Is Bitcoin Useful to Consumers?

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Bitcoin made headlines again on October 31st as the Chicago Mercantile Exchange, the largest futures and options market in the world, announced that it would soon be offering Bitcoin futures, allowing investors to bet on the future price of the currency. This came a month after the digital currency broke the $5,000 per bitcoin barrier and has continued climbing to over $6,500 per bitcoin as of November 1st. This is an incredible increase from starting the year at $1,000 per coin, and at this point it is unclear whether this is a bubble, the currency is finally breaking into the mainstream, or a little of both. Aside from a way for tech-savvy investors to make millions, a true test of Bitcoin as a replacement or supplement to traditional fiat currencies such as Dollars or Euros will be whether or not the average consumer will be able to find any use for them.


To understand whether or not Bitcoin can be useful to consumers, first one must understand the intrinsic values that set Bitcoin apart from other currencies. Every transaction is verified and recorded on a public ledger, called the blockchain, with participants hidden behind anonymous bitcoin wallet ID numbers. End users can use bitcoin wallets, software that gives a user a wallet ID and tallies their holdings based off of transactions they participated in. From there, users can send and receive parts of or entire bitcoins securely and anonymously using the encryption built into the Bitcoin platform. (1) In the long term, the implications of this system are a currency that is independent from government meddling, as well as being completely anonymous in a world where it seems like every week a new batch of millions of credit card details is stolen. (2) This video, from, goes more in depth into what the blockchain that drives Bitcoin is, how it works, and what the practical benefits are.


Wide reaching positive effects have never been a reliable driver for change, especially when it involves tradeoffs. For example, a significant part of the US still smokes cigarettes despite many cheaper and healthier options being available. In the case of Bitcoin, new users are stepping into a volatile market where, next week, their stash of bitcoins could be worth hundreds more or less than they were a week before. Your bitcoin wallet is the only connection you have to your funds; if you lose the passcode for it then your money is effectively gone, unlike actual banks that are happy to hold on to your money. Bitcoin transactions are only verified onto the blockchain as fast as the network can write new blocks, which means transactions are not confirmed for 10 minutes to up to an hour or more on busy days. (3) This is a result of Bitcoin’s coding, which dictates how often new blocks of transactions are confirmed on the public ledger. Due to Bitcoin’s decentralized system, this can only change once a majority of the computers in the Bitcoin network “vote” to change this by running new coding. Until that happens, this remains a massive barrier to the ability for a consumer to go trade 1/2000th of a bitcoin for a cup of coffee.


For online shoppers, the outlook on the usefulness of Bitcoin is much brighter. Many retailers now accept bitcoin as a payment option, and for those that do not, there is often a workaround in place that allows it. Hardware retailers have been quicker than most to jump on the Bitcoin trend, with Dell and Microsoft both accepting bitcoin as a payment option. Newegg, a consumer computer parts supplier, also has begun accepting bitcoin as well. Middleman services such as even allow for users to buy from Amazon at a discount using bitcoin, by connecting their orders with people who want to trade Amazon gift cards for bitcoin. Gift card suppliers also serve as a way to connect bitcoin to the outside world, with companies such as Egifter and Gyft allowing users to buy gift cards for common retailers such as Starbucks or the Gap with bitcoin. With the ultimate goal being a universal and secure currency, an obvious use for Bitcoin would be in travel so people would not have to deal with currency exchanges. This is becoming less of a pipe dream as travel companies, such as Expedia, have started to accept bitcoin to book hotels. (4)


Everyday usability is still an elusive goal for Bitcoin, and for the foreseeable future, the average consumer will be better off using traditional currencies for purchases. However, as Bitcoin continues to make headlines and smash records, it is not a bad idea for more people to attempt to better understand the platform and how to use it. If society moves on to digital currencies like Bitcoin in the future, the transition will be a lot easier to those who have experience with it.


