Digital crypto assets like Bitcoin or Ethereum will exist alongside them. Bitcoin can be an asset like gold, of which users keep a portion of their networth to protect from economic uncertainty.
Its deflationary policy may make it less usable as a currency, but at least crypto gives people choice.
In terms of facilitating payments, cryptocurrencies are worse in almost every way I can think of compared to existing systems. They are (currently) slow, have high transaction fees, but most importantly the non-refundability of crypto transactions is a bug, not the feature crypto proponents suggest.
However, as a store of value (e.g. "digital gold"), I think crypto has real potential. There is a reason crypto is very popular in places with hyper-inflationary monetary systems like Venezuela and Iran. And compared to actual, physical gold, crypto is almost better in every way: it is much more easily transferred and stored, and the ledger means establishing "provenance" is not an issue. Yes, it's obviously currently extremely volatile, but it's not hard to imagine that volatility lessening over time.
I feel like I’ve heard this every year since 2015. I think it’s going to be hard to shake the majority perspective that it’s a speculative asset.
5 years is a pretty short window in the grand scheme of things when talking about the adoption of technologies.
Point being that even with gold's volatility it is still seen by pretty much everyone as a viable store of value, and I think BTC will be similar.
This is only true for bitcoin and ethereum.
Seems improbable, as it is far less stable than Gold. From what I see, it is almost never used as a currency, and almost always as a speculative asset. The main indicator for me is that Bitcoin is always measured in Dollars (or some other fiat currency), instead of having some value that it taken to be it's own. Have you ever heard someone say "This bike cost me 0.63 Bitcoin"?
You stored your gold in a bank, and the bank gave you paper coupons to redeem it. People traded the coupons because it was easier than trading the gold. This is the birth of modern day banking.
If so, why? I think volatility will down as volume and scale increase.
When you stop trusting the USD/central bank, what will you turn to?
> I don’t see how it could possibly be fair when earlier mining yielded currency more quickly.
If by design, fiat currency has an infinite volume of transferrable currency, do governments have an unfair advantage that could potentially make the currency unstable?
I don't see how it could possibly be fair when just printing it yielded currency more quickly than properly earning it.
Build infrastructure = provide a service.
Get paid taxes for usage of said infrastructure = earn money for properly providing a service.
> Secondly, a managed currency controlled by a central bank under the control of a democratic government is a good thing.
That is a tautology, you merely rephrased the claim without providing any argument.
I didn't provide a reason, but it's not a tautology. I would accept "bland assertion".
Taxes and provision of services are completely separated. Citizen did not get their money back when schools closed because of the pandemic.
I'd like the coin to take off as an actual currency, and of the coins I've looked at, I think it has the most potential for adoption in that respect.
But I don't think it's got the ecosystem to support that right now. A metamask-style doge wallet would do wonders for this.
Also, knowing little to nothing about the backend (or other crypto backends, tbh), other than that it's derived from Bitcoin - I have concerns about scalability wrt transaction settlement times, power consumption, and ease-of-entry with self-hosted wallets.
Managed currencies tend to devalue over time. Rich families must invest and risk capital to keep growing their fortune, not just sit on it.
This is true of Bitcoin. Others, such as Ethereum, have a known inflation schedule, which would help alleviate the issue you mentioned as being a currency of the future. Furthermore, it is looking like the "currency of the future" may (at least in the short term), look more like a cryptocurrency that is worth $1 and is 1:1 backed by a dollar in a bank account. These are known as stablecoins and are an in-demand topic right now for central banks around the world.
Bitcoin has a property of having a known, fixed supply. This allows it to serve as a store of value. It can and is used for day-to-day transactions, but there may need to be more advancements to make these types of transactions viable long-term (such as the lightning network).
The idea of cryptocurrency is to replace fiat currencies, with an engineered system instead of a political system. There's no benefit in a cryptocurrency that's backed by a fiat currency. It's like building a stone house on a swamp.
I think the point of fiat backed stable coins are more for getting around regulations (eg Tether) and a fiat on-ramp for getting into the ecosystem. Certainly if the government seized a large portion of Tethers assets then that could affect other assets, but this actually has already happened with (a small portion, not large) Tether and nothing catastrophic happened.
Bitcoin was the first fair currency, where everybody who had a computer could get it.
There wasn't any currency created a more fair way.
Even now everybody can look at it and evaluate how well its design resonates with his or her philosophy.
Even if it was correct, that would be an extraordinarily bizarre definition of "fair".
If by design, cryptocurrency has a finite volume of transferrable currency, do early adopters have an unfair advantage that could potentially make the currency unusable? I don’t see how it could possibly be fair when earlier mining yielded currency more quickly.