Investment expert Clem Chambers: “Which coins will dominate is down to a Darwinian process”
What is your attitude towards the concept of private money? What can collapse of regulator's monopoly on money supply lead to? What are the hidden threats and what opportunities it can reveal to the world?
Private money is nothing new. For example, there were private tokens in the mid 1600s and early 1800s in the UK. Then there have been: Traveller's cheques, Luncheon Vouchers, Green Shield Stamps, Air Miles and Nectar points.
Cryptocurrencies are no different except they are a better way of doing the same thing and everyone can be the issuer and there is no 'dead hand' of centralized control.
It’s very difficult to foresee all outcomes, but the basics give a good clue to how things will develop. If blockchain technology is more thermodynamically efficient than old-style money, it will replace it. If not, it won’t. Government will have cryptocurrencies and they too will flourish. If they do a better job of it than the crowd their currencies will dominate. If they can’t then the private sector will dominate. Economics always wins out, so it is the economics of blockchain that will determine the future, and I believe the economic impact on productivity is giant.
Some countries use bitcoins to ensure economic security (Zimbabwe, Iran). In your opinion, will it help them to stabilize the economic situation in the long term? Could cryptocurrency become an effective solution for undeveloped countries?
Money is a proxy for most things. It’s a tool. The tool wielder is the determinant factor in the outcome. As poor governance is basically 'rent seeking’ behaviour perpetrated by middlemen, cryptocurriency efficiencies, which can be used to delay 'rent seeking,' have great potential for the creation of good governance.
What factors affect the cost of bitcoin and altcoins? In your opinion, how long the growth of bitcoin price will continue? What will happen to BTC exchange rate when all the coins are mined?
Political structure is the key to value. This is expressed in trust, community, narrative and thermodynamics. Good cryptocurrencies are self-stabilizing, so ultimately cryptocurrencies with grow to the level of demand for them; this is probably an order or two greater than current levels. Which coins will dominate is down to a Darwinian process of market forces. The efficiency of this process will bring huge opportunities.
Tell us a little about your book
Blockchain and cryptocurrency is a giant learning curve and people don't know where to start. My book is a crash course in how to get going without paying for your education via expensive errors. Make no mistake, cryptocurrencies are a minefield, and one increasing regulation will add a lot of value to. However, navigating these early days is important to steal a march on the mainstream. The book aims to get readers up to speed on the subject in the quickest possible time.
“An invaluable guide to making money in cryptocurrencies: how they work, how to invest in them, trading cryptocoins, mining, and the technical details behind them.”
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