The currency is at present attractive for two reasons. One is anonymity, which makes it suitable for tax evasion and money laundering. This will not last; authorities are already wising up. The other is pure speculation. Bitcoins are the tulips of modern times. The mania is not yet over. But the longer it lasts, the more investors are likely to be burnt.
Perhaps the door is still open for a truly anonymous currency. Whatever fills that void will prosper. And it goes without saying that it will be a crypto-currency. I look forward to that day. BTW I don't buy all this "quantum computers will render encryption useless" bunk. I see it as a big bluff seeking to dissuade the masses from learning more about encryption and using it. Whatever one may think about Kim Dotcom, his vision of a user-friendly darknet is the answer. History has shown that gov't cannot be limited and the remedy has always been to empower the masses. Look at the history of the Gutenberg Press, Papal Imprimaturs, patents, copyrights etc. The answer was widespread proliferation of presses among the masses. So too will be the answer to Central Banks and State backed "legal tender" paper money schemes. Proliferation of the means of uncontrolled anonymous transactions is the answer. Power (and anonymity) to the people!
ReplyDeleteAnother government economist/banker/bureaucrat. What would you expect him to say? Surely, you can do better than this!
ReplyDelete"Blessed are the geeks: for they shall inherit the earth."
ReplyDeleteWenzel looses credibility each time he cites obvious Keynesians in his arguments against bitcoins. The fact that Wenzel is on the same side as Krugman and Landau in the bitcoin debate says a lot about Wenzel's arguments.
ReplyDeleteRe: Libertarian News,
Delete-- Wenzel looses [sic] credibility each time he cites obvious Keynesians in his arguments against bitcoins [sic] --
Gary North has beem arguing that the current Bitcoin bubble closely resembles the tulip mania of the early 1700's, and that man is no Keynesian. Even some Keynesians can see the obvious, so what's your excuse?
"The currency is at present attractive for two reasons. One is anonymity, which makes it suitable for tax evasion and money laundering."
ReplyDeleteOK, So here's the deal. If you believe this thing is anonymous, then you need to go sit in the corner and wear a dunce cap until you regain your sanity. What'd it take to track down D. P. Roberts, two weeks?
BitCoin is a central planer's wet dream. It tracks and records everyone that touches it. If they could have figured out a way to do it with paper currency, BitCoin would never have happened.
I know that common sense is a rare commodity in this day and age, but consider that no one knows who built it, exactly how it works, how many "back doors" it has, or what it's ultimate purpose is.
Don't walk, RUN away from this monster. If you trust your financial future to a digital fiat currency, you are even dumber than those of us who trusted a paper fiat currency - and we were dumb enough for all of us.
This "thing" has all the earmarks of a centrally planned trap. All that's required is "the key" - then they own your ass. It's not open source, so no one is watching the watcher.
Danger Will Robinson, Danger Danger!
Gold, silver, and even paper dollars are far more anonymous than bitcoin. People make a big deal about how you can keep bitcoin in your head and transfer it across borders, but even here, you can also transfer gold the same way but transferring the title to gold or keeping only in your mind the location of where the gold is hidden. You don't have to transfer the physical gold itself each time. Just tell the recipient where it is hidden, or give him an encrypted document of title transfer to the gold stored in a foreign vault. Gold has developed over thousands of years. It will take at least 200+ years for bitcoin to catch up.
ReplyDeleteWhy bitcoin is not a tulip (or pet rock, or beanie baby) : Because these latter ones are tangible.
ReplyDeleteBitcoin is intangible. It is just a ledger.
If this article was a (desperate) attempt to say something negative about something new, this link will be helpful: http://www.bitcoinhatersguide.com/
Tulips, beanie babies, etc have a tangible equivalent. Bitcoin does not.
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