Swedish pop-star turned philosopher: “Bitcoin is a bubble that will ruin millions of small savers”

Philosopher and former pop-star Alexander Bard has been right before when making predictions on the future of capitalism. This time he sees a paralyzed bitcoin community and worries about the prospects of millions of savers “who stand to lose everything when the bitcoin bubble bursts”.

The sudden surge in popularity of bitcoin, the world’s first and biggest cryptocurrency, has been nothing short of spectacular. In the last five years, its value has spiked a whopping 15,400 percent. This has no doubt made some investors rich, including programming expert Alexander Bottema, who told his story to VA Finans recently.

On the other hand, the warning bells are tolling. Among the sceptics is the Swedish philosopher and futurologist (and earlier synth player in the band Army of Lovers) Alexander Bard.

“Bitcoin has developed into a classic tulip bubble. The price has been pushed up by hoards of Chinese and Japanese small investors who have bought bitcoin with borrowed money at low rents. It’s clear that the currency is now very unstable and could crash soon,” he says to VA Finans.

“The Chinese market is super sensitive for crashes, and the question is how we will be able to handle millions of small savers in Japan and China, who have had their assets wiped out.”

Bard thinks the bitcoin community needs to get its “shit together”, and that there are two big problems.

One of them is slow transaction processing speeds: “Bitcoin can only manage seven transactions per second, which is way, way too slow if [the currency] is ever to have a decisive influence.”

The other in is the community’ inability to make decisions.

Not surprisingly, Bard is certain there will be many booms and busts in various cryptocurrencies, and warns people from relying on them for things like pensions and savings for grandchildren.

Despite all the gloomy predictions, Bard sees long-term potential in cryptocurrencies, and thinks that their underlying technology, the blockchain, could revolutionize just about everything

“We have built our entire civilization on contracts. That was the first thing we did when we discovered writing. To suddenly be able to create safe contracts with thousands of strangers, and trust them – that could change everything.” 

Read the original article on VA Finans.