Jeff Fawkes is a seasoned investment professional and a crypto analyst. He has a dual degree in Business Administration and Creative Writing and is passionate when it comes to how technology impacts our society.
From the beginning of its inception, Bitcoin was worth cents but had indestructible inner value. In the darkest days of humanity, only rare things will have value. Bitcoin and other cryptocurrencies can become the vaccine from the financial crisis.
Due to the coronavirus attack and democracy constant fail across the globe, banks now can dump your data to anyone. The corporations and governments are taking away more rights under the cover of safety measures. However, total exposure to social interaction maps will only make people hide more and trust the government less. In a search for coronavirus vaccine, the government is more than happy to quickly forget your financial rights too.
It doesn’t matter whether they want to track anybody not paying the taxes, or it’s about tracking coronavirus victims. Hundreds of people are escaping home quarantine when there’s an important reason for the surveillance measures. They will definitely escape the surveillance without such reason, and the coronavirus is not here forever.
The banking industry is easy to disrupt thanks to centralization. The development of Bitcoin was decentralized from the beginning. Back in 2009, there was no GitHub repository, and the developers were keeping Bitcoin Core wallet as the RAR archive in the public chat. And of course, on their own PC’s. Later, the client code was attached to GitHub, but still, it got a lot of followers and coders who peer-reviewed. The repository was in development by dozens of people from across the planet. The uniqueness of such a project was in the fact that the people working on it didn’t even know each other.
Qualities of Bitcoin Allow It to Be a Crypto Vaccine from Financial Crisis
Bitcoin has a limited monetary supply, which is 21 million coins. It’s not like the U.S. dollar and the majority of fiat currencies. Bitcoin gains even more scarcity over time, which is a sign of so-called ‘deflationary currency’. The network is generating fewer new coins after years pass. And the fiat monetary system is generating more and more of the paper money. Such behavior leads to a crisis.
During the crisis, only the rare things matter. Like gold, honey, silver, wood, food, toilet paper and… cryptocurrencies.
Bitcoin development looks strange compared to the classic development scheme. Usually, the team is sitting in the same office. And the GitHub is a measure of convenience and transparency, not the last hope for efficient communication. But Bitcoin was never about classic solutions.
Many of the 20th century’s classic banking practices are not in the use anymore. For instance, the bank secrecy of the account operations is not here anymore. The majority of the countries have signed different agreements to put a stop on bank secrecy. In the past, nobody could ask the bank about the transaction details, quality and quantity of accounts you have, and so on. Now, banks are dumping the information just like that.
The transparency and privacy of the payment method, as well as coin scarcity, always made people aware of Bitcoin. From one side, blockchain shows off all of the transactions. From the other one, it doesn’t show the names of the senders and the receivers.
Depending on what you need most – transparency or privacy – you can use the blockchain in both directions. A powerful network of miners and nodes not knowing each other will make sure that your transaction is safe. Despite Bitcoin’s transactions became slow and expensive over time, people are ready to use it because it is still better than using a bank wire.
In the Crisis, Best Things Emerge among People
Bitcoin emerged after the crisis of 2008. Some people understood that the banking system will not withstand one more debt hole. This time, it’s the coronavirus crisis, not the debt one. But the governments worldwide are printing fiat papers more and more.
Tyler Winklevoss, one of the pioneers of the crypto industry and Gemini exchange co-founder, claims that the crypto number 1 is the financial vaccine, which could save you from the outcomes of the printing press age.
Bitcoin is the only vaccine in the world that can give you immunity to the money printing disease.
— Tyler Winklevoss (@tyler) March 26, 2020
Not only the American dollar, but Chinese yuan, Japanese yen, Russian ruble, the Euro, and a hefty of other currencies receive a ‘quantitative easing’ boost. How will the world come out of the coronavirus crisis if money cannot generate the cure?
Sure, people will receive help, in a form of government payouts (like in the U.S). Or maybe they’ll just have the right to avoid paying all the percentage on their credit cards. But the products will cost more over time, making the quantitative easing inefficient. And still, there’s no cure.
The most substantial value is not in the paper. It is not even in the toilet paper. It is in hardcore protection, and survival, in the days of coronavirus attack. So, people who have food, alcohol, shelter, and supplies will win. As per the large corporations, especially the ones working on the car industry, in tourism, and in beauty space… unfortunately, they lose. Nobody to blame, expect the world to turn upside down again and again.
What Could Drain Bitcoin’s Power on a Path towards Adoption?
Bitcoin has a lack of scaling solutions, there is no new, privacy-related code too. And the issue of development centralization is emergent as never.
A lack of scaling solutions means that, even if people will rush to buy Bitcoin, there is no enough space in the block to perform all the transactions. Even when 40% of the network’s transactions are going through SegWit/Lightning, the network’s TPS is very low compared to any other crypto.
The lack of privacy-related code means that the developers are not taking any measures against surveillance software. More and more people are getting to jail thanks to Chainalysis and Crystal. You should be extremely careful when dealing with crypto these days. Exchanges are tracking coins, and if you had some ‘dirty’ one, they freeze payments and even report to police (sometimes). Only when Bitcoin improves privacy, many of its initial fans will come back. As well as the crowds of new adherents.
The issue with code development is that even the OG’s of the industry have absolutely no idea who are the people who contribute code today. The industry is rolling on a special kind of truth generated by the developers, and the public persons, of this space. They are trying to assure the public that Bitcoin has no flaws with scaling. But many of the technical specialists claimed that Bitcoin’s development standards are far from being ordered. For instance, it is hard to join the Bitcoin Core inner circle of the development if you are not familiar with one of them. The good old days when anybody could participate are over.
These are not conspiracy theories, even Andreas Antonopoulos claims that Bitcoin in 2019 is having a lack of competitive privacy model. What will happen in 2020 when Monero, Beam, Grin, Dash and Zcash are all around?
The illustrations were provided by Depositphotos.com