The “Blockchain Not Bitcoin” narrative has bee lurking around in the space for quite some time now. With the World Economic Forum held in Davos this year, however, it seems that it’s back with full force. Here’s why industry experts think it just doesn’t work.
Blockchain Not Bitcoin – Davos Theme
The World Economic Forum was held in Davos and it went under the theme of “Globalization 4.0”.
A prevailing opinion of the majority of traditional financial experts, however, was the all-so-popular “blockchain, not bitcoin” narrative.
But, apparently, it’s not just traditional financial experts who seem to share this belief. Legal expert and popular cryptocurrency commentator Jake Chervinsky also shared his observations on the matter:
“It’s 2019 and I’m sorry to report that “blockchain, not bitcoin” is still the default view among lawyers I meet who aren’t involved in the crypto scene.”
It's 2019 and I'm sorry to report that "blockchain, not bitcoin" is still the default view among lawyers I meet who aren't involved in the crypto scene.
I would love to bookmark a go-to article that concisely rebuts this cliche. Who wrote it best? Suggestions appreciated.
— Jake Chervinsky (@jchervinsky) January 30, 2019
But How Accurate is That Really?
One of the people trying to explain the fundamental flaws in this line of thinking is Rene Peters. In his writing called “Letter to those who “like blockchain and not bitcoin” he explains that blockchain, in its essence, is nothing but a database.
In fact, he outlines that it’s not even a particularly effective database. He says that information can be stored efficiently without having to rely on blockchain, while trust can also be established between different parties without a distributed ledger.
It’s Bitcoin that serves as a reward currency of a public blockchain (not a private one) which is used to transfer value. The benefit of using it in whatever form goes to everyone who participates in using the protocol layer – this happens through the appreciation of price because of the supply and demand economics.
Peters also explains that to like blockchain and not bitcoin represents an oxymoron. That’s because blockchain – without the incentivizing token based on game theory is nothing but a slow database.
What do you think of the “blockchain not bitcoin” narrative? Don’t hesitate to let us know in the comments below!