Video Explains Bitcoin and How it Can Change the World
Animated short shows how crypto-currencies can shake up the structure of society
An informative animated video short breaks down the Bitcoin system and explores how crypto currencies can change the way we do business, and even restructure society. In the Bitcoin video, created by designers and entrepreneurs as part of a nonprofit initiative, the relatively new Internet currency system is broken down into simple terms, with easy to understand diagrams and animation.
Bitcoin is a virtual currency that was created in 2009 by an unknown person using the alias Satoshi Nakamoto. The Bitcoin system is not controlled by anyone and operates through a computer network system. Bitcoin cuts out the middleman required in traditional financial transactions, eliminating the need for banks, paper money, accountants or fees. The free system is used for everything from person to person transactions through mobile devices to paying for goods or services and sending international transactions with no fees.
According to the video, people only think of Bitcoin as virtual money or a transaction system, but the ground-breaking Internet technology can be used for a lot more than money. Bitcoin is not owned by anyone, and allows a network of computers to maintain a public ledger via the Internet – called the blockchain. In the blockchain, all transactions are logged. Each node – or Bitcoin participant – in the network owns a full copy of the blockchain, so everyone is equally informed. The transactions are verified by the Bitcoin “miners,” who maintain the ledger. If an attempt to corrupt a transaction is made, the nodes will not agree and will refuse to incorporate the transaction into the blockchain. This thwarts fraudulent transactions from going through the Bitcoin system.
Bitcoin is a flexible crypto-currency system that can be applied to many areas of society, according to the video. Users can decide for themselves what a unit of Bitcoin is worth, assigning properties to each unit, from a Euro cent to a kilowatt hour to a certificate of ownership. A Bitcoin could even represent a vote in an election.
Bitcoin streamlines systems by cutting out the middlemen and bureaucracy. Companies can automate cash and money flows, setting a budget through Bitcoin so a certain amount is approved for specific expenditures, such as employee salaries, material costs and maintenance. This automates budgets and prevents misuse of funds and overspending. The crypto-currency system can also be used for areas like health care, where a health care allowance can be preset so it only works with certified parties. Unlike traditional administrative systems that require human oversight, rules can be programmed into the crypto-currency system. Bitcoin units can even be returned to the provider if they’re not used.
The programmable, open character of Bitcoin allows society to rebuild administrative and financial processes, according to the video. The technology behind crypto-currencies such as Bitcoin makes our financial processes more transparent.