With each passing day lately, the bitcoin price is setting a fresh yearly high. On Tuesday evening, the BTC price cleared $11,700 like a breeze on a cool summer day. The bulls are clearly in control as the broader crypto market attains a combined market cap of $345 billion. Bitcoin is the top dog, with its dominance expanding to some 60%, according to CoinMarketCap data. The leading coin’s share of the overall market has been increasing alongside the price as investors decide to bet on the tried-and-true cryptocurrency.
In San Francisco, the two-day Bitcoin 2019 conference is taking place through June 26. The event is featuring market leaders including billionaire venture capitalist Tim Draper. The gathering of the bitcoin bulls tends to have a positive impact on the BTC price, or at least it did during the previous bull run two years ago. The same appears to be true this time around, though the cryptocurrency market has matured significantly since then.
“What Bitcoin Did” Host Peter McCormack hosted a panel discussion on “bitcoin’s strengths and weaknesses as a payment rail.” Among the panelists included ShapeShift CEO Erik Voorhees, whose chief worry about bitcoin payments has to do with fees.
He notes that “by far…bitcoin is doing most of the payments around the world of any crypto.” As the bitcoin price rises and mainstream adoption grows, he says the “the network will get congested and fees will go up.” Voorhees explained:
“We feel when transactions are happening and fees get crazy, all sorts of problems for customers emerge, especially for people not used to understanding variable mining fees. This creates practical problems but not an existential problem for bitcoin.”*
McCormack asked Voorhees about the possibility of crypto exchanges like ShapeShift adding Lightning Network, in response to which the CEO brought it back to the fees.
“A major impediment to Lightning is current fee levels. Lightning is only better for very small transactions; anything over $100 and toward $1,000, just the normal Bitcoin network works pretty well.”
He added that fees between $3 and $5 are “not that big of a deal” for transactions of that size, adding:
“Certainly, there will come a point as the network becomes more congested that it makes sense to move engineering resources to Lightning.”
Voorhees also worries about bitcoin’s privacy, which has moved away from its roots. He notes that bitcoin relative to privacy makes sense for things such as gambling but not for “hiding from the government at all costs.” We have to wonder if John McAfee is listening. As for payments, bitcoin makes sense to send payments to a relative in a different country but not for making local purchases – at least not yet. Once people begin receiving their salaries in BTC, local payments could take off.
*Direct quotes are a rough transcription from a live-streamed event.