Money Dummy Vol 1: Bitcoin, What is it?
By: Warren R Barrett
Tags: Trends, Poverty, Bitcoin, What Is Bitcoin, Investing

Hello, I am middle-aged man living in America during 2020. Lately the internet is a buzz with the increase in value over bitcoin. But what is it? And how can it impact the its american citizens in surviving the economy post pandemic 2020.

https://www.investopedia.com Defines “Bitcoin is a digital currency created in January 2009 following the housing market crash. It follows the ideas set out in a whitepaper by the mysterious and pseudonymous Satoshi Nakamoto.1 The identity of the person or persons who created the technology is still a mystery. Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms and is operated by a decentralized authority, unlike government-issued currencies.”

What does that mean? Well technically Bitcoin is to Software, as the Dollar is to Gold, well that is until Richard Nixon took us off the gold standard in 1971. You see there are applications all over the world doing “work” and that work is paid for in bitcoin. As of today there are many options of applications that you can put on your computer or laptop that will earn you bitcoin.

Well what’s the challenge? Well on average if you have a powerful computer you could make about $8 a day via bitcoin software, but because of its popularity of mining it has already become saturated and it is harder to earn money, why?

Well the costs it takes to buy one of these powerful computers, the electricity spent to maintain it, and as more and more people get involved in the bitcoin process a type of inflation happens as the process becomes more difficult. One website claimed it was easier to make money a different way and just buy bitcoin watching its value increase as more people start investing in the bitcoin economy.

Yes, that means Bitcoin also works like a stock, as it’s a different type of investment you can make to watch your money grow. However I have to stop there because the value of Bitcoin is created by what its users are willing to trade it for and wont grow like a stock or act like one when it comes to growth and loss. As every time someone trades bitcoin for current currency its value is re supported, so as long as people keep exchanging bitcoin it has value. Sounds like money to me. So the above is a silly argument to make that it’s not a good investment, as with anything it should be taken with moderation and such decisions to invest shouldn’t be taken lightly.

I think it’s very neat that anyone with a computer can put software to work and make money. These days there will be apps that will ask you to take surveys and watch ads in exchange for bitcoin. These people doing work creating bitcoin are the true backbone of the money system. I imagine with Covid-19 in 2020 and a population still being unemployed more people will turn to earning bitcoin with the technology they possessed before the lockdowns.

I don’t think things will ever return to normal and I see a future of Uber, Doordash, and Postmates taking over as people abandon traditional jobs for the newer demands of society. I think like the new jobs, Bitcoin is here to stay and when tax time comes I plan on investing in bitcoin. For now I’ll continue to read about it and educate myself so that when I do have the disposable income to invest, for now I’ll start installing apps and see how much Bit I can make.

Thank you