What problem did Bitcoin solve for electronic currency (Bitcoin improvement)

What problem did Bitcoin solve for electronic currency? What exactly is Bitcoin? In 2008, Satoshi, a digital cryptocurrency, was created by Satoshi Nakamoto. Although there were some controversial voices at the time, it eventually gained attention and acceptance from the majority of people.

Based on the development direction of blockchain technology, Satoshi has established a protocol called Ethereum based on the DAG file system. This system aims to eliminate the need for a centralized network by storing DAG files on a single server. This solution enables trustless data transfers.

Although the benefits of using blockchain technology are transparency, verifiability, and anonymity, its security is still questionable in the current situation. Due to the issues of insufficient security, privacy, and tamper-resistance with DAG data, a new distributed ledger is needed to record the activity status of each node. However, for those who want to transact with their own identity, these features make their payment method extremely convenient and fast.

However, now, as time goes on, more and more individuals are turning to the use of smart contracts to manage their accounts. For example, when you deposit money into a bank account (when you want to withdraw funds from your phone), people are no longer willing to keep their private keys or other information.

To prevent the possibility of user theft, money laundering, and untraceability, Bitcoin also offers faster confirmation speeds.

According to The New York Times, Roger Ver, the chief scientist of Bitcoin Core, said, “We believe that Bitcoin, as a network independent of the Bitcoin community, has great potential.” Bitcoin’s competitive advantage against Tether was initially focused on solving cash flow problems to some extent. But recent situations have also changed a lot. First of all, without the support of Bitcoin supporters, they may lose their value. Also, they will continue to leverage the technical capabilities of Bitcoin. Secondly, cryptocurrencies with a fixed supply like XRP are usually not directly used for trading purposes. Isn’t Bitcoin a stablecoin? As mentioned earlier: it is not suitable as a general accounting unit or official currency that anyone can use. Instead, Bitcoin provides functionality that allows people to easily buy Bitcoin and other cryptocurrencies. Bitcoin doesn’t even need to issue fiat currency; it just replaces the dollars with it. This means that users can mine more tokens outside of Bitcoin. Bitcoin can also promote increased financial inclusivity; specifically, it allows many non-governmental organizations to establish a global economic system so that they can create more public goods and services without relying on third-party institutions.

Bitcoin Improvement

Editor’s note: This article is from Cointelegraph China (ID: CointelegraphChina) and is authorized to be reproduced by Daily Planet.

Improvements to Bitcoin are happening, and its network has evolved from a network operated by a small group of people to a more decentralized system to promote scalability. This all started with the bull market in 2017. At that time, the price of Bitcoin rose nearly 50% in the past 24 hours, reaching a historical high. However, since then, the “BTC/USD” trading pair has been in a loss for several weeks in a row. Recently, there has been an “abnormally high premium” on the exchange, while trading volume has not significantly decreased. This is due to the “BTC price drop” causing the market to be over-leveraged. Despite this, the volatility of “BTC/USD” is still lower than the historical high of about $65,000 set in December of last year. With prices continuously lower and transaction fees increasing, this trend is starting to weaken. Compared with the previous bear market, the current price trend seems to be healthier. According to CoinMetrics data, the price of BTC has fallen to around $43,000 since January of this year.

One major problem in the Bitcoin network is that in early July 2018, a person named Whitfield Diffie (also known as William Phillips) told Cointelegraph, “When you consider the current state of the market, we may see further significant declines in the price, or bigger problems – Will Bitcoin replace fiat currencies?”

If you want to answer this question, it is, “Do you think the cryptocurrency industry needs a few more years to establish itself? If you want to know the answer… of course not! I can say for sure that we are in that stage.” But some members of the Bitcoin community also agree with this view. “What we must recognize is that it will become a new store of value rather than a substitute,” they added. Bitcoin is a highly secure, easy-to-use, and non-portable asset that is still under the supervision and review of strict regulatory agencies. However, the Bitcoin blockchain itself does not fully comply with all regulations, making it difficult to modify or change. Instead, it is designed to create security features for different purposes.