Global Data Report: Cryptocurrencies are Expensive, Slow, Unusable and Can not Scale.
A report recently published by Global Data, is trying to destroy what it considers myths and great falsehoods about the advertising that surrounds cryptocurrencies. Among its findings, the company concludes that cryptocurrencies are costly, slow, mostly can not be spent and can not scale to meet their projected demand.
Cryptocurrencies are Expensive, Slow, Unusable and Can not Scale.
The London-based research firm, founded in 2006, Global Data, published a 34-page study on why they exactly believe that crypts will never live up to their expectations or promises.
Its chief analyst, Gary Barnett, comes to the heart of the matter: “Many of the most basic claims made by cryptocurrency advocates are simply not true. They tell us that cryptocurrencies accelerate transfers, that they help eliminate intermediaries and that they are free, but none of this is true. ” Anecdotes abound about the veracity of his claim, especially in regard to the Bitcoin core (BTC), the most popular cryptocurrency in the world, and the best known. The ecosystem has chosen to use “intermediaries”, the same technical report of Satoshi Nakamoto was written to avoid it, such as banks (Coinbase) and other exchange platforms that are allowed to have full control over users’ currencies and tokens.
“Cryptocurrency transactions are not free,” continues Mr. Barnett. “For example, at its peak, the cost per transaction of bitcoin exceeded $ 50, which is not exactly a good way to buy basic products worth $ 25. While the cost per transaction is around $ 1 when the bitcoin network is not loaded, it will inevitably increase if the transaction volumes grow back. ” Also in this case, the scapegoat is BTC, and no viable alternatives are mentioned in this regard, such as bitcoin cash (BCH) or others.
Perhaps the most damning thing is to consider what ‘currency’, which is part of cryptocurrencies, means, Mr. Barnett shoots “no cryptocurrency is widely accepted and negotiated. The number of retailers and companies that accept cryptocurrencies as payment for goods and services is decreasing, and those that do usually report very low volumes of transactions in cryptocurrencies compared to other means of payment. “
This somehow raises the question, but it could require that Mr. Barnett and Global Data be a bit more modern when it comes to the most recent history of BTC in particular.
Enthusiasts have taken nuanced sides about the importance of statements like Mr. Barnett’s, and the differences are so deep in the crypto space that there are entire projects to prove that others are wrong. In addition, these are the first days with regard to the adoption by merchants, the constant harassment of the media, together with governments around the world that threaten an increasingly strict regulation, does not help at all.
The Scaling Problem Still Lurking
The Global Data hammers house a key bugaboo with respect to crypts and scaling. For the ‘big miners, this issue seems to be the most important. With the advent of bitcoin cash (BCH), the larger blocks allow more transactions, less congestion and, ultimately, lower rates and confirmations so far faster, at least in theory.
However, the report concludes that “cryptocurrencies can not scale. The Visa payment network is capable of supporting 24,000 transactions per second (tps) at maximum rates and regularly averages around 1,500 tps. Bitcoin, meanwhile, is struggling to reach a transaction rate of more than 10 tps, while bitcoin cash can handle around 60 tps. The only cryptocurrency that approaches the average of Visa is Ripple, which is capable of achieving 1,500 tps. “
And so, the main research companies, such as Global Data, can reflect on the current status of crypt valuations. As Mr. Barnett emphasizes, “they currently apply to cryptocurrencies,” “they have no basis in fact; cryptocurrencies represent a classic bubble, in which valuations are purely the result of speculation about the likely behavior of the market rather than a clear valuation of the underlying value. “
No mention is made of the fact that it has only been about a decade in reaching valuations, and how currencies like BTC (bitcoin) have gone up thousands of percent since its inception. Bubble does not yet seem to describe the prices of cryptocurrencies well.
The sole sober point of view of the report, although still immersed in the cynicism and assumptions of the mainstream, is presented as a preface. “To be fair,” the researchers point out, “all the coins are a trick of trust.
The US dollar, the pound sterling and the euro do not depend on anything other than market confidence for their value. The extent to which a currency works effectively is a function of a number of factors and this report aims to determine whether cryptocurrencies represent a serious alternative to established fiduciary currencies. “
Few defenders of cryptocurrencies would say that decentralized money is there, but, again, government money has had a huge advantage.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.