it’s a lot harder for me to be sure that buying Bitcoin is +EV at $500 than at $1.
Serious question: how much analysis went into that?
I can come up with cases where the price goes down (massive regulations / bans result in no one using it), and cases where it goes a lot higher, but I’m having trouble coming up with scenarios where the price holds roughly steady (say, between $100 and $3000).
For those political connectors LWers, what could governments do to promote uptake of decentralised currencies that wouldn’t have immediate negative externalities?
Why would governments want to promote uptake of decentralized currencies in the first place?
Western countries have no interest in Bitcoin directly.
There is an interest to prevent fake medical drugs from being sold. I could imagine laws that force every sold drug to have a verifiable chain of ownership from the factory that produces the drug to the pharmacy that sells it. A chain that’s backed up by the blockchain.
In developing countries it can be useful to be able to verify how money travels through the system. Stellar and Ripple provide technologies that enable that.
I can imagine a government deciding to pay every of it’s employees via Stellar to prevent a boss from taking part of the paycheck from his underlings.
Taking tax payments via the Stellar network would further make it the default system.
A government cares about a bunch of long-term predictions about how it’s economy is going. It might be worth for creating subventioned prediction markets in Augur for climate changes 10 years from now or for various economic forecasts for which it’s good to have reliable data.
Subventioned prediction markets might work better than paying government burocrats to do forecasts in many cases.
If usdcoin (the digital construct) is successful at the expense of bitcoin, why would bitcoin be used at all?
My “bitcoin value collapses” scenario list includes the cryptocurrency space being won by an altcoin. I should probably give some more analysis to the specific altcoin of “something pegged to fiat, with government backing”.
But if that coin succeeds, won’t it be the fee currency? Why would btc coexist in a meaningful but not dominant position?
(I can see BTC coexisting with USD and EUR if you can’t pay taxes in BTC, but if BTC succeeds in that scenario, I think there’s still lots of headroom for the price.)
Lack of counter-party risk. There are a variety of mostly technical reasons why it is desireable that fees be paid in a peer-to-peer issued currency vs a central-party issued currency. For example, if there are multiple competing currencies in use (e.g. usdcoin and eurocoin, or more likely bitstampusd vs bitreserveusd), then a p2p currency like bitcoin provides a neutral platform for setting fee policy.
Serious question: how much analysis went into that?
I can come up with cases where the price goes down (massive regulations / bans result in no one using it), and cases where it goes a lot higher, but I’m having trouble coming up with scenarios where the price holds roughly steady (say, between $100 and $3000).
For those political connectors LWers, what could governments do to promote uptake of decentralised currencies that wouldn’t have immediate negative externalities?
Why would governments want to promote uptake of decentralized currencies in the first place?
Western countries have no interest in Bitcoin directly.
There is an interest to prevent fake medical drugs from being sold. I could imagine laws that force every sold drug to have a verifiable chain of ownership from the factory that produces the drug to the pharmacy that sells it. A chain that’s backed up by the blockchain.
In developing countries it can be useful to be able to verify how money travels through the system. Stellar and Ripple provide technologies that enable that. I can imagine a government deciding to pay every of it’s employees via Stellar to prevent a boss from taking part of the paycheck from his underlings. Taking tax payments via the Stellar network would further make it the default system.
A government cares about a bunch of long-term predictions about how it’s economy is going. It might be worth for creating subventioned prediction markets in Augur for climate changes 10 years from now or for various economic forecasts for which it’s good to have reliable data. Subventioned prediction markets might work better than paying government burocrats to do forecasts in many cases.
Here’s one: it doesn’t become a commonly use currency or investment mechanism, but rather merely a fee currency for some other construct like usdcoin.
If usdcoin (the digital construct) is successful at the expense of bitcoin, why would bitcoin be used at all?
My “bitcoin value collapses” scenario list includes the cryptocurrency space being won by an altcoin. I should probably give some more analysis to the specific altcoin of “something pegged to fiat, with government backing”.
But if that coin succeeds, won’t it be the fee currency? Why would btc coexist in a meaningful but not dominant position?
(I can see BTC coexisting with USD and EUR if you can’t pay taxes in BTC, but if BTC succeeds in that scenario, I think there’s still lots of headroom for the price.)
Lack of counter-party risk. There are a variety of mostly technical reasons why it is desireable that fees be paid in a peer-to-peer issued currency vs a central-party issued currency. For example, if there are multiple competing currencies in use (e.g. usdcoin and eurocoin, or more likely bitstampusd vs bitreserveusd), then a p2p currency like bitcoin provides a neutral platform for setting fee policy.