Peter Schiff: "Even if you assume, "okay, cryptocurrencies are going to work," I cannot think of an example throughout history where any innovation- where the first one was the best one, right? Whatever was invented, whether someone invented the telephone- the first telephone was not the best telephone - it's been improved upon. The first television, the first automobile.
So if cryptocurrency would work, why would we assume that Bitcoin is the one that's going to succeed? Why would the first attempt be the best attempt? Why wouldn't somebody come up with something better, that's quicker, that's more reliable, that's more secure than Bitcoin? And if somebody can do that, then it renders Bitcoin worthless because there's something better."
P1. It is extremely unlikely that the first version of a product is the best version of that product type. P2. Bitcoin is the first version of a product type. Therefore: C3. It is extremely unlikely that Bitcoin is the best version of that product type.
P4. If someone invents a superior version of Bitcoin, then Bitcoin will be worthless. P5. Someone will invent a superior version of Bitcoin. Therefore: C6. Bitcoin will be worthless.
P4. Disagree. This Premise assumes that only ONE product can retain value in a given marketplace (which requires that all consumers switch to using the one, single, "best" product), which is a False assumption.
Clearly, there is more than one type of telephone that exists today, just as there's more than one type of television, type of automobile, and type of money.
In all likelihood, many cryptocurrencies will exist simultaneously, each with a different use case, market segmentation, and market capitalization.
If someone invents a "superior" version of Bitcoin, then Bitcoin will become less valuable.
P5. Dubious. The label of "superior" is completely subjective, and every product-maker (in every market) must consider various tradeoffs in product design and functionality.
In cryptocurrencies, there is a 3-way tradeoff among security, scalability, and decentralization - you can pick at most two. Bitcoin attempts to have "unrivaled" security and decentralization, and it chooses to sacrifice its scalability. Other cryptocurrencies attempt to favor scalability, for example, at the expense of either security or decentralization.
C6. Agree, but for different reasons.
Bitcoin will become "less valuable" if and when a "superior" version is released.
Bitcoin will become "worthless" when its utility disappears (i.e. its security is compromised). This will not be a function of the competitive landscape (e.g. "other cryptocurrencies"), but rather the technological landscape (e.g. "disruptive technologies," such as quantum computing).