It would seem that the peak of the Bitcoin hype has passed, its price has stabilized at the depressive mark of $ 6,000; the blockchain technology, although it has not exhausted its potential, has certainly not changed the world, as was expected a year or two ago. Nevertheless, disputes around Bitcoin do not subside and experts continue to wage holy wars in discussions about the potential of cryptocurrencies.
One of the most important questions is whether Bitcoin can be used as a means of payment and can serve as a substitute for fiat money.
There is an opinion that Bitcoin should be considered solely as an investment tool, not a payment means. The reason is the high cost and low transaction speed. Simply put, it is inconvenient to use a cryptocurrency for everyday purchases.
It is noteworthy that the majority of experts who share this point of view are, as a rule, citizens of countries with a high standard of living and stable economies. From their perspective, the use of Bitcoin in everyday life is impractical, because the monetary system existing in their country copes with this nicely. From their point of view, Bitcoin and other cryptocurrencies are exclusively investment assets, and very risky ones at that. Many of them still keep believing that the cost of Bitcoin is not backed by anything, which means that this “bubble” can burst at any moment.
The question of the insecurity of Bitcoin is debatable.
For example, Kyle Torpey in his article in Forbes writes that Bitcoin’s alleged lack of security is not a reason to consider the cryptocurrency a bubble. In the end, gold also has no real value, because it has not been used in industry for a long time, not to mention the dollar, whose stability is based on a social contract. From this point of view, buying Bitcoin is comparable to investing in gold. Grigory Bakunov, director of technology distribution at Yandex, and many other experts commenting on this issue in 2017 and 2018, have the same opinion.
The optimistic predictions of crypto-enthusiasts are contradicted by the researches of economists.
For example, Jeremy Granthem, co-founder of the investment firm GMO, considers Bitcoin and the entire stock market in general a bubble that will burst in the next two years.
“The lack of a clear fundamental value, unregulated markets and the illusion of greatness make Bitcoin the biggest bubble of all that can be found in history books,” the analyst writes in a report comparing Bitcoin`s 2017 growth with tulip fever.
A similar opinion is shared by the Columbia University professor Jeffrey Sachs. In his article in the Boston Globe newspaper, he states that the 14-fold growth of Bitcoin was based on nothing except for people’s belief in the possibilities of cryptocurrencies and the thirst for quick profits.
Such analytics periodically pops up in the information field and, as a rule, it precedes the next wave of price fluctuation.
I return to the assertion that most analysts, who view Bitcoin as an investment asset do not believe in the possibility of using it in everyday life and predict its speedy collapse, live in wealthy countries.
The situation is completely different from the position of the inhabitants of poor countries in Africa, Southeast Asia and Latin America. Practice shows that they are much more interested in cryptocurrencies and often use Bitcoin in everyday life.
The African continent is considered one of the most promising areas for the growth of the cryptocurrency market. There are several prerequisites for this: weak national currencies, lack of a developed banking system, corruption and high inflation. Moreover, according to the World Bank data for 2014, only 34% of the adult population in sub-Saharan Africa were bank account holders, while 12% were holders of money in mobile accounts at the time when the global average was 2%. Most Africans still use conventional bank transfers, despite the fact that local banks charge a huge commission. However, over time, there are more and more of those who transfer money in Bitcoin and then exchange it for a local currency. Yes, transfers in cryptocurrencies also require a gas fee, but its size is comparable with that of banks.
Practice shows that in poor countries the prospects for the adaptation of cryptocurrencies and the use of Bitcoin on a day-to-day basis are much brighter than in European countries. For residents of poor African countries, purchases and transactions in Bitcoin are a necessity and a way to solve immediate problems.
No matter what the economists in developed countries say that Bitcoin cannot be a means of payment and that it is just a bubble that’s about to burst, the interest in cryptocurrencies in disadvantaged countries (whose population makes up an absolute majority on planet Earth) speaks about the opposite. If cryptocurrencies are able to solve the problems of people in underdeveloped countries, then they have a future.
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