Is Bitcoin dead? This is probably the hottest question in the blockchain industry of the recent years. The ups and downs of the digital currency behemoth do very little to calm our minds from boggling questions.
Opinions of top-tier business analysts split in half making it even harder to put one’s finger on a clear answer.
“[Bitcoin has] no clear fundamental value and largely unregulated markets, coupled with a storyline conducive to delusions of grandeur, makes this more than anything we can find in the history books the very essence of a bubble.” – Jeremy Grantham, co-founder at GMO
This comes from a guy who brilliantly predicted two major market crashes of Altcoin. Damn, Jeremy must really know what’s going on.
Or does he?
Well, Bill Barhydt, the CEO of Abra has a different opinion that he has shared with the Business Insider:
“I talk to hedge funds, high net-worth individuals, even commodity speculators… They look at the volatility in the crypto markets and they see it as a huge opportunity. Once that happens, all hell will break loose.” – Bill Barhydt
With two clearly distinct camps like these with major business analysts splitting in half without a clear answer, what should we, the simple folk believe? Is there a reason for us to invest in Bitcoin? Is there still a chance to make money mining? Should we forget that it had ever existed and move on with our lives?
To answer that question let’s have a look at the network itself.
A new block
In a world of volatility, the safest bet would be to look for a constant. But what can be consistent in an ever-shifting world of Bitcoin?
Yes, it is as simple as that. The network itself keeps generating new blocks regardless of all odds. When one Bitcoin was worth a couple of cents – the collection, compilation, and verification of data never stopped. Nor did it stop when the price went up to $20K. Nor did it stop when the price went down to $6K.
The network keeps generation new blocks and rewarding miners with Bitcoin every ten minutes or so ever since 2009.
Bitcoin was proclaimed dead for 294 times now and you know what? A new block still pops up every ten minutes. Guess the network doesn’t know that it is dead. Orit simply doesn’t give a shit.
The greatest strength
What differs Bitcoin (or any other Altcoin for that matter) from a fiat currency? No, not the fact that one is entirely digital and the other is made of physical materials.
The paper and paints used in US dollars don’t have as much monetary value. The resource of the currency doesn’t matter. What matters are the things backing up the said currency?
With fiat the math is simple. There is a country that licenses the production of branded papers and calls it money. We all accept them because the ash is usually backed by the gold reserves of said country and gold, as we all know is valuable.
Why? What is the worth of gold?
Well, it is shiny and hard to come by. Then there’s the historical aspect of everyone on the planet agreeing that gold is good – a stereotype we stick to even today.
But what if I told you that this seemingly obvious statement is false. Just think about it – pearls are also rare yet you don’t see them backing up any currency. Heck, a toothbrush is rare and hard to come by in some countries and yet it is not seen as a valuable object.
The only thing that makes gold dear to our hears is the stereotype, the idea of it’s worth. You’d have to be a fool to believe that humanity won’t grow our love for random shiny objects in the nearest future.
Oil, on the other hand, is a much better example of a valuable resource that supports a currency. There is use for oil, as everybody needs gas. For now, at least. And this, my friends, is the reason why the global economy took a shift towards the oil industry.
Ok, now that we’ve covered the aspect of values let’s talk about Bitcoin. What on earth can have enough value to back a completely digital currency?
The answer is simple – technology. Advancement, innovation, improvement – all of these things are as valuable (if not more) as gold in 2018.
We can’t forget that Bitcoin is a simple by-product of the blockchain industry and the real reason there is money in it is simple. Blockchain improves the lives of people in medicine, automotive, IoT, and countless other industries. It has a distinct use, very much like the recent star of the global economy – mistress oil.
Progress doesn’t get cheaper with time. It only increases in value. And so will the Altcoin.
The greatest weakness
If there is a strength to anything in the world, there must also be a weakness. Altcoins like Bitcoin are no different. The funny thing is that the weakness lies in their greatest strength.
Yes, Bitcoin is backed by technology but what do we know about it if not that fact that it constantly grows, expands and updates rendering the previous versions of anything useless?
Take a look at companies like Nokia or Motorola. These guys have singlehandedly pioneered the market of handheld cellphones. And where are they now? Away, tucked in the shade of the new gen kids like Google or Apple.
Then there is Xerox with printers and fax machines pioneering the niche of available information delivered across the world in an instant. We now have emails and the internet for their tasks.
Eventually, Bitcoin will also walk the road of the dinosaurs quickly followed by Ethereum, Dash, and LiteCoin. But by the time that happens, we will have a lot of better, faster, more flexible alternatives based on the blockchain network.
So, to answer the primary question of this blog post – yes, there is life after Bitcoin and it is dashingly promising!