Has Bitcoin become a shitcoin?
I can hear the troll’s footsteps already, but the question is valid. Bitcoin promised low fees and fast transaction speeds by utilizing the blockchain. That’s why we have been ditching fiat in favor of crypto. At this stage of the game low fees and fast transaction speeds are the basic minimum features that any coin needs to have in order to succeed. Since bitcoin’s inception many ‘improved’ coins have come online, which either address scaling issues, and/or add additional features. Bitcoin’s community has failed to address the scaling issue, which has made it painful to use bitcoin. It sometimes takes days for a transaction to post and the fees have become unreasonable for small transactions. I know many people are nostalgic for bitcoin but these fundamental issues will dethrone bitcoin. It has already lost half its market share. The technology already exists to solve these issues in other coins. The market is slowly figuring out which alternatives are the best solution and the transfer of wealth from bitcoins to altcoins has begun, and is accelerating.
When this crypto bubble pops people will panic and pull the remainder of their money out as predicted in any bubble. If you thought the bitcoin network was clogged up now, the resulting congestion will be even worse. When people are waiting days for their bitcoins transactions to clear and see the price dropping they will feel a sense of agony and create lots of FUD through social media. As the altcoin market unwinds, people will start funneling their money through ethereum* instead of bitcoin to get back to fiat. This will allow bitcoin’s value to drop further and ethereum to delay its price fall. People’s confidence in and loyalty to bitcoin will evaporate. Bitcoin’s market cap will then be the same magnitude in size as other alt-coins like litecoin and dash. At that point it is an uphill battle to capture market share. The winner will be the one with the best technology and unless bitcoin’s community turns it around, bitcoin will be left in the dust like countless other shitcoins.
*I state that people will funnel their crypto money through ethereum because the infrastructure is in place in many exchanges to trade ether for alt-coins. From there people can convert ether for fiat through coinbase. Litecoin might also see some of this action as it can be converted to fiat through coinbase but the exchanges don’t have as many litecoin for alt-coin trades. Shapeshift allows alt-coin for alt-coin trades but the money will be flowing in one direction at that point so the transactions will be slow.
Do you think that the Crypto world is in a bubble or that this could just be industry growth?
I can't wait to see ETH take the number 1 position. It is just a matter of time...
The crypto world definitely has industry growth but look at the market cap over time. Real industry growth doesn't normally go exponential. The new Dapps, DAOs and Coins are not creating real value yet, but they get tons of money if they go through a ICO. That is a big bubble warning sign to me. Long term these prices will look cheap... for the survivors, but +90% will fail. Just like any other tech start up.
https://coinmarketcap.com/charts/
Sure, that's a good point. What goes up must come down. Although, I am going to enjoy the ride while it lasts and then take advantage of lower prices :)
You might be right. What a carnage. It's bound to happen at some point. But how close are we to that point? There are a lot of people with very strong interests in that scenario not happening, and I think the BTC community is showing some willingness to act on the problems soon instead of fighting over which way to go. It will be interesting to see what happens, that's for sure, but I'll keep on hodl'ing for a while still.
It's impossible to predict when the bubble will pop. Perhaps later today or in a couple months. Depends on when the next Mt Gox happens, or when a resent ICO flops. The hackers out there are very incentivised right now. There have never been so many insecure wallets with +1 million dollars worth in them. Hold your own private keys! I thought the BTC community was coming together after consensus but that even seems to have fallen apart. I think BTC could fork into two coins and that would cause it to loose credibility. The developers should be working on making BTC great, not fighting to keep it alive.
You're absolutely right!
I think the "bubble" still have a lot of space to grow. If a lot of blockchain projects can make their whitepaper real and get real usage, the bubble can transform in a nice, big, growing market! But indeed, for now I keep on hodling, LTC is one of my favourite coins! And still cheap :-)
The issue is that it will take years to develop the blockchain projects into real value creating systems. The speculators don’t have that kind of patients. Eventually they will pull out, which will start the panic selling. The long term holder will be rewarded because eventually some of those blockchain projects will gain traction and have real world impacts. Then the next bubble inflates… The trick is to figure out which blockchains will burn out and which will make it long term. (I say the next bubble because the average person hasn’t bought into crypto yet. After they do we can move past these market wide bubbles. I think this is the 6th crypto bubble we are on right now)
I can't agree more with your reply. I am testing some of them already (like cloud storage blockchains) but my experiences are that none of them are ready for the big masses! (They are still away from the ease of use like One drive or Google drive, ...). The same counts for pure "currency"-crypto's, we need an easy way to send, store, ... which is secure and easy to use for the big masses...
Exactly, the masses! The currency cryptos have come along way since I first entered this space in 2013. The first time I bought BTC I had to buy linden dollars (from second life) and trade them for BTC. Coinbase makes that so much easier. Also, the hardware wallets that are now available make it easy to spend your crypto coins but are as safe as cold storage. I’m tired of needing to make new paper wallets every time I sent coins from an account, but it was the only way to keep your coins truly safe back then. Still things need to become easier. One of my friends wants to invest a little in cryptos but he is afraid of sending the coins into the abyss if he screws up an address. I don’t blame him but it’s issues like that that this space needs to solve to build confidence with the masses.