When the WSJ editors allow this to be published, they may as well just say “we didn’t bother to do any research, but the sentiment seems bad so let’s get something written up from a skeptic’s perspective, so we can stay relevant”.
Writing for the WSJ, Paul Vigna writes that Bitcoin is like ‘private money’ projects of the 19th century. He goes on to lump Bitcoin with all the other alt-coins, as if it’s not worth mentioning how different and unique bitcoin is, possessing properties and qualities that no other coin will ever be able to match. EVER.
Long story short: Bitcoin is NOT private money. There is nothing private about it. It is run on an open blockchain, with borderless, censorship-resistant properties, is decentralized and is secured by global consensus where everyone must play by the strict mathematical rules of the system. Anyone can join the network. Anyone can participate in development. Anyone and everyone can submit upgrade and change ideas to the network. It is a network that belongs to everyone and yet no one. Logically, one may question how such a system can operate when there is no clear leadership. The answer lies in the game theoretical reward system for miners, who confirm global transactions for a small fee, and the global network of nodes that decentralize the network. Anyone can run a bitcoin node. And although mining is expensive for the average person, there are signs of the ASIC hardware prices returning down to earth, making it possible for once again for average people to become miners.
Ultimately, there is nothing “private” about bitcoin. But the fact that the WSJ goes out of its way to wrongly characterize the nature of bitcoin, it’s no surprise that there remains A LOT of confusion, misunderstandings, and lack of proper media coverage about this technology. With the media being either willingly or unwittingly complicit in spreading false information about bitcoin, the effect is that more people become inclined to sell their holdings, many of whom got in during November and December. These new users/buyers look at the price and come across articles like this from ‘established’ voices in the finance industry and conclude that perhaps their investment is not worth holding on to any longer. The opposite is in fact the better truth: when the talking heads start tripping over each other to explain why the price of bitcoin is going down, and they do so using wrong facts and misinformed comparisons, that’s usually a ‘buy’ signal.
One last note: the writer conveniently chooses to ignore upgrades such as Segwit and Lightning Network, both of which have pretty much laid to rest the arguments about bitcoin transaction scalability. Raising a problem from the peak of transaction usage in December without mentioning the solutions that are now very much real is itself an example of shoddy journalism.