Bitcoin could go the way of Sony’s Betamax videotape and flop compared to its competitors. Glenn Hutchins, a tech investor who sits on boards of the Federal Reserve Bank of New York and the NASDAQ OMX Group as well as being a major tech investor, made the claim in an interview on CNBC on May 9.
Hutchins sees one of Bitcoin’s competitors coming out on top, much as the JVC-led VHS format eventually beat out Betamax in the 1980s. In drawing out the parallel to the videotape format wars, the former Seagate Technology and Gartner board member sees different coins filling specific functions and carving out their niches in that manner.
"The token of exchange at the heart of the math solution that leads the technology will be there," Hutchins said. "Different tokens will be used for different applications."
The reference fits as Betamax had slight technological edges in playback and audio specifications and VHS was both cheaper and had longer recording times. Consumers generally voted with their pockets and Betamax eventually became a niche product for videophiles.
While cryptocurrencies have been compared to gold in recent months, especially during the late-2017 price surge, Hutchins sees things in a utilitarian light. "I think it's more like copper, like an industrial metal that's used for a purpose to drive an outcome." He also sees that, "There will be a token that's used just like there's an industrial metal that's used for wiring."
Currently, bitcoin still accounts for over 36% of the world’s cryptocurrency market, as per CMC. Ethereum is placed second at 17% of the market and XRP had a 7% market share. New coins continue to appear on the market and are designed to remedy shortcomings seen in Bitcoin. So far, however, they have not succeeded in replacing it.