“Bitcoin Likely to Adopt the Function of a Reserve Cryptocurrency in the Future,” Andrew Thornhill, Founder of Spotcoin

“Bitcoin Likely to Adopt the Function of a Reserve Cryptocurrency in the Future,” Andrew Thornhill, Founder of Spotcoin

“Bitcoin Likely to Adopt the Function of a Reserve Cryptocurrency in the Future,” Andrew Thornhill, Founder of Spotcoin

The FINANCIAL -- Spotcoin is a clearing house for digital currencies providing wholesale trading options in an express way. The platform helps businesses quickly buy and sell cryptocurrencies utilizing a one-day standard for all transactions. Its founder, Andrew Thornhill, American businessman residing in Georgia, shared his knowledge of the cryptocurrency industry and highlighted his future expectations.

“Georgia is not the best place for this kind of business in the grand scheme of things. However, I live here and therefore I decided to conduct my business locally. Our aim is to become a regional hub for cryptocurrency and fiat money exchange.”

“Cryptocurrencies are rather difficult to trade in Georgia. In order to trade them with fiat money in Georgia, an emoney account is necessary, an online platform tied to Liberty Bank. Commission fees are substantial, not to imply that they are somehow through the roof compared to the global standard.”

“In Georgia, the problem with cryptocurrencies is that the market is not regulated at all. Due to this, banks are not keen on engaging in transactions. I’m not suddenly asking for Georgia to become a regulatory swamp, however, any kind of financial interaction needs certain framework in order to define the rules of the game for the parties involved, otherwise it becomes too obscure and risky to engage in.”

“Globally, liquidity of cryptocurrencies is quite low. Although more and more companies are accepting them as a way of payment, the number of such entities is rather insubstantial.”

“At the moment, according to the information that I have, cost of cryptocurrency production is around 20 times lower than printing money and 800 times lower than gold mining, which is a very expensive process. By extension, one of the main directions cryptocurrencies could work in is to reduce the number of verifications a transaction needs. Currently, some need up to 15,000 blocks to verify a single transaction, which is absurd and completely unnecessary. Reduction is unlikely to happen with Bitcoin. However, with new, more innovative cryptocurrencies coming up, active work could be done in this direction, which would substantially reduce the costs of cryptocurrency system operation and make it much more efficient than it is now.”

“Blockchain’s transaction fees are inherently cheaper than those of the banks. This has misled a lot of people into believing that cryptocurrencies will somehow end up toppling the banking system. This will, in my opinion, definitely not be the case. Cryptocurrencies do have their niche, however, for example, small transactions are still much better off made through a credit card provided by the bank, which, by the way, uses a system quite similar to cryptocurrencies to conduct transactions.”

“Years on, I would expect banks to make full use out of the Blockchain technology, on which the cryptocurrencies are actually run. The idea that electronic currencies will finally put an end to banks is false, as not only can they profit from the technology itself, but also because the transactions and options financial institutions provide are necessary for the adequate functioning of the global economy.”

“Blockchain technology itself is highly versatile. In the countries where property seizure and disputes still present a problem, it is a safer way to verify ownership. Georgian Registry already uses the technology to great success. The decentralization aspect of the Blockchain technology is incredible. Two parties paying another person to verify their transaction, makes total sense. It truly amplifies the global economic aspect of today’s world – one party could be in Georgia, for example, another could be from Sweden and the transaction could be verified by someone from Estonia and it would present absolutely no problem; the interaction would work just as well as if the three were standing right beside one another.”

“In the future, Bitcoin is likely to remain relevant on the cryptocurrency market. It may adopt a function similar to what gold had in the past, or what the dominant currencies like the Euro and Dollar have today – as a reserve to solidify the backbone of other, smaller but more innovative currencies.”

“Concerns have been raised about the ecological impact of cryptocurrency mining. Luckily, Georgia has the potential to mine without significantly damaging the environment. Georgian Hydroelectric stations produce surplus energy during warmer times of the year. This energy cannot be stored, therefore, it has to go on export. It is entirely possible to buy this energy in order to run cryptocurrency factories. This would also, by proxy, be beneficial for energy companies as well, as they would have new customers competing for their product. We are currently negotiating to build 10 and 5 MW mining factories in Georgia, operating on energy purchased from local hydroelectric stations. We are perfectly willing to pay the standard electricity prices that the Georgian market offers.”