> crypto-currencies are simple and transparent.
beg pardon?
You don't understand money – and it's a good thing for Bitcoin
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Re: You don't understand money – and it's a good thing for Bitcoin
#12Anyone have book or article recommendations on how money works?
I haven't read it but I've been recommended Debt: The First 5,000 Years by David Graeber numerous times.
It’s a highly verbose book but worth a read. Graeber makes some solid points such as money didn’t evolve from bartering but instead evolved from debt
Re: You don't understand money – and it's a good thing for Bitcoin
#13Bitcoin is a multi faceted beast like nothing else. It is a cross between computer science/cryptography, governance/game theory and economics.
In my opinion the economics of bitcoin is the core, which is kept in balance and managed with game theory and decentralised governance and it is created with computer science and cryptography.
In order to truly understand what Bitcoin is then you need to fully grasp all these 3 facets. Most people don't, they read the headlines or look at bitcoin from one of the facets and write it off.
Re: You don't understand money – and it's a good thing for Bitcoin
#14Money is simple. Credit is complicated. And if Bitcoin is going to succeed lending Bitcoin will be normal and lead to similar behavior as in the gold standard.
I guess you could say that goldsmiths pretending they have more gold than they really do is kinda similar to cryptocurrency exchanges doing the same.
Re: You don't understand money – and it's a good thing for Bitcoin
#15> Take the questions we mentioned above, and apply them to Bitcoin: Sure, you can easily answer cherry-picked questions about Bitcoin. But the important thing is: nobody in his day-to-day life needs to know these answers about real money, nor have they ever wondered about it. I can buy groceries just fine with my Euros, without wondering how exactly it has been created. Just as I wouldn't tailor my own paragliding ch…
Tell that to a Zimbawean.
EDIT: Seriously. Just because our Western bureaucrats are comparatively honest these days, doesn’t mean how it functions doesn’t matter? Things could change, you know, as history repeats itself.
Re: You don't understand money – and it's a good thing for Bitcoin
#16> Take the questions we mentioned above, and apply them to Bitcoin: Sure, you can easily answer cherry-picked questions about Bitcoin. But the important thing is: nobody in his day-to-day life needs to know these answers about real money, nor have they ever wondered about it. I can buy groceries just fine with my Euros, without wondering how exactly it has been created. Just as I wouldn't tailor my own paragliding ch…
Tell that to a Zimbawean. EDIT: Seriously. Just because our Western bureaucrats are comparatively honest these days, doesn’t mean how it functions doesn’t matter? Things could change, you know, as history repeats itself.
Or a Venezuelan.
Re: You don't understand money – and it's a good thing for Bitcoin
#17All of the author’s core questions can be answered just as well for coins and notes as they can for bitcoin— Every greenback has a unique serial number, after all. There must be a central registry of them somewhere. Money as understood by economists is not physical currency (coins, notes, etc), but an emergent property of the institutional use of IOUs of various kinds, like debts and fractional reserves. These also e…
> These also exist in the bitcoin world, and have already caused problems— How long did MtGox operate without reserves?
Exchanges are not part of the bitcoin world, they are bridges to it.
Longer version of the above remark: what bitcoin is truly about is financial sovereignty, or, to put it in more layman's terms, lack of counterparty risk. The bitcoins held in a bitcoin exchange are mismanaged funds, you should never leave your cryptofunds in the exchange: "not your keys, not your coins".
PS: These days, you can even find "bridges", i.e. exchanges, that don't have even this problem anymore, e.g. HodlHodl exchange, which doesn't hold customer's funds, so it's impossible to achieve a fractional reserve malpractice.
Re: You don't understand money – and it's a good thing for Bitcoin
#18Bitcoin is a multi faceted beast like nothing else. It is a cross between computer science/cryptography, governance/game theory and economics. In my opinion the economics of bitcoin is the core, which is kept in balance and managed with game theory and decentralised governance and it is created with computer science and cryptography. In order to truly understand what Bitcoin is then you need to fully grasp all these…
In the absence of detailed understanding, it turns into a matter of trust.
Who will people trust more, banks and governments, or cryptocurrency nerds with untouchable money on the blockchain?
I think most people will opt for banks and governments, because when the going gets tough, the masses can overthrow them and expropriate from them. Cryptocurrencies put too many mathematical obstacles in the way of redistributing wealth against the owner's wishes.
Re: You don't understand money – and it's a good thing for Bitcoin
#19Earlier quoted context omitted.
Tell that to a Zimbawean. EDIT: Seriously. Just because our Western bureaucrats are comparatively honest these days, doesn’t mean how it functions doesn’t matter? Things could change, you know, as history repeats itself.
Or a Venezuelan.
Or German Marks when they were worthless after WWI and bundled in huge stacks. I feel like people in “developed” countries think “this couldn’t happen to me” when time has shown us time and time again it certainly can and you will be powerless to the whims of your government. Our original poster feels the same false safety in his or her Euros. They have developed amnesia to the lessons of the recent past. Bitcoin can be a safety valve out in case of those same cyclical disasters. It is freedom from your government’s manipulations of your money. Is it perfect or ultra stable? Absolutely not, but every person, especially the ultra rich, needs it in their portfolio.
“The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” -Satoshi Nakamoto
Re: You don't understand money – and it's a good thing for Bitcoin
#20All of the author’s core questions can be answered just as well for coins and notes as they can for bitcoin— Every greenback has a unique serial number, after all. There must be a central registry of them somewhere. Money as understood by economists is not physical currency (coins, notes, etc), but an emergent property of the institutional use of IOUs of various kinds, like debts and fractional reserves. These also e…
No, in fact they do not keep track of each individual dollar. At least for aggregate money supply; perhaps they do keep track of M0. I am not sure.