Tech Visionaries Predict One Global Cryptocurrency: Bitcoin

By Hal M. Bundrick Feb 2, 2015 4:38 PM EST

NEW YORK (InsideBitcoins) — Reid Hoffman can spot a technology trend. The founder of LinkedIn worked at Apple, was on the board during the funding of PayPal — and his first company, SocialNet.com, was a social network before social networks were cool. He’s invested in Facebook, Airbnb, Flickr and many others. Needless to say, his appearance at the Bitcoin & the Blockchain summit in San Francisco last week was the highlight of the event for many attendees.

ReidHoffman-500

Reid Hoffman

Appearing with Wences Casares, the co-founder and CEO of bitcoin wallet and vault Xapo, the two engaged in a wide-ranging and casual conversation that included cryptocurrencies, network effects and the price of bitcoin. Casares has an impressive resume as well, launching the first ISP in his home country of Argentina, and an online financial services portal which he sold to Banco Santander for $750 million in 2000.

The discussion began with a discussion of where bitcoin fits in the cryptocurrency scheme of things.

“You have about 90 cryptocurrencies that have some form of traction, buyers and sellers — all of those cryptocurrencies combined have about 50,000 users. Where bitcoin is at about twice that in new users a week,” Casares said. “All of the cryptocurrencies were about 50% of the volume a year ago. And today, bitcoin is more than 90% of the volume.”

That’s the network effect propelling bitcoin to dominance, both agreed. And with momentum, the price will follow. But first things first.

“It’s simple math. (The price is going up.) And going up a lot. A half million dollars, a million dollars a coin — something ridiculous like that.”

“I think it is remarkable that bitcoin is working as designed,” Casares added. “It was designed to be spread as an asset and only when it has some significant pervasiveness as an asset; it may become a payment mechanism. There are roughly 10 million people in the world who hold bitcoin; there’s less than a million people who are actively using it for payment. If you believe that we’re going to get a billion people in bitcoin — in 21 million coins — the only way, is by the price going up. It’s simple math. And going up a lot. A half million dollars, a million dollars a coin — something ridiculous like that.”

But for Hoffman the price of bitcoin is of little concern.

“The least interesting question about bitcoin is the current price,” Hoffman said flatly. “Bitcoin is designed … as an asset versus a transaction. So you actually need to get a number of wallets and you have a number of assets in those wallets — and it’s only once that becomes more universal does a transaction currency become possible. And so, actually in fact, fluctuations in price, even as dramatic as we’ve seen, actually reflects a robust ecosystem. You want to actually be stressing systems in order to have them be robust.”

But for bitcoin enthusiasts who are less patient, when will the tipping point be reached? Or, will it? Casares is willing to make a prediction – and it’s an explosion with a surprisingly short fuse.

Wences Casares

Wences Casares

Bitcoin is the “best form of money we’ve ever seen,” he said, calling it “gold 2.0.” The users that will fuel bitcoin’s breakout will total a number around 150 million users, Casares believes. “At this rate of growth we could hope to be there by sometime in 2016 or 2017.”

But Hoffman discounts the zealous devotees that believe bitcoin will outmode all currencies.

“I don’t think it will replace all of them. To me, it is 100% clear that there will be at least one global cryptocurrency. I think the likelihood is that bitcoin is that one, versus other ones, given the network effects that it’s growing. And that’s part of the reason why, in terms of investment and also in terms of developers and all kinds of things, it’s how you make that system really robust.”

And Casares thinks that waiting for a breakout moment – some triggering event that proves to be the catalyst for bitcoin’s global domination – may be misguided.

“I get questions that seem to imply that we should see some breakthrough, next month – next year. What’s going to be the killer app that we haven’t seen yet? What’s going to make bitcoin explode into the mainstream in a year? But we don’t know if these things are going to happen or not — and when. I think that what we can rely on is the same thing that we saw happen in the last five years. If we see the same thing that we saw happen — in terms of bitcoin growth and adoption — in the last five years for the next five years, that gets bitcoin mainstream and gives you many hundreds of millions people on bitcoin; even possibly close to a billion people on bitcoin.”

  • Below an image of FB, Twitter, Skype and Whatsapp users from 0 to year 4. Now, whatsapp has over 700 million users. FB has that billion already.

