The inevitability of bitcoin, the possibility of blockchain

Photo by Pierre Borthiry on Unsplash

“Theoretically Satoshi Nakamoto is already the richest man in the world.”— — Wang Xing

Wang Xing is the founder of Meituan and also a bitcoin investor. This is Wang Xing’s latest statement on Bitcoin after its price hit the $50,000 mark. Recently, not only Wang Xing but many others have been speaking out on bitcoin one after another. They include Tesla’s Musk, Bridgewater Fund’s Dalio, and Microsoft’s Bill Gates.

Surprisingly, they are all in agreement on bitcoin — they are bullish on bitcoin, and even Gates, who once claimed he would short bitcoin, has become neutral. Why are so many big names in the business world speaking out on bitcoin one after another? Could it be that they got wind of something in advance? Apparently, not so. If we analyze these people’s statements carefully, we’ll see that they all have one intersection, namely, they all view bitcoin from an investment perspective and nothing else.

The continued vocalization of bitcoin by business leaders has somewhat influenced the market’s perception of it, so we are seeing more and more people going from cautious to enthusiastic about bitcoin, and some are even wondering when it will become a world currency.

However, what is overlooked is that most of the big names in the business world are speaking about bitcoin from an investment perspective and nothing more, and to associate the possibility of Bitcoin becoming a world currency simply with its rising price can only be overthought.

However, Satoshi Nakamoto did look at Bitcoin as a world currency when he created it. Nevertheless, the scarcity of bitcoin seems to dictate that it does not have what it takes to become a world currency because when we benchmark against the US dollar, we could see that while the US dollar as a world currency can be printed at full power, bitcoin is a scarce commodity, and the more you mine, the less you have left, and it is not inexhaustible.

So, it’s a bit of a stretch to assume that Bitcoin will become a world currency if we associate it with a price increase. I still maintain my original judgment about bitcoin, which is that it is a collector’s item and investment, and will never become a widely recognized settlement currency in the world. For every dollar the price of bitcoin rises, it is less likely to become a world currency and, eventually, will become a complete investment and collector’s item.

As the price of bitcoin continues to rise, what I think about most is not bitcoin instead, but the blockchain technology behind bitcoin. I am more worried that people will once again tie it deeply to the blockchain because of the rising price. Earlier, I had pointed out in an article that the more bitcoin’s price rises, the purer the blockchain becomes, and now with bitcoin’s price standing at the $50,000 mark, I still maintain that view.

As Bitcoin’s price rise reignites enthusiasm, and especially investment enthusiasm, I’m more willing to believe that the more Bitcoin’s price rises, the more distant it becomes from the blockchain. That is, we can no longer look at it from a blockchain perspective, but should look at it with a whole new mindset. That new way of thinking is that bitcoin is bitcoin and blockchain is blockchain, and that the two are a completely different kind of being from each other.

However, we can’t deny that there will still be people using bitcoin to support their blockchain projects, and there will even be people using the rising price of bitcoin to continue playing the money game. While it is true that this approach can fool some people who don’t understand the relationship between bitcoin and blockchain, when the price of bitcoin rises again and it becomes a complete investment, all the rhetoric tied deeply to bitcoin will turn into a bubble.

Thus, the inevitability of bitcoin lies in investment and collection.

Photo by Jp Valery on Unsplash

As the price of Bitcoin hits the $50,000 mark, it may be more practical to think about the new future regarding blockchain than to just eye envy.

Exploring the blockchain possibilities reflected in the inevitability of Bitcoin is the key.

First, blockchain has the potential to reinvent tradition. While it’s true that people already think that blockchain is a brand new technology, and this technology can indeed bring changes to our lives. However, we still haven’t found any kind of success cases to support it, and all the goodness is hypothetical. The emergence of Bitcoin has eased such an embarrassment, and it has further increased the possibility of blockchain reinventing tradition.

From the perspective of investment and application scenarios, we can see that blockchain has the potential to reshape tradition. Imagine how our lives would change if we could apply blockchain technology to another scenario like bitcoin and get the same effect as bitcoin. Likewise, how would our lives change if we could apply blockchain to more scenarios and really bring people’s lives into an era where blockchain technology is the infrastructure?

So, as the bitcoin price hits the $50,000 mark, we should see more of the reshaping and disruption of our traditions by the blockchain. Even if we look at bitcoin simply as an investment target, we can also see this reinvention of tradition by blockchain. It extends people’s perception of assets from a purely defined sense to a broader digital realm. Since Bitcoin can be a new investment and really stand the test of time, blockchain will also have more opportunities to reshape the tradition and really bring our lives into the digital era.

Secondly, blockchain has the possibility to form consensus. We all know that one of the core points of blockchain technology is the consensus mechanism. The high price of bitcoin is an outward manifestation of this consensus mechanism. Because people have formed a consensus on the high price of bitcoin and are constantly trying to achieve this consensus, then the price of bitcoin can go all the way up.

For a world that lacks consensus and trust, blockchain is a technology that is needed too much. It is worth noting that the consensus of Bitcoin is only in the field of currency and finance. Imagine if we apply blockchain technology to more fields and scenarios, and reach some kind of consensus, many problems in our current production and life may be solved.

Unlike the consensus in the traditional era, which is built on a centralized platform, the consensus in the blockchain era is built on a peer-to-peer basis, and this consensus mechanism achieves a consensus of people’s participation, a satisfactory result for everyone, and an optimal solution. For people who are always looking for solutions and have never been able to find the perfect solution, blockchain undoubtedly has the possibility of allowing people to reach some kind of consensus.

Consensus is very important, once some kind of consensus is reached, we won’t have the many dissatisfactions we have now, and we all work together in one direction. The rise in the price of bitcoin is actually a testament to this. Because of the consensus that has been built and put into practice by business leaders, investment institutions, and investors in general, the birth of Bitcoin and the price of Bitcoin breaking the $50,000 mark has been the result of this consensus.

The consensus that blockchain has built on Bitcoin is just one example. What we should see through it is the potential for blockchain to reach consensus and change the goals and tasks that were not possible in the Internet era. By applying blockchain to more scenarios than bitcoin and reaching some kind of consensus, we may achieve more “miracles on earth” like bitcoin and solve more problems that could not be solved.

As the price of bitcoin breaks the $50,000 mark, we are seeing that the path of bitcoin as an investment is becoming clearer and will become a necessity. What we should also see is that the relationship between bitcoin and blockchain is becoming clearer and clearer.

With this as a breakthrough, we should seek the possibility of blockchain refracted under bitcoin and apply this possibility to more scenarios and fields, which may be the key to ensure more new developments for bitcoin and blockchain in the future.

Article from Bihu

Translated by Yang(Mengyan Finance)

To translate some latest policy and issues on blockchain and fintech happened in China