Alex Fauvel, analyst for CyberCapital BV, discusses with CoinGeek’s Becky Liggero the advantages of cryptocurrencies, specifically Bitcoin Cash (BCH), compared to central bank-issued fiat notes.
Alex Fauvel, who has served as analyst for CyberCapital BV, is also a partner in startup TwoHop Ventures. His background in mechanical engineering doesn’t scream a career in cryptocurrencies, but it has served him in his understanding of the subject.
“When I was doing my research in what makes cryptocurrencies special, I came across this concept called thermoeconomics. I’m a mechanical engineer by trade and I’ve studied thermodynamics, and when I read what it effectively proposed is that money is a representation of energy, and all of human interaction is just energy. So when you frame money as energy, when a central bank prints money, they’re stealing energy from the civilization,” he said.
This talk of energy may be a little hippie-sounding, but Fauvel keeps the conversation grounded in tangible instances. “[Y]ou can make parallels with that in biology. You have this dynamic called the red queen hypothesis which is parasites and hosts, and parasites steal energy from a host. So in that respect, central banks really act like parasites, and if they get too big, they kill both the parasite and the host,” he said, which brought to mind the 2008 American housing crisis where Bitcoin—whose first real application was poker—emerged as a possible alternative to traditional financial institutions.
Cryptocurrencies have been regarded as a way to bring back sound money, yet the scaling problem of BTC shows that even the new technology could be subject to centralized powers.
“When I first discovered cryptocurrencies in 2013, like everyone I fell in love with Bitcoin. And then it broke my heart, just like Brian Armstrong from Coinbase. And Ethereum was all the rage. Something never really sat quite right with Ethereum to me, and that’s partly probably because it was supposed to be built on [BTC]. And then Bitcoin Cash happened,” Fauvel said, with BCH able to surmount what BTC couldn’t. But he wasn’t on board immediately.
“To be honest, before the fork, I didn’t think a minority fork could survive, but then my understanding of the incentive mechanisms that drive miners to continue to mine developed, so that I realized they’re not hostile. And if they are hostile, the whole thing breaks down, but because they are part of the system, they’re never going to be hostile,” he said.
If you’re interested in helping the growth of merchant adoption of Bitcoin BCH, join the bComm Association, an industry group that intends to be the focal point for miners, merchants, exchanges, developers and members of the BCH community. Developers and merchants of the Bitcoin BCH community will also be on hand for the first CoinGeek Week happening in London in November. Members of bComm Association can avail CoinGeek Week tickets at discounted prices. To purchase tickets or learn more about CoinGeek Week Conference, visit the official website here.