Over the past two years, there has been a fanatical rush towards the blockchain concept from legacy financial institutions and global corporations. The behavior towards this technology right now is similar to the Californian Gold Rush in the mid-1800s. With many individuals and groups flocking to distributed ledger solutions, the ones who strike gold will be focused on the bitcoin blockchain.
Also Read: Bitcoin: The Most Immutable Ledger of Them All
The Rush Towards Blockchain May Be a Fool’s Errand
Throughout 2015-2016 many headlines involved the concept of a blockchain being tested by some bank or agency attempting to transform their business. Typically, these stories included a description of how blockchain derived from the cryptocurrency bitcoin. However, these articles quickly steer towards the use of a private blockchain to meet the needs of the banks and businesses. These people in search of the coveted blockchain solution will likely fail because they will be digging up “fool’s gold.” This year technological expert Andreas Antonopoulos mocked these headlines earlier this year stating:
‘Major banks complete first international transaction using a blockchain’— You mean, the same thing bitcoin has done several million times?
Bitcoin is truly a revolutionary experiment that has changed how we look at money today. The digital asset is the longest running public distributed ledger in existence, and no blockchain prototype can match its strength. The cryptocurrency has the largest network of users, operators, developers, and people building applications with its code. Furthermore, the bitcoin network is immutable and has never “rolled back” to fix losses or major incidents. No altcoin, alternative consensus mechanism, or the many private blockchain prototypes come close to bitcoin’s massive power.
‘Bitcoin Is Useful and Scarce’
There are millions of dollars flooding into the pockets of those building private and public alternative blockchains. Recently there has been some decline in venture capital investment towards bitcoin-related projects, but there has still been a handful of investments. Investments that focus on working with bitcoin will be the ones who strike gold in the search for blockchain solutions. Others in search of blockchain without bitcoin will be sifting the river finding nothing but worthless stone.
Besides the obvious strength of bitcoin’s blockchain over eight years, the cryptocurrency is now a $14 billion dollar market with a significantly sized infrastructure. There are many projects in the midst of building revolutionary software by harnessing bitcoin’s potential. This includes remittances, settlements, social media applications, proof-of-existence, anonymity applications, decentralized marketplaces and exchanges, all aiming to utilize bitcoin’s benefits. If there’s any gold lining in the hunt for a useful blockchain, bitcoin has filled this need.
“Economists and journalists often get caught up in this question: Why does bitcoin have value?” Shapeshift founder Erik Voorhees once detailed. “And the answer is very easy. Because it is useful and scarce.”
There Are Many Gold Mines Within the Bitcoin Blockchain
When it comes to an evolutionary experiment with a significant network effect, bitcoin will be there for those in search of real digital gold. Over the past eight years, bitcoin is still a nascent concept, but it is the strongest peer-to-peer distributed ledger that offers vast amounts of innovation. During the gold rush in the past, very few “forty-niners” found the precious metal. With the blockchain rush, very few people will find digital gold. However, those focused on bitcoin have a better chance of finding a gold mine in their search for innovative technology.
What do you think about the rush towards blockchain? Do you think not focusing on bitcoin’s blockchain is a fool’s errand? Let us know in the comments below.
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