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Bitcoin First and Separate from Other Digital Assets: Fidelity

Fidelity believes Bitcoin is the most secure, decentralized, sound digital money and any “improvement” will necessarily face tradeoffs.

Bitcoin is the most well-known cryptocurrency throughout the world.

Global brokerage giant Fidelity has asserted that it is a special cryptocurrency.
A research report, titled ‘Bitcoin First’, by its digital asset arm, Fidelity Digital Assets, claims that Bitcoin should be treated differently from all other cryptocurrencies.

“Bitcoin clearly possesses a lot of good qualities of money, combining the scarcity and durability of gold with the ease of use, storage, and transportability of fiat.”

So Bitcoin is the ideal form of money. Fidelity even called it the entry point of traditional investors into the crypto-verse.

The research also adds that it is the most secure, Decentralized, sound digital money and any “improvement” will necessarily face tradeoffs. It solves nearly all the problems and Altcoins only solve the remaining problems and fulfil the needs which Bitcoin does not.

The report also discusses concepts like “The Blockchain Trilemma” and its trade-offs. This concept was outlined by Ethereum cofounder Vitalik Buterin. He has stated that a decentralized database can only deliver on two of three guarantees at one time: Decentralization, Security, or Scalability.

Bitcoin network guarantees the former 2 but is not able to deliver on the Scalability part. Nonetheless, it is the most dominant cryptocurrency.

The research also cited “The Lindy Effect”. It is a “theory that the longer some non-perishable thing survives, the more likely it is to survive in the future.”

Moreover, Bitcoin’s monetary network effects are unparalleled, according to the report.

BTC Dominance Chart on TradingView

Well, Bitcoin is the Reserve Currency of the crypto-verse, but it alone cannot shape the future of Digital Assets. Its dominance stands at 42% as per TradingView. A year ago it was close to 70%. As the crypto-verse proliferates, more cryptocurrencies will challenge Bitcoin’s supremacy. At press time, Bitcoin is trading for roughly 38600 USDT on Binance.

News recommendation: Inside the Crypto Tax Regime Announced in Budget 2022-23

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