In 2014, the Studio Planet Money venture capitalist Ben Horowitz argued about the fate of Bitcoin with financial columnist Felix Salmona.
Ben Horowitz, invested his time in Facebook and Twitter invested $50 million in startups related to Bitcoin. He believed that Bitcoin will change the world and will fully conquer the market of online shopping.
Felix salmon, financial blogger and cryptomathic, held the opposite view. He published an essay called “the Bitcoin bubble that will surely burst.” Horowitz wrote a commentary to the essay in which the author proposed to make a bet on the future of Bitcoin.
The two forces met in the Studio of Planet Money (NPR) and made a bet of five years. The confidence of Ben Horowitz was based on the understanding that Bitcoin is a major technological achievement, due to which people will be cheaper and easier to buy and sell things through the Internet.
According to Ben, how do I shop on the Internet — basically, using credit and debit cards — is a problem for many enterprises whose business is based on such sales. First, enterprises have to pay the companies making the credit card a Commission of about 2.5% of everything they sell. For some companies it very much. In addition, according to Ben, the company issuing credit cards deny some law-abiding customers because they are considered potential fraud.
Felix was skeptical about the success of Bitcoin. In particular, he was troubled by the fact that the number of bitcoins is limited. And it should mean that over time Bitcoin will become more valuable. In other words, deflation is inevitable. The rising price of Bitcoin will make it inconvenient for shopping on the Internet.
Ben and Felix agreed to meet after the survey, which will give Planet Money an independent company to find out whether the Americans Bitcoin for online purchases. If more than 10% of respondents answered in the affirmative — Ben will win, otherwise the winner will be Felix. The stakes in this dispute have become socks from Alpaca wool, which in 2014 could be bought for bitcoins.
Planet Money recently announced the winner. According to the results of an independent survey among 900 Americans, only 3% of respondents have used the cryptocurrency for payment of online purchases in the last month. Felix salmon won the dispute and a pair of lovely socks.