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The article presents some long term and optemistic possibilities of making bitcoin irrelevant but I'm not that convinced. I'm by no means a bitcoin maximalist
by qqii 6y ago
The article presents some long term and optemistic possibilities of making bitcoin irrelevant but I'm not that convinced.
I'm by no means a bitcoin maximalist but the trust and network effect of bitcoin is something every other cryptocurrency struggles with and difficult to replicate.
I believe a government run blockchain is a likely outcome, but this doesn't share many similarities with Bitcoin. The currently common rhetoric is that Bitcoin's 21 million limit is a hedge against inflation and a government blockchain won't satisfy people looking for this.
The Facebook sneak attack it proposes has two avenues - it's own token (and we saw how that went) or taking over. The possibility of an more insidious takeover is already a possibility now that vendors like PayPal allow you to buy cryptocurrency. PayPal's version of Bitcoin is already nothing like Bitcoin - only PayPal can hold it for you, you cannot sent it to others or spend it and others cannot send you more.
The problem is that even if PayPal or Facebook could capture a large user market that doesn't give miners much incentive to switch to their fork. When they forked it would be world news and I'm sure they'll have lawsuits and people demanding their private keys.
I find the third option the most likely, but who knows how long it will take and if it will happen. As a new digital currency bitcoin has had the fairest distribution, currently the greatest hashrate and if you include wBTC and it's variants it still finalises a lot of value. For an already complex idea it has name recognition and is relatively simple and understandable in design. It's hard cap of 21 million and stage in the distribution cycle can only be replicated in time.
Even now by many metrics Ethereum has an advantage over Bitcoin but as the article point out is only a third of its market cap. Even if Bitcoin's market dominance dropped in the short term it's unlikely that the distribution would favour a single project.
To conclude I'm not convinced that Bitcoin's stop of greatest cryptocurrency market cap will be replaced in the short to medium term of 10-20 years.
- twox2 6y ago"As a new digital currency bitcoin has had the fairest distribution," Not sure I agree with this, but I guess it depends what your definition of fair is. I think something like 2%-5% of BTC wallets control like 90% of BTC.
- ivanche 6y agoIt's even worse. According to [1], around 2.18% of addresses control around 94.75% of BTC. [1] https://bitinfocharts.com/top-100-richest-bitcoin-addresses.html https://bitinfocharts.com/top-100-richest-bitcoin-addresses....
- cdiddy2 6y agothat includes exchange addresses though. each exchange address can hold BTC for millions of people
- ivanche 6y agoYou're right, it includes exchange addresses. Although my stance is, other people's address == other people's BTC. They might temporarily be a custodian for you but sooner or later something bad will happen.
- tromp 6y agoWith half of all bitcoin emitted in just the first 4 years of existence, it's not very evenly distributed. Yet most other cryptocurrencies have an even worse distribution, especially those with premines.
- okprod 6y agoI think in the long-term the first scenario will happen more so than the third, and the second, even if it does, will just be how Bitcoin is treated now. It's unlikely national governments will allow an unregulated digital currency to not be under their control, both from regulatory and economic angles.
- qqii 6y agoThis market cycle we've already seen countries place more regulations on cryptocurrencies as an asset class yet Bitcoin's market cap continues to grow. People that follow the narritive of bitcoin as a hedge against inflation will still tend towards bitcoin.