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Completely agree. I thought I posted on the other thread about 2020s predictions but apparently I didn't hit the reply button: Bitcoin will definitely singularly emerge as the new common 'numéraire' in the near to mid-term (5 to 10 years). I love that you specifically call out the omnipresent crypto scams, because they are what disappointed me from the whole endeavor once they emerged in the ICO craze. Once 1 bitcoin has price of 500,000 to a few million in USD per individual 'bitcoin' UXTO, it'll be obvious for governments to just start using it, and create dual money systems that are just layers on top of the (maybe single, maybe not) existing, working blockchain, despite its slowness. China is pursuing this now, even in anticipation of large price increases. IMO Bitcoin is definitely the numeraire of the future, and it is certainly not a sure thing right now but I am extremely certain of this. It then becomes so trivial to do aggregate balance of payments calculations without so much sketchy behavior by fraudulent sovereigns that want to represent their own vision of 'real trade' for various purposes, such as economic warfare. For non-finance people, numeraire is a representative abstraction of a 'unit of exchange', used to simplify things. You can then idealize situations like having riskless borrowing, which simplifies many formulae. But this is not an accurate portrayal of reality, (look up sovereign defaults, as one example. Greece, Spain, Italy, some Asian countries at different times, Argentina, Venezuela, etc.) So having a numeraire that isn't sovereign would be really impactful in making all economic participants way more honest, outside of the immediate smaller-scale effects of allowing people to get their cryptos ropped by unscrupulous people on the darknet. From Wiki: "The numéraire is a basic standard by which value is computed. In mathematical economics it is a tradable economic entity in terms of whose price the relative prices of all other tradables are expressed" Anyways, the Bitcoin protocol could definitely fail, for any number of a few different reasons, but at present barring some kind of major technological paradigm shift that breaks existing cryptography (maybe QC, maybe something different) it is uniquely positioned to become the de-facto standard for all balance of payments activity internationally. Scalability issues are definitely a factor, but hey, the mempool is working its hardest until they rewrite the underlying consensus mechanisms to work at larger scale. But as a settlement system and a darknet unit of exchange, it is extremely clear that this is the first hard asset that won't just vanish at the mercy of sovereigns. Very powerful new technology. |