Trust Is completely different From verification – Cryptocurrency cannot function without trust in human InstitutionsMarch 29, 2019
Money is particularly confusing, regardless of the mathematics of individual finance. It is not surprising to see that many people are confused about cryptocurrencies.
Some people find it hard to wrap their head around any cryptocurrency whether Litecoin, Dodge Coin, TCAT tokens, Bitcoin, Ethereum or any token in the cryptocurrency space.
Astonishing price drops did not only shock the speculative investors, but it confused the average Joe as well. Ever since the introduction of the Bitcoin, there have been several variants of the cryptocurrency.
When the traditional financial institutions like JP Morgan Chase came up with their cryptocurrency, there has been a lot of media attention to it.
On in-depth analysis, it can be seen that there is a lot of hype than value. It all started when Satoshi Nakamoto stated, “We have proposed a system for electronic transactions without relying on trust.”
While there is already a lot of information doing the rounds about how blockchains eliminate trust, displace, and reshape value, blockchains in reality have not reached a stage where they are not yet as valuable as the task that they are now replacing for. In some cases, they are often very worse.
The society cannot function without trust. Trust is very important in any transaction. Blockchain should be able to enable a similar trust. While several investors might not know the Bitcoin miners, they continue to trust that fact that the miners will work by the protocol. For, the protocol is that which makes the entire system work.
Verification is not in reality trust. Trust is completely different from verification. The coming of cryptocurrencies and the blockchain technology does not, in reality, eliminate the need to place trust on the human institutions. In many cases, there are likely gaps that cannot be addressed by technology; the demand for people to be in place continues to be there. Nothing works without governance outside the system.
The ability to make permanent changes in the rules is important because, at one point in time or other, there will be a need to make lasting changes in regulations. For as long as hard forks are a possibility, there need to be people who have control over the blockchain, thus able to step out of the system to change the system for good. People are supposed to be in charge.
While modern banking methods are reversible in the way they operate, the Bitcoin is not reversible. The difficulty in making both of these incompatible is due to the insecurity.