Bitcoin has been met with controversy since inception in 2009. “A government does not back Bitcoin,” and “Bitcoin only has value because some people think it has value,” are common – but uninformed – opinions of the decentralized digital asset. John Crudele of the New York Post is among the Bitcoin cynics, but his reasoning is flawed.
In 2014, Crudele published an article criticizing MIT students that wanted to issue $100 worth of Bitcoin to every student on campus. Now, he’s back at it again – on July 5, 2018, he published an article condemning Bitcoin once more, highlighting its recent crash below $7,000:
“Bitcoin’s price rallied to over $6,600 yesterday, but it had been well under $6,000 last week. Even at $6,600, bitcoin is still worth 70 percent less than it was at the beginning of the year. I use the term “worth” cautiously because bitcoin is really worth nothing, since it’s backed by nothing or no one. It’s a confidence game that has value only because people are convincing other people that it’s worth something.”
First, despite Bitcoin’s price retracement, it is still worth approximately 13 times more than it was in 2014 when he chastised the MIT students (worth around $500 at that time).
The students that wanted to issue $100 of Bitcoin to everyone on campus raised $500,000 for the project. In December 2017, when Bitcoin hit its all-time high just shy of $20,000, their $500,000 of Bitcoin would’ve been worth around $20 million dollars.
“It’s backed by nothing or no one” is a point that Crudele continues to argue, which makes it clear he does not understand how blockchain technology works.
The crux of Bitcoin is that no one – no banks, credit card companies, or governments – are in control of it. Bitcoin is strictly a peer-to-peer currency, which is one of the primary reasons why Bitcoin and blockchain are so revolutionary.
In essence, anything that possesses value, including USD, Euros, gold – and yes, Bitcoin – has value because people give it value. Since Crudele’s initial 2014 post, a plethora of businesses and governments have adopted blockchain technology.
As the rest of the world wakes up to the power of blockchain technology, the New York Post remains in a deep, crypto-ignorant slumber.
Cover Photo by Björn Simon on Unsplash