Bitcoin Quandary

It is important for our system of payments to improve over time and this means that we need experiments like Bitcoin to take place. Ron Paul says that if Bitcoin is successful then the government will crush it. Now there is a problem.

Comments

  1. I had just always assumed that Bitcoin was designed as a currency for drug sales. Once the Silk Road is closed, why, exactly, does anyone need their electronic purchases to be that secure?

    I can understand why people would want their electronic funds to be almost comically private, I am just not sure of the need.

    Anyway, the government has no need to crush it. They could simply announce that they wire-tapped a few computers here and there, and figured out a way to trace it. Once people think it can be traced, it loses some (if not most) of its value.

    Any currency that uses secrecy and speculation as part of its intrinsic value will suffer in comparison to traditional currencies: Bitcoin will eventually share all the disadvantages of the U.S. dollar, with few of the advantages.

    • You are missing the point. Currencies must be anonymous to protect ourselves and our wealth against government greed and intrusion. Nowadays is already bad enough with all governments spying massively supported by massive budgets based on massive theft through taxation. This is today. Tomorrow, it will be astronomically worse. Although a cryptocurrency is not the perfect solution, is a step in the right direction. Bitcoin is not 100% anonymous in the true sense and it was never intended to be so. It is just hard enough to require a large, concerted effort from many governments to figure out who is buying what. This provides some safeguard against said governments. They cannot “just crush it”. It is not that technically easy to do. As to the concept of using “secrecy and speculation”, I have bad news for you. Since the dawn of human kind, secrecy and speculation has been at the hearth of currency. Only recently has the insatiable government thirst for intrusion turn those concepts upside down. I would like to remind you that it is none of government business how do we spend our money. As to the concept that the Bitcoin will share all the disadvantages of the US dollar, I doubt it. Bitcoin is not controlled by any government; right there you have the biggest difference. Then again, it is a human design, so it may be prone to other issues. However, again, you are missing the point. Bitcoin is a step forward.

  2. http://www.theregister.co.uk/2013/12/05/chinese_banks_banned_from_using_bitcoin/

    China has banned its banks from using Bitcoin after warning the cryptocurrency could be used to fund terrorism.

    Financial institutions in the Middle Kingdom will no longer be able to use Bitcoin, although citizens are free to spend the digital funny money.

    The People’s Bank of China announced its decision in a statement countersigned by four other financial bodies. It said that Bitcoin was a “virtual good” rather than a currency.

    “Although there are people calling it a ‘currency’, it is not issued by the monetary authority, it does not possess the attributes of a currency such as legal repayment and enforcement abilities,” the central bank said in its (Chinese-language) missive

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