and speed
- Extremely fast finality: All 3 primary chains have an extremely-fast 1-2 second deterministic finality. Avalanche uses Snow, which is a fast BFT-like consensus protocol that uses a DAG structure for network gossip. Most other BFT-class blockchains have a moderately-slower 4-10s finality time.
- Moderately-fast TPS:
- C-Chain: Highest achieved TPS was 869 on the C-Chain, which accounts for over 99% of Avalanche transactions. This is already 50x higher than Ethereum's maximum TPS of ~16 TPS. The maximum TPS depends on the type of smart contracts it sees (300 bytes on average). Currently, the Avalanche C-Chain is only seeing 10-40 TPS because it doesn't get that many transaction requests. These are mostly from the Crabada game that's going to move into its own subnet.
- X-Chain: This is often quoted to be the 4500 TPS network of Avalanche (though it's quite misleading because this chain gets very little usage compared to the C-Chain). The X-Chain uses UTXO transactions and does not support smart contracts, so it's best compared to the Bitcoin network. 4500 TPS is orders of magnitude faster than Bitcoin's 5-7 TPS. In ideal test situations (150 nodes, 10kb blocks), the X-Chain can get up to 7000 TPS.
- P-Chain: The P-Chain is very similar to the X-Chain. Its purpose is for governance, staking, validators, and subnet management. Its 4500 TPS limit is way more than it will ever need.
- High uptime: Avalanche's primary network has had no outages. Aside from a brief minting bug in Feb 2022, it has not experienced any noticeable congestion.
Supports Application-Specific sidechains: Subnets
In addition, Avalanche uses subnets to build application-specific blockchains that connect weakly to its ecosystem.
- Subnets allows communities to create their own flexible sidechains that are loosely connected to the Avalanche's primary network. Subnets gain access to Avalanches infrastructure and framework, but not its security. They can have their own consensus model, decide the requirements for validators, be public or private, and have their own native token for transaction fees.
- Subnet validators must validate the Primary network, which in turns validates the 3 built-in networks. As the number of subnets grow, they will contribute to the overall security and decentralization of Avalanche's primary network (but not vice-versa).
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Below is an argument written by lj26ft which won 3rd place in the Ethereum Con-Arguments topic for a prior Cointest round.
Ethereum is being shown favoritism and privilege by US regulators. This is the biggest con for Ethereum. Early promoters of Ethereum approached and worked closely with the SEC to shield it from any securities laws. The arguments used by the SEC in the Ripple case can be more easily applied to Ethereum.
Why does Ethereum get a free pass from creating a securities offering? Because Joe Lubin started the Brooklyn project before Ethereum even launched. There's multiple threads on this very sub that shows they sold it to more than just developers. I find the hypocrisy and corruption to be the biggest con argument for Ethereum. It's being chosen by the incumbent system as the only standard for web3 so far. I don't think Ethereum would be as highly valued or trusted if it didn't have carte blanche on illegal fundraising/ hosting tens of thousands of illegal securities offerings.
The market needs to be a level playing field and right now it's heavily tilted towards Ethereum because of financial interests of early promoters, conflicts of interests from US regulators and their financial interests in Ethereum.
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Below is an argument written by Chysce which won 3rd place in the Ethereum Pro-Arguments topic for a prior Cointest round.
In its essence Ethereum is a platform that allows developers to create decentralized applications (dApps) using smart contracts. These contracts are self-executing and run automatically when certain conditions are met which makes them transparent and secure. With the recent Merge Ethereum has switched from proof of work to proof of stake which made the network even more secure and decentralized.
>> Deflationary Future
As a result of the Ethereum Merge event, the ETH tokenomics are now set up to become deflationary. For example only during last month supply of ETH decreased by 31.5k ETH due to more ETH being burned than issued. If Ethereum can consistently ramp up its user base and transactions over time, it will move closer to a deflationary future, which is increasingly likely given the growing DeFi and gaming ecosystems. The more transactions and people using ETH, the more it gets burned, which should theoretically make ETH more valuable going forward. Current supply decrease is 0.319% per year and the burn and is bound to increase with the use.
>> Staking
The upcoming Shanghai Fork will make liquidity readily available to stakers at any time, enabling them to have financial flexibility to build on top of it, as opposed to locking their ETH for extended periods. By staking ETH, one can manage it independently, with the assurance that no one can default on their investments, as it is secured on a smart contract. Since the start of staking program there has been a consistent rise in the amount of staked Ethereum. Currently ~15% of total supply of ETH is staked and APR is 4.5%
>> ETH is a DeFi powerhouse
Ethereum is the biggest platform for decentralized finance (DeFi) applications. The vast majority of DeFi applications are built on Ethereum, including decentralized exchanges (DEXs), lending and borrowing platforms, and stablecoins. Ethereum's popularity, tools and resources that are available to developers have significantlu contributed to the growth of DeFi on the platform.
While other blockchain platforms are also entering the DeFi space ETH will always have the first mover advantage and will be very hard to replace. At the moment the total value locked (TVL) in DeFi on Ethereum (58%) is greater than the TVL of all other blockchain platforms combined
>> Active Community
Compared to other ecosystems Ethereum has the biggest and most active community. It has the largest total number of developers, and this number is continuously increasing. Ethereum's community is known for being open-minded, welcoming, and inclusive. They are also very active in discussing and implementing future improvements
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Below is an argument written by lj26ft which won 3rd place in the Ethereum Con-Arguments topic for a prior Cointest round.
Ethereum is being shown favoritism and privilege by US regulators. This is the biggest con for Ethereum. Early promoters of Ethereum approached and worked closely with the SEC to shield it from any securities laws. The arguments used by the SEC in the Ripple case can be more easily applied to Ethereum.
Why does Ethereum get a free pass from creating a securities offering? Because Joe Lubin started the Brooklyn project before Ethereum even launched. There's multiple threads on this very sub that shows they sold it to more than just developers. I find the hypocrisy and corruption to be the biggest con argument for Ethereum. It's being chosen by the incumbent system as the only standard for web3 so far. I don't think Ethereum would be as highly valued or trusted if it didn't have carte blanche on illegal fundraising/ hosting tens of thousands of illegal securities offerings.
The market needs to be a level playing field and right now it's heavily tilted towards Ethereum because of financial interests of early promoters, conflicts of interests from US regulators and their financial interests in Ethereum.
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Below is an argument written by excalilbug which won 1st place in the Ethereum Pro-Arguments topic for a prior Cointest round.
Ethereum has been one of the top coins for more than 6 years now. And there are several reasons why it’s so popular:
- Reliability
Launched in 2016, Ethereum has been very reliable. Some networks (e.g. Solana) had more issues in single week than Ethereum in all its history. The only issues I can remember is of course the famous hack (it was in the beginning of ETH) that led to the creation of ETH Classic and the network congestion in 2017 caused by… internet cats. What else could it be, right?
Other than that ETH remained very stable and trustworthy. It had no downtimes and new partners were joining the network which led to the next pro of Ethereum:
- Adoption
One of the biggest advantages of Ethereum is its widespread adoption. It had the first mover advantage and it used it pretty well. Today the Ethereum Enterprise Alliance includes dozens of members, among them such big names as JP Morgan, Ernst & Young or Microsoft
Every regular visitor to r/cryptocurrency is also probably aware that Reddit chose Ethereum for their community points program. Currently Moons run on one of Ethereum layer 2 protocols called Arbitrum Nova
Also worth mentioning is the fact that the total value locked on Ethereum network is almost 60% of all chains and almost 6 times more than its biggest competitors, Tron and Binance chains (both “just” 10%)
- Advantages of PoW -> PoS transition
Transition from PoW to PoS of course has some disadvantages (the rich get richer) but it’s hard to deny that there are also some advantages. And probably the biggest one is the energy usage decrease. The energy used by Ethereum is now almost 100% lower than when it was a PoW coin
The other advantage of recent updates is the fact that ETH is now deflationary. After the implementation of EIP-1559 ETH now burns a fraction of the gas fees per transaction (so there are some positive sides to high fees too – more ETH is burned :P). This year, in less than 3 months, more than 66,000 ETH was burned
And it’s not the end. Soon, on 12 April 2023, ETH will have another upgrade called Shanghai-Capella (Shapella). One of its improvements is EVM Object Format. It will separate code from data. It should make the network easier to use and it will reduce gas fees
- Layer 2 solutions
One of the biggest problems of Ethereum are high gas fees. But thanks to a very active community and smart develoeprs this problem is circumvented. Layer 2 protocols have very low fees while utilizing the benefits of Ethereum blockchain. They decrease data traffic by redirecting it offchain
Those layer 2 solutions are so popular that Arbitrum has 4th largest total value locked in it and Polygon and optimism are 5th and 6th respectively! (https://defillama.com/chains)
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Below is a Solana con-argument written by Nostalg33k.
