[andrewla]

> In 2009, it was the counterparty risks that really amplified the disaster-- all of those CDOs were written assuming there was no possibility of default ... With bitcoin there is no possibility of default, and very high resistance to financial censorship.

I don't really see how this statement can be justified; I can borrow or have contractual obligations denominated in Bitcoin that I fail to deliver, and you are free to value the contract pre-default at its market value and even take loans against it, amplifying the ripple effects of a default.

In my opinion, the real crisis in 2009 was not the failure of the banks and the financial system; the real crisis was the bailouts -- funneling huge amounts of money created just for that purpose to the very institutions that had proven their inability to manage that money.

My hope for Bitcoin is that it makes such a bailout untenable because it would require real money be spent, or unlimited credit be created, which would expose even large central banks to the problems of sovereign default.