Hello and welcome to a nother lesson on blockchain. And in the previous video when I was talking about centralized, decentralized and distributed systems, I mentioned that blockchain is a decentralized and a distributed system. But there are elements that aren't on that there are elements that are centralized heavily centralized, and I will give a example a few examples in a moment and what do I mean by that? blockchain in itself is definitely truly distributed and decentralized. So at its core, it is but there are there are applications so let's talk about the case of Bitcoin because that is the most popular application though. So why Bitcoin there?

Coin that also in itself is decentralized and distributed. But with Bitcoin there is something called exchanges and exchanges. Just I'll be covering this in a separate video in more depth. But essentially exchanges allow the facilitation of transfers and transactions to take place a lot easier from the users perspective, it's just a friendlier interfaces just a lot easier to do it that way. Think of an exchange or like a bank, essentially, they help facilitate that. They're essentially an intermediary and it is the intermediary that is central centralized and as a lot of blockchain applications, one of the biggest been Bitcoin uses intermediaries there are centralized, there comes the problems that you naturally get with centralized systems in that they have their own policies.

Just as system like PayPal and banks do a MasterCard and Visa do if something goes wrong with them, there's a good chance that they could essentially use your own truck in the case of currencies or Bitcoin, for example, they could lose your currency and that had happened. Another great example. And that is man Gox. In 2014, they were suspended. So in 2014, they were suspended because they lost night in the 700. He was eight Hundred and 50,000 bitcoins at a time that was worth roughly I think 400 or so, million dollars.

So at the time, they lost $400 million worth of Bitcoin. If you look at today's market value, which is just shy of $5,000 that same 850,000 bitcoins will be worth over $4 billion, so $4 billion worth of bitcoins were lost from Mount Gox which is an exchange, man Gox at its height, was handling over 70% of the bitcoins on the market, it definitely had a monopoly. And it lost all of it. There were a mixture of reasons why the coins got lost. Fortunately, over 200,000 have been retrieved but there have been there are many reasons why the coins were lost. There were there were theft, the obvious one, theft occurred and the bitcoins were lost.

So people within the company, were taking coins and I think they had been doing that since 2011. So since 2011, so three years, they had been stealing. And I'm gonna say money, just to bring it home to you what exactly they were doing. And there were a bunch of other reasons. I think there was hacks involved and there was so many other factors that occurred to them. losing it.

And I think the most important thing to take away is they were centralized. And we had this amazing system called blockchain, which facilitated transactions. They could be transactions of money of wills of educational achievement. And on top of that, Bitcoin was built and various other platforms as well Bitcoin, the being the biggest one. And again, that was an amazing platform that was decentralized distributed and it was essentially a money based platform and what it has been used for, but on top of that, to aid the ease of use, we had exchanges. I'm not going to say mount Gox here because just exchanges in general and these exchanges on centralized on positive in the future we'll get some form of decentralized and distributed exchanges.

It is early days in blockchain and Bitcoin and like many other application of blockchain, but there were there are several exchanges there. Obviously the was mt Gox. The block chain dot info and that allows the fear in transactions on top of Bitcoin as well. There's Coinbase, which at the moment is one of the most widely spread forms. There's c e x.io, which is fantastic. There is Genesis.

Genesis is mainly for bigger transactions like a lot of these will own up before For like a small beginning account only allow transactions over like a few hundred dollars. Genesis, I believe, only allows transactions above 25 or so thousand dollars. So that's more for corporations or overall just rich people that are looking to transfer large amounts. But all of these are centralized Coinbase, which I said is one of the most popular one has, if you look at the terms and conditions and their privacy policy, there are similarities to paypal and that's definitely definitely not centralized. I mean, that's definitely not decentralized and distributed that centralized. So, that is what I meant by blockchain having elements of decentralized and distributed I mean, having Yeah, having centralized features within blockchain is more In the implementations, so I hope that helped clear that up and thanks for watching.

If you have any questions, feel free to reach out and I look forward to seeing you in my next video.