IBM Will Beat Bitcoin was the actual title of an article published in Forbes. In all fairness, the author makes his arguments seem sound...on the surface. A deeper look will show that he's just spreading a common FUD about Bitcoin and the Blockchain.
First of all, how is IBM in a race or competition against Bitcoin? Is IBM a currency or are they working on a currency? Is Bitcoin a Corporation? No and No. In fact, the only similarity between IBM and Bitcoin is the blockchain, but does that make them competitors? Is everyone working on a blockchain in competition with Bitcoin? Not by a long shot.
The author goes on to state that Bitcoin will meet with opposition from established governments, banks and other cryptocurrencies, and that IBM is not facing any of this opposition. Yes, both things are true, but that’s because IBM is not a currency nor is it building any currency, which again begs the question, “Why and how are these two completely different things being compared at all?”
It’s like saying a soccer ball (european football) and an orange are both round, so they can be compared because they can both roll. Senseless.
The author of the FUD article (maybe not purposeful, but FUD nonetheless) uses blockchian as the only common ground between IBM and Bitcoin. He uses this commonality to convince the reader that the blockchain is the real innovation and that money is a stupid use for blockchain.
That is absolute bank and government FUD. They want to compete with Bitcoin by creating their own cryptocurrency, so they profoundly state, “Independent money outside of banking controls is a stupid use for the blockchain, but look, you can use it as a database!”
It’s like saying, “A car is a stupid use of the internal combustion engine, but look, the internal combustion engine can mow your lawn!”
Yes, the blockchain is a great innovation and there are many use-cases where it holds the potential to improve many things that desperately need improvement. It is important to note, however, that it does face many obstacles, not the least of which is entering the data into the blockchain.
I love the example given by Andreas Antonopolous. One use-case in development by many companies is using the blockchain to monitor temperature of sensitive pharmaceuticals while in transit. The driver of the delivery truck gets stuck in traffic and his truck is in danger of overheating, ruining the pharmaceuticals. Or the truck’s cargo air conditioner hasn’t been maintained properly and it’s not keeping up with the 100 degree (F) day in the beating sun.
The driver gets paid when the receiver accepts the shipment. If the blockchain shows that the pharma products have gone above a certain temperature, the receiver won’t accept the shipment and the delivery driver won’t get paid.
So he stops at a store, picks up a bag of ice and puts some ice on every temperature sensor attached to the blockchain. Shipment gets accepted and driver gets paid. Problem solved.
If you think that scenario is far-fetched or full of holes, look at other blockchain use cases. Put this same blockchain scenario into rural China and Russia to improve the quality of food.
People will find a way to get paid even if the quality is not up to standard. If correct data within the blockchain (database) means feeding and buying medicine for the farmer’s family, the farmer will find a way to fake the data going into the blockchain.
Amazingly, Bitcoin does not face any of these problems. By design. This is because controls have been designed into bitcoin which verify the data within the blockchain. The control is called Proof of Work (PoW). Also, the blockchain is just one of the many purposefully designed features of Bitcoin.
Stay tuned for further articles about why Bitcoin cannot be stopped.
Summary
Banks and governments spread FUD that money is a valueless use of the blockchain, but blockchain as a database is very valuable and promising.
Blockchain holds a lot of potential to solve worldwide problems that desperately need a solution, but it comes with it’s own set of obstacles and it is not the ultimate solution for every problem the world has.
Bitcoin completely undermines banks and governments and they will use all methods at their disposal to maintain their control. This is the topic of many articles to come. Stay tuned.