First and foremost, you need to know that I like cash. The feel of a real coin or a dollar bill in my hand is tangible and powerful. But the latest pandemic fears have us all worried about money transferring the Covid-19 virus; and that is a real fear.
Bitcoin is not as easy to use as credit cards and PayPal for most on-line purchases, although it works really well in person to person situations – because you can transfer money contactless with smartphones. This will get easier over time.
If you are at a store, and you don’t want to linger at the checkout or handle change, I would recommend using google or Apple pay. Some credit cards like chase also have contactless options. Many use the NFC (Near Field Communications) technology on most newer smartphones.
If you use cash, and get only change in return, I would suggest asking the cashier to put it into the charity box most stores have on the counter. that way you do not have to touch the change, and there is no increased risk of Covid-19 by touching a potentially contaminated item (physical money).
Cash Money won’t be going away, but in the time of Covid, alternatives to handling cash are necessary and may become more convenient than our customary cash transactions.
Cash Money, Change, Excitement, and Fear of the Unknown Bitcoin.
When the US Government redesigned the $100 bill, Banks all over the world were set on by people with American Money. They were seeking to change it to the new bills. To an American, this is silly. To people in other parts of the world, New money means the old money is (or will soon be) worthless. This has a historical context.
Money and value change constantly, and throughout history we have seen many currencies come and go. What of your Roman coins? Payment in round pebbles or carved stones? All were forms of currency that are no longer common or abandoned with the fall of the Empire.
Today we have seen the birth of a new form of money. You can’t feel it or carry it in your pocket. Electronic Currency has arrived. Conceptualized in a paper by the mysterious Satoshi Nakamoto, the creator of Bitcoin, the “gold Standard” of cryptocurrency.
Cryptocurrency, like any new form of money, has purpose. Proponents say it is the “next generation” of money and financial transactions. Since it is “peer to peer”, and can be transferred person to person directly, without passing through a central clearinghouse or central bank. Fees are low, and the transactions are immediate. OF course, when easy transfer of funds is available, a certain “sketchy” element of society (money launderers? Drug kingpins? Arms Dealers?) finds it attractive. Bitcoin achieved star status with Silk Road, a defunct website trafficking criminal materials and ungoverned commerce in prohibited (illegal) products. The US Government acquired 25 million Bitcoins in the aftermath of the criminal investigation.
Thus we see that Money is interleaved with governments, criminals, profiteers, history, and an underlying concern that your money may be worthless or converted to something else. No wonder proponents of bitcoin have the zeal of missionaries, and enemies of it are passionately opposed and eager to see the Bitcoin “house of cards” come crashing down. It is a fear that the current paper money might be as worthless as confederate dollars.
Bitcoin has survived almost four years. I don’t pretend to have a crystal ball, but instead of being afraid, I am going to enjoy the show.
Bitcoin purchases and transfers are “peer to peer” transactions. Using the Blockchain (the Bitcoin ledger system) no central clearinghouse is required to regulate any transaction; it occurs between two parties. The Blockchain is a transparent ledger that just records the transaction (in very simple terms). Individuals keep their Bitcoin in “Wallets” on smartphones or computers, or on specific websites that deal in currency transfers (like BTC to USD).
Governments regulate volume of money, interest rates, fee structures, and monitor it’s value against other fiat currencies. Financial transactions outside of government control (with no fees going to the monetary “gatekeepers”) are a nightmare for financial ministers everywhere.
In my opinion, Bitcoin is one component of the financial mechanism any government needs to work effectively. I am not convinced that cash (or precious metals) are going away anytime soon, but governments fear that losing their money-printing ability will weaken them considerably.
Banks and some governmental entities are scrambling to utilize blockchain technology, while publicly denouncing or denying Bitcoin as a monetary vehicle. Most notable among the nay-sayers was Jamie Dimon, of JP Morgan Chase.
Dimon himself has publicly said he sees potential in blockchain tech, and his company just announced this month the launch of a blockchain-based pilot to “significantly reduce” the number of entities needed to verify global payments, which would cut down transaction settlement times.
Countries with High inflation and unstable Fiat currency (Argentina, Venezuela, as examples) have seen Bitcoin transactions flourish as there are low or no fees, and Bitcoin valuation is more stable than the Fiat Currency.
Buying ICO’s and altcoins are like investing in IPO’s and Penny stocks.
Lots of potential reward, but real risk that you may lose up to all your investment. Many ICO’s are for coins that have no practical use (you can’t buy anything with them) – only an investment value that may plummet at any time. For Example, Bitcoin can be used to purchase goods and services from many established companies. Altcoins need to be on exchanges, where they can have a value equal to Bitcoin (BTC) and other coins, so the altcoins can be traded.
If the ICO price is low, You may want to accumulate some over time – adding to your position (or abandoning it) as your comfort level permits. Going “ALL IN” my be fun, but figuring where to start taking profit is a mystery, and many investors have watched their value climb, and then plummet, with little warning. Remember, any profit is good profit.
I strongly recommend that you don’t mortgage your house or max out your credit cards to invest in such unstable securities. Keep your head, study the market, invest with Money you can Afford To Lose. Some people use their Bitcoin profit to invest in Altcoins. Some altcoins have a social component, or are mined to benefit causes, like veterans (see Globalboost). If you are actively mining, see this Mining Profitability Calculator.