10 ms·

You can't compare Bitcoin to Visa. Visa is merely a payment sytem -- a means of transfer of money that already exists. Visa is not money. Bitcoin however is mo

You can't compare Bitcoin to Visa. Visa is merely a payment sytem -- a means of transfer of money that already exists. Visa is not money. Bitcoin however is money. As well as being a payment system. The correct comparison would be to compare the cost of Bitcoin to U.S. dollars or gold. Gold requires hundreds of dollars per ounce and untold energy to extract. U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable.

Digiconomist 9y ago
The comparison to VISA is a common one. Whether it makes sense to use BTC in a certain way ultimately depends on the user and how they're using it. But honestly, as a medium of exchange Bitcoin simply doesn't make sense in most cases.
- spiorf 9y ago
  At least until/if Ligtning networks is proved to work.
IgorPartola 9y ago
Compare it to cash and coins seems the most appropriate. How much energy does harvesting cotton, making into bills, and distributing it all over the place take? Don't forget those fun armoired trucks that have to cart it from place to place. Pennies famously cost more than $0.01 to produce because of the cost of metal. Metal that has to be dug out of the earth, trucked, smelted, trucked, stamped, trucked again.
- lemonycracket 9y ago
  This. That site is spreading FUD and fails to show the true impact (in terms of energy and lives) of the current legacy financial system. Next thing you know they will demand you register carbon credits to run a mining rig.
- hwillis 9y ago
  According to this it costs almost 21 cents to "make" a dollar of bitcoins. According to the mint's 2015 annual report[1] they made 1,114 million dollars in circulating coins at a cost of .51 cents per dollar in coins. However bills cost 4.9 cents/dollar for $1 bills and half a cent per dollar for $20 bills. So the vast majority of money is much, much cheaper than a bitcoin. [1]: https://www.usmint.gov/wordpress/wp-content/uploads/2016/06/2015AnnualReport.pdf https://www.usmint.gov/wordpress/wp-content/uploads/2016/06/...
  - IgorPartola 9y ago
    That's to make it. What about trucking it around, accounting for it, securing it, etc.?
    - rspeer 9y ago
      So many Bitcoin fans, so many "whatabouts". I would say the burden is on you to show that producing and moving cash requires ludicrous amounts of energy like Bitcoin does. It sounds unlikely.
  - acchow 9y ago
    I don't agree with the comparison to "making" coins or cash. Coins and cash actually get consumed as they degrade and/or get lost or destroyed. You need to replenish the supply. But you can circulate bitcoin forever. You need to compare transactions. How do I send you cash? You can give me an address to meet you at. We both drive our cars or take public transit there and consume some amount of energy and time to meet up. Then I give you cash. Or you could just tell me a bitcoin address to send to.
    - egypturnash 9y ago
      I can also put that cash in a sufficiently opaque and uninteresting-looking envelope, put it in the mail, and the Post Office will take over. There is time and energy cost incurred, but it is a cost already being paid. Mostly by advertising, right now, since an assortment of lawmakers have decided in their infinite wisdom that it's not something our tax dollars should be supporting any more.
- alister 9y ago
  A literal comparison to paper bills isn't quite right. A small sheet of linen/cotton paper could represent $1, $100, or hundreds of millions of dollars (eg., a stock certificate of a million shares of Apple stock). You have to compare Bitcoin to the concept of money, like U.S. dollars, but not literally the paper. A comparison to bars of gold is OK however since that is money and not a representation.
  - SamBam 9y ago
    > A comparison to bars of gold is OK however since that is money and not a representation. Bars of gold certainly are a "representation" of money. They are only worth something so long as we all say they are. (Besides the little bit of intrinsic value from electrical wiring.) If people stopped saying gold was worth anything, it wouldn't be.
- colordrops 9y ago
  Cash and coins are not a store of value and are also a fiat currency associated with a central authority. Gold is a better analogy.
  - IgorPartola 9y ago
    You can't buy a pizza with gold. You can with cash. BTC is trying to do both, and is failing as a store of value right now due to volatility though that may change.
    - colordrops 9y ago
      It's neither cash nor gold, but shares more properties with gold. And it certainly is not failing as a store of value, with a steady increase in value over an appropriate time window. Btw, you can buy pizza with gold, I guarantee someone will take your gold for pizza.
    - Tomte 9y ago
      I'm pretty confident that you will find more pizza places that would be willing to sell for gold than for bitcoin. War economy also functions on gold.
hwillis 9y ago
