This thread has taken multiple related but contradicting paths and I'll accept the blame. It's been a thought experiment, not a thesis, and I appreciate the evolution of the discussion.
#1 Does a money need to be or benefit from being a commodity?
#2 Are there commodities or services which only something like bitcoin could monetize?
#3 Can bitcoin become or be replaced by a digital commodity?
#4 Can credit be money?
I've certainly flip-flopped on all of these (Currently: maybe, yes, maybe, no) and have changed the topic title, though I doubt any fits.
The notion that something used as money ought to have independent value is fundamentally broken. ... there will be some price ... most efficient use of that good possible. ... some scarce thing used as a highly liquid exchange placeholder, a money good, there will be some valuation at which it does its job best ... It is unlikely that these prices will be the same, or even similar. So when you combine the uses you get something which is less efficient than having them separate.
I find no fault in your argument. But I wonder if that inefficiency (the difference between industrial and speculative/money value) provides stability, and thus adds to its value as a money. Gold has a quantifiable industrial value and a less quantifiable but no less real desirability (jewelry). Not only does this provide a base, but I posit that the existence of some base prevents the exchange rate from even approaching the base. Whereas a thing such as bitcoin with no base will forever carry a psychological uncertainty reflected in its volatility.
Just as a hypothetical example, suppose a bitcoin represented a GB of storage in the cloud (in the blockchain perhaps) in addition to all of the properties it enjoys today. At $0.06 that GB might have been well justified. Even if after bitcoin was discovered to have wonderful monetary value, I wonder if speculation could have brought the price up to $32 so early or that it would have depreciated 1% daily ever since. It's pure conjecture, of course.
How would you ensure people kept their promises of future work?
This question continues to nag me. In light of Gmaxwell's notion of a 'pure money', perhaps we don't want money to have industrial value, and certainly not to base our money on credit. That last point should be self-evident.
While I think computational work and storage would make excellent fungible credit, it's a terrible 'store of value' even if the price were more stable. In my opinion a 'store of value' is not retention of stable purchasing power, but the conversion of promises into things. Money unbinds credit from a domain of specific promises to a larger domain of generic though negotiable value.
I didn't necessarily mean the ripple system/implementation. All I meant is things become much simpler, and arguably more robust/decentralized when you consider an "everyone an issuer" model like ripple rather than "single issuer" like USD/bitcoin
As long as we're trading apples for apples ("I'll replicate 1 GB of your data for 1 GB of my data"), I agree with you. But I don't see this model extending very far. Ultimately, I want a GB/day credit to be honored equally and universally (fungible, divisible, liquid). The handful of friends who might replicate my data are no more reliable than an open (futures?) market where risk can be priced in.
"Everyone is an issuer" of credit, but not money. My friend could easily default on his promise. So, while I'm sure he'll make it up to me somehow, his credit makes terrible money because it is not generally accepted nor immediately useful.
This could be all automated and be more reliable than between friends. Any Joe installs some software and allocates a few GB to the network's disposal and sets a few of his own directories to be replicated with different levels of reliability expectations. We could randomly verify promises are kept. Credit could be immediately applied (the network replicates an amount of my data now equal to the amount I currently host for others). But everyone could agree to honour positive credits at diminishing rates into the future. Tit-for-tat should work just as well for a dozen participants as for a billion.
As long as I am an active participant, particularly with a long reliable history, there's little reason other's shouldn't trust me to honor credit into a proportionally long future. The risk, at least, should be calculable.
Perhaps you've noticed I've added "positive credit at diminishing rates". If you have been actively and reliably replicating data for a year, I can trust you'll continue today, probably for the week, why not another month, but for another year? Eh, maybe. I wonder if this depreciation in trust or reliability can be simulated by monetary inflation. If for every excessive GB/day you are awarded a storage credit (SC), then every new SC depreciates the value of all of the SC in circulation. Now suppose each SC unit also depreciates as a function of its age and the growth rate of SC.
I've sketched out a working model on paper (ignoring the double-spend/unique-digital-unit problems), but I'd like to see if this idea catches any bites.
Also by linkdumping I want to emphasize many people have had these ideas for a long time, so IMO the important question to ask is: why haven't these taken off? My belief is the reason is largely that to most people "things are free already" while really, they are micro-paying via providing private social/ad/marketing data to intermediaries. That is a nasty problem: these systems are incredible, but noone will use them as long as they believe the systems they use today are "free".
Yup. And I have to ask: Where are you getting these wonderful resources? I'm worried that for every idea I've ever had, you could find a well researched paper or implementation to knock me down.
Keep them coming. I'm reading them all!
old ideas, so why haven't they taken off?While I didn't realise everything (to the sentence) in this thread has already been dreamed and tried by geniuses, I believe here we have fertile ground. Whether bitcoin succeeds or fails, we've collected a huge amount of like minded individuals and hardware. The launchpad is prepared.
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