Bloomberg Releases Opinion Piece About Bitcoin’s Usage as Crypto Community Criticizes It
- A Bloomberg article received several critics from the cryptocurrency community
- Samson Mow answered point by point why he believes the author of the article is wrong
Bloomberg has recently released an article about Bitcoin (BTC) in which it claims that virtual currencies are not used by anyone around the world more than just for speculation. This is why there were several crypto community members that decided to answer back to it. One of them is Samson Mow, the CSO of Blockstream.
Bloomberg Releases Article Saying Bitcoin Is Used Just For Speculation
Bitcoin and virtual currencies have been expanding all around the world during the last years. There are many different use cases that apply to them according to users’ needs. For example, in Venezuela, individuals are using it to perform transactions with family abroad or just to buy daily things.
Nonetheless, there are individuals and analysts that believe that Bitcoin is driven just by speculation. In a recent article, Olga Kharif wrote that Bitcoin is not used by anybody. For example, one of the phrases she wrote reads as follows:
“Hardly anyone is using the world’s largest cryptocurrency for anything beyond speculation.”
This is clearly a wrong assumption about Bitcoin, and it is possible to make a deeper analysis of what “speculation” means and does not mean. Samson Mow explained that storing value is real usage and compared it with purchasing gold or property.
So many things are wrong in this article about #Bitcoin. "Hardly anyone is using the world’s largest #cryptocurrency for anything beyond speculation." Storing value IS usage, just like purchasing gold or property. If you're going to define usage to be payments, say it explicitly. https://t.co/zkW3tni09B
— Samson Mow (@Excellion) May 31, 2019
He went on saying that if the author considers “usage” as payments processed by the network, she should have mentioned it in the article.
Mow gave an example of a store of value. He said that Real estate in Vancouver is basically Bitcoin for wealthy Chinese. There was a moment in which prices were so high that people couldn’t purchase more apartments, which ended in an empty home tax that aimed at increasing the offer of apartments for renting.
In this case, people purchased real estate property in order to be able to store value. Additionally, Mow said that that there is 1,800 new Bitcoin each day released to the market. That means that if Bitcoin remains at $8,000, there are $14.4 million dollars being stored per day.
The author of the article said that Bitcoin needs hype to attract mass appeal in order to be considered a viable electronic alternative to money. However, Mow says that Bitcoin is an already viable alternative to money. There are several individuals and companies already using digital assets in order to process cross-border transactions or day-to-day purchases. The CSO of Blockstream said that if there is hype, people would purchase the digital asset without even knowing what is it and how it works.
Mow said that Bitcoin is not a payment network such as VISA. The author said that VISA processed almost half a billion transactions every single day in 2018. Nevertheless, Mow explained that it is important to measure exchange trading volume, on-chain transactions, OTC trades and also merchant transactions using Bitcoin. This will give a more accurate idea of how Bitcoin is being used in a real way.
"Visa processed almost half a billion transactions every day last year, and handled $11.2 trillion in payment and cash volume in 2018." #Bitcoin is not a payments rail. If you want to measure usage, add up: exchange trading vol, on-chain P2P txs, OTC trades, AND merchant txs.
— Samson Mow (@Excellion) May 31, 2019
It is worth mentioning that there are some countries that use the most popular digital asset as a speculative investment. These tend to be the most developed countries. However, countries such as Venezuela or Zimbabwe register transactions that are related to daily usage rather than speculation. Countries with unstable economic situations and a weak currency are those with the largest number of transactions not related to speculation.