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Swansea councillor wants Wales to be at forefront of Bitcoin revolution

12 Nov 2021 5 minutes Read
Swansea councillor and Bitcoin evangelist Will Thomas.

Richard Youle, local democracy reporter

A Swansea councillor believes Bitcoin will one day underpin the world’s financial system and would like Wales to be at the forefront of the currency revolution.

Will Thomas has invested in Bitcoin for years and hopes businesses which trade in it will come to Wales in the future.

Bitcoin is referred to as a cryptocurrency but Cllr Thomas said he preferred the term ‘peer-to-peer decentralised currency’.

“The cryptocurrency industry is still a Wild West,” he said. “Bitcoin is different to this.”

Cllr Thomas said that Bitcoin was completely decentralised and that it couldn’t be shut down or interfered with.

Bitcoin is a digital or virtual currency created in 2009 which facilitates instant payments without the need for a central bank or other type of administrator.

Each Bitcoin is a computer file which is usually stored on a digital wallet on a computer or smartphone.

You can buy them using real money or get paid in them when you sell things. Bitcoin has been accepted as legal tender in El Salvador.

Although this might all sound strange, it’s not impossible to grasp. Things do start to become complicated though.

Bitcoins can be mined electronically. Every transaction is recorded in a public list called the blockchain.

Every Bitcoin is broken down into 100 million Satoshis – named after Satoshi Nakamoto, the person or pseudonym of the person who created the digital currency. And only 21 million Bitcoins will ever be created.

“It’s a very exciting technology,” said Cllr Thomas.

Bitcoin’s value has soared but it is extremely volatile.

“It’s gone up 350% this year alone but it’s crashed twice in between by 50%,” said Cllr Thomas.

The Conservative ward for member for Newton said there might be a day when everyone used digital currencies to pay for goods and services but he viewed Bitcoin as “a store of value”.

“I liken it to digital gold,” he said.

The 39-year-old, who also runs an antiques business, said Bitcoin’s rising value rewarded saving rather than spending.

In his view if it was used as the currency standard it would dampen debt-fuelled consumer spending, in turn benefiting the environment.

The colossal energy use associated with Bitcoin mining – the electronic process by which new Bitcoins are entered into circulation and by which new transactions are confirmed by the network – has garnered a lot of headlines.

One recent example was a gas power station in upstate New York which uses a large chunk of the electricity it generates to power computer servers to mine Bitcoins.

China has cracked down hard on Bitcoin mining.

Cllr Thomas said mining carried out in the Western world tended to be less environmentally-damaging.

He said he had not cashed in his Bitcoin currency but admitted he couldn’t help checking its value. “A minimum of once a day,” he said. “But there’s no need to.”

At the time of our interview, one Bitcoin was worth £47,858.

For a while Bitcoin was accepted as payment at Mumbles Coffee and is due to be again when an updated digital wallet is finalised for the business said Gareth Davies, who runs the business with his wife Lynne.

Mr Davies said the previous digital wallet could take a few minutes to complete the transaction – not ideal if someone was buying a cappuccino.

He said there were about half a dozen customers who would pay by Bitcoin.

“We had a sign outside and people were always interested in it,” said Mr Davies.

He added that, having researched the subject, he has invested in the digital currency. “The more you read, the more you are interested,” he said.

Cllr Thomas urged people to do their research and not consider investing money which they needed to pay their bills. “Don’t use that money,” he said.

‘Negative headlines’

Simon Rudkin, a senior lecturer in economics at Swansea University, said Bitcoin was now an established part of the financial landscape.

“From the economic perspective the value in any currency comes from the fact that we believe the piece of paper in our hands has worth,” said Dr Rudkin.

“This should be no different when it comes to replacing that paper with a digital code.

“It is right to say that not being within the control of one government, or one political system, is an advantage and having a truly global system of exchange brings benefits.”

He said these may be felt more in developing economies where local currencies and political systems were more volatile. But he also pointed out risks.

“The fact that Bitcoin is not anchored by a government means that it is susceptible to wilder swings in value and ultimately has the potential to collapse,” he said.