>The correct comparison would be to compare the cost of Bitcoin to U.S. dollars or gold. Gold requires hundreds of dollars per ounce and untold energy to extract. U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. No it isn't- the energy cost of bitcoin is ongoing and depends on the volume of transactions. Each time money changes hands, it costs energy to verify it. Comparing it to VISA or ACH makes the most sense, because those also incur ongoing costs per transaction.
- alister 9y ago
  If read the article correctly, he's including the cost of mining Bitcoin, not merely energy cost to verify a coin (which is absolutely trivial). Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. You can look at the current Bitcoin energy costs as the startup cost to establish a new gold mine or a new country with its own currency.
  - acchow 9y ago
    > Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. In that future you will still mine blocks, but there won't be any new bitcoin generated in that block. Sure, you might want to use a different word for that than "mining", but it will still have very real and significant energy.
    - tylersmith 9y ago
      "Validators" is the more generic for term what are also called miners or stakers.
  - jstanley 9y ago
    Once all bitcoin is mined, there will still be mining costs, but they'll be 100% paid by tx fees. Bitcoin will probably look extremely different by then, so most bets are off anyway.
pedrocr 9y ago
>Gold requires hundreds of dollars per ounce and untold energy to extract. The gold you trade is already almost all extracted, I doubt there's 1B$ a year in gold extraction investment but maybe there is. >U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. All currencies require a relevant economy using them to be valuable so that's not a real requirement. As for a trillion dollar military that's doubtfull. There are plenty of currencies with the market cap of Bitcoin that don't have nearly as much of a military backing them.
- moobyfrong 9y ago
  Accurate figures exist. In 2016 world gold production was 3,100 metric tons, worth US$128 billion. Above ground gold stock is something over 180,000 metric tons. New mining increases gold stock 1-2% per year, but very dependent on market conditions. Gold has double the volatility of equities with less total return than U.S. treasuries. It doesn't really belong in most people's portfolios.
jimrandomh 9y ago
> Gold requires hundreds of dollars per ounce and untold energy to extract. A valid comparison. Gold mining is spending resources to increase the amount of gold in existence, without delivering any other value. > U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. Not a valid comparison. Outside of a few relatively inexpensive activities at the US Mint and inside banks, no resources are being spent specifically on increasing the money supply. The value of the dollar is the byproduct of economic activity that exists primarily to achieve other things.
- jstanley 9y ago
  Note that bitcoin mining does not primarily exist to increase the amount of bitcoin in existence. That's just part of the incentive to mine. Bitcoin mining exists to timestamp transactions so that the network can achieve consensus on the state of the ledger. It is designed to use as much energy as possible, so as to make it expensive to cheat.
  - tylersmith 9y ago
    In fact, in the white paper it's just described as the decentralized time stamp server and that's its entire purpose. The term "blockchain" and all the hype about its magic powers came later.
- Finnucane 9y ago
  Gold is also not money, and arguably also mining it is largely a waste of resources and environmentally disastrous.
proofofstake 9y ago
> compare the cost of Bitcoin to U.S. dollars or gold All-in sustaining costs for mining an ounce of gold (worth $1,293.70) is between $1,100 and $1,200.
hypnoce 9y ago
>Bitcoin however is money. Bitcoin is not money as we think in a modern way. If you think of money a way to exchange goods then yes Bitcoin is money. Modern money (printed piece of paper labeled in currencies in its materialized form. Just a sequence of digits on your bank account) is dept. That's why currencies have interest rates (IR). It is also possible to create money out of nothing. IR and volume are adjusted according to the economy. Bitcoin is closer to a commodity in the sense that it is finite and requires work to be extracted.
- cma 9y ago
  > Bitcoin is closer to a commodity in the sense that it is finite Bitcoin could be forked in the future to become inflationary. It has no permanent rules, things can change through consensus. It isn't like gold (gold can be devalued through poeple losing faith in it, etc., but the supply of it doesn't inflate other than through discovery/mining).
  - hypnoce 9y ago
    Bitcoin can also be devaluated by lost of trust. Also the current supply of Bitcoin is through mining only. If rules are changed by a fork then you will have 2 different coins. We already saw it with bitcoin cash. Another way would be that the current consensus on Bitcoin itself changes. But that's a risk. How can people then predict such a consensus change. How risky is it to have Bitcoin since the day after the rules may change ?
