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The utility is on the name: cryptoCURRENCY. Before it became a speculative asset, crypto faced the issue of adoption, now that it is one, it faces the issue of
by sickofparadox 3y ago
The utility is on the name: cryptoCURRENCY. Before it became a speculative asset, crypto faced the issue of adoption, now that it is one, it faces the issue of not being useful as a way to facilitate transactions.
- deleted 3y ago[deleted]
- stouset 3y agoDo you think it is possible that—despite the name having the word “currency” in it—the technology might just be poorly matched to what most people expect and need from a currency? That might explain its almost complete lack of real world use as a currency outside of a few scenarios of economic collapse.
- aidenn0 3y agoIt doesn't help that the most popular cryptocurrency is intentionally deflationary. Deflationary currencies are terrible units of exchange.
- AnimalMuppet 3y agoGresham's Law: Bad money drives out good. If cryptocurrency is deflating, it's becoming more valuable with time. The dollar is inflating - it's becoming less valuable with time. So given the choice, I would pay with dollars and hold crypto. That's just normal human behavior. But while that may make crypto a good investment, it makes it a terrible unit of exchange, as you say (or at least a unit of exchange that will only be used as a last resort).
- giantrobot 3y agoBut cryptocurrencies were designed to be deflationary which makes them shitty currencies. There's no point in spending a cryptocoin today when its value will be higher tomorrow.
- jonkho 3y agoBut fiat currencies were designed to be inflationary which makes them shitty store of value. There is no point in saving in fiat today when it’s value will be lower tomorrow.
- orwin 3y agoExactly, working as intended. You want people to hold real assets, not imaginary ones like a currency, because you want people to be invested in your economy. The only intrinsic value a currency have is taxation.
- HDThoreaun 3y agoCurrencies aren't supposed to be a good store of value, just a predictable store of value. Investments are supposed to be good stores of value. The government very much does not want people hoarding currency.
- giantrobot 3y agoWe don't want people just stuffing dollars in a mattress. That doesn't help either themselves or anyone else. So we encourage putting dollars/currency into interest bearing vehicles or real assets. We don't want dollars to sit in hoards. We want them to circulate. If I can be without access to dollars for a while I can loan them to you for some enterprise. Then you pay me back more than I loaned you (and more than inflation we hope) because your enterprise created additional value. If my excess money circulates I benefit from access to the things that money is used to build in addition to the interest I receive. Since I'm not a medieval landed noble my economic value isn't measured by the productivity of the serfs on my land holdings.
- tromp 3y agoMost cryptocurrencies were designed that way, but some have a so-called tail emission making them disinflationary. One even has a completely linear emission of 1 coin per second forever since launch.
- dale_glass 3y ago
- salamanderss 3y agoThis is one of those Richard Feynman moments where perhaps it's more useful to consider the properties of the bird than its name. The technology doesn't have a soul, it's up to us to decide when and where to use it regardless of taxonomy.
- uoaei 3y agoI can call my fists "cancer-eradicating super-machines". Does that mean my fists are good at killing cancer?