Our Experts Explain

Last month we published a few articles about Cryptocurrencies and Bitcoin. Did you know that Bitcoin can be used for more than just monetary purposes?

Because Bitcoin utilises Blockchain technology (a public, distributed, synchronised and encrypted database), bitcoins themselves are very secure and can therefore be used to represent numerous pieces of data, not just currency.

If governments were to formally accept block chain IDs, they could issue legal documents in digital form instead of physical paper documents. For example, passports, marriage certificates or medical records could all be stored via the blockchain. This could come in very handy if you were injured overseas, as your records would be available instantly, anywhere in the world. Estonia has already started linking marriages using the blockchain.

1 bitcoin = 100,000,000 units. Each unit can be individually programmed and identified. A bitcoin owner can assign properties to a unit. They can essentially programme a unit to represent anything.

A unit could represent:

  • an Australian Dollar
  • one share in a company on the Stock Exchange
  • a kilowatt hour of energy
  • a digital certificate of ownership

Bitcoin is not just about money and payments. It can represent numerous kinds of property: 100 barrels of oil; loyalty credits; or a vote at an election.

Bitcoin currency can also make us smarter with our money. Imagine a world where people were given a Healthcare allowance, in say AUD or Euro, which could only be used to pay for Healthcare at a list of nominated providers. No one needs to check that it has been spent correctly, because the spending rules have simply been programmed into the bitcoin itself, therefore compliance is guaranteed. The bitcoin could even be programmed to transfer back to the provider if the recipient hasn’t used it within a set time-frame. This would eliminate hoarding of allowances.

Businesses could even use this programmed currency to control department spending. Budgets could be set with allocated funds for salaries, maintenance, materials etc… and those amounts cannot be spent on other things. This forced compliance would decrease the need for government regulations and be a huge time-saver for accountants and controllers.

The uses for bitcoin and the blockchain are endless and it is only a matter of time before we see it become a part of our everyday lives.