Bitcoin economist Saifedean Ammous has called the cryptocurrency market a zero-sum game in a recent tweet, stating that,
“If you’re not on Bitcoin, you’ve already lost.”
Ammous went on to label other cryptocurrencies “copies of Bitcoin”, and accused their developers of attempting to create money or value out of thin air.
Cryptocurrencies are a zero sum game, and if you're not Bitcoin you've already lost.
Copying bitcoin is not innovation, it's just a new way of running an old scam: money printing. Actual innovations will be built on Bitcoin NOT by people copying it to print their own money. https://t.co/6TD0aLGF0Y
— Saifedean.com (@saifedean) July 19, 2019
Cryptocurrencies: A Zero-Sum Game?
Ammous’s tweet was in response to another by Muneeb Ali, founder of Blockstack, where he said that cryptocurrency is not a zero-sum game and that people can support other innovations in cryptocurrency along with being invested in Bitcoin. Ammous added that the development of alternative cryptocurrencies cannot be classified as innovation since actual innovation will be built on top of Bitcoin itself.
Unlike other cryptocurrencies that haven’t been able to introduce features of any commercial value, he reasoned that software innovations such as BTCPay Server and multisig transactions have done just that. He then urged his audience to avoid other digital currencies and focus their attention on Bitcoin alone. In response to this rant, CEO of Shapeshift, Erik Vorhees, said that multiple tokens will always exist. In addition to being competitive, Vorhees suggested that the presence of alternatives would also be complementary and constructive to the cryptocurrency landscape.
Saifedean, this is just not true. One chain cannot optimize for all variables and all desired attributes of a digital asset. Thus multiple will exist, and further, while in part competitive, they are also in part complimentary and constructive. "Only BTC" is a weaker landscape.
— Erik Voorhees (@ErikVoorhees) July 19, 2019
Ammous’ belief has been termed by many in the cryptocurrency community as “Bitcoin maximalism”. Maximalists look beyond the merits and demerits of other blockchain-based digital currencies, choosing to instead focus on Bitcoin as the flagship cryptocurrency that will have a profound impact on global monetary and economic systems. This is quite similar to the supremacy of gold in the current precious metals market.
Altcoins Have, in Fact, Innovated
During an appearance on Episode 127 of the podcast “What Bitcoin Did”, Ammous said that his confidence in Bitcoin stems from the fact that there are only 21 million tokens in existence. Even if demand for the cryptocurrency increases exponentially, there will never be more than 21 million BTC in circulation.
While Ammous may be right about Bitcoin’s unique supply limitation, his statement conveniently glossed over countless innovations in other cryptocurrencies, such as NANO’s implementation of block-lattice, which provides feeless and instantaneous transactions, and Ethereum’s debut of smart contracts in 2014.
Bitcoin and the innovation surrounding it has been significant, the cumulative market cap of all cryptocurrencies today stands at roughly $285 billion. While Bitcoin alone takes up 65 percent of that figure, promising alternatives such as Ethereum, Litecoin could lead to a more competitive market in the future.
Do you agree with maximalists’ belief that Bitcoin is far superior to any other cryptocurrency on the market today and in the future? Let us know your thoughts in the comments below.