Bitcoin has strayed from its original plan of being a peer-to-peer digital cash, according to Bankymoon CEO and Centbee founder Lorien Gamaroff.
Gamaroff was speaking on the Matt Brown Show, broadcast from an event in Johannesburg.
The topic of the show was Bitcoin and its forks, such as Bitcoin Cash and Litecoin.
YouTube “investor” Adam Meister and derivatives trader Tone Vays also spoke at the event.
Gamaroff stated that Bitcoin’s reliance on second-layer solutions for scaling has detracted from its original purpose, and that Bitcoin Cash has the potential to overtake it thanks to its better design.
Bitcoin as cash
“The narrative of Bitcoin enthusiasts has changed to investment, due to its increase in value and unusability as a currency,” said Gamaroff.
“The people who start using cryptocurrencies as a payment method will choose those that are cheap, easy, and convenient,” he said.
Gamaroff said using a cryptocurrency is what makes it valuable, and investing in Bitcoin now is equivalent to betting that its will implement successful scaling solutions and become usable on a large scale.
Many Bitcoin backers have placed their hopes on the Lightning Network second-layer solution to solve the scaling problem, but Gamaroff said this defeats the original purpose of the cryptocurrency.
“Bitcoin Core needs to tear up the whitepaper,” said Gamaroff.
“With Lightning, we will bring the reliance on a trusted third-party back into the system and lose the concept of a peer-to-peer digital cash.”
He added that Bitcoin’s mistake is wanting maximum decentralisation and avoiding block size increases to allow this.
“You don’t need maximum decentralisation, you need sufficient decentralisation.”
When cryptocurrency is used as payment for everyday purchases, merchants and businesses will be the ones running a node, as they will have the biggest interest in verifying transactions, he said.
Gamaroff then backed Bitcoin Cash as a potential solution to cryptocurrency payments, stating that it is easier and cheaper to use than Bitcoin.
Adam Meister and Tone Vays disagreed with this evaluation of Bitcoin, and said Bitcoin Cash was just another fork which will not last.
Meister and Vays refer to the Bitcoin Cash fork as “BCash”, removing its link, in name at least, to Bitcoin.
They see Bitcoin as an investment vehicle and censorship-resistant value transfer system, and lauded its potential as a store of value.
“Bitcoin is a savings account and forks are crypto dividends,” said Meister.
He said that each fork of the Bitcoin blockchain will be less and less effective as an investment vehicle, until they all eventually lose to Bitcoin itself.
“BCash is nowhere near as decentralised as Bitcoin. I am surprised it has lasted this long,” said Meister.
Meister also shared his distaste of initial coin offerings, saying that most of them are “total scams” and he avoids them.
Vays then analysed Bitcoin from an investment perspective, saying it was at a critical point and could either skyrocket or plummet.
“Bitcoin is at a critical juncture, which could take us back up to new highs or down to new lows,” he said.
Vays refers to all other cryptocurrencies as “altcoins”, and stated that they were not worth purchasing as a long-term investment.
“I don’t think there is any other asset in the cryptocurrency market which is investment-worthy,” said Vays.
“All these altcoins and all these ICOs are penny stocks.”
When asked about the potential of cryptocurrencies like Ethereum, Bitcoin’s biggest competitor, Vays said the technology was useless.
“Ethereum is a completely useless technology. Ethereum’s only use case is to create other versions of Ethereum, on Ethereum.”
The full broadcast of the Matt Brown Show is posted below.