[0bsidian]

I respectfully disagree with the idea that Bitcoin's killer-app is to be used as a currency for transactional purposes.

I can't really think of many reasons why you would use crypto to pay for a coffee or a sandwich if you live in the West (or frankly, even most developing nations).

On the other hand, I can definitely see the utility in a censorship-resistant digital medium to store wealth. To me, this latter use case has much, much more potential to serve the unbanked (as well as the banked).

Some use cases I can think off the top of my head:

(1) You are from Syria and need to flee war and escape into Europe – however bank transfers into Europe are almost impossible if you are a common Syrian. Bitcoin allows you to take your wealth with you, in your brain, as you escape across the border, by just memorising your twelve word private key.

(2) You are from Venezuela or Zimbabwe – The government has issued capital controls and is devaluing currency by the day. You transfer your wealth into Bitcoin in order to offset capital erosion due to hyper-inflation. When the situation stabilises, you transfer your Bitcoin back into fiat.

(3) You are Saudi billionaire Al-Waleed bin Talal. The government freezes all your assets in a political coup. If you have a portion of your wealth in Bitcoin, you could protect them from government expropriation and anonymously transfer them to associates or family members abroad.

(4) You are whistleblower Julian Assance and have been cut off from the financial system as a way to censor your speech. Bitcoin allows you to have an unbreakable digital "Swiss bank account" that the authorities are not able to reach.

This reminds me of Peter Thiel's recent words about Bitcoin [1]: "it's like a reserve form of money, it's like gold, and it's just a store of value. You don't need to use it to make payments."

Reference:

[1]: https://www.cnbc.com/2017/10/26/bitcoin-underestimated-peter...

[timfrietas]

Personally, I disagree with your premise and I do think the killer app for Bitcoin is to be transactional--unlike Ethereum you can't build anything on top of it, it's just "money" or "wealth" which do need to be spent, although you can think of the current incantation of Bitcoin as "wire transfers" (a few hours to a couple of days to get your money) instead of a "debit card" (instantaneous transactions).

However, I do not at all understand why you are apparently being downvoted for a calm and logical counter argument supported with good use cases.

[panarky]

> unlike Ethereum you can't build anything on top of it

I see the cryptocurrency ecosystem as several layers used in concert.

             -- Apps & Exchanges --      
         -- Smart Contracts & Tokens --
  --Slow, Reliable Store of Value & Large Trans--

The internet isn't just one giant site that does all things for all people.

Similarly, the "internet of money" has multiple components that each do one thing well.

[0bsidian]

THIS.

Thank you for this.

I will quote your response in the future when this point comes up again, if it's OK?

I was listening to Naval Ravikant who makes exactly the same point about Bitcoin.

[lawn]

How can something be a store of value only?

For something to be a store of value you want it to appreciate in value and have enough liquidity for you to cash out.

If you want it to appreciate in value there must be something driving the price. It cannot be others who only want to store their value as then the price is dependent on greater fools entering with new capital. Pure speculation cannot uphold the price long term.

Wanting Bitcoin to be only a store of value or only digital cash misses the point. It should be both.

[timfrietas]

Gold is only a store of value, even less so than Bitcoin. With Bitcoin I can actually buy things, both via e-commerce and locally if I am motivated enough to.

If I walked around with a bunch of gold coins I would have a harder time.

Cashing out is even more difficult (as someone who grew up in California's gold country and knew many a gold bug, it involves humans and haggling).

The difference, of course, is that gold used to be currency, then was the backing for currency, but then that was abstracted away. Bitcoin essentially replaces rare-earth mining with it's own, in theory "repairing" this abstraction with cryptography.

The total value of gold ever mined is about $8 Trillion, something like 50 times more than Bitcoin. There's probably a lot more value just stored in gold that isn't being exchanged every day for goods and services than the total market cap of Bitcoin.

[lawn]

Gold is not only a store of value. It has industrial use and also as decoration.

As you point out gold isn't a perfect store of value either as it has liquidity problems.

[0bsidian]

I don't want to sound condescending, and if I do I apologise, but anyone who has any familiarity with financial markets knows that the industrial applications of gold account for a negligible percentage of its price.

[0bsidian]

Have you ever heard of gold?

Are people buying gold "greater fools"?

If so, why?

[lawn]

Gold was previously used as and in currencies. It also served as scarcity control for paper money (until abolished). To a lesser extent gold can act as money even today.

Nowadays it is also used in industrial purposes and as decoration.

Gold certainly isn't only a store of value.

[clu3l355]

>I can't really think of many reasons why you would use crypto to pay for a coffee or a sandwich if you live in the West (or frankly, even most developing nations).

Credit card companies/banks sell your transaction data for a lot of money, and plenty of unscrupulous players can garner a lot about your life from such data. While BTC is only pseudonymous, it can provide some shielding from this.

[regulation_d]

These credit card companies also charge 3% tx fees. Crypto fees can be much, much lower.

Also coins like Dash have some nice anonymization tools built-in.

[techno_modus]

In this sense, Bitcoin is somewhat analogous to Tor. Both technologies try to overcome various artificial restrictions and natural constraints. However, Bitcoin and Tor target different areas: financial services and access to information, respectively.

[0bsidian]

And if we used blockchain to create a tokenised TOR, we would have something like Orchid Protocol:

www.coindesk.com/tokenized-tor-orchid-blockchain-decentralized-internet/

[leereeves]

> (1) You are from Syria and need to flee war and escape into Europe – however bank transfers into Europe are almost impossible if you are a common Syrian. Bitcoin allows you to take your wealth with you, in your brain, as you escape across the border, by just memorising your twelve word private key.

> (2) You are from Venezuela or Zimbabwe – The government has issued capital controls and is devaluing currency by the day. You transfer your wealth into Bitcoin in order to offset capital erosion due to hyper-inflation. When the situation stabilises, you transfer your Bitcoin back into fiat.

Only if you can find someone else willing to exchange Bitcoin for that problematic currency.

> (3) You are Saudi billionaire Al-Waleed bin Talal. The government freezes all your assets in a political coup. If you have a portion of your wealth in Bitcoin, you could protect them from government expropriation and anonymously transfer them to associates or family members abroad.

The FBI was able to seize Bitcoins from the Silk Road. The Saudis could ask them for help.