Letter to the Editor: Why Bitcoin?

This letter was submitted and approved by Andrew Chong.


Andrew Chong

Bitcoin, also known as BTC, was introduced in 2009 by an anonymous developer under the pseudonym Satoshi Nakamato. The coin is a virtual currency, much different from gold and U.S. dollars. BTC was designed to remove the need for third-party involvement when making transactions, as it’s not controlled by banks or authorities. Bitcoin is the earliest virtual currency and its widespread popularity has jumpstarted the creation of other cryptocurrencies. Currently, Bitcoin is the most well-known cryptocurrency in the world.

Bitcoin was built on a distributed digital record called a blockchain. A blockchain is a system of recorded information that makes it almost impossible to change. These exist on a public ledger that anyone can view, with the information of the dates and times a transaction was made. Blockchains are secured by encryption methods and codes, ensuring secure transactions without the fear of hackers. However, blockchain technology makes it difficult for someone’s transactions to be reversed.

Just like gold, silver, and the dollar, Bitcoin is a currency. What makes Bitcoin different from other currencies is how it’s decentralized. Decentralization means you have control of your money, and there is no single entity that controls the network. Bitcoin is controlled by its owners whereas cash is controlled by the banks. When your money is being stored in a bank, your money can be loaned out to other people and businesses. Banks also receive interest payments from the loans taken out by borrowers. As for Bitcoin, none of this happens. You are the only one in control of your money – no government or institution uses your money behind your back.

Although a complicated and complex topic, once you understand the basic foundations of Bitcoin and what it is and how it works, you’ll start to recognize the uniqueness of the currency and the idea around it.