Seth has been studying and researching blockchain technology for 3 years
Boom or Bust?
When you think about blockchain what's the first thing that pops into your head? It is more than likely Bitcoin. Bitcoin was created in 2008. Concieved out of the internet and developed and created by none other than person or persons, Satoshi Nakomoto. Only 21 million Bitcoin can ever be mined. It is important to note that the protocol can be changed. The community would have to decide, and developers would have to rewrite the code. Also, Changing the supply cap would require a hard fork. This means that all nodes and miners on the network would have to adopt the changes, or be forced off the network. As I write this now, Bitcoin has a market cap that sits at a little over one trillion dollars and a current price of $56,529.00. Those are impressive numbers, let's take a deeper look.
Bitcoin was the first, it set out with a bold mission: Money 2.0. When I first heard about it, I immediately thought it was a ponzi scheme. To some, it still is. To others it's a currency. To me, it's currently a store of value or a hedge. However, it will eventually be a huge bubble, and I will tell you why.
-Not Energy Efficient or Sustainable
-High Transaction Fees
-Slow Transaction Times
-Centralization of the Network/Nodes
-Vulnerable to 51% attacks on the network
Nearly all of this stems from proof of work. Proof of work does not work. Anyone telling you otherwise is biased or simply misinformed. Nearly all consensus algorithms have pros and cons. Proof of work has many cons. I always encourage people to do their own research. Never listen to me or anyone else for that matter. I strongly suggest everyone do their due diligence.
Why I can be wrong:
In order for bitcoin to succeed in the long run, it would have to switch consensus algorithms. This is similiar to what Ethereum is in the process of doing. Ethereum is moving from proof of work to proof of stake. Eth also has a lot issues with it as well, but that will be for another article.
In short, Bitcoin has plethora of hurdles ahead to overcome if it wants to remain number one in terms of market cap. I believe regulation will have to step in at some point to address the energy sustainability of BTC. I predict Bitcoin will be dethroned in under 2 years in relation to market cap.
To keep it short, there are better projects out there. This can be a hard reality for some people to come to terms with. My strategy is very simple in nature. Invest in projects and crypto that have real use case/utility that have multiple use cases. Invest in the projects that have interoperability, speed, scalability, sustainability, and security. BTC lacks all of these. Always remember that the first is never the best. Never put in more than you are willing to lose.
This content reflects the personal opinions of the author. It is accurate and true to the best of the author’s knowledge and should not be substituted for impartial fact or advice in legal, political, or personal matters.
© 2021 Seth Michael
Umesh Chandra Bhatt from Kharghar, Navi Mumbai, India on May 11, 2021: