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Yes, but when my bank fails, the government backing that paper will pay up the deposit up to €50k... if the government is strong well there you go... Ask MtGox

Yes, but when my bank fails, the government backing that paper will pay up the deposit up to €50k... if the government is strong well there you go... Ask MtGox users what happened with their "currency"... and it's not even a big case in terms of amount of money gone. The thing is, yesterday I sent USD from US bank to UK and received it in less than 30 seconds paying less than 1% in total on fees (including FX), using Transferwise. Coinbase wants to charge me 4% and will take its time... A month ago I made a typo when making a transfer. The money bounced back in 3 days. Try sending BTC to your ETH wallet and see what happens. The problem that cryptocurrencies solve can and is being solved because the technology is at that level now so it's possible. Yeah banks suck, we need new, better banks. Transfers suck, we need more like Transferwise. Blockchain is a different story though...

DennisP 9y ago
Ask the central bank of Bangladesh what happened with theirs. http://thehackernews.com/2016/03/bank-hacking-malware.html http://thehackernews.com/2016/03/bank-hacking-malware.html
- zanny 9y ago
  The point isn't that having the central bank backing makes fiat infallible, it is that people will trust a private bank with the backing of a government controlling an economy on the scale of the US more than something without any guarantees at all. Of course, with bitcoin, ether, and fiat, you don't need a bank. You can always keep your money yourself. Except with bitcoin and ether the ability to secure your own money is much more attainable for average people. On the flip side, a lot of people conflate trust in web exchanges or bitcoin banks with the stability of the currency itself. Isolated, you have a reason to trust bitcoin way more than any state actor - its math, codified, and nobody can erase it now. On the other hand, state actors have force of violence if anyone breaks the money. If someone breaks bitcoin with an exploit in the blockchain, you are screwed without recourse. At this point, with the amount of participation it has, the bitcoin protocol should be considered robust - but that also is what translates into its valuation. It is only worth so much because it is proven through its long years of use.
  - Frogolocalypse 9y ago
    > people will trust a private bank with the backing of a government Clearly reality is not agreeing with this assessment? As an example of this counter-argumemt : bitcoin.
    - zanny 9y ago
      Bitcoin is a 42B market. Thats a third the market cap of... McDonalds. In a global economy of some 64 trillion, 42 billion (plus the gold and other precious metals, and many other "lack of faith" stores of wealth) is not even a drop in the bucket. And even at that, you don't have to have no faith in established currencies to also use bitcoin. I personally don't think the banking system in power now will fail any time soon, but I also can recognize how valuable a cryptocurrency would be to replace it.
      - Frogolocalypse 9y ago
        What does any of that to do with your argument that people won't do something that they clearly are doing?
        zanny 9y ago
        That the people developing bitcoin and the people investing in it can have faith in the currently popular monetary systems while also investing in bitcoin. The presence or popularity of bitcoin does not imply an objective amount of lost faith in fiat currencies.
        Frogolocalypse 9y ago
        > The presence or popularity of bitcoin does not imply an objective amount of lost faith in fiat currencies. 'Objective amount'? What it is is an amount, and growing, that feel exactly what you imply doesn't exist. There are clearly many people that have lost 'faith' in fiat currencies, or the central banks that manage them, or the economies behind them, or all of these things, to the tune of the market-cap of bitcoin. How more objective an amount can you get than that?
AndrewBissell 9y ago
> Yes, but when my bank fails, the government backing that paper will pay up the deposit up to €50k... if the government is strong well there you go... Eh, yeah, good luck with this. Maybe ask the citizens of Cyprus how trusting their government's promise to pay out in full on their bank accounts worked out. The US banking system is now hugely concentrated, with a huge pile of leveraged derivatives bets being pyramided on top of depositor money. When this unravels in spectacular fashion, the choice will be to print a massive amount of new USD to paper over depositors' losses, or bail-ins. Either one will accelerate adoption of BTC to escape the depredations of fiat currencies controlled by gov't backed banking cartels.
LMYahooTFY 9y ago
MtGox was a central bank and possibly just a giant case of fraud that people fell for, how is it relevant? Coinbase is FDIC insured and has insurance for Crypto holdings? Don't use exchanges if you don't like them?
- AlexCoventry 9y ago
  Who insures coinbase's cryptocurrency?
  - LMYahooTFY 9y ago
    It's done through Lloyd's, so many different companies in a risk pool.

