Is Bitcoin the MySpace Of Crypto?

First to market has its drawbacks

First to market has its drawbacks. If not planned properly, you can box yourself in and carry a great deal of technical debt forward. I may sound rather techie making that statement, but I’m not a coder. Not a developer. Not an engineer. I’ve certainly worked with plenty of them with ~ 15 years of experience as  product manager for two different FinTech firms so I’ve learned a thing or two. I know from experiences what kind of product design and management practices engineers loathe. They become acutely aware of what will box them in and fight to avoid that. 

All the same, it happens. I’m old enough to remember the Betamax vs. VHS battle for home video dominance. Betamax was in many ways superior but failed to win the market due to early design flaws that held it back. Remember having to get up and change the tape after one hour? Yep, you couldn’t watch a single movie straight through as the tapes only lasted 60 minutes. Worked great for recording sitcoms but movies were a big fail. 

Then there’s MySpace. I have no idea what they did wrong. It’s still kicking but I haven’t a clue what’s going on there. It faded. It has nostalgia and some people have found a use case for it so there it is...lingering in the background. I’m sure there are quite a few out there who are not aware that MySpace even exists anylonger and are frantically scanning their memory for login credentials to check what type of technical debt they left behind there. What were you doing when MySpace was hot? 

Now here’s the kicker. There’s a growing sentiment that Bitcoin may be the next Betamax or MySpace. First to market (yay!) but overcome by its challengers as it is constrained by its early ideals and technology. The crypto space is flooded with coins and protocols that have arguably superior utility. Yes, utility. You’re welcome to convince me of the use case, the utility, of bitcoin. It’s quite easy to list other coins that have clear utility and value. I’ve yet to hear a clear path of usefulness associated with BTC. 

That currency component...you know, the attribute mentioned in the first line of the white paper abstract...how’s that going? I’m sure the global central banks are very appreciative of your paving the way for their introduction of Central Bank Digital Currency (CBDC). They can now seamlessly roll out their own version of bitcoin and track every transaction ever made.

Don’t think people will want to go that route? What if the U.S. Treasury goes all-in and says hey, you want payment on your Treasury notes? Great, it’s going to be made in CBDC. Oh, you’re waiting for your Social Security check? Nope, it’s coming via CBDC. Unemployment benefits? Yep, paid in CBDC. Want to buy some milk at the market? Guess what, retail stores may only accept CBDC as the government can take out sales tax immediately. 

I have another theory on CBDC that also has to do with first to market. China is pushing their CBDC hard and has gone through at least two rounds of “giveaways” where they funded individuals with free CBDC. They’re pushing their CBDC so hard that they’re giving it away. I have a hunch that the U.S. may lean towards sitting out the Beijing Olympics. It’s thought that China will push their CBDC on all who attend the events. Want to buy a shiny pin to commemorate the event? Gotta pay with China’s CBDC. Want to buy some water at the event? Gotta pay with China’s CBDC.

This would give China a bit of a legup in getting their Renminbi/Yuan on the table as the global reserve currency. They’re inviting us all over to enjoy their games and can introduce us to their new global CBDC. 

They’re even easing that path of acceptance somewhat by opening their global markets. China has been inviting international investors and traders to participate in their markets with great vigor and sure, this looks great. These are huge markets and we all want to participate. There’s just that lingering fear of the rug being pulled. At what point do we reach critical mass and they decide to force a switch to their CBDC? 

I don’t know the answer to much of what I’ve covered here. These are just hunches and I don’t have a great deal of quantifiable data to lean on. Perhaps I’m off my rocker. IDK. I’d love to hear your thoughts.