21 Questions About Bitcoin II
5. What are Altcoins and "Shitcoins"?
Although I have intentionally avoided the topic of other cryptocurrencies in this book, it would be unfair not to at least briefly mention other alternative coins – known as altcoins (or as Bitcoin fans fondly call them – shitcoins). What exactly are altcoins? They are all cryptocurrencies except for Bitcoin.
If I had written this book ten years ago, the list of the most famous altcoins would look completely different than it does today. And if you get your hands on this book ten years from now, many of today’s "top" altcoins will likely mean nothing to you. The reason is simple – most of them lose value over time, disappear, or fall into oblivion.
My historically first purchase of cryptocurrencies was in 2017 – and paradoxically, I didn't choose Bitcoin. At that time, it was approaching the $20,000 mark, and I felt like I had "missed the train." Like many newcomers, I looked for an alternative that would be "cheaper" and offer greater growth potential. So I bought 1 Litecoin, later XRP, and a whole range of other cryptocurrencies. I remember owning thousands of these unknown coins and calculating how I would be a millionaire if even one of them reached $10. None of that happened. Most of these projects have either completely ended or are in a worse position today than they were eight years ago.
Many people are attracted by their low price (I was no exception), they compare them to Bitcoin and imagine that "since Bitcoin once cost a dollar, this coin will surely get there too." The problem, however, is that we are comparing two incomparable things. Bitcoin has a fixed supply of coins. Many altcoins have no such limit and can be "printed" into circulation indefinitely, which significantly reduces their value as a store of value.
While with Bitcoin we don't know its creator, most altcoins have known founders who are often linked to companies or investors. This means these networks are easier to regulate, manipulate, or even shut down. While Bitcoin runs on thousands of independent computers worldwide, some altcoins run on a few servers rented through Amazon Web Services. Shutting them down is thus a matter of a few clicks.
Bitcoin was the first. And after it came countless altcoins – some brought technical innovations, others only marketing promises. So far, however, none of them have passed the test of time like Bitcoin. Even if a new, "better" Bitcoin were created today, it would run into the same problem – the trust and wide decentralization that Bitcoin built back when no one was paying attention to it. Today’s world is different. Regulations are stricter, states are more watchful, and replicating the conditions in which Bitcoin was born is practically impossible.
Can money be made on altcoins? In the short term, probably yes. Many altcoins experience rapid increases in value, often by dozens or hundreds of percent within days or weeks. However, this sharp rise is usually accompanied by an equally rapid fall. What rises sharply today may lose most of its value tomorrow. The volatility of altcoins is incomparably higher than that of Bitcoin.
If you compare any alternative cryptocurrency with Bitcoin from a long-term perspective, you will find that performance is almost always in favor of Bitcoin. While Bitcoin has over a decade of existence, a proven security model, and growing trust from institutions and ordinary people, altcoins often build on promises and trends.
Many altcoins lured people with so-called "game-changing" technologies and big visions. Some promised higher scalability than Bitcoin, others focused on revolutionizing the gaming industry, others wanted to connect cryptocurrencies with sports, artificial intelligence, or healthcare. I remember, for example, the Dentacoin project, a cryptocurrency that was supposed to serve as payment at the dentist. Hundreds, if not thousands, of similar projects were created.
And how did they end up? Most of them no longer exist today. Some were scams from the very beginning (so-called rug pulls), others started with good intentions but failed in execution or did not gain enough community trust. In the "better" case, the altcoin survives, but its price is many times lower than it was three or four years ago.
6. What is HODL?
Bitcoin HODL is actually a typo. In 2013, Bitcoin was going through a wild period – its price fluctuated sharply, and volatility was huge. During one significant price drop, many people started to panic and sell their Bitcoins. At that time, a post appeared on the Bitcointalk forum by a user named GameKyuubi titled: "I AM HODLING".
It was a simple grammatical error – the author later admitted he was drunk and made a mistake. In the text itself, he explained that he didn't intend to sell anything, even though the market was falling – he was simply holding his coins. The community fell in love with this mistake instantly. From it, a cult phrase was born, which gradually turned into the HODL philosophy. Today, HODL means holding Bitcoin regardless of price fluctuations. It is synonymous with long-term investing regardless of what Bitcoin's price is today, tomorrow, or in a year. The vision that Bitcoin represents is what matters. No matter how volatile Bitcoin is, from a long-term perspective, its price is constantly rising.
7. Is Bitcoin Eco-Unfriendly?
In my opinion, this is one of the most common myths and at the same time one of the most misunderstood arguments against Bitcoin. In the media, you often read that Bitcoin consumes an extreme amount of energy, while this information is often presented without context or comparison to other industries.
