Benjamin Netanyahu, the Israeli Prime Minister (PM) announced in a video published on Tuesday that the works functioned by the traditional banks is going to be outdated in due course which will be replaced by bitcoin. His announcement was because of the distrustful nature of the Blockchain Technology, and the main reason to point out toward bitcoin was its notable growth in this year.
What is Blockchain Technology?
A blockchain originally blockchain, is a continuously growing list of records, called blocks, which are linked and secured using cryptography. Each block typically contains a hash pointer as a link to a previous block, a timestamp and transaction data. By design, blockchains are inherently resistant to modification of the data. Harvard Business Review defines it as “an open, distributed ledger that can record transactions between two parties efficiently and verifiably and permanently.” For use as a distributed ledger, a blockchain is typically managed by a peer-to-peer network collectively adhering to a protocol for validating new blocks. Once recorded, the data in any given block cannot be altered retroactively without the alteration of all subsequent blocks, which requires collusion of the network majority.
Blockchains are secure by design and are an example of a distributed computing system with high Byzantine fault tolerance. Decentralized consensus has therefore been achieved with a blockchain. This makes blockchains potentially suitable for the recording of events, medical records and other records management activities, such as identity management, transaction processing, documenting provenance, or food traceability.
The first blockchain was conceptualized in 2008 by an anonymous person or group known as Satoshi Nakamoto and implemented in 2009 as a core component of bitcoin where it serves as the public ledger for all transactions. The invention of the blockchain for bitcoin made it the first digital currency to solve the double spending problem without the need of a trusted authority or central server. The bitcoin design has been the inspiration for other applications.
In the video which has been published Prime Minister Netanyahu emphasised that the traditional banks are going to be replaced by the Bitcoin. This video has become a promotion for the spread of bitcoin.
He stated that:
“Is the fate of banks that they will eventually disappear? Yes. The answer is yes. Does it need to happen tomorrow? And do we need to do it through Bitcoin? That’s a question mark.”
The head of the Israeli sates also said about the role of Banks by explaining how they are used and how its functions. It is said that they were created and continued to exist to make sure that everything is valid and secure that is the transactions between two parties. Also noted that the Banks have grown from the cost of transacting parties and began to control how money is spent and benefit from that control.
Blockchain which is the underlying technology of cryptocurrency makes it possible for people the transactions directly. Rather than a centralised institution, the decentralised technology itself ensures the transactions between people are valid and secure.
Netanyahu acknowledges the significance of Bitcoin
“The truth behind what I just said is what’s propelling Bitcoin upwards.”
However, the prime minister also expressed his confusion in the ability of Bitcoin to continue growing at such a startling rate, by stating that:
“There’s nothing like this, that will continue rising at this rate, it can’t happen.”
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