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The MIT Technology Reviews explores three hypothetical ways that Bitcoin could be âdestroyedâ in a new article.
The MIT Technology Review has published an article today, April 24, called âLetâs Destroy Bitcoin,â detailing three ways that the cryptocurrency could be âbrought down.â
The first option, according to the article, is a government takeover of Bitcoin with the creation of a Federal Reserve-backed coin (Fedcoin):
âThe year is two-thousand-something-big, and itâs the day your taxes are due. But you donât file them. Instead an algorithm automatically makes a withdrawal from your electronic wallet, in a currency called Fedcoin.â
This new blockchain would have verified financial institutions as the authorized nodes instead of peer-to-peer networks, âbasically, trusted institutions,â Yale undergrad Sahil Gupta told the MIT Technology Review. The article notes that the Bank of Canada built a simulation of such a system on Ethereum (ETH) in 2016.
Option two is a Facebook stealth takeover of Bitcoin, which involves the social media site creating a BTC wallet for all of its users, rewarding them in the cryptocurrency for interacting with ads, and giving them an ad-free experience if they let Facebook mine on their computerâs unused power (as Salon offered earlier this year):
âIf Facebook could persuade a large enough fraction of Bitcoin users and miners to run its own proprietary version of the Bitcoin software, the company would thereafter control the rules. It could then refashion Bitcoin as a corporate version of the Fedcoin described above.â
Facebook could also take control away from Bitcoin by issuing their own cryptocurrency, just like messaging app Telegram is in the process of doing after their combined $1.7 bln Initial Coin Offerings (ICO) held earlier this year.
The third way of making Bitcoin âirrelevantâ is the creation of multiple new cryptocurrencies for every situation:
âYouâre in the checkout line at the grocery store. Inside your phoneâs digital wallet you find not only Fedcoin and FacebookCoin but also AppleCash, ToyotaCash, and a coin specific to the store youâre standing in. Thereâs also a coin redeemable for babysitting services, and another that gets you rides on your local subway system.â
This option, according to MIT Technology Review, is âalready happening,â as companies are creating their own coins or tokens to be used just for their services, like Kodakâs ICO to form a currency used to license photographs.
How Bitcoin can prevent any of these options from taking place is to capitalize on its advantages, namely that âBitcoin transactions are anonymous and impossible to censor.â
However, the article notes that the US National Security Agency (NSA) is already attempting to link peopleâs identities with their BTC addresses, according to documents leaked by Edward Snowden, and if governments âseek to create and enforce blacklists,â they could pressure the âcrucialâ BTC miners.
At the end of March, Snowden had said in an interview that Bitcoinâs Blockchain ledger was âdevastatingly publicâ and that a good alternative to fiat that cannot be controlled by the government has not yet appeared.
MIT Technology review concludes that âif cryptocurrencies are to be widely used, it will be the habits of the masses, not the wishes of Bitcoinâs early adopters, that determine what becomes of Satoshi Nakamotoâs vision.â
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