Bitcoin has just gone up to $2,000 per bitcoin, the all-time high
In this video, I interviewed my fellow world-traveling amigo Joby Weeks-
an entrepreneur, activist, and bitcoin miner.
Joby is an integral part of a mining club called BitClub-
one of the top 10 bitcoin miners in the world.
We discuss the price of BTC, some of the possible pitfalls, and an important lesson about how to avoid losing money to hackers.
I asked Joby how the price climbed so high.
He answered "Scarcity.. you can’t just print BTC out of thin air.. it’s a deflationary currency, so over time with the supply going down and the demand going up- the price goes up."
A lot of people are really excited about bitcoin and the blockchain in general for different reasons, but most often because it's outside of the banks.. over a billion dollars is transacted in BTC daily. Joby and his wife have traveled to hundreds of different cities a year in the past few years- in over 120 different countries total, and everywhere they go they use bitcoin.
There's a ton of skepticism about Bitcoin- especially now, at an all-time high. People are saying that the transaction cost and the blockchain size are going to be a hindrance. They're also talking about the possibility of quantum computing making bitcoin irrelevant.
Joby responds that the truth comes in 3 phases, first people laugh or don't believe you, then it’s violently opposed, and then it’s self-evident. We’re still in the laughing stage right now he said. The entire BTC global economy is only a 25 billon market cap.
Some hedge fund managers run more than 25 billion. Bankers are moving around 8 trillion dollars a day! This dwarfs huge industries like oil and pharmaceuticals, which both are said to top only 1 trillion. But Bitcoin is currently sneaking up on Western Union, PayPal, MoneyGram, and Venmo.
One thing merchants like about BTC is there are no chargebacks, which means a lot less charges and fraud to deal with. On the flip side of this, no chargebacks also means that transactions are bundled into a block and loaded into the blockchain.
When the block is loaded, it can only hold 1MB of transactions, about 2300 transactions every 10 minutes (around 7 transactions per second).. If there are millions of people using bitcoin those transactions will get backlogged.
How Bitcoin transactions work..
Full Infographic--> goo.gl/CyOXmd
Bitcoin miners are creating new bitcoins, and the fees they charge to mine them are going up.. which is good for the miners, but for small transactions like micropayments, it makes less sense to use BTC because the fees are higher. So people are moving to other cryptocurrencies like Etherium, Dash, Zcash, Monero, etc.
The bitcoin community is split in half on what do to about the growing problem. Joby says a consensus needs to be reached. Will they ‘hard fork’ and agree to expand the 1mb block to an 8mb block? Or is there a better solution?
This debate is the focus of ‘Consensus 2017’- starting today in NYC.
Consensus 2017 includes a hackathon, a pitch competition & more.
The two main options being considered: SegWit VS Bitcoin Unlimited
Learn more about bitcoin segwit vs Bitcoin Unlimited debate here, and here.
Joby was the target of hackers who found a weakness through his T-Mobile account, allowing them to port his mobile phone number. This give them access to his Facebook, Gmail, AOL, and one of his trading platforms. He was locked out of all his accounts, and had over 125 bitcoins and other cryptocurrencies stolen.
Joby's gives some easy tips on keeping your accounts safe and other insights during our interview.
You can learn more about Bitclub here
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