Bitcoin remains the undisputed “king” of blockchains. Bitcoin’s dominance has increased significantly since the experimental times of 2017. Bitcoin has survived many attempted forks and “civil wars” and has established itself as the reserve cryptocurrency; people fall back to Bitcoin in bear markets. The production network has stood the test of time for over 10 years now.
However, the crypto industry has dismissed Bitcoin when it comes to smart contracts or Web 3.0. I believe this is going to change.
It’s true that Bitcoin cannot do everything. Bitcoin is secure because it has a limited scripting language. Bitcoin is reliable and durable because it doesn’t change. This does not mean that the developer ecosystem around Bitcoin cannot innovate and enable support for Web 3.0. As the crypto industry makes progress toward Web 3.0, we’ll come to realize that it’s hard to beat the security and network effects of Bitcoin.
Despite several initiatives by potential competitors, the hashrate of the Bitcoin network and the security offered by its proof-of-work (PoW) mining remain unparalleled to this day. For years, new cryptocurrencies have attempted to launch their own native PoW networks; none has approached Bitcoin’s success.
Bitcoin has network effects. Most people are introduced to cryptocurrencies through Bitcoin. If something can be done on top of Bitcoin, it will eventually get done on top of Bitcoin rather than a smaller ecosystem. Network effects make Bitcoin’s success self-reinforcing: Miners see that the network is established, that the community is strong and that the currency is the “hardest” money in the crypto space. Miners join or expand their commitment, increasing hashpower and network reliability; their entry inspires still more holders and businesses, increasing community support. The cycle goes on.
Smart Contracts on Bitcoin
Despite the success of Bitcoin, critics who question Bitcoin’s capacity for innovation have some valid points. There are aspects of Bitcoin that frustrate developers who wish to explore the world of smart contracts and decentralized apps. Many projects have created their own blockchains because they perceive Bitcoin’s scripting limitations as a dealbreaker. They cannot deny the original chain’s security, but they also wish they could write more expressive smart contracts. New blockchains find themselves struggling with poor, native PoW security, and often attempt jumps to proof of stake (PoS) or delegated PoS setups which may be less secure and tend toward centralization.
As a result, several crypto projects have concluded that they must pick their poison: They must either attempt to bootstrap a native PoW chain or else establish a PoS chain, with all of the tradeoffs that entails.
But these are not the only options. There is a different path available: Smart contract platforms can employ Bitcoin’s PoW security to safeguard new blockchains.
New protocols can anchor to the security of Bitcoin and extend Bitcoin’s utility. Transactions that settle on Bitcoin are harder to reorganize than they are on any other network. This is an under-explored design space but one which is beginning to change.
The Bitcoin blockchain already has security derived from its energy expenditure and this security may be passed on to the interconnected chain by using concepts like proof-of-transfer (PoX). It’s important to recognize that interconnected chains differ from traditional sidechains; interconnected chains create their own crypto assets, but they utilize the Bitcoin chain for broadcasting mining operations and consensus steps. An interconnected chain anchored to Bitcoin is a win-win proposition for all parties as the new blockchain benefits from the reliability, and longevity of Bitcoin while providing freedom and flexibility to developers working with the interconnected chain.
The Bitcoin blockchain can also reap benefits, acquiring new and powerful use cases. These can attract new miners and new network participants, further solidifying Bitcoin’s place as the reserve cryptocurrency.
Smart contract platforms, and I include my own project, Blockstack, in this, understand how powerful on-chain contracts can be. But just as you don’t need to build all new roads to drive new cars, there’s no need to reinvent PoW or PoS chains to employ robust smart contracts or to launch new blockchains. The solid foundation we need to realize our vision for Web 3.0 is already here; a future Web 3.0 can anchor on Bitcoin.
Image credit: William Krause on Unsplash
This is an op ed contribution by Muneeb Ali. Views expressed are his own and do not necessarily reflect those of Bitcoin Magazine or BTC Inc.
The post The King of Blockchains, Bitcoin Can Become the Foundation for Web 3.0 appeared first on Bitcoin Magazine.
Bitcoin Price Prediction: BTC/USD Creeps Towards $10,600 Following Rejection at $10,847
Bitcoin (BTC) Price Prediction – September 30
The Bitcoin price is trading above $10,700 against USD and the coin is likely to climb steadily with a few downward moves.
