CRYPTO is DUMB and YOU'RE DUMB for Liking it.
I know its an insane thought im trying to wrap my head around it still. The title of this video is probably offensive and im. Sorry if you felt offended, but oh lets just hear me out a little, maybe stay till the end, see what happens now. I promised a video on how cryptocurrency works and thats probably going to have to be a series. If you want something in depth, heres just a little bit of a breakdown, but first grumpo. What are your credentials? You may wonder: well, im a software engineer. Ive been a software engineer for the better part of a decade in the tech industry. I have friends in the fintech industry that im very close to, and i have friends who actually work in cryptocurrency and a former manager who works for ethereum. I also have a math degree, so i understand the cryptography part, the mathy bits, if you will, i do not personally work in crypto, so you can take some of what i say with a grain of salt, because i am not on the front line, but i Know enough from working in the fraud and cyber security industry again for the better part of a decade to be able to give my take on this new form of currency and all of these new crypto pop ups. Now you may have seen my video you dont know what an ip address is. I was going to go much more in depth on this topic, but to be completely honest, my channel just doesnt have the growth or engagement to justify that kind of work, and i have a day job.
So thats, probably not gon na happen, unless you like subscribe, tell me that you want to and thats not even like a ploy genuinely. This is probably the best that youre gon na get for now. If you do wan na learn more about crypto yeah uh like and subscribe, but also check out my other content, because um spoiler alert im a software engineer, it doesnt mean that i dont have other interests. I might post about an interesting hack one day, and then i might post about, i dont know lets, say a cover of total eclipse of the heart for like 15 seconds the next day you dont know its a weird channel. Welcome, though, im a human being jeez, not a media company. If i do get enough engagement on my channel, though i will go much more in depth and break down every bit that i mention in this particular video if thats something that you guys want to see. But also i want to stay true to myself and and do my too so, like yeah anyways lets get into the video. So if you couldnt tell, i have a lot of problems with cryptocurrency, just based on the title and the thumbnail that i definitely havent made. Yet but you will have clicked on and like any crypto person im, not a crypto person, but you know, like anybody discussing cryptocurrency a big buzzword is black chain and i too am going to start.
My video with blockchain blockchain is a concept where you have essentially blocks of things and they build upon other blocks of things theres, something called a merkle tree which is used to verify this, these chains of blocks of things and its a compression ish algorithm of sorts. I dont want to get too deep into it, but i can, if you want me to comment down below if thats, something that you would be interested in and this concept first came around with our mothership of crypto bitcoin, now theres a lot of lore around bitcoin, A lot of mystery and that adds to some fun marketing stuff, so im going to skip over that to not dazzle you with that. Instead, im going to tell you that blockchain is a concept and there are variations of it that are in place today that count as blockchain but do very different things. It has different applications. It has been applied to the healthcare industry. It is not just about crypto and the blockchain can be implemented in various different ways so to simplify. This were only going to be limiting our scope to bitcoin and ethereum, which, in my personal and professional opinion, are the only legitimate forms of cryptocurrency anyways and wait until the end ill. Tell you why i promise now talking about implementations of blockchain is extremely important, because that has a lot to do with how cryptocurrency is mined now lets go back to bitcoin the original okay.
Now bitcoin was created to be a completely distributed currency that was untraceable now lets remember these two elements: okay, completely distributed and untraceable. By completely distributed, i mean that the purpose of bitcoin and the way in which blockchain was used for a bitcoin is such that every ledger of every transaction would be hosted on every bitcoin owners machine. So everybody who had bitcoin also had every historical record of every transaction, even if it wasnt made by them now. Obviously this doesnt scale, consumer electronics hardware, has not arisen to the point of being able to support bitcoin for everybody and bitcoins rise in popularity was actually outpacing consumer electronics. The important thing about having a fully distributed system is, if everybody has every ledger of every transaction that has ever been made with this currency, then you cant just come in here with a fake ledger and say hey. I have all the bitcoin because look at all these transactions, because theres a voting process and anybody with a false ledger will be voted out in the block chain and there can also be branches as well. But this branching thing has only come up recently and its come up recently because, like i said before, that doesnt scale well get into that. But in the early days the voting had to be unanimous, more or less for a transaction to go through. So everybody had every purchase record of everybody who used this currency and that is extremely secure having it distributed like that is extremely secure, but now, when it doesnt scale, youre going to need to make it semi distributed.
