The Central Banks’ Bank (BIS) Hates Bitcoin — Which is Reassuring

[felixesteban]

The Bank for International Settlements (BIS), a global “bank for central banks” based in Basel, Switzerland, has once more declared that cryptocurrencies are not only “not ready for prime time,” but could also “bring the Internet to a halt.”

[Note: This is an op-ed]
BIS: Bitcoin, You Scary

On Sunday, BIS released a new 24-page document outlining why it believes cryptocurrencies like Bitcoin cannot become a bona fide financial instrument for the global economy.

The latest report cites a “range of shortcoming,” including the usual concerns over high volatility and electricity consumption, as well as inability to scale. The BIS extrapolates that if Bitcoin was to process all global payments in its current state, the decentralized network would overload everything from mobile devices to servers around the globe and effectively break the internet. The report notes:

    The associated communication volumes could bring the internet to a halt, as millions of users exchanged files on the order of magnitude of a terabyte.

BIS

The environmental impact would also be significant, according to the report, which estimates that the total electricity consumption of Bitcoin mining equals to that of mid-sized economies like Switzerland.

“Put in the simplest terms, the quest for decentralised trust has quickly become an environmental disaster,” it reads.

The paper also cites 5-year old data to demonstrate volatility, while being completely oblivious to layered scaling solutions, like the Lightning network, currently being rolled out, which have the potential to process millions of transactions per second — more than Visa and Mastercard combined.

http://bitcoinist.com/bank-bis-hates-bitcoin-reassuring/