University of Sydney lecturer: Bitcoin is “dumb money”

On 10 April 2018, Michael Beggs has posted a wide description of Bitcoin history and his thoughts on this on Jacobin. The article went largely unnoticed by the digital currency community, but there are some points worth retelling.

In short, the member of the Sydney University thinks that Bitcoin was overvalued by the libertarian enthusiasts and they had even less arguments than those who believe the humanity should switch back to the gold standard.

Implying that Bitcoin has existed long enough to be compared with fiat currencies, Michael Beggs tells that no fiat currency has ever demonstrated such volatility and unreliability. This is indeed one of the main problems Bitcoin and most other cryptocurrencies have to solve in order to become more attractive for major investors. As the expert thinks, the limited supply of coins does not make Bitcoin valuable, although other observers stated otherwise in the past.

There is, however, an indication of limited vision of this expert: when talking about transaction fees and their high cost, Michael Beggs ignores the possibility of future Bitcoin protocol updates. According to news websites, Lightning Network has already helped to partly solve the issue.

This opinion would be interesting for all who search actual downsides of Bitcoin and tired of blockchain evangelists who highlight only the benefits of this technology.

Image courtesy of museumofplay.org