Earlier this year, various mainstream media outlets such as Vox dismissed Bitcoin’s potential to revolutionize the world’s financial and banking systems, despite the fact that Bitcoin has already surpassed the market cap of most reserve currencies.
On Nov. 21, Vox Media published an article entitled “Bitcoin was supposed to change the world. What happened?.” Throughout the report, author Timothy Lee stated that Bitcoin is far from becoming a mainstream technology.
“Venture capitalists have poured more than a billion dollars into Bitcoin startups, yet we seem to be no closer to making Bitcoin a mainstream technology. To a large extent, Bitcoin today is still used for the same applications — illicit transactions and financial speculation — that it was in 2014 and 2012,” said Lee.
Supporting Lee’s stance on Bitcoin, New York Times reporter Nathaniel Popper stated:
“I think Bitcoin has stalled out.”
Bitcoin vs. banking Blockchain
However, Lee’s stance on Bitcoin is completely hypocritical as, throughout the article, Lee puts an emphasis on the growth of enterprise-grade bank Blockchain, a technology which is yet to demonstrate a single working commercial application in the financial industry. Lee also criticized Bitcoin’s use in processing illicit transactions, which is an illogical argument as cash is the preferred store of value for most of the world’s criminals and illicit traders.
Most experts agree that Bitcoin is a technology still in its infancy. In terms of scaling and adoption, it still has a long way to go. However, even at its current early stage of development, its market cap is holding $12.18 bln with stability, surpassing the value of many reserve currencies.
via @jamieCrypto: How many national currencies are smaller than bitcoin? pic.twitter.com/0oph8H1cWO
— Kristov Atlas (@kristovatlas) December 2, 2016
Currently, the market cap of Bitcoin is significantly larger than many of the national currencies in African, Middle Eastern and South American countries.
More importantly, the value of Bitcoin has demonstrated a lower volatility rate compared to some major reserve currencies, such as the British pound.
Everyday payments
Some state that Bitcoin is impractical as a day-to-day payment method due to its inefficiency and high transaction fees.
Bitcoin experts somewhat agree with this argument, as former product lead at Blockchain stated in late 2015:
Bitcoin isn't about buying a latte with your mobile phone, it is about making the transactions that they say you can't make.
— Keonne Rodriguez (@keonne) December 9, 2015
However, as Bitcoin scales and develops certain technologies like Lightning, it is possible to facilitate micropayments quickly, with low fees. Even with the average $0.15 fee per transaction, Bitcoin is a cheaper and more efficient settlement network than credit card networks like Visa, which charges between 3-4 percent per transaction.