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You seem to be confused. Bitcoin doesn't require buy-in. It doesn't give any promise of a positive return. Simultaneously, you argue that "easy migration to mo

by beaner 9y ago

You seem to be confused. Bitcoin doesn't require buy-in. It doesn't give any promise of a positive return. Simultaneously, you argue that "easy migration to more advanced e-currencies" is a deficiency, even though they use the same scarcity model. The rest of your post is just ranty conjecture. If you want one thought on why digital currency has value, consider this: Currently, to send money between two people in the US, it takes 3 business days, typically costs some transaction fee, and is limited to the range of the border. It is slow, expensive, and local. But we are in the age of information. We used to have the same restrictions for paper letters. But now I can send an email to anyone in the world in seconds for no effort. It is fast, cheap, and global. Why shouldn't money be the same way? There is no incentive for traditional finance to improve its product, because regulation is so high that it is difficult for new entrants. Complexity and incompatibility is an advantage; it creates lock-in. There is no incentive for governments to improve, because full control of their local systems is exactly what they want. Fast, cheap, global money is in the interest of the people, but not the incumbents. Decentralized scarcity is what enables it. Now that it is here, why would we have 200 non-interoperable, complicated, slow local systems, when we could have one that works everywhere, according to a predictable economic model? Or a variety of economic models, that the world could choose from and watch play out against each other, not based on jurisdiction, but practicality? Like other types of information, money will flow through the path of least resistance. As crypto becomes more accessible, all of the world's money will flow into it, because it will be better. Parts of the world which have never had access to traditional financial services will leapfrog it and go straight to crypto, connecting directly to the rest of the world and taking advantage of the ability for people to be their own bank, instead of waiting for permission to connect to the old system. Anything that is just information can be made digital, and anything that is digital trends towards fast, cheap, and free. Money is an example of something that is just information, like music, movies, and news. All money will flow to digital currency in time because it is money that is built for the information age. We are at the very start of the S-curve.

JumpCrisscross 9y ago
> Currently, to send money between two people in the US, it takes 3 business days, typically costs some transaction fee, and is limited to the range of the border. It is slow, expensive, and local. I received funds via Fedwire today. It took about five minutes. Both sides’ banks waived fees on account of our account balances.
- beaner 9y ago
  It's true that some banking systems are improving in terms of speed. I don't think it's a coincidence that it's happening now that crypto has been around for 8 years, and is increasing in size. Most immediate US-based sends and receives are virtual, based on 2nd-layer systems like Venmo and PayPal, not actually moving money but updating the numbers in your account before funds land. Unfortunately for the Fed, speed and fees are not the whole story. There are still the problems of it not being global, not being private, inflating away, and not actually being owned by the people. (See the Cyprus banking haircut.) These are small factors in most people's daily lives, but are important enough at a large scale to have money flow in the direction of crypto, and as a result all money will flow towards it until everyone has these advantages.
  - grey-area 9y ago
    Since FPS (2009) in the UK Payments take seconds, not days. I'm not sure what you mean by virtual payments - all payments are entries in a ledger nowadays, they don't move physical money around. Re the Cyprus banking haircut I wouldn't be so sure you are protected from this kind of action - exchanges, developers and miners all have leverage and have already used it to fork entire currencies, and force changes on users, impose currency controls, impose local laws (KYC etc) if you want to spend and exchange the currency. I think on balance I prefer a slightly inflationary currency with low fees, few middlemen, and trusted counterparties and agencies to hold money (i.e. banks). Happy to ditch government control and our current system of money management though for deterministic inflation. I also prefer one which is not at the mercy of developers or miners, and does not attempt distributed anonymity, which places severe constraints on speed, energy usage and consistency, and did not have high fees. At present Bitcoin is completely unsuited to global trade and unlikely to improve soon. I think if you were a little more clear-eyed about the downsides of current cryptocurrencies, you'd make a would be more convincing case.
  - JumpCrisscross 9y ago
    > I don't think it's a coincidence that it's happening now that crypto has been around for 8 years, and is increasing in size Fedwire is run directly by the Federal Reserve [1]. It traces its history to the first electronic funds transfers, which started in 1915. It started doing automated transfers in the early 1980s. Until the 1980s, it was free; after that it costs between 3 and 80¢ for member banks. Almost every American bank will waive their mark-up (or even the whole fee) for accounts with over $15 to 50 thousand. Internationaly, there are numerous RTGS systems including but not limited to SWIFT, CLS, et cetera. > See the Cyprus banking haircut See the MtGox haircut. [1] https://en.wikipedia.org/wiki/Fedwire https://en.wikipedia.org/wiki/Fedwire
nkassis 9y ago
There a difference between saying digital currencies will take over vs bitcoin being the currency that takes over or others with similar flaw. As the first line of OP's post points out he's not saying every single digital currency scheme will turn out to be ponzi schemes but I think he makes some very valid points about many of them. I don't think the early digital currencies we have are going to be the right ones to fulfill the type of future you are envisioning.
- beaner 9y ago
  His first sentence is factually incorrect.
furyg3 9y ago
I just sent €3 to a friend at another bank (we're both in the Netherlands). It was there within the hour. It was also free. If I send €3 worth of bitcoin it would have taken anywhere from 1-6 hours and would have cost me around €20 to process the transaction.

by beaner 9y ago

JumpCrisscross 9y ago

> Currently, to send money between two people in the US, it takes 3 business days, typically costs some transaction fee, and is limited to the range of the border. It is slow, expensive, and local. I received funds via Fedwire today. It took about five minutes. Both sides’ banks waived fees on account of our account balances.

beaner 9y ago
It's true that some banking systems are improving in terms of speed. I don't think it's a coincidence that it's happening now that crypto has been around for 8 years, and is increasing in size. Most immediate US-based sends and receives are virtual, based on 2nd-layer systems like Venmo and PayPal, not actually moving money but updating the numbers in your account before funds land. Unfortunately for the Fed, speed and fees are not the whole story. There are still the problems of it not being global, not being private, inflating away, and not actually being owned by the people. (See the Cyprus banking haircut.) These are small factors in most people's daily lives, but are important enough at a large scale to have money flow in the direction of crypto, and as a result all money will flow towards it until everyone has these advantages.
- grey-area 9y ago
  Since FPS (2009) in the UK Payments take seconds, not days. I'm not sure what you mean by virtual payments - all payments are entries in a ledger nowadays, they don't move physical money around. Re the Cyprus banking haircut I wouldn't be so sure you are protected from this kind of action - exchanges, developers and miners all have leverage and have already used it to fork entire currencies, and force changes on users, impose currency controls, impose local laws (KYC etc) if you want to spend and exchange the currency. I think on balance I prefer a slightly inflationary currency with low fees, few middlemen, and trusted counterparties and agencies to hold money (i.e. banks). Happy to ditch government control and our current system of money management though for deterministic inflation. I also prefer one which is not at the mercy of developers or miners, and does not attempt distributed anonymity, which places severe constraints on speed, energy usage and consistency, and did not have high fees. At present Bitcoin is completely unsuited to global trade and unlikely to improve soon. I think if you were a little more clear-eyed about the downsides of current cryptocurrencies, you'd make a would be more convincing case.
- JumpCrisscross 9y ago
  > I don't think it's a coincidence that it's happening now that crypto has been around for 8 years, and is increasing in size Fedwire is run directly by the Federal Reserve [1]. It traces its history to the first electronic funds transfers, which started in 1915. It started doing automated transfers in the early 1980s. Until the 1980s, it was free; after that it costs between 3 and 80¢ for member banks. Almost every American bank will waive their mark-up (or even the whole fee) for accounts with over $15 to 50 thousand. Internationaly, there are numerous RTGS systems including but not limited to SWIFT, CLS, et cetera. > See the Cyprus banking haircut See the MtGox haircut. [1] https://en.wikipedia.org/wiki/Fedwire https://en.wikipedia.org/wiki/Fedwire

nkassis 9y ago

There a difference between saying digital currencies will take over vs bitcoin being the currency that takes over or others with similar flaw. As the first line of OP's post points out he's not saying every single digital currency scheme will turn out to be ponzi schemes but I think he makes some very valid points about many of them. I don't think the early digital currencies we have are going to be the right ones to fulfill the type of future you are envisioning.

beaner 9y ago
His first sentence is factually incorrect.

furyg3 9y ago

I just sent €3 to a friend at another bank (we're both in the Netherlands). It was there within the hour. It was also free. If I send €3 worth of bitcoin it would have taken anywhere from 1-6 hours and would have cost me around €20 to process the transaction.