    Look how quickly new technologies are embraced:
    http://www.quora.com/How-many-users-does-WhatsApp-have-worldwide

    People want to be able to send money quickly and cheaply. When we figure it out in practice. Boom!

  • I would guess the killer app will come in a form of micropayments. Tipping and small money transfers through messaging apps sound something which could spread like wild fire.

  • kendreik

    it can easily be extended to 16 digits, don’t worry about it!

  • Well it only has 8 decimal points in the releases so far

  • Renioctib

    The Internet as we know it started in the late 50’s. The world wide web however, did not happen until 1980. It took over 20 years before user friendly interfaces came along for the general public.

    “That’s like saying that the invention of email reduced the web to just a postal service replacement.” No, not at all. Usenet was always available and when email came along it was only for those who needed not to think very much and have their communications routed by unknown third parties. Today, email is a cracked pot just waiting to fall over and when it does, there will be some who know where to go and what to do about it, and some who don’t.

    Bring on the Bitcoin bling by all means but to bypass the fundamentals of understanding it by clicking on a killer app just for the sake of a speedier mainstream adoption, is thoughtless. And when one is speaking of one’s own personal finances.. thoughtless, doesn’t work very well.

    Your comment was based on a killer app for the Bitcoin uneducated, just so it can go mainstream in a flash. And we all know where flash mobs come from and ultimately what happens to them.

  • Anonymouse

    They don’t have a bank account, because for that you need a bank. You don’t need a bank to use Bitcoin, you don’t even need a smartphone, you can just use a regular mobile phone. There was a service like mPesa for Bitcoin which was better than mPesa, but the cell-phone carriers dropped it, presumably motivated by mPesa somehow.

  • Of course mainstream adoption is happening, like I said very early in this thread… But that will take several years to go fully mainstream at this rate and my point here is that the right killer app will add speed to that time.

    I don’t see a killer app as something that bitcoin would be “reduced to” at all. That’s like saying that the invention of email reduced the web to just a postal service replacement.

    I expect in time for there to be Hundreds of killer apps from bitcoin. Things like new investment options that can’t exist elsewhere, machine-to-machine economies, smart-contract-operated hardware used in daily life, videogame economies, and the full takeover of the entire business world for contract stamping/sharing.

    Try explaining these concepts to granny today though; clearly a lot of work needs to be done dumbing these concepts down into simple apps before the mainstream can get them.

  • Renioctib

    Granny could have been taught to do anything. I know a grandmother who types sudo commands to turn her evening lights on and off from her laptop via an SSH. Granted that without all of the pretty and one click stuff available on the Internet, it would be a lot less appealing to many but it would still work and feed and light the world anyway.

    Mainstream Bitcoin adoption IS taking place. The rate at which it is may be slow for some but to dumb down the technology as you put it and reduce it to a killer app that takes no thought at all.. The world suffers enough as it is with their mindless following of the concept of money, and ignorance and obscurantism have never produced anything other than fools for tyranny anyway.

    Bitcoin isn’t hard to fathom well and a wallet is but a few clicks away. You get a wallet and you read some and then you click a few more buttons to buy some, and its done. And you get to actually learn something along the way. Learning takes time. And Bitcoin is worth the time.

  • That’s not how the internet did it though; in fact I can’t imagine how the internet would exist today if we didn’t have browsers and domain names… Think your granny would have looked up an IP table from a command prompt?

    The concept of money itself is too hard for most people; add an unconventional technology to that and it’s an absolute given that you have to dumb-down the tech in order for mainstream adoption to ever take place.

  • yanopolo

    So you think everyone on earth has access to:

    -technology (computer/smartphone)

    -internet access

    -money to afford risk of volatility and spend on internet currency instead of food

    -knowledge/education/time to learn about internet, technology, bitcoin etc.

    No offence but you’re delusional… Not even 7 billion people have a bank account let alone a bitcoin wallet

  • Leon G. Vandenberg

    A wallet in every phone #bitsim @bitSIMco see http://bit.ly/BNC-unbanked and http://bitSIM.co

  • This thread hurts my brain

  • how the christians did it

    i love how the people that don’t give a fuck about bitcoin are the ones giving the most fucks, trying to convince everyone to not use it. #winning

  • A Bitcoin is a term like A dollar. How do you break down a dollar? Ill give you a few mins. no, no, take your time!

