I (like the author) am torn about cryptocurrency. Is it the future or just a fad? I wish I knew. However, a few very serious points do stand out.
1. Bitcoin is not stable. The value of a Bitcoin has been highly volatile over time. That makes Bitcoin a poor 'store of value'. In this respect, Bitcoin is much like Gold. Gold is also volatile.
I (like the author) am torn about cryptocurrency. Is it the future or just a fad? I wish I knew. However, a few very serious points do stand out.
1. Bitcoin is not stable. The value of a Bitcoin has been highly volatile over time. That makes Bitcoin a poor 'store of value'. In this respect, Bitcoin is much like Gold. Gold is also volatile.
2. Bitcoin is not a fiat currency. In many respects that is a good thing. No government can print Bitcoin, as it deems convenient. In this respect, Bitcoin is much like Gold. Back when Gold was money, inflation really did not happen. For example, the CPI in 1918 was apparently lower than it was in 1800. However, economies were deeply volatile. The price of currency stability was economic instability. Cryptocurrencies could mean a return of the bad old days.
My guess is that governments will never accept the loss of power that could be a consequence of cryptocurrencies. I am not at all sure if they should.
But that green paper that the government just prints massive amounts of...whenever it has a problem...that's a good store of value? Backed by *nothing* but the 'integrity' of said government? The integrity that is (finally) on the cusp of a massive landslide? The loss of power isn't coming because of crypto. Crypto will be a life preserver.
I (like the author) am torn about cryptocurrency. Is it the future or just a fad? I wish I knew. However, a few very serious points do stand out.
1. Bitcoin is not stable. The value of a Bitcoin has been highly volatile over time. That makes Bitcoin a poor 'store of value'. In this respect, Bitcoin is much like Gold. Gold is also volatile.
2. Bitcoin is not a fiat currency. In many respects that is a good thing. No government can print Bitcoin, as it deems convenient. In this respect, Bitcoin is much like Gold. Back when Gold was money, inflation really did not happen. For example, the CPI in 1918 was apparently lower than it was in 1800. However, economies were deeply volatile. The price of currency stability was economic instability. Cryptocurrencies could mean a return of the bad old days.
My guess is that governments will never accept the loss of power that could be a consequence of cryptocurrencies. I am not at all sure if they should.
But that green paper that the government just prints massive amounts of...whenever it has a problem...that's a good store of value? Backed by *nothing* but the 'integrity' of said government? The integrity that is (finally) on the cusp of a massive landslide? The loss of power isn't coming because of crypto. Crypto will be a life preserver.