In the last blog we announced that Casa Tabanero is going to accept Bitcoin as a form of payment. To lay the foundation for understanding Bitcoin, which is a form of cryptocurrency, we talked about the nature of money in general. If this were a rollercoaster, and the metaphor isn’t that far off, then the last blog was the slow upward climb to the peak. That means this week is the fast downward dive full of twists and turns.
So, buckle up.
Here we go!
Bitcoin is a digital cryptocurrency using a distributed ledger of block chains. Say What? Let’s break it down. Analog currency is physical, like paper dollar bills or copper pennies. Digital currency is electronic numbers being stored – well, somewhere. When you use a debit card to buy something, it is a digital transfer of numbers from one account to another. So far, so good. Bitcoin was first created in January of 2009 by an unknown person, or persons, identified as Satoshi Nakamoto. His, her, or their intention was to create a decentralized digital cash system. That means that it would function the same as using your debit card only there wouldn’t be a bank involved. Instead it would be shared by a community. It’s like this :
Look at your phone. Now imagine that you type something on it. As you type it the words show up on your friend’s phone. Okay, I know. That’s nothing special. You do that every time you send a text message. Now imagine that ten of your friends get that same message. Again, no big deal. That’s a group text message. Now imagine that whole population of the France gets that same message. That’s a pretty big group text.
Blockchains work similar to that concept. Only, they are much, much, muuuuch more complex. You have an account with Bitcoin. That account is in the cloud (don’t get us started) and on your device of choice too. You decide that you want to buy an amazing hand-made cigar from the best cigar boutique in the world. You open the Bitcoin app. You choose to give a Tabanero Cigars (of course, we’re talking about Taba!) 1/1000th of a Bitcoin. Your account will show that transaction. The account at Tabanero will show that transaction. In less than ten minutes, every account will have that transaction too. You have just used an uber -modern method to enjoy an old-world delicacy.
But wait! How safe is that transaction when everyone sees it? First of all, only you and Casa Taba ‘see it.’ The massive ledger sheet is behind the scenes so to speak. Security? Bitcoin uses the most advanced cryptology known. We could explain it – well no really we can’t. The point is that this cryptocurrency is more security than a bank transaction. Plus saying Crypto remains us of Superman and that is always good.
As a follow-up we can give a deeper explanation of how the cryptology works. Better yet, come to Tabanero, light up a handmade artisan cigar, sit down in one of our comfortable leather chairs, and let’s talk about Bitcoin. We’ll be accepting bitcoin very soon in our store. Stay tuned and watch for that!