Cryptocurrencies: looking beyond the hype

> Receiving, owning and spending money anonymously. Remember when extortionists had to be paid with a suitcase full of banknotes?

As stated in other comments, Bitcoin is hardly anonymous anymore. There's a much greater ability to trace wallet addresses back to individuals or groups than there used to be.

> Receiving money without being exposed to the danger of fraud. Receiving money via Credit Card is surprisingly risky for the merchant.

Fraud was (and likely still is) rampant in the digital currency community when Bitcoin hit its peak. Plenty of it was going on in direct relation to the system and we've also seen the 51% attacks plus price manipulation.

Also, at least with credit there's legal recourse. It's at least something compared to nothing with digital currencies.

> Transferring money internationally without additional costs.

At Bitcoin's peak there was a significant cost to doing any transfers. This is now admittedly lower but to the average person I don't think this is a strong enough argument alone.

> Portfolio optimization. Crypto currencies are probably not perfectly correlated to other assets. So it stabilizes the portfolio to add some crypto.

This is where I start to think you're joking. The volatility of digital currencies doesn't stabilize any portfolio. At best it contributes to a diversified portfolio. At worst, you're correct, it doesn't really correlate to any asset. It is tied to nothing tangible.

You can argue that something is worth whatever someone is willing to pay for it but that's such a terrible argument when the few businesses who tried accepting it are moving away from that, volatility again being one of the major issues. At a certain point there's nothing to be gained other than 'street cred' for having more of these coins attributed to an address that you claim to own.

Blockchain technology will stick around, digital currencies, at least those supposedly worth thousands, will not. I'm sure by now readers can tell I'm very against this. The people riding the digital currency hype train sound no different to me than those involved in pyramid and/or ponzi schemes.

The fact that Bitcoin is consuming so much electricity and takes so much computing power to confirm a transaction should be enough of an argument against it.

Also, what do you propose when quantum becomes mainstream? Every wallet in existing currencies will be cracked in mere seconds and investors will lose all of the coin they will have amassed. I'm sure someone will try to create a quantum digital currency but by then the opportunists that make up most of this market will hopefully realize how overhyped this was.

It is not a hypothetical situation. It is happening right now in Venezuela.

All you have to do is look how Venezuelans are using Bitcoin right NOW to understand it's value.

Most damning to me is that the case against cryptocurrency takes two sentences to clearly outline, while the case for them is yet to even emerge.

Transactions are slow and costly, prone to congestion, and cannot scale with demand. The decentralised consensus behind the technology is also fragile and consumes vast amounts of energy.

Nailed it.

Traditional payment systems are safer, cheaper and more efficient than crypto.

They don't care for certain aspects of the social contract and want to be able to flaunt it at will with no repercussions. Or they don't want to pay taxes or some other thing. Whatever, they feel that society at large is what's holding them back, not simply a lack of ability or drive.

At least with religious fundamentalists or whatever flavor of totalitarianism you're comfortable with, it's clear what their answer to the problem of force is: be the force.

Anarchists have no answer to that. They want to "be free to do whatever" but when confronted with the question of what happens when I want their shit, they invariably create government. Oh, I can't take their shit because there will be rules. In the community they live, you can't live there if you take other people's shit.

Yeah. That's just government. That's politics. That's the social contract. We all agree not to do shit in order for us to live relatively peaceful, chill lives.

Government, in the broad sense, is not the problem. The problem is that governments are still run by people. And we're kind of fucked up. And we often make mistakes.