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1. Bitcoins provide an alternative currency to the dollar. This makes sense, but the question is whether this is the best alternative. For example, I can hedge my dollar risk with euros, Swiss francs, yen, etc. Furthermore, those options can pay interest. And one doesn’t need to choose a single currency but can choose a basket of them.
Then there’s also gold and silver, the traditional play against a declining dollar. If one is trying to hedge against the dollar, these options are more than adequate. I don’t see Bitcoin as having an advantage here.
Then there’s also gold and silver, the traditional play against a declining dollar. If one is trying to hedge against the dollar, these options are more than adequate. I don’t see Bitcoin as having an advantage here.
Yep, there are dollars, rubles, euros, franks, Mongolian tugriks, gold, silver, and yep now bitcoin. Some of them are even paying interest (though at the time it is effectively negative one). What's your point here Doug? Never seen a principally new asset class yet? Than check correlation of all those fiat currencies, metals, stocks, bonds etc... Compare with bitcoin. This lack of bitcoin's correlation to other asset classes alone makes it worthwhile to have bitcoins in any balanced investment portfolio. You should know this, Doug.
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2. Bitcoin can be secretly transported across international borders. OK, sure, that seems like an advantage. There’s just one problem: I have no need to transfer large amounts of cash across international borders. Though this feature is often praised by Bitcoin supporters, how many have actually utilized it to circumvent international laws? Yeah, probably close to zero.
Ever tried to send 100$ to your mama in Mexico? Nahh probably not.
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3. Bitcoin allows for anonymous transactions online and helps avoid taxes. Sounds nice, but personally, I have nothing to hide regarding my online transactions. Maybe if I was operating an online business, this would be great, but as a regular consumer, I don’t see any advantages here. After all, I already avoid sales tax by shopping online; and I’m not going to violate tax laws.
On top of this, my favorite online retailers don’t accept Bitcoin; so why exactly should I start using it?
However, if one is doing something illegal, then Bitcoin would seem to be more useful. As has been reported, Bitcoin has been used to sell illegal drugs online. Now, Bitcoin supporters claim that this is overhyped and that these illicit deals are giving Bitcoin a bad name. In reality, I see this as the only comparative advantage of this currency. Sure, one can still be tracked with Bitcoin, but it would be harder than a transfer from a credit card or bank account.
But since I have no intention of buying drugs online or off, the currency is worthless to me. So what’s the point?
On top of this, my favorite online retailers don’t accept Bitcoin; so why exactly should I start using it?
However, if one is doing something illegal, then Bitcoin would seem to be more useful. As has been reported, Bitcoin has been used to sell illegal drugs online. Now, Bitcoin supporters claim that this is overhyped and that these illicit deals are giving Bitcoin a bad name. In reality, I see this as the only comparative advantage of this currency. Sure, one can still be tracked with Bitcoin, but it would be harder than a transfer from a credit card or bank account.
But since I have no intention of buying drugs online or off, the currency is worthless to me. So what’s the point?
Yep Doug, use that credit card of yours and you will be fine. Do not use cash though, because you know, it can be used for drugs and such...
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...Bitcoin doesn’t offer anything unique....
Right... I suppose you can teleport gold at will, Doug.
