Circle CEO: Bitcoin is still in its early stages of development and it is impossible for everyone to use it in the next 5 or 10 years

According to The Economist, blockchain technology was the subject of conversation at the Finance Disrupted event held in New York last month. During the Blockchain vs blockchain panel discussion at the event, attendees explored the current state of blockchain technology and whether currently available options such as Bitcoin or Ethereum will become a solution that will bring huge benefits to the financial world in the next decade.

From the perspective of the Bitcoin community, the comments from Circle CEO Jeremy Allaire were perhaps of most interest, as Circle is using the Bitcoin blockchain for its own payments app. Allaire briefly discussed the benefits of open networks like Bitcoin, before going on to claim that the future open standard for global network value transfer may not have been created yet.

We are still in the early stages

Overall, Circle’s view seems to be that blockchain technology is still in its very early stages of development, so there’s no reason to rely on any particular implementation.

“Our view is that we’re still in the early stages of this technology. In five or 10 years, we’re not going to all be using Bitcoin. Just like how many of us are using NCSA Mosaic or Netscape Navigator today?”

In the past, many people have assumed that something better than Bitcoin will emerge to replace the world's first and most popular public blockchain. However, Bitcoin supporters claim that the Bitcoin blockchain's special network effects and first-mover advantage are unlikely to make this happen. Bitcoin blockchain supporters are very optimistic about the ability of this peer-to-peer digital cash system to absorb new and useful functions.

According to Allaire, the lack of a standards body, such as the W3C for the web, is an issue that needs to be addressed before public blockchains gain greater use.

“We need a model that is equivalent to the W3C for value exchange, and currently that doesn’t exist. We already have a highly isolated group of Bitcoin Core developers, and a benevolent dictator focused on Ethereum.”

Allaire also pointed out during the discussion that it is not clear what the best option for a public blockchain is, and that there are not many active use cases for blockchain at present. He pointed out:

“Real use cases for blockchain, other than speculation, are very rare.”

R3 co-founder and COO Todd McDonald agreed with Allaire’s statement, saying that it is not clear what a widely used blockchain will look like in the next five to ten years. He said:

“As Jeremy said, I don’t think we’re ready to point to who the blockchain winners are.”

Ethereum’s Benevolent Dictator

After pointing out that Ethereum founder Vitalik Buterin is a benevolent dictator, Allaire went on to compare Buterin to Linus Torvalds, the inventor of the Linux kernel.

Allaire noted:

“This doesn’t feel like a good open-source global agreement process or standards body for value exchange.”

McDonald also agreed with Allaire's assessment of Buterin, who he described as a "powerful dictator" of Ethereum. He claimed that Ethereum is supposed to be a world computer that cannot be stopped, "unless Buterin says to stop and roll back."

Allaire also discussed Ethereum’s ambition to become a general-purpose computing engine. In his opinion, this will make Ethereum a more difficult technology to implement. Allaire said:

“This will make Ethereum harder to scale and harder to secure. It’s too early to know whether this experiment will scale and maintain its security, but I think it’s an important innovation.”

One of the most notable ideas Allaire brought up during the panel was that something had to be done with Zcash, which is intended to be a more private and anonymous cryptocurrency (compared to Bitcoin). Allaire admitted that he has a ‘fairly negative attitude’ towards Zcash because he doesn’t think it’s suitable for mainstream economic adoption.

“If you’re a gambler, a tax evader, etc., then Zcash is useful for you, but if you actually want to do something that increases utility for consumers and businesses and something that focuses on making economic systems more efficient and productive, then you need a different design than just avoiding taxes and government regulation.”

On the other hand, those who found Bitcoin’s usefulness in avoiding government regulation and saw it as a key attribute are what initially gave value to the Bitcoin system.

The current bitcoin development community is very interested in adding more privacy-enhancing features to the digital cash system as quickly as possible, so this may be why Allaire made some dismissive statements about bitcoin’s future.