Dissection of the MoneyBox “Understanding Crypto” episode

The British Broadcasting Corporation (or BBC) remains huge in size in the UK, employing over 21,000 employees and with a revenue (mainly from an annual television licence fee charged to British households) of over £5bn.

This article takes a look at the BBC’s recent MoneyBox episode entitled “Understanding Crypto”, and how Bitcoin is presented.

At the start of the episode the presenter, Felicity Hannah, claims that they will answer as many questions on cryptocurrencies as they can and will “tell you what crypto is, and what it isn’t..”

Insofar as Bitcoin is mentioned we highlight the following transcripts (shown in red text). The commentary alongside shows 5 areas where the content lacks basic info and misdirects the audience.

Area #1 – Bitcoin as Money

Felicity Hannah (FH) – Can you give a really simple explainer of what Crypto is, and bear in mind the program has to finish at half past three.

Kate Baucherel (KB) – ha ha, absolutely, and it is true that people don’t understand it and it’s important to get a drip of what it is. So Bitcoin, so everyone has heard of Bitcoin, and that was the very first cryptocurrency and the reason it was interesting was because for the first time we had a way of recording movements of money, movements of value between people without needing a bank and somebody to keep the ledger. So the blockchain that sits under Bitcoin was the first proof that you could put in a transaction, and I’ve sent £5 to Felicity and it would be recorded, it couldn’t be changed, it would be totalled up at the end of the block and the page turned, just like an old accounting ledger. And it was this that became exciting, the idea that you could have digital money that didn’t need a bank. And then we start getting more and more and more of these currencies. And there has been a history of really risky stuff, and it’s very true that these things have been going up and down, and as the technology has been establishing itself. And we’ve been evolving now to the point where we have some very useful cryptocurrencies which are running on exactly the same principle as Bitcoin did, with this honest ledger that nobody can tamper with, and everybody can see. So that’s the basic difference between a cryptocurrency and things that we do with our banks.

Whilst this is a start, there is no mention throughout the podcast of Bitcoin’s in-built scarcity. There will only ever be 21 million Bitcoin.

Bitcoin was created as a better form of money. To quote Satoshi himself –

“The root problem with conventional currency is all the trust that’s required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve.”

Let’s look at some of the other Bitcoin basics omitted in this 30 minute program. At the time of writing –

  • Bitcoin’s market price is approximately $65,000 per bitcoin, or 1,500 satoshis (sats) per dollar (one bitcoin is made up of 100 million sats).
  • Bitcoin’s total market cap is therefore around $1.3 trillion, which despite recent price falls still places it as one of the top fifteen assets globally.
  • Bitcoin dominates the landscape of cryptoassets, encompassing nearly 60% of the entire universe in market capitalisation terms. In reality, since a huge number of cryptocurrencies lack any meaningful liquidity and can have their market capitalisation manipulated with a small number of trades, the real significance of Bitcoin is even higher than that figure suggests.
  • Since the US gave approval for Bitcoin ETFs in early 2024, the largest, IBIT, currently sits at around $50bn assets under management.

Newcomers to Bitcoin should approach it with curiosity and also a healthy scepticism. Unfortunately the omission of such basic information denies the listener the chance to consider this next question. Given that the last couple of decades have seen so much transformed – information, music, books, commerce, communications etc – into the digital realm, should we not expect to see this happen with money also? And not just digital manifestations of existing currencies, but a digitally native money whose supply and operations cannot be tampered with?

Area #2 – Bitcoin as peer to peer electronic cash

FH – ok so the big puffin book explanation is that it’s a digital currency it lives on something like the blockchain and you have a digital wallet to keep it in. There’s a lot to know – a lot of people there talked about wanting to understand it, and you need to understand that technical side, don’t you, before you invest. So how do I open a wallet, how do I actually trade it, how do you buy a cryptocurrency like Bitcoin.

KB – So you would normally start with an exchange, so an exchange would be something like for example Coinbase is a popular one in the UK. This is the place where you can put your £ in, and buy any of the cryptocurrencies that they list. But you have to be aware that it is a high risk investment. So the FCA is very very strict on who can actually do that. So there’s a lot of protection for consumers, so if you don’t know what you are doing, so if you don’t understand it you don’t pass the questions that they ask. So there is protection there as well.

FH – Well, not as much protection as other investments, but that may change which we’ll talk about in just a few minutes.

FH – Kate – how do you get your money out of a crypto investment.

KB – In exactly the same way – you always need to convert through an exchange. All of these different cryptocurrencies are running on different blockchains, it’s almost like the London underground. So you’re hopping onto the piccadilly line crypto and you have to go to kings cross to get the escalator back up to £ sterling.