DennisP 9y ago

Ask the central bank of Bangladesh what happened with theirs. http://thehackernews.com/2016/03/bank-hacking-malware.html http://thehackernews.com/2016/03/bank-hacking-malware.html

zanny 9y ago
The point isn't that having the central bank backing makes fiat infallible, it is that people will trust a private bank with the backing of a government controlling an economy on the scale of the US more than something without any guarantees at all. Of course, with bitcoin, ether, and fiat, you don't need a bank. You can always keep your money yourself. Except with bitcoin and ether the ability to secure your own money is much more attainable for average people. On the flip side, a lot of people conflate trust in web exchanges or bitcoin banks with the stability of the currency itself. Isolated, you have a reason to trust bitcoin way more than any state actor - its math, codified, and nobody can erase it now. On the other hand, state actors have force of violence if anyone breaks the money. If someone breaks bitcoin with an exploit in the blockchain, you are screwed without recourse. At this point, with the amount of participation it has, the bitcoin protocol should be considered robust - but that also is what translates into its valuation. It is only worth so much because it is proven through its long years of use.
- Frogolocalypse 9y ago
  > people will trust a private bank with the backing of a government Clearly reality is not agreeing with this assessment? As an example of this counter-argumemt : bitcoin.
  - zanny 9y ago
    Bitcoin is a 42B market. Thats a third the market cap of... McDonalds. In a global economy of some 64 trillion, 42 billion (plus the gold and other precious metals, and many other "lack of faith" stores of wealth) is not even a drop in the bucket. And even at that, you don't have to have no faith in established currencies to also use bitcoin. I personally don't think the banking system in power now will fail any time soon, but I also can recognize how valuable a cryptocurrency would be to replace it.
    - Frogolocalypse 9y ago
      What does any of that to do with your argument that people won't do something that they clearly are doing?
      - zanny 9y ago
        That the people developing bitcoin and the people investing in it can have faith in the currently popular monetary systems while also investing in bitcoin. The presence or popularity of bitcoin does not imply an objective amount of lost faith in fiat currencies.
        Frogolocalypse 9y ago
        > The presence or popularity of bitcoin does not imply an objective amount of lost faith in fiat currencies. 'Objective amount'? What it is is an amount, and growing, that feel exactly what you imply doesn't exist. There are clearly many people that have lost 'faith' in fiat currencies, or the central banks that manage them, or the economies behind them, or all of these things, to the tune of the market-cap of bitcoin. How more objective an amount can you get than that?

AndrewBissell 9y ago

> Yes, but when my bank fails, the government backing that paper will pay up the deposit up to €50k... if the government is strong well there you go... Eh, yeah, good luck with this. Maybe ask the citizens of Cyprus how trusting their government's promise to pay out in full on their bank accounts worked out. The US banking system is now hugely concentrated, with a huge pile of leveraged derivatives bets being pyramided on top of depositor money. When this unravels in spectacular fashion, the choice will be to print a massive amount of new USD to paper over depositors' losses, or bail-ins. Either one will accelerate adoption of BTC to escape the depredations of fiat currencies controlled by gov't backed banking cartels.

LMYahooTFY 9y ago

MtGox was a central bank and possibly just a giant case of fraud that people fell for, how is it relevant? Coinbase is FDIC insured and has insurance for Crypto holdings? Don't use exchanges if you don't like them?

AlexCoventry 9y ago
Who insures coinbase's cryptocurrency?
- LMYahooTFY 9y ago
  It's done through Lloyd's, so many different companies in a risk pool.