Quote:
Originally Posted by Crowbob
Can somebody explain to me in second grade English, first grade math and primary school computer what cryptomining, or whatever it is, is?
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The best analogy is gold, and the computer techniques are designed a bit around mining gold. That is why it's called "mining". So, gold is difficult to mine. It's not common, you have to take a lot of dirt out of the ground in order to get a small amount of gold. It's the same thing with "mining" crypto. The designers of the system made it difficult to mine so that earning "coins" would take some serious effort (and electricity), and would make the system non-inflationary. I.E. if gold mining was easy, there would be lots of gold, and due to supply/demand relationships, its value would go down.
In addition to the mining aspect of this system, there is also something called the blockchain, which is nothing more than a record of all transactions from the beginning of time. So when Bob sends some Bitcoin to Joe to pay for a pizza, the transaction is recorded in this ledger (blockchain), and then replicated all over the world to all of the computers currently mining and processing bitcoin. This is a little bit like the setup of how Napster worked in the old days - and stuff working on BitTorrent - where a large movie or music album file is broken up and distributed amongst a large number of computers (pirates). No one person controls the file, and it's all decentralized.
Miners and processors are paid in Bitcoin to maintain the network and keep copies of the blockchain ledger.
This system was all designed by someone or some group called Satoshi Nakamoto. This person or group posted the whitepaper and code for Bitcoin a long time ago, but has since disappeared. It's pretty much undisputed by *anyone* (friend or foe of Bitcoin), that this whitepaper and resulting system is one of the greatest innovations of our time. Again, even the Bitcoin haters respect the concept and the genius of the original idea.
Having said that, it is my opinion that Bitcoin is simply version 1.0.0 of this brilliant idea, and like nearly every brilliant initial idea, it has it's major flaws, and needs to be improved upon. The system is relatively closed and highly deflationary - meaning that it doesn't adjust well to new funds and new demand coming in (or going out), and thus becomes insanely volatile, as we have seen just today. Another major flaw, and perhaps it's largest, is that it's proof-of-work foundation (the actual process of mining), is difficult for computers and takes a lot of energy. LOTS of energy. Thus, it has a built-in flaw that will prevent it from being adopted by anyone outside of the "fringe financial markets". Again, just my opinion - there are many who agree, and many who disagree with this assessment.
Just to repeat, I believe the technology and innovation is amazing in concept, but Bitcoin, again, is version 1.0.0 and will go down in history with its place right next to Netscape Navigator, AOL, and MySpace (all of which were absolutely stunning innovations at the time). The true thing to watch for will be version 3.0 of crypto (version 2.0 is Ethereum, which has an expanded feature set when compared to Bitcoin, but still suffers from the volatility and energy usage problems).
If I were to take a wild guess, I would think that Cardano ADA would be the 3.0 version that everyone is looking for:
https://www.investopedia.com/cardano-definition-4683961
Hope this helps. Feel free to correct my facts (not my opinions) if I got something incorrect!
-Wayne