"Bitcoin has failed as means of payment" is one of the prevalent criticisms of Bitcoin that Fidelity Digital Assets is seeking to rebut.
In a blog post published on Nov. 13, the firm took on six "Persistent" criticisms, including Bitcoin's volatility, environmental wastefulness and use in illicit activities.
Regarding the coin's purported failure as a means of payment for everyday transactions, Fidelity's argument is that this criticism fails to understand Bitcoin's core purpose.
Bitcoin has been designed with other priorities in mind, including "Perfect scarcity," Fidelity argues.
"Bitcoin makes deliberate trade-offs, such as limited and expensive capacity, to offer core properties such as decentralization and immutability. Given its high settlement assurances, Bitcoin optimizes its limited capacity for settling transactions that aren't well served by traditional rails."
As well as price volatility, Bitcoin's tax definition as property in some jurisdictions - meaning that users have to calculate gains and losses for every payment or purchase in Bitcoin - renders it impractical for many payments.
Related to payments, Fidelity tackles the criticism that Bitcoin's extreme volatility compromises its use as a store of value.
"No central bank or government can step in to support or prop up markets and artificially subdue volatility. Bitcoin's volatility is a trade-off for a distortion-free market. True price discovery accompanied by volatility might be preferable to artificial stability if it results in distorted markets that may break down without intervention."
Fidelity provides further, detailed arguments surrounding volatility as well, relating it to the asset's "Perfectly inelastic supply."
The last four criticisms tackled in the blog post are environmental wastefulness, Bitcoin's use for illicit activity, the asset "Not being backed by anything," and its potential overtaking by a competitor.
Bitcoin chose decentralization and immutability over payments, says Fidelity
Publié le Nov 16, 2020
by Cointele | Publié le Coinage
Mentionné dans cet article
Another mainstream company is seeking approval to invest in crypto
Anthony Scaramucci's investment firm, SkyBridge, seeks approval from the SEC to invest in crypto.
COVID-19 popularized decentralization, but blockchain may not catch on
On Nov. 9, drugmaker Pfizer announced that its COVID-19 vaccine is 90-plus percent effective, and even though it may be premature to proclaim the pandemic's end - as the virus continues to rage in the United States and Europe - once can at least speculate: Where will blockchain adoption stand when the crisis abates?
Bitcoin hits new 2020 high at $16.7K -Traders expect bigger breakout
The price of Bitcoin hit a new yearly high at $16,717 on Binance.
The next big crypto market could be fantasy sports, says Messari
As "Digitally native" ecosystems like esports continue to synergize with blockchain technology, industries like fantasy sports could be primed for mass adoption, says digital research firm Messari.