azeem ?@azeem 2h @wadhwa bitcoin reminds me early packet vs circuit switched shift. The benefits ultimately really felt when the consumer experience is easyLet me try to explain for you "beginner geeks".
The telephone started out by working over a pair of wires. That is, the two telephones were connected together with a battery tossed in and you could talk. In order to expand beyond just two fixed parties talking, switchboards with humans were added. Then we advanced to being able to dial the other party and the circuit was established by mechanical switches rather than operators with cords and a plug board.
Once long distances needed to be covered, amplification was added to the circuit. The next step was a cost reduction measure where multiple channels were run over the same piece of wire but, effectively, you had a dedicated wire (or, more accurately, circuit) to talk over. This is called a circuit switched network.
In the world of data, packet switching quickly evolved. That is, what you want to send to someone is broken up into packets (short blocks), sent on a wild path and then reassembled on the other end. Easy for data but telcos told everyone that it would be impossible to move telecommunications from circuit switching to packet switching.
Clearly they were wrong and today's telephone system consists of pieces of wire running from your phone to a phone office where the information is digitized and packet switched. While it may have been impossible, packet switching took over with the following big benefits:
- The price of a long distance call dropped significantly because so much less equipment was tied up to handle it.
- All that background noise on a long distance call went away because the amplification is now done digitally.
But, all this happened without you having to make any changes. That is, the phone in your house remained the same. While most people understand the big price drop in long distance costs, they don't know why. The technology change was transparent to the consumer.
This is what will happen with bitcoin. Some geeks will know what is happening but most consumers will just see a drop in overhead costs to use this new money.