The co-founder of Gemini Exchange, Tyler Winklevosssaid the ongoing pandemic is helping to promote acceptance of Bitcoin.
In a recent tweet, Winklevoss described how the pandemic had uprooted life as we know it, particularly its impact on the monetary system. He believes this is the basis for more people interested in the Bitcoin narrative.
The pandemic has catapulted us into the future. Accelerating offline retail failure, streaming, social media… uncovering structural issues with Fiat, increasing debt and the likelihood of hyperinflation – which means it is accelerating #Bitcoin Adoption.
– Tyler Winklevoss (@tylerwinklevoss) July 29, 2020
But not everyone agrees reply pointed out that Bitcoin does not solve any of the problems listed. In addition, the volatility and the fact that users have to convert back to Fiat only affect the point.
"I'm all for Bitcoin, but it doesn't really solve any of these issues, especially as far as network transaction costs are concerned. And with BTC's rapid price changes, you don't want to use or accept anything when you have to switch back to Fiat."
Should hyperinflation ever occur, the subsequent switch to alternative transaction methods would highlight the shortcomings of BTC as a medium of exchange.
While Winklevoss takes on the role of the Bitcoin maximalist, an economic collapse would actually mean the introduction of Altcoin.
Bitcoin does not use it as a medium of exchange
Although the Bitcoin White paper was entitled "A Peer-to-Peer E-Cash System". Due to its poor scaling, high fees and slow confirmation times, it is anything but a means of processing transactions.
A 2017 study by Baur, Lee and Hong found that the main use case, despite high volatility, is focused on a speculative investment.
"We find Around a third of Bitcoins are held by investors, especially users who only receive Bitcoin and never send it to others. A minority of users, both in number and bitcBitcoin appears to serve as a medium of exchange in balances. This indicates that at Current bitcoins are held for investment purposes and are not used for transactions and so as a medium of exchange. "
They further argue that BTC's small market cap compared to other markets poses no threat to financial or monetary stability. However, if this ever changes, the influence of the government and tax authorities would shrink as a result.
Blockchain developers, Krill Shilov The hypothesis that the creator, Satoshi Nakamoto, did not intend that BTC would grow to the extent that it was. For this reason, Shilov believes that Nakamoto has focused on security and scalability.
"Satoshi Nakamoto probably didn't think his creation would become so popular, so he sacrificed scalability to make it as secure and decentralized as possible. Scalability was a distant problem at the time."
Shilov pointed out that there are many alternative cryptos that better perform the role of the exchange medium.
All bets are made when it comes to speculating which currency coin would rise to the top in a hyperinflation situation.
Even then, who should say that there would only be one.