So what that means? Is you introduce this concept of miners, and miners are machines that can be owned by a company owned by a person that mine bitcoin and in order to mine bitcoin its described as solving puzzles, which sounds honestly, it sounds kind of dumb really what they do. Is they compete with each other to add to the blockchain, so theyll get batches of transactions and try to validate them, and that is what bitcoin miners do today. A drawback of this is its extremely inefficient when it comes to energy, its bad for the environment. Some companies have started to pop up that are energy companies, whose actual purpose is to mine, bitcoin or or other crypto. So thats fun were going from. You know early days, hey this cryptocurrency that only a few people have and is completely distributed to, like. Oh companies are now controlling what ends up in the final block chain companies and wealthy individuals now theres, something called a 51 attack which is essentially, if you have a couple billion dollars, which many people in the world do you can fake ledgers and make it look Like you own all these transactions and essentially rob something like bitcoin or ethereum. Actually, a few years back, ethereum was robbed in such a way, but with the rise and height of cryptocurrency comes the rise in shady companies who want to mine it to profit and with the lack of legislation when it comes to this kind of currency comes a Lot of shady stuff, so i mentioned the 51 attack since now.
Weve lost our fully distributed bitcoin, and there was also a recent hack on a particular ethereum wallet. Wallets are used to keep your identity protected. The second thing that was so attractive about cryptocurrency keeping your identity safe, so with a wallet it would create and manage different addresses for your currency to be sent to so it couldnt be traced. So for all of your illegal activities, you could keep track of those in your wallet, whichever wallet software you used with the centralization of crypto, though, because its not scalable and by centralization, so something thats completely decentralized, would be something that is completely distributed so initially bitcoin At the start of it was completely decentralized. There was no central management machine that kept track of things. It was all in the hands of the consumer. It was more like a democracy lets say like a completely democratic system where there was voting in place and everybody had a copy of the ledgers, but now its been decentralized theres. Also, all of this wallet software – you dont, know where it comes from and with government pushes to track this money. The anonymity is being revoked on pretty much all of these cryptocurrencies. So what made crypto attractive in the beginning is completely gone. Its semi centralized now because only the people who can afford to keep miners running um, which takes a lot of computational power. It takes a lot of energy, its bad for the environment, but like its not like anybody cares about that and it is traceable now, even if you think its not so, everything that was attractive about cryptocurrency to begin with is gone and its probably not coming back.
Actually, it might so. This has been decades worth of research in the making to get it to this point, and it is at a sub optimal point. It will probably take one to four decades to get it to a place where it is actually viable as a currency. So what is up with all of these new cryptocurrencies popping up? We got tick coin, we got coin, we got ass coin, we got grandmas fart coin, i dont know dude every kind of coin imaginable its closely related with pump and dump scams. Lets take a guess as to why well like i mentioned decades worth of research on bitcoin and ethereum, and nobody knows what goes on behind the scenes in these new cryptocurrencies. So ethereum and bitcoin can be distinguished not only by the number of people who buy in and how much they buy into it, but also the underlying algorithms and computer science principles that theyre built upon these new cryptos that are popping up. What are they built upon? Have they published any papers, i mean really. Are they built on the backbone of bitcoin? Is there a blockchain paper that they have done something new to completely decentralize and keep your transactions private? Because no, you know what they say. They say its going to the moon and you should invest in my mind that reduces it to some trendy stock to invest in where the company does nothing. Literally literally. Nothing, because are the people who invest in these cryptocurrencies going to spend them on something no theyre likely not going to theyre likely going to instead just put their money in because they want it to grow because they see a trend but youre investing without having done Any research and um youre investing in likely nothing.
What is the technology behind this? I dont know why dont you freaking tell me i would invest if i knew, but i doubt theres much behind it because, like i said decades worth of research, some of its published a lot of it is proprietary. So, if youre going to invest in cryptocurrency, invest in the older ones, invest in the vetted ones like bitcoin and ethereum, but should you actually invest in those im a little im, a little torn on saying whether or not you should? To be honest, i do think its possible that consumer electronics will catch up to the point where its viable as a currency, but i think thatll take a really long time and i think theres a huge bubble right now. Thats, probably gon na burst. Once people stop seeing returns and realize that uh federal governments are tracking their transactions, its not untraceable anymore dont be stupid. So, honestly, if i were to give any investment advice, im, not a finance person, so like dont, listen to me, but for me personally, i would wait until the bubble bursts by then, because i can see it becoming viable long term in the next 10 to 40 Years, if you dont want to wait that long, though, maybe invest in the stock market, invest in companies that are doing real things to make money and not in something that has a cool sounding name: cryptocurrency: oh yeah, math, the cryptography. Oh, my gosh sherlock holmes dont its dumb.
If you want me to get into more of the details on that then like and subscribe, and i mean comment and tell me that you want me to but also check out my other content because uh its iffy, i make content based on my mood. What i engineer all day, im multifaceted, i have other interests, come on its not just one thing, and i encourage you to branch out as well.