Chris' note: Today, James joins us to talk about the #1 biggest opportunity in cryptoland for the next five years… and how to get ahead of the curve with one under-the-radar crypto project. Read on. The Five-Year Crypto Plan James Altucher It goes without saying that understanding blockchain is incredibly complicated. As comedian John Oliver put it, "Cryptocurrency combines everything you don't understand about money, with everything you don't understand about computers." For most people, it's good enough to understand things at a high level. Of course, there's lots of money to be made from understanding all of the tiny details and the opportunities they create. But unless you're a software developer working on blockchain full-time, chances are slim that you'll get to this level of complexity. Fortunately, blockchain is so intimidating and complex, that most people don't understand it even at a high level. This creates an opportunity to make money that 99% of people aren't even aware of. One of the biggest opportunities coming in the next 5 years will be staking. You probably already know at a high-level how Bitcoins are mined. Bitcoin (and other cryptocurrencies) use what's known as a distributed ledger. Rather than the bank keeping a record of how much money you have deposited, distributed ledger works by having a network of computers maintain that record. You can think of this as a big Google doc that everyone can see, but only certain people can edit if they have the proper permission. However, with distributed ledger, there is no trusted institution. The records are stored on servers around the world (called miners/nodes in Bitcoin). In some ways, it's almost like an intersection with a four-way stop sign - all of the participants have to work together and trust each other in order for it to work. Every blockchain relies on some sort of elaborate system to incentivize participants to collaborate. With Bitcoin, and other proof-of-work blockchains, computers around the world work 24/7 to solve puzzles to maintain the distributed ledger. It might sound silly, but the process of solving puzzles accomplishes several things: - Miners are incentivized for solving the puzzle- they win Bitcoin.
- In order to solve the puzzles, you need a copy of the latest distributed ledger - you can think of this like a critical clue to the puzzle. Without the latest distributed ledger, you won't be able to solve the puzzle.
- Solving the puzzle takes energy. If you try to solve the puzzle without the latest version of the distributed ledger, you're wasting your time and energy. The only way to win the prize (called a mining reward) is to use a valid copy of the distributed ledger.
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