Crypto Beans #21 Bitcoin is digital power, the strongest defense in the AI cyberworld

Hey there everyone! 👋 This is Shivam. I bring to you the 21st weekly edition of Crypto Beans. This is an effort through which I try to share my thoughts on the crypto space and help you stay updated. Your 0 to 1 guide in crypto.

Read time - 4 mins

In this edition, the article I explore is titled "Bitcoin is digital power, the strongest defense in the AI cyberworld" Hope you enjoy it.

Spill the beans (Explain to me like a 5 year old) 

Can Bitcoin be a network that is resistant to attacks in future, more like nation state attacks

Now, to explain where I am going with this, I will start with the basics first,

1} What makes Bitcoin digital power?

The highly decentralized nature of the nodes that store that blockchain and Bitcoin is basically the network of bitcoin miners. And the bitcoin miners represent digital power

This is because in order to secure the network miners generate 360 ExaHash/s of digital power right now. So basically they take raw energy in the form of electricity, and then they modulate it through custom semiconductor chips to carry computation

This converts analog energy into digital energy, or in this case, analog power to digital power

You may ask what is the significance?

Well, this makes bitcoin network the world's most secure cyber network because it is backed by the greatest amount of digital power in the world

Also, as the network continues to grow, it creates the a more secure computer network in the world. The security increases with increasing hash rate.

Let me explain

If I had 1 Exa hash vs if I had one 350 Exa hash rate, which would be much easier to crack the network or to interfere with the transactions. It's easy .... so, as the hash weight grows, a wall of encrypted energy is built around the network

The ability to send a message and to transact on the network is protected by this shield of digital power

2} Now, let's compare it to the national security and why it may be the future of the any nation state

So, to think of this. If you have an army, you have land power, and an army will protect you from an attack via land. If you have a navy, you have naval power. Naval power allows you to keep the sea lanes open, and you can pass a goods and information

Then, you have air power for which you need an air force, and airplanes carry that air power. And the ability to deliver that power is what allows you to maintain control your airspace.(More the fighters, more is your power in the space)

We also have other powers that are becoming increasingly important like Nuclear power and Space power. If you gain control of space, you gain control of GPS and things like broadband communications. It can be used to do things like control drones in the Ukraine war or monitor weather. Now we have added a layer of complexity. With the advent of AI future conflicts may be:

Cyberattacks..... or Drones that are controlled via satellites or Misinformation spread by AI bots. This would be the advent of Internet warfare, hijacking banks, crippling economies (US already does that through sanctions)

Future wars may be cyber warfare which would be amplified by AI and that means in the cyber world, Bitcoin will become important. This is because Bitcoin will be the world's greatest cyber defense system

Here's one example to understand how Bitcoin will come into the picture

If you have to authenticate and prove information to transmit messages through a system or any given cyber system. You're going to need a system which is resistant to attacks by nation states. You're going to want a wall of digital energy. A wall that is big enough for anyone to break it down.

Eventually, if someone puts information on Bitcoin to be transmitted, no government or AI would be able to twist it to their own advantage or crack it down. The deep fakes could be distinguished from originals through on-chain verification where AI bots would become pointless. There would be noise all around but still a source of truth for everyone to see.

Here's a table for understanding Hash-rate (#calculations done)

State of Crypto affairs - A quick look at the market 

The global cryptocurrency market cap today: $1.17 Trillion

Weekly change: -6.50% | Yearly change: -13.04% 

Bitcoin (BTC) is the largest cryptocurrency with a market cap of $520 Billion.

Weekly change: -7.05% | YTD change: 61.49%

Another important metric is Bitcoin dominance which can be used as a rough indicator of the relative strength of Bitcoin versus other cryptocurrencies. A high Bitcoin dominance means that Bitcoin has a large market share and is potentially more influential in the overall cryptocurrency market and vice-versa.

Bitcoin dominance: Current Year: 47.08% | Last year (May 2022): 44.22%

Greed and fear index 

The market sentiment has been a bit neutral now post Bitcoin dumping in the last week.

Note: The data used is based on metrics like Volatility, Surveys, Bitcoin Dominance, Social and Google Trends. Source: Coinstats

Is ETH ultrasound money? 

Let's have a look at Ethereum supply changes post its merge to a PoS blockchain from PoW, as there is a shift in the narrative for Ethereum to become a store of value due to the expected reduction in ETH emissions.

Supply change since merge POS -227,520 ETH

The graph highlights POS vs POW issuance since the merge. Impressive numbers, look super bullish for ETH long term given the supply of ETH is not growing as before

What's brewing today? Bringing fresh beans to you: 

Among Bitcoin Developers, Debate Is Raging Over Whether to Censor Ordinals BRC-20s: Despite calls for censorship, many developers agree that maintaining the status quo is the right thing to do for now.

Binance Announces Exit from Canada, Citing Regulatory Tensions: The world’s largest crypto exchange by volume said new guidance related to stablecoins and investor limits prompted the exit.

Elon Musk Sends Milady NFTs Soaring: Miladys NFTs saw a brief pump after Elon Musk tweeted about them and Binance is making it easier for people to buy Bitcoin NFTs.

Whats meme-ing? Better make sure this is fun

And now the funny part,

What did you think of today's edition?  

Reach out to me on Twitter or Linkedin for any feedback :)

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.