Could Bitcoin be Dethroned by an Altcoin?

Cryptocurrency aficionados have been discussing Bitcoin limitations ever since the blockchain buzz hit the street. Geeks toss around ideas for clearing transactions faster, resisting potential attacks, rewarding miners after the last coin is mined, and supporting anonymity (or the opposite—if you lean toward the darkaltcoins side). There are many areas in which Bitcoin could be improved, or made more conducive to one camp or another.

Distinguished Penn State professor, John Carroll, believes that Bitcoin may eventually be marginalized due to its early arrival. He believes that its limitations will eventually be overcome by newer “altcoins”, presumably with improved mechanisms.

So, does progress in any of these areas threaten the reigning champ? It’s unlikely…

More than any other individual, Andreas Antonopoulos is the face of Bitcoin. We discussed this very issue in the outer lobby of the MIT Bitcoin Expo at which he was keynote speaker (March 2015). Then, we discussed it again, when I hosted his presentation at The Bitcoin Event Andreas Antonopoulos-01sin New York (also in March). He clearly and succinctly explained to me why it is unlikely that an altcoin will replace Bitcoin as the dominant—and eventually surviving—cryptocurrency

It is not simply that Bitcoin was first or derived from Satoshi’s original paper, although this clearly established precedent, propelled it into the media, and ignited a grassroots industry. More importantly, Bitcoin is unlikely to be surpassed by an altcoin because:

  1. Bitcoin is open source. It is difficult enough for skeptics to accept that an open source protocol can be trusted. Users, businesses, banks, exchanges and governments may eventually trust a distributed, open source movement. After all, math is more trustworthy and less transient than governments. Math cannot inflate itself, bend to political winds, or print future generations into debt if it is tied to a cap. But it is unlikely that these same skeptics will allow an inventor with a proprietary mechanism to take custody of their wealth, or one in which the content of all wallets cannot be traced back to the origin.
  2. If we accept #1 (that a viable contender must be open source and either public or freely licensed), then Bitcoin developers or wallet vendors are free to incorporate the best protocols and enhancements from the alt-developers. They can gradually be folded into Bitcoin and adopted by consensus. This is what Gavin and the current developers at Bitcoin Prime do. They protect, enhance, extend, and promote. Looked at another way, when a feature or enhancement is blessed—and when 3 or 4 of the leading 7 wallets honor it, it becomes part of Bitcoin.

Bitcoin has achieved a two-sided network effect, just like Acrobat PDF. Unseating an entrenched two-sided network requires disruptive technology and implementation with clear benefits. But in the case of a widely distributed, trusted and universally adopted tool (such as a public-use monetary instrument), a contender must be open source. The Cryptocurrency Standards Association, The Bitcoin Foundation and the leading wallet vendors have always been open and eager to incorporate the best open source ideas into Bitcoin.

Even if Bitcoin were replaced by an altcoin or by “Bitcoin 2.0”, it is likely that the public would only migrate to the enhanced coin if it were tied to the original equity corpus of earned and mined coins from the Bitcoin era. That is, we all know that Satoshi may have thousands of original Bitcoins, but few among us would tolerate (a) losing all of our Bitcoin value, and (b) rewarding a blockchain wannabe who declares that his coins are worth more than the grassroots legacy of vested millions that came before.

string_can_phoneConsidering Prof Carroll’s analogy: “Who will use an acoustic string telephone when he could access a mobile phone.” A more accurate analogy is the evolution of the 32 year old AMPS phone network (the first widely deployed cell phone network). In 1983, the original phones were analogue and limited to 400 channels. Like their non-cellular predecessors, user equipment was bulky. Phones were divided into bulky components in the trunk, under the seat and a corded handset. They lacked GPS, LTE and many signaling features that we now take for granted. Yet carriers, equipment manufacturers and users were never forced to throw away equipment and start over. The network grew, adopted, and yielded incentives for incremental user-equipment upgrade.

With all due respect to the distinguished Penn State professor, John Carroll, Wild Ducks believe that Bitcoin need’t relinquish the throne. It is evolving!

