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My biggest concern with the lack of underlying utility / value is does currency have any real, long-term value if there is no sovereign government willing to g

My biggest concern with the lack of underlying utility / value is does currency have any real, long-term value if there is no sovereign government willing to go to war to defend its long-term interests? Or if there's no underlying system of law to protect those that engage in it? Is the plan that sovereign governments use their resources to reinforce a currency that undermines its own?

adventured 9y ago
Since Bitcoin isn't a currency and never can be, and seeing as it's a store of value (which matches up to its profile in terms of mining difficulty, scarcity, etc), the question if you believe Bitcoin is going to actually one day be worth $3 or $5 or $8 trillion: which countries own outsized holdings of Bitcoin? The US and China to name two. Very large quantities of Bitcoin were mined & purchased in the US in the first 3-4 years of Bitcoin. And China has represented about half of all mining the last few years as the difficulty has soared.
api 9y ago
It very well might if it were useful as a currency. Hyper-deflationary token systems that not only don't scale but lose their utility when adopted are horrible currencies. The more people use a particular block chain the less utility it has because the system doesn't scale in either transaction volume or token price stability.
eeZah7Ux 9y ago
> lack of underlying utility / value is does currency have any real, long-term value if there is no sovereign government willing to go to war You just described the value in your question. A wealth store/transfer platform that does require armies to protect its "banks", as they are distributed/global, does not encourage wars.
- spookthesunset 9y ago
  > A wealth store/transfer platform that does require armies to protect its "banks", as they are distributed/global, does not encourage wars. Sure it does. It uses an insane amount of power. Wars are fought over the resources to generate that power all the time. You could argue that the governments of the world are indirectly subsidizing crypto by using war to maintain a stable source of energy. With no government around to protect the river that powers the hydro dam, or acquire the oil / coal required for the power plants, what is gonna power these blockchains? Solar? Who makes the solar panels? That requires trade... who structures that trade? Government. Sorry. Bitcoin, nor any blockchain, cannot function without the all mighty government.
  - eeZah7Ux 9y ago
    > It uses an insane amount of power. Wars are fought over the resources to generate that power all the time There has been a lot of exaggeration around the amount of power used for mining. It's less that the energy used to run Google, Facebook, and many industrial applications and certainly not remotely comparable to the bulk of oil consumption in 1st world countries. (Don't get me wrong: I'm not a fan of Bitcoin and I don't use cryptocurrencies.) > You could argue that the governments of the world are indirectly subsidizing crypto by using war to maintain a stable source of energy. > Sorry. Bitcoin, nor any blockchain, cannot function without the all mighty government. This is a complete strawman. You just conflated the efforts being spent by countries to protect their entire wealth including stocks, gold, fiat money, derivatives with the efforts to access energy sources.

adventured 9y ago

Since Bitcoin isn't a currency and never can be, and seeing as it's a store of value (which matches up to its profile in terms of mining difficulty, scarcity, etc), the question if you believe Bitcoin is going to actually one day be worth $3 or $5 or $8 trillion: which countries own outsized holdings of Bitcoin? The US and China to name two. Very large quantities of Bitcoin were mined & purchased in the US in the first 3-4 years of Bitcoin. And China has represented about half of all mining the last few years as the difficulty has soared.

api 9y ago

It very well might if it were useful as a currency. Hyper-deflationary token systems that not only don't scale but lose their utility when adopted are horrible currencies. The more people use a particular block chain the less utility it has because the system doesn't scale in either transaction volume or token price stability.

eeZah7Ux 9y ago

> lack of underlying utility / value is does currency have any real, long-term value if there is no sovereign government willing to go to war You just described the value in your question. A wealth store/transfer platform that does require armies to protect its "banks", as they are distributed/global, does not encourage wars.

spookthesunset 9y ago
> A wealth store/transfer platform that does require armies to protect its "banks", as they are distributed/global, does not encourage wars. Sure it does. It uses an insane amount of power. Wars are fought over the resources to generate that power all the time. You could argue that the governments of the world are indirectly subsidizing crypto by using war to maintain a stable source of energy. With no government around to protect the river that powers the hydro dam, or acquire the oil / coal required for the power plants, what is gonna power these blockchains? Solar? Who makes the solar panels? That requires trade... who structures that trade? Government. Sorry. Bitcoin, nor any blockchain, cannot function without the all mighty government.
- eeZah7Ux 9y ago
  > It uses an insane amount of power. Wars are fought over the resources to generate that power all the time There has been a lot of exaggeration around the amount of power used for mining. It's less that the energy used to run Google, Facebook, and many industrial applications and certainly not remotely comparable to the bulk of oil consumption in 1st world countries. (Don't get me wrong: I'm not a fan of Bitcoin and I don't use cryptocurrencies.) > You could argue that the governments of the world are indirectly subsidizing crypto by using war to maintain a stable source of energy. > Sorry. Bitcoin, nor any blockchain, cannot function without the all mighty government. This is a complete strawman. You just conflated the efforts being spent by countries to protect their entire wealth including stocks, gold, fiat money, derivatives with the efforts to access energy sources.