Bitcoin Is Not Really A Good Money

[Babyrica0226]

Bitcoin was a good currency /money to me, because all my weekly expenses is being sustained by Bitcoin, not only that all my monthly bills also bitcoin paid all of it and the most important was bitcoin is giving  me a savings for the future, particularly I believed it will become  10, 000$ or more by next year 2018 by march. So, bitcoin is obviously a good money, In fact in the other country it is legal in Japan, China, Russia and upcoming country that they will make it legalize are India and Korea.

[MarconyGL]

For me, bitcoin is good money, because it helps improve the financial situation and improve the economy of the country. Many have already noticed its positive effect and want it to develop.

[Kprawn]

Bitcoin's real strength is in it's disruptive nature. It can force changes in the banking sector and also in remittance services,

where there has been exploitation for years, because these giants were backed by governments and funded by Taxpayers.

It sucks as a currency, because the fees to use it is currently too high. These problems are only temporary and it might

change in a matter of a few months. {just by making a few code changes} 

[quarkyplum]

Maybe you have mistaken, I think if call Bitcoin is money, it not wrong because we can exchange it to FIAT and the value of Bitcoin not small, very high and high than gold. This is reason I can say Bitcoin really good money, but about asset, still need the time confirm.

[The_prodigy]

I know, Bitcoin is designed to be as free from central bank and politician control as possible.  It is open-source, decentralized, etc.

But if you think about it, Bitcoin is still fundamentally worse than gold and silver as a truly free money.

First things first: all of gold, silver and Bitcoin are subject to central bank manipulation by pegging.  When central banks store up enough non-state money, they can sell that money for a fixed dollar or pound price, and thus suppress any appreciation of the non-state money in currency terms.  This enables the elites to acquire wealth and power for free, by issuing state currency and debt, as long as the central bank has enough of the non-state money to fight off any 'run on the bank.'

This was the real nature of the gold and silver standards through most of modern history, that mainstream economists praised for stabilizing state currencies and economies, at that time.  (Of course, they are now firmly against the gold standard, thus both times saying the elites' system was/is good for the economy.)

That said, Bitcoin suffers from the additional problem that it's secured not by physics, but by algorithm.  Algorithms can change.  Algorithms are only guarded by humans who are subject to persuasion.  At some point, the elites will have issued too many IOUs against the Bitcoin in their vaults.  Either we increase the issuance limit from 21 million, or we get a financial crisis and depression.  I imagine most of the developers will be open to talking.  (BTW, some version of this is almost guaranteed to happen, due to the nature of the world system.  For example, all countries have defaulted on their promises to redeem gold at a fixed price.)

This is in contrast to gold and silver, where violating the limit of issuance is physically impossible (or very expensive, with radioactive reactions.)

Another major weakness of Bitcoin is transparency.  In order for the public to hold the elites accountable for their monetary actions, however partially, the easier it is to observe and monitor the system, the better.  The reality is that computer networks and data structures are not easy for most of the public to understand, compared to the age-old concept of holding physical metals.

And we know from experience that the elites take full advantage of lack of public understanding.  Besides the 'gold standard good, gold standard bad' flip-flop by establishment economists, almost every major issue of finance is distorted before the public receive the wisdom passed down to it by the media (and this includes, maybe especially includes, channels tailored to the highly educated, like The Economist magazine and America's PBS television.)  Southeast Asia in the 90s, Greece recently, and Germany between world wars were made to suffer deflation after their financial crises, and the economic justification was 'moral hazard.'  The US was allowed to print devalued money to ease the pain after its own financial crises, and the economic justification was Keynesian pain relief.  (The real reason for the differentiation was that American voters had more power to disrupt the elites' system than those other populations.)

With Bitcoin so much easier to manipulate than gold and silver, no wonder, all the signs are that the elites will promote Bitcoin as the store of value of the future.  This makes even more sense when you consider it would be embarassing for the elites to promote gold or silver instead, since their prices would have to rise to a level much higher than the last time the elites tried to fix them.  Gold has appreciated 30 time since the elites' fixed postwar price of $35/ounce, and would likely have to appreciate another 30 times before a new (de-facto) gold standard can become stable.  This does not make the elites' money look good.  Bitcoin has no such history, and the elites can claim (and likely be believed) that they are merely moving money onto a new, electronic foundation that is more stable than a totally fiat system.

As I mentioned before, the elites must secretly nurture, if not openly promote, some form of safe store of value that is totally trusted by the public.  In today's world, that can only mean non-state-issued money.  The only question is which.

I think bitcoin is a currency that is not neccasarily easy but given time and effort can be something that can work to almost anybody with or without experience. BTC has proven time and time again that it is not easy money that some preach it to be, but it can be something that can give you its benefits if you really work hard for it. The problem with BTC I guess is its lack of educating the masses and that is why some people shy away from it instead of gravitating towards it as some people preach that this is an easy way to earn money and if they encounter any hardship they retract.

[WatchMaker]

Great observation OP... But what you should understand is elites are always one step of the masses.
Elites are wiser than the general public. Whenever we create something new and good for the masses they always step up and taste it.
When the taste so sweet they buy it all before the masses even know about it. Don't worry bitcoin is not the only cryptocurrency in the world soon the other altcoins will emerge.

