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Is anybody worried about the terrible consequences if Bitcoin does succeed? It will be a like putting the world back on the gold standard, except with even less

Is anybody worried about the terrible consequences if Bitcoin does succeed? It will be a like putting the world back on the gold standard, except with even less inflation! Is anger at online transaction fees worth destroying the world economy?

JoeAltmaier 12y ago
I'm worried as you are. That silicon valley snobs will ignore a thousand years of learning, just to spite 'the man'. We've seen abominable cheating, lying and abuses in virtual currency systems - that surpass anything physical currency systems have experienced, in that they happen at the speed of the internet if nothing else.
- aminok 12y ago
  I don't believe people should be banned from doing a whole host of things to ostensibly prevent cheating and fraud. The faith you have in centralised authority is extremely dangerous and leads to things like the multi-trillion dollar LIBOR scandal. Unlike with a market system, industries centralised through thousands of regulatory bans cannot evolve because they are typically dominated by a small number of super-giants, and are monocultures. Super large organisms and monocultures are rare in nature for that reason. If anything is snobbish, it's your willingness to impose your will on others through forceful bans that dictate their personal financial activity. As for the hacks and thefts that have occurred thus far, it's worth nothing that Bitcoin is a young and immature sector, that is going through its growing pains. There were similar concerns about crime and fraud in the internet's early years too. I can link you to news stories from the 1990s that demonstrate this. It's not reasonable to generalize Bitcoin's first six years to the inherent qualities of p2p electronic cash.
  - JoeAltmaier 12y ago
    No faith; just experience. Virtual currencies are unregulated, and behave like it. That sort of system got us the great depression and numerous recessions. I appreciate some supporters are there for good reasons; 'snob' may be too strong a word. But it's naïve to believe a pure unregulated market is a good idea, especially one that responds at the speed of light. And where did that comment about banning bitcoin come from?
    - aminok 12y ago
      The experience of a brand new tech industry is not indicative of its future. As mentioned, the internet matured, and became safer, on its own, without regulations. Regulatory prohibitions would have destroyed everything good about the internet. The Great Depression was caused by the Federal Reserve, not free markets. The current system, in place since 1973, has overseen an increase in the banking sector's share of total corporate profits to 42%, while the Middle Class has been left behind, and the industrial core has been hollowed out. There have never been as many regulatory bans, centralized regulatory agencies, and leeway for the central bank to manipulate the money supply, as there have been over the 42 years. I'd be interested to know why you don't blame the current state of the economy on the anti-free-market system, the way you pin 1929 on free markets. >And where did that comment about banning bitcoin come from? I got the impression that you were endorsing the prevailing political ideology that favors regulatory control over industries. Regulations are a type of ban in function, if not in popular wisdom. They ban action A, if conditions X, Y, and Z aren't met. We now have thousands of such bans, limiting our actions. It makes for an unfree society. It's naive to think that government bureaucrats will not do more harm than good when given the ideological cover to prohibit nearly any activity.
