From the dawn of time, or at least the time in which humans have roamed, currency of all forms have been used. The early homosapiens used animal meat and tools as a means of currency. As technology advanced, humans began to use the paper currency we are familiar with, and as technology further evolved, credit cards were introduced. In a time where our lives are becoming increasingly reliant on the internet, and other forms of digital technology, it is almost assumed that our current form of currency will reflect that, and in recent years, it has through cryptocurrencies.
In a world where the green dollar bill is as recognizable as the back of our hand, the word ‘cryptocurrency’ may seem daunting. However, it is predicted by many that this form of transaction will exponentially gain popularity, and perhaps replace the Washington’s, Jackson’s, and Franklin’s that many currently are familiar with.
This idea of a digitized currency was first conceived in the 90s from a collaborative called the Cypherpunks in the 90s. The cypherpunks advocated for the privacy of all, and sought to bring this privacy through cryptography, or coding. “We are defending our privacy with cryptography, with anonymous mail forwarding systems, with digital signatures, and with electronic money,” wrote Eric Hughes in ‘A Cypherpunk’s Manifesto’.
This idea of one’s privacy being stripped when one’s purchases are revealed was commonly spoken of by members of this group. Many believed that one should have the choice as to whether their identity was revealed, and saw a future in which people could make a transaction and maintain this anonymity. “Until now, cash has been the primary such system,” said Hughes in the Manifesto. “An anonymous transaction system is not a secret transaction system. An anonymous system empowers individuals to reveal their identity when desired and only when desired; this is the essence of privacy.”
Various members of this movement attempted to create currencies that allowed this idea of anonymous transactions to come to fruition, but all had flaws that prevented them from gaining traction. That is until Bitcoin was created. Bitcoin is the first decentralized cryptocurrency. It was created in 2009 by a person under the alias Satoshi Nakamoto. It appeals to the cypherpunks desire for anonymous transactions, and also to the public, as it eliminates “the middleman”, or banks, which regulate people’s finances and charges fees and taxes to do so.
This lack of fees is extremely attractive to those who make international transactions. When sending a form traditional currency, the bank or company that delivers this transaction takes a small cut. When using Bitcoin, there is no fee, and the bitcoin goes directly into one’s wallet, which is also digitized, and protected.
Transactions are recorded in the ledger, or the blockchain, using cryptography, leaving all coins accounted for, although the people making said transaction remain anonymous. In the documentary Banking on Bitcoin, Michael Casey, a columnist for the Wall Street Journal, said that Bitcoin, and similar technologies rids of “the inefficiencies, and ultimately the potential for corruption and risk that come with centralizing information…”Currencies using similar have since emerged, including Litecoin, Ripple, and Ethereum.
These currencies have grown increasingly popular in recent years, and many who invested in them have been able to greatly profit, so long as they invest in the right coin at the right time.
Sophomore Jesse West is just one who decided to invest in these currencies. “My dad was the one that got me into it. I had been hearing a lot about bitcoin but I was too scared to invest. I didn’t really know where to get it or if it was a good decision or not,” said West. West’s father give Jesse a small amount of bitcoin to start off, “and that’s when I really got into it,” he said. Soon after, he began turning a profit, fulfilling his goal upon entering the cryptocurrency world: to make money.
This desire for some extra money soon evolved into a hobby for West, who said the process is a “thrill”.
Bitcoin is currently experiencing a decrease in value, however that figure is expected to change. Because of this shrinking value, many have lost great deals of money, causing an uproar. Junior Chris Grimes is just one who lost money through his investments in Litecoin and Ripple, two other popular cryptocurrencies. He lost his initial 300 dollar investment, “but not for long hopefully,” Grimes added.
West switches his coins around various cryptocurrencies, depending on the coins profitability at the time. “Bitcoin has been fluctuating a lot lately… that’s why you try to diversify your portfolio,” said West. “You don’t put it all in bitcoin, you get some other altcoins and you spread out the risks. That’s why when Bitcoin went down I wasn’t hurt that much because I was in a lot of different types of coins.”
This decline can be attributed to South Korea’s ban of Bitcoin, and other digital currencies. There are many negative connotations surrounding cryptocurrency because of the way it has been used. Because of the anonymity of this coin, people are able to use it on the DarkWeb and purchase various illegal items, like drugs and guns.
“When I first heard about bitcoin it was human trafficking that was paid by bitcoin. That doesn’t really turn me away from it because you have to know what website you are using and if they are credible. You have to be cautious because it is something that is used on the dark web, but real US money is also used in drug trades and in gun trades, so it’s sort of the same deal. You just have to be mindful of what you are using your bitcoin for,” said West.
In addition to being cautious of how you are using the various cryptocurrencies, West said researching the coin’s history is vital in achieving any success through this new technology. “You want to look at the background on a coin before you buy it. If this new coin that this article is saying is going to be really good, you want to look up how long this coin has been around, the depth chart, how many people have been buying it, and are people actually engaging in this or is it just going to die out,” he said.
Grimes offers similar advice, saying, “ I would encourage others to invest as long as they are willing to put in the time to research crypto before they invest.”