Week 7: Bitcoin

My prior understanding of bitcoin was admittedly limited, yet I had not realized this form of currency had missed its peak, according to Greenfield, at least.  Greenfield compiles an especially convincing list of issues with bitcoin.  Among the more interesting issues, he claims the transactions take too long (up to an hour); it’s limited in the ways it can be used for a large purchase, say a plane ticket; there’s too many choices/options for a novice user; it requires a new address for each purchase; and it’s not as anonymous as it would like people to believe.  More practical issues include a lack of BTC ATMs. Additionally, bitcoin transactions peaked at 3 per second, coming in after 112 transactions/second from PayPal and upward of 3,000 transactions/second from Visa (Greenfield 136).

However, with all of those issues exposed, Greenfield suggests the biggest obstacle is the 51% attack (139).  Essentially, any group controlling 51% of the network’s processing power, they could control the actual ledger.  This sounds like the plot of a bad ’80s movie, where the yuppies steal a company out from under someone by this type of loophole.  This 51% rule of controlling a company is a common trope in pop culture (shows: Arrested Development, Silicon Valley; movies: Mr. Deeds).

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