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by horsawlarway
1672 days ago
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> Personally I think if bitcoin doesn't overcome some of its hurdles soon it will probably just turn into a form of the existing banking network through legislation. Ok - I think we're pretty closely aligned here. I'm further along that trajectory than you, mainly because I think this isn't really an optional outcome that might be avoided, but rather the only functional end state of a currency: The currency is only as good as the government that mediates its exchange. If mediating that exchange incurs costs, then the government will take steps to either stop mediating those exchanges (ex: China - where all crypto exchanges are illegal by default, so the legal system can no longer be used to offset the cost of those exchanges at cost to itself) or it will bring that currency under control so that it can make those costs predictable and acceptable (ex: The US - where crypto is getting "all the bad bits" added back through legislation) Which means the original intent of crypto only works in this honeymoon period (which I actually think ended not too long after the silk road went down) where it happens to get treated as an asset by a government that hasn't yet found out that they're essentially mediating exchanges in a foreign currency for free (not something most governments want to do). |
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That's an interesting way to conceptualise it but I see it from a different broader perspective: A government is only as strong as its ability to issue/acquire meaningful amounts of a valued currency.
Anything that negatively affects these activities will be killed or subjugated to contribute towards them. Bitcoin in its intended form is detrimental to both of these activities so it will be sabotaged by governments one way or another until it is not.
Bitcoin has unique properties that drive it's adoption but all these properties can be diminished or undermined by laws.
"Which means the original intent of crypto only works in this honeymoon period"
If Bitcoin had managed to gain widespread adoption and a large enough percentage of its users held their private keys then it would have been too difficult and unfavourable for governments to start attacking it.
The unsolved technical issues hindered adoption so Bitcoin has been relegated to a volatile store of value giving government the time to realise the threat and act accordingly. Regardless of how unreasonable, harsh or onerous a set of laws are they can be effectively implemented if the portion and power of people they affect is small enough.