2015-03-24 FT.COM Bitcoin’s lien problem

[iCEBREAKER]

Bitcoin’s lien problem

Part of the BitcoinMania series

http://ftalphaville.ft.com/2015/03/24/2122678/bitcoins-lien-problem/

At cryptocurrency and fintech conferences, FT Alphaville often hears Bitcoin enthusiasts make the assertion that Bitcoin is superior to fiat currency because it eliminates debt from the monetary system.

But this, of course, is a fallacy.

Bitcoin may have the potential to create a fully-funded reserve system, but it certainly doesn’t eliminate debt from any system.

At best, Bitcoin’s public ledger records a transfer of digital access rights in the eyes of the clearing network. It does not, however, record or see the terms and conditions of that transfer...

[db]

10 bitcoin comes in to an address of a company. 2 of them are Soprano bitcoins. The company pays 10 suppliers 1 bitcoin each from this address. Where did the Soprano bitcoins go?

[fancy_pants]

10 bitcoin comes in to an address of a company. 2 of them are Soprano bitcoins. The company pays 10 suppliers 1 bitcoin each from this address. Where did the Soprano bitcoins go?

Impossible to answer without knowing which party pissed all their fiat away on Perkins Coie.