Over the last few years, Bitcoin has burst into the public consciousness as a revolutionary new technology that is set to transform everything we know about money, property ownership, legal contracts, record keeping, and much more.
Since most people are still new to Bitcoin, we'd like to answer a few questions to help you become more acquainted with Bitcoin, and to explain how ArtéQuesta will be using Bitcoin to beneﬁt our investors.
Not controlled by any banks, governments, or corporations, Bitcoin is most commonly known as a global, decentralized, peer–to–peer currency which enables instant payments between any two parties around the world — with no transaction fees, no delays, no chargebacks, no censorship, and no security/privacy risks. Sending a Bitcoin payment is as quick & easy as sending an email and Bitcoin is accessible to everyone, regardless of age, race, country, or ﬁnancial status.
The momentum behind Bitcoin as a payment method continues to grow, with well—known companies such as Microsoft, Dell, Expedia, and Overstock.com all accepting Bitcoin payments on their websites. Rand Paul even became the ﬁrst U.S. Presidential Candidate to announce that he will accept Bitcoin donations in his 2016 campaign.
But the power of Bitcoin goes way beyond currency. The Bitcoin network is revolutionary in that it records every single transaction into a shared, public, immutable, fully transparent ledger called the Blockchain. The concept of a shared public ledger is a technological breakthrough that was not previously possible, and it opens up a world of possibilities that go far beyond instantaneous payments.
ArtéQuesta CEO Rayah Levy recently gave an interview about the virtues of Bitcoin and its applicability to the world of art investments. Not only does ArtéQuesta accept Bitcoin for artwork purchases, but ArtéQuesta will also be using the more advanced features of the Blockchain to track the provenance and sovereignty of artwork ownership.
Bitcoin is controlled by a decentralized, peer–to–peer network of computers, all working together to keep the network secure. The network is completely open to anyone, and you can even help secure the network yourself with your own computer!
Currently, the Bitcoin network is the world's most powerful and secure network. It is more powerful than all the world's supercomputers combined, which means that it is practically impossible for any hacker to disrupt the Bitcoin network.
Meanwhile, the current system of banking & payments is centrally run, giving hackers and thieves easy "central access points" to cause widespread destruction & security breaches. For example, 100 million customers of Target and Home Depot had all of their private information & bank account information stolen. Data breaches such as these happen almost every day, and they lead to even greater problems such as identity theft.
From a purely ﬁnancial perspective, one of the best things about Bitcoin is the fact that it is deﬂationary in nature.
Unlike government—controlled bank notes ("ﬁat currency") which are printed out of thin air and are not backed by any assets such as gold, there is a strictly limited number of Bitcoins. There will only be 21 million Bitcoins in existence. The advantage of this is that Bitcoins will retain their value over time, because they will not lose purchasing power due to inﬂation (aka "printing money").
Due to inﬂation, the purchasing power of government-‐controlled currency decreases each year. For example, did you know that $500 could buy you a brand new car in 1913? How much of a brand new car could you buy for that price today? This loss of purchasing power will never happen with Bitcoin, because there will only be 21 million Bitcoins in circulation.
But don't worry — we will never run out of Bitcoins, because each individual Bitcoin is divisible to 8 decimal points, ensuring that there are more than enough currency units to support an entire global economy of billions of people.
And because Bitcoin is a global currency, it can be used anywhere around the world with no currency exchange fees or expensive transaction fees.
Plus, Bitcoin's network is completely open, decentralized, and peer–to–peer. This enables, for the ﬁrst time in human history, the electronic transfer of money which is instantaneous & irreversible. There are no minimum or maximum amounts, no transaction fees to receive payments, and Bitcoin is far more secure & more private than traditional methods of payments. You don't even need a bank account to send & receive Bitcoin payments.
The biggest reason for ArtéQuesta's interest in Bitcoin is the Blockchain technology powering the Bitcoin network.
The entire Bitcoin network works by recording every single Bitcoin transaction into the Blockchain, a public & unchangeable ledger of all Bitcoin transactions. Traditionally, this ledger has been used for recording the transfer of payments from one party to another.
But an extra feature of the Blockchain is that you can "attach" encrypted documents into your Bitcoin transactions, and these attachments can never be altered or deleted. What this means is that the history of artwork ownership can now become fully transparent forever. In the art world, where proof of ownership is still a very contentious issue, the Blockchain is a revolutionary, exciting, and simple solution.
Here at ArtéQuesta, we plan to incorporate Bitcoin's technology by using the Blockchain public ledger to track Certiﬁcates of Authenticity and market value purchases from buyer to buyer. Through this process, we will be able to signiﬁcantly decrease risk & increase safety for current and potential investors who choose to utilize it.
To learn more about Bitcoin, we recommend the following external resources:
- Interview with ArtéQuesta - Securing Art on the Blockchain
- Video - What Is Bitcoin?
- Video - Bitcoin 101: What Happens When We Decentralize Money?
- Video - The Real Value of Bitcoin and Cryptocurrency Technology
- Video - Bitcoin 101: A Million Killer Apps
- Video - Bitcoin vs. Politcal Power
- Website - A Beginner's Guide To Bitcoin by CoinDesk
- Website - Bitcoin 101 by Brave New Coin
- Book - Bitcoin: The Future of Money?
- Book - The Age of Cryptocurrency