Bitcoin vs. Competitor: Who is the future of cryptocurrency?

It is no secret that most mainstream economists do not evaluate cryptocurrencies very high.

Other cryptocurrencies such as Bitcoin and Ethereum not only created “the biggest bubble in history,” but they were “neither a formal payment method nor a good way to store funds.”

Bank of America and Dr. Nouriel Roubini think so.

However, although traditional financial experts spend a lot of time complaining about the volatility of cryptocurrencies, which makes them impossible to use as real money, in fact people can use them as currency in various places. It comes to buy pizza, shoes and more.

But which cryptocurrency is the most useful? Ok, maybe not surprisingly, the answer is bitcoin, simply because it is more widely accepted as a means of payment than any other cryptocurrency. But as the analysis shows, other currencies are increasingly being accepted by retailers and companies. Given their superior scalability, they may eventually overtake in the coming months and years. Bitcoin.

What are the companies that accept bitcoin payments?

Although there is no authoritative list of companies in the world that accept cryptocurrencies as a means of payment, there are still many integrators and websites that list companies that accept cryptocurrencies. Perhaps the most helpful is Virtual Coin Squad, because its list lists all companies that accept cryptocurrencies. Therefore, it provides a clear perspective on which cryptocurrency is most widely accepted as a means of payment.

According to Virtual Coin Squad, there are currently 54 large companies accepting cryptocurrencies (although the actual numbers are much higher), and only two of them – MazeFit and Shiny Leaf do not accept bitcoin. The other 53 companies, including Microsoft, Expedia, Mozilla and Shopify, all accept Bitcoin; while 25 accept Litecoin; 13 accept Ethereum; 14 accept Bitcoin cash; 12 accept Monroe; 15 accept Dog currency. In other words, Bitcoin is the most useful cryptocurrency as a payment method. The reason is simple. Any merchant that accepts cryptocurrencies almost accepts bitcoin, and other cryptocurrencies are hard to say.

Of course, this list is not exhaustive, but there are plenty of other resources to confirm this. UseBitcoin is a directory of more than 5,000 businesses and retailers that accept bitcoin (and other currencies). Although it is not possible to see which merchants accept which cryptocurrency in their table, it also reveals the same reason. : Almost all companies that accept cryptocurrencies accept bitcoin, but most of them do not accept other cryptocurrencies.

The same is true of the information provided by Coinmap, which users can use to search the world map for companies that accept cryptocurrencies. For example, a search for New York City shows that there are 136 such businesses in the downtown area (the intersection of Manhattan and Brooklyn). Many of these companies only accept bitcoin, such as Tony Deli, Big Boy Deli and G Line Deli in Brooklyn, all of which have their own bitcoin ATMs.

It is undeniable that more and more companies around the world are not only accepting bitcoin, as Bach Nguyen, a community manager at SatoshiLabs (running the Coinmap website in Prague) explained to Cointelegraph:

“If I can speak on behalf of Prague and the Czech Republic, then we have witnessed an increase in the acceptance of cryptocurrencies. The area that previously accepted Bitcoin has begun accepting Litecoin or Ethereum. There are even ATMs that offer bitcoin cash. But despite As such, Bitcoin still dominates, and it is the first cryptocurrency to be realized.”

The increase in the acceptance rate of the competition currency not only proves that the public is becoming more and more familiar with the cryptocurrency, but also causes a large number of cryptocurrency payment services customized for enterprises. For example, Coinbase Commerce, launched in February this year, allows merchants to accept payments in multiple digital currencies. However, in most cases, merchants that accept multiple cryptocurrency payments are still a minority. This again shows that if you want to pay in this world with only one cryptocurrency, your best bet is bitcoin.

Coinbase Commerce that supports multiple cryptocurrencies (Ethereum, Bitcoin, Litecoin, Bitcoin Cash).

Cross-border payment and payment of taxes

There are other less straightforward evidence that bitcoin is more popular than other cryptocurrencies. For example, in April 2017, the University of Cambridge released a global cryptocurrency benchmark study, which for the first time systematically studied alternative payment systems. Although it doesn’t focus only on consumer payments to companies, it finds that 86% of companies that use cryptocurrencies pay Bitcoin as their primary cross-border payment method.

Such payments cover a variety of uses, from international remittances to business-to-business payments and merchant services, so there is no direct evidence that Bitcoin is accepted by 86% of companies that allow customers to pay in cryptocurrencies. Despite this, they still point out that Bitcoin is the most commonly used cryptocurrency for payments, which in turn suggests that anyone who wants to buy cryptocurrency is advised to hold some bitcoin because the environment is more suitable for paying with Bitcoin. And not any other digital currency.

