It’s interesting from a technological point of view. We’re in a world where the payments system is evolving quickly and new approaches to managing payments are proliferating, and some of the ideas around bitcoin will no doubt be useful in doing that.-RW
But I think bitcoin itself has some serious problems. The first is that it hasn’t shown to be a stable source of value. Its price has been highly volatile and it hasn’t yet established itself as a widely accepted transactions medium.
But the real serious problem that it has is it’s anonymity, which is a feature, and is also a bug, in that it has become in some cases a vehicle for illicit transactions, drug selling or terrorist financing or whatever. And you know, governments are not happy to let that activity happen, so I suspect that there will be oversight of transactions done in bitcoin or similar currencies and that will reduce the appeal.
Saturday, November 21, 2015
Bernanke on Bitcoin: It Has Serious Problems
Former Federal Reserve Chairman Ben Bernanke provides his view on Bitcoin. From an interview with Quartz:
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Oh yeah Bernanke is sooooo right. Unlike cash, gold or silver which apparently is traceable, bitcoin has anonymity which despite the banks laundering hundreds of billions of dollars for drug lords, terrorism (as though anyone with two functioning brain cells doesn't know who funded ISIS, Al-Queda, Contras, etc). We don't want to encourage illicit behaviour!?! You cannot make this stuff up!
ReplyDeleteWhat's truly amusing is your continued diatribe against bitcoin. Let me sum up your view. Bitcoin will fail because the government (i.e. US, EU, Zimbabwe, Argentina, etc) will regulate it out of existence like it has say, gold, silver which of course NO ONE uses as a means of storing and retaining wealth. Or maybe you can provide a clear example of what government has managed to legislate or regulate a currency out of existence when the public have wanted to use it as a means of exchange??? And the rest of your argument is bitcoin is volatile compared to the "stability" especially in terms of purchasing power of currencies like the dollar, euro, yuan, ruble because countering every austrian argument on the planet, printing money ad infinitum leads to "stability" and a currency whose supply is limited leads to volatility!?! Yes Robert, you've shown yourself to be a REAL GENIUS. A true asset to the Austrian economic cause!
In 1933, FDR banned gold ownership for U.S. citizens. Millions of gold coins were confiscated and melted down. The ban lasted for 42 years, until 1975.
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