Bitcoin maximalists are quick to point out that Bitcoin (BTC) was the first cryptocurrency. They believe that the internal structure and original vision of Bitcoin not only provide useful answers to legacy-finance options, but are vastly superior.
As the below graphic indicates, Bitcoin takes only a fraction of the time and cost of Western Union and others. It should be clear to most observers that the market-leading cryptocurrency provides a real solution for remittance needs.
The question, of course, is whether Bitcoin is really the best or if other altcoins can do what it does — but better. In fact, Anthony “Pomp” Pompliano’s aforementioned tweet was met with an onslaught of posts about other coins, with each post claiming that its preferred coin was the answer.
As the old adage goes, imitation is the sincerest form of flattery.
Centralized Altcoins vs. Decentralized Bitcoin
One of the coins that receives the most attention in this argument is XRP, the coin designed by major fintech company Ripple. Devotees are quick to argue that XRP’s transactions per second (TPS) and fee structure are far superior to those of Bitcoin. XRP proponents often suggest that it will eventually replace BTC.
However, with XRP — as well as with some other blockchain-based solutions — the issue is governance. XRP is a centralized system with centralized governance. In other words, Ripple makes the rules.
Other coins, in spite of protestation, are centralized as well. For example, the recent Constantinople delay-and-upgrade on the Ethereum (ETH) blockchain has shown that ‘community’ governance doesn’t always exist.
These are just two examples of the centralization problem in the altcoin space. When cryptocurrencies claim to be like Bitcoin, users should be careful. A blockchain solution with centralized governance is hardly different from legacy options.
In fact, the fact that JPM Coin — JPMorgan’s own cryptocurrency — was hailed as a ‘Ripple-killer’ should prove that the issue of decentralization is key.
The other argument against Bitcoin is its transaction time. Among all non-legacy solutions, the first and foremost cryptocurrency is among the slowest. Detractors would argue that this makes Bitcoin an easy mark for other blockchain platforms looking to supplant it.
While it is true that other solutions may offer faster transaction speeds, Bitcoin continues to evolve. Solutions like SegWit and the Lighting Network are continuing to move the platform forward, and these solutions offer greater transaction speeds while, at the same time, maintaining the decentralization and autonomy that BTC provides.
Bitcoin leads the market — and for good reason. While other solutions may come and go, Bitcoin’s overall value proposition remains uniquely suited to the next generation of financial needs.
Think Bitcoin (BTC) will remain the coin of choice going into the future, or will a different digital currency come to have dominance in the non-traditional finance market? Let us know in the comments below!