BitMinute CEO Tom Meredith Declares BitCoin Useless — Down the Road
Tom Meredith is the Co-Founder and CEO of BitMinutes, has been studying BitCoin since its inception, and has issues with it.
“In short, the problem with Bitcoin is that it is not tied to an asset and there is no practical use for it”.
This quote comes from an interview this week with Kerry Lutz on the Financial Survival Network.
A few key quotes from their BitCoin discussion:
“BitCoin is just a file format running over a distributed database. There’s no there there. It is not a panacea, it is just happened to be the first methodology of creating a peer-to-peer system…that actually worked,” said Meredith.
“What is the use case? The use case eventually drives valuation.”
The main issue with BitCoin, stated Meredith, is if and when the price falls below the cost to mint a BitCoin, which he estimates is now hovering in the $6,000 range. Miners then exit the market, removing the very people who verify transactions, the authenticity of the token. What then, he postulated? Does that destroy the trust in BitCoin that is underpinning its attractiveness?
If the U.S. Treasury and Fed declared that they are no longer backing the Federal Reserve note with the full faith and credit of the U.S. government, how long would it take for hyperinflation to ignite?
The full faith and credit backing BitCoin is solely derived from the willingness of people to accept it as payment. That could erode as quickly as the price rose last year.
Why listen to Tom? You don’t have to, but Tom has built up some credibility here (street cred, or trust, to stick with this article’s underlying theme.) He is a serial entrepreneur who has been crafting solutions in online security, peer-to-peer (P2P) lending and other ventures for over a decade, which has kept him tied closely to the BitCoin phenomenon, and the concepts driving its value. P2P Cash has created the Smart Token Chain, a useful combination of block chain advances, cryptocurrency innovation and cyber security mandates.
The BitMinute itself, as the interview discusses, is a cryptocurrency tied to a real-world asset called a prepaid airtime minute. Officially, the prepaid minute is just prepaid airtime on a mobile phone. However, it is fast becoming an informal currency in thousands of less developed communities where formal banking services are scarce and people need a reliable non-cash vehicle of exchange. Prepaid minutes, though, are trapped in the network of the mobile operator that issues them. BitMinutes unlock the gate and make the prepaid minute universally exchangeable. This opens up an enticing opportunity to apply fintech advances to build a new financial services delivery system that could be the key to allieviating cycles of poverty in thousands of communities in the developing world.
More information about BitMinutes can be found at BitMinutes.com.