[Bit]coin flipping: “Blockchain will outgrow Bitcoin”
The discussion about cryptocurrencies is nowhere near over, especially now that the Bitcoin halving has proved that the saying “what doesn’t kill you makes you stronger” may actually be true. Stephen DeMeulenaere, the co-founder of Coin Academy, the first digital currency education platform, signals that the future of cryptocurrencies is bright and that Bitcoin will continue to grow.
The second Bitcoin halving has come and gone without a substantial effect on this cryptocurrency’s price. Still, some movement is bound to happen —some people directly involved in this matter claim.
We are talking to Stephen DeMeulenaere, the co-founder of Coin Academy, the first digital currency education platform, about the future of Bitcoin and blockchain and how cryptocurrencies have a role to play in the FinTech movement.
JAXenter: Mr DeMeulenaere, you are the co-founder of Coin Academy. What is Coin Academy and how did you come up with this idea?
Stephen DeMeulenaere: We noticed that some courses, such as the University of Nicosia’s MOOC, were designed for people who already had a high level of understanding and covered all the details. We didn’t see a course that focused on what people needed to learn to start using digital currency in a safe way.
Ric Shreves, (the other co-founder) and I both have a background in education, and I have been actively involved the currency movement’s community in the past two decades, so we produced several courses and curated some more.
JAXenter: Do you agree with the following statement: Bitcoin represents the marriage between Wall Street and Silicon Valley?
Stephen DeMeulenaere: I don’t agree at all! Wall Street promotes a completely different philosophy of economy and money than Bitcoin does. Some people would like Bitcoin to join Wall Street, but others think that is a bad idea. Most people want it to go in a very different direction. Bitcoin started as a response to the situation that caused the 2008 financial crisis.
Silicon Valley had a big role to play in Bitcoin’s development, but so have developers in many places around the world.
JAXenter: You say that Bitcoin started as a response to the situation that caused the 2008 financial crisis. In the event of another financial crisis how will Bitcoin help preserve our stability?
Stephen DeMeulenaere: The normal response would be to say that platforms like Bitcoin can provide a safe place for money to be stored, like gold, until a better solution is found or the economy returns to normal. However, given that the US Federal Reserve has almost no reserves to deal with another crisis, even a smaller crisis than 2008 could potentially put the US dollar-based international monetary system in the grave.
In such a case, Bitcoin could be used, along with other stores of value, to reconstruct a monetary system with a new medium of exchange and method of issuance. I believe that Mutual Credit, a type of network economy monetary system which allows members to issue their own credit and accept the credit of others as the basis for issuing money into an economy is a sound foundation for a monetary system. There are several thousand examples of this type of monetary system in use today, and the WIR Bank in Switzerland is one example.
JAXenter: Could Bitcoin be our safety net?
Stephen DeMeulenaere: Like gold, we can protect our savings in Bitcoin. If a crisis of any size happens, we can be sure that the price of Bitcoin will rise.
Cryptocurrencies are still in their infancy and still most attractive to people with a technical background.
JAXenter: What would regulation mean for digital currencies? How would this impact the FinTech movement?
Stephen DeMeulenaere: Regulation is happening as fast, or as slow as it takes regulators to understand what it is, and regulations are being negotiated in a very different way than usual. The case of regulation in New York is a good example — it drove many businesses to leave the state and look elsewhere, like London, Singapore or Amsterdam which have more advantageous regulations. ‘Regulatory Arbitrage’ is forcing regulators to take a market-oriented approach to creating regulations, now that they realize the impact it can have on the market.
JAXenter: Since founding Coin Academy you’ve probably come across many reactions regarding cryptocurrencies. Are people willing to give digital money a shot or is it bound to fail?
Stephen DeMeulenaere: Cryptocurrencies are still in their infancy and still most attractive to people with a technical background or a strong need to convert national currency into something that is more mobile. There is still a long way to go and making acquiring, securing and spending digital currency a seamless experience will not be done overnight.
That being said, Bitcoin has already reached the capacity limits of its first phase, so it’s already an overwhelming success. The threat of failure is what determines so many people to work hard to prevent that scenario from happening.
JAXenter: You mentioned that the threat of failure is the engine that drives people to work hard and prevent digital currencies from going downhill. What are those precautionary measures? What do people do to prevent cryptocurrencies from drowning?
Stephen DeMeulenaere: The Bitcoin system, as we have seen, is rather centralized. The system depends on miners’ decisions (more than any other group), and this has caused problems within the group of core programmers. Despite this, efforts are being made to keep the channels of communication open so that the best solution can be found.
Like gold, we can protect our savings in Bitcoin.
In the end, everyone with a stake in Bitcoin wants it to succeed, and that is this cryptocurrency’s strength. The consensus model is keeping the platform strong while discussions about how to improve it continue.
JAXenter: More and more traditional banks are embracing blockchain’s potential — but they seem to have excluded Bitcoin from this equation. Will blockchain outgrow Bitcoin?
Stephen DeMeulenaere: Yes, it certainly will. There will be a place for Bitcoin for many years to come, and it is by far the strongest blockchain. However, it is natural for new blockchain platforms to be created, like Ethereum, which have the potential to be orders of magnitude larger, faster, more efficient and handle many more types of data than Bitcoin was designed to handle.
JAXenter: Where do you see Bitcoin in two years? How about other cryptocurrencies?
Stephen DeMeulenaere: Bitcoin will be in its next phase as a result of continuous technical improvements and improved collective governance. Distributed collective intelligence works, and the challenges the system has been experiencing lately are teaching valuable lessons about how we can eventually change how we govern ourselves in many other ways.
Ethereum, the No.2 cryptocurrency recently passed 1 Billion USD in market capitalization. They and other cryptocurrencies that fulfill important functions will continue to grow.
JAXenter: What is your take on Ethereum? Some people see it as the future Bitcoin in terms of success while others think its fame is short-lived. Which side are you one and why do you think Ethereum got so big, so fast?
Stephen DeMeulenaere: I like Ethereum, and I like an even bigger project behind it called Ceptr, which can be found at ceptr.org. I also like Ripple, Cryptonote, Dash, NXT and BitsharesX. Each of these platforms is bringing something unique to the ecosystem.
I would bet against Ethereum’s fame being short-lived, and I’m sure there is a bet on that going on Augur or Bitmoose. Ethereum offers a lot of opportunities that haven’t even begun to be explored yet, so it is way too early to be discounting it. It’s also easy to be skeptical, just as about 99 percent of people who heard of Bitcoin in 2009 were. Skepticism is a good thing, we should not follow some trends blindly.
Intercommunicating blockchains are going to become the foundation for a distributed, internet ecosystem which cannot be centralized that will allow us to exchange a wide variety of forms of value that will make debt-issued national currencies obsolete. We’ve got more work to do to get there.
Thank you very much!