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Jerry Chan: If Bitcoin is not an effective medium of exchange, it cannot be a store of value
SBI Bits’ Jerry Chan explains how Bitcoin’s role as a medium of exchange is critical to it’s acceptance as a store of value.
Jerry Chan, chief of digital asset solutions at Tokyo-based fintech company SBI Bits, spoke at last month’s CoinGeek Conference at the Four Seasons Hotel in Hong Kong.
Chan explains the world’s transition from Fintech 1.0—the age of e-commerce and the Internet, to Fintech 2.0—the age of blockchain and bCommerce (blockchain commerce). SBI Bits has invested heavily in other tech companies throughout the years, and has played a significant role in ushering in the age of e-commerce in Japan. And Chan says SBI Bits CEO and founder Yoshitaka Kitao wants the company to continue to propel the new age of commerce, Fintech 2.0 and bCommerce.
Chan goes on to explain the money pyramid in the context of cryptocurrencies, where large transactions from corporations and governments are at the top, and micro-transactions from individuals are at the bottom. In the pyramid, transaction sizes go up as you move up the pyramid. He says that people at the bottom of the pyramid—doing several micro-transactions, should be awarded the same equal priority as those at the top. And that it is this that made them interested in Bitcoin Cash (BCH), as it is the only one that honors this equality in financial transactions.
Using the island of Yap and their system of stone money as an analogy for legacy Bitcoin’s Lightning channels, Chan explains how the transfer of ownership for something that doesn’t move is a broken model. He adds how Bitcoin as a medium of exchange is crucial to its role as a store of value, and that “a bunch of USB sticks” can become useless unless these features are fulfilled.
Watch his full presentation below.
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