Investors' view on the development trend of digital currency: a new starting point for the development of Bitcoin and the rise of blockchain technology

I think the old people in the cryptocurrency circle remember that the loudest slogan in the cryptocurrency circle at that time was to overthrow the legal currency. It seemed that the day when Bitcoin would dominate the world's finance was just around the corner. Then Hayek's theory of free currency was mentioned again and again by theorists in the cryptocurrency circle as a model of citing classics. The bankers and central banks were in a state of panic (actually imaginary). To be a die-hard, you must be a liberal and have a little utopian spirit. It is impossible to be thorough. So I have always been very surprised that I have not been able to be thorough. It is obviously speculation, why can it be so high-sounding? Maybe from another perspective, speculation without high-sounding reasons is not a successful speculation. Every time I argue in various groups, the one who is finally knocked down is often like this. 100 years ago, could you imagine cars running all over the streets! 20 years ago, could you imagine the scale of the Internet today! So let it be, it is much better than being compared to pyramid schemes, Ponzi schemes, and tulip bubbles.

After that, the United States held a hearing on Bitcoin, and Bitcoin soared to 8,000 RMB. Five Chinese ministries issued a notice to curb speculation. 800,000 BTC disappeared from the Japanese Bitcoin trading website MT-gox, and Bitcoin entered a long bear market. However, the bear market did not stop the development of Bitcoin. More and more companies support Bitcoin payments, including Microsoft, Dell, and more top payment companies, top Internet companies, and Internet business empires. Venture capital has also invested heavily in Bitcoin startups, and the amount has not been less than 800 million US dollars so far. (Since 2012, there have been 142 financing/merger and acquisition events in the Bitcoin startup field, with a total financing amount of 892.0232 million US dollars, including 38 in the exchange field, 9 in the blockchain field, 17 in the mining field, 16 in the wallet field, and 62 in other fields. The above data comes from Bitcoin Ventures) There are many top business leaders who have joined the layout out of their own pockets.

But I have always been confused about where the way out for Bitcoin is. I think, since they keep talking about the development of technology, then this rebellious and radical idea of ​​overthrowing the old system is definitely not the right way to develop. Where is the way forward for Bitcoin?

Theory often precedes technology. I was inspired by an article at the end of 2014. IBM: Bitcoin blockchain technology will be the core to solve the defects of the Internet of Things. Paul Brody, vice president of IBM Global Business Consulting Services, said in the article: "The core of the Internet of Things solution is blockchain technology, which is the underlying technology of Bitcoin." Bitcoin blockchain and the Internet of Things, the perfect combination of the digital field. Will this be the trend of the future?

Coincidentally, not long ago, the cryptocurrency community began to discuss whether to use blockchain or Bitcoin. In fact, this discussion is meaningless. It is definitely necessary to use both. However, the signs have emerged that blockchain technology, as the core technology of Bitcoin and the technology behind Bitcoin, is about to shine. At the end of the discussion, I saw a core summary, "It is not the competition of coins but the competition of chains."

Soon after, creative technical programmers expressed their intention to set up blockchain startups. Then venture capital firms began to invest in blockchain companies. Then, relevant media reports on blockchain began to dominate the news.

Someone may ask, isn't blockchain Bitcoin? Anyway, everyone who knows Bitcoin knows blockchain, and Bitcoin is built on blockchain, so what is the relationship between them? It's very simple. I will tell you the top ten blockchain technology industry application directions currently summarized.
1. Payment. This is Bitcoin and other currencies.

2. Internet of Things. Currently led by IBM, many startups are also developing it.

3. Large transaction volume blockchain confirmation technology. This should be considered an upgraded version of Bitcoin technology to meet the high-speed growth in the future.

4. Decentralized cloud storage: An upgraded version of cloud storage.

5. Securities trading. Nasdaq has made a high-profile announcement. If you don’t know about it, you’re out.

6. Decentralized domain name servers. Is this going to upgrade the Internet?

7. Authentication and management.

8. Digital asset management.

9. Supply chain.

10. Solutions to volatility in digital currencies.

Some people may question: How can blockchain be included in the top 10 applications? Then let’s take a look at what blockchain technology is.

Various viewpoints:

1. The traditional Internet is a "center-decentralized-center" structure, but it is essentially a centralized structure; while the blockchain is a "decentralized-center-decentralized" structure, which is closer to the wisdom of nature.

2. Blockchain technology provides a new solution to the Byzantine Generals' Problem, which is mathematically unsolvable.

3. Blockchain is a new decentralized protocol system that can store transactions or other data securely without the need for review by any centralized organization, because these are verified by the entire network. Those transactions are not necessarily financial transactions, and the data is not necessarily currency. Blockchain technology can be used in many applications...

4. IBM said that the company has invested massive resources in the Internet of Things, and blockchain technology is the key to solving some of the core problems - each device must be able to manage itself, so that there is no need for frequent manual maintenance - this means that the operating environment of the devices should be decentralized, and they are connected to each other to form a distributed cloud network.

The above view comes from Will blockchain replace the Internet in the next ten years?

Blockchain is a public, decentralized ledger technology that carries all Bitcoin transfer transaction records. Blockchain is now widely regarded as the "future of financial services infrastructure." Blockchain technology can be seen as a public ledger that contains a list of all historical transaction records and can bind the owner of the ledger to his or her historical and current transactions.

