If these societal constructs fail what good are they?
Don't get me wrong, I think they're all probably decent as investments, buy they're a completely different asset class.
I put BTC in the Gold/Silver category in that it can be a hedge against societal issues. In this particular moment, I see BTC as a hedge against the ongoing de-dollarization and eventual inflation or plain lack of purchasing power that could cause.
I also see it as a means of censorship resistance.
Further BTC or any sufficiently distributed money is a way to limit bank/government power since they actually have to tax instead of minting new money.
Money serves a specific purpose, it's an exchange medium. BTC is a digital asset, as an exchange medium _has already failed_.
Additionally, having the FED controlling rates is a democratic, reasoned approach. BTC is not handled by a known, government controlled authority. I know that many BTC proponents don't like governments for $reasons but BTC _liberal_ alternative is more akin to a jungle than a civilised society :-)
Personally I am pulling back on the inflation claim. Im not sure that the claim that bitcoin is an inflation hedge is accurate. Or at least I haven't investigated it enough to continue advocating that claim.
I'm also not sure that bitcoin does shield wealth from government, at least in the US it doesn't. It certainly does a better job if your government is not the US. The other two claims I agree with.
To me the utility of btc is simple. It's the ability to opt into a different and codified monetary policy. That policy is collectively securitized. If I don't agree with the monetary policy of a or any government I can opt I to a system outside of that. Imo this serves as competition to centralized banking.
How is a currency backstopped by nothing going to be superior? Volatility? It won't have the same exposure to the source of volatility to which national currencies are succeptable? Presumably it wouldn't be encumbered by an obligation to provide for the welfare of its constiuents. But in that sense, the burdens of a citizenry also translate into a valuable commodity which can be leveraged in the form of labor.
Just spitballing here. It's a very interesting thought exercise.
No person or entity can affect the money supply so the only governance function would presumably be
This seems very murky. It's utility as a currency of last resort seems uncertain and therefore relatively weak. Considering it would have to serve as a source of stability in a time of volatility which is itself a highly uncertain proposition.
To my mind, seems likely BTC is being used by the super-wealthy (persons and fictitious entities, i.e. corporations) to avoid taxes and to pay bribes.
This is not about incentives to spend or invest - it's about having a functioning basic unit of economic measure that is 1) stable 2) has integrity and 3) hopefully under the control over the government.
BTC isn't good for any of that.
USD is good for 1 and 2.
The gov. can move to re-establish it's currency and have 3 as well.
You seem to not understand the potential benefits of widely adopted censorship-resistant (decentralized) currency.
Try living in Argentina where the government is inflating your currency, while prohibiting you from moving your assets to USD. Try living in China where the government will seize your bank account if you are a business deemed too successful and if they deem they need a share of your profits. Etc.
I don't think I'm mainstream at all (anti-social, anti-copyright, my preferred political parties can never seem to get elected, ...) but I can't get behind Bitcoin for a few reasons... The biggest being the pyramid-scheme-like distribution of coins slanted towards early adopters. I want an un-regulatable digital currency too, but I can't get excited about trading one financial plutocracy for another when money is tantamount to voting power. Money is just an IOU; money doesn't need to be scarce (like gold), just enforceable (legal tender). If Bitcoin's enforcebility depends on it's exchange with other currencies that have the power/threat of governments and militaries behind them, what ground has been gained?
I think Bitcoin would be a good fit for transferring value between large entities (governments, banks, etc.), where having public accountability would be especially valuable. Those entities could then exchange it with other lower-valued cryptocurrencies, fiat currencies, precious metals, seashells, etc. more suitable for day-to-day consumption by the general public.
a highly liquid store of value that cannot easily be controlled by a central authority gold already does that, but governments or markets pick one.
It's pretty hard to run a stable empire when economic exchange breaks down. Currency's break down as society breaks down not the other way around because currency's value is propped up by the need to pay taxes or loans in that currency. Country's that try to spend more than they take in in taxes or loans devalue there currency other than that there surprisingly stable.
Do you believe more in your government The US government is increadably well run when compared to just about every government throughout history. While it's politically useful to suggest otherwise there is a reason per capita GDP is so high and our well run government is a large part of that. Now that's not to knock bitcoins but your comparing it to something with a 99.99+% chance of being around next year and that's a tough act to follow when a single bug could kill bitcoin in a few seconds. Granted the odds are much worse 20 years out, but you get time to move currency around in most failure modes, were again bitcoins can hit zero with Zero warning or just lose 90% of it's value with a mid sized sell off.
Think for a second and you'll reach the conclusion that currency monopolies (meaning: you can only use a given currency in a "country"), taxation and populism (a side-effect of democracy) are interlinked.
As for the "what's needed" for social justice, that's your opinion. It might even be the "majority's" opinion. But what if I don't agree? Will you still impose taxation through force on me to fund your ideas?
Anyway, my best advice for you is to not hold crappy bitcoin (and/or gold/silver), and keep your wealth in US dollars (or whichever other fiat currency). I guarantee you won't regret that strategy in 2-5 years.
I am not a proponent of crypto currency by any stretch, but I disagree with this. The fact that BTC has dollar value simply indicates that BTC can't be spent everywhere the dollar can. IMO the real failure of BTC is runaway deflation, which leads to it being an "investment" relative to fiat currencies.
Your currency use cases sound fine to me. The wealth ones however look dangerous to me.
>Crypto could be the biggest store of value. The beautiful math behind bitcoin (and others) is self-limiting creating real scarcity. With mass adoption will come stability.
Currencies should never be used to store value. No one should hold large amounts of wealth in Euros or Dollars and almost no one does. You hold wealth in actual productive assets like land, stocks, bonds, etc. That we price these in Euros or Dollars is irrelevant and we can price them in Bitcoin just as well. Nothing the central banks that control fiat currencies do changes the underlying worth of these assets even if they can generate temporary valuation swings.
>Crypto could become the "people's" wealth vault, and undercut nations ability to tax & control markets by truly privatizing wealth. All it takes is MOST of us to decide.
This to me sounds even riskier. People shouldn't be going out and buying bitcoin to do any of this when there are plentiful cheap instruments out there to actually invest in assets. Go buy ETFs of broadly diversified asset classes (stocks and bonds would suffice but real estate ones also exist) and leave the innovation in crypto currencies to sort itself out.
It is hard not to interpret this as posturing to head off any wise ideas by the only country in a dire enough situation to be swayed by it. Normalizing BTC or other cryptoassets as a transactional currency rather than an asset reframes the way it is treated tax-wise, another interpretation is that it threatens their power structure, which one could imagine challenges the IMF's business model as they're a cooperative of entities focusing on guiding how money is used, distributed, managed, and created. Those controls become hard to enforce on Bitcoin or other cryptoassets when it goes from asset class to transactional class.
good points. something else to consider - money derives its value from 2 sources: 1) the actual goods and services (GDP) that it represents and 2) the fact that government demands taxes be paid in it. BTC fills neither of these because no government does business with it and no one knows what it represents because it's not linked to a specific country or region of people. that alone should disqualify it from being considered "real money". until that changes, that should be everyone's view of it.
one other thing - with regards to fiat, BTC does have one theoretical advantage - the ability to limit government spending because it cannot be created out of thin air to be created as credit and spent as debt. and that is why no government will ever use it. but we wouldn't want this anyway because we actually DO want government to be able to create money as needed. the reason is that because the stated goal of the fed is "stable prices and full employment" stable prices are simple - your monetary supply expands AND CONTRACTS with GDP, pure and simple. 100 bushels of wheat in your economy and $200 in money? that's $2 per bushel. if your economy doubles due to additional population or technological/productivity improvements and starts producing 150 bushels, you need to have $300 in your economy for stable prices. the issue is that our government increases its spending at a rate that far exceeds the growth of GDP.
I think most people view Bitcoin as digital gold nowadays. (with the added benefit that the supply is known) I would not use it for short term cash needs, but from a long term store of value it has provided real benefit over a 10 year period. If the monetary supply is going to be dramatically expanded by the Fed, then it is a great way to hedge against the dollar. Couple that with the recession and the likelihood that the effects of the global pandemic is seemingly going to be here for a while, I can't think of a better place to put my money right now.
Your comment sort of works against BTC, because it was intentionally crippled. But there are many other coins that will do just fine for day to day transactions.
But also the premise of your argument (taxes and oil) is weak. The value of these transactions pales in comparison with the rest of the transactions. So government enforcement has little to do with the value of USD. It has value, because people believe it, they trust it will be accepted and / or easily converted to the currency of their choice.
BTC also could be useful as a hedge against other assets, for example the stock market or the currency you save in. I view it as a possible hedge against the Euro. This is the currency I daily use, but I definitely keep the Greek Debt Crisis in mind.
"Systems" are irrelevant to the discussion of crypto-currencies. No nation ever will have an economy based on BTC. The halfway argument (if a BTC-based economy would be bad, economies exposed to some BTC would be sort-of bad) doesn't work, either: the global economy has survived many other assets that appreciated in value.
Don't get me wrong, I think they're all probably decent as investments, buy they're a completely different asset class.
I put BTC in the Gold/Silver category in that it can be a hedge against societal issues. In this particular moment, I see BTC as a hedge against the ongoing de-dollarization and eventual inflation or plain lack of purchasing power that could cause.
I also see it as a means of censorship resistance.
Further BTC or any sufficiently distributed money is a way to limit bank/government power since they actually have to tax instead of minting new money.
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