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Sunday 22 October 2017
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The Misconception of Bitcoin

When we talk about Bitcoin to those who are non-converts, there is often a glazed look or sneer that follows a comment suggesting that Bitcoin is a scam or my favorite, “Didn’t that guy go to jail?”

We can thank mainstream news and media for this misconception of what is at its core—a checks and balance payment system. This article will explain the basic fundamentals of Bitcoin, explore some of the prevailing views, and suggest a new approach for communicating what Bitcoin is really about.

In following Jeff Garzik, Bitcoin core-developer who said this in Amsterdam during Bitcoin 2014, there are three fundamental aspects to Bitcoin:

1. Distributed
2. Consensus
3. Networks

It’s interesting that you won’t find this detail in the evening news or morning newspaper. Those that do seek knowledge from its source will learn soon enough that the information and message of Bitcoin is skewed in a certain direction. This is understandably the premise of mainstream sensationalist media.

With that in mind—the societal understanding of Bitcoin is in its infancy. There is enormous potential to help shape this dynamic in what we do and how we act. By taking the approach to understand the current prevailing views of Bitcoin and explaining that the system is subject to the same weaknesses of the current Banking system, we can help form a new perspective.

Bitcoin, Banking, and the systems we help create are reflections of our own human behaviours – inclusive of all the emotions of greed, jealousy, fear, and envy. Businesses like Mt.Gox and Silk Road are little different from the Wall St. banks and illegal marketplaces that run the world today. The only differences include the type of money they use, who’s in charge, and who benefits.

The people in charge of Mt.Gox and Silk Road are human and capable of making illegal decisions. Technology and Bitcoin alone is not capable of this.

So when I hear that people think Bitcoin is a scam, I try to draw a comparison and explain that the statement is the equivalent of saying the Internet is a scam. Or that Email is a scam, sounds crazy right? You might be surprised with how very little people are interested in following up their misplaced Bitcoin comment with time in understanding what is really going on.

The most popular misplaced comments about Bitcoin include:

1. Bitcoin is a scam
2. Bitcoin is shutdown
3. The CEO went to jail
4. Bitcoin is in decline

My goal when I hear misconceptions, is to listen. Try it next time you hear a misplaced comment about Bitcoin, and take the time to understand where it came from and who said it. This is often enough evidence of the mainstream understanding and where the greater opportunity is behind it. And if you are interested in the seeing the Bitcoin price rise, it would be to your benefit to pay attention to what the average person thinks.

Stemming from this discussion, I’m often asked how can someone make money in Bitcoin – my answer typically replies with, what is your pain with the current financial system? Because the principles and promise of Bitcoin can solve most of those issues, if that message is communicated well enough and correctly.

Let’s take the approach of Jason King, the founder of Sean’s Outpost who during the Bitcoin Expo in Toronto said it best, “the message should say Bitcoin fed 800 people and gave out 1000 blankets to the homeless.” Rather than Bitcoin is ‘crashing’ – Bitcoin is a force for good. Can you think of how the message of Bitcoin can be shaped differently? I would be interested in hearing your ideas and helping them become a reality.

The lesson here is – a car is only as good as its driver, and the same principle applies to value in all its various forms. The correct approach is that we all have to be better drivers in Bitcoin.

Lisa Cheng

Lisa Cheng is the co-founder of Distributed.buzz and the CEO of the Vanbex Group. She is the force behind the popular news aggregation site BitcoinRegime.com and a behind the scenes advocate of Bitcoin 2.0 and blockchain technology. She comes from an accomplished background after having worked at Fortune 500 companies and technology startups involved with Big Data, algorithmic trading, and enterprise systems. More recently Lisa’s time is focused on consulting and planning for new cryptocurrency projects after having worked for the Mastercoin Foundation in leading the Business Development effort. She is located in Vancouver BC and you can reach her via Twitter @lisacheng. Lisa also accepts Bitcoin tips: 17pAnaBowKr92YcBebi6RrTJf3gogM4Fp8