Ellery is a board director of The Cryptocurrency Standards Association
This article was published simultaneously in the Lifeboat Foundation Blog

Related: Stellar & Ripple: Pretender to Bitcoin throne?

Will a ban on hand’s free phones make driving safer?

The National Traffic Safety Board is very concerned about distracted driving. Their research and testimony was instrumental in shaping statutes in 35 states that ban texting while driving and the 9 states that ban the use of handheld phones (many more states have partial restrictions). If you have ever tried using a tiny keyboard (for example, typing a destination into a GPS device) while gliding down a highway or even a side street, then you know it is very risky to say the least.

Studies on the effects of laws are often ambiguous, because so many extraneous variables are at play before and after the law goes into effect. But in the case of texting while driving, studies are conclusive. Applying this data, I am reasonably confident that at least 3 people reading this blog in the week it was posted are alive because of one of these laws.

When the NTSB first suggested that handheld use of cell phones should be banned, I was surprised at the specificity of their wrath. Don’t we already punish “Driving while distracted”? Keeping laws general seems so much simpler and fair. Why should a cell phone user be restricted but not the lady in the next lane applying mascara or the guy drinking coffee and shaving at the same time?

Perhaps one reason for a targeted restriction is because the technology is newer and more insipid. It takes a few years before most drivers recognize how dangerous it is to hold a portable device while driving. In my opinion, a phone is used in a very different manner than a cup of coffee. Doing those other things (applying makeup and shaving) is just plain stupid. These things require that your eyes and full attention be on the mirror and not the road.

Perhaps a ban on cell phones is palatable because it relieves traffic officers and courts from the vagaries of interpretation. Either way, I accept the restriction. I make a serious effort to ensure that an automatic hands free connection is established each time that I enter my car. I wasn’t truly happy with wireless speakerphones until I found a simple and effective Bluetooth speaker that recognized when I was inside the vehicle. The detection of an occupant is a major step forward, because it ensures that calls from home are not hijacked by the device in my parked car.

But now, the NTSB has gone too far. They are recommending a complete ban on the presence of mobile phones in cars. What’s next? Why not Prohibit drivers from talking with passengers? (Apparently, they believe that talking with a caller is more dangerous). Even if studies demonstrate a link between talking and safety, the research technique cannot possibly factor in the dramatically increased safety and reduced driving of those who keep in touch with business and loved ones, especially if the call pertains to their reason for driving in the first place.

Consider an example: Suppose that the research conclusively demonstrates that a call doubles the chance of a serious accident from 1 in 150,000 miles to 2 in 150,000 miles. What if the call removed the car from the road because the whole trip is unnecessary? Is that covered by the study? For example, suppose that you are rushing to the airport to pick up an elderly relative who is ill and forgot critical medicine. They don’t speak English and – well – you get the idea… You are under stress, speeding and very concerned about someone else’s safety. Anyone will acknowledge that the risk of an accident is heightened. You are aware of this, but you are good driver. You are not tired and you weigh the risk against your personal mission.

Now suppose that this relative called you from another airport. They missed their flight and they will not be arriving as expected. But wait! They ran into the family doctor at the airport. He has the required medicine and will even give Grandpa a lift home. I realize that the example is a bit contrived and melodramatic, but the gist is broadly applicable. Accepting the call in the car not only removes a source of stress, it makes the entire trip unnecessary. While not every call saves tires, gas, stress and lives—many calls make business and personal life more efficient. In turn, this reduces stress and the need to drive. The relationships between these things are intangible and difficult to measure, but the net effect is very tangible. It would be difficult to incorporate control mechanisms that relate to these factors and almost impossible to set controls and measure results. (How is overall traffic safety influenced by reducing the need to drive? The influence goes beyond the individual driver!) They are perhaps more important components of overall safety than all the things that can be measured.

Banning the use of all telephone communication in cars is not just foolish, it is political idiocy. Fortunately, I’m not the only one who thinks so. If you don’t agree with me after the very slightest of reflection then post a comment. But be prepared for my retort. In my opinion, anyone who disagrees with me just hasn’t thought enough about the issue! (Eventually, you will get it right!)

More reading: