4 ms·

No, it isn't. Cryptocurrencies in this aspect are the same as the fiat money you and I use today. The problem was everyone deciding to brand Bitcoin as an inve

No, it isn't. Cryptocurrencies in this aspect are the same as the fiat money you and I use today. The problem was everyone deciding to brand Bitcoin as an investment vehicle instead of as a currency. Cryptocurrencies are money. The benefits are immediately realizable. If I gave you $5 in exchange for a service worth more than $10, promising that due to market forces that $5 would soon have the buying power of $10, you would laugh in my face and demand the $10 immediately, not later. Yet somehow we decided this was OK to do with crypto. It has to do with a lack of knowledge, partially due to world governments initially being hostile towards crypto and then indifferent. Were this technology correctly introduced to society by trusted parties with regulated information, we wouldn't be having this conversation about whether or not cryptocurrency is flawed due to an inherent volatility that comes with low market adoption.

JumpCrisscross 8y ago
> Were this technology correctly introduced to society by trusted parties ...it would be fundamentally outperformed by said trusted party producing a database.
mikekchar 8y ago
I wonder if you are actually disagreeing. One of the biggest problems with BTC, in particular, is that it is inherently deflationary. This encourages the thinking that its value will inevitably rise. BTC was originally popular with people who also thought that it was a good idea to buy up and hold gold and silver. BTC solved an actual financial problem, though. There was a desire to make distributed financial transactions. The most obvious application was to make purchases where moving the money through central, regulated banks was undesirable (e.g. buying drugs or money laundering). However, there were other applications as well. For my part, although I've never actually spent any BTC (I have a small amount that I actually mined with my CPU, if you can believe it!), the attraction was the possibility to make payments online because as non-permanent resident foreigner, every credit card company refused my business. It's slightly easier to get a credit card now, but I still don't have one. In other places in the world, the banks are corrupt. My friend's wife had her employer pay her with BTC because she would be sure to actually receive payment. In some places, depending on who you are it is literally impossible to get a bank account. This is a form of marginalisation and discrimination. BTC (or something like it) can solve this problem, presuming you can find a way to convert it to fiat currency. But the problem here is that despite the potential (or even because of it) the field is littered with fraud. The banks do not want a distributed payment processing system. They want to be in control. Especially in countries where they are abusing the customers, or actively marginalising parts of the population -- it's not an accident. They don't want to fix the "problem". So the existing regulated industry wants no part of cryptocurrency (at least from the perspective of an actual decentralised payment processing system that removes control from them). This creates the vacuum that attracts the fraud. It also makes the adoption for beneficial transactions (e.g. not drugs and money laundering) very difficult because legitimate vendors have to adhere to the regulated system and cryptocurrency does nothing to make that easier. At best it doesn't make it harder. As many cryptocurrency nouveau-riche can identify with, figuring out how to pay your taxes with the capital gains/losses from FOREX is not trivial. While I'm hopeful that a distributed payment solution will eventually arise, I think the OP's point that the pains we are experiencing are pretty much inevitable is correct. Though we could make our lives a lot easier if we used an inflationary cryptocurrency (because then you'd be forced to spend it quickly).

JumpCrisscross 8y ago

> Were this technology correctly introduced to society by trusted parties ...it would be fundamentally outperformed by said trusted party producing a database.

mikekchar 8y ago

I wonder if you are actually disagreeing. One of the biggest problems with BTC, in particular, is that it is inherently deflationary. This encourages the thinking that its value will inevitably rise. BTC was originally popular with people who also thought that it was a good idea to buy up and hold gold and silver. BTC solved an actual financial problem, though. There was a desire to make distributed financial transactions. The most obvious application was to make purchases where moving the money through central, regulated banks was undesirable (e.g. buying drugs or money laundering). However, there were other applications as well. For my part, although I've never actually spent any BTC (I have a small amount that I actually mined with my CPU, if you can believe it!), the attraction was the possibility to make payments online because as non-permanent resident foreigner, every credit card company refused my business. It's slightly easier to get a credit card now, but I still don't have one. In other places in the world, the banks are corrupt. My friend's wife had her employer pay her with BTC because she would be sure to actually receive payment. In some places, depending on who you are it is literally impossible to get a bank account. This is a form of marginalisation and discrimination. BTC (or something like it) can solve this problem, presuming you can find a way to convert it to fiat currency. But the problem here is that despite the potential (or even because of it) the field is littered with fraud. The banks do not want a distributed payment processing system. They want to be in control. Especially in countries where they are abusing the customers, or actively marginalising parts of the population -- it's not an accident. They don't want to fix the "problem". So the existing regulated industry wants no part of cryptocurrency (at least from the perspective of an actual decentralised payment processing system that removes control from them). This creates the vacuum that attracts the fraud. It also makes the adoption for beneficial transactions (e.g. not drugs and money laundering) very difficult because legitimate vendors have to adhere to the regulated system and cryptocurrency does nothing to make that easier. At best it doesn't make it harder. As many cryptocurrency nouveau-riche can identify with, figuring out how to pay your taxes with the capital gains/losses from FOREX is not trivial. While I'm hopeful that a distributed payment solution will eventually arise, I think the OP's point that the pains we are experiencing are pretty much inevitable is correct. Though we could make our lives a lot easier if we used an inflationary cryptocurrency (because then you'd be forced to spend it quickly).