Ethereum bitcoin replacement

Citadel's Ken Griffin thinks bitcoin will be disrupted by a superior cryptocurrency based on ethereum's blockchain in the future, according to a Wednesday interview with DealBook's Andrew Ross Sorkin. The comments came after Griffin said the only way one can value cryptocurrencies is by hoping that someone will buy them at a higher price in the future. Griffin remains skeptical of crypto, and to this day sees no commercial use cases for bitcoin due to its large energy footprint, low transaction speeds, and vulnerability to fraud. On the underlying blockchain technology that powers cryptocurrencies, Griffin said it's "really interesting technology, a powerful way to maintain a decentralized ledger around the world, but for most problems, it's really not the solution that we need," Griffin said. As for bitcoin, Griffin believes a next generation cryptocurrency based on the ethereum blockchain will likely displace it due to its faster transactions per second, smaller energy footprint, and lower transaction costs.

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Content:

• 20 Blockchain Predictions for 2020
• Why bitcoin and cryptocurrency values are dropping quick
• Digital currencies: No substitute for stocks, bonds
• Cryptocurrencies Won't Replace Currencies: They Will Replace Stock Exchanges
• Bitcoin alternatives: the most important other cryptocurrencies
• Ethereum vs Bitcoin: Which crypto will come out on top?

WATCH RELATED VIDEO: Why Ethereum Will Replace Bitcoin and Become the #1 Crypto in 2021

20 Blockchain Predictions for 2020

You should not invest in Bitcoin. These are all things that people have bought in the past, driving them to absurd prices, not because they did anything useful or produced money or had social value, but solely because people thought they could sell them on to someone else for more money in the future.

When you make this kind of purchase — which you should never do — you are speculating. This is not a useful activity. Even if you win money through dumb luck, you have lost time and energy, which means you have lost. Investing means buying an asset that actually creates products, services or cashflow, such as a profitable business or a rentable piece of real estate, for an extended period of time.

An investment is something that has intrinsic value — that is, it would be worth owning from a financial perspective, even if you could never sell it. Blockchain is simply a nifty software invention which is open-source and free for anyone to use , whereas bitcoin is just one well-known way to use it. As a real-world comparison for blockchain and bitcoin , take this example from the blogger The Unassuming Banker :.

Imagine that someone had found a cure for cancer and posted the step-by-step instructions on how to make it online, freely available for anyone to use. Now imagine that the same person also created a product called Cancer-Pill using their own instructions, trade marked it, and started selling it to the highest bidders. I think we can all agree a cure for cancer is immensely valuable to society blockchain may or may not be, we still have to see , however, how much is a Cancer-Pill worth?

Our banker goes on to explain that the first Cancer-Pill bitcoin might initially see some great sales. Prices would rise, especially if supply was limited just as an artificial supply limit is built into the bitcoin algorithm. But since the formula is open and free, other companies quickly come out with their own cancer pills.

Anybody can make a pill, and it costs only a few cents per dose. This screenshot from coinmarketcap. Bitcoin AKA Cancer-Pills has become an investment bubble, with the complementary forces of human herd behavior, greed, fear of missing out, and a lack of understanding of past financial bubbles amplifying it. To better understand this mania, we need to look at why bitcoin was invented in the first place. As the legend goes, in an anonymous developer published a white paper under the fake name Satoshi Nakamoto.

The author was evidently a software and math person. But the paper also has some in-built ideology: the assumption that giving national governments the ability to monitor flows of money in the financial system and use it as a form of law enforcement is wrong. This financial libertarian streak is at the core of bitcoin.

Government-issued currencies have value because they represent human trust and cooperation. There is no wealth and no trade without these two things, so you might as well go all in and trust people.

Bitcoin has none of these things, and even safely storing it is difficult. Bitcoin exchanges such as Mt Gox in Japan, Bitfinex and various other wallets and exchanges have been hacked. The second point is crucial. Bitcoin is only valuable if it truly becomes a critical world currency. Right now, speculators are the only people driving up the price. A speculative cult currency like bitcoin is only valuable when you cash it out to a real currency, like the US dollar, and use it to buy something useful like a nice house or a business.

When the supply of foolish speculators dries up the value evaporates — often very quickly. A currency should also not be artificially sparse. It needs to expand with the supply of goods and services in the world, otherwise we end up with deflation and hoarding. It helps to have the Federal Reserve system and other central banks guiding the system.

Full anonymity and government evasion will not be one of its features. The cryptocurrency bubble is really a repetition of the past. This is a known bug in our operating system, and we have designed some parts of our society to protect us against it. These days, stocks in the US are regulated by the Securities and Exchange Commission, precisely, because in the olden days, there were many stocks issued that were much like bitcoin, marketed to unsophisticated investors as a get-rich-quick scheme.

A version of this post originally appeared on the blog mrmoneymustache. So you're thinking about investing in bitcoin? An investment is something that has intrinsic value, not speculative value. Bitcoin and cryptocurrencies 'will come to bad end', says Warren Buffett. Read more. Bitcoin is a bubble, but the technology behind it could transform the world Will Hutton.

Topics Bitcoin Investing Cryptocurrencies Economics features. Reuse this content.

