Justin Bons: Bitcoin ‘one of the worst cryptocurrencies’

Cyber Capital chief investment officer Justin Bons has said that Bitcoin is “technically one of the worst cryptocurrencies," adding that the network and its native token are a “purely speculative asset without utility."

Bons explained that the value of Bitcoin's offering deteriorated due to broken long-term security and "weak" economic qualities compared to other cryptocurrencies. He also said that Bitcoin lacked capacity, composability, and programmability in technological aspects.

“The world has also moved on and progressed,” Bons said on Twitter. “I remember it used to be said that BTC would just adopt the best technologies. This thesis has obviously completely failed as BTC has no smart contracts, privacy tech or scaling breakthroughs.”

Bons compared Bitcoin to other blockchains that adopted better token design methods, with some implementing smart contracts with fee-burning mechanisms that can lead to negative inflation rates for the native tokens.

Ethereum, the second largest crypto coin in the world, recently announced a phase called The Merge, which will take place this September. The Merge will change Ethereum's method of operation from a proof-of-work consensus mechanism to a proof-of-stake one. Ethereum claimed it would reduce energy consumption by 99 percent. The announcement of the plan caused a hike in Ethereum prices.

Cardano also recently announced upgrades to its blockchain—the Vasil hard fork. The platform announced four plans to upgrade its services, namely CIP-31, CIP-32, CIP-33, and CIP-40. According to Cardano, CIP-31, a reference input upgrade, will reduce transaction costs on the blockchain. The plans are scheduled for “sometime in September."

Bons’ criticism of Bitcoin did not address the blockchain’s Lightning network, which was reportedly developed to respond to its scaling problem. It is a second layer to the network, which allows transactions to be performed off-chain between two parties.

According to Arcane Research, the transaction volume within the Lightning network grew by 410 percent between Q1 of 2021 and 2022. The reasons were its integration to the Cash App, Paxful, and the El Salvadoran government crypto wallet, Chivo.

The Lightning network has been adopted by several crypto exchanges, including Kraken, OKEx, and Okcoin. Earlier this month, the network reached an all-time high of 4,351 BTC, or approximately $100 million, recorded in the system.

Nonetheless, analysts have said that the Lightning network did not fully solve Bitcoin's scalability issue. Instead, it introduced new problems, such as malicious attacks and low routing fees, which caused transactions to require longer processing time.

Others’ reactions to Bitcoin

Other experts in the finance industry have earlier commented on Bitcoin. These include Yifan He, the chairman of China’s Blockchain Service Network. He said, “all unregulated cryptocurrencies including Bitcoin are Ponzi schemes."

Rosa Rios, a former U.S. treasurer, also described Bitcoin as “nothing more than a speculative tool” last year. She compared the cryptocurrency to other digital assets like XRP, which accommodates cross-border transactions.

Bitcoin was launched in 2009 as a peer-to-peer digital cash system. According to its founder, Satoshi Nakamoto, any speculation on Bitcoin’s investment value is a by-product of its main purpose.

However, Bons also said that Bitcoin had “dramatically changed." He referred to the blockchain’s decision not to increase its block size limit, calling it a “major departure from the original vision and purpose of Bitcoin."