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MIT Comes Up with Three Ways That Could Replace Bitcoin


Posted: 24th May 2018 12:20

The year 2009 was a just another pleasant year until the roar of Bitcoins which caused ripples in various sectors, especially in finance and technology. It proposed a system which allowed people to transfer with never-seen-before security standards and most importantly anonymously. It proved itself to be a disruptive technology that can change the way people send and receive payments. Now, after nine years, the value of Bitcoin is still being debated. MIT Technology Review, recently, has brought up some ideas which can bring down Bitcoin.
 
First method
 
Even the drastic improvement of the laws and technology aren’t effective to aid in timely and exact tax payment. An interesting method was proposed by David Andolfatto which could deduct the required tax charges from everyone’s account. He was a researcher at Federal Reserve Bank of St. Louis and put forward a system where algorithms will be deducting the charges from the electronic wallet in the form of Fedcoin.
 
Fedcoin that has code which is derived by tweaking Bitcoin will be a digital currency backed by the central bank. This idea was later improved by Sahil Gupta, an undergraduate at Yale. A simulation was made on this and the result indicated that by implementing this method will increase the security and decrease the cost of maintenance and operation. 
 
Second Method
 
Leveraging the popularity and connectivity to formulate a new currency that can be used by all its users. This would only serve inside the network but will hold value outside just like bitcoins. Telegram did a similar thing, during the first month of this year, it said that it will be creating its own app-specific cryptocurrency. During February, it raised $850 million through ICO to its investors. The second round happened in March and this company which has 200 million users raised another $850 million.
 
So, if the same is done by Facebook, the results will be more effective. There are a lot of advantages for using the app-specific currency. Also, Facebook can deploy another strategy, it could use Bitcoin itself. Currently, the rules of Bitcoin are governed by the miners and validators. If Facebook starts to mine and validate Bitcoins, then it can amend the code based on its specifications and goals.
 
Third Method
 
This is triggered by cryptocurrencies themselves, if the future is going to be based on whom cryptocurrencies aim, then most of the trade will be based on tokens. There is no certainty that it will be based on an open source project. In fact, it is not happening in the future but now. Sometime back, Kodak announced coins that will serve as a licence to the photographs.
 
A certain level of uncertainty will prevail whether Bitcoin can stand in the future or not, but it was the first system to demonstrate that a cryptocurrency based on blockchain – adds UK online casino which is equipped with latest security technologies and offers a realistic casino experience. Cryptocurrencies are just one of the applications of blockchain and still, there are millions of it.


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