Fidelity Discusses Future of Crypto Ecosystem — Says Bitcoin Is ‘a Superior Form of Money’
Fidelity Digital Assets has launched a report explaining why bitcoin is a superior type of cash. The report discusses the way forward for the digital asset ecosystem and compares bitcoin to newer and smaller cryptocurrencies.
Fidelity Says ‘Bitcoin First’
Fidelity Digital Assets, a subsidiary of Fidelity Investments, printed a report this week titled “Bitcoin First: Why traders want to think about bitcoin individually from different digital property.”
The report addresses some considerations traders have together with whether or not bitcoin “could also be weak to revolutionary destruction from opponents (such because the story of Myspace and Facebook)” or whether or not the cryptocurrency “presents the identical potential reward or upside as a few of the newer and smaller digital property.”
Report authors Chris Kuiper and Jack Neureuter defined:
Traditional traders sometimes apply a know-how investing framework to bitcoin, resulting in the conclusion bitcoin as a first-mover know-how will simply be supplanted by a superior one or have decrease returns.
They famous, “Bitcoin is at present essentially the most safe and decentralized community however, on the base or native community layer, it isn’t essentially the most scalable.” This has led to a growth within the digital asset ecosystem, they continued.
The report proceeds to debate two dominant narratives for envisioning the way forward for the digital asset ecosystem.
The first is “a multi-chain world.” The authors described: “In a world of a number of profitable chains, it nonetheless seems that Bitcoin is probably going the very best outfitted to satisfy the position of the ecosystem’s non-sovereign financial good with comparatively much less competitors than different digital property trying to satisfy different use instances.”
The second is “a winner-take-all or most world” narrative. The report particulars: “Given that Bitcoin is arguably essentially the most decentralized and immutable blockchain in existence, it seems as a first-rate candidate to be certainly one of, or even perhaps the only winner if this case have been to play out.”
After discussing varied points of Bitcoin, together with the Bitcoin community, “its enforceable shortage,” the Lindy Effect, the blocksize battle, the Lightning Network, and Ethereum, the authors wrote:
Bitcoin’s first technological breakthrough was not as a superior cost know-how however as a superior type of cash. As a financial good, bitcoin is exclusive.
“Therefore, not solely can we consider traders ought to take into account bitcoin first to be able to perceive digital property, however that bitcoin needs to be thought-about first and separate from all different digital property which have come after it,” the Fidelity report concludes.
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