Major Takeaways From Financial Economist Peter Schiff’s Bitcoin Discussion
Erik Voorhees, an important cryptocurrency entrepreneur and CEO of the exchange service ShapeShift, met with the bitcoin detractor and bear Peter Schiff in New York City on Monday July the 2nd.
During a debate series hosted in Manhattan by the Soho Forum, the two figures were debating about the famous virtual currency and the cryptocurrency market in general. One of the main topics was whether virtual currencies will replace fiat money or not.
For Voorhees, there must be a gradual adoption if cryptocurrencies want to replace fiat money, and not a shock in the market. But Peter Schiff was skeptical about Bitcoin. He said that people is not buying virtual currencies to use them on daily transactions, but instead, they are buying them to get rich. Additionally, he said that Bitcoin is seen as a speculative asset and people cannot even use them in an easy way.
Furthermore, he said that Bitcoin is not a reliable store of value for individuals or enterprises. Bitcoin price fluctuates every hour, so it makes it difficult for people to know the real value it has, price goods or negotiate contracts in different industries.
But Voorhees answered to all these comments.
Voorhees said about it:
“I remember when it was a big deal when bitcoin moved 50 percent. Today, it’s a big deal when it moves 10 percent. I think a few years it’ll be a big deal when it moves 2-3 percent. While bitcoin is volatile today, I think this problem is self-correcting.”
But there is place for some agreements between both individuals. For example, Schiff said that he does not believe in fiat currencies because he says that the current system is not going to work, but that the solution is not by embracing virtual currencies.
Furthermore, they kept discussing about Bitcoin and whether it is possible for it to become a store of value like gold or precious metals. Schiff explained that gold’s long tenure in the market will make it hard to replace and that there were different competitors over centuries that couldn’t replace it.
And Voorhees believes that the situation will be more difficult for the famous virtual currency because it faces several bans all over the world compared to Gold. In addition to it, he stated that Bitcoin may never be able to succeed in meeting all the four classic functions of money.
But Voorhees was able to defend Bitcoin explaining that it is used for cross-border transactions, it is censorship-resistant and has a limited supply. It is not just speculation.
Soho Forum conducted a poll with the audience asking them whether Bitcoin could beat governments or not. And those voting ‘yes’ moved from 40% to 55% and individuals saying no fell from 40% to 31%.