SOOOOOO...Can you explain what bitcoin is? And how I might benefit from it as a cam model?
I've been surrounded by neckbeards circle jerking cryptocurrencies for like a decade, and I'm too annoyed with them to actually ask "ok but wtf is it?!"
Sorry, super basic question!
LOL no worries! This is probably the best question to answer, for starters. I think all the misconceptions about cryptocurrency comes from simply not knowing what the hell it is...and whenever you ask someone (r/bitcoin, I'm talking to
you), they're either a total dick (as though you're supposed to just understand this stuff out of thin air) or give you an intentionally confusing explanation to make themselves feel better for being a mama's basement-dweller. I'll try to use an analogy to explain the basic idea of it. Bear with me, I promise this is going somewhere:
***BITCOIN AND CRYPTOCURRENCY EXPLAINED (non-douchebag edition) ***
So, say I have an orange. I give the orange to you. Now, I no longer have the orange; you have the orange. I physically handed it to you and I didn't need an intermediary or third party to help me give you the orange. We didn't need to have a notary sit there and witness this happening to verify that I gave you the orange.
The orange is
yours. I have no control over it anymore - you do.
Now, imagine that orange is a digital orange. What if I made a bunch of copies of the orange on my computer, so when I give it to you, I can also turn around and give it to 1,000 other people? So that's kind of a problem - the orange is a commodity, and I can use it to trade with you or to pay you...but if I can just make a bunch of copies, it's pretty much worthless, right?
This is called the
"double spending problem" and it was a conundrum that prevented the creation of a truly digital form of money for
decades. It was impossible to use a digital asset like you would a physical one (where I can hand you cash and I don't need a third party to help verify or facilitate my doing so) because people could just abuse the system by making copies.
So maybe I need to keep a digital ledger of my digital oranges, like an online notebook where I input the transaction history of the digital orange. But the problem here is that I can add a few digital oranges to my ledger here and there, or lie about my transactions. I'd have to have a third party (like a bank) to serve as a trusted middleman...but the third party might have rules about the transaction: I can only use digital oranges for things the third party
allows me to use them for. Maybe they're super anti-porn and won't let me give you the digital orange in return for one of your videos. That's kinda fucked because, like, it's
mine. On top of that, this third party charges me a large percentage of my digital oranges whenever I want to spend them...and sending them to you can take days, or even weeks.
How do I do digitally what I did physically, back when I could just hand you the orange in person?
Someone said "fuck all that" and gave the ledger to
everyone. Now everybody has a copy of the same digital ledger and they can see every transaction that ever happens. I can't cheat the system because if I secretly add a few digital oranges to my ledger, it won't sync up with everyone else's ledgers. It's impossible for me to cheat this system, especially when the system involves millions of people.
The other thing about this ledger that everyone has is that it's
decentralized - no one person controls it, nobody governs it. All of its rules were defined at the very beginning, and the total number of digital oranges that will ever exist have been defined. All transactions are verified by everyone on this public ledger (the blockchain). One of the incentives here is that by verifying transactions on the ledger (bitcoin mining), people are rewarded with a bunch of digital oranges (bitcoin mining rewards).
This is - in a very, very simplified way - the core of the bitcoin protocol. I know
exactly how many digital oranges exist, I know they are limited (they have scarcity, which is important for any financial asset). I know that when I send you my digital orange, it is
completely yours - it's all logged in this digital ledger that everyone sees. And because it's public, I don't need a third party or intermediary to verify anything. Nobody can tell me what or how to spend my digital oranges.
The blockchain is like a bunch of legos (blocks) put together in a loooong string. Miners contribute their computer's hashing power to update the ledger and verify transactions and are rewarded bitcoin for doing so. There's a finite number of bitcoin that will exist, and the economy of it is regulated by the rewards slowly being doled out over time (the rewards become less and less bitcoin for more and more blocks that are hashed over time - this is part of the scarcity mechanism that regulates the "value" of bitcoin).
People say bitcoin is anonymous, but it's technically pseudonymous. Everyone has a special digital wallet (or many) for their bitcoin that has
two keys (passwords that are long strings of numbers and letters). One of these keys is the public key - this is your wallet's address (and you can generate an infinite number of different addresses - maybe you don't want someone googling your bitcoin address and seeing it pop up somewhere else you might have posted it, so you use a new one): this address shows up on the blockchain ledger whenever someone sends you bitcoin so as to verify the transaction. However, nobody can know who you are or where you are with this public key. All they know is that a transaction happened.
