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The history of digital money

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(Image credit: Shutterstock / Wit Olszewksi)

A pivotal moment took place in the crypto industry four years ago, on August 1st, 2017, when the Bitcoin (BTC) network split into two and each holder of BTC received an equal amount in a new cryptocurrency – Bitcoin Cash (BCH). The new cryptocurrency had real value, costing as much as $400 per coin. The opportunity of getting some free cash in such a manner would herald the launch of a slew of forks. But avarice and the lust for profiteering have no place in this Bitcoin spinoff.

The pains of aging

Anything that can go wrong, will go wrong.

Murphy’s LawThe fact is that Bitcoin was becoming popular as its value grew and the number of users increased along with the volume of transactions they made. Confirmation times and transaction costs also increased, eventually impeding the development of the world’s first digital currency. No one would be willing to buy a cup of coffee using Bitcoin if they had to pay a commission double the cup’s price. In addition, the merchants were not prepared to wait for days for transaction confirmation. All these issues called into question the use of Bitcoin as a means of payment.

Bitcoin ended up implementing a technology called SegWit in an attempt to reduce transaction fees. In one sense, it has succeeded. Fees are slightly cheaper than they would otherwise be without SegWit. However, adoption of SegWit has continued for years. Even with perfect adoption, bitcoin fees remain too high for normal cash transactions.

“Today BCH is closer to the Bitcoin that Satoshi Nakamoto created, than the coin we call BTC today.”

Amaury Sechet, BCH Developer & CreatorIn fact, there were two solutions and both were implemented, leading to the fork. The problems related to commissions and transaction confirmation times were solved, without the complication of SegWit, by increasing external storage space. Such a solution was overall more natural and consistent with the real Bitcoin.

Four years ago, the crypto community got another new Bitcoin and the new Bitcoin Cash, which was similar to the original Bitcoin by Satoshi. The goals that had triggered the dispute and resulted in the fork were not achieved, because neither BTC nor BCH became a means of payment like fiat currency, although BTC was formally recognized by El Salvador as on par with the US dollar.

Amaury Sechet, the founder of the eCash project and a benevolent dictator (as he calls himself), was at the heart of the events that took place four years ago. Today, eCash represents the continuation of Bitcoin’s development, combining the best aspects of BTC, BCH and BCHA. I like to entertain a degree of hope that Sechet will be able to attain the goals those projects had set for themselves.

The solutions of the dictators

Satoshi Nakamoto has never been a democrat. That is how he managed to create Bitcoin. Then Satoshi left and Bitcoin started stomping on the spot.

Amaury Sechet, BCH Developer & CreatorThe history of the development of Bitcoin and the formation of this cryptocurrency as the first digital form of cash does not end with the events that had taken place four years ago, as described above. We can say that development has never really stopped and sometimes tough and unpopular decisions have been required, and have had to be made by only one person.

Satoshi Nakamoto faced such problems in the past, and Amaury Sechet faces the same problems today. At first glance, making decisions single-handedly in a decentralized project may seem like a dubious idea, but that actually helps achieve traction.

Amaury Sechet, the founder of the eCash project and a benevolent dictator (as he calls himself), was at the heart of the events that took place four years ago. Today, eCash represents the continuation of Bitcoin’s development, combining the best aspects of BTC, BCH and BCHA. I like to entertain a degree of hope that Sechet will be able to attain the goals those projects had set for themselves.

The future of digital cash

Digital cash will become the currency of the future, just as fiat is the currency of today. It will become an integral instrument of the economy. It is also likely that the migration to digital currency will not just involve the digitization of cash, but will continue on to attain such levels of progress that would be comparable with the transition from horsepower to the internal combustion engine.

I like to believe that such digital cash will be reliable, protected from inflation and convenient in everyday use, and it should also be built on the basis of a near-perfect and scalable technology that can go global.

With digital cash as its surfboard, the future would become unstoppable, even if central banks are capable of impeding their spread until the development and launch of state digital currencies. Only time will tell which digital form of cash will become dominant – alternative coins, BTC, or an iteration of some state-issued “digital yuan”.

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