“We cannot talk about cryptocurrency without talking about mining and the potential criminal risks.

“These are the negative headlines that surround the technology and that the industry is working hard to address.

“On the environment technology is the friend both in terms of green electricity and more effective computational power.”

It seems like Bitcoin and other cryptocurrencies are here to stay.

“We are seeing central banks talking seriously about cryptocurrency; the rise of Bitcoin is undeniably forcing their hand on that one,” said Dr Rudkin.

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Hannergylch
Hannergylch
22 days ago

Bitcoin has two serious shortcomings that never get mentioned in the media. First, if you pay for something in bitcoin, the recipient can see how much you’ve got leftover at your address, and can monitor that address thereafter — since the ledger is public, with no encryption. If you pay your rent in bitcoin, your landlord can scrutinise the public ledger (the blockchain) to figure out when to put up your rent, and by how much. And whenever a real-world transaction links your real identity to a Bitcoin address, any criminals who get hold of that information can use the… Read more »

j humphrys
j humphrys
22 days ago
Reply to  Hannergylch

Thanks for the info!

Satoshi
Satoshi
22 days ago
Reply to  Hannergylch

This is why it is best practice to not re-use addresses. You don’t hold all your bitcoin on one address so point one is moot.

Bitcoin is fungible, it’s that simple. There are lists of ‘tainted’ coins but very very few in the industry pay attention to this.

Erisian
Erisian
22 days ago

Currency or Ponzi Scheme?
How can it be a real currency when its value keeps rising and crashing.
How can anyone justify the amount of electricity used?
https://minerdaily.com/2021/how-much-power-does-it-take-to-mine-a-bitcoin/
And why should having ‘mined’ one be worth so much ‘money’.

Last edited 22 days ago by Erisian
Satoshi
Satoshi
22 days ago
Reply to  Erisian

Currency eventually. Have a look for the article The Bullish Case for Bitcoin, it will answer these questions very well for you. Vijya is the author.

Dai
Dai
21 days ago
Reply to  Erisian

Don’t think of it like a currency, think of it as a store of wealth, like the price of gold or oil, the price goes up and the price goes down depending on supply and demand.
Supply is governed by the mathematics of the system rather than by a corporation or government.
Demand is open to the users to decide how much they want it – if nobody wants it, it’s worthless when the value drops below the cost of electricity to mine it, if people are happy to store value in it, it’s worth something.

Michael Samuels
Michael Samuels
20 days ago
Reply to  Dai

So essentially it’s just a bank… A bank that costs more in electricity and environmental damage than any substitute we had before it. An unnecessary transition into digital currency which will completely undermine any current attempt to protect our planet.

Michael Samuels
Michael Samuels
20 days ago
Reply to  Erisian

More like, genuine public interest or politicians desperate bid to boost his Bitcoin stocks.

Steve Jay
21 days ago

I believe cryptocurrency is the future and el Salvador has officially made bitcoin legal tender which is a very promising step indeed. However, Bitcoin mining does have a negative impact on the environment and we cannot ignore this massive failing of Bitcoin. Therefore if I do consider a crypto investment I’ll probably purchase SafeMoon. In addition to offering real world utility SafeMoon is looking at generating clean energy with wind turbines whereby each unit of electricity generated adds value to each SafeMoon token in circulation. Clean eco friendly cyrptonomics replacing mining is key.

Dai
Dai
21 days ago

There’s a lot of errors and misunderstanding in this article.
I don’t believe bitcoin itself is the future of Wales but decentralised stores and transfer of value can certainly play a part if we find the right uses for it

Michael Samuels
Michael Samuels
20 days ago

Perfect example of what’s wrong with Welsh councillors. None of them actually focus on their community and instead waste their tine chasing fantastical pipe dreams and trying to make themselves stand out in the crowd. Taking a public service and making it all about self serving, often uneducated guesswork, that they havnt even invested the time to properly research in the first place. How on earth (with recent months being so focused on environmentalism) has this moron crawled out of the gutter to advocate cryptocurrency – one of the most environmentally damaging parts of today’s society. Not only that, but… Read more »

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