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Here are some thoughts on how it could work. Not completely thought out, but something: Before we had electronic bank records, banks could print "bank notes" w

by habosa 9y ago

Here are some thoughts on how it could work. Not completely thought out, but something: Before we had electronic bank records, banks could print "bank notes" which were as good as money if you trusted the bank. Now that we have electronic records they basically "create" USD by adding a deposit to your account while only having ~10% of that actually stored away in dollars. If your account was truly in BTC they obviously couldn't just increase your balance, since it's a cryptocurrency and they can't just make something up. One option would be for banks to have their own tokens, similar to bank notes of old. All banks would accept the tokens of other banks 1:1 and convert them to BTC on demand, but it would allow expansion of the "money supply" like we have now with dollars.

baddox 9y ago
Any online site that sells bitcoins for fiat, like Coinbase, could just keep the fiat (or use it for anything other than obtaining bitcoins) and increment your bitcoin balance. Their total bitcoin holding may be less than the sum of their users’ balances, and no one would notice unlrsss there was a “run” of users attempting to withdraw bitcoins into their own real wallets. We’d probably all consider that blatant fraud.
AlexandrB 9y ago
> One option would be for banks to have their own tokens, similar to bank notes of old. All banks would accept the tokens of other banks 1:1 and convert them to BTC on demand, but it would allow expansion of the "money supply" like we have now with dollars. Why not create one big bank that can issue its own tokens that any bank will accept? We can call it a "central bank" or something. And then maybe after many years we can decouple the value of these central tokens from the value of bitcoin, instead allowing the central bank to control the total supply of tokens based on some kind of "monetary policy" to keep prices stable. Sounds good. The future of crytocurrency is bright indeed!

by habosa 9y ago

baddox 9y ago

Any online site that sells bitcoins for fiat, like Coinbase, could just keep the fiat (or use it for anything other than obtaining bitcoins) and increment your bitcoin balance. Their total bitcoin holding may be less than the sum of their users’ balances, and no one would notice unlrsss there was a “run” of users attempting to withdraw bitcoins into their own real wallets. We’d probably all consider that blatant fraud.

AlexandrB 9y ago

> One option would be for banks to have their own tokens, similar to bank notes of old. All banks would accept the tokens of other banks 1:1 and convert them to BTC on demand, but it would allow expansion of the "money supply" like we have now with dollars. Why not create one big bank that can issue its own tokens that any bank will accept? We can call it a "central bank" or something. And then maybe after many years we can decouple the value of these central tokens from the value of bitcoin, instead allowing the central bank to control the total supply of tokens based on some kind of "monetary policy" to keep prices stable. Sounds good. The future of crytocurrency is bright indeed!