Why bitcoin and cryptocurrency values are dropping quick

Bitcoin's lofty valuation and manic price swings receive intense news coverage, but Ethereum may provide the foundation to build an alternative worldwide financial system. Ethereum, the world's second most popular cryptocurrency, has generated innovative financial products that could lead to decentralized finance, called "DeFi" in crypto circles, allowing for peer-to-peer transactions without using a commercial bank. Louis Federal Reserve Bank. Smart contracts automatically launch computerized transactions when specific conditions are met.

Digital currencies: No substitute for stocks, bonds

Whatever your opinions on cryptocurrencies — from a dyed-in-wool fanatic to utter skeptic — the fact remains that these digital assets are becoming a more important part of the payments world. We are seeing this fact play out on the Mastercard network, with people using cards to buy crypto assets, especially during Bitcoin's recent surge in value. We are also seeing users increasingly take advantage of crypto cards to access these assets and convert them to traditional currencies for spending. To be clear, this data is not of any individuals — it's anonymized and in aggregate — but the trend is unmistakable. We are preparing right now for the future of crypto and payments, announcing that this year Mastercard will start supporting select cryptocurrencies directly on our network. This is a big change that will require a lot of work. We will be very thoughtful about which assets we support based on our principles for digital currencies, which focus on consumer protections and compliance. But we are here to enable customers, merchants and businesses to move digital value — traditional or crypto — however they want. Doing this work will create a lot more possibilities for shoppers and merchants, allowing them to transact in an entirely new form of payment. This change may open merchants up to new customers who are already flocking to digital assets, and help sellers build loyalty with existing customers who want this additional option.

Cryptocurrencies Won't Replace Currencies: They Will Replace Stock Exchanges

From barter, to the appearance of the Mesopotamian shekel 5, years ago, to gold coins, to the paper dollar, what constitutes money has evolved. Is the next step in that evolution the replacement of coins, paper bills and electronic accounts at commercial banks by cryptocurrencies like Bitcoin, Ethereum, Libra and Dogecoin? There are ongoing concerns about the volatility of the price of cryptocurrencies, their use for illegal and illicit transactions, their environmental impact, and the potential they pose for disrupting financial systems. What do we know about the actual and potential benefits and costs of cryptocurrencies to their users, and to society at large?

Bitcoin alternatives: the most important other cryptocurrencies

Former Twitter Inc. What Happened: Dorsey shared his views on the crypto space in a series of tweets sent this week. When rapper Cardi B asked him if crypto will replace the dollar, he said that "Bitcoin will. This statement should not come as a surprise given that he has rarely been shy of expressing his stances on how Bitcoin should be held in higher regard than other cryptocurrencies — which resulted in him being often described as a Bitcoin maximalist. Dorsey recently even said that if he was not working at Block Inc. NYSE: SQ — the bitcoin-friendly financial services firm previously known as Square — or Twitter where he recently resigned , he "would be working on Bitcoin.

Ethereum vs Bitcoin: Which crypto will come out on top?

ETH — the asset, not the Ethereum Network itself — will go to zero. Ethereum is a decentralized platform that runs smart contracts : applications that run exactly as programmed without any possibility of downtime, censorship, fraud or third-party interference. These apps run on a custom built blockchain, an enormously powerful shared global infrastructure that can move value around and represent the ownership of property. This enables developers to create markets, store registries of debts or promises, move funds in accordance with instructions given long in the past like a will or a futures contract and many other things that have not been invented yet, all without a middleman or counterparty risk. If Ethereum succeeds on its value proposition it will therefore mitigate external risk factors for decentralized applications.

You should not invest in Bitcoin. These are all things that people have bought in the past, driving them to absurd prices, not because they did anything useful or produced money or had social value, but solely because people thought they could sell them on to someone else for more money in the future. When you make this kind of purchase — which you should never do — you are speculating. This is not a useful activity.

This latest upward movement seems to indicate that an alt-season may be underway, especially as a number of other assets — including Cardano and Solana — have also been on the receiving end of some serious bullish action. It will be interesting to see how the coming few weeks play out for the altcoin price-wise, especially with experts like Dmitry Mishunin, founder and CEO of smart contract audit firm HashEx, predicting that ETH could quite easily flip BTC in the near term, adding :. How to buy Ethereum. Furthermore, as per crypto data aggregator Dune Analytics, the last year or so has seen a record number of people enter the DeFi ecosystem, with the figure currently standing at around 3,, users accurate as of Aug. In a surprising turn of events, Larva Labs, the team responsible for creating CryptoPunks, one of the largest NFT-based collectible games in the world, announced that it had entered into an agreement with prominent Hollywood talent recruitment firm United Talent Agency UTA. Interested in cryptocurrency?

Expert insights, analysis and smart data help you cut through the noise to spot trends, risks and opportunities. Sign in. Accessibility help Skip to navigation Skip to content Skip to footer. Become an FT subscriber to read: Central bank digital currencies may not replace crypto, BIS says Leverage our market expertise Expert insights, analysis and smart data help you cut through the noise to spot trends, risks and opportunities. Join over , Finance professionals who already subscribe to the FT.

The biggest cryptocurrencies have had a rough few months. If you listened to Matt Damon's Crypto. At the time of writing , both bitcoin and ethereum were down by about 45 percent compared to their highs from last November; BNB was down 42 percent.