It’s only been 13 years since Bitcoin (BTC) Mayflower, when a few intrepid travelers decided to turn their backs on the Fiat empire and travel to a new country of financial sovereignty. But while it took 150 years for American colonists to become sufficient in numbers to throw off the yoke of a non-representative government, the Bitcoin Republic went from pilgrimage to revolutionary army in just a decade.
Who are these new bitcoins? How do their personalities, demographics and technical expertise differ from the early users? Is Generation Bitcoin prepared enough to protect its investments from current and future security threats? More importantly, what problems must a fast-growing society address in order to ensure the success of our revolution?
Who are bitcoins today? Although we do not know for sure, we can see some trends at a high level.
These changes can be represented in several ways. First, there is anecdotal but still valuable anecdotal evidence, such as greater diversity in attendance at industry events and more women in leadership roles in the industry.
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Then there is public data such as the number of companies that have bitcoin on the balance sheet. Many years ago, pioneers like MicroStrategy were ridiculed. Today, a growing group of public and private companies (as well as land) own parts of their bitcoin vaults, and a wave of miners has gone public.
More importantly, the available human data shows that old stereotypes are also changing rapidly. In the UK, for example, the proportion of investors over 55 who hold cryptocurrencies jumped from 7 percent to 22 percent between 2019 and 2020. Similarly, a recent consumer study by Gemini found that more than half of “curious” cryptocurrency consumers are encrypted. are women, a quarter of whom are over 55 years old.
Bitcoin adoption certainly has room to grow before it catches up with the demographic diversity of the wider population, but today’s investors are clearly very different from the Bitcoin Mayflower generation. While this is welcome, it also means that their technical development, including their safety awareness and skills, is more ambiguous. The big question is: are they prepared for the threats they face?
The colonial rebels were lucky with the choice of enemy: a divided government led by a king 3,000 miles above sea level. In today’s digital world, we are used to the most diverse, insidious and swift threats from clumsy national parliaments. However, in my most recent review of 1600 bitcoins, the second most frequently cited threat was forfeiture by the authorities.
It is easy to understand why over a quarter of those surveyed believe that this is the case. First, in jurisdictions such as China, cryptocurrency campaigns are very popular. The United States also confiscated citizens’ assets as gold during the Great Depression. The risk of a state takeover is more than theoretical.
But as I have often pointed out – and a large number of respondents agreed – in fact, the biggest threat to bitcoin users is accidental loss. However, the risk landscape for bitcoin is significantly more complex than for other forms of digital security, and bitcoin must fight the authorities in addition to forgetting it.
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Although the security landscape is actually complex, the real threat to users’ currencies (and the solution) is actually quite simple and can be summed up in one word: ease of use.
This security solution is beautifully wrapped in a recent Reddit post:
“People who use the Internet are not ‘Internet enthusiasts’ and do not care about learning technology, they just want to use the Internet easily and simply. When encryption becomes mainstream, it will be exactly the same for 99.9% of all users.”
For the early Bitcoin pilgrims, simplicity was never an issue – they embraced best practices for securing digital assets from the start, such as self-protection and multi-signature security. We now have a much more diverse group of bitcoins, and a much smaller percentage of them know how to keep their currencies safe, even if they understand the threats they face.
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I do not need to explain what this means: more people will risk their investments by leaving their coins on a stock exchange or by adopting practical security routines such as storing passwords and freezing sentences online.