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Old 5th July 2020, 09:55 AM   #634
Scopedog
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Originally Posted by Roger Ramjets View Post
Bitcoin as originally envisaged is pretty much dead. It has become just another 'asset class', buoyed up by speculators looking to make money from nothing. Nobody talks about it being used as a cash replacement anymore, because it has failed in that role. As a means of getting free from the evil government it is a double-edged sword - unstable, rife with fraud and criminal behavior, and no protection for victims (libertarians probably think that's fine, but Bitcoin won't achieve the wider adoption they yearn for without fixing these flaws).

All true, but with one big difference - oversight. Most governments have laws against abuse of their currencies, and constantly crack down on criminal activities. Fiat money becoming worthless overnight is rare, generally being the result of a failed state (which has more than just monetary problems).

Bitcoin is only backed by the 'invisible hand' which never seems to be around when you need it. Bitcoin does nothing about stopping criminal activity - it actually enables it. Bitcoin has always been far more volatile than any major currency, making it a frustrating medium of exchange (but great for speculation).

I think your 'analogy' is actually pretty close to reality. If it had just remained a currency simulator played by geeks for fun then it wouldn't be a problem. Unfortunately it was let out into the real world, where nefarious uses were found for it.

We should remember that Bitcoin (or any cryptocurrency) is not blockchain. Most of the flaws in Bitcoin would remain even it had a different carrier. Some of its flaws are the result of not considering evil intentions, others are due to not understanding how economics works. Blockchain is not responsible for any of that.

I think you are probably right - not because the result isn't blindingly obvious, but because it fits the typical libertarian anarchist's mindset. They always spout on about how governments are evil and fiat currency is doomed, but they never suggest an alternative that is properly thought out. Most seem to understand little about the realities of economics, and naively think that people will act responsibly when given the freedom to do whatever they want.

If 'Satoshi Nakamoto' really wanted Bitcoin to be the solution he talked about, you would think he would have made at least some effort to predict how it would behave. Bitcoin is highly deflationary by nature, which any economist can tell you is a bad thing. It doesn't take a genius to figure out what would happen to the price if it was widely adopted, nor to calculate the amount of electricity required. My bet is he was so enamored by his own cleverness that he didn't even bother to do the sums.
Humans, especially creative ones, don't always think through all variables or contexts and Satoshi Nakamoto was under no regulatory, moral, ethical, legal, or peer review concerns and restrictions when coding the blockchain and bitcoin program. I think Nakamoto, intentionally or unintentionally, invented a paradigm (cryptocurrency) that can now be subjected to discussions and pressures regarding regulation, morality, ethics, legality, and peer review. I think the risks from bitcoin's anarchic inception (distinct from it's almost immediate anarchic use) is primarily a risk for cryptocurrency users and traders who have very little precedent or consensus to base decisions and predictions on (distinct from the risk to people who are targets of criminal acts paid for in cryptocurrency). I think bitcoin and cryptocurrency is still it's own distinct paradigm and hasn't succeeded in expanding or influencing the fiat or 'traditional' currency paradigm. This is why I say it's evolved into a tulip bulb investment simulator.

Last edited by Scopedog; 5th July 2020 at 09:56 AM.
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