Friday 11 May 2018

There is more demand for peer-to-peer cash than digital gold – Vinny Lingham

There is more demand for peer-to-peer cash than digital gold – Vinny Lingham

There is more demand for peer-to-peer cash than digital gold – Vinny Lingham

Civic CEO and "Bitcoin Oracle" Vinny Lingham has weighed in on the Bitcoin versus Bitcoin Cash debate in an interview with MyBroadband.

Lingham has been involved in the cryptocurrency industry for years, and describes himself as an active investor focused on blockchain technology projects.

Lingham's Civic is an identity verification project which allows users to prove their identity with blockchain technology.

"Old" Bitcoin vs Bitcoin

The debate between Bitcoin and Bitcoin Cash advocates has raged since the inception of the "Cash" cryptocurrency during a hard fork in 2017.

Proponents of both coins laud their cryptocurrency as "the one true Bitcoin", often pointing out the limitations of the opposing technology to substantiate their claims.

One of the major differences between the two blockchains is their approach towards scaling.

While Bitcoin opts to implement Segregated Witness and second-layer scaling solutions like the Lightning Network, Bitcoin Cash relies on increased block sizes.

Currently, Bitcoin Cash is a lot cheaper to transfer and use, while Bitcoin is perceived to be more stable and widespread.

"At the moment, Bitcoin and Bitcoin Cash are focusing on two completely different markets," Lingham told MyBroadband.

"Bitcoin Cash is most commonly used for fast payments, as a medium of exchange, and Bitcoin is the better suited for store of value, in my opinion," he said.

"When I look at it from the product standpoint, I think the greater demand is for peer-to-peer cash than for digital gold, given the size and velocity of the markets."

He said there is still uncertainty about the potential adoption of Bitcoin Cash, however.

"It remains to be seen if the network effect around Bitcoin Cash can grow faster than Bitcoin's," said Lingham.

"The question is: Can Bitcoin Cash catch up to Bitcoin if it focuses just on payments?"

Crypto vs cash

Bitcoin Cash is designed to function as a substitute, and possible replacement, for cash – offering fungibility and security.

While cryptocurrencies have steadily gained the attention of mainstream consumers, Lingham said there is a long way to go before they could replace cash as a medium of exchange.

He said what we are seeing now is the beginning of a token economy.

"Blockchain technologies are changing the way the world functions, and I believe this is just the beginning of the token economy," said Lingham.

"The primary value of the token infrastructure will be related to the adoption of the infrastructure, the cost of transactions and network security," he said.

"It will not be pegged to the value of the underlying assets on that network, but rather the activity levels for trading those assets."

He predicted the demand for Ethereum and Bitcoin would rise on fiat-to-crypto exchanges in the short term, leading to possible widespread adoption and utilisation of the technology in mainstream applications.

"Given that these token assets can typically only be purchased on exchanges that accept cryptocurrencies like Bitcoin, the demand for Bitcoin and Ethereum will rise at the fiat onramps," said Lingham.

"However, once the token economy grows and becomes more mainstream, it's not far-fetched to believe that you could one day buy a CoffeeCoin, blockchain-based stock, or Civic token directly via your bank or brokerage account."