The other key is your private key. This is the "password" you use to send bitcoin. Only
you know this key. You can access your bitcoin wallet anywhere in the world by using this unique key. In many third world countries, people who don't have access to banks are able to use bitcoin with even the old-as-fuck Nokia 3000 (the cheapest, most common phone in the world). Banks charge insane fees for these people to send money home to their families (and the banks can take weeks to send the money), but now these people can send their money in bitcoin, instantly across the world and for a minor fee (usually, bitcoin fees are incentives for miners to process your transaction on the next block as opposed to a block that will be hashed, say, an hour from now). These fees are seldom more than a few cents.
So, we have a peer-to-peer economy now, where everyone has equal power. Anyone can update the blockchain with cool, clever ideas. They can attach things to the ledger, like photos or videos or entire websites. They can build applications on top of the blockchain. Every single individual is essentially a bank. You can even lend money using cryptocurrencies (which, in truth, are a small part of the equation - the cryptocurrency is simply the token used
on the blockchain).
"Smart Contracts" are uniquely defined protocols you can build on the blockchain. Say I want to buy a custom video from you, but I don't want to be ripped off (and you don't want to make the custom video and not be paid). Well, you can use an escrow-type smart contract that says the funds will be released to you at the exact moment the custom video is released to the buyer (all verified by the public ledger). Oh, and you don't owe any middleman a "cut".
These decentralized applications and contracts can be used for anything: right now, there's a global housing market being created wherein people can "tokenize" their real estate. Someone can exchange digital assets via a smart contract in return for the token (or digital deed of ownership of the property) - no expensive lawyer fees, intermediaries, or third parties needed. There's no way to be ripped off or screwed over, and nobody can tell you how, when, where, or to whom you can sell your real estate.
Tokens can be created to support a technology, an idea, a website, even a person - there are now voting platforms wherein you use cryptocurrency to leverage votes. Again, the system is tamper-proof.
Why crypto is actually relevant:
I'll first briefly explain why cryptocurrency is actually going to see widespread adoption and become relevant to more than just libertarians and neckbearded nerds:
Cryptocurrency is still an infant market (hence the volatility), but it is finally being embraced by governments and major banks as of 2017. The NYSE (new york stock exchange) has announced they will be listing index funds of various cryptocurrencies as well as a Bitcoin exchange. Wall Street investors have been accumulating millions in BTC (the ticker symbol for Bitcoin) in anticipation of major adoption and bullish trend markets (prices going up). The SEC (securities exchange commission) has filed regulations and the IRS has a taxation protocol for crypto assets. Major banks and payment processors now use blockchain technology to facilitate instant international transactions (e.g. Ripple's XRapid network). Even Walmart is using blockchain tech for record keeping, inventory, etc.
Hundreds of cryptocurrencies have been created, all serving different purposes: Ripple (XRP) seeks to facilitate instant and inexpensive international money transfers. Ethereum Lend (ETHLEND) is a money lending platform that uses smart contracts to facilitate instant loans and all that goes along with it. TRON (TRX) built their own entire blockchain (TRC10) on which they're constructing an entire new internet. You can use TRX to pay for media, porn (on PornHub at this moment), and now they have acquired the entire BitTorrent network (1M+ daily users) and have tokenized peer-to-peer downloading and file sharing. Ethereum was revolutionary by creating the ERC20 blockchain protocol on which almost all second and third generation cryptocurrencies were built. This is where smart contracts and "dapps" (decentralized applications - anything from a bank to a voting platform to a video game) are built.
PornHub began accepting two cryptocurrencies: TRON (TRX) and Verge (XVG). People can buy porn and literally have complete anonymity - customers like this, but they need crypto to be less confusing. They have an option where models can be paid in XVG. It's instant and requires almost no transaction fees (thus, higher payouts) and will never be subject to discrimination.
Now we get to the truly relevant topic:
How can cryptocurrency help me as a model?
We all know that PayPal hates adult media - the CEO has been outright discriminatory of sex workers. Accounts are frozen, assets seized. Credit Card companies are impossibly painful to deal with - they are the reason places like clips4sale have a LONGASS list of no-no words that often don't make any sense. They charge the merchants (in this case, c4s) exorbitant fees which means our payouts are a lower percentage because we help cover these fees. Banks charge even more fees for direct deposits (and all payment methods take days or weeks to finalize). The ways we can get paid are on tiny little threads, and more of them are breaking every year.
Right this second, crypto is still an intimidating, confusing space. A lot of people don’t understand it and don’t care to. But we’ve reached a point where it’s no longer speculation that it is going to be a major
part of our economy. It probably won’t be Bitcoin, but blockchain technology is slowly becoming the entire backbone of the internet and the media hosted on it. I could cite multiple projects that would see the use of a cryptocurrency token as even simpler than using a credit card. Fees that are just a few cents, instant transactions, fool-proof security, the use of smart contracts for things like custom content, physical item sales, etc.
