Yet another vector for power elite takeover

[townf]

If crypto-money reaches critical mass in popularity and starts really threatening the power elite, then it will be used as reserves to issue redeemable notes and accounting entries on by the current banksters. We will then use these notes and accounting entries as money.

The banking institution used to do this with gold, now they use monetized government debt as reserves. Since monetized government debt is such a criminally stupid specie, and banks are ready poised to issue notes and accounting entries on anything (they already have a convenient branch location near you!), then they will do it. They will even get the government to legislate that nobody counterfeits their physical notes and coins.

This might be an acceptable compromise for some people. Crypto specie is totally superior to monetized government debt specie. It is arguably superior to even precious metal in this day and age.

These banks will still be private corporations though. Maybe governments will grow a pair and take the money power away from these private banks during this transition, but that is a totally wishful fantasy.

The community could possibly hurry up and create some kind of decentralized p2p banking mechanism to do this for us, like a network of kiosks or atms or software clients run on your own computer. That would totally kick ass.

[Etlase2]

If crypto-money reaches critical mass in popularity and starts really threatening the power elite, then it will be used as reserves to issue redeemable notes and accounting entries on by the current banksters. We will then use these notes and accounting entries as money.

This is only viable if the people cannot create new money. So it will be solved by either creating another currency to avoid the control that bitcoin so easily affords, or dropping the idea that a limited supply commodity has any hope of being a legitimate replacement for fiat.

[optimator]

If crypto-money reaches critical mass in popularity and starts really threatening the power elite, then it will be used as reserves to issue redeemable notes and accounting entries on by the current banksters. We will then use these notes and accounting entries as money.

This is only viable if the people cannot create new money. So it will be solved by either creating another currency to avoid the control that bitcoin so easily affords, or dropping the idea that a limited supply commodity has any hope of being a legitimate replacement for fiat.

Yeah, the thing is that after you loose faith in the country that created the currency that failed, it takes a lot for that country to create a new currency. Look at the number of attempts the Weimar Republic tried after the Mark went into hyperinflation.

[Etlase2]

Yeah, the thing is that after you loose faith in the country that created the currency that failed, it takes a lot for that country to create a new currency.

Good lord man, I am referring to another cryptocurrency.

[townf]

If crypto-money reaches critical mass in popularity and starts really threatening the power elite, then it will be used as reserves to issue redeemable notes and accounting entries on by the current banksters. We will then use these notes and accounting entries as money.

This is only viable if the people cannot create new money. So it will be solved by either creating another currency to avoid the control that bitcoin so easily affords, or dropping the idea that a limited supply commodity has any hope of being a legitimate replacement for fiat.

Inert notes offer anonymity, higher adoption rate in the local physical world, instantly verified transactions, and reversibility of transactions. The masses will have high demand for all these things in their money. It's going to be pretty much mandatory for true adoption.

Notes can be issued on anything, any cryptocoin, any metal, any stores of grain, any commodity, at any time. They're just receipts. But transacting commerce with these receipts offers all the benefits I just described. The non-physical, cryptographic, public nature of cryptocoins make it so the said benefits do not apply to commercing with the commodity itself.

Any entity that people trust not to evaporate and disappear with their commodity can successfully issue and redeem notes on anything at any time there is a demand, including right now. They just have to come up with a way to successfully identify counterfeits.

Sorry, but I don't follow how you think it is not viable.

I don't think it's possible to create anything that is impervious to: "You can give me that thing and I'll write you a receipt for it, and we can swap back anytime you want".

The fiat system is totally crapping itself. The only possible replacement is a limited commodity reserve currency. Any central bank that can is actively acquiring gold right now. It is far superior to the type of fiat system that exists as it does today. The only other option is government issued, debt-free fiat, but the banksters that run governments and the media won't let that happen.

[Etlase2]

Inert notes offer anonymity, higher adoption rate in the local physical world, instantly verified transactions, and reversibility of transactions. The masses will have high demand for all these things in their money. It's going to be pretty much mandatory for true adoption.

None of those things absolutely require a representation of the currency rather than the currency itself--meaning digital currency could be transacted physically in a way similar to gold coins, but with data. We are still at the dawning of the digital age and the only the birth of digital currency. MintChip technology at least proposes to do this with Canadian dollars. Of course that is a highly centralized version, but I don't see why there couldn't be a decentralized, secure way in the future to do it with cryptocurrency.

To me it seems like you are giving up to the inevitable return to the same systems we have in place now. I think you think that way because you realize how terrible bitcoin really is as a currency, even if perhaps you won't even admit it to yourself--but I am guessing, I don't know your posting history very well or anything. It is not the due to the properties of cryptocurrency that these systems will inevitably return, it is the due to the properties of a limited commodity currency.

I don't think it's possible to create anything that is "You can give me that thing and I'll write you a receipt for it, and we can swap back anytime you want" proof.

That is not at all what I meant. You understand bitcoin's properties well enough that you see where it is eventually headed were it to remain the dominant cryptocurrency. I say that there is zero chance of that happening. Bitcoin is massively flawed, but that's kind of ok because it opened pandora's box.

[optimator]

Good lord man, I am referring to another cryptocurrency.

Oops! I was replying to an argument I was having with myself about an alternative failure.... we'll just leave that one alone.

[townf]

etlase2 if you go to:
https://bitcointalk.org/index.php?topic=191175.0
and put in your opinion/ideas i would truly appreciate it. I was calling for ideas on a decentralized p2p network of atms to crank out notes. To make them more easily counterfeit-proof, it could spit out smartchips as notes whose puks are stored in the network. Not sure how mintchip works.

Also there has been discussion in various places about whether it is possible to totally trustlessly guarantee that the cryptocoin privkey on something like a casascius coin or a bitbill is unknown even to the maker. I'm not thinking possible, although could something like zerocoin accomplish this physically?

[Etlase2]

I have only considered how I could design something in a cryptocurrency to make it easier to use as a physical currency, I have not spent any time really on how to actually accomplish the physical part. I have only the beginning of an idea of how to make physical denominations be stored on the network more easily. Like a $20 bill is tied to a specific transaction on the network. It really doesn't accomplish much except to provide other ways for anonymity. But if the technology to somehow securely carry around physical representations existed (or move the value irrevocably into those systems), it would fit with that system better than the traditional transaction model.

I could spend a lot of time thinking about this stuff, but it would take time away from where I need to direct my efforts, so I apologize but I wouldn't be able to add too much to your discussion--but I do think it's a discussion worth having.