POG, page-25

@edithzion


Its incredibly early days for bitcoin/blockchain. There are teething issues, mostly around the fact that the owner is 100% responsible for the security of their bitcoin, and there is no insurance.

To slightly over-simplify it, a 'bitcoin' is two very long encrypted numbers. One is public for all to see, the other is private. There is a ledger available for anyone to see with all the public keys and how much bitcoin is stored in each. The private key mathematically proves you are the owner of the public key. if you lose that private key or it gets stolen, the BTC is no longer yours. In the future much more robust and secure systems will be invented for keeping the private keys safe. for now, people need to take that responsibility on for themselves, basically.

To oversimplify it even more, bitcoin is just a system of trust. Just like the USD or AUD is. With a fiat dollar, you are trusting the government that issues it that it will act in good faith to maintain its value for you. With BTC, you are trusting open source software.