Opinion: Bitcoin is so much more than a get-rich-quick vehicle

Opinions

Date: 22.02.2018

Bitcoin has climbed 950 percent since January 2017. Last week, we watched it break the US$10,000 mark, hitting as high as US$17,000. To put these into context, if you purchase US$100 worth of bitcoin back in 2011, your investment would be worth around US$4 million today.

When you see figures like these, along with all the hype, it’s natural to want to jump onboard the crypto train. You follow the headlines and scold yourself for not looking into bitcoin earlier.

But sometimes you can’t help but wonder what all of this means to you.

You are definitely not alone. There is so much noise and not enough signal. While the mainstream media and social media are focused on the value of bitcoin, important blockchain events—like investments involving leading VCs and entrepreneurs—are buried in the noise.

The one thing that people seem to forget is that bitcoin wasn’t built to be a get-rich-quick vehicle. It was envisioned as an alternative form of facilitating transactions.

The one thing that people seem to forget is that bitcoin wasn’t built to be a get-rich-quick vehicle.

Bitcoin is just a small part of a world where things could be exchanged in a safe, secure, and decentralized manner. This means that the underlying idea behind cryptocurrencies, digital assets, and blockchain is that monitoring and regulation should be done by a network of trusted sources, as opposed to regulatory entities.

And because there are so many moving pieces to complete a transaction (i.e. buying, selling, and trading) without official governing parties, there is room to disrupt every part of the process. It also leaves a lot of unanswered questions.

The movers and shakers in the crypto world are thinking about the implications of hoeing into a single cryptocurrency—bitcoin. However, many don’t realize that it takes a lot of energy to keep it moving.

On blockchain, a bunch of computers solve complex math problems to:

  • Validate the transaction
  • Control the supply

This is what you call “mining.” As of 2017, bitcoin consumes as much energy as it takes to power 159 countries.

Energy is not a sexy topic, but we should think about it, as our planet is running out of natural resources. Leading tech innovators are thinking of ways for the world to wean from our reliance on energy. Google announced that they are 100 percent powered by sun and wind. Tesla stepped in to help a children’s hospital in Puerto Rico get solar energy (the entire country had no power).

While all this is happening, the public is focused on bitcoin—buying, selling, trading, and what have you. The increase in activities requires computers to work double time, and mining cryptocurrency keeps eating up energy. This brings up the question: Is bitcoin sustainable?

Beyond the energy consumption and sustainability questions, there are entrepreneurs in the crypto world who are already working on methods of validation other than mining. But if and when these alternatives become mainstream, what would happen to digital currencies? Would they still be as valuable as we see them today? No one knows yet.

In high-growth nations like the ones in Asia, where the middle class is on track to be the most lucrative in the world by 2030, disruption and innovation are driven by need. The population in the region grows faster than the current infrastructures can keep up.

The promise of blockchain, which is set to grow exponentially, is necessary to move this region forward. But everyone in Asia should understand the technology beyond the idea of getting rich quickly.

https://www.techinasia.com/talk/bitcoin-get-rich-quick

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