Review of Bloomberg’s article ‘Bitcoin Is the New Gold’
Noah Smith of Bloomberg published a rather interesting article that I wanted to share with you and give a few thoughts of my own.
[Bitcoin] transaction confirmation times have risen substantially; this, in turn, has led to an increase in the failure rate of transactions. … By the time the transaction is confirmed, fluctuations in Bitcoin price mean that it’s for the “wrong” amount. … Furthermore, fees have risen a great deal … making Bitcoin transactions about as expensive as bank wires.
Yes, even a Bitcoin conference in Miami refused to accept Bitcoin for its attendance fees, but we should not make any conclusions just based on few negative news. Bitcoin is here to stay for a long time even though there are better, faster and cheaper technologies to use.
Noah keeps writing in his article that It’s very possible that all of these technological problems will be overcome, either by Bitcoin or by rival cryptocurrencies. Lots of smart people are working feverishly on solutions. But there’s also an economic reason why Bitcoin and other cryptocurrencies will never be useful as money. Things that are good financial investments don’t make good currencies, and vice versa.
Have to disagree with him on this one. Bitcoin indeed has issues such as costs, power consumption and scalability, volatility and etc., he is missing the point. Even after taking a beating in recent weeks, it still trades for $10,000 a coin despite all the risk factors. It has paved way for blockchain applications and companies to start up in every industry imaginable. The world is aware Bitcoin has issues, yet are still willing to risk top dollar despite those issues. Yes the market is in a lull, as they wait to see what happens next be it regulation and overall market stability, it is part of the maturation process.
Companies will solve these problems soon, and Bitcoin may be replaced, but blockchain is here to stay. A coin named Hyrda will be launching in coming weeks that has solved the scalability issues, the forking issues, the user fees, the transaction times and security issues, centralisation issues…and if they do not climb to the top, another technology eventually will. Bitcoin allowed the industry to build the infrastructure, it paved the way for all others. Technology evolves fast, and though there is risk, it can be reduced by numerous diversification opportunities that now exist thanks to Bitcoin. And let’s not forget Ripple, Stellar Lumens and many more.
But thank you Noah for this article. It gave me some very good thoughts and ideas.
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