This is why I advocate a basic understanding of cryptocurrency. Most major porn sites are currently using some variation of blockchain technology and now are beginning to dabble in the actual tokens (the cryptocurrency). How long will it take before banks and credit card companies and payment processors (who often deem adult services a ToS violation) - with their exorbitant fees, slow transactions, arbitrary content regulations, lack of privacy, and security vulnerabilities - become replaced by a system that is decentralized (not governed by any one individual, government, organization or company), instant, near fee-less, 100% private, and impenetrable from a security standpoint?
As this technology becomes more understandable to the general public (which is sincerely what these crypto developers want) and the traditional markets adopt it (happening now), it’ll become a part of our economic world.
Some notes (not necessary to understand BTC or crypto, but interesting nonetheless):
- The blockchain cannot be hacked. It's impossible to hack a decentralized network because there is no single entry point. The only security vulnerability is having your private key stolen, and the
only way this can happen is if you keep your tokens on an exchange and that exchange is hacked (it's often noted that you should never use an exchange to store your tokens for this reason). Nobody can hack a private wallet - they'd have to literally get the private key from you in person.
- Banks suck. A great interest rate on your standard savings account is .01% APY. The way a bank works is by borrowing your money and lending it to other people. Say I have $10,000 in savings - the bank will lend that 10k to someone for as much as 40% interest, and pay me .01% interest to thank me letting them lend my money and make a ton of profit off of it. I'm not allowed to use my money for whatever I want, whenever I want. And when I do use my money, I have to pay fees (this especially sucks for immigrants who send money back home from America). The bank is routinely fucking me in the ass, and I'm thanking them for it. When I own cryptocurrency, I literally
am a bank.
-
Fiat currency is basically plain ol' money: the US Dollar, the British Pound, the Euro, the Korean Won. Fiat currency is not backed by
anything in the United States. The US Dollar, for example, derives its value from the amount in circulation leveraged against the market economy (goods and services and their fluctuating supply/demand). Literally the only thing that makes a dollar worth a dollar is that everyone agrees that a dollar is a dollar. Cryptocurrencies are actually backed by technology, products, and services - think of a crypto token as a stock in a company (or even more than that - stock in an idea, a service, a product, etc).
- The US Dollar market capitalization is essentially unknown. Only a small percentage thereof is actually in circulation. This is pretty terrifying - the Federal Reserve can create or destroy paper currency at-will, while this unknown capitalization lends to a severe instability in the value of the US Dollar. There
is a possibility that the US Dollar will be tokenized as a digital currency: this would be a blockchain system (decentralized) within a centralized system (the Federal Reserve regulation). The US Gov has been researching doing this for about 5 years now.
- The money in your bank account isn't digital money. It's basically like a certificate attesting that this trustworthy third party (the bank) is holding X amount for you. Despite FDIC-insured money, the bank technically
can default on your money with zero repercussions (e.g. 2008 sub-prime mortgage crisis). They also can act as sole arbitrator of your money in the case that someone claims you owe them money (the bank can liquidate your assets for a debt collection agency). Nobody can seize a crypto asset.
- Nobody actually thinks cryptocurrency will overthrow fiat currency (well, the assholes do, I guess). Cryptocurrency seeks to exist alongside fiat currency and serve more as a technological backbone for money.
- Countries like Venezuela have reached such inflation points that their fiat currency is literally worthless. The entire country of Venezuela now operates on a cryptocurrency economy. In some places, cryptocurrency is a solution to poverty and a severe lack of financial mobility (e.g. Africa, where millions of people do not have access to banking).
- Bitcoin etc is not a "bubble". It's a violently fluctuating asset because it's new. Very new. Currencies have to align with a market in order for their static valuations to be determined. Only adoption and actual use-cases can do this (good thing banks, major companies, and stock exchanges are starting to use it). Cryptocurrency is the only truly global currency at this point in time. Establishing global economies have been the goal of economics for the last century.
Okay fuck...I'm sorry if this
was overwhelming, as I set out to not be. It's a lot of information. I hope this helped make some sense of it all.
I think an important point to put out there is
why a lot of cryptocurrency zealots are douchebags. A lot of it is political disposition: many hardcore libertarians, self-professed anarchists, and just dudes who hate the government cheer for this stuff because it's decentralized and gives you absolute control over your money. Controlling your money is great, but they fail to realize that cryptocurrencies
want to work with governments; they want adoption and to be useful to everyday people.
Another reason is very simple: it makes these guys feel smart. They like knowing about shit that confuses even the smartest of people. But there's nothing cool about understanding crypto; it's just like knowing a different language. If I learn Russian, that doesn't make me smarter than you because you only speak English.
