“Bitcoin (BTC) easily outperforms other cryptocurrencies in multiple fundamental areas, which guarantees its future as a reference or standard”, the academic Konrad S. Graf has concluded.
In the second installment of a two-part interview with Eurasia Review published on January 1, Graf highlighted several “competitive advantages” inherent in the BTC. Graf has sought to make cryptocurrency more widely known, through academic essays, which expand beyond its mechanism of action, to place it within the broader economic system, as he learned Cryptocurrency.
Shortage
To a large degree, Bitcoin outperforms other forms of money – including other cryptocurrencies – due to its fixed supply. “The main competitive advantage of Bitcoin… is its ability (to) restrict new issues, the relative reliability of its methods to control the production of units,” says Graf.
Being specific, the Bitcoin supply cannot be manipulated, nor can it change its maximum issuance —21 million units, therefore those factors cannot cause dilution.
No entity, no matter how powerful it is in terms of active computing power in the network, can decrease the value of the existing BTC in the hands of savers due to an increase in supply. This contrasts directly with cryptocurrencies with a mutable supply, such as Ethereum (ETH) and XRP, as well as with all fiat currencies.
Apolitical value transfer
The mentioned feature makes Bitcoin particularly useful for payments between entitiesor people, as a financial protocol immune to the traps of fiat money. Graf mentions the popular book by Saifedean Ammous, “The Bitcoin Standard,” which examines extensively the advantages of cryptocurrency over fiat money.
Ammous also shows how the BTC could function as a currency to settle payments without the need for intermediaries.
«Ammous argues that it is in the field of payments (considered by most people as something quite mysterious) where Bitcoin could find some of its most competitive applications. It could become not only a common and not political monetary unit, but also a direct competitor of the SWIFT system and any other existing or emerging rival”, Graf explained.
He goes on to say that: «In a world in which conventional systems are also politicized, Bitcoin has the advantage of being« neutral », in the sense that it is not controlled by any of the competing power blocks, which means that, potentially, anyone could participate.”
Despite the main altcoins, the technical skill of Bitcoin means that “its position as a market leader has been obvious for years“, says Graf. As Cointelegraph has also reported frequently, the hash rate alone has made progress of an order of magnitude better than that of Ethereum or other similar established markets.
He goes on to say that: «The BTC currently has 97 exahashes protecting its network, compared to the 2.5 exahashes of the BCH, which gives the BTC a hash rate 39 times higher than that of its closest competitor in digital money,” he continues.
That attribute also differentiates Bitcoin from imitators with very similar characteristics: the principle may be the same, but the distribution of the hash rate, or centralization, and the activity in those other networks pale in comparison.
It is not an entity
On the issue of centralization, One final advantage that Bitcoin has over “corporate” blockchains is its lack of weaknesses that political actors can attack. This benefit has become more evident in 2019, the year in which Facebook revealed and subsequently faced a global reaction over its digital currency protocol, Libra.
Executive director Mark Zuckerberg appeared before US lawmakers several times, amid criticism claiming that Facebook was trying to eliminate government monopolies with the proposed stablecoin.
“There is no CEO who can summon Washington to be questioned,” Graf concludes about Bitcoin.