leroman 9y ago
The fairer comparison would be Bitcoin vs Visa the corporation, which includes buildings, people, air-con, employee traveling for work, to begin with. Still, let's hope Bitcoin moves away from wasting energy soon.
- akvadrako 9y ago
  Bitcoin can't move away from wasting energy - the entire design is based on that aspect.
  - leroman 9y ago
    Ad discussed above, the solution may be moving from proof-of-work to a proof-of-ownership scheme which doesn't require as much power to run
    - akvadrako 9y ago
      That's not bitcoin and nobody has demonstrated that any such thing is possible.
- Taek 9y ago
  Also the courts that enforce the contracts visa makes, the FBI that chases people who commit fraud, the police and jails who enforce the decisions of the court, etc etc. Blockchains can operate without all of those.
  - davidmanescu 9y ago
    Payment systems like visa are relatively cheap to operate when being used honestly. There may be overhead when people commit fraud, but to me that seems more prudent than giving honest actors an intentionally inefficient system just to make abuse more difficult. Since I personally don't worry about centralisation and "trust", I like the idea that a system like the blockchain could be used to revolutionise payments without the need for tin foil hats and proof-of-work.
  - 9y ago
quinndupont 9y ago
Bitcoin wants to be money, but it really isn't. It fails the traditional account (originally from Jevons); see Kubát 2015 [1]; Mandjee 2015 [2]. More obviously, it is far too volatile to function like money in a normal sense, see Golumbia 2017 [3] [1] http://www.sciencedirect.com/science/article/pii/S2212567115013088 http://www.sciencedirect.com/science/article/pii/S2212567115... [2] https://litigation-essentials.lexisnexis.com/webcd/app?action=DocumentDisplay&crawlid=1&doctype=cite&docid=15+J.+Bus.+%26+Sec.+L.+157&srctype=smi&srcid=3B15&key=30d19a33ff786371af2c0e05d70354dc https://litigation-essentials.lexisnexis.com/webcd/app?actio... [3] https://motherboard.vice.com/en_us/article/xwwv83/cryptocurrencies-arent-currencies-they-arent-stocks-either https://motherboard.vice.com/en_us/article/xwwv83/cryptocurr...
- deleted 9y ago
  [deleted]
- mrb 9y ago
  And yet some people, like me, use Bitcoin to buy products and services. Your articles merely explain that Bitcoin legally is not money. But in practice it is used as money, it is seen as money, so it is money. Practice trumps theory. Also these articles fail to mention that volatility is quickly decreasing, thanks to increasing market depths: https://mobile.twitter.com/lsukernik/status/864920873718951937 https://mobile.twitter.com/lsukernik/status/8649208737189519...
  - nunyabuizness 9y ago
    Well it's pretty easy to spend an asset that's consistently increasing in value... the real test of it's utility as money is how many businesses and people have started accepting Bitcoin recently.
    - mrb 9y ago
      160k merchants, 3-6 million users. https://www.jbs.cam.ac.uk/fileadmin/user_upload/research/centres/alternative-finance/downloads/2017-global-cryptocurrency-benchmarking-study.pdf https://www.jbs.cam.ac.uk/fileadmin/user_upload/research/cen...
codecamper 9y ago
Yes. And Bitcoin, or another digital currency can do better. And will do better.
rtpg 9y ago
If it wanted to, Visa could "become a crpytocurrency" tomorrow. It could make Visabux and continue working without real changes to infrastructure. Bitcoin is a payment network with its own currency. Visa is the same thing, but the currency is linked to dollars. It is the most apt comparison.
hanniabu 9y ago
As more people use it and invest in it, the price will surely become more steady.
synchrone 9y ago
US Currency budget for 2016 was 709M USD: https://www.federalreserve.gov/foia/files/2017currency.pdf https://www.federalreserve.gov/foia/files/2017currency.pdf Ecological concerns aside, this puts a bit of a perspective on the overhead costs of maintaining a currency. Fiat currencies require a stability of power of course, which is impossible to quantify.
alkonaut 9y ago
> money that already exists What does "exist" mean? The currency exists, but the amounts transfered over visa and other systems is not related to how much physical banknotes exist. I haven't touched a banknote or coin in over a year. If they didn't exist I wouldn't have noticed. You could argue that puts me in the hands of banks and visa/mc and you'd be correct. They know more about me than I'd like. But I hope the energy cost of my transactions are pretty low. More and more stores no longer accept cash, meaning they have no transports for cash. The currency I use is not backed by a large gold reserve nor a huge military. Just a regular national bank of a small country. So visa isn't money, but a central bank, commercial banks and visa can maintain a currency without the need for a lot of physical money, and hopefully with reasonable energy use.

