Bitcoin will NOT solve all problems but will make rich people richer!

[phelix]

Quite often I read naive posts on this forum like this:

[...]
Bitcoin enemies are the bankster regulator old money families one world government collectivist power-hungry ignorant assholes.

Revolution!!!  (Thanks for the summary, molecular )

Please be aware: Bitcoin will NOT solve all problems in the world.

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments. The advantage of this is that they will also lobby governments and banks.

* In a Bitcoin world there will still be banks.
Might be split key bitcoin-banks but still. A lot of normal people do not like to temper with codes, keys and paper wallets and the possibility of their coins stolen by hackers from their computer.

* Governments will always find ways to milk you.
You think hey, no more inflation. They will come up with some kind of creative new tax so that you will en up paying even more.


If bitcoin will make things more transparent and thus pave the road for political solutions I for my part will be happy.

[hugolp]

and thus pave the road for political solutions

Political and solutions together? I dont really understand this concept. Is this like unicorns?

[phelix]

and thus pave the road for political solutions

Political and solutions together? I dont really understand this concept. Is this like unicorns?

I have a vision of a bitcoin based digital unicorn. But that's another topic.

[ArticMine]

Bitcoin will create rich people but it will be different rich people from those that are currently rich. This has happend with every disruptive technology for centuries.
Bitcoin will bring many opportunites to the world's poor. Why becasue they will no longer need a credit or debit card and / or a merchant account to participate in the worldwide Internet economy

[caveden]

* In a Bitcoin world there will still be banks.
Might be split key bitcoin-banks but still. A lot of normal people do not like to temper with codes, keys and paper wallets and the possibility of their coins stolen by hackers from their computer.

Wise people don't oppose banks per se, they oppose the current banking system (central banks cartels, inflation etc). In a "Bitcoin world", where opening a "bank account" is as easy as opening an e-mail one, we would definitely not have the same system.

* Governments will always find ways to milk you.
You think hey, no more inflation. They will come up with some kind of creative new tax so that you will en up paying even more.

If the volume of taxed money is the same, I'm not aware of any worse way to tax than via inflation directed to the credit market. Any other taxation scheme ever created is economically less destructive than inflation. Basically, even if they keep milking us just as much, the way they milk does make a significant difference. All these brutal economic cycles which destroy so much capital, for instance, would not occur if it weren't for inflation directed to credit.
Plus, another quite destructive taxation type is that which attacks savings and investments, since these are the fuel for future economic growth. Income taxes attack savings and investments. Some argue that a world in which cryptocurrencies are the norm would render income taxation unpractical: http://falkvinge.net/2011/05/19/the-information-policy-case-for-flat-tax-and-basic-income/

[Fuzzy]

Bitcoin will give everyone more control and options with their money, poor or rich. This makes life better and is a good thing. 

[phelix]

Bitcoin will create rich people but it will be different rich people from those that are currently rich. This has happend with every disruptive technology for centuries.

I would say there will be some change mostly among rich people from conservative towards technologically open people.

Bitcoin will bring many opportunites to the world's poor. Why becasue they will no longer need a credit or debit card and / or a merchant account to participate in the worldwide Internet economy

they will also need coins 

* Bitcoin will make rich people richer.

Of course it will.

It will also make poor people richer. Such as those who run small businesses and have been screwed over by PayPal. Such as Africans who work in Europe and pay a fortune to Western Union to remit their earnings back to their families.

What's not to like?

agreed. It will bring plenty of advantages. Hard money for small countries, without having to worry about local speculation or rip of from the issuer (currently the usa is doing this job I think). But there are enough problems it will not solve and some people only think of rainbows.

* In a Bitcoin world there will still be banks.
Might be split key bitcoin-banks but still. A lot of normal people do not like to temper with codes, keys and paper wallets and the possibility of their coins stolen by hackers from their computer.

Wise people don't oppose banks per se, they oppose the current banking system (central banks cartels, inflation etc). In a "Bitcoin world", where opening a "bank account" is as easy as opening an e-mail one, we would definitely not have the same system.

no, we will have mining cartels that create a union to increase tx fees.

* Governments will always find ways to milk you.
You think hey, no more inflation. They will come up with some kind of creative new tax so that you will en up paying even more.

