Ari Paul: “2019 … the year of bankcoins”; Why this will benefit Bitcoin

By March 4, 2019Bitcoin Business
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Ari Paul: 2019 ... the year of bankcoins; Why this will benefit Bitcoin

In his latest Tweetstorm, Ari Paul, CEO of Blocktower capital – a crypto hedge fund – relayed his thoughts on the upcoming crypto trend of 2019: permissioned blockchains or bankcoins.

Kicking off the thread, Paul cites the incipient JPMcoin, and the upcoming facebook crypto venture: Facebook coin (or Zuckbucks, whatever…)

Read more: Facebook coin? Zuckbucks?: 10 potential names for a Facebook cryptocurrency

Paul calls these projects “inherently uninteresting to those of us interested in censorship resistance” but quickly caveats to add that these are, in fact, “awesome for Bitcoin”.

Paul theorizes that these ventures will increase interest worldwide; continuing to use carpet stores as an allegory…

3/ But....it's awesome for Bitcoin and other decentralized permissionless cryptocurrencies. Things like Facebookcoin increase global interest dramatically. Consider how carpet stores in NYC are all located right next to each other. They're not hurt by competition, they benefit.

— Ari Paul (@AriDavidPaul) March 1, 2019

Elaborating on this theory, Paul hypothesises mainstream adoption of Facebook coin, adding that inevitability this will act as a gateway to Bitcoin discovery and usage:

4/ Let's say 300 million people adopt facebookcoin, and 1 in 10 of those stumbles across bitcoin as they explore it. That doubles the number of bitcoin users, increasing the pace of adoption, the network effects, and the value of the bitcoin network.

— Ari Paul (@AriDavidPaul) March 1, 2019

Paul also asserts that an ecosystem fostered by Facebook Coin could provide an infrastructure in which Bitcoin and other permissionless crytpocurrencies could participate:

5/ And things like facebookcoin will produce a whole ecosystem of services and infrastructure around it, much of which will be able to be used directly or indirectly by permissionless cryptocurrencies.

— Ari Paul (@AriDavidPaul) March 1, 2019

The idea of Facebook Coin overtaking Bitcoin isn’t necessarily a pleasing thought to many. However, Facebook’s platform as one of the biggest and most widely used social media in the world means that once people are invested and interested thanks to the integrated use of cryptocurrencies on Facebook.

Inevitably the tide will turn to the many benefits of Bitcoin (and other cryptocurrencies) over permissioned blockchains; meaning that ventures such as JPMCoin and Facebook Coin, not only act as a catalyst for adoption, and legitimacy, but also as a allow for permissionless blockchains to reach critical mass.

9/ it's way easier to point out critical flaws in a well followed things and why there's a great alternative, than to generate interest from scratch.

— Ari Paul (@AriDavidPaul) March 1, 2019

Read more: Ex-Facebook developer: 'Ripple is centralized, FB going to eat their lunch';

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