Digiconomist 9y ago

The comparison to VISA is a common one. Whether it makes sense to use BTC in a certain way ultimately depends on the user and how they're using it. But honestly, as a medium of exchange Bitcoin simply doesn't make sense in most cases.

spiorf 9y ago
At least until/if Ligtning networks is proved to work.

IgorPartola 9y ago

Compare it to cash and coins seems the most appropriate. How much energy does harvesting cotton, making into bills, and distributing it all over the place take? Don't forget those fun armoired trucks that have to cart it from place to place. Pennies famously cost more than $0.01 to produce because of the cost of metal. Metal that has to be dug out of the earth, trucked, smelted, trucked, stamped, trucked again.

lemonycracket 9y ago
This. That site is spreading FUD and fails to show the true impact (in terms of energy and lives) of the current legacy financial system. Next thing you know they will demand you register carbon credits to run a mining rig.
hwillis 9y ago
According to this it costs almost 21 cents to "make" a dollar of bitcoins. According to the mint's 2015 annual report[1] they made 1,114 million dollars in circulating coins at a cost of .51 cents per dollar in coins. However bills cost 4.9 cents/dollar for $1 bills and half a cent per dollar for $20 bills. So the vast majority of money is much, much cheaper than a bitcoin. [1]: https://www.usmint.gov/wordpress/wp-content/uploads/2016/06/2015AnnualReport.pdf https://www.usmint.gov/wordpress/wp-content/uploads/2016/06/...
- IgorPartola 9y ago
  That's to make it. What about trucking it around, accounting for it, securing it, etc.?
  - rspeer 9y ago
    So many Bitcoin fans, so many "whatabouts". I would say the burden is on you to show that producing and moving cash requires ludicrous amounts of energy like Bitcoin does. It sounds unlikely.
- acchow 9y ago
  I don't agree with the comparison to "making" coins or cash. Coins and cash actually get consumed as they degrade and/or get lost or destroyed. You need to replenish the supply. But you can circulate bitcoin forever. You need to compare transactions. How do I send you cash? You can give me an address to meet you at. We both drive our cars or take public transit there and consume some amount of energy and time to meet up. Then I give you cash. Or you could just tell me a bitcoin address to send to.
  - egypturnash 9y ago
    I can also put that cash in a sufficiently opaque and uninteresting-looking envelope, put it in the mail, and the Post Office will take over. There is time and energy cost incurred, but it is a cost already being paid. Mostly by advertising, right now, since an assortment of lawmakers have decided in their infinite wisdom that it's not something our tax dollars should be supporting any more.
alister 9y ago
A literal comparison to paper bills isn't quite right. A small sheet of linen/cotton paper could represent $1, $100, or hundreds of millions of dollars (eg., a stock certificate of a million shares of Apple stock). You have to compare Bitcoin to the concept of money, like U.S. dollars, but not literally the paper. A comparison to bars of gold is OK however since that is money and not a representation.
- SamBam 9y ago
  > A comparison to bars of gold is OK however since that is money and not a representation. Bars of gold certainly are a "representation" of money. They are only worth something so long as we all say they are. (Besides the little bit of intrinsic value from electrical wiring.) If people stopped saying gold was worth anything, it wouldn't be.
colordrops 9y ago
Cash and coins are not a store of value and are also a fiat currency associated with a central authority. Gold is a better analogy.
- IgorPartola 9y ago
  You can't buy a pizza with gold. You can with cash. BTC is trying to do both, and is failing as a store of value right now due to volatility though that may change.
  - colordrops 9y ago
    It's neither cash nor gold, but shares more properties with gold. And it certainly is not failing as a store of value, with a steady increase in value over an appropriate time window. Btw, you can buy pizza with gold, I guarantee someone will take your gold for pizza.
  - Tomte 9y ago
    I'm pretty confident that you will find more pizza places that would be willing to sell for gold than for bitcoin. War economy also functions on gold.

hwillis 9y ago

>The correct comparison would be to compare the cost of Bitcoin to U.S. dollars or gold. Gold requires hundreds of dollars per ounce and untold energy to extract. U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. No it isn't- the energy cost of bitcoin is ongoing and depends on the volume of transactions. Each time money changes hands, it costs energy to verify it. Comparing it to VISA or ACH makes the most sense, because those also incur ongoing costs per transaction.