If the volume of taxed money is the same, I'm not aware of any worse way to tax than via inflation directed to the credit market. Any other taxation scheme ever created is economically less destructive than inflation. Basically, even if they keep milking us just as much, the way they milk does make a significant difference. All these brutal economic cycles which destroy so much capital, for instance, would not occur if it weren't for inflation directed to credit.
Plus, another quite destructive taxation type is that which attacks savings and investments, since these are the fuel for future economic growth. Income taxes attack savings and investments. Some argue that a world in which cryptocurrencies are the norm would render income taxation unpractical: http://falkvinge.net/2011/05/19/the-information-policy-case-for-flat-tax-and-basic-income/

Hmm... I can imagine a world free of all this debt pressure. The change will be hard, though. Thanks for the article, will take a look.

Bitcoin will give everyone more control and options with their money, poor or rich. This makes life better and is a good thing. 

And unicorns for everybody. Hope you are right.

Ever thought about a totalitarian Bitcoin world? At birth you get an address hashed from your DNA. If you ever send money to an address that is not ok in the eye of the state you will be punished.

[RodeoX]

Quite often I read naive posts on this forum like this:

[...]
Bitcoin enemies are the bankster regulator old money families one world government collectivist power-hungry ignorant assholes.

Revolution!!!  (Thanks for the summary, molecular )

Please be aware: Bitcoin will NOT solve all problems in the world.

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments. The advantage of this is that they will also lobby governments and banks.

* In a Bitcoin world there will still be banks.
Might be split key bitcoin-banks but still. A lot of normal people do not like to temper with codes, keys and paper wallets and the possibility of their coins stolen by hackers from their computer.

* Governments will always find ways to milk you.
You think hey, no more inflation. They will come up with some kind of creative new tax so that you will en up paying even more.


If bitcoin will make things more transparent and thus pave the road for political solutions I for my part will be happy.

I agree with all those statements. phelix's and molecular's .

[Elwar]

Bitcoin will not purchase happiness for the man who has no concept of what he wants; bitcoin will not give him a code of values, if he's evaded the knowledge of what to value, and it will not provide him with a purpose, if he's evaded the choice of what to seek. Bitcoin will not buy intelligence for the fool, or admiration for the coward, or respect for the incompetent. The man who attempts to purchase the brains of his superiors to serve him, with his bitcoin replacing his judgment, ends up by becoming the victim of his inferiors. The men of intelligence desert him, but the cheats and the frauds come flocking to him, drawn by a law which he has not discovered: that no man may be smaller than his bitcoin.


Only the man who does not need it, is fit to inherit wealth – the man who would make his own fortune no matter where he started. If an heir is equal to his bitcoin, it serves him; if not, it destroys him. But you look on and you cry that bitcoin corrupted him. Did it? Or did he corrupt his bitcoin? Do not envy a worthless heir; his wealth is not yours and you would have done no better with it. Do not think that it should have been distributed among you; loading the world with fifty parasites instead of one would not bring back the dead virtue which was the fortune. Bitcoin is a living power that dies without its root. Bitcoin will not serve that mind that cannot match it.


When money ceases to be the tool by which men deal with one another, then men become the tools of men. Blood, whips and guns – or bitcoins. Take your choice – there is no other – and your time is running out.

[phelix]

[...]
Plus, another quite destructive taxation type is that which attacks savings and investments, since these are the fuel for future economic growth. Income taxes attack savings and investments. Some argue that a world in which cryptocurrencies are the norm would render income taxation unpractical: http://falkvinge.net/2011/05/19/the-information-policy-case-for-flat-tax-and-basic-income/

Sounds good. Like a bright future. That is where we want to go.

[phelix]

Bitcoin will not purchase happiness for the man who has no concept of what he wants; bitcoin will not give him a code of values, if he's evaded the knowledge of what to value, and it will not provide him with a purpose, if he's evaded the choice of what to seek. Bitcoin will not buy intelligence for the fool, or admiration for the coward, or respect for the incompetent. The man who attempts to purchase the brains of his superiors to serve him, with his bitcoin replacing his judgment, ends up by becoming the victim of his inferiors. The men of intelligence desert him, but the cheats and the frauds come flocking to him, drawn by a law which he has not discovered: that no man may be smaller than his bitcoin.


