BITCOIN | INTERNET
Searching for the Next Bitcoin Is As Useless as Searching for the Next Internet
Don’t waste your precious time.
Bitcoin is still at an early stage. After a little over eleven years of existence, Bitcoin has still only realized a tiny part of its immense potential. Few people really understand this. I think the fact that Bitcoin’s market cap is already over $175 billion makes some people think that it is now too late buying Bitcoin for the first time.
If Bitcoin’s market cap is already huge for a disruptive technology that was built solely by its users, the potential for future growth is still enormous.
By way of comparison, gold represents an $8 trillion market. Many call Bitcoin digital gold. If Bitcoin were to reach a market cap equivalent to that of gold in the future, its price would exceed $350K.
So you need to understand that Bitcoin’s growth potential remains intact.
This potential is reinforced by the fact that Bitcoin is much scarcer than gold since the quantity of Bitcoins is limited to 21 million units.
Of course, you will probably never again see a +9,000,000% increase in Bitcoin price in just 10 years, as was the case in the past decade.
Based on this single observation, I still see a lot of people moving away from Bitcoin to look for what they call the next Bitcoin. In this story, I will try to make you realize that this is a totally futile process.
Worse yet, people who take this path are wasting their precious time, and risk missing out on the Bitcoin revolution.
Some are searching for the next Bitcoin from a financial investment perspective
A first category of people are looking for the next Bitcoin from a financial investment point of view. These people have never bothered to understand why Bitcoin was created. They don’t understand why Bitcoin is a revolution.
These people are simply blinded by their greed to make more and more money at all costs.
In Bitcoin, they only see a financial investment that transformed $1 invested in 2010 into $90,000 by the end of 2019:
With a price just below $10K today, these trader-like investors feel that it will now be impossible for them to generate such profits with Bitcoin.
Since they have no interest in Bitcoin other than the financial side, they decide to look elsewhere.
They are going to go through the list of all the existing cryptocurrencies. The reference website CoinMarketCap references over 5,500 cryptocurrencies as of June 10, 2020. Since they are aiming above all for huge profits, they will look beyond the top 50 of the most capitalized cryptocurrencies.
Their goal is to find a cryptocurrency whose current price would be very low in order to buy a lot of tokens.
Then they hope that this cryptocurrency will magically reveal itself to be the new Bitcoin.
You can see the heresy of such behavior. It’s like wishful thinking.
Just because you are going to buy 100,000 tokens at $0.01 of a cryptocurrency, trying to convince yourself that this cryptocurrency solves all the current flaws of Bitcoin, does not mean that you are going to get rich.
You will simply make the mistake of letting your emotions override your sense of logical reasoning. Greed is an emotion to avoid if you want to make a profit from your investments. This truth applies to all types of investments.
The next time you see questions blooming on forums asking what are the most promising crypto currencies at less than $1 you will better understand what I am talking about here.
Some are searching for the next Bitcoin from a technological point of view
The second category of people looking for the next Bitcoin is a subset of the first category I just told you about. These people want to make big profits, but they try to be more realistic. Instead of blindly believing in every cryptocurrency project whose token is worth less than $1, they will do intensive research.
Their starting point will be to target the shortcomings of Bitcoin. To do so, they will do research on their own.
The flaws they find will be more or less true. All of this will depend on the good faith of the person, as always. The list will of course include proven shortcomings of Bitcoin. Indeed, it would be a lie to say that everything is perfect in the world of Bitcoin today.
It is at the next step that these people will make a major mistake.
Rather than looking at what the Bitcoin community is doing to address the current shortcomings of Bitcoin, these people will give in to the sirens of marketing.
I’m talking about cryptocurrencies having marketing teams touting their projects by saying that their technologies are better than Bitcoin.
The marketing teams of these cryptocurrencies projects will not hesitate to belittle Bitcoin by saying that its technology is outdated, and that it has never evolved.
Some projects will even go so far as to say that their technology is infinitely scalable. It could handle millions of transactions per second where Bitcoin is currently limited to around 7 transactions per second on its network.
With such marketing arguments, many end up giving in by buying tokens from these cryptocurrencies projects.
They will then become strong advocates of these cryptocurrencies by trying to denigrate Bitcoin in order to convince themselves that they are not making a mistake by missing out on Bitcoin.
As far as Bitcoin is concerned, you will have noticed that it has no marketing team trying to sell you anything.
Bitcoin is defended only by its users who only want to show you the facts without embellishing reality. At least that’s what I always try to do in what I write.
Searching for the next Bitcoin is like searching for the next Internet
Although Bitcoin still has many opponents, more and more people are convinced that Bitcoin is the greatest technological disruption since the emergence of the Internet.
So I find it interesting to compare the evolution of Internet since its creation with that of Bitcoin.
When the Internet was created, the technology had major flaws. In fact, the Internet still has shortcomings. However, nobody talked about looking for the next Internet. All of the most talented developers have been searching for solutions to address the issues that was blocking Internet’s evolution.
With all the work of thousands of developers around the world, Internet has never stopped improving since its inception.