Yes, it is true that Bitcoin miners consume a large amount of electrical energy. Estimates say that this consumption may be comparable to the electricity consumption of the entire Slovakia, Czech Republic, Austria, or even some sources compare it to the total energy consumption of Australia.
But that's not all. Energy consumption itself is not the problem – what matters is the source of energy used and what that consumption brings to society. Bitcoin miners naturally try to maximize profit, mainly by reducing electricity costs. That is why more and more companies are switching to renewable and otherwise unused energy sources – for example, excess gas from oil refineries that would otherwise simply be flared and pollute the atmosphere. They also use hydro, wind, and solar energy, which is surplus in certain regions and would remain unused without the possibility of effective storage. Bitcoin thus increases the efficiency of the entire energy grid.
There are even cases where mining companies themselves have invested in building green infrastructure. An example is Paraguay, where a hydroelectric plant was built with surplus energy that the country had no use for until Bitcoin miners moved to the region and began to utilize this surplus economically.
But the energy aspect is only one part of the whole story. The real problem, in my opinion, lies in our social mindset. We live in an inflationary world where money loses value, and therefore no one motivates us to save – on the contrary, we are pushed toward constant consumption. Instead of investing in quality things and building the future, we buy cheap, quickly perishable products that fill landfills and consume valuable natural resources.
Just take a few facts:
- Producing one cotton t-shirt consumes approximately 2,700 liters of water – which corresponds to the drinking water needs of one person for two and a half years.
- The textile sector was the third largest polluter of water and land use in 2020.
- The production of electronics generates an enormous amount of emissions – between 2015 and 2020 alone, according to a study from Taiwan, greenhouse gas emissions from the production of electronic components increased by 7.5% per year.
To put it simply – we consume more and more energy and raw materials to produce things we often don't even need. And all because inflation forces us to spend. Saving simply "doesn't pay off." I mentioned the HODL philosophy. Bitcoin's value grows over time, so it naturally motivates you to consider every purchase. Suddenly, you think three times whether to buy another useless t-shirt, a new mobile phone, or a car you don't need.
Let's imagine a simple scenario: Would you buy expensive designer clothing if you knew that the same money would be worth twice as much in a few years? Maybe yes – but with much more thinking. And it is this thinking that is key. In my opinion, Bitcoin teaches people responsibility, respect for money, and naturally leads to a reduction in unnecessary consumption. Not because it forbids, but because it motivates. In this, I see one of the greatest positive ecological impacts of Bitcoin – it changes the mentality. It teaches us that saving makes sense. And that is something that the current inflationary system has long suppressed.
8. Can Bitcoin Function Without the Internet?
"If the internet goes down worldwide, Bitcoin will vanish!" This claim occasionally appears, but if we took it literally, most of our modern world would also vanish. Without the internet, mobile applications, internet banking, e-shops, cloud services, online maps, streaming platforms, social networks, most government services, and even many common payment terminals in stores would stop working.
Companies wouldn't be able to communicate with customers, most businesses would grind to a halt – even public transport in large cities would have serious problems. Simply put: if the internet goes down globally and long-term, we have a much bigger problem than just Bitcoin.
However, let's hypothetically imagine such a catastrophic scenario. Can Bitcoin function without the internet? In certain cases, yes, although it is significantly more complex and requires special solutions. The Bitcoin network was designed to be resilient, decentralized, and available even in extreme conditions.
Satellite Connection (Blockstream Satellite)
The company Blockstream operates a satellite network that broadcasts the entire Bitcoin blockchain to space and back to Earth. A user can thus download and monitor the blockchain without an internet connection; all they need is a satellite dish, cheap hardware, and a power supply. Although it is not possible to directly send transactions via satellite, it is still possible to maintain an up-to-date database of the Bitcoin network.
Radio Frequency and Mesh Networks
Transactions can also be transmitted using radio waves. Some communities are testing so-called mesh networks – local connections of multiple devices without the internet.
SMS and WAP Networks
As we mentioned in another chapter, the Machankura project was created in Africa, which allows sending Bitcoin using common feature phones.
It should be added, however, that these solutions are intended more for extreme cases – such as a local internet outage, during a war conflict, or in authoritarian regimes that restrict access to free information and finance. Bitcoin offers a way out in these situations. If the internet fails only locally or temporarily, the network can continue synchronizing and updating without major problems after reconnecting. But if the internet went out completely and long-term worldwide, the entire financial system, state institutions, and daily life as we know it would likely collapse. Bitcoin would suffer, but it is designed so that after the connection is restored, it could continue – which cannot be said for most other systems.