  - frozenport 12y ago
    Your post mentions nothing about the necessity of inflation for economic recovery and growth. Indeed is has nothing to do with economics, just listing difficulties for regulators. You bring up the internet but remember that it is goverment regulator who protect and enforce Net neutrality - not Comcast.
    - aminok 12y ago
      Hardly anyone thinks Bitcoin is going to displace national currencies. In a Bitcoin success scenario, bitcoin would be an additional currency that co-exists with inflationary currencies. As governments will always retain the power to tax, their currencies will always have value, and they will always be able to spur activity through inflationary monetary policy. " You bring up the internet but remember that it is goverment regulator who protect and enforce Net neutrality - not Comcast." That's the telecoms, which deal with the underlying infrastructure, not 'the internet'. The telecommunication industry naturally gravitates to a oligopoly, because it provides a utility. It is inherently not competitive, so it's justifiable for government to set ground rules. That is until a decentralized global meshnet can replace the current infrastructure. If the internet itself had been subject to thousands of regulatory bans, like prohibiting people from running a server without a license from a state or federal regulatory agency, it would be nothing today.
      - frozenport 12y ago
        >>The telecommunication industry naturally gravitates to a oligopoly, because it provides a utility. Facebook tried to brand itself as a utility. Is my grocer a utility, I need food as much as I need water? I don't know what makes utilities prone to monopolies, but it probably the large investment and slow payoff - this is true of things that aren't traditionally called utilities like pharmaceutical companies, oil wells, or defense systems. These guys could use a good 'regulating. Indeed, everything gravitates towards a monopoly as it maximizes shareholder value at the expense of the large economic community, this is was recognized by antitrust regulations in the 1890s which aimed to promote capitalism. >>If the internet itself had been subject to thousands of regulatory bans Yeah but it wasn't, perhaps because they regulators didn't fail. In many ways this is a success story. Regulation is necessary, you can debate the merits of a particular method, you can say some regulation is bad or some is good but remove the goverment ability to regulate currency leaves the economy vulnerable deflation during recession which is has been attributed to the recession of the 1930s. Will high credit card transaction fee's plunge civilization into a new dark age?
- grubles 12y ago
  >lying and abuses in virtual currency systems - that surpass anything physical currency systems have experienced. Bernie Madoff wasn't using dollars to run his scheme? What about the housing market bubble? Bank bailouts? I don't recall those happening in bitcoin-land. The fact is that scams happen everywhere all of the time with everything. Beanie babies...fake gold bars... you name it.
SrslyJosh 12y ago
How about the fact that a sufficiently large adversary (e.g., Google or a powerful government) could take over the blockchain by throwing more processing power at mining than the rest of the world?
atmosx 12y ago
I can't believe that any serious finance minister would ever consider hanging over the power to create money to a non-controlled currency. Even Europeans who were stupid enough to create the EUR, are not that stupid.
aminok 12y ago
Bitcoin succeeding would not be like putting the world on a gold standard. Bitcoin is outside the control of governments, and would be an additional currency, that supplements, rather than substitutes, the current money stock.

