What do you say to that? Ouch. Does this demonstrate that the naysayers calling it a Ponzi Scheme were ideal? Do they get the last laugh, or is this just an anticipated evolutionary process of disruption as all the kinks are worked out? Well, consider this thought experiment I had.
Let’s say there was hanky-panky involved, let’s say someone hacked the system or stole the electronic money. Right now, digital money flies under the radar as it is not recognized even with all of the new Too Big To Fail regulations on banks, etc.. How can a digital currency have worth? Difficult to say, how can a fancily printed piece of paper marked $20 be worth anything, it’s not, but it’s worth what it represents if we all agree to that and have trust in the money. What’s the difference, it’s a matter of trust right?
Okay so, let us say that the authorities, FBI, or another branch of government interferes and documents charges – if they file criminal charges that somebody defrauded somebody else then how much defrauding was involved? In the event the government enforcement and justice department put a dollar amount number to this, they are inadvertently agreeing that the digital money is real, and it’s a value, thus, acknowledging it. If they don’t get involved, then any fraud which might or might not have happened sets the whole notion back a long way, and the media will continue to drive down the confidence of all electronic or crypto-currencies.
So, it’s a catch-22 for the authorities, regulators, and enforcement folks, and they cannot look another way or deny this trend any longer. Could it be time for regulations. Well, I personally despise regulation, but is not this how it usually begins. Once it is regulated credibility is given to the notion, but his electronic currency theory could also undermine the entire One World Currency plan or perhaps the US Dollar (Petro-Dollar) paradigm, also there could be hell to pay for this as well. Can the global economy manage that level of disturbance? Stay tuned, I guess we will see.
In the meantime, what happens next will either break or make this new change in how we view monetary price, wealth, online transactions and how the real world will mind-meld into our prospective blurred reality. I simply don’t see a lot of people thinking here, but everybody should, one misstep and we could all be in a world of hurt – all of humankind that is. Please consider all of this and think on it. These few things to consider will make a difference in your knowledge as they relate to crypto genius software. However is that all there is? Not by a long shot – you actually can broaden your knowledge greatly, and we will help you. It is difficult to ascertain all the various means by which they can serve you. Do take the time and make the effort to discover the big picture of this. We are not done, and there are just a couple of very strong suggestions and tips for you.
Bitcoin is further away from being The numeraire; not just can it be simply a few, much as Fiat… but its value is quantified in Fiat! Even though Bitcoin becomes internationally accepted as a medium of exchange, and even if it manages to replace the Dollar as the accepted ‘numeraire’, it can never have an intrinsic measure like Gold has. Gold is exceptional in being quantified by a real, unchanging physical quantity. Gold is exceptional in storing value for thousands of years. Nothing else in touch of humanity has this exceptional blend of qualities.
In Summary, while Bitcoin has Some advantages over Fiat, namely anonymity and decentralization, it fails in its own promise to being money. Its advantages will also be questionable; the aim would be to restrict the ‘mining’ of Bitcoins into 26,000,000 units; this is , the ‘mining’ algorithm makes harder and harder to solve, then impossible following the 26 million Bitcoins are mined. Unfortunately, this statement might well be the death knell of Bitcoin; currently, some central banks have announced that Bitcoins might become a ‘reservable’ currency.
Wow, sounds like a Significant measure for Bitcoin, does it not? After all, the ‘large banks’ seem to be accepting the legitimate worth of this Bitcoin, no? This really means is banks recognize that they could exchange Fiat to get Bitcoins… and also to actually buy up the 26 million Bitcoins projected would cost a meagre 26 Billion Fiat Dollars. Twenty six billion Dollars isn’t even small change to the Fiat printers; it is about a week’s worth of printing by the US Fed alone. And, once the Bitcoins bought up and locked up at the Fed’s ‘wallet’… what useful purpose could they serve?
There would be no Bitcoins left in Flow; an ideal corner. If there aren’t any Bitcoins in circulation, how on Earth could they be used as a medium of trade? And, what could the issuers of Bitcoin potentially do to defend against such a fate? Change the algorithm and increase the 26 million into… 52 million? To 104 million? Join the Fiat print parade? But , from the quantity theory of money, Bitcoin would begin to eliminate value, just as Fiat allegedly loses value through ‘over-printing’…
We come into the main dilemma; why search For a ‘new money’ if we have the very best money, Gold? Fear of Gold confiscation? Lack of anonymity from an intrusive government? Brutal taxation? Fiat money legal tender legislation? All the above. The answer is not in a new sort of cash, but at a new social structure, one without Fiat, with no Government spying, without drones and swat teams… without IRS, border guards, TSA thugs… on and on. A huge independence not tyranny. Once this is accomplished, Gold will resume its ancient and critical role as fair money… and not a minute before.
Rudy J. Fritsch was born in Hungary In 1947, also fled Socialist tyranny throughout the Hungarian Revolution of 1956. His family had lived through WWII and the resultant Hungarian hyperinflation, so he’s intimate encounter with financial devastation.
As an engineer and entrepreneur, he Conducted a successful family business in Canada for years, in its peak employing over 100 workers, until economic upheaval ruined the sustainability of North American production. Driven from business, he chose to study economics… to discover the cause of the unhappy circumstance.
The halving occurs when the Number of ‘Bitcoins’ awarded to miners following their successful creation of this new block is cut in half. Thus, this phenomenon will cut the given ‘Bitcoins’ from 25 coins to 12.5. It is not a new thing, however it does have a lasting impact and it is not yet known whether it is good or bad for ‘Bitcoin’.