Solana: A tale of broken trust and VCsSolana, an infamous name living as the shadow of it former self Currently hovering at a price a bit higher than 10% of the ATH which is a shame for any investor. In this small analysis we are going to discuss why Solana is a failure on multiple fronts. From Security, to stability. Let's delve into Solana.
From outages to outragesSolana has been transformed into a laughingstock by the repeating outages the network has known. While it is claimed that Solana is all about speed, with 400 millisecond block times. And as hardware gets faster, so does the network. The Solana network has suffered 6 outages in the month of January Stability has not been the strong suit of the network. This has sparked outrage against the network but ALSO against some exchanges because these outages are leading big dumps on the markets: When speculator sell and lead to a 12 % dump the most dedicated investor are left holding their bags on the blockchain.
Every discussion about Solana as an investment should discuss the possibility of outages and swings.
The Main Use case is BullshitThe main use case for Solana is to sell useless no common sense NFTs. While there are good use case for NFT technology, art and music nfts as they exist are just a passing fad and will need to evolve or disappear. Being a place linked mainly with this technology is very risky and shows a devotion to speculation and not to common sense use cases.
Security: Hacks, hacks, hacks and VCsThe Solana ecosystem has known a lot of failures. The fact is that value is on the ETH side of the crypto ecosystem so bridges are required. When the Wormhole bridge saw a hack leading to 120000 ETH being minted out of the bridge leading to a loss which would be currently valued at 160 Millions.
When this happened Jump Crypto, a subsidiary from Jump Capital, found 320 Millions to buy ETH and replace the missing funds. This allows us to understand two possibilities.
1) Jump Crypto did this from the kindness of their heart
2) Jump Crypto did this because they are heavily invested in Solana and control a large part of the SOL moving around.
Now this may be speculation BUT recently Jump Crypto was said to be working to overhaul the open source SOL protocol for nodes. This leads to doubt about the legitimacy of the Solana Fundation and who controls the project.
https://protos.com/jump-crypto-forced-to-save-solana-with-320m-bailout-of-its-own-company/
https://thedefiant.io/jump-crypto-solana-overhaul
Conclusion: A lacking use case, a profit motive from VCs and a past of lacking security and stability must lead you to high caution.VCs are here to make money and they must be holding bags of Solana. If you buy some SOL you are putting yourself into their games and are now dancing with them. While NFT is the future for so many reasons (intellectual property, administration and so much more) the current use case are laughable and security will be at the forefront of gouvernements or IP management companies sending patents through your blockchain.
Being seen as an Eth killer, Solana is far from making the cut. I'd advise extreme caution. Please don't get burn't by this project.
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Below is a Solana pro-argument written by a deleted user.
PROsThis is the Pros section of my analysis on Solana
Low Transaction FeesSolana has very low transaction fees at about $0.0002 / transaction. They could still increase the fee schedule by ~40x before exceeding penny in cost. That's mainly because the fees are subsidized by staking rewards paid to powerful validators, which then contribute to ongoing SOL token inflation of ~7% as of 2022.
Moderately-high TPSThe true TPS limit of Solana over the past year after subtracting invalid transactions and vote transactions is about 400-600. It's not anywhere close to their marketed throughput of 50K TPS, but it's still moderately-high for a smart contract network.
Centralization is not as bad as the reputationSolana has a very bad reputation for being centralized as SQLana. It's actually not that centralized. There are currently 1900 validators, and the Nakamoto Consensus for shutting down the Solana network (needs 33% staked) is currently 33 validators.
On the other hand, there's almost no information about the identity of these validators, so it's still possible they're mostly centrally-owned by the foundation. We just don't know.
Outage and stability issues likely to be resolved by 2 upcoming updatesThe days of making fun of Solana for their outages could be coming to an end. Solana is working on 2 major updates that are meant to mitigate outages and provide stability to the network.
