First and foremost
The economy is backed by money from the government. This can be the dollar, euro, pound, japanese yen etc. yet there is a whole new currency in the spotlight now that might kick all these currencies of their thrones. Now don't get me wrong because the currencies we use now, wont vanish that easily, however having Bitcoin in our midst with the underlaying satoshi value, might be very interesting!
Dollars
Dollars or paper money has arisen because it simply was not convenient to pay with gold bars. For that reason they have developed paper money so making trades would become alot easier. This is also called fiat money.
The whole economy runs on credit and paper money that can be adjusted to keep the economy stable to prevent inflation and deflation. That means, however, that there must be an entity responsible for printing that money. which in America is the Federal reserve. In the past, banks have shown that they can not deal with that responsibility very well and have led to many sovereign debt. And so far we haven't really been able to choose an alternative because banks have been around for quite some time making all the decisions for us.
So paper money backed by 1 entity is as of today since decades back still the only way to determine the value of something.
Satoshis
Now Bitcoin is a little different, because Bitcoin allows us to live on top of a whole new economy that hasn't been possible for decades because of the banks! As some of you may know there are 21 million Bitcoins in circulation of which every Bitcoin can be divided into 100,000 pieces, so that no one falls short. It wouldn't be very logic to only have 21million Bitcoins with 7b people on earth don't you think?
21.000.000x100.000=2.100.000.000.000 bitcoin pieces.
Now let me give you a few examples of satoshis compared to dollars.
Coffey: $2,50 - Ƀ0.000344
Bread: $1,50 - Ƀ0.000206
Car: $1.000 - Ƀ0.137411
Laptop: $450 - Ƀ0.061826
You can see that you are paying in decimals because your paying with a part of an entire Bitcoin. For me i really don't care if i pay with a round number or a decimal, but for some people it seems to be a pain in the ass.
The alternative economy
So with Bitcoin in this world, altcoins can now rely on the satoshi value rather than the dollar value. All coins such as Ethereum, Neo, Monero, Dash, Stratis, Lisk and the list goes on are all backed by the satoshi value. And the more Bitcoin increases in value the more altcoins will increase in value too! For decades we have been relying on the banks and now for the first time we can get that power back.
And not to forget. With all these cryptycurrencies having their own purposes it can really grow out to one big economy of different coins with different use-cases. I believe that decentralized exchanges for that reason can grow really big. Looking alot at Neon exchange and Waves exchange! Maybe you should consider doing som due dilligence on decentralized exchanges ;)!
Thankyou for reading and i hope this article was helpful!
best regards,
Sem
