"Bitcoin itself is a currency that might best be considered existing in a state of anarchy."
Excellent article. Unexpected from qotr!
I will be the first to admit I am a gold bug and believe gold is going to rise in value as the US dollar continues to fall apart.
Anyone that disputes me on this just needs to look at the US debt - how much further can the congress-critters continue to kick the can? Sooner or later that can is going to bounce off a wall and hit back.
However, the problem with gold is "how do we fit it into the monetary system that we have" question is unresolved. How do I buy something on Amazon using gold? Who is the intermediary between Amazon and myself? That intermediary is going to be powerful and will set the terms. This is exactly what the article addresses. To that end, I have been "investing" in Bitcoin. I see a lot of potential in Bitcoin as we no longer will have the government busybodies telling us what to do. We have a monetary system that is completely neutral and functional. I look forward to seeing what Bitcoin can do....
Fascinating article. I always get an education when I read QTR and the information he posts from others.
Without reading any of the books commented on, it would appear this “idea” is all about a “true” free market system. I am not sure I would add the term “anarchic” to this type of currency/system since it gives the connotation of something evil or destructive.
It would be great to remove all of the corrupt courts, special interests, politicians, bankers, from the system. What a dream. Private currency.
Will be adding "The moon is a harsh mistress " to my reading list had never heard of it. I love the Friedman, Hayek, and Rothbard, Rand references in the piece.
I would like to rewrite the quote on top to "bitcoin itself is NOT a currency; existing in a fraudulent market beginning after years of insane monetary policy (hyper cheap interest and rabid financialization) and VC money coming out of the mother of all bubbles. where retail gamblers get fleeced repeatedly by the whales and fraudsters that is Tether mafia and any exchange that lists this fraudulent token"
Also as I type this at 4:53 AM Texas time bitcoin is sitting at 26,777 Tethers. Not sure how many $ it is worth, my guess is 0 or an asymptote. Even bitcoin maxis seem to understand Tether is no bueno, I think they miss how this relates to the perceived $ price of BTC they own.
Two words: Legal Tender. I'm not buying the idea that anarchy (using the word in its political science sense) can create the predictability of adjudication/enforcement of contracts. Economic growth requires people be able to make decisions based on reliable information and predictable outcomes when a dispute arises. So if you enter into a contract where obligations are measured in a crypto unit, and a dispute arises, you have to come to terms with the fact that unless that unit is recognized as legal tender, you have no recourse in court.
Crypto will never be anything other than a speculative digital forex play as long as the USD enjoys a monopoly on legal tender. Here is what is needed: