The part where you run in to trouble is getting governments to accept tax revenue as Bitcoin, because it undermines the national currency, making monetary policy irrelevant. And why would a country do that exactly? Why would they surrender the ability to heal their economy? Sorry to all the believers, but it’s a Libertarian pipe dream that makes absolutely no sense.
Browsing: Bitcoin Obituaries
Bitcoin is the wrong answer to a good question: what can be done to make the monetary system less crazy? . . . Bitcoin is not over yet. But the pseudo-currency is close enough to collapse to merit an early retrospective. . . . Bitcoin is neither a relatable store of value nor a helpful unit of account.
Sorry, but Bitcoin isn’t the future. If anything, it’s a throwback to an earlier era. . . . Anyone who thinks that Bitcoin will triumph has to believe that it will succeed where earlier generations of private currencies failed — that Bitcoin will, improbably, manage to overthrow more than century’s worth of accumulated state power, jealously guarded and ruthlessly enforced. That’s a preposterous fantasy — and a dangerous one, if you’re an investor.
Bitcoin is not a legitimate currency but simply a risky virtual commodity bet. . . . Bitcoin lacks the essential attributes that are needed to support a widely recognized transactional currency. If Bitcoin was allowed to proliferate as a currency it would produce greater economic uncertainty, reduced trade and lower individual standard of living.
And, in the greater scheme of things, bitcoin is small: even at a roughly 10 billion dollar market capitalization it is almost irrelevant in financial terms. This is probably roughly the peak market capitalization achieved by Beanie Babies in 1999. There are indeed important and valuable ideas that exist in bitcoin’s design. But bitcoin itself? I believe its volatility and built-in irreversibility will doom it to the ash-heap of history.
The federal reserve comes out with their own version of the bitcoin, let’s call it the “USDcoin”, they make a .001 (or some other arbitrary number) USDc the equivalent of $1 and they make it very easy to use. You can have these deposited into your existing bank account and they are immediately converted to dollars and when you send dollars out of your account they are immediately converted to USDc. Then the government also implements anti-bitcoin laws that make using bitcoin difficult or impossible to use. Of course they will claim bitcoin was being used for illegal purposes and money laundering. This will be the end of bitcoin.
But make no mistake, Bitcoin is not the currency of the future. It has no intrinsic value. . . . Bitcoin? Nada. There’s nothing keeping it being a thing. . . . Again, Bitcoin might go up a lot more before it ultimately ends. That’s the nature of bubbles. The dotcom bubble crashed a bunch of times on its way up. Then one day it ended. The same will happen with this.
In theory, bitcoin could become a lawful virtual currency if the bitcoin community gave up anonymity and therefore incorporated the identities of bitcoin senders and receivers as part of the currency. But that would eliminate the cash-like feature that makes bitcoin attractive and vastly decrease the demand for bitcoin. That does not seem like a viable path forward. . . . While I praise the sheer ingenuity of bitcoin and its payments innovation, it should be buried.