Vitalik Buterin, genius and creator of Ethereum, shared his thoughts on the biggest risks for Bitcoin and cryptocurrencies in general.
In an interview with the "What Bitcoin Did" podcast, Vitalik said that he believes the main risks to the cryptocurrency markets are political and technical.
Quantum Computers and NSA
“So what I tend to worry about, I mean, is that there's always that kind of risk of a black swan from technical failure. What if the NSA comes up with a quantum computer out of nowhere and steals a bunch of coins before you can do anything about it? "
The National Security Agency (NSA) is one of the largest electronic intelligence agencies in the world. But unlike other organizations, the NSA hires the best mathematicians on the planet and invests heavily in data processing. It is so strategic to the United States government that from 1952 through the early 1990s, not even the United States Congress knew of its existence.
All these factors make the NSA an agency with a keen interest in quantum computers capable of breaking encryption of messages and even cryptocurrencies quickly.
Political risk of cryptocurrencies
However, the most practical risk is the political one. Vitalik wonders about the possibility of all governments banning bitcoin.
“There is also political failure. What if governments banned Bitcoin, confiscated mining pools, and used it to do what I call a 51% spawning field attack – repeatedly attacking the network until it becomes unviable? And meanwhile, prices are low because it is prohibited and there is a crisis of confidence? "
Although it is unlikely, given that bitcoin miners are spread over a large territory and are even separated by different jurisdictions, it is still a risk.
Ethereum, the biggest risk for Bitcoin?
Commenting on the btc, Vitalik believes that the risk of apathy towards the major cryptocurrency is real.
“Bitcoin does not have what I call the escape velocity of functionality. So basically it has enough functionality to serve as a reliable base coat for many different applications. As a result, there is the possibility that, over time, people will find Bitcoin less and less interesting and other platforms more interesting.
This movement of loss of interest in bitcoin occurred in 2017, in the boom of ICOs, when Ethereum took the initiative in creating tokens in blockchain. Previously, Bitcoin was the most important option to create these tokens. However, with the dummy block limitation at 1MB, the companies and organizations that made this service left the market due to the high fees and the developers turned to Ethereum.
Speaking of Ethereum, Vitalik sees his blockchain as one of the biggest competitors to bitcoin in proposing to also be digital money and / or a store of value.
“The word money combines many different concepts. For example, people talk about unit of account, means of exchange, store of value. Per unit of account, ETH is not that, and neither is BTC. Through the exchange, Bitcoin is used like this and ETH is sometimes used like … ETH has a store of value. This is definitely something people use ETH for. "