bitcoin is not a real commodity, it’s a poor immitation like some type of tranny. The sunk cost in so called “creating” a bitcoin in the past does not transfer into delivering anything tangible into the future. It’s more like a steady state system that can catastrophically fail and vaporize all imaginary “wealth” attached to it at any time – the glaring trait of all currencies past and future. One of the main reasons the noble metals are valued as money (gold and silver) are the anti-corrosive properties to defeat time itself, which guarantees you the ability to transfer that unit of account from the past to future, UNLIKE bitcoin.
The distinction between money and currency is one that is blurry and arbitrary.
Many tend to think of money as something that is tied to a physical commodity and everything else as currency but that is not really accurate.
The reality is that all money/currency is an arbitrary construct created by man to facilitate trade and savings. Paper currencies have a long track record of failure. This failure is due to the inherent flaws of mankind rather then a fundamental problem with paper money.
We choose to embrace thinks like fractional reserve lending, defecit spending, and unfounded entitlements all of which lead to fiscal instability and undermine the currency system leading to eventual failure.
Gold and Silver are simply attempts to take human weakness out of the picture by tying the concept of money to something that cannot be easily forged or mass produced. This works to a degree but it historically also ultimately fails to restrain us from eventually debasing and destroying the currency system. We see this in Rome and also in our recent past as we were not long ago on a gold standard.
bitcoin is a new attempt to separate destructive human weakness from a money/currency system. The new mechanism is decentralization and computer algorithms to replace flawed human judgment. If it will succeed long term remains to be seen but we know paper currency consistently and repeatedly fails and we know precious metal currency repeatedly fails so now we will learn how well digital currency works.
How this scaling debate plays out will be important to watch. The 95% requirement for implementation as seen in some of the bitcoin update proposals is a very wise threshold to use. If bitcoin ever becomes a simple voting mechanism where 51% of hashing power is able to implement widely accepted changes to the protocol over the objections of the other 49% then human error has returned to the forefront. bitcoin would then become the same system we already have. A complex fiat voting system.
Published at Sun, 02 Apr 2017 17:05:50 +0000
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By CashlessWay – Global Hub for ePayment Culture on 2014-06-28 09:38:56