With Bitcoin, you have to understand that this is exactly the same situation.
Bitcoin has shortcomings, but all the talented developers that gravitate around the Bitcoin ecosystem will find solutions to fix them.
Bitcoin is not a cryptocurrency like one of the 5,500 you can find on CoinMarketCap.
Bitcoin is much more than that. Bitcoin is the money protocol of the Internet. It is a layer of the Internet in its own right:
The more time passes, the more impossible it becomes to replace Bitcoin with another technology. All the work that has been done for more than ten years cannot be replaced in a few months by a cryptocurrency project that promises you a lot.
I’m talking about promises here, because that’s what it’s all about.
All these projects that present technologies supposedly superior to the Bitcoin protocol are just promises that will never meet the scalability problems that Bitcoin faces.
If you take a closer look, you will see that these solutions are at the expense of network decentralization. On the other hand, Bitcoin still remains the most secure decentralized network in the world.
The decentralization of Bitcoin is one of its greatest strengths, and no other cryptocurrency can claim to do better.
Bitcoin faces unique problems due to the growing number of its users. Bitcoin’s utility is maximum, and it is something that all those cryptocurrencies can never have.
After having wasted a lot of time searching for the next Bitcoin, many people come back to Bitcoin. They finally understand that Bitcoin is the future. Searching for the next Bitcoin is therefore a total waste of time.
Bitcoin is the future, and its ecosystem is constantly improving
Bitcoin protocol already represents the future. Other cryptocurrencies projects on which many are wasting their time will sooner or later go towards zero. Technological promises are nothing more than promises if users don’t find utility in a technology. Time will help you understand this.
If Bitcoin has many problems today, they will be dealt with in the years to come by its formidable community of developers.
Some argue that the Bitcoin protocol is not evolving fast enough. They simply don’t understand that the stability of its protocol is part of Bitcoin’s value proposition. This stability is embraced by users who believe strongly in Bitcoin for the future.
In addition, developments are indeed being made to the protocol. But they do take time. This is of paramount importance, because the slightest bug introduced in the protocol by too much haste could cost billions of dollars.
To give you an example, important work has been done for many months to improve the privacy of Bitcoin network’s users. This includes, but is not limited to :
- Taproot which will make each Bitcoin transaction similar to the others by removing information about unrealized conditions.
- CoinJoin which is an information mixing technology that helps to better disguise users participating in a transaction.
Others go on to say that the number of contributors to the Bitcoin protocol source code is very small.
In fact, thousands of highly talented developers are working on solutions built on top of the Bitcoin protocol, which is intended to remain as stable as possible over time.
Many think Ethereum is indispensable because Bitcoin does not support smart contracts. This is a misconception once again.
Bitcoin still has a mechanism to add conditions to coins transfers over the network. This is the Script system.
This system is too complex, but initiatives exist to provide Bitcoin with a language to write Bitcoin scripts in a more structured way. Miniscript is one such initiative.
In the future, it is clearly to be expected that platforms offering Bitcoin smart contracts will be added on top of the Bitcoin network. What is done with Ethereum regarding smart contracts can be done with Bitcoin in the future.
Each use case not covered by Bitcoin at a given time can be added if the need becomes essential for its users. Innovation around Bitcoin is permanent.
The 6 Priorities for Bitcoin Development in the Coming Years
The community needs to focus on these priorities.
As far as the scalability of Bitcoin is concerned, the problem is of course well known to the Bitcoin community.
A lot of work has already been done for several years with the Lightning Network to address the scalability problem of the Bitcoin network.
The Lightning Network protocol proposes the creation of micro payment channels. These micro payment channels will help to relieve congestion on the main Bitcoin network, and prevent it from becoming saturated.
The solution will therefore be located at the level of a second layer built on top of the Bitcoin.
Work on the Lightning Network is progressing slowly, but this protocol will be essential to make Bitcoin usable by millions of people in the future in a non-custodial way.
Lightning Network should allow Bitcoin to have almost infinite scalability.
As is often the case with Bitcoin, solutions are emerging from the many startups building services around Bitcoin. This ultra rich ecosystem is also what allows Bitcoin to remain the king in the cryptocurrency industry after all these years.
This is also the reason why Bitcoin will remain the king in the future, and why there is no need to waste time searching for the next Bitcoin.
Bitcoin is a real technological revolution, but also a monetary one, which is still at an early stage. Searching intensely for the next Bitcoin as some people do is a waste of time.
It’s like searching for the next Internet, which nobody does.
On the contrary, thousands of people have been working to improve the Internet by addressing its flaws since its creation. With Bitcoin, it is exactly the same thing. Bitcoin is a unique invention in the history of mankind.
Bitcoin is the money protocol for the Internet that will last. If its shortcomings are real, they will be improved over time by talented developers as it was done for the Internet. The sooner you understand this, the sooner you will be able to participate in the Bitcoin revolution.
This will help you avoid wasting time, and money, on cryptocurrencies projects that are usually nothing more than empty promises.