“We may not recognize the long-term sustainability of bitcoin as a currency, but we understand and embrace the potential of the Bitcoin protocol to unlock the doors to a more accessible, transparent and accountable financial system.”
I’ve attended Money2020 since its first edition in 2012. That year, the terms Crypto-Currency, Block Chain, Bitcoin or even Digital Assets were nowhere to be found on the agenda. The 2013 edition featured Bitcoin prominently for the first time in what I call the “Bitcoin Vegas Coming Out Party.” Several panels were dedicated to ‘math-based’ currencies and payments, and the general attitude among the attendees was respectful and cautiously optimistic. Several large exchanges and wallet services showcased their brands in massive booths on the main expo floor manned by their CEOs. Fueled by the promise of disruption, the atmosphere among bitcoiners reached a level of exhilaration.
This year, however, things in the crypto-camp looked different — toned down, and dare I say, duller. Assuming my personal impression actually reflects reality, it’s worth wondering why that was the case. No doubt the Bitlicense has had a dampening effect on the industry’s spirits, but I happen to believe there’s a deeper, more fundamental reason.
Like a slick facade over a vacant building, the fact that the conference organizers showcased Bitcoin and crypto-technologies in a separate two-and-a-half-day specialized track called Bit(coin)World (which included a keynote during the general session by the Winklevoss twins), may have exacerbated the year-over-year contrast.
Granted, environmental circumstances did change a lot in the past twelve months: At the time of the 2013 conference, the price of bitcoin, while remaining stable through the Silk Road crackdown, was between a third and a half lower and was weeks away from crossing the four-digit mark. Mt. Gox had not yet imploded, and even after Charlie Shrem’s indictment, federal and state regulators continued to give the industry forbearance as they learned about the intricacies of the new crypto-technologies.
Clearly, the Bitlicense proposal has put a major damper on the industry’s mood, but it seems to me that the real reason for the contrast between this and last year is the growing realization that the obstacles to bitcoin’s massive adoption as a currency are real and even potentially insurmountable in the foreseeable future.
Multiple speakers in several panels within Bit(coin) World 2014 openly acknowledged that “things — acceptance and adoption of bitcoin and other crypto-technologies — are going to take longer than expected.” It certainly seems as though 2014 is making crypto-industry members reassess their assumptions and estimates.
To that point, I’m not talking about technical challenges inherent in bitcoin’s design features, such as the relatively low confirmation speeds or the scalability limitations. Nor am I talking about the risk of a 51% attack, which is seemingly bound to increase as the miner incentives get reduced over time and need to be replaced by fees, or the risk that those future fees and inevitable compliance costs could erase some of the benefits of processing payments over the Bitcoin network. Those are real issues in and of themselves that will need to be addressed as the technology evolves.
However, what if the obstacles have more to do with human nature than with technology? What if they have more to do with the nature of power? What if the concept of money is so inextricably linked to culture, law and institutions, that it could take generations to change? What if the average person prefers to trust a brand rather than a trustless technology? What if consumer protection is a function of product design and corporate culture rather than an externally imposed appendage? What if trust arises from familiarity, community and transparency rather than from decentralization?
And more importantly, what if it were possible to innovate in the digital age while embracing current regulation and influencing its change via demonstrably better alternatives? What if it were possible to create a new financial system that completely disrupts the status quo and achieves global financial inclusion without creating additional complexity?
These are the kinds of questions that inform product development and corporate culture at Bitreserve.
Here at Bitreserve, we are stimulated by and steadfast in our contrarian approach to innovation. Our digital ledger in the cloud simply removes the complexities present in block chain-based platforms while bringing the benefits of speed, low cost and reliability to real-world assets of any flag and kind. We may not recognize the long-term sustainability of bitcoin as a currency, but we understand and embrace the potential of the Bitcoin protocol to unlock the doors to a more accessible, transparent and accountable financial system. Similar to how the Internet came to be, layers upon layers of innovation will meet the needs of individuals and businesses everywhere. Some will succeed, others will fail, but the tide will have raised all boats.
We at Bitreserve want to see dramatic positive changes in our lifetime. The time has come to rethink and reimagine how the worlds of money, payments and finance services should work, and it’s our hope that Bitreserve will be a hub for this much needed innovation.
I encourage those who do not understand what Bitreserve is, does or stands for, to suspend their judgment and disbelief and try to answer the questions above, and to do so, as the popular Argentine saying goes, “with your right hand on your heart.”