Are cryptocurrencies about to go mainstream?
theguardian.com
theguardian.com
Because at the end of the day, privacy is nowhere near as important to many people are it arguably should be, and trying to market cryptocurrencies as 'independent from government control' is likely a losing proposition.
Same with most of the reasons involved I've seen invoked for why to use Bitcoin or the likes online. They're logical, but they're also likely to fly straight over the heads of most of the population.
Add the deliberate way that governments and the media try and portray cryptocurrencies as being used for 'criminal' purposes (which has given these currencies a bit of an image problem), and you've got something that seems very unlikely to ever truly go mainstream.
Seems to be winning in China. I'm sure other countries with strict capital controls will experience similar things.
Joe will probably be the last one to join the crypto takeover - but he'll still have exposure via pension funds and ETFs.
I think governments portraying crypto as being for "criminals" is the equivalent of marketing a truck as "military strength".
"Look at all these people getting rich without any work, you can too! Just buy this convenient financial product I happen to be selling!"
I'd have hoped the mania would die out once the supply of people with technical skills was exhausted, but it looks like people are hard at work extending the bottom of the pyramid to cover the usual victims.
People with common sense? Governments (the institutions that get to use guns and jails and make laws) will not let their control of currency slide out from under them. Blockchains are cool and fun and applicable, but I can't see crypto-currency-as-money becoming mainstream. Even if it does the governments of the world will not adopt Bitcoin, they would make their own.
Much more likely it will be outlawed or go the way of the beanie baby. Optimistically it could remain as a financial instrument on some sort, but IMO the only reason people value btc at all is because they think it will "go mainstream". When this doesn't happen either by legislation or force the value will disappear, and with that its utility will as well.
What if they aren't such a good thing?
How about the fact that paying with something like Bitcoin is (energy) inefficient, inconvenient and slow?
http://www.npr.org/sections/money/2016/04/13/474135422/episo...
Now, OpenBSD is another matter entirely...
Two decades later Microsoft is doing quite well and Linux still accounts for a small percent of personal computers.
I certainly consider my phone to be a personal computer nowadays.
It has a few orders or magnitude more powerful hardware and can do things my first few PCs could not do.
Linux is certainly doing very well there. ;) GNU/Linux might not be, but that's a different story.
I could see crypto currency replacing Western Union, for sending money to family far away. Replacing credit cards has some gaps on both the consumer and merchant sides.
The developing world might have been impressively advanced adopting tangible digital goods like mobile phone minute allowances as transferable currency, but expecting liquid local markets in a highly volatile cryptographic tokens "mined" in foreign countries where mining rigs and cheap power are available seems like a big ask.
The main point, though, was that crypto currency isn't a 1:1 replacement for credit cards.
Also everytime I see yet another Ethereum story I think of http://www.paulgraham.com/submarine.html
BTW: Asus is making mining specific graphic cards to try and relieve the pressure on gaming cards - 10k minimum order.
And both sides are accusing the other side of being authoritarian, for centralization, and basically being even a worst enemy than The State, which is like the worst thing ever. In the meantime, no scaling solution is being implemented, because they are too busy blocking the other side from implementing their solutions.
But I agree, Bitcoin had a standstill for 3 years because of nitpicking over a simple factor two scaling solution. This could end badly for Bitcoin if they don't get their act together.
It's because bitcoin is a pyramid scheme.
Why do you say this? I am certainly not a cryptocurrency expert, but it seems to me that BTC provides real value, in that it is an accepted currency and also in that it distributes the means of control over a far greater area than traditional government-backed currency.
Pyramid scheme reward members for recruiting new members without providing any value. Like all commodities and currencies, BTC increases in value the more people think it is valuable, but if that is how you define a pyramid scheme then gold futures, stocks, and the US dollar are pyramid scheme as well.
The Bitcoin brand itself has intrinsic value which is related to its popularity. Consumers have always been willing to pay a premium to deal with specific brands which they know and trust.
When people buy Coca-Cola, they're not paying for brown sugar-water.