alister 9y ago
If read the article correctly, he's including the cost of mining Bitcoin, not merely energy cost to verify a coin (which is absolutely trivial). Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. You can look at the current Bitcoin energy costs as the startup cost to establish a new gold mine or a new country with its own currency.
- acchow 9y ago
  > Once all Bitcoin is mined (yes, there's a built-in maximum), or it becomes prohibitively expensive to mine, there won't be any mining costs. In that future you will still mine blocks, but there won't be any new bitcoin generated in that block. Sure, you might want to use a different word for that than "mining", but it will still have very real and significant energy.
  - tylersmith 9y ago
    "Validators" is the more generic for term what are also called miners or stakers.
- jstanley 9y ago
  Once all bitcoin is mined, there will still be mining costs, but they'll be 100% paid by tx fees. Bitcoin will probably look extremely different by then, so most bets are off anyway.

pedrocr 9y ago

>Gold requires hundreds of dollars per ounce and untold energy to extract. The gold you trade is already almost all extracted, I doubt there's 1B$ a year in gold extraction investment but maybe there is. >U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. All currencies require a relevant economy using them to be valuable so that's not a real requirement. As for a trillion dollar military that's doubtfull. There are plenty of currencies with the market cap of Bitcoin that don't have nearly as much of a military backing them.

moobyfrong 9y ago
Accurate figures exist. In 2016 world gold production was 3,100 metric tons, worth US$128 billion. Above ground gold stock is something over 180,000 metric tons. New mining increases gold stock 1-2% per year, but very dependent on market conditions. Gold has double the volatility of equities with less total return than U.S. treasuries. It doesn't really belong in most people's portfolios.

jimrandomh 9y ago

> Gold requires hundreds of dollars per ounce and untold energy to extract. A valid comparison. Gold mining is spending resources to increase the amount of gold in existence, without delivering any other value. > U.S. dollars require the existence of a powerful economy and trillion dollar military to keep the currency secure and desirable. Not a valid comparison. Outside of a few relatively inexpensive activities at the US Mint and inside banks, no resources are being spent specifically on increasing the money supply. The value of the dollar is the byproduct of economic activity that exists primarily to achieve other things.

jstanley 9y ago
Note that bitcoin mining does not primarily exist to increase the amount of bitcoin in existence. That's just part of the incentive to mine. Bitcoin mining exists to timestamp transactions so that the network can achieve consensus on the state of the ledger. It is designed to use as much energy as possible, so as to make it expensive to cheat.
- tylersmith 9y ago
  In fact, in the white paper it's just described as the decentralized time stamp server and that's its entire purpose. The term "blockchain" and all the hype about its magic powers came later.
Finnucane 9y ago
Gold is also not money, and arguably also mining it is largely a waste of resources and environmentally disastrous.

proofofstake 9y ago

> compare the cost of Bitcoin to U.S. dollars or gold All-in sustaining costs for mining an ounce of gold (worth $1,293.70) is between $1,100 and $1,200.

hypnoce 9y ago

>Bitcoin however is money. Bitcoin is not money as we think in a modern way. If you think of money a way to exchange goods then yes Bitcoin is money. Modern money (printed piece of paper labeled in currencies in its materialized form. Just a sequence of digits on your bank account) is dept. That's why currencies have interest rates (IR). It is also possible to create money out of nothing. IR and volume are adjusted according to the economy. Bitcoin is closer to a commodity in the sense that it is finite and requires work to be extracted.

cma 9y ago
> Bitcoin is closer to a commodity in the sense that it is finite Bitcoin could be forked in the future to become inflationary. It has no permanent rules, things can change through consensus. It isn't like gold (gold can be devalued through poeple losing faith in it, etc., but the supply of it doesn't inflate other than through discovery/mining).
- hypnoce 9y ago
  Bitcoin can also be devaluated by lost of trust. Also the current supply of Bitcoin is through mining only. If rules are changed by a fork then you will have 2 different coins. We already saw it with bitcoin cash. Another way would be that the current consensus on Bitcoin itself changes. But that's a risk. How can people then predict such a consensus change. How risky is it to have Bitcoin since the day after the rules may change ?

leroman 9y ago

The fairer comparison would be Bitcoin vs Visa the corporation, which includes buildings, people, air-con, employee traveling for work, to begin with. Still, let's hope Bitcoin moves away from wasting energy soon.

