By Mark Nesbitt
Crypto is a rapidly growing space, with many views on how it might evolve. This series explores various ideas on crypto’s future and does not necessarily reflect the view of Coinbase.
TLDR: This post explores a typical evolution of understanding Bitcoin, how its most common criticisms can actually be strengths, and why its value proposition is unique among cryptocurrencies.
Bitcoin: Introduction and disillusionment
Many people first encounter cryptocurrency through bitcoin. They learn about private keys, mining, consensus mechanisms, and decentralization. They understand and appreciate the uniqueness of Satoshi’s invention, and the potentially transformative impacts of non-governmental money. It’s a fascinating discovery.
Not long after this “orange pill” phase, our new bitcoiner will inevitably encounter a fresh crop of criticism of bitcoin. These aren’t the standard “nocoiner” criticisms, but rather these are the “coiner” criticisms, and unlike many nocoiner critiques, they can’t be dismissed as uninformed. These criticisms are made by people who understand Bitcoin. They are sophisticated and persuasive. Our new bitcoiner finds them compelling. The bitcoiner’s eyes are opened to the many other exciting cryptocurrencies waiting in the wings to eat Bitcoin’s lunch. The new bitcoiner has now entered the “bitcoin is boring” phase¹.
Bitcoin is boring
The criticism usually includes many of the following arguments:
- Bitcoin’s proof of work consensus mechanism is inefficient and inferior to proof of stake
- Bitcoin is too…