Cryptocurrencies – Bitcoin and Altcoin

The global financial crisis that erupted in 2008 caused many changes in the world financial system, while the stock exchanges collapsed, credit rating agencies lost their reputation, financial institutions and companies came to the brink of bankruptcy and the big banks sank. However, above all, people's view of the financial sector has changed and their confidence in the banks has been seriously damaged. Bitcoin, which emerged after the collapse of financial markets, was presented as an alternative model to the failure of the financial system and strong reserve currencies (dollar and euro).

Cryptocurrencies – Bitcoin and Altcoin

After the global crisis broke out, the crypto currency Bitcoin first appeared in the article "Bitcoin: A Peer-to-Peer Electronic Cash System" written by Sathoshi Nakamoto. After the global crisis, when people lost their trust in the world of finance, they needed an alternative means of exchange.

It is possible to define Bitcoin as an electronic payment system based on the proof of encryption and where the two sides are directly connected. It tries to give a new understanding of how to solve the problem of trust through technology after the global crisis. One of the most important features of crypto coins is; instead of trusting the authorities with power to print money, it directs the trust to the mathematical rules and computer algorithms.

Bitcoin is a limited, non-centrally controlled currency unlike the paper money we use today. So it is possible to evaluate it as digital gold & silver.

Bitcoin is a program written with Blockchain technology. Bitcoin works as a means to control money just as Windows allows you to control the computer. In other words, Bitcoin is a computer program that performs a serious function and makes it much better than its competitor; dollar.

When we compare the current money with digital assets: we see that paper money is currency, but there is no payment network; Paypal, Visa, Master and Access systems are payment networks but not currencies. Thus, Bitcoin is considered a type of money because Bitcoin and other Altcoins are currencies and their payment network system is Blockchain.

Bitcoin is the largest currency in the cryptocurrency market and its abbreviation is BTC. The smallest unit of Bitcoin is defined as "satoshi" and 100 million satoshi is calculated as 1 BTC (1 sathoshi = 0.00000001 Bitcoin).

An easy-to-use Bitcoin can be bought and sold and transferred quickly. Cryptography principles are used to control the creation and modification of Bitcoin, with an advanced technology called Blockchain. When compared to the standard nominal currencies such as the dollar or euro, the most important feature of Bitcoin is that it is controlled by a software algorithm, not by a person, group, company, central authority or government. Bitcoin, which is the most powerful in crypto coins, is limited to 21 million. By the year 2140, the maximum amount of circulating bitcoins will reach 21 million, provided the system operates correctly.

When we look at the price chart from the year 2008 when Bitcoin emerged, the market value was 0.07 dollars in 2008-2010, 1 dollar in 2011, 13 dollars in 2012, it continued its outflow with 266 dollars in 2013 and closed 2016 with a value of 960 dollars. Bitcoin, which entered the year 2017 with $960, showed an incredible performance throughout the year and reached the level of 20 thousand dollars. Bitcoin 's appreciation in such a short period of time has been widely acclaimed and it is called as the digital/virtual gold.

The biggest reason for the rise of Bitcoin to $ 20,000 is the sale of the 2018 contracts on the US official commodity and option exchanges (CME-CBOE) and the subsequent decision making in Japan, South Korea and the EU countries. The fact that bitcoin is accepted as a commodity is a revolution, but it should not be overlooked that these exchanges will cause excessive price fluctuations. As a matter of fact, this is the main factor that it decreased from $20,000 in 2018 to $6000 in the last quarter of 2018. However, bitcoin has a different property than petroleum, steel, cotton, etc. commodities. It is the world's new value exchange tool. Looking at this aspect, there will be a trans-commodity acceptance among people and this will cause the price to go beyond the estimates.

The price of Bitcoin is determined by the relationship between supply and demand in the markets. Although it is not connected to any legal currency, there are various platforms (buy-sell online exchanges) in which users can change the Bitcoins in the real market. Bitcoin and altcoin exchanges are different from the stock exchanges used by today's finance sector. Crypto coins that are traded on these exchanges are not connected to any country, they do not have opening-closing hours and they are working 24/7.