JoeAltmaier 12y ago

I'm worried as you are. That silicon valley snobs will ignore a thousand years of learning, just to spite 'the man'. We've seen abominable cheating, lying and abuses in virtual currency systems - that surpass anything physical currency systems have experienced, in that they happen at the speed of the internet if nothing else.

aminok 12y ago
I don't believe people should be banned from doing a whole host of things to ostensibly prevent cheating and fraud. The faith you have in centralised authority is extremely dangerous and leads to things like the multi-trillion dollar LIBOR scandal. Unlike with a market system, industries centralised through thousands of regulatory bans cannot evolve because they are typically dominated by a small number of super-giants, and are monocultures. Super large organisms and monocultures are rare in nature for that reason. If anything is snobbish, it's your willingness to impose your will on others through forceful bans that dictate their personal financial activity. As for the hacks and thefts that have occurred thus far, it's worth nothing that Bitcoin is a young and immature sector, that is going through its growing pains. There were similar concerns about crime and fraud in the internet's early years too. I can link you to news stories from the 1990s that demonstrate this. It's not reasonable to generalize Bitcoin's first six years to the inherent qualities of p2p electronic cash.
- JoeAltmaier 12y ago
  No faith; just experience. Virtual currencies are unregulated, and behave like it. That sort of system got us the great depression and numerous recessions. I appreciate some supporters are there for good reasons; 'snob' may be too strong a word. But it's naïve to believe a pure unregulated market is a good idea, especially one that responds at the speed of light. And where did that comment about banning bitcoin come from?
  - aminok 12y ago
    The experience of a brand new tech industry is not indicative of its future. As mentioned, the internet matured, and became safer, on its own, without regulations. Regulatory prohibitions would have destroyed everything good about the internet. The Great Depression was caused by the Federal Reserve, not free markets. The current system, in place since 1973, has overseen an increase in the banking sector's share of total corporate profits to 42%, while the Middle Class has been left behind, and the industrial core has been hollowed out. There have never been as many regulatory bans, centralized regulatory agencies, and leeway for the central bank to manipulate the money supply, as there have been over the 42 years. I'd be interested to know why you don't blame the current state of the economy on the anti-free-market system, the way you pin 1929 on free markets. >And where did that comment about banning bitcoin come from? I got the impression that you were endorsing the prevailing political ideology that favors regulatory control over industries. Regulations are a type of ban in function, if not in popular wisdom. They ban action A, if conditions X, Y, and Z aren't met. We now have thousands of such bans, limiting our actions. It makes for an unfree society. It's naive to think that government bureaucrats will not do more harm than good when given the ideological cover to prohibit nearly any activity.
- frozenport 12y ago
  Your post mentions nothing about the necessity of inflation for economic recovery and growth. Indeed is has nothing to do with economics, just listing difficulties for regulators. You bring up the internet but remember that it is goverment regulator who protect and enforce Net neutrality - not Comcast.
  - aminok 12y ago
    Hardly anyone thinks Bitcoin is going to displace national currencies. In a Bitcoin success scenario, bitcoin would be an additional currency that co-exists with inflationary currencies. As governments will always retain the power to tax, their currencies will always have value, and they will always be able to spur activity through inflationary monetary policy. " You bring up the internet but remember that it is goverment regulator who protect and enforce Net neutrality - not Comcast." That's the telecoms, which deal with the underlying infrastructure, not 'the internet'. The telecommunication industry naturally gravitates to a oligopoly, because it provides a utility. It is inherently not competitive, so it's justifiable for government to set ground rules. That is until a decentralized global meshnet can replace the current infrastructure. If the internet itself had been subject to thousands of regulatory bans, like prohibiting people from running a server without a license from a state or federal regulatory agency, it would be nothing today.
    - frozenport 12y ago
      >>The telecommunication industry naturally gravitates to a oligopoly, because it provides a utility. Facebook tried to brand itself as a utility. Is my grocer a utility, I need food as much as I need water? I don't know what makes utilities prone to monopolies, but it probably the large investment and slow payoff - this is true of things that aren't traditionally called utilities like pharmaceutical companies, oil wells, or defense systems. These guys could use a good 'regulating. Indeed, everything gravitates towards a monopoly as it maximizes shareholder value at the expense of the large economic community, this is was recognized by antitrust regulations in the 1890s which aimed to promote capitalism. >>If the internet itself had been subject to thousands of regulatory bans Yeah but it wasn't, perhaps because they regulators didn't fail. In many ways this is a success story. Regulation is necessary, you can debate the merits of a particular method, you can say some regulation is bad or some is good but remove the goverment ability to regulate currency leaves the economy vulnerable deflation during recession which is has been attributed to the recession of the 1930s. Will high credit card transaction fee's plunge civilization into a new dark age?
grubles 12y ago
>lying and abuses in virtual currency systems - that surpass anything physical currency systems have experienced. Bernie Madoff wasn't using dollars to run his scheme? What about the housing market bubble? Bank bailouts? I don't recall those happening in bitcoin-land. The fact is that scams happen everywhere all of the time with everything. Beanie babies...fake gold bars... you name it.

SrslyJosh 12y ago

How about the fact that a sufficiently large adversary (e.g., Google or a powerful government) could take over the blockchain by throwing more processing power at mining than the rest of the world?

atmosx 12y ago

I can't believe that any serious finance minister would ever consider hanging over the power to create money to a non-controlled currency. Even Europeans who were stupid enough to create the EUR, are not that stupid.

aminok 12y ago

Bitcoin succeeding would not be like putting the world on a gold standard. Bitcoin is outside the control of governments, and would be an additional currency, that supplements, rather than substitutes, the current money stock.