Interesting, now I begin to understand your natural (and frankly, irrational) aversion to bitcoin.
I don't follow the reasoning... I would say that my close encounters with the Amway epidemics in the 1990s, and watching the TelexFree epidemics quite recently, have more to do with it. And 40+ years of witnessing a long string of wonderful technological projects and ideas that flopped...
You have been accustomed to seeing scams. You've seen them probably your entire life.
Well, true. My father went bankrupt in the 1970s after being swindled by his business partner, and two weks ago I caught two students cheating at their final exam. And plenty of other cases in between. Including a dozen cases that I found out when I was department chair, both by contractors and by my esteemed colleagues...
But then, anyone who has led an average life must have run into dozens of scammers too...
There are many scams involving bitcoin as the vehicle of payment, but as far as I know, there is no inherent scam involved in the bitcoin system itself.
That would have been true if bitcoin had remained a technical experiment run by nerds, as it was in 2009, with a few thousand dollars of "market cap". But since it has been redefined as an asset that will "surely" be worth tens of thousands of dollars per unit (as many still claim), it now does have an intrinsic scam.
If the price eventually goes to zero (or to the same level as in 2009), it will have been just like a penny stock scam: those who bought early and got out in time will have made money at the expense of those who were left holding the bag.
But even if it "goes to the moon", the current holders of bitcoin would be able to take hundreds of billions of wealth from the society without ever having done anything in return. I don't know whether that has a name, but it could be called the "private money scam". Namely, someone issues some money-like thing without any backing, keeps a large fraction of it for himself, and tries to have others accept it as currency. Once enough merchants accept it, he uses his stash to buy caviar and Lamborghinis. That is what governments do when they print money to cover their costs, and that is why governments usually stamp out private money.
When you take a step back and realize that the enabler for these scams (bitcoin and others) is the opacity of the ownership of money (and other assets I.e. you give your money to a third party and they do as they please) then you begin to realize that a truly transparent system of transaction has the potential to limit the scope of the scam.
Once you begin to realize the extent of the scam being perpetrated by the current fiat system, then you will begin to realize the true value of bitcoin.
Well, I don't see how bitcoin could have made any difference to my house financing case, or most of other cases of fraud and damages.
Bitcon will not make banks unnecessary. People will still use banks to borrow money and finance enterprises. Moreover, implicit in the hype/hope surrounding the COIN ETF is the realization that most people would rather entrust their bitcoins to an insured bank-like custodian than worry 24/7 about being hacked or tricked out of them.
Very few of the fraud cases that I can think of were caused by opacity about ownership of money. In my house financing case, all the accounting was fully known to all parties, and not in question. The dispute was about whether certain adjustments to the balance due that the banks made in the 1980s were legal or not; and the only imortant thing that we did not know was that our lawyer was criminally incompetent and/or negligent.
Even in cases that involved doctoring books (such as the Enron collapse), I doubt whether bitcoin would have avoided the fraud: the criminals would probably find a way around it. The transparent blockchain did not prevent the disappearance of 600+ kBTC from MtGOX. It does not tell us whether the other exchanges are honest, whether the bitcoin funds are solvent, whether BitPay is really processing a million dollars of sales per day...
Technical people and generalized "geeks" often make the mistake of believing that the right technology can fix social or political problems, like corruption, crime, misery, fraud... In reality, the culprits for those problems quickly learn how to work around the technical solution, or even use it to their advantage.
For example, in 1996 the Brazilian government pushed for, and got, electronic voting for all elections in the country. The excuse was the well-known occurrence of voting fraud and voter coercion made possible by the paper ballots and closed-doors manual counting. It was hoped that the all-digital system would put the votes beyond the reach of fraudsters and corrupt local Election Board officials. But these merely switched to other tricks that the voting machine did not guard against. Worse, the all-digital design created an even greater risk of global fraud by software. Namely, a malicious programmer within the system could steal 5-10% of the votes in all voting stations in a county, state, or the whole country, in total "safety".
Bitcoin is another good example of that fallacy. Bitcoiners hoped that it would be the solution to credit card fraud, bank "censorship", stocks and currency manipulation, government abuse... But in fact it did not solve any of those ills; on the contrary, it has attracted all sorts of scammers and criminals, and police agencies seem to love it. Exaggerated claims about bitcoin being "disruptive" and "changing the world" only make me (and millions others) more skeptical about its future.
Social and political problems can be solved only by social and political means -- by keeping close watch on the government, demanding transaprency, engaging in political campaigns, voting for good policies, etc..
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