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by enknamel
3069 days ago
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And all of those points is why it is a poor currency. Great we can fork at any time and from any single transaction. So, we can essentially make infinite currencies. That's hugely wasteful and causes mass inflation. It makes it hard to invest, or even take seriously, a currency that may become worthless tomorrow. If you add some centralized backing, like with USD for example, you get way more clout. What would bitcoin be worth if it had government backing and insurance? I think it would be hugely more valuable and attract a lot more interest. As it is now, it is too speculative, and prone to wild swings in pricing. Also you get people who want it even more decentralized by making it ASIC resistant vs people (China) who want to keep it ASIC based to restrict access. It's just a mess right now. |
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Okay. One of the appeals of cryptocurrencies to anti-government types is that there is predictability and transparency over new currency creation, since it's hard-coded in an algorithm. We can find out exactly how many Bitcoins there will be in five years. Granted, forks can change those algorithms, but they're still transparent. Also, forks of the Etherium Classic or Bitcoin Cash type don't really count as inflation, since you cannot send ETC when the receiver is expecting ETH, and likewise with BCH/BTC; they are not interoperable. In other words, the Bitcoin Cash fork did not cause inflation of core Bitcoin.
Now let's consider USD. Do you know how many USD there will be in five years? USD creation is at the whim of legislators and unelected bureaucrats who could collude tomorrow to crash the value of USD by just letting the printing presses run and there's not really anything that most of the users of USD, the normal people, can do about that. Now I'm not saying that such intentional currency crashing is likely to happen, but that lack of control and predictability is why libertarian types would find the idea of backing cryptocurrency with government fiat currency to be nonsense.