The End of Bitcoin?

I was reading a rebuttal on Bitcoins Not Bombs against a "check your privilege" position that attempted to discredit Bitcoin. It all started, of course, with the closing of the popular Bitcoin exchange site MtGox. This really goes to show how popular Bitcoin has become especially now that even those in the far left are trying to look for the most ridiculous arguments against the voluntary association and exchange of Bitcoins.

Because of the closing of MtGox, many lost their investments and savings. Once again, this popularized an "end of Bitcoin" sentiment among those who have very little understanding with the subject.



There's an interesting insight from a post in the Bitcoin PH Facebook group I'm part of that showcased an interesting trend in these "end of Bitcoin" scares:

bitcoin crash of 2011 = end of bitcoin
bitcoinica hack = end of bitcoin
silkroad raid = end of bitcoin
china "ban" = end of bitcoin
mtgox insolvency = end of bitcoin 
 bitcoin adoption is way past the tipping point. when things like these happen, bitcoin's value will definitely take a hit, but it wont be the end of it as a whole. being a dev familiar with bitcoin protocol internals, the only possibility i see of bitcoin "ending" is this: if that there is a huge exploit or flaw in its core implementation, or if that transactions committed and confirmed in the blockchain cant be trusted anymore.

It's true. I remember during after the Silkroad raid (which coincidentally happened around the time of the Breaking Bad finale), many who didn't even understand the tech aspect of it (specifically, the Block Chain) assumed that Bitcoin will lose value. In fact, not only were the effects very minimal, this only popularized Bitcoin even more. At the time, Bitcoin was at around 100 dollars or so, if I remember correctly.

The same is true for the China ban, MtGox insolvency, and so on. Yes, Bitcoin takes a hit, but for those who understand how it works and who really believe in it -- much like in precious metals, a dip in price only means buying opportunity.

Just don't be stupid and put all your whole life savings in Bitcoin in the same manner that it is not advisable to put your entire savings in precious metals. And yes, it's proven that precious metals can withstand history and has intrinsic value but the only way I see Bitcoin "ending" is if somehow humanity forever ceases to have access to the internet or electricity which is very improbable or, much like in the quote above, if somehow there is a flaw in its implementation.

Actually, just a few days ago, my smartphone was stolen from me. It sucks because nowadays this one gadget serves many purposes. It was my camera, music player, internet browser, etc. But you see, it also could also have easily been my wallet and/or bank account had I invested and kept Bitcoin in it. I'm not entirely familiar in making backups or any of the other tech aspect of it all but I'm sure I'll learn through experience eventually because Bitcoin is something that's very promising to me.

If you read The Original Bitcoin White Paper by Satoshi Nakamoto, it's almost like a libertarian dream come true, really. For me, the purists who argue that Bitcoin doesn't have intrinsic value unlike precious metals have good point but the more I learn about Bitcoin, I realize that there's something so valuable in the system. It is a promise that, even by the off-chance that it fails, will be a precedent to future innovations in our concepts of money and trade (and other industries as well!).

There's always something new to learn about Bitcoin and having a local community, coming from different political and technical backgrounds, really helps. Just search Bitcoin PH on Facebook if you're interested to learn more.

5 comments:

  1. As I'm reading your posts about Bitcoin, my curiosity is growing all the more. Is transaction with Bitcoin legal? It is unbelievable how it one Bitcoin is priced nowadays.

    Thanks for this insightful post.

    ReplyDelete
  2. Hi, Rovie. Yes, transaction with bitcoin is legal as long as you do not use it in any illegal activities. As far as I know, Philippine government does not intervene in any bitcoin transaction but the BSP (Bangko Sentral ng Pilipinas) cited that there are risks associated with bitcoin, and they will be monitoring the cryptocurrency from illegal use or money laundering. Anyway, to get a deeper knowledge about this, visit www.bitcoindaily.com.

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