Jeffrey D. Sachs, university professor and director of the Center for Sustainable Development at Columbia University, writes in the Boston Globe:
It is hard to see bitcoin’s price surge as anything other than a bubble that will ultimately collapse. Bitcoin’s ostensible social function as an anonymous, nongovernmental means of payment carries big risks of its demise. And while blockchain, the platform that records bitcoin transactions, may well have staying power, there is no reason to believe it needs to rely on bitcoin for its success.-RW
Bitcoin is billed as a virtual currency that is independent of government or any other centralized authority. Its strengths are that it enables anonymous transactions and safety from taxation and confiscation by the state. Blockchain is also supposedly robust to transaction failures that can hit a centralized clearinghouse...
Bitcoin’s anonymity is also its practical weakness. Governments insist on being able to trace financial transactions. They fight tax evasion, economic crimes, and terrorism by following the money. Some governments, of course, also monitor the activities of their political foes in the same way.
Governments are not likely to give up such prerogatives easily. Many observers claim (though without much hard evidence) that bitcoin transactions are heavily directed toward human and drug trafficking, tax evasion, and other illicit activities. Whether or not that’s true, it surely could be, and will likely become the leading justification for suppressing the trade in bitcoins, threatening its long-term value...
As governments tighten their grip, bitcoin prices will most likely fall, and perhaps collapse, though the timing is impossible to judge.
Most of the trading that's drives the 750 million "market cap" of cryptos is in Asia. There are major Japanese firms that have integrated cryptos into their transactions and databases. There is a provincial government using crypto for voting registers. So some of the technology is valuable and being implemented into actual usage. One major event that know one talks about is a restart of the hot war on the Korean peninsula. That would crush cryptos. The advantage cryptos have is that there are few barriers to entry and you can easily trade with the world market. Cuts out the middlemen brokers and banks and the puppet politicians they control. So I can see why government crack down in the US would shut down most trading here, but as long as Asian markets continue to love their crypto kitties, there will continue to be active markets.
ReplyDeleteSo Napster went away, was that from regulation (asking b/c I don't know)? Now we have apple music and spotify. Bitcoin might get thwarted, but what emerges?
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