On Wednesday Vinny Lingham, co-founder and CEO of Civic.com in a post on Medium outlined his three phases of Bitcoin.
The crypto entrepreneur and expert thinks it is the success of the first two phases that will drive the breakthrough of the last one. From his outlook no technology elsewhere will enable another cryptocurrency to get bigger than Bitcoin any time soon.
When Cointelegraph asked him why he has that opinion, Vinny attributed it to Metcalf Law. This hypothesis affirms that the importance of a network is equal to the number of connected users in the network. "Bitcoin has an enormous network effect, similar to Facebook," he wrote.
Satoshi’s notion misleading
According to him, Satoshi whitepaper definition of Bitcoin as “Peer to Peer Electronic Cash System” misled many people. However, he acknowledges it is a great long-term vision that must develop through phases.
From 2008 to 2016 Bitcoin believers have gone through experimental stages of the digital currency grappling with volatility, skepticism, subjugation from authorities to near acceptance. The past eight years saw Vinny Lingham always insisting Bitcoin has not yet matured as a currency:
"I think it’s a commodity that can be traded for goods and services. It may become a currency in time, but it just isn’t one right now. It’s a scarce, digital commodity — and the trading that takes place on exchanges really reflects the market sentiment around the value of this digital commodity."
Vinny added in the blog that "a commodity is a basic good in an economy which, though it may exist in different grades, A, B, C, etc, is essentially homogenous and easily tradeable. Gold, silver, and other precious metals are good examples of commodities, but then again so are wheat, corn, pork bellies, etc."
Make Bitcoin boring again
No doubt stability is essential to the ecosystem and the key to making the first digital asset a store of value. The Civic.com chief admits volatility at this stage of Bitcoin's evolution is detrimental to making Bitcoin a store of value:
Vinny told Cointelegraph:
"Yes, that's the focus of my last post 'Making Bitcoin Boring again”. Pare down the enthusiasm. The current price levels need to consolidate for a while and let's hope for slow and steady growth. If it moves up too fast, it will become volatile again."
Even though adoption has been encouraging but it is still slow especially in the developing world where Bitcoin has a huge potential to offer Economic Freedom. Vinny revealed that the more people are comfortable to store Bitcoin, the more merchants will accept Bitcoin for payment of goods and services.
The recent bull run of Bitcoin has also attracted the talk of an imminent bubble. When asked whether we are heading into a bubble if things remain same; This was his prediction:
"I think that if we go above $4,000 this year, we will be in a bubble. it should be slow and steady growth to $3,000. The best we can hope for is that it stays below $2,000 for the next three months at least."
Gold Vs Bitcoin
Two days ago, before Bitcoin’s gradual decline it surpassed the price of an ounce of Gold to make history as the first currency to do that. Vinny Lingham contemplates that that is not scary since gold is overpriced:
"When the Euro breaks up, countries like Italy and France are going to have to sell a lot of Gold to finance their deficits." Gold price will fall, then the Dollar rises, Euro falls."