By Edward W. Mandel
At BQT, our curated list of asset pairs is and will perpetually remain a work in progress. Now that we have entered cryptocurrency’s second decade, it’s critical that we look forward to the assets with the greatest growth potential. While not counting anything out, there are an even dozen which have attracted our attention. In this new series, we examine them, listed here in no particular order: Matic, Tron, Cardano, Monero, Iota, Dash, Tezos, Chainlink, Luna, Neo, Seele and, per this first installment, Bitcoin SV.
Market cap
As of this writing, the market cap for BSV, is $2.0 billion, according to CoinMarketCap. That’s around 1% of all digital assets’ combined, and accounts for roughly the same proportion of daily trade volume.
So it’s not exactly setting the world on fire. It’s ninth-highest valued cryptocurrency, edged out by Binance’s on-exchange token. It’s the third-highest valued bitcoin. So why are we paying so much attention to it?
To start with, let’s look at all the assets it still outranks. Monero? Stellar? Tron? Cardano? Tezos? Not only is BSV bigger than any of them in terms of market cap, it’s bigger than any two of them put together. And, while Tron has a unique story to tell in terms of liquidity, BSV’s daily volume far exceeds any of the rest.
Count out BSV at your own peril.
History
The history of BSV is the same as that of BTC — which we discussed here — until July 2017. From there, it’s similar to that of its twin, BCH, which we also covered previously.
To summarize the BCH story, fees on the bitcoin network were rising sharply. Many believed this would lead to bitcoin becoming less of a currency and more of an investment asset. The solution, they felt, would be a blocksize-increasing hard fork. Also — and this was more of a religious argument than a practical one — there was a negative reaction to Bitcoin’s adoption of the Segregated Witness storage protocol. SegWit would have a centralizing effect on a digital asset which would be, ideally, fully decentralized.
BCH became, to some degree, the passion project of an ecommerce entrepreneur and early bitcoin adopter named Roger Ver and his colleague on the mining side Jihan Wu.
“The problem with revolutionaries, though, is that they’re more united in what they’re fighting against than what they’re fighting for,” I wrote last year. “There was another faction, led by Australian data scientist Craig Wright, who is on the short list of people who might actually be the individual behind the Satoshi Nakamoto pseudonym. (Wright has the distinction of being the only likely candidate who wants people to think that he is.) They called their version of what cryptocurrency ought to be Bitcoin Cash Satoshi’s Vision. BSV forked off BCH after a few months [in November 2017] and is still a major player.”
There’s also Bitcoin Gold, Bitcoin Diamond and Bitcoin Plus.
This this not their story.
Use cases
“Four fundamental pillars form the basis of Bitcoin SV’s roadmap to create the one blockchain for the world: stability, scalability, security, and safe instant transactions (a.k.a 0-confirmation),” according to the BSV website.
If Wright is indeed the father of bitcoin — and the jury is still out on that — then I’m heartened that he essentially confirmed my suspicion that it was never intended to be the speculative investment it became when released into the wild.
“You know what a utility token is? It’s a bus ticket, a cinema ticket,” he told a Bitcoin Association’s “BSV: Bitcoin for Business” gathering in Tokyo last year, in which he described bitcoin as “just plumbing”.
And maybe that’s all bitcoin ever needed to be. That said, Wright considers BSV to be the best auditing technology in the world” and he should know. In a previous life, he was an auditor with the prestigious BDO firm.
Still, just because BSV wasn’t designed to be more multifaceted doesn’t mean it isn’t. After all, audit is a function that any trustless endeavor requires.
According to Tony Tong of the Hong Kong Blockchain Association, BSV serves as a gateway to provably fair gambling. He told Coingeek that online gaming operators battle issues of trust with players, particularly those who are losing, and that this use case would help the online gaming industry settle complaints.
“With the help of microtransactions on BSV,” according to Coingeek’s summary of their interview with Tong, “gaming operators will be able to automatically maintain permanent, immutable public records of game results and payouts, instantly settling these disputes whenever they arise.”
It’s worth noting that online gambling is what made Wright’s business associate Calvin Ayre, an Antigua-based billionaire, via his Bodog brand. Ayre, who is an active participant in the BSV project, also owns Coingeek, which would explain why it covers BSV more fully than other outlets focused on the crypto space. Coingeek, incidentally, is primarily a mining operation and only secondarily a news site.
The article went on to state that “Tong is already exploring the BSV blockchain for tokenization of physical assets, which he says hold particular appeal for Asian investors.”
According to Ayre, though, the main focus for BSV development in 2020 is in applications for large enterprises.
“The Teranode Project will also roll out later in 2020; it is an enterprise-class version of the Bitcoin SV Node software, re-building the Bitcoin code from the ground up using a micro-services architecture approach to create better functionality for big business users,” he wrote in — what else? — Coingeek. “Developed by nChain, the global leading research, development and advisory firm for blockchain technology, Teranode will insure Bitcoin SV will scale to massive use as global adoption increases.”
Current state
Then there are those — including Ethereum founder Vitalik Buterin and Binance CEO Changpeng Zhao — who believe BSV has no use case at all and is, in fact, a sham. Binance delisted BSV in April 2019 in a bizarre cascade events.
The first event, in December 2015, was that two separate mainstream tech news outlets both reported that Wright was the true Satoshi. After some hemming and hawing, Wright asserted in 2016 that he was indeed the pseudonymous founder of Bitcoin. That was followed by a retraction, then a retraction of the retraction. In response, @hodlonaut, an anonymous Twitter account, became the standard bearer for skeptics in the space when they launched the #CraigWrightIsAFraud tag and started calling Wright “pathetic” and “mentally ill”. Wright then offered a $5,000 bounty for whoever could reveal the identify of @hodlonaut. Nobody took the bait — #WeAreAllHodlonaut is a thing — but the Binance boss took exception to Wright trying to silence a critic by doxing them, and added his own voice in agreement with the skeptics.
“Craig Wright is not Satoshi,” CZ tweeted. “Anymore of this sh!t, we delist!”
And that’s exactly what happened, to Vitalik’s apparent delight. According to a CCN article by Greg Thomson, he tweeted that BSV was a “dumpster fire” and told a YouTube streamer that it was a “complete scam.’
While I personally reserve judgment, it is odd that BSV miners seem to be ploughing along despite economic disincentives. If miners keep mining even though they’re losing money, as Binance reports, then you have to wonder if they’re getting paid some other way and for some ulterior reason. Then again, Binance has its own reasons for being harsh on BSV, so believe what you will.
Keeping perspective
And yet BSV has the kind of operational issues that struggling startups have and scams do not. In late 2018, a researcher found that both BSV and BCH were susceptible to double-spend hacks, according to CoinTelegraph’s William Suberg. And the results of the Genesis hard fork, intended to completely decentralize the project, have yet to be felt.
It’s not that we at BQT have no horse in this race. We want to put bets down on as many horses as possible. This will be a make-or-break year for BSV. Let’s see what happens.
Edward is an Ernst and Young Entrepreneur of the Year Finalist, Blockchain Enthusiast and visionary behind many successful organizations. An avid entrepreneur, Edward has a knack for designing distinctive business models complemented with superior technology to deliver unparalleled service and profitability. Edward also has been advising and consulting for various successful Blockchain technology and recently launched BQTX.COM exchange, BQTUniversity.io Blockchain Education Platform, BQTexchange.com beta-P2P exchange helping traders connect with each other to leverage their crypto assets.
The information can be found online at BQT.io, on Telegram @BQTCommunity.
