If you’ve heard about Bitcoin and you’re only somewhat (or not at all) familiar with it, chances are you’ve heard more about all the scams that are associated with Bitcoin, rather than what it actually is, or how it works.
To illustrate the point one could explain what Bitcoin is and how it works. One could talk about it’s core value proposition: The fact that it’s a sound form of money, a hedge against inflation and uncertainty, with a strictly limited and predictable supply, a decentralized asset that’s un-confiscatable, the most trustworthy form of money, free from centralized (corruptible) authority.
And while these discussions are off course very valuable, they can become quite technical. So a simpler alternative would be to draw an easy parallel.
Email has been around for decades and today it’s used by hundreds of millions of people every single day in settings ranging from governmental to business and personal. It is perhaps the most widely used form of global communication ever created.
Which is precisely why there are also many people who use email to perpetuate scams. These range from discounted Viagra to Nigerian Astronauts stuck in space. Sometimes it’s funny, but mostly spam is just annoying.
Then there’s the more sinister phishing attacks. This is where scammers send out targeted messages to try and trick the receiver into disclosing sensitive information, or download malicious programs, which can be used to steal funds.
Email is a fantastic form of communication. It’s digital and can thus travel around the world in seconds. It can accommodate various attachments and can facilitate communication between many people simultaneously. But it’s precisely because its digital that it’s also great for spam and phishing. It’s easy to simultaneously send many thousands of emails with the click of a mouse and it’s easy to trawl websites looking for publicly displayed email addresses.
The obvious question then is, if you believe Bitcoin to be a scam, why don’t you also consider email to be a scam?
Because we generally understand that there’s a clear distinction between the tool itself, and what people choose to do with it. And unfortunately there will always be those that choose to use whatever tool they can find to defraud people.
Bitcoin is not a scam. Like email, it only enables some people to scam others. And because it’s digital, it brings with it certain fantastic qualities, but these can benefit both honest and dishonest users.
The solution is not to look at Bitcoin as a scam but to identify the scammers and make it more difficult for them to do what they do.
In the early days of email spam and phishing was more of a problem than it is today. It took time for service providers like Gmail to develop filters could warn users when emails look suspicious.
Likewise, it will take time for Bitcoin to mature and for developers to create infrastructure that does not detract from the benefits of the system, but which makes it more difficult for scammers to exploit it.
These are early days for Bitcoin and calling it a scam only detracts from the wonderful opportunities that this nascent technology presents. The solution, like always, is to be vigilant and take some personal responsibility.
Compared to the plea of Nigerian Astronauts, it is, for now, only slightly more difficult to separate Bitcoin scams from legitimate use cases.