akvadrako 9y ago
Bitcoin can't move away from wasting energy - the entire design is based on that aspect.
- leroman 9y ago
  Ad discussed above, the solution may be moving from proof-of-work to a proof-of-ownership scheme which doesn't require as much power to run
  - akvadrako 9y ago
    That's not bitcoin and nobody has demonstrated that any such thing is possible.
Taek 9y ago
Also the courts that enforce the contracts visa makes, the FBI that chases people who commit fraud, the police and jails who enforce the decisions of the court, etc etc. Blockchains can operate without all of those.
- davidmanescu 9y ago
  Payment systems like visa are relatively cheap to operate when being used honestly. There may be overhead when people commit fraud, but to me that seems more prudent than giving honest actors an intentionally inefficient system just to make abuse more difficult. Since I personally don't worry about centralisation and "trust", I like the idea that a system like the blockchain could be used to revolutionise payments without the need for tin foil hats and proof-of-work.
- 9y ago

quinndupont 9y ago

Bitcoin wants to be money, but it really isn't. It fails the traditional account (originally from Jevons); see Kubát 2015 [1]; Mandjee 2015 [2]. More obviously, it is far too volatile to function like money in a normal sense, see Golumbia 2017 [3] [1] http://www.sciencedirect.com/science/article/pii/S2212567115013088 http://www.sciencedirect.com/science/article/pii/S2212567115... [2] https://litigation-essentials.lexisnexis.com/webcd/app?action=DocumentDisplay&crawlid=1&doctype=cite&docid=15+J.+Bus.+%26+Sec.+L.+157&srctype=smi&srcid=3B15&key=30d19a33ff786371af2c0e05d70354dc https://litigation-essentials.lexisnexis.com/webcd/app?actio... [3] https://motherboard.vice.com/en_us/article/xwwv83/cryptocurrencies-arent-currencies-they-arent-stocks-either https://motherboard.vice.com/en_us/article/xwwv83/cryptocurr...

deleted 9y ago
[deleted]
mrb 9y ago
And yet some people, like me, use Bitcoin to buy products and services. Your articles merely explain that Bitcoin legally is not money. But in practice it is used as money, it is seen as money, so it is money. Practice trumps theory. Also these articles fail to mention that volatility is quickly decreasing, thanks to increasing market depths: https://mobile.twitter.com/lsukernik/status/864920873718951937 https://mobile.twitter.com/lsukernik/status/8649208737189519...
- nunyabuizness 9y ago
  Well it's pretty easy to spend an asset that's consistently increasing in value... the real test of it's utility as money is how many businesses and people have started accepting Bitcoin recently.
  - mrb 9y ago
    160k merchants, 3-6 million users. https://www.jbs.cam.ac.uk/fileadmin/user_upload/research/centres/alternative-finance/downloads/2017-global-cryptocurrency-benchmarking-study.pdf https://www.jbs.cam.ac.uk/fileadmin/user_upload/research/cen...

codecamper 9y ago

Yes. And Bitcoin, or another digital currency can do better. And will do better.

rtpg 9y ago

If it wanted to, Visa could "become a crpytocurrency" tomorrow. It could make Visabux and continue working without real changes to infrastructure. Bitcoin is a payment network with its own currency. Visa is the same thing, but the currency is linked to dollars. It is the most apt comparison.

hanniabu 9y ago

As more people use it and invest in it, the price will surely become more steady.

synchrone 9y ago

US Currency budget for 2016 was 709M USD: https://www.federalreserve.gov/foia/files/2017currency.pdf https://www.federalreserve.gov/foia/files/2017currency.pdf Ecological concerns aside, this puts a bit of a perspective on the overhead costs of maintaining a currency. Fiat currencies require a stability of power of course, which is impossible to quantify.

alkonaut 9y ago

> money that already exists What does "exist" mean? The currency exists, but the amounts transfered over visa and other systems is not related to how much physical banknotes exist. I haven't touched a banknote or coin in over a year. If they didn't exist I wouldn't have noticed. You could argue that puts me in the hands of banks and visa/mc and you'd be correct. They know more about me than I'd like. But I hope the energy cost of my transactions are pretty low. More and more stores no longer accept cash, meaning they have no transports for cash. The currency I use is not backed by a large gold reserve nor a huge military. Just a regular national bank of a small country. So visa isn't money, but a central bank, commercial banks and visa can maintain a currency without the need for a lot of physical money, and hopefully with reasonable energy use.