Cryptoassets by Chris Burniske and Jack Tatar
Chris Burniske’s Perspective
Chris Burniske joined ARK as a Next Generation Internet analyst in August 2014, covering big data, cloud computing, cybersecurity, and cryptocurrency. After ARK became the first public fund manager to invest in bitcoin, Chris transitioned to the role of Blockchain Products Lead. He now collaborates with the ARK business development team and performs deep-dive research on the cryptocurrency and blockchain space. Chris regularly speaks at conferences and has contributed to CNBC, Bloomberg, WSJ, USA Today, the Guardian, and other media outlets on topics relating to Bitcoin, Ethereum, and more.
About Jack Tatar
Jack Tatar is a former writer for The Balance who covered investing and bitcoin. Tatar is currently Managing Partner with Doyle Capital Management, which invests in early-stage cryptoasset companies. He is also a contributor to Forbes. Specifically, editing the newsletter “Forbes CryptoAsset & Blockchain Advisor.” Finally, he is the Chair of the Cryptoasset Working Group for the Wall Street Blockchain Alliance. Tatar was a licensed financial advisor for many years with a large wealth management firm.
“Since then, people have downloaded the open-source software that is Bitcoin, studied its blockchain, and released different blockchains that go far beyond Bitcoin. Blockchain technology can now be thought of as a general purpose technology, on par with that of the steam engine, electricity, and machine learning.” – Chris Burniske
Chapter 1: What Is Bitcoin?
“Blockchain technology came from Bitcoin. In other words, Bitcoin is the mother of blockchain technology. Bitcoin, with a capital B, is a platform that carries upon it programmable money, known as bitcoin with a lowercase b. The technological foundation to this platform is a distributed and digital ledger referred to as a blockchain. In January 2009, when Bitcoin was first released, it embodied the first working implementation of a blockchain the world had seen.”
– CHRIS BURNISKE
Bitcoin is a digital currency created in January 2009. Following the housing market crash, Bitcoin developed from ideas set out in a white paper by the mysterious and pseudo-anonymous Satoshi Nakamoto. The identity of the person or persons who created the technology is still a mystery.
Bitcoin offers the promise of lower transaction fees than traditional online payment mechanisms and is operated by a decentralized authority. Unlike government-issued currencies, there are no physical Bitcoins. Instead, people just have balances kept on a public ledger that everyone has transparent access to. That, along with all Bitcoin transactions, is verified by a massive amount of computing power.
Bitcoins are not issued or backed by any banks or governments, nor are individual Bitcoins valuable as a commodity. Despite it not being legal tender, Bitcoin charts high on popularity and the concept has triggered the launch of hundreds of other virtual currencies. These currencies are collectively referred to as alt coins. As Bitcoin is electronic only, it is known as cryptocurrency unpacking. The etymology of the word cryptocurrency is actually quite interesting. The first part of the word, crypto, means hidden or secret. Hence, Bitcoin is hidden or secret money that you can spend.
In practice, however, it’s not quite as secretive as the name implies. Instead, it’s simply a form of electronic currency that you cannot physically hold. Subsequently, the process of spending Bitcoin is not particularly complicated. Balances of Bitcoin tokens are kept using public and private keys, which are long strings of numbers and letters linked through a mathematical encryption algorithm used to create them. The public key, comparable to a bank account number, serves as the address published to the world and to which others may send Bitcoins. The private key, comparable to an ATM pin, is only used to authorize Bitcoin transmissions. Bitcoin keys should not be confused with a Bitcoin wallet, which is a physical or digital device that facilitates Bitcoin trading. Bitcoin wallets allow users to track ownership of coins.
Chapter 2: What Is a Cryptoasset?
“Human ingenuity often surfaces when it’s most needed, and now, a new technology is emerging that returns to the decentralized ethos of the original Internet with the potential to revolutionize our computational and transactional infrastructure: blockchain technology. Every second, millions of packets of information are transacted between humans and machines using the Internet, and blockchain technology is forcing us to rethink the costs, security, and ownership of these transactions.”
– CHRIS BURNISKE
Cryptocurrency vs Fiat Currency
Bitcoin Is Not Physical
“Microsoft provides Blockchain as a Service (BaaS) for developers within its Azure cloud platform.”
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