Bitcoin > Fiat Currency

IBM introduces a blockchain to verify the jewelry supply chain

What's the story?
IBM has been building for the past few years a variety of blockchain projects. Today they are launching Trustchain, a platform for tracking jewelry on the blockchain. A range of large jewelry suppliers have signed up such as Helzberg Diamonds. IBM touts that they are converting a paper process to a digital one. IBM is hoping by next year that you can scan a QR code on a diamond and see the whole supply chain on the blockchain. 

Why Does This Matter?
Apparently, every industry needs blockchain. While the diamond industry is filled with fraud, I don't see how blockchain solves this problem. Blockchain proves that the information entered has not been altered, but when you have a process occurring off of the blockchain, you have no way of verifying if the data entered is correct. For example, if someone enters into the database that a diamond comes from South Africa, but is lying, there is no way to verify this. Many of the applications that people mention for blockchain involve off-chain transactions, and there is still no way to check this.

Cryptocurrency Has Potential to Threaten Fiat: South Korea’s Finance Minister

What's the story?
South Korea's Deputy Minister of Strategy and Finance wrote, "Cryptocurrencies like Bitcoin and Ethereum, which led an investment and speculative bubble earlier this year, have stabilized and are leading both the authorities and investors to question the foundation of the fiat system ... the central bank should consider the emergence of alternative payment methods such as cryptocurrencies as a threat to the existence of the traditional fiat system." 

Why Does This Matter?
Imagine the Federal Reserve President saying Bitcoin might replace the US Dollar. That would be a big deal. While not entirely on the same scale, this is the first time I have heard a government official calling cryptocurrencies a threat to fiat currency. I disagree that cryptocurrency will replace fiat currencies. As long as their armies, cryptocurrencies will remain supplementary to fiat. 

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