Only the man who does not need it, is fit to inherit wealth – the man who would make his own fortune no matter where he started. If an heir is equal to his bitcoin, it serves him; if not, it destroys him. But you look on and you cry that bitcoin corrupted him. Did it? Or did he corrupt his bitcoin? Do not envy a worthless heir; his wealth is not yours and you would have done no better with it. Do not think that it should have been distributed among you; loading the world with fifty parasites instead of one would not bring back the dead virtue which was the fortune. Bitcoin is a living power that dies without its root. Bitcoin will not serve that mind that cannot match it.


When money ceases to be the tool by which men deal with one another, then men become the tools of men. Blood, whips and guns – or bitcoins. Take your choice – there is no other – and your time is running out.

+1

[Merralea]

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments.

Have to disagree with you there. Those with well-established wealth are incredibly risk averse; they have quite a lot to lose, after all. There's a reason bitcoiners are mostly young and lower/middle class-- they can afford to start over, because they don't have far to fall.

[herzmeister]

Das sind ja Töne. 

I'd also tend to say that Bitcoin tech is an equalizer, just like the internet. Sure, the rich have more internet than the poor, but it gives the poor much more possibilities and chances. Also, Bitcoin may set resources free for those in the first world who genuinely want to help (by not making the third world dependent on Monsanto).

[molecular]

Quite often I read naive posts on this forum like this:

[...]
Bitcoin enemies are the bankster regulator old money families one world government collectivist power-hungry ignorant assholes.

Revolution!!!  (Thanks for the summary, molecular )

Please be aware: Bitcoin will NOT solve all problems in the world.

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments. The advantage of this is that they will also lobby governments and banks.

* In a Bitcoin world there will still be banks.
Might be split key bitcoin-banks but still. A lot of normal people do not like to temper with codes, keys and paper wallets and the possibility of their coins stolen by hackers from their computer.

* Governments will always find ways to milk you.
You think hey, no more inflation. They will come up with some kind of creative new tax so that you will en up paying even more.


If bitcoin will make things more transparent and thus pave the road for political solutions I for my part will be happy.

Oh but it's going to be different! Why? Because bitcoin is a different kind of money (money based on a scarce commodity as opposed to fiat money that can be printed up).

Yes, there will be rich people and some of them will get richer (the ones who make the right choices). But some of the will get poorer (because they make the wrong choices). This is good. Money isn't fair: if it was fairly redistributed every month evenly to every person on earth there would hardly be any incentive to acquire more.

Here is some of the things that will be different when bitcoin become "the one world currency" (sounds bad because of the connotations, but really isn't):

• Governments (if they still exist) will have to get by with the taxes they collect (there's a limit to that). They could theoretically borrow money, but there would be no lenders, at least not to such extent as nowadays. This is a positive difference because then politicians have to actually do their work and try to act in favor of the people (no handouts possible without taking from other parts of the population)
• Governments will be forced to downscale
• People/Companies/Systems making the wrong choices will fail (no bailouts)
• Free markets will thrive. No distorted/false price signals will make the participants blind. No misallocations of capital will effect actions that are not really desired.
  
• The economy will be much more efficient (regarding both the usage of natural and human resources (wear and tear) and the fullfillment of the participants (consumers) needs and wants. People would be happier and humanity would be less destructive towards live on earth.
• There will be less wars.
• Entry to markets will be easier (less protectionism), big corporations will downscale (sell unprofitable parts), lively innovative markets with small and mid-sized companies will be the norm (no monopolies or regulatory capture)
  
• Simple "saving" will be a possible solution to ensure ones well-being after worklife
• The world will be a fairer place.

Now, these points are debatable and I couldn't possible reason them all here and now, but I think you can tell that I am of the opinion that the kind of money we use has immense impact. If you don't think so, I'd like to discuss that.

So yes: there will be rich people, there will be banks, there might be governments... but all of them will have to wake up to a new reality. A reality that in the end is better for all except maybe a few, a bunch I naively call "the assholes". And no, money doesn't solve problems, people do. The kind of monetary system they use can greatly influence their ability to do so effectively.

[tvbcof]

I've felt from early on that Bitcoin is even more amenable to allowing for exploitation than even gold.  And both much more so than fiat.

