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"The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but

"The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust. Banks must be trusted to hold our money and transfer it electronically, but they lend it out in waves of credit bubbles with barely a fraction in reserve. We have to trust them with our privacy, trust them not to let identity thieves drain our accounts." -Satoshi Nakamoto

wickawic 9y ago
That brings up another issue, but what about the original issue that GP brought up? If bitcoin continues to fluctuate wildly in value then it isn’t a great currency.
baby 9y ago
“Identity thieves drain our accounts” Isn’t that a US-centric issue? Was it shown that satoshi is from the US?
- irln 9y ago
  Isn't it a central bank-centric issue?
  - dlp211 9y ago
    It has nothing to do with a central bank and identity theft can be solved easily. The first thing that needs to happen is your credit profile is in a default frozen state. The second is that identity theft is treated properly as bank fraud. Poof, identity theft is nearly eradicated overnight.
  - closeparen 9y ago
    In other countries, the government provides a reasonable authenticator for personal identity; the banking system is not so easily fooled. It's not an essential property of central banking that banks will give you the money in an account, or courts will enforce a debt against someone, simply because you know some basic demographic information about the victim.
stvswn 9y ago
I think this is a useful point, but the lived experience of a lot of us is that you can sleep relatively soundly at night knowing that your salary is negotiated and paid in U.S. Dollars or Euros or other currencies that are backed by stable governments. About ten years ago I had a friend who had been convinced by blogs that we were on the path to hyperinflation. He started buying gold and silver like crazy. Back then you could read a lot of smart-sounding people who would tell you all about how the inflation apocalypse was imminent (Fed balance sheets, stimulus, etc.) I almost bought into it too, but I didn't really have any money to sink into gold and silver. Really glad in hindsight. I think Satoshi, who ever he was or is, was a brilliant engineer and cryptographer but his skepticism of fractional reserve banking and his general distrust of the financial system makes me believe that he only really dabbled in macroeconomics and banking. We should all be really, really glad that previous innovators did believe in fractional reserve banking, credit markets, and fiat currency. If you like modern life, I mean.
- dnautics 9y ago
  > We should all be really, really glad that previous innovators did believe in fractional reserve banking, credit markets, and fiat currency. If you like modern life, I mean. Was there no innovation during the free banking period of 1860-1920? I seem to recall at least one ground-breaking invention that happened during then.
  - WalterBright 9y ago
    The US economy expanded from subsistence farming in 1800 to superpower in 1914 conclusively shows that fiat money is not a requirement for that. What fiat money is good for is so the government can spend whatever it wants to without needing to tax it or balance its books. Fiat money makes financing of wars possible, for example. The notion that fiat money makes for stable financial markets is obviously false, although it is persistent.
    - deleted 9y ago
      [deleted]
    - 9y ago

wickawic 9y ago

That brings up another issue, but what about the original issue that GP brought up? If bitcoin continues to fluctuate wildly in value then it isn’t a great currency.

baby 9y ago

“Identity thieves drain our accounts” Isn’t that a US-centric issue? Was it shown that satoshi is from the US?

irln 9y ago
Isn't it a central bank-centric issue?
- dlp211 9y ago
  It has nothing to do with a central bank and identity theft can be solved easily. The first thing that needs to happen is your credit profile is in a default frozen state. The second is that identity theft is treated properly as bank fraud. Poof, identity theft is nearly eradicated overnight.
- closeparen 9y ago
  In other countries, the government provides a reasonable authenticator for personal identity; the banking system is not so easily fooled. It's not an essential property of central banking that banks will give you the money in an account, or courts will enforce a debt against someone, simply because you know some basic demographic information about the victim.

stvswn 9y ago

I think this is a useful point, but the lived experience of a lot of us is that you can sleep relatively soundly at night knowing that your salary is negotiated and paid in U.S. Dollars or Euros or other currencies that are backed by stable governments. About ten years ago I had a friend who had been convinced by blogs that we were on the path to hyperinflation. He started buying gold and silver like crazy. Back then you could read a lot of smart-sounding people who would tell you all about how the inflation apocalypse was imminent (Fed balance sheets, stimulus, etc.) I almost bought into it too, but I didn't really have any money to sink into gold and silver. Really glad in hindsight. I think Satoshi, who ever he was or is, was a brilliant engineer and cryptographer but his skepticism of fractional reserve banking and his general distrust of the financial system makes me believe that he only really dabbled in macroeconomics and banking. We should all be really, really glad that previous innovators did believe in fractional reserve banking, credit markets, and fiat currency. If you like modern life, I mean.

dnautics 9y ago
> We should all be really, really glad that previous innovators did believe in fractional reserve banking, credit markets, and fiat currency. If you like modern life, I mean. Was there no innovation during the free banking period of 1860-1920? I seem to recall at least one ground-breaking invention that happened during then.
- WalterBright 9y ago
  The US economy expanded from subsistence farming in 1800 to superpower in 1914 conclusively shows that fiat money is not a requirement for that. What fiat money is good for is so the government can spend whatever it wants to without needing to tax it or balance its books. Fiat money makes financing of wars possible, for example. The notion that fiat money makes for stable financial markets is obviously false, although it is persistent.
  - deleted 9y ago
    [deleted]
  - 9y ago