QUIC replaces UDP for Solana's IP and Transport layer protocols. QUIC provides flow control, allowing nodes to throttle incoming traffic when there's too much from both intentional and unintentional DoS attacks.
Localized Fee Prioritization allows Solana to dynamically charge higher fees for specific high-demand transactions. When a dApp or NFT project is congesting the network, the fee will rise for that app without affecting the rest of the network. This is a really cool solution I'd love to see other networks copy.
Lots of DeFi projectsThere are a ton of DeFi projects on Solana. It has 39 DeFi projects above $1M in TVL. DeFiLlama shows Solana at $1.4B in TVL, which puts it between Tron and Arbitrum at #6.
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Below is an argument written by Nostalg33k which won 3rd place in the Bitcoin Con-Arguments topic for a prior Cointest round.
Bitcoin, could it be wrong. "Are we the bad guys ?"
In this small write up, I am going to delve into con-arguments against Bitcoin. Bitcoin is the flagship of cryptocurrencies but there are a lot of criticism that could be leveraged against Bitcoin. First of all, let's delve into a small presentation of Bitcoin.
Bitcoin: An introduction.Bitcoin is the biggst cryptocurrency. It was created by a mysterious figure. The creation of Bitcoin is a strange and mysterious mystery. No one knows who created Bitcoin.
Bitcoin was started as a way to circumvent traditional banking. Bitcoin relies on blockchain technology. Blockchain can be seen as an open book allowing anyone to know where is each fraction of Bitcoin ever.
This blockchain is maintained through computer power. In a vulgar way: Bitcoin is mined by solving math problems. The maths problem becomes harder when more people are mining so that mining takes a fixed amount of time according to a timeline known to everyone. In order to respect this timeline, mining rewards are halved every few years.
Since anyone who wants to validate transactions is forced to complete a very hard math problem (which becomes harder the more people are mining), no one can cheat in new transactions. Also, every other miner has a copy of the blockchain. Through making sure that no entity has 50% of the mining, you can stop nefarious actors from changing the blockchain.
This is using cryptographic technology that I don't yet understand but you can read more about it here:
Bitcoin Wikipedia
Without delving more into the tech side of bitcoin. Which can also be explained through youtube videos here: Bitcoin explained
The Metrics of Bitcoin are currently: 22400$ Per coin for a Market cap of 430 Bilions and a daily volume of 19 Billions. Bitcoin was shortly valued at 69000 usd during the ATH.
Now let's dive into what is making Bitcoin so bad.
Permissionless: A senseless destruction of world order.Bitcoin is a project existing in a very delicate world balanced by power structure. While we can be happy that the current top dog is the US (yes they are not perfect BUT they could be worse) we know that someone else could be on top. Despite that, we should strive to use the current US dominance to curb rogue states into the world order.
The current war in Ukraine is a demonstration of the world order crumbling to maintain itself. I'd argue, the rise of cryptocurrencies may be a part of this crumbling. In fact, I'd go as far as to say that, Bitcoin replacing the US Dollar would usher a chaotic age of international relation.
The world has shrank a lot since the rise of internet. The fact is that the stability of the world is much more precious than ever. Everyone can see what happens in any other country and how the supply chains which guarantee our comfort are of the utmost importance. YET, we are pushing forward a great disrupter of balance.
Permissionless can help terrorists, permissionless can help crime. YES traditionnal banking is doing it already BUT I'd argue that the absence of regulator and watchdog to make the current system comply is not an argument in favor of a tech which will make regulation and surveillance harder.
Bitcoin: This MONEY Doesn't Work, This Money Doesn't WORK.Bitcoin is claiming to be a currency. A viable alternative to fiat money. But anyone with a neuron or two could realize that the fluctuation in the value of Bitcoin is crazy. Some pedentic nerd and bitcoin maximalist could argue that 1 BTC = 1 BTC BUT if you don't know how much you'll need to put food on the table then BTC is not working as a currency. Yes inflation is lowering the value of Fiat BUT fiat doesn't see wild swings of + or - 30 % in most economies.