BTC/USD Long-term Trend: Bullish (Daily Chart)
Resistance Levels: $11,600, $11,800, $12,000
Support Levels: $10,000, $9,800, $9,600
It is safe to say that Bitcoin has been turbulent in recent days, after tight trading for a few weeks with relatively low volatility. A few days ago (September 24), the Bitcoin price rose sharply by moving above the resistance levels of $10,500 and $10,700 against the US dollar. At the moment, the price is declining and is moving close to the 9-day and 21-day moving averages at $10,755.
What is the Next Direction for Bitcoin?
A crucial uptrend could probably form if the coin remains above the moving averages, with support close to $10,500 on the daily chart. However, if the decline occurs below the moving averages, the price could extend its downward correction to the lower boundary of the channel and any other loss could possibly push the price of Bitcoin to the support level of $10,200.
More so, a further sell may cause the market to reach the critical supports at $10,000, $9,800, and $9,600. In other words, if the market were to rebound, traders could see the next buying pressure towards the resistance levels of $11,600, $11,800 and $12,000 with the technical indicator RSI (14) remains below average.
BTC/USD Medium-Term Trend: Bullish (4H Chart)
Looking at the 4-hour chart, Bitcoin’s price is currently trading around $10,758 and above the 9-day moving average after a reversal from $10,681. Meanwhile, traders can see that the bullish supply is becoming steady in the market while the bears are also trying to drag the price down.
However, if the buyers can strengthen and energize the market, they can further push the price to a $10,900 resistance level. Therefore, breaking the mentioned resistance could also allow the bulls to test the $10,950 and above. Inversely, the RSI (14) is currently moving around 52-level, turning down may cause the bears to step back which could drag the price to the support level of $10,550 and below.
Bermuda grants Bittrex DABA license to commence local operations
The island nation of Bermuda is in the news today after it gave U.S-based cryptocurrency exchange, Bittrex, a Class F (“Full’’) Digital Assets Business Act license that will allow the platform to operate under the supervision of the Bermuda Monetary Authority (BMA). According to Bittrex Global CEO Tom Albright, Bittrex (Bermuda) will provide additional digital asset services like Futures, in particular, based on further approvals by the BMA.
Bermuda’s Digital Assets Business Act of 2018 (DABA) is a comprehensive regulatory framework that oversees crypto-financial services, including digital asset issuance, sale and redemption, exchange operations, and custodial services.
However, Bittrex is not the first entity to receive Bermuda’s DABA license since Circle was the first major crypto-company to receive Bermuda’s Class F DABA license. Meanwhile, the island nation had also struck a $15 million investment deal with Binance in the past. These developments are a sign of how the island nation has been keen to adopt cryptocurrency and blockchain tech over the past few months and years.
Like Bermuda, many governments across several nations have only now begun to study the use cases of cryptocurrencies and blockchain. However, Bermuda was one of the first sovereign nations to accept payments in USDC stablecoins for tax payments, fees, and other government services.
In fact, in 2019, Bermuda also announced the development of its blockchain-based digital ID system, followed by a stimulus token that allowed the distribution of financial aid to its population. The token project in question was actually accelerated after the outbreak of the COVID-19 pandemic for people in need of emergency funds.
President Maduro: Venezuela Seeks Opportunities To Use Cryptocurrency For Global Trade
- Venezuela’s cryptocurrency story continues as the country’s President Nicolas Maduro has presented new use cases.
- A recent report informed that the South American nation is studying the possibility of using digital assets in trades alongside the national Petro.
- President Maduro has presented new anti-sanctions law in the Constituent National Assembly. In a recent speech, he asserted:
“The anti-sanctions law is the first response to give new strength to the use of petro and other cryptocurrencies, national and global, in domestic and foreign trade, so that all cryptocurrencies of the world, state and private, could be used. This is an important project that is under development.”
- The news comes after Maduro suggested last year that his country could adopt cryptocurrency payments.
- Additionally, Venezuela signed a new tax agreement this summer that enabled the nation to start collecting taxes and fees in the Petro.
- A study reported by CryptoPotato revealed that digital assets already play an essential role in the country’s struggling economy. Venezuela’s intensifying financial crisis has catalyzed significant interest in cryptocurrencies as people seek opportunities to escape the devaluating national currency.
- The Bitcoin peer-to-peer volume exemplifies the growing interest in the primary cryptocurrency within the country. As per data from coin.dance, the BTC P2P volume on LocalBitcoins has been continuously surging in the past several months.
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