  • lakawak

    I LOVE how the delusional fantasyland dwellers like you STILL think that the reason why 99.999% don’t give a f*** about bitcoin is because it is “too hard” to get them.

  • lakawak

    And guess what? 99.999% will NEVEr give a f*** about them. Just like 99.999999999% will never give a fu** about your sorry ass life

  • lakawak

    It is always funny when someone posts a comment mentioning the price of bitcoin at that moment. Because whenever someone reads the comment, it is ALWAYS lower by then.

  • lakawak

    Let’s rephrase the title a bit, shall we?

    “People with a vested interest in bitcoin are talking it up!”

  • Pintrip

    So you are saying that each person in the planet will have $1 worth of Bitcoin? O.o

  • solid12345

    Alot of alt coins will simply die off but I don’t think all will. The Lakota nation just voted to start supporting Mazacoin and I expect more sovereign tribal nations may look to them as leadership and begin embracing Maza too within the coming years, I think there is room for competing cryptocurrencies which will make a healthy economy for people to hedge and protect in various currencies as they already do now in fiat and precious metals.

  • kendreik

    Ha ha Renioctib , nothing passes your hawk eye it is so funny that Travis thinks we have to kill all humanity and leave only 21 million people so that each can have 1 Bitcoin. My friend travis Bitcoin has 8 decimals 1.99999999 and if you own 1 bitcoin today you have $250 usd in you pocket.If Bitcoin becomes Major World Currency If we divide evenly and share all 21 million Bitcoin to 7 000 000 000 people on the planet than the value of the 1 Bitcoin will rise to $333 usd as each person will own 0.003 Bitcoins.. So if you have 1000 Bitcoins you will have $333 000 usd. Off course in todays speculative capitalist market when many people are hoarding Bitcoins the speculative value of 1 Bitcoin may rise to $50 000 usd.

  • Anonymouse

    Damn straight; the nature of Bitcoin makes it possible for everyone on the planet to make use of it, that’s currently 7 billion people.

  • yanopolo

    “If you believe that we’re going to get a billion people in bitcoin — in 21 million coins — the only way, is by the price going up.”

    1 billion people?!!!?! this guy is crazy

  • Renioctib

    Certainly you win then on this linguistic technicality relating to plurals. Congratulations. And thus the statement might be revised to read: A wallet in every home. Bitcoin in every wallet.

  • Sam Walker

    Then you should likewise revise with your English teacher on the meaning of the article in the phrase ‘a bitcoin’. I thnk you will be similarly surprised.

  • Renioctib

    It is totally possible Travis. See your math teacher and ask them about number division. And make sure you have your jaw clamped shut as you listen, lest it hit the floor.

  • Renioctib

    If I had the choice of the two I would rather do without the app trick and see Bitcoin rise for its own meritable worth as it stands.

    Building a one click door for the Bitcoin uneducated could spell trouble. Slowly and surely, and with a doable learning curve that is necessary for this new age of BTC finance, will better serve us all in the long term.

  • Not possible unless you decimate the population. There will only be 21M bitcoin ever in existence.

  • DCmehome

    `*O*`/

    Meeewwwwnnn?!? Please?
    Breakout in moon moment. Haz cheezburger or sammich, den!

  • I’m most encouraged by the fact that it can be either or both… A killer app might do the trick if it comes soon; but if not then we’ve still got a sure thing here in time.

  • Jabber0ne

    A wallet in every home. A bitcoin in every wallet.

  • Renioctib

    “And Casares thinks that waiting for a breakout moment – some triggering event that proves to be the catalyst for bitcoin’s global domination – may be misguided.” And he is right of course.

    But then (DR) I have already said as such.. “And like a slow evening tide it will rise..”

Read more:
deepak_kraken_bitcoinist.jpg
Kraken Appoints Howard Bernstein, the Ex-CCO of Meeriman Capital as New Chief Compliance Officer

Taking a proactive approach, Kraken has appointed Howard Bernstein, the ex-CCO of Meeriman Capital as the new Chief Compliance Officer....

Close