Bitcoin is our Shitcoin of the Week
Shitcoin of the week is a NuMoney series for which we try to offer contrarian viewpoints to an otherwise overtly hyped industry.
For the laymen, the term Bitcoin and cryptocurrencies are interchangeable. It is the first currency to come into people’s minds when the topic of cryptocurrencies arises. When Bitcoin mooned back in late 2017 to dizzying heights of almost US$20000, many became intrigued and rightly questioned: "Is Bitcoin worth $20000?".
Slow Transaction speed and high fees
Bitcoin is slow (each transaction can take up to 10mins), with fees that can be unpredictably high (US$10 fee is not uncommon).
The reason for expensive fees is because only one 1mb of data is allowed per block, which is mined every 10mins. This leads users competing against each other with higher transaction fees to get their transaction committed into the upcoming block.
Lightning Network is economically broken
The lightning network for Bitcoin is promised to be the saviour to these Bitcoin woes. But there are many claims for it to be economically broken, as there are no incentives for users or miners to partake in it. This is explained in the article below, but do take note that it might be biased as it is from the people behind Bitcoin cash.
Bitcoin transactions are anything but anonymous
There are many proponents of Bitcoin stating that Bitcoin is anonymous. But is it truly anonymous? In the blockchain, every transaction is committed without obfuscation. If I receiving any amount of Bitcoin from you, I will know precisely how much Bitcoins you have, and every transaction you have done historically. Given sufficient forensic research, I will be able to track every transaction that you have made.
Bitcoin’s creator is anonymous
We all know that the creator of Bitcoin goes behind the pseudonym of Satoshi Nakamoto, who but who exactly is he? Or she? Or them?
Largest pre-mined coin
Before releasing Bitcoin to the public, Satoshi Nakamoto allocated himself a massive chunk of Bitcoins. Till date, he is responsible for one of the largest pre-mined coin that is sized in billions.
Bitcoin is supposed to be decentralised, but now it is mostly dominated by two companies, Blockstream and Bitmain. Blockstream employs a significant chunk of developers who belong to the core development team of Bitcoin, while Bitmain produces dedicated ASIC miners which constitutes a substantial portion of Bitcoin miners.
Being the first ever cryptocurrency, Bitcoin has brought cryptocurrencies and the concept of a blockchain mainstream. Even better, it has paved the way for many other coins, most of which improve upon Bitcoin’s flaws.
There is no doubt that Bitcoin will be here to stay. But in what sense? Only time will tell.
Lastly, one friendly tip from the NuMoney team -- avoid buying anything you do not understand. Do your research and only put in money you are willing to lose!