The essence of blockchain technology is a decentralized method of data storage, transmission and certification based on a distributed structure. It replaces the current Internet's reliance on central servers with data blocks, so that all data changes or transaction items are recorded on a cloud system. In theory, it realizes the self-certification of data during data transmission. In a far-reaching sense, this goes beyond the traditional and conventional information verification paradigm that requires reliance on the center, and reduces the cost of establishing global "credit". This peer-to-peer verification will produce a "basic protocol", which is a new form of distributed artificial intelligence, and will establish a new interface and shared interface between human brain intelligence and machine intelligence.

Let’s take a look at what big companies are doing.

1. Nasdaq wants to use blockchain technology to replace this "Nasdaq process".

2. Deloitte, one of the Big Four accounting firms, is using blockchain technology for automated auditing.

3. Financial giants such as Citigroup and UBS are also beginning to experiment with blockchain technology.

4. IBM is currently developing a blockchain-based IoT system called Adept, which will be low-cost, reliable and efficient.

5. Even Russian President Vladimir Putin has said that using digital currency as a currency may be problematic, but using digital currency as a unit of account is possible.

There are many more examples, which I will not list here one by one. Those who are interested can search for them themselves.

Let’s break down the technical features of blockchain, which may help you understand.

1. Decentralization, peer-to-peer, and distributed. To put it simply, it is what we used to call P2P. How to achieve it? It is nodes. N nodes that are unrelated and not controlled by someone or an organization build a distributed network.

2. Public ledger. To put it simply, it is an encrypted database, which cannot be tampered with because of encryption and decentralization. That is, each node has a record, and you cannot deny it, which becomes a credit system. Of course, how to lock you in is a problem that needs to be solved in the next quarter. Database, so storage is not a problem. With storage, verification, proof, etc., it is not a problem. How wide is the scope of public ledger? Bank money transfer is a ledger, company finance is a ledger, your various monthly expenses are ledgers (various fees and tax payments), and real estate registration can be a ledger. In addition to money, everything that can be digitized in the future may become part of the ledger. Digitalization means that everything that can enter the computer can be digitized. What a big market this is!

3. Smart. How to make it smart? This is a question that programmers consider. Ethereum said, I want to develop smart contracts. IBM said, I want to develop smart contracts, I open source, I free. That's right, smart contracts will be modular software in the future.

Someone is going to ask me again, what is the purpose of your exaggeration? I solemnly declare that I am an investor and I have always maintained a serious research attitude. The following are some of the projects that I think are relatively good. Of course, this is just my personal opinion and does not constitute investment advice.

1. Factom. Factoids is a transaction currency in the Factom network, also known as fct. Factom is committed to building a data layer on the Bitcoin blockchain. The project has received widespread attention worldwide. The Factom team also worked with the Honduran government to design a land ownership record system for them. The team also provided technical advice to the United Automobile Association (USAA). It has successfully raised $1.1 million in financing and obtained money through factoids crowdfunding. Money makes things easier. The current market price of Factoids is 52,000 satoshis.

2. Ant. The first round of crowdfunding was launched on October 20, 2015. The founder, Da Hongfei, is a famous figure in the domestic blockchain industry. Ant is an electronic contract signing system. Ant uses blockchain technology to complete asset registration, transfer transactions, and clearing and delivery. By digitizing assets, the property rights of any physical assets can be made programmable. The atomic-level transactions and real-time delivery characteristics of blockchain technology greatly reduce the operating costs and ecological chain of securities trading. We believe that Ant not only has an overwhelming advantage over the traditional financial system, but will also create a new digital financial ecology. Participate in crowdfunding to get Ant shares, and get Ant coins according to the proportion of Ant shares held. Ant coins are used to pay for the use of the Ant system. Ant shares and Ant coins can be traded.

3. Tilepay. Provides a payment solution for the existing Internet of Things industry from people to machines or machines to machines. In October 2014, it raised 542 BTC through crowdfunding and issued the digital currency Tilecoinx, referred to as XTC. Development direction: Blockchain Internet of Things, which was launched almost at the same time as IBM. The founder, Canadian, Shwan, participated in the Nantong Smart Building Entrepreneurship Competition in August 2015. Tilepay will also establish an Internet of Things data trading market so that everyone can buy data from various devices and sensors in the Internet of Things. And ensure the secure transmission of data and payments in a peer-to-peer manner. (I think this is the profit point of Tilepay. According to reliable information, it has made a lot of money by mixing faces, but it is not disclosed, saying it is a trade secret.) In the last update, Shawn said that he would join Ethereum, but of course he would not abandon the big brother BTC. Domestic community group number: 314611592. The current price is 800 satoshis. Equivalent to 1 cent and 5 cents.

In addition, the above three projects also participated in the first global blockchain summit in 2015. Factom's keynote speech: Applications based on Bitcoin blockchain. Tilepay's keynote speech: Blockchain: Internet of Things: M2M. Xiaoyi participated in the theme discussion: Future trends and scalability of blockchain technology.

About the 2015 World's First Blockchain Summit:

The conference is hosted by WanXiang Blockchain Labs, a non-profit cutting-edge research institution focusing on blockchain technology. The main sponsors are肖风, Vice Chairman and Executive Director of China Wanxiang Holdings Co., Ltd.,沈波, an investor in the field of blockchain technology, and Vitalik Buterin , an Ethereum developer. The conference will invite technical geeks, entrepreneurial elites, academic experts, investors, financial institution representatives and regulatory decision makers from the global blockchain field to discuss the commercial applications and development prospects of blockchain technology in many industries such as payment, Internet of Things, securities trading, and digital asset management.