What is it that makes Bitcoin coming back again and again, stronger after every set-back? And what is it that makes such a large number of critics angrily claiming that it is all a hoax?
One reason is that there are many who believe in the idea. As long as they continue to invest in it, it grows. But that's not the root cause, it's an effect. In the example of a company that had attempted such a project, I do not think there would have been many followers, much less investors.
The idea of Bitcoin is built upon an invention on how to implement a public distributed ledger. I think the key factor in it all is that Bitcoin is open source. This has some interesting implications, and leads to some mechanisms not generally recognized by critics.
- The implementation is available for anyone to see. That means you can, if you want, look for weaknesses in the encryption. No one can claim that NSA added back doors. This is a vital aspect if the algorithm is going to be accepted by major investors.
- There can't be a hidden agenda. Even if it would have been Usama Bin Laden that was the man behind Satoshi Nakamoto, you can trust Bitcoin.
- Regardless of set-backs, as long as there are people believing in Bitcoin, the project will continue to improve.
There are arguments being repeated by critics why Bitcoin will fail. The effect of Bitcoin being deflationary is a common one. Users and developers of Bitcoin don't care about that. It may actually be the opposite. Classically trained economists can say whatever they think about deflationary currencies, but it is not going to have an effect on the Bitcoin success.
An issue commonly referred to is that Bitcoin will take the power to control the money away from governments. This will make it harder for them to manage debts. Again, this has no direct effects on Bitcoin. Governments will have to find new ways to manage debts. Maybe, they actually have to have a better control of the cause of the debts, stopping the situation before it is going too far.
Linux was one of the first Open Source projects that changed the world, even though people in general doesn't know it. It was done through the Android operating system.
I think Bitcoin is going to be the next Open Source project that will change the world, with even bigger ramifications.
