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Most people who read HN probably would never keep more than a thousand bucks or so in cash. Once you get a bunch of it, cash starts to feel "unsafe" and you de
by jzwinck 13y ago
Most people who read HN probably would never keep more than a thousand bucks or so in cash. Once you get a bunch of it, cash starts to feel "unsafe" and you deposit it at the bank, whereupon it becomes an obligation, a sort of "virtual currency" if you will. This "virtual currency" has various ways of being transmitted, and each way is at least somewhat reversible.
What about Bitcoin? If I have a bunch of it, can I convert it to an obligation with a reputable counterparty? One who will not store it in a form which makes it so easy to get away with, once stolen?
We can treat it like cash, but then we must wonder what we are doing piling up cash in our exchanges. Conventional exchanges do not work like this at all--there might be a good reason for that.
- jordigh 13y agoYou bring up a good point, in how most dollars are "virtual". And indeed, we have seen the same kind of "virtual" bitcoins, where exchanges traded bitcoins that didn't exist in the blockchain (Mt Gox did this for a while). Again, this sort of "virtual" currency (more technically, M2 currency), is something that you can build on top of bitcoin, and something I don't think that the bitcoin protocol itself needs to build, since we already have it. http://en.wikipedia.org/wiki/M2_%28economics%29#Empirical_measures http://en.wikipedia.org/wiki/M2_%28economics%29#Empirical_me...
- sp332 13y agoYou shouldn't keep any third-party balance of bitcoin. You can do any transaction you want from your own wallet, so there's no point putting them in a "bank." Currently, exchanges require keeping a balance, but that's not a safe thing to do. Hopefully someone will make an exchange that makes sense.