I do think that a lot of Bitcoin's current value is driven by the black market for money laundering but its distributed nature puts the government in a difficult position when it comes to regulation.
If the government tried to delegitimize Bitcoin and shut down all big miners and exchanges, it would just fragment the Bitcoin network further and shift its control into the hands of smaller, shadier players who would be much harder to regulate.
There has always been a market for virtual currencies but because they used to be centralized, the government was always able to step in and shut them down (e.g. Flooz, e-gold...) Cryptocurrencies might actually solve that problem.
Cryptocurrencies require significantly more power to verify a single transaction[1]. The ability to scale to a meaningful size does not exist now. They need to improve efficiency by 3-4 orders of magnitude to be competitive.
Bitcoin is a sound money system, so the proper comparison is all the people, buildings, vehicles, weapons, etc used in the creation and protection of the global fiat currency system.
I don't know for sure, but I bet fiat costs dwarf the $640M or so that Bitcoin costs.
https://bitcointalk.org/index.php?topic=3332.0
The only reason Bitcoin transactions cost so much is artificial scarcity of block space, which increases the proof of work generated per transaction. The absence of a static limit in Ethereum is one of its major advantages over Bitcoin.
Take EOS for example... it's a company that's basically a Bitshares fork and it's raising possibly a half to one billion dollars on the promise to deliver something different in one year.
Their purchase agreement promises nothing and is highly concerning: https://eos.io/purchaseagreement/EOS%20Token%20Purchase%20Ag...
What investor would give a startup half billion dollars in seed money without even an MVP?
In the end it all comes down to: will the team deliver or not? The startups fail at 95% + money corrupt teams.
If the team members done 0% work so far and are rich already, what's their motivation like? Why push through the hard times and drama that will inevitably happen if you can just bail out right now and take the money
“EOS TOKENS HAVE NO RIGHTS, USES OR ATTRIBUTES. The EOS Tokens do not have any rights, uses, purpose, attributes, functionalities or features, express or implied, including, without limitation, any uses, purpose, attributes, functionalities or features on the EOS Platform. The company does not guarantee and is not representing in any way to Buyer that the EOS Tokens have any rights, uses, purpose, attributes, functionalities or features."
It's anecdotal, but cryptocurrencies practically don't exist in my non tech-related social circles.
Bitcoin is slower, more expensive and harder to use than the existing financial instruments. It is censorship resistant though so you can use it to pay people online when the government does not want you to pay these people.
Only cash is "censorship resistant". As a technologist, this is either an embarassing statement, or, a hopeful data point on the durability of 'hits-it-on-the-nail' technology, such as cash, or paper and ink. (Yes, I'm getting bullish on paper pamphlets ..)
Still not perfect, though. Look at how India swiftly and broadly decommissioned some of the bank notes. It is not too crazy to imagine some nations going a step further and decommissioning all bank notes.
Similarly, the blockchain is not perfectly censorship resistant. You need:
1- decentralized transaction validators
2- privacy
For #1, the jury is still out on if mining will remain decentralized. I tend to believe that there are guardians of this property in Bitcoin-land, and if it ever gets too bad, the blockchain can fork to retain this property.
For #2, Bitcoin does poorly here, and hopefully advances in the tech like ring signatures, confidential transactions, MimbleWimble, TumbleBit, zk-SNARKs, etc. will prove to be practical enough for use.
My mom was almost mad because she was sure I had called her to answer this question. It took longer to explain email and show what happened than it did to get an answer.
Everything starts somewhere.
If cryptocurrencies are worth their time they will come to them, the illiterate don't seek books to read.
At least the recommender actually called it a crypto currency and the other, the recommendee, asked what made it useful.
If there was a way for crypto-currencies to handle credit, I think that would greatly increase it's likelihood of replacing real world currencies and central banks--going mainstream. The money we use nowadays is transferable credit and central banks can produce enough to meet the demands of the economy. Crypto-currencies on the other hand are more like gold: there's a limited supply that doesn't meet the needs or demands of the economy.