If you’re looking for a clue to the big picture as Bitcoin continues its sideways crawl around $6400, you could do worse than considering the outlook of Vinny Lingham, a South African entepreseur with several major projects under his belt.
Lingham’s identity management service startup, Civic, manages credit reporting and gives consumers tools to battle identity fraud. Lingham’s past projects include Gyft, Yola and SiliconCape, which promoted the African Cape as a technology hub.
Essentially, he’s telling long buyers to hold on. But his reasoning gets to the heart of how coin currencies float around a market controlled by complex vectors of businesses, organizations, and governments.
Talking to assembled investors and crypto enthusiasts, among others, Lingham points out that governments are often at cross purposes with crypto companies and backers because “it (cryptocurrency) threatens their ability to make money.”
However, practically in the same breath, he makes the caveat that you can’t really hold Bitcoin back forever.
“Every country will issue their own cryptocurrencies,” Lingham said. “Many countries will. And that will become interesting. And that is going to happen.”
Why are governments “against Bitcoin?”
This Investopedia guide gives a pretty good review, talking about how decentralized currency lacks many of the controls that economic agencies use to “keep us safe.”
In a real sense, cryptocurrency is like open source software.
Think of how open source products are different than vendor products. They’re DIY – instead of a corporate backer that will show up to do tech support and also charge for it, there’s just a community – and that means there’s really no central command point for the currency. That comes with some big pluses and minuses.
A Forbes story from early this year speaks to some of the perils of having currencies not backed by a national treasury.
“Private currencies, including cryptocurrencies, are not regulated and have very little, if any, protection against price manipulation,” wrote Jay Adkisson in January. “The only self-policing that exists is the market itself, which is to say that investors in a cryptocurrency may quit buying at a given price if they suspect that price manipulation is occurring, but maybe not.”
So there are arguments both ways – on the one hand, crypto is volatile, and isn’t subject to a lot of regulation. On the other hand, it’s probably, as Lingham says “imminent,” and besides, it offers a lot of innovative benefits.
Or you could take a page from Daniel Staudigel at HackerNoon, in a treatise entitled “Bitcoin: the Good, the Bad and the Ugly” where the author shows how crypto is inherently deflationary (but not unconditionally,) how it’s pretty darn secure (putting the onus on its holders to guard it from theft) and how it actually takes quite a bit of CO2 to mine.
Staudigel also points out that the only thing constant is change. Maybe if we find ways to deal with the down sides of crypto, we’ll be more poised to take advantage of its coming glory.