But this situation will not last long. In addition to the increasingly popular cryptocurrency payment services, various countries have taken measures that will promote the more common use of cryptocurrencies for payment. In South Korea, Bitumum, the country’s largest exchange, has been building partnerships with many online platforms, including WeMakePrice and Yeogi Eottae. Under the terms of its agreement, the platform will be able to accept payments in multiple currencies (including Bitcoin, Ethereum, Ripple, Bitcoin cash and ICON, etc.), and Bithumb is also working to promote such agreements in other parts of Korea.

A few states in the United States are also considering passing legislation that allows citizens to pay taxes and license fees in cryptocurrencies. In May of this year, Arizona passed a bill requiring “to study whether taxpayers can pay taxpayers’ income tax liabilities by using payment gateways (such as Bitcoin, Litecoin or any other cryptocurrency).” In late February and In April, Georgia and Illinois also introduced a very similar bill. Although neither of these bills passed, their acceptance of cryptocurrency will greatly promote cryptocurrency (not just bitcoin) as a means of payment.

Bitcoin’s challenger

Although Bitcoin is far ahead of the number of merchant acceptances, it does not necessarily make it the most “useful” cryptocurrency, at least when considering its inherent technical characteristics.

For its scalability issues, effective solutions have not yet emerged since the bitcoin trading congestion in 2017. Forgot to upgrade its lightning network. The Lightning Network was only launched on the test network and has not been widely used. The Bitcoin network can handle up to seven transactions per second, still far behind Visa’s maximum trading speed of 24,000 per second. This prompted the Bank for International Settlements (BIS) to publish a related report that concluded that cryptocurrencies (especially cryptocurrencies such as Bitcoin using a workload-proven consensus mechanism) are not scalable enough to be global Acting as a currency in the economic system.

Therefore, there is no guarantee that Bitcoin will be adopted on a large scale, and there is no guarantee that its competitors will not surpass it to become the most practical cryptocurrency at a certain moment. For example, Bitcoin Cash, which is a bitcoin forked coin with a 32MB block capacity that developers split from the Bitcoin main blockchain on August 1, 2017. Bitcoin has a block capacity of 1MB, Bitcoin cash is 32 times larger than Bitcoin’s block capacity, and can process up to 224 transactions per second.

Roger Ver, an entrepreneur and Bitcoin cash supporter, expressed his excellent trading speed in April this year:

“Bitcoin Core is being rejected by merchants around the world. Bitcoin cash is being actively accepted by merchants around the world.”

However, Bitcoin cash itself has some drawbacks. For example, its transaction fees are not always lower than Bitcoin, and it is not the only competitor that prevents Bitcoin from becoming the primary cryptocurrency payment method. For example, Ripple’s consensus mechanism does not require mining, and it can process up to 50,000 transactions per second. The Litecoin (the bitcoin core fork) has a shorter block time and faster transaction processing speed than Bitcoin. Similarly, in May this year, Ethereum also released a new version of its consensus mechanism to turn to the PoS Equity Proof, which may significantly increase its scalability and transaction processing speed.

Steady growth in usage

Although the above suggests that other cryptocurrencies may be the key to the future, this does not necessarily change the prevailing view of famous critics that bitcoin and its competitors are not “real currencies”. For example, in a well-known blog post on a degraded blockchain, Kai Stinchcombe wrote, “The number of retailers accepting cryptocurrencies as a form of payment is decreasing,” according to a Morgan Stanley report. With a partial conclusion, the report found that among the top 500 “top online merchants”, between 2016 and 2017, the number of merchants receiving bitcoin payments was reduced from five to three.

However, Bach Nguyen of SatoshiLabs told Cointelegraph that the number is actually increasing overall. “A year ago, 9085 merchants were registered (using Coinmap),” he said. “And now there are 12,801 registered.”

This is equivalent to an increase of 3,716 merchants in a year, and compared with the number of companies in the world, these 12,801 may be just a drop in the ocean, indicating that regardless of the status of cryptocurrencies in the eyes of legal or financial experts, it is being The real currency is in use and is being used more and more.

The widespread adoption of cryptocurrencies as a form of payment still has to wait for many years, although some analysts believe that this is only a matter of time.

Mati Greenspan, an analyst at EToro crypto, told Cointelegraph:

“This is inevitable. It has been adopted in some parts of the world. The economy tends to experience periods of prosperity and hardship. As long as the economy is stable, there is no need for an independent currency. But where the government and banks have low trust. The cryptocurrency tends to prosper.”

For example, the Turkish Lira’s inflation rate has reached double digits this year, and Turkey has more cryptocurrencies than any other big European country. This means that cryptocurrencies have a rare opportunity to succeed at the expense of incompetent government. Although their scalability issues indicate that they are not fully prepared to take advantage of the opportunities now, their early application in the payments field has laid a solid foundation for their future development.

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