I've also felt that the barrier to 'the masses' abandoning a solution which is significantly exploitative is much less with something like Bitcoin which cannot be hidden in some hole like gold.  Thus, for those who manage to obtain the reins of power under a crypto-currancy solution such as Bitcoin will be forced to either use their power with some moderation or stand a very real chance of losing it.  That, to me, is the real magic of Bitcoin.

[phelix]

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments.

Have to disagree with you there. Those with well-established wealth are incredibly risk averse; they have quite a lot to lose, after all. There's a reason bitcoiners are mostly young and lower/middle class-- they can afford to start over, because they don't have far to fall.

But not to buy bitcoins. Loosing a couple thousand bucks is not a risk for rich people but playing.

Das sind ja Töne. 

I'd also tend to say that Bitcoin tech is an equalizer, just like the internet. Sure, the rich have more internet than the poor, but it gives the poor much more possibilities and chances. Also, Bitcoin may set resources free for those in the first world who genuinely want to help (by not making the third world dependent on Monsanto).

    You can not speculate on the price of the internet, though.   Things might equal out but it will be a long time.

[...]

Oh but it's going to be different! Why? Because bitcoin is a different kind of money (money based on a scarce commodity as opposed to fiat money that can be printed up).

Yes, there will be rich people and some of them will get richer (the ones who make the right choices). But some of the will get poorer (because they make the wrong choices). This is good. Money isn't fair: if it was fairly redistributed every month evenly to every person on earth there would hardly be any incentive to acquire more.
[/quote]
limited redistribution is an interest of rich people, too. keep the balance, keep the 99% off the streets.

Here is some of the things that will be different when bitcoin become "the one world currency" (sounds bad because of the connotations, but really isn't):

• Governments (if they still exist) will have to get by with the taxes they collect (there's a limit to that). They could theoretically borrow money, but there would be no lenders, at least not to such extent as nowadays. This is a positive difference because then politicians have to actually do their work and try to act in favor of the people (no handouts possible without taking from other parts of the population)

agreed, probably more transparent taxation

• Governments will be forced to downscale

hopefully, but not guaranteed. maybe 33% automatically deducted VAT turns out very effective

• People/Companies/Systems making the wrong choices will fail (no bailouts)
• Free markets will thrive. No distorted/false price signals will make the participants blind. No misallocations of capital will effect actions that are not really desired.
  

what would be different from now?
there can be just as many subsidies as today.

• The economy will be much more efficient (regarding both the usage of natural and human resources (wear and tear) and the fullfillment of the participants (consumers) needs and wants. People would be happier and humanity would be less destructive towards live on earth.
• There will be less wars.

In the transition there might even be more war. I guess that by far the most Bitcoins are in the US. Some people might not like that.

• Entry to markets will be easier (less protectionism), big corporations will downscale (sell unprofitable parts), lively innovative markets with small and mid-sized companies will be the norm (no monopolies or regulatory capture)
  
• Simple "saving" will be a possible solution to ensure ones well-being after worklife
• The world will be a fairer place.

rainbows and unicorns

Now, these points are debatable and I couldn't possible reason them all here and now, but I think you can tell that I am of the opinion that the kind of money we use has immense impact. If you don't think so, I'd like to discuss that.

So yes: there will be rich people, there will be banks, there might be governments... but all of them will have to wake up to a new reality. A reality that in the end is better for all except maybe a few, a bunch I naively call "the assholes". And no, money doesn't solve problems, people do. The kind of monetary system they use can greatly influence their ability to do so effectively.

I fully agree that Bitcoin/cryptocurrencies will probably have a positive impact in the long run.

But there will still be problems in the world, plenty of them even caused by Bitcoin.

I've felt from early on that Bitcoin is even more amenable to allowing for exploitation than even gold.  And both much more so than fiat.

I've also felt that the barrier to 'the masses' abandoning a solution which is significantly exploitative is much less with something like Bitcoin which cannot be hidden in some hole like gold. 

? seems pretty easy to hide bitcoins in a hole.

Thus, for those who manage to obtain the reins of power under a crypto-currancy solution such as Bitcoin will be forced to either use their power with some moderation or stand a very real chance of losing it.  That, to me, is the real magic of Bitcoin.

You mean all or nothing politically? Either a totalitarian or a small state enlightened society? Sounds reasonable to me.

[tvbcof]

I've felt from early on that Bitcoin is even more amenable to allowing for exploitation than even gold.  And both much more so than fiat.

