Ed MacNair, chief executive and founder of CensorNet, says Yes.
While this security breach is a set back, the incident does not necessarily sound the death knell for bitcoin that some are predicting. Any form of currency which exists in digital form – and for that we should read all currency – has a significant exposure to this type of threat. Cybercriminals do not discriminate between bitcoin, personal data, core banking systems or business data: it is all fair game nowadays as any digital asset with value is now a target. The drop in bitcoin’s value is more reflective of the reputational whacking that an organisation now takes when it suffers a very public breach like this, as opposed to being indicative of its long-term future as a currency. As today’s threat landscape becomes more advanced, securing any company’s points of access to the internet should be an absolute number one priority. Bitcoin will recover, but exchanges and the community more widely should look to ensure it is proactively monitored, and address vulnerabilities such as this in a more effective way.
Nicolas Debock, principal investor at Balderton Capital, says No.
Bitcoin was created to be an alternative asset, so it should become nothing else. It was designed to have the same attributes as gold: there is a unique global quantity (much like gold, there is finite number of bitcoin), and it is non-replicable (using whatever alchemy you can, you can’t create fake bitcoin). Blockchain, the underlying technology on which bitcoin is built and used, is not an alternative asset class but a technology that enables decentralised, non-contestable, trustless transactions. So bitcoin has “created” something that can be more than an asset class, but that is not equivocal to saying it is one. Bitcoin tumbled because a large exchange, Bitfinex, was hacked of 120,000 bitcoin. This represents roughly 0.75 per cent of bitcoin currently in circulation. This encapsulates the current risk of bitcoin as an asset class: the high concentration of miners and exchanges. It creates a problem similar to putting a large amount of gold in one vault: it would attract thieves.