CD-45 candidate David Min is the endorsed candidate of the California Democratic Party; it’s crunch time and he’s airing TV ads and the newest one targets his Democratic opponents instead of Republican Congresswoman Mimi Walters. Min goes after Porter for accepting large contributions from Washington insiders and after Forde for large contributors from special interests associated with Bitcoin and Cryptocurrency.
One could argue it’s a logical response to attacks from the non-endorsed candidates still in the race for Congress and fair play.
Except for one tiny detail.
Min associates Bitcoin and Cryptocurrency with drug crimes and human trafficking. And that’s it.
I just about spit my coffee when I heard this. It’s a misrepresentation at best. Cash, wire transfers, illicit products are also used as currency on the Silk road and the Dark Web. But there’s more to Bitcoin, Cryptocurrency and Blockchain than bad stuff.
Bitcoin is a cryptocurrency — of which there are many. Digital “money” that changes in value much like a share of stock does. There is not a lot of regulation around this technology yet frankly because legislators don’t really understand it. But the market will force some rules on cryptocurrency sooner than later, and have. But Crytocurrency and the Blockchain technology used to make this work are the tech building blocks on which billions of dollars in investment globally will transform transactions and wealth in weeks, months, and decades to come.
Cryptocurrency could if fact become a global universal currency at some point and the entire concept is only about five years old. Bitcoin and Blockchain are a global $700 million market which offers incredible opportunities for great paying jobs. See this story in CNBC earlier this month which is positive about cryptocurrency. Now imagine these jobs in CD-45 where there’s a lot of financial institutions, insurance and security technology companies. Could be great news for the area’s economy.
Here’s how it works
Bitcoin is peer-to-peer payment system based on open source software with payments recorded in a public ledger. A unit of account is called a Bitcoin which is used as a means of payment for work. Bitcoin users confirm and record payments into this public ledger which can also be used to pay for products, money and services where users can exchange Bitcoins. Transaction fees can be charged after they have placed a bitcoin wallet on a computer, tablet or smartphone — or even a website. These fees are less than fees credit card companies charge.
Once you have a Bitcoin wallet, you can create a Bitcoin address and share this address with friends or business associates to send or receive payments.
Blockchain technology, which is used for a lot more than cryptocurrency, is a shared public ledger that confirms every transaction in the Blockchain network. This is how Bitcoin wallets can ascertain balances and new transactions owned by the spender. Cryptography protects the Blockchain network. When a transaction is made, there’s a transfer of Bitcoin value that’s added to the blockchain where the wallets use a unique piece of encrypted data called a private key which electronically signs the transaction and offers technical proof the Bitcoin has come from the owner of the Bitcoin wallet. The private key cannot be changed once its issued and transactions are confirmed after a short time through a process called mining.
Now the very nature of Bitcoin makes it the currency of choice for hackers who engage in Ransomware lockouts. There was a police department in New England that paid a hacker in Bitcoin after being locked out of its own network. The city of Atlanta had parts of critical applications locked out by ransomware. And I’m certain sophisticated drug and human trafficking operations also use cryptocurrency for transactions. But criminal elements also use cash, wire transfers to offshore accounts, money laundering from business and banking enterprises. Cybercrime is a global $6 trillion a year problem by 2019 according to Garter, an industry analyst.
Think of Bitcoin as a form of payment for services and products that’s growth dramatically and businesses who transact in Bitcoin and other cryptocurrencies have fees that are dramatically lower than what credit card processors and commercial banks charge. One study suggests that while Bitcoin is best suited for small purchases now, eventually Bitcoin and cryptocurrency can be seen as an alternative to gold as a safe investment. Buyer beware on this and do your homework.
Forde, on the White House’s technology team during the Obama administration, is an expert in Bitcoin, Blockchain and Cryptocurrency and routinely brief President Obama on key developments. This is likely why Forde is getting contributions from this industry.
David Min has much to offer as a candidate for Congress, but using Bitcoin and cryptocurrency’s dark side as a negative against another candidate just tells me he doesn’t fully understand the enormous upside to this transformative technology. I hope he reads up on it.