While not being really MONEY I'd argue that Bitcoin doesn't WORK. To work the economy needs money to move. 100$ could buy groceries then be used to pay the local brewery, the butcher and many more people before going back to a bank account. This movement has created economic vitality. Bitcoin, most of the time, is seen as an investment vehicle such as gold. I'd argue that these vehicle are not valuable for society since the freeze money in place.
In a bank, your money is working. Instead of Bitcoin, people should be paid more by banks to put their money in investment portfolios since these provide the liquidity necessary to make the economy work.
Bitcoin: A very big spending of energy.
Bitcoin is a project which is wasting a lot of ressource for something which is not making a lot of sense. While Bitcoin is using more and more green energy, I'd argue that it is still a big waste. Subsidies could prop up the green sector far better than the mining farms that go with windfarms.
Seeing Bitcoin as one of the biggest leverage of the green sector is a non-sense. Optimization of the energy sector means that the variable production should allow to reduce the use of fossil energy. Not allow to waste energy in a senseless project.
Conclusion: The harsh truth is, we may be the bad guys.Partaking in an economic sector which allows for a disruption of world order, which doesn't help the economy and which is wasting energy may not be beneficial. This is why Bitcoin should not be seen as a messiah of economic proportion but as something which should raise criticism and should be heavily regulated.
Good luck in your investments.
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Below is an argument written by CreepToeCurrentSea which won 3rd place in the Bitcoin Pro-Arguments topic for a prior Cointest round.
Bitcoin is a peer-to-peer digital currency that can be transferred via the bitcoin network. Bitcoin transactions are cryptographically verified by network nodes and recorded in a public distributed ledger known as a blockchain. The cryptocurrency was created in 2008 by an unknown individual or group of individuals using the alias Satoshi Nakamoto. (1)
PROsIt's Decentralized
- Decentralization is the process through which an organization's operations are disseminated or delegated away from a central, authoritative location or group, specifically those related to decision-making and planning (2). One of the core assets of Bitcoin is that it is decentralized meaning:
- No need for a central authority
- No need for centralized servers (peer to peer network)
- Ledger is distributed and public
- Anyone can be a bitcoin miner
- Anyone can create a bitcoin address
- Anyone can do a transaction without needing approval from a centralized source
Provides Privacy
- Bitcoin is a pseudonymous currency, which means that funds are not connected to real-world entities but rather to bitcoin addresses. If you were to own a bitcoin address, there would be no known connection between your identity and that of the address but all transactions will be public. Although it is possible (but hardly) that bad actors may identify your address via correlating the transactions you made, you can increase privacy by creating another address.
Security
- Bitcoin operates through what is called a Proof of Work algorithm which is a type of cryptographic proof in which one party (the prover) demonstrates to others (the verifiers) that a specific amount of computational effort has been expended. In Bitcoin, miners compete to append blocks and mint new currency, each miner experiencing a success probability proportional to the computational effort expended. Miners in Bitcoin are tasked to validate a transaction by solving a complex problem. The total combined total computational power of these miners combines is what's called a Hashrate. The hashrate is an important metric for assessing the security of the network. The more machines dedicated to discovering the next block by honest miners, the higher the hashrate rises and the more difficult it becomes for malicious agents to disrupt the network. (3, 4, 5)
Scarcity
- There will only be 21 million Bitcoins in existence, once all of Bitcoin has been mined there will no more issuance of new Bitcoins and this give it this certain trait of scarcity like precious metals without the difficulty of portability and also the same traits of durability. (5, 6)
The Coin that Started it All
- By this time everybody knows why and how Bitcoin, how it's mysterious maker just vanished from the scene and how it's purpose still echoes as a reminder that power of self-custody is never too late to remove ourselves from being too dependent of centralized bodies that often times go beyond what we allow them to do. To this day, Bitcoin still stands as number one coin (by marketcap) and will probably stay that way for a very long time.
Sources:
https://bitcoin.org/bitcoin.pdf
https://www.merriam-webster.com/dictionary/decentralization
https://en.wikipedia.org/wiki/Bitcoin#Decentralization
https://en.wikipedia.org/wiki/Proof_of_work
https://www.coindesk.com/tech/2021/02/05/what-does-hashrate-mean-and-why-does-it-matter/
https://www.investopedia.com/ask/answers/100314/why-do-bitcoins-have-value.asp
https://www.investopedia.com/tech/what-happens-bitcoin-after-21-million-mined/
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