Daniel Halliday
Jul 24 · Last update 1 mo. ago.
Is bitcoin a speculative bubble?
Can cryptocurrencies work to the extent that they could be viable as a currency? Or are they all just a speculative bubble?
Stats of Viewpoints
It may well be, but it still has uses and blockchain technology will be revolutionary
0 agrees
0 disagrees
Cryptocurrencies are a concept that cannot be compared to how we use currencies today
0 agrees
0 disagrees
Bitcoin and blockchain’s decentralised database technology will lead to an environmental disaster
0 agrees
0 disagrees
Bitcoin has no intrinsic value, doesn’t work as a currency and will inevitably crash as an asset
0 agrees
0 disagrees
Viewpoints
Add New Viewpoint
It may well be, but it still has uses and blockchain technology will be revolutionary

Blockchain will have applications despite bitcoin’s success. Even if blockchain currencies do not overtake fiat currency, blockchain’s model of secure decentralised storage of data will revolutionise secure database technology. It is set to revolutionise how contracts, banks, and artistic royalties function and is likely to diversify in time.

The internet has marked a period of change for the arts and especially for the music industry. An average of 86% of an artists proceeds from their music are thought to be lost in unpaid online royalties alone. Distributed ledge technology could prove to be revolutionary in addressing this problem, as it could not only allow instant royalty establishment through smart contracts, but could also underpin a system of cryptographic watermarks, were royalties are perfectly allotted to the appropriate artist’s streamed content.

Agree
Disagree
Latest conversation
Daniel Halliday
Nov 7
Approved
DH edited this paragraph
The internet has marked a period of change for the arts and especially for the music industry. An average of 86% of an artists proceeds from their music are thought to be lost in unpaid online royalties alone. Distributed ledge technology could prove to be revolutionary in addressing this problem, as it could not only allow instant royalty establishment through smart contracts, but could also underpin a system of cryptographic watermarks, were royalties are perfectly allotted to the appropriate artist’s streamed content.
Cryptocurrencies are a concept that cannot be compared to how we use currencies today

There is an inherent flaw in arguing that bitcoin is a speculative bubble, and not having intrinsic value, without accepting that fiat money, as in national currencies, are also subject to this same criticism. If it wasn’t speculative and was backed by a physical asset, it would be impossible to keep it decentralised, which is the most exciting prospect with bitcoin or other cryptocurrencies. Such currencies are a new concept that defy definition by previous limitations imposed on currency, there use may change as the technology and society does, but they are more than just a speculative asset.

Cryptocurrencies are new technology, they may require development as their usage increases, as with all technology, bitcoin requires adopting and incorporating to function fully. As countries such as Sweden and China try to move towards being cashless societies and world tourism becomes ever popular, cryptocurrencies will offer more flexible monetary solutions and inevitably become more popular also. As countries currencies move away from paper and move online it is likely that transactions to cryptocurrencies will become more common, either due to investment or trying to utilise the decentralised nature of the currencies to avoid international banking charges.

Agree
Disagree
Latest conversation
Daniel Halliday
Nov 7
Approved
DH edited this paragraph
Cryptocurrencies are new technology, they may require development as their usage increases, as with all technology, bitcoin requires adopting and incorporating to function fully. As countries such as Sweden and China try to move towards being cashless societies and world tourism becomes ever popular, cryptocurrencies will offer more flexible monetary solutions and inevitably become more popular also. As countries currencies move away from paper and move online it is likely that transactions to cryptocurrencies will become more common, either due to investment or trying to utilise the decentralised nature of the currencies to avoid international banking charges.
Bitcoin and blockchain’s decentralised database technology will lead to an environmental disaster

With the already monumental energy consumption this technology requires, and the accelerating rate of growth of blockchain technology, many have warned of what a big environmental disaster blockchain technology could represent. As so much computing power is needed across many servers to verify a decentralised blockchain database, the power consumption of Bitcoin mining alone is thought to currently be greater than that of some countries entirely. This would mean that Bitcoin alone is already indirectly responsible for several million tonnes of carbon emissions, and with the popularity and implementation of this technology growing, this problem will only get worse.

Blockchain's power consumption is difficult to measure, as the industry is spread across the world and is fairly secretive, dealing with encrypted information. Alex de Vries, an analyst and blockchain specialist, tried to establish a detailed estimate, averaging blockchain's consumption to an annual amount of 32TWh as of December 2017, which is the estimated consumption for the whole of Denmark (2014). However these estimates are based on assumptions that all parties working with cryptocurrencies are using energy efficient technology, and due to the fact that many miners may use less advanced solutions the actual consumption is likely much higher. The ultimate price of bitcoin and cryptocurrencies will be worse than an economic crash, they will be a major contributor to climate change, accelerating a problem we currently have no solution for.

Agree
Disagree
Latest conversation
Daniel Halliday
Nov 7
Approved
DH edited this paragraph
With the already monumental energy consumption this technology requires, and the accelerating rate of growth of blockchain technology, many have warned of what a big environmental disaster blockchain technology could represent. As so much computing power is needed across many servers to verify a decentralised blockchain database, the power consumption of Bitcoin mining alone is thought to currently be greater than that of some countries entirely. This would mean that Bitcoin alone is already indirectly responsible for several million tonnes of carbon emissions, and with the popularity and implementation of this technology growing, this problem will only get worse.
Bitcoin has no intrinsic value, doesn’t work as a currency and will inevitably crash as an asset

To be used as money successfully cryptocurrencies including bitcoin need to function as a medium by which value can be exchanged. For monetary systems to operate it is imperative that money holds some steady degree of value over time, so that loans and payments over time can be arranged. Bitcoin is too volatile to function in this way, with no intrinsic value, and therefore is functioning as a speculative asset, not as a viable currency.

Speculative bubbles refer to a financial crisis in which speculation of an asset’s value far exceeds its intrinsic value. This situation can be first noted in 17th and 18th centuries, initially with the sale of certain fashionable tulip bulbs in Holland, prices going beyond the average yearly salary before crashing spectacularly. Similarly the British South Sea company, who were granted a monopoly over trade in South America despite Britain’s involvement in a War with the Spanish at the time, who were in control of South America. Regardless of this contradiction, stocks in the company were traded at increasing prices, despite no British trade occurring in South America. This is arguably a similar pattern to bitcoin trading...

Agree
Disagree
Latest conversation
Daniel Halliday
Aug 26
Approved
DH edited this paragraph
To be used as money successfully cryptocurrencies including bitcoin need to function as a medium by which value can be exchanged. For monetary systems to operate it is imperative that money holds some steady degree of value over time, so that loans and payments over time can be arranged. Bitcoin is too volatile to function in this way, with no intrinsic value, and therefore is functioning as a speculative asset, not as a viable currency.
Translate