7 intermediary cryptocurrency exchanges are located in Turkey and the number is increasing. There are around 1300 similar exchanges around the world, the number of which is also increasing every day.

Today, banks, stock exchanges and public institutions are under perfect protection, but they can be hacked as a result of cyber attacks. stock exchanges are also sometimes exposed to cyber attacks and hacked. Today, we can see that almost all of the exchanges that can be hacked or closed are working on central servers. However, blockchain technology allows decentralized exchanges that run on all computers in the network, you must detect and disable all computers in that network to close or hack such a stock market, which is very, very difficult or even near impossible. Technology is constantly evolving and exchanges are currently using atomic-swaps. This means that after a while users will be trading between different coins from their computers, and thus will not need the stock market. Because the main philosophy of this system is that there are no intermediary means, which is called P2P (Peer-to-peer).

States should have the idea of how to benefit from this system at the highest level instead of closing or prohibiting these systems. Because it is impossible to close any decentralized system. A state that wants to stop Bitcoin has no other choice but to shut down the Internet. In the following years even this will not work as the conventional internet space will swap places with cloud-based internet connections. In other words, Blockchain's encrypted-secret, smart-programmable and decentralized structure will make life easier for people and harder for states that try to ban it.

Banks are closely interested in this technology, and Akbank has pioneered in this regard. Aköde Elektronik Para ve Ödeme Hizmetleri Inc. is authorized by Turkey’s Banking Regulation and Supervision Agency (BDDK) to operate as an electronic money institution and to receive consultancy services from Akbank Inc.

Modern and new generation financing methods such as Crowdfunding and ICC (Initial Coin Offering) will be expanded for promoting digital transformation and financing innovative projects.

The use of Bitcoin is getting widespread more and more in both internet and shopping. Bitcoin ATMs and the number of Bitcoin accepting businesses are increasing day by day. For example, many businesses such as E-Bay, Amazon, Dell, Microsoft, Subway, Tesla and Bloomberg accepted Bitcoin as a means of payment.

References

1- Prof.Dr. Orman Sabri, Modern İktisat Literatüründe Para, Kredi ve Faiz
2- İSEFAM Doç. Dr. Sakarya Üniversitesi, İlahiyat Fakültesi. KRİPTO PARA BİRİMLERİ VE FIKHİ AÇIDAN DEĞERLENDİRİLMESİ
3- Betül Üzer, Sanal Para Birimleri, Türkiye Cumhuriyet Merkez Bankası Ödeme Sistemleri Genel Müdürlüğü Uzmanlık Tezi
4- Şerif DİLEK SETA BLOCKCHAiN TEKNOLOJiSi VE BiTCOiN Şubat 2018
5- Dr. Abdurrahman ÇARKACIOĞLU, Kripto-Para Bitcoin SPK Araştırmas Dairesi Raporu 2016
6- Nakamoto, Satoshi, Bitcoin: Eşten-eşe Elektronik Nakit Ödeme Sistemi, çeviri www.bitcoinhaber.net
7- Ekovizyon Dergisi, www.ekovizyon.com.tr
8- Ergün DİLER Takvim Gazetesi köşe yazısı
9- Erkan Öz 2020 Büyük Kriz Müthiş Fırsat Yeni Ekonomi
10- Erkan Öz Tiwitter Floodları
11- KriptoParalar ve Ekonomik ve Finansal Yıkım - Erkan Öz
12- Microsoft Türkiye Genel Müdür Yardımcısı Cavit Yantaç - Gündem Teknoloji
13- Microsoft Türkiye Genel Müdür Yardımcısı Cavit Yantaç Blockchain – 7 Aralık 2017,Ankara Zirvesi 2017.
Press enter to search
Press enter to search