In late 2017 when bitcoin was at a peak, I bought £20 worth. Not to become rich, but to uniquely understand the cryptocurrency phenomenon.
My mantra is “get digital you need to be digital”. For this reason, I play with every new technology and I believe that all business leaders should too.
Like many readers, I have been watching the rise (and fall) of Bitcoin recently and wondered what all the fuss was about.
When a new technology appears so frequently in the national newspapers, you know you’re in a bubble.
To understand more about blockchain, ethereum and bitcoin, I have been reading widely and also asking experts in their field about the technology and also the business application of each.
Recently at Christmas drinks with Monty Mountford, I sat next to Jake Scott who has been playing with cryptocurrency for a while. I asked him all the questions I could, and he was able to provide some great insights into the cryptocurrency world.
To this end, when the following tweet was shown at an event late last year at DLA Piper on Bitcoin, I took the advice tweeted by Anthony Pompliano, shared at the event.
Suggestions to those new to crypto:
1. Read original Bitcoin white paper
2. Find engineers to answer Qs
3. Watch a transaction settle
4. Research token tech then buy
5. Don’t trade like “investment”
6. Understand this is new asset class
7. Remember we’re in 1st inning
8. Breathe— Pomp 🌪 (@APompliano) December 10, 2017
I bought £20 worth of Bitcoin and £20 worth of Etherum on Friday 22nd December 2017 via Coinbase, the day that the price of many cryptocurrencies “crashed” from a high of around $19,000 the previous week. I felt that buying £20 of each currency would enable me to see what the experience of holding cryptocurrency is like, not to make a fortune.
With any new technology, I’ve always experimented to enable me to properly inform my clients on how it may help them and their business.
I joined LinkedIn in 2004, and Twitter in 2007 for the same reasons – to understand the “language” of these same mediums – the same is true with cryptocurrency.
The more I read and speak to experts, I realise bitcoin was never designed to be a global cryptocurrency. With self-imposed limits of just 21 million coins, and the limitation of just 7 transactions per second, and the need for increased levels of computer processing powers just to “mine” the currency means that it is an increasingly inefficient way to trade this currency going forward.
Bitcoin may have its limits – blockchain is the future
The Bank of England has been looking at its own cryptocurrency for a while – built using blockchain technology. The Australian Stock Exchange has decided to replace their trading platform using blockchain.
So if like me you want to understand more about cryptocurrency, buy a handful of bitcoin or ether, then watch the games as your “investment” goes up and down like a rollercoaster.