MILWAUKEE SCHOOL OF ENGINEERINGMemorandumTO: Professor ZimmermannFROM: Alexander WilasDATE: January 22, 2018SUBJECT: The history of Bitcoin and cryptocurrencyBackgroundBitcoin was the world’s first type of decentralized digital currency, also know as cryptocurrency. It works without a central bank or administrator overlooking the trading of coins. The network is peer-to-peer which means computers interact with each other in order to send and receive coins. These transactions are verified by network nodes through the use of a blockchain. The blockchain is a public ledger that records and stores all coin transactions. Not only is it public but it cannot be deleted or altered. The blockchain technology was created by a person or group of people going by the pseudonym “Satoshi Nakamoto” in 2009. With a market cap high of almost $800 Billion USD it’s fairly obvious that we’re dealing with big money. The Bitcoin ObsessionThe mainstream media has headlined and focused on Bitcoin for a few years. Calling it a “bubble” or “ponzi scheme” year by year but, after surviving a few detrimental crashes Bitcoin still thrives and proves to the world that it’s technology is worth too much to be destroyed. Bitcoin has made people millionaires and even billionaires out of people who wouldn’t have been able to achieve this through the traditional finance system. Price of Bitcoin from Aug 16, 2010 – Jan 21, 2018The price of Bitcoin went from a fraction of a cent to an all-time high in late 2017 where it hit $20,000 USD per coin on some exchanges. With its limited supply of 21 million coins the coin is bound to increase in value because of supply and demand. But with a limited number of investors this growth with soon reach a tipping point and eventually plateau. Unsure of when that time will come investors are afraid of the possible bubble that they may be in. The “Bubble” The current market is based purely on speculation and not actually backed by company performance like it is on the stock market. This worries serious investors and backers when they begin to hear the general public hopping onto the Bitcoin train in fear of missing out on unbeatable returns. People easily fall into the ‘get rich quick’ trap, but with an understanding of the market and it’s coins can continue to make massive returns from altcoins. Eventually investors will begin to lose confidence and interest as a result of profits slowing down, government regulation, or consistant negative media attention. Mainstream media BiasThe media is just waiting until the day they’re able to post a headline stating “Bitcoin prices plummet and is now valueless” with the entire world laughing and bragging about how they saw this coming all along. Mainstream media outlets post an article every time there’s a dip in the market as if they’re trying to prove a point. They rarely discuss the unbelievable returns that override these dips each and every time. The media will exaggerate everything and have headlines like “Japan bans cryptocurrency” when they’re actually drafting legislation to make a small change in the taxing of cryptocurrencies. Creating unneeded panic to an extremely small change in the grand scheme of things. Governments and banks need to take a more serious approach to cryptocurrencies and accept the fact that they’re here. Summary We need to start to focus on the positive side of cryptocurrency and it’s Blockchain technology. Although Bitcoin might not exist in the future, the technology will have began a snowball effect creating a world of decentralized digital currencies. The current technology is new and it’s not perfect, but we should make an effort to take advantage and built on it to see where it takes us. Billionaires laughed at Bitcoin a few years ago and now most of them have invested into the technology in hopes they’re previous statements are proved wrong once again. Mark Zuckerberg shared his positive thoughts on Blockchain and his hopes in implementing it into his 2 Billion Facebook Users. Perhaps when one of the richest people in the world is positively spreading the word of cryptocurrency it’s time to embrace and benefit from it during its infancy.