@WenzelEconomics Long time reader. Bitcoin enthusiast. What do you think about the future of crytocurrencies in general? Pushing aside BTC.
— Kingsley Edwards (@krhedwards) March 13, 2014
First, I think calling Bitcoin a crypotcurrency is a bit, pun intended, of a misnomer. As I have pointed out here at EPJ, it is more of a volatile payment system than a currency. Warren Buffett also seems to think that in essence it is a payment system (SEE: Warren Buffett Blasts Bitcoin as 'Mirage': 'Stay Away!').In the sense that some type of internet based payment system could emerge, I see that as a very strong possibility, but it won't be the volatile Bitcoin type system. It could simply develop out of PayPal or one of the other current payment systems.
As for e-payment systems being a libertarian alternative to government currencies, I believe it fails at two key points.
1. E-payments systems are very trackable. This is the exact opposite of what you would want from a libertarian system. Even tumblers that can mix coins to make them less vulnerable to source of ownership are very vulnerable. Who is to say that such tumblers can not be run or be monitored, in some cases, by governments themselves and thus result in detection by government of who is attempting to hide ownership.
2. E-payment systems are very vulnerable to government regulation at key points. Above ground, mainstream retail purchases are very vulnerable to regulation as are points where cash is turned into e-coins or vice-versa. Thus, they add to the problem that such payment systems will be regulated by government in a fashion where the users of e-coins will be known.
It is possible an underground e-payment system could develop similar to hawala, but that wouldn't make such a system the predominant method of exchange, but rather a method used to move money on special occasions, much the way hawala is used today.
I recently viewed a Robocoin Bitcoin ATM in action. This ATM does some things my ATM does not do, namely you stick your hand inside a cavity (hand sanitizer needed?) in order to allegedly have a palm print made; a copy of a govt. ID is required to be made. Wonder where all those palm prints and govt. id copies wind up? Bitcoin may have the opposite effect the anarchist advocates wish for, namely more will be known about your spending patterns than ever before, any scintilla of anonymity obliterated.
ReplyDeleteThe spectre of government laws & regulation looms over everything.
ReplyDeleteThe feds have enforced legal tender laws ruthlessly in the past and there is every reason to believe that they will try to crush every single challenger to the dollar.
I do not need to remind you that gold was essentially confiscated under Roosevelt in 1933.
So i don't know why you as a libertarian have the inevitable government opposition against Bitcoin at the center of your argument. The same line of reasoning could be used against gold and silver.
Why does Buffett's opinion matter again? His comparison of Bitcoins to checks is laughable.
ReplyDeleteA check can bounce, it can get lost in the mail, it takes a long time to cash it or to send it to someone.
Checks are inferior to Bitcoin as a payment system in almost every way.
"An automatic teller machine or ATM is a machine that allows people to take out money from my ATM"
ReplyDeletehttp://www.bitcoinmoneyatm.com
Wow you are so profoundly clueless that it boggles the mind. Not only does it meet all of the prerequisites of being a currency, but it's a programmable currency!!! That you don't see it is normal. You're the guy who thinks that you can create a special algorithm (i.e. Drudge algorithm) that proves your delusions about IP rights. Keep it coming!
ReplyDelete