The Bitcoin Book: A Beginner's Guide to the Future of Finance by Underhill Matthew

Author:Underhill, Matthew [Underhill, Matthew]
Language: eng
Format: epub, pdf
Published: 2020-09-25T00:00:00+00:00

Some negative opinions

WHILE WE ARE on a bit of a downer from the last chapter, let us continue with the negative vibe for a few more paragraphs. I would not feel comfortable if I didn’t briefly mention some of the negative views that some people have of Bitcoin. I would feel rotten if a reader of this book brought some bitcoin or any other cryptocurrency, solely on the merits I have presented and then for whatever reason the crypto market flopped, and they lost their fiat currency. Like any new technology, there are positives and negatives and Bitcoin is no different. That’s why there has been such an explosion of other coins in its wake, as people have tried to develop a coin that doesn’t have a particular feature of Bitcoin, or improves on an existing one or replaces it with a different one altogether. It is fair to say that I am a big fan of Bitcoin, however, I am not 100% blinkered and do appreciate some of the larger community’s concerns, even though I may not fully agree with all of them. I will list just a few of the main concerns that I am aware of and am sure if you do your investigating you will find more.

There are a few people in the space who believe that the 21 million coin limit should be increased. It will upset lots of people if the limit that Satoshi set in place is not respected, as it will reduce the scarcity of the coins and in turn most likely reduce the price (albeit hopefully for the short term). One of the people who is promoting this idea is Peter Todd one of the lead developers of Bitcoin. It is speculated that this could be achieved by slackening the rules around the block reward halving every 4 years. However, it is extremely unlikely to ever happen and in my opinion, would most likely result in a new cryptocurrency forking off Bitcoin rather than Bitcoin changing such a fundamental aspect of its protocol. Too many people have entered the Bitcoin ecosystem on the understanding that only 21 million coins will ever exist. I am confident, as others are, that this figure will be respected. On a side note, because there are so many Satoshi’s in a single coin (100 million) it means there are going to be a total of 4 Quadrillion (4 million, trillions) Satoshi’s in total, once the last bitcoin is mined. This figure of total units is many times greater than all the world’s currencies combined. So simply put, 4 Quadrillion units should happily serve humanity for the foreseeable future.

Bitcoin can only muster a small number of transactions per second. This issue was one of the reasons Bitcoin Cash forked from Bitcoin, as bigger blocks allow for more transactions. Today Bitcoin can handle roughly 7 transactions per second (TPS). Note: This figure may be higher at your time of reading. Many other cryptocurrencies are in a similar position, with a relatively low TPS.

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