Bitcoin thought leader Joshua Henslee recently released a video explaining how nobody wants to use digital currencies for any reason other than speculation to gain more fiat. He covered the current state of affairs, how it came to be this way, and what needs to happen for things to change.
It’s all about getting more fiat right now.
Henslee begins by noting there’s speculation by some in the digital currency industry that if Bitcoin apps add other digital currencies such as Dogecoin, Solana, BCH, and others, there’s demand waiting on the sidelines with plenty of people ready to spend their coins.
Henslee thinks this is false. The only reason many people hold digital currencies is to gain more dollars, and nobody wants digital currencies for any other reason, he says. “More fiat…that’s what people want. They don’t care about using these apps,” he says, repeating a point he has made many times before.
“You can’t go viral by sticking with what you started with and adding another method of payment,” Henslee says, talking directly to app creators. He looks back to his days in the credit card industry, noting that merchants who added American Express, Diner’s Club, or Discover cards saw only minimal benefits.
Adding more digital currencies won’t help apps gain traction.
Digging deeper, Henslee reminds us that supporting different protocols in order to accept disparate digital currencies incurs technical debt, and that adds risk and costs, meaning there’s even less incentive for anyone to accept other digital currencies.
“From a business perspective, it doesn’t really make any sense,” he says.
Giving concrete examples to back up his claim that nobody wants to spend digital currencies, Henslee mentions Purse.io, a service that eventually shut down but aimed to do Amazon fulfillment to allow people to spend their digital currencies. He says how Honey Rewards on Centbee is doing the same with 5% cashback, but he wonders whether it’s sustainable in the long term. Likewise, he points to the various crypto debit cards that have failed, noting that trying to merge this (the new) with the old legacy financial stuff is asinine.
Henslee doesn’t find it a coincidence that much of the social engineering to promote Bitcoin as digital gold, or something not meant to be spent, started in and around when Microsoft, Steam, and some other large companies were about to adopt it for payments. “Obviously, they do not,” he says, highlighting how there’s been a complete regression in that regard.
Adding insult to injury, merchants who want to accept digital currencies must keep an internal ledger and account for the volatility the industry is renowned for. But this does nothing to help the cause of digital currencies as payments.
It’s all about the money.
Looking at same of the apps on BSV that people use, Henslee points out that they do so to make money. He points to Haste Arcade and CryptoFights, which give players the chance to make money. Likewise, people are interested in non-fungible tokens or NFTs and the various social media apps for the same primary reason: to make money.
While this is a frustrating situation, Henslee believes it will eventually end, and the industry can move forward. He wrote an article on how the entire space still needs to take a bath before realizing its potential.
Key takeaways from Joshua Henslee’s video
- Henslee’s key point is that nobody wants the various digital currencies for any other reason than speculation.
- Several applications exist and have existed to facilitate the adoption of digital currencies as payment methods. None of them have succeeded so far.
- The notion that Bitcoin is not for spending was deliberately disseminated and promoted right when it started to gain traction as a payment method.
- Eventually, this speculative phase will pass, and the industry will move forward to facilitate micropayments and many other new use cases.
Watch: The BSV Global Blockchain Convention panel, Blockchain for Digital Transformation of Nations
New to Bitcoin? Check out CoinGeek’s Bitcoin for Beginners section, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.