We are onto statements about “Crypto” in general now. Unfortunately when it comes to Bitcoin, the above is clearly a misleading statement. Literally the title of the Bitcoin white paper is “Bitcoin: a peer to peer electronic cash system”. I understand that MoneyBox are mainly focussed on preventing consumer harm, but they are in danger of infantilising their audience. Bitcoin can easily be sent peer to peer, and increasingly for goods and services (see more below).

FH – That’s a very evocative description. Ok well some of our listeners have already been in touch to ask what the point of it is. So this is something Adam contacted us over.

Hi, Moneybox live. When crypto was first launched all those years ago, it was touted as being another form of currency not under the fiat of governments and central banks. Do we know how many genuine purchases are made with the likes of Bitcoin, or is it just a risky investment scheme with no protections.

Adam – thank you very much. Kate – he’s got a point, hasn’t he. I remember a few years ago the talk about crypto seemed to expect that it could eventually be used – it would be a breakthrough and become a spending currency. I think there was a pizza restaurant that accepted it, for a while you could put down a deposit for a Tesla with Bitocin, although now I think they are only accepting Dogecoin, which was launched as a joke. Adam’s got a point – I mean it’s not really being used as other than a speculative investment.

KB – Well, Bitcoin I would agree. Bitcoin’s a bit special, it’s a bit like Stephenson’s rocket, so it’s historical. It runs really really slowly.

If you were to pay for your coffee with Bitcoin, it would take up to an hour for that transaction to be confirmed on the ledger, by which time your coffee’s cold. It has its place in transactions, but in very very specific situations.

It’s a poor take to frame Bitcoin as Stephenson’s rocket. Bitcoin’s 10 minute block times are a deliberate feature, not a bug. They allow all the Bitcoin nodes running a copy of the Bitcoin ledger to be easily synced across the globe, and pretty much anyone with a computer and an internet connection can run a node – crucial for a decentralised form of money.

Since Bitcoin was first launched new layers of technology have been built on top of it, as explained in Nik Bhatia’s book Layered Money. Currently most significant is Bitcoin‘s layer 2 lightning network. This offers instant settlement and very low fees, and has hit over $1bn recently in monthly volumes. Just in the last few months Jack Dorsey’s Square have rolled out Bitcoin acceptance on their payment terminals using the lightning network – covering a potential 4 million merchants in the US. In the UK, Musqet offer point of sale terminals to accept both pounds and bitcoin as payment. BTC Map currently lists nearly 300 places where you can spend bitcoin in the UK.

This podcast makes zero mention of the lightning network on Bitcoin. Why not?

Regarding the coffee claim made above, Saifedean Ammous (author of one of the best known Bitcoin books The Bitcoin Standard) has commented that using on chain bitcoin for low value payments (the line taken in the podcast) is akin to flying a passenger jet to pick up a pint of milk.

There does remain a valid question of whether Bitcoin will take off as a means of payment whilst there is Capital Gains Tax (CGT) levied on spending it (moreover – the CGT rate has increased and CGT thresholds been slashed in recent years in the UK). MoneyBox should address this element directly rather than pretending the lightning network and other higher layers don‘t exist for facilitating everyday bitcoin payments.

Area #3 – Framing of Volatility

FH – Sorry – just address this – Peter says how can something be considered a currency when its value changes so quickly. It means the price of everything would change so fast.

KB – This is part of the point – so with the volatility of Bitcoin and a lot of the other cryptocurrencies – they are not used themselves as currency. They are a store of value even if they are going up and down just like shares would be, for example. But it’s more long term.

There is an important point here, which is partially addressed but would benefit from further comment. Bitcoin’s price is undoubtedly volatile in dollar terms. As the following article shows, there have been several drawdowns of over 50% in its history. Holding Bitcoin is not for the faint of heart. Alongside this though, it has been the best performing asset for 9 out of the last 12 years, as shown here. The podcast doesn’t mention this, so they miss out on starting to pose the obvious next question for anyone with curiousity. Why?

As adoption evolves, Bitcoin is best not viewed as a “get rich quick“ investment, but rather a “don’t get poor slowly” savings scheme. If you save the value of a days work in Bitcoin, noone can ever devalue that work in Bitcoin terms by printing more Bitcoin.

The best conclusion to this area is that anyone uncomfortable with the high levels of price volatility in Bitcoin should be adjusting their position size down, and/or their holding period longer.

#4 – Bitcoin/Crypto as a Ponzi or Pyramid Scheme

FH – Greg says Crypto is the world’s biggest pyramid scheme.

KB – Ha ha, erm, there have been scams because there are always scams where there’s value. So of course this tecnnology has been used by scammers.

FH – But there have also been coins that have been launched and not really gone anywhere and people have lost their money.

KB – Well there’s also stocks and shares and investments that have been launced and that have gone nowhere, and people have lost their money. This is a little bit more high profile, as there is that reputation of “ooh it’s volatile and it’s exciting my goodness” and so on. But it’s quite similar to early stage stocks and shares for example.

This is a fair response as far as it goes. It’s worth clarifying that Bitcoin doesn’t satisfy any definitions of a ponzi scheme. I’d recommend the following article that addresses this point by point.

As we have mentioned though, the dollar price is incredibly volatile, as Bitcoin is a fixed supply asset operating in an entirely free market. Its price is subject to large levels of speculation, and there are absolutely no guarantees on the levels of future adoption.

The price could drop to zero tomorrow, yet over 17 years it hasn’t. Adoption keeps rising. Why is this? The answer I think lies in Bitcoin’s monetary properties, and that it is a protocol for storing and transporting value benefitting from powerful and increasing network effects.

The issue this BBC MoneyBox episode has, though, alongside the stance of the FCA, is that by failing to mention the huge gulf in size and differing use case (for the majority of bitcoiners: a superior, scarce form of money) between Bitcoin and wider cryptocurrencies, they add to the confusion and don’t even get near considering the above question. In this podcast Bitcoin is framed as a historic relic and its dominance of the industry is ignored. In reality even the second largest crypto asset, Ethereum, sits at only around 1/5th of Bitcoin‘s size and has not made a new all time high in Bitcoin terms since 2017.

#5 – Bitcoin’s Environmental Impact

FH – Thank you. Right – Graham has emailed to say – I considered a £500 punt on Bitcoin in 2009 and could now be unbelievably rich apparently. Bitcoin didn’t even have a price throughout the entirety of 2009.

The first transaction assigning a price to it at all was on what has become known as Bitcoin pizza day on 22 May 2010. We can forgive Graham his slip, but it’s telling that noone producing this content picked this up.

He said I’m scraping along but my conscience is clear as I haven’t helped it damage the planet. I know you’re not bothered about that but please don’t ignore the subject and calculate not just crypto’s investment value but it’s colossal environmental damage.

We’re coming to the end of the program Kate, but there is a big question, it is a big concern for many people isn’t it.

KB – Yes, and it was a concern for the original bitcoin developers. We see original correspondence from back in 2009 where they are saying to each other – look if we get to the point where we have 50,000 to 100,000 people getting involved in Bitcoin, then we are going to be using a lot of energy. And so all the subsequent creations of cryptocurrency – all the subsequent blockchains have really looked very hard at how they minimise their environment impact. Bitcoin is Stephenson’s rocket in many ways, including the fact that it just sits there and burns coal. And all the rest are like HS2.

The comment about Bitcoin burning coal is needlessly emotive – Bitcoin mining only uses electricity. It seems to attract a lot of criticism for using electricity, of course, though oddly critics don’t make the same value judgements on anything else that does so. Lyn Alden does a far more even job of evaluating Bitcoin’s energy use in this article.

As she points out in this section, Bitcoin’s halving structure (where the block reward for miners gets halved every 4 years) leads to an increasingly efficient use of energy over time. Eventually the security of the network will be wholly reliant on transaction fees alone, which are a direct free market evaluation of the utility of the network.

Bitcoin has a fascinating relationship with energy, as it constitutes a global geographically agnostic buyer of electricity of last resort. The take above is especially disappointing as we’ve actually had a piece from the BBC in March 2025 exploring how Bitcoin mining incentivises the search for low cost renewable energy and can help bring electricity grids to rural locations.

No doubt the commentators here would counter that a proof of stake based cryptocurrency, like Ethereum, operates in the same way as Bitcoin but with a fraction of the energy use. Unfortunately, this is a denial the reality of what gives Bitcoin value, which is the proof of work – real world energy – that backs it. This in turn is what gives Bitcoin its superior monetary qualities and in turn its market dominance. Bitcoin is a neutral, censorship resistant ledger that noone can tamper with, and its price is an ongoing evaluation of that as a form of money by the open market. The following article may be useful to understand the difference between proof of work and proof of stake.

Conclusion

Aside from the points shown, over half the time of the episode was spent discussing the victims of what are sometimes termed pig butchering scams. Whilst this is a heartbreaking topic and becoming a bigger and bigger issue (I’d recommend Natalie Brunel’s recent podcast on the same area to understand more on them) these scams need not relate to cryptocurrency at all to be successful. They are essentially long term confidence tricks which encourage victims to send money under false pretences – the premise could also be share dealing, property etc. Admittedly, these criminals can often use cryptocurrencies, but so do a vast number of law abiding citizens.

It’s hard to provide an introduction to Bitcoin in 30 minutes, but under the guise of trying to protect listeners this BBC MoneyBox episode has misled them in a variety of the above areas – particularly in obfuscating the scale of Bitcoin given it comprises well over half of the size of the entire cryptoassets landscape. It surely falls foul of their own impartiality guidelines. They advise viewers to do their homework, but provide no suggested resource in which to do so.

For newcomers to Bitcoin I’d recommend any of the following –

Thanks to Pedro and Stokey Nakamoto for early comments on this article.

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