Monetagium – monetary extortion in feudal Europe

It doesn't in any way fix things. The underlying point of debasement and other schemes outlined in the article was to generate revenue for the government. Now governments use taxes to generate revenue and inflation to encourage circulation.

While taxes and inflation are generally unpopular they are also vital to the functioning of society and the economy. BTC and many other token schemes implicitly or explicitly stand in the way of that.

Breaking a system you don't like doesn't automatically get you a system that's better.

Bitcoin would make an awful legal tender, because by its design supply decreases while demand for it increases. An ideal, 0% inflation currency (assuming that is ideal) would expand and contract automatically with economic conditions. Satoshi considered this problem but decided it was too complicated to implement, which is why he went with the fixed supply route.

Still, it's worth remembering that a fixed supply currency will inevitably fail just as the metallic standards (which were semi fixed supply) did, and for the same reasons: politics. Metal backed currencies fell because the political will required to coordinate the system fell apart. Newly-enfranchised workers didn't find the message "suck it up, the gold standard requires it" very appealing politically, so they voted for other things that entailed fiscal and monetary policy. Central Banks, seeing the writing on the wall, abandoned gold en masse, with the US retaining it only for other central banks.

Bitcoin would have the same problem. It would be inevitably deflationary - halvenings, for example, are tied to computational power. Presumably, more demand for Bitcoin means more computational power, so its supply decreases just as demand increases.

Deflation is even worse than inflation for working people. Investment dries up, because why would somebody take a gamble on a business if they can keep their cash in their closet and make money, risk free? Employment therefore drops, while people decrease spending - why spend $100 on something today, if you can buy it for $85 in a year? Additionally, loans get more expensive in real terms, wages decline, and a whole host of other bad things happen.

That's why central banks target +2% inflation, in part. Inflation is preferable because it encourages investment, discourages nominal (and only nominal) wage decreases, decreases the real value of loans to the benefit of the debtor class, and other benefits. Central Banks also have a pretty successful record dealing with runaway inflation - hike rates, cause a recession, wait - whereas they lack tools to deal with deflation. At its simplest, the solution to deflation is for everyone to get a check from the government, but this whole field is considered weirdo experimental land and has only barely been tested.

All that is to say: Bitcoin is fundamentally ignorant of history and is incapable of becoming anything other than digital gold. It has a floor value which it cannot sink beneath: online gambling, illegal things, and privacy advocates (in that order) guarantee it will never truly hit $0.00. But it would be an absolute catastrophe for any country to adopt as its actual currency.

Now that I think of it, Bitcoin is perhaps one of the earliest examples of technophiles assuming society should work according to computer code, thereby "cleaning" these imperfect human systems by replacing them with the inevitable future: A philosophically-driven (rather than pragmatically or empirically, for example) system, with clear and inviolable rules, limited to no exceptions, and a happy ignorance of why existing systems came to be. After all, why study the past when we're creating the inevitable future?

When it's even available. But then they start cranking the ratchet, increasing the no-ad price and introducing a with-ads tier at the old no-ad price, or cutting quality, or cutting corners on customer service and security, etc etc. We've seen this play out many many times and it's a fundamental outcome in even the most basic econ 101 models: an oligopoly with high switching costs is more profitable for suppliers than a free market, made all the moreso by tacit collusion. An unregulated free market is essentially doomed to fail whenever an opportunity to establish such an oligopoly arises.

In extreme cases it does start to look like a protection racket, especially when important services like broadband Internet are involved.

A 100 years from now, someone is going to write an article about the insanity of today's advertising models that is going to be immediately obvious to anyone from that era, while we, much like the feudal vassals, are unable to see it, having experienced no alternative.

One of the other factors preventing people from starting small businesses is lack of affordable health insurance. They can buy coverage through state exchanges but those are still more expensive that group health plans offered by large employers.