I've also felt that the barrier to 'the masses' abandoning a solution which is significantly exploitative is much less with something like Bitcoin which cannot be hidden in some hole like gold. 

? seems pretty easy to hide bitcoins in a hole.

Thus, for those who manage to obtain the reins of power under a crypto-currancy solution such as Bitcoin will be forced to either use their power with some moderation or stand a very real chance of losing it.  That, to me, is the real magic of Bitcoin.

You mean all or nothing politically? Either a totalitarian or a small state enlightened society? Sounds reasonable to me.

There is no realistic direct replacement for gold, for instance.  OTOH, a clone of Bitcoin is mainly indistinguishable from the 'original' once a blockchain is reasonably developed.  Except that some more inflation is possible, the shit-heads who hold value in the abandoned chain are SOL, and whatever secret keys they buried in a hole are as worthless.  So, the take-away for the owners of a dominant crypto-currency would be don't be shit-heads...distribute the wealth or the masses will do it for you.

Now do you see my point better?

[phelix]

I've felt from early on that Bitcoin is even more amenable to allowing for exploitation than even gold.  And both much more so than fiat.

I've also felt that the barrier to 'the masses' abandoning a solution which is significantly exploitative is much less with something like Bitcoin which cannot be hidden in some hole like gold. 

? seems pretty easy to hide bitcoins in a hole.

Thus, for those who manage to obtain the reins of power under a crypto-currancy solution such as Bitcoin will be forced to either use their power with some moderation or stand a very real chance of losing it.  That, to me, is the real magic of Bitcoin.

You mean all or nothing politically? Either a totalitarian or a small state enlightened society? Sounds reasonable to me.

There is no realistic direct replacement for gold, for instance.  OTOH, a clone of Bitcoin is mainly indistinguishable from the 'original' once a blockchain is reasonably developed.  Except that some more inflation is possible, the shit-heads who hold value in the abandoned chain are SOL, and whatever secret keys they buried in a hole are as worthless.  So, the take-away for the owners of a dominant crypto-currency would be don't be shit-heads...distribute the wealth or the masses will do it for you.

Now do you see my point better?

Maybe I should note: the last sentence in my post above was not meant sarcastic.

About gold.....  why don't you buy some Rhenium (there is 5x less in the Earth crust but it is currently 15x cheaper than gold) and make it the new gold?

Gold gets its value only by tradition and so might bitcoin.

[Grafzep]

* Bitcoin will make rich people richer.
The establishment is always looking for investment options and they don't mind loosing a couple thousand bucks. Besides some early adopters Bitcoin will mostly make rich people richer as only they can do high risk investments.

Have to disagree with you there. Those with well-established wealth are incredibly risk averse; they have quite a lot to lose, after all. There's a reason bitcoiners are mostly young and lower/middle class-- they can afford to start over, because they don't have far to fall.

I'm afraid you've been misinformed. The wealthy are not risk-averse at all. Sure the core money (often in trusts or invested by near-blind portfolio managers) will be boringly held, but at the edges they have play money that they enjoy gambling. They could happily drop 50k on a party or maybe a bitcoin punt just for the chance to look clever later. IMO its the first sightings of some of these that are fuelling the current rise

[tvbcof]

There is no realistic direct replacement for gold, for instance.  OTOH, a clone of Bitcoin is mainly indistinguishable from the 'original' once a blockchain is reasonably developed.  Except that some more inflation is possible, the shit-heads who hold value in the abandoned chain are SOL, and whatever secret keys they buried in a hole are as worthless.  So, the take-away for the owners of a dominant crypto-currency would be don't be shit-heads...distribute the wealth or the masses will do it for you.
...

...
About gold.....  why don't you buy some Rhenium (there is 5x less in the Earth crust but it is currently 15x cheaper than gold) and make it the new gold?

Gold gets its value only by tradition and so might bitcoin.

Operationally, a switch from gold to rhenium (to use one of the few vaguely theoretically possible alternates) would be a significant undertaking.  Mining, processing, minting, distribution, etc.  A crypto-currency, OTOH, could achieve a much more satisfactory drop-in replacement solution with an effort of one man-evening of hacking in his den.

That said, I am sure that there is some element of 'tradition' in Bitcoin and other crypto-currencies, and it is a big question mark in my mind as to how much of a factor that will be in practice as we move forward.