Bitcoin Forum

UPDATE

Firs the money are not created (stamped) by the (commercial) bank (as you mean) but by the Central Bank of every country (or the Authority which have such role in the given country).

If bitcoin will be regulated and being legal (meaning affirmed by you) that's will be good for him in that country. Will be more easily spread and used in that country. But that's all. Bitcoin cannot be used as national currency of no one country for to many reasons. Firs of all because it is owned by it. Second because is decentralized and cannot be controlled only by that (one) country. The are even other factors which cannot allow such adoption. But if it will be possible to be national currency of some country and will be managed right the answer would be that the problems with the overproduction (stamped) money in that country will be much more few.

I don't think that will happen. As the above post already said, bitcoin can be accepted in the government and may be use in several ways but I doubt it can ever replace the value of money. Also the votality of bitcoin will only make it hard for people to pay debt if ever it replaces the debts that the bank can give.

In my opinion, it's never happen.
You can go to lending topic thread and see some user give lending up to 15% for 2 weeks.
That is much more than interest that bank gives in fiat money.

So can bitcoin end public debt? *you're right

I think not.
1. I don't think money creation causes debt. It is the other way around.
2. Fractional reserve banking with Bitcoin is easily implemented as long as people are comfortable letting banks hold their money, and they are. When that happens, and it will, expect massive inflation and a major drop in value.

I don't see banks or better said, nations accepting Bitcoin precisely because their business and profit are made off the very essential features that make the fiat scam what it is today. If you start dealing with transparent immutable ledgers that the Bitcoin blockchain allows, it would be against their agenda.

But with bitcoin as an anonymous payment method that isn't traceable and refundable, the lenders take huge risks too. When the borrower is gone, the money is gone.

Banks have legal control over the money lent out and can take action too.

For this to happen, Bitcoin would have to replace Fiat completely. Since I don't think that Bitcoin will replace Fiat nor this is necessary for Bitcoin to succeed, your hypothesis won't happen in my opinion.

Not necessary. Already, various derivatives are formed already in Bitcoin. However, possession of a real Bitcoin provides protection against uncontrolled emission.

Bitcoin should have no direct impact on public debt, but might have a big indirect one.

Bitcoin's direct competitors are state-issued currencies.  By diluting trust in these currencies, trust in public debt would also be diminished (since public debt is simply a promise to repay the investor with state-issued currency.)

But I think this dilution of trust, especially against the dollar, will come only after a severe crisis.

That would be the ideal scenario but in no way bitcoin can be created. But don't forget there might be entities for example exchangers acting sort of like banks and having people depositing and entrusting the fund to it. Eventually this goes back to the same fiat scenario, the exchanger might actually be using the money for something else and ended up with no liquidity. Whatever number in the ledger might not exist and that is where we have debt.

Not so easy tostop that debt story,derivatives market,bonds investments.There is talk about new financial model in Europe,Even madaime  Legarde from IMF is talking about it,that it cant be longer like that.In that newmodel comercial banks will work only like a financial services,no more landing,creating debt money.In thatcase bitcoin cant help,but bitcoin is kind of alternative.And there is not only bitcoin,there is blockchain,blockchain is  transparency what is so much needed in financial world now

It could be if there was a uniform way to move it fluidly from one form to another.
Until that happens I don't see it happening in the foreseeable future.

I find no relation between public debt and creation of money actually. Public debt may come from borrowing other country's money and creation of money only lead to inflation in my opinion. But even if public debt does have a connection with creation of money, I don't think BTC can do such thing because you can see that lending in BTC have a huge collateral rate due to its untracable property which is risky for lender. This only lead to higher public debt

For this to happen {in theory} all debt created by Fractional reserve in fiat has to be paid. You have to start from a clean slate... Next you have to stop fiat currency from

being used / printed. {This will never happen on a global scale}

How do you stop this clock and then reverse the debt accrued over many years? ----> http://www.nationaldebtclocks.org/

Bitcoin might help a little, but it will not end debt in our life time and many generations after us. We created a problem, that will flow over to many generations after us.  :o

In my opinion governments will not adopt bitcoin, because they can't control as they can do with fiat, and for this reason they will increment the public debt on fiat money.

beleive there is lot of ways to try to control people with bitcoin, maybe they cant control bitcoin but they will try to find the way to take advantage about it, the key here is the word "try", let them try it, if people finally open his minds and start to understand what we have here, things can change.

BTC will cause the end of public debt? lets hope so, at least as we know it now.

In a Bitcoin world debt would be much lower for the simple reason that Bitcoin itself would always appreciate as long as the economy did (or coins are lost).

In order to get a loan you would have to have a very serious project.

I think this would make the world better as people would try to save instead of spend and investments and loans would be more sensible.
I think that would be very healthy for the world and its people :)

Of course Keynesians would prefer more debt, more spending, more waste and burning the world if that is what it takes for more GROWTH!!!!

op is referring to a time were bitcoin is the major currency, even bigger than fiat, at that point the whole bank system and their debt-money printing, the vicious circle will cease to exist

with bitcoin surely there will be less debts, because debtors know that money could not be printed out of thin air like before

Well the interesting part to see is at what pouint does one consider fiat to be "done" and Bitcoin replacing it. How would such a transition happen? Would it be subtle and on a very long term and steady decline or we will see a massive crash? Those are the scenarios that we should be considering and then adapting those predictions to our investments. I think that it will be rather gradual and thats why buying and holding BTC, even if not much, it's mandatory to be done steadily on a monthly basis.

Bitcoin will not cause the end of public debt. In stead of fiat, government can borrow bitcoin to spend. But it prefers not do this. It will borrow fiat and inflate away the debt.

If people have switched to Bitcoin then further printing more fiat would cause hyper inflation really fast.
In a Bitcoin world governments will never be able to borrow money in a realistic sensible manor.

The jig is up, no more free money for people who don't deserve it.