Works Cited


Inside the Search for the New Uber CEO

Uber’s new CEO, Dara Khosrowshahi


On August 28th, Uber announced that their new CEO would be former travel company Expedia’s CEO, Dara Khosrowshahi. This comes after a two and a half month search after Travis Kalanick, the founding CEO, stepped away from normal operations on July 13th. The ridesharing company is the most valuable private company on Earth, worth over $70 billion. It employs over 12000 people, in addition to hundreds of thousands of contracted drivers. Ride bookings have been steadily increasing, and have been up 16% in the last quarter.1 It’s autonomous car program has been underway in Pittsburgh since 2015 and has since expanded to San Francisco and Phoenix, showing that Uber is at the cutting edge of commuter technology.2  Despite this, Uber is still an unprofitable company, reporting losses of $645 million in the second quarter of 2017. Based on this, the position should have been easy to fill by the best talent the world has to offer. Any CEO presiding over Uber when it finally becomes profitable, as well as the potential for an IPO to make Uber a publicly traded company, stands to gain an immense amount of power, money, and prestige. This begs the question: Why did it take two and a half months to decide?

For all of the success Uber has seen in the last few months, it has also suffered through a deep sea of scandals, ranging from toxic workplace culture, creating programs to blacklist people and authorities to evade detection, and allegations of intellectual property theft from Google’s autonomous car program. Any new CEO would have to rehabilitate a public image that clearly has seen better days. With baggage that heavy, it was not a surprise that the pool of candidates had shrunk considerably. For those that remained, the question became “How can we pick a candidate that can satisfy the demands of the factions within the board?”.

It was no secret that Mr. Kalanick had not wanted to step down from his position. He retained a seat on the board, and kept a group of loyalists with him that still believed in his controversial style of management, which could be seen as both the result of Uber’s success as well as the reason why it is stuck in it’s current PR quagmire. Even after leaving his position, he still maintained a deep interest in the daily operations of Uber, and during the search for CEO, he has said that he was “Steve Jobs-ing it”, referencing Steve Jobs’ return to Apple after being pushed out.4 A potential part of this plan would be to dilute the power of the other board members by accepting investment funding from Softbank, a Japanese conglomerate that has also invested in other ridesharing services around the world.5 This conflict of interest had caused Mr. Kalanick to be largely shut out from the CEO selection process.

Among the board members opposing Mr. Kalanick’s return, their most promising candidate was shut out before they were even able to have a vote. Meg Whitman, CEO of Hewlett Packard Enterprise and responsible for the rise of eBay was interested in the position and had met with several of the board members to discuss the option. Her track record is amazing, and with that comes caveats that she would require of the board to take her on as CEO. The most disagreeable of her requirements was a desire to restructure the board. Unlike other tech companies, the Uber board holds an unwieldy amount of power and often uses that to meddle in daily affairs of the company, as shown by Mr. Kalanick’s actions after stepping down. She wanted to limit their powers, which in it’s own was a deal breaker.6 Once news of her candidacy leaked and the rumor mill started up, she posted on twitter that “Uber’s CEO will not be Meg Whitman.”, and that was the end of that.

Further conflicts on the board arose in early August when Benchmark, a capital firm in Silicon Valley, sued Mr. Kalanick for fraud in an to attempt to remove him from the board. They alleged that when he increased the size of the Uber board from eight to eleven seats earlier that year and then appointed himself to one of the seats, as well as by hiding scandals within Uber itself from the board, he had manipulated investors in order to retain power in the company.7 As of August 30th, the case was decided in favor of Mr. Kalanick.

The choosing of Mr. Khosrowshahi is the result of a compromise of those on the board that wanted someone who can reform the company without degrading their power. However, this does not mean he is a weak candidate. From his leadership in Expedia, he has quadrupled the company’s travel bookings and is known for his deal making skills.8 A steady hand may be what Uber needs in these trying times for the company, and in the coming months we will see if Mr. Khosrowshahi is able to accomplish that. When the stakes are the fate of a 70 billion dollar company, what we do know is that this will probably not be the last of the drama we hear about Uber.