[bajing]

With Bitcoin so much easier to manipulate than gold and silver, no wonder, all the signs are that the elites will promote Bitcoin as the store of value of the future.  This makes even more sense when you consider it would be embarassing for the elites to promote gold or silver instead, since their prices would have to rise to a level much higher than the last time the elites tried to fix them.  Gold has appreciated 30 time since the elites' fixed postwar price of $35/ounce, and would likely have to appreciate another 30 times before a new (de-facto) gold standard can become stable.  This does not make the elites' money look good.  Bitcoin has no such history, and the elites can claim (and likely be believed) that they are merely moving money onto a new, electronic foundation that is more stable than a totally fiat system.

I think there is price manipulation also on gold and silver price even in the stock market, manipulation can also be done. Yes indeed it is done by a group of people who have a lot of money but as long as we are smart, i think we can used that situation to our advantage. "we will not forever invest our in bitcoin."

[kpcian]

I don't think so, nowadays Bitcoin is getting accepted most of the virtual service and becoming a popular currency in the developed countries. A lot of renowned company have declared that Bitcoin could have been accepted as a transaction tool. Apple store, MacDonald, Pizza hut and so many business platform announced as like. So Bitcoin is really a good enough money at present.

[Cacingkemi]

Well i can say that bitcoin is a good money because of the price increase is not stable but only good for internet transaction not for local transaction because its always need internet before you can send bitcoin to the receiver.. its just like a gold or sliver but the demand is really fast and the movement of the price is really increasing fast unlike gold even its in demand the price is not really increasing fast..
Bitcoin is a good thing online that you can use to buy soemthing and pay for less fee for paying transactions. i don't think that bitcoin is not a good money but there are many people are getting benefits in bitcoin..

My opinion is very very agree with you. BTC is real the currency of the future, with the development of the times as now BTC fits perfectly with modernization. We do not need to bother bringing a wallet or a visa card, just bring a cell phone and start to shopping.

[pearlmen]

OP has really made some valid point based on the analysis that he put forward but the conclusion in which I can add is that, most of those things he sees as an advantage gold, silver or even fiat are the disadvantage that bitcoin came to solve and nothing can be substituted for freedom no matter how lucrative and that's what bitcoin has that supersedes every other options and alternative OP put forward.

[allthingsluxury]

Bitcoin is light years ahead of fiat money, which is still our predominate system that we use.

It is a step in the right direction and it is much easier to transact in, than precious metals currently.

Is it better? I wouldn't say that, precious metals is backed up with over 10,000 years of history, as being a safe store of value. BTC however, does not just function as a store of value, it has many other valuable applications, that should NOT be overlooked.

It is not apples vs apples. They are quite different and to simply BTC is a disservice to it.

[BobK71]

I will contend that.

1. Bitcoin has many advantages over both gold and silver. Bitcoin is easier to transact and buy/sell with than a 2 pound gold/silver nugget. Bitcoin is easier to store and keep safe than gold/silver. Bitcoin is more portable. Bitcoin is more difficult to counterfeit than gold/silver bars. If bitcoin is stolen it may also be easier to track down and recover than gold/silver due to the publicly accessible ledger and a good portion of the internet containing logs which allow tracking of transactions to a relative degree.

These are real advantages of Bitcoin over gold and silver, but they all come at a cost -- making the system more complex and contingent (ie contingent upon there being electricity, cross-device communications, etc., and most important of all, upon users being able to trust an electronic rather than physical system -- there are multiple points along the path where deception can be introduced in such a complex system.)

My main point was that this complexity and contingency make the system fundamentally more vulnerable to abuse and fraud than a gloriously simple, stupid and honest physical store of wealth like gold.

There are times in life when we need simple and stupid honesty.  I contend that, in the world we live in, money is one of them.

2. Bitcoin's algorithm is a major advantage being a creator of long term value. The second people have control over something like ethereum or bch is often the second they sacrifice long term value for short term gain. We can see this in many crypto and fiat currencies which are manipulated to produce short term gain, rather than long term value. People criticize bitcoin's algorithm but also fail to acknowledge the algorithm has proven much more reliable and stable than more arbitrary and often greed driven human regulation.

If Bitcoin is more long-term oriented than Ethereum and Bitcoin Cash, isn't gold or silver even more so?

[UsernameBitcoin]

Bitcoin is light years ahead of fiat money, which is still our predominate system that we use.

It is a step in the right direction and it is much easier to transact in, than precious metals currently.

Is it better? I wouldn't say that, precious metals is backed up with over 10,000 years of history, as being a safe store of value. BTC however, does not just function as a store of value, it has many other valuable applications, that should NOT be overlooked.

It is not apples vs apples. They are quite different and to simply BTC is a disservice to it.

Sorry but this is not entirely true. Bitcoin is not necessarily light years ahead of fiat at least in most respects. See, fiat can be transacted in a matter of seconds but Bitcoin transactions take up to 24 hours to confirm if you use a fee that is anywhere realistic to what you would need to do micro payments like anything under $5.00 which are obviously very common in most of the world. It has a long way to go still.

[skyline247]

Bitcoin is money. And it is good money. However, maybe it could be said that it is not great money. Why? Because transactions are too expensive and take far too long.

[Kidmat]

Bitcoin is money. And it is good money. However, maybe it could be said that it is not great money. Why? Because transactions are too expensive and take far too long.

Bitcoin is more than money because we can buy good online by using bitcoin as payment. Transactions you said may take long because of the transactions fees. Bitcoin advantages than real money with its value is volatile that users grab this opportunity to earn more money.

[Rahar02]

Depends on which side you look at it; disadvantages could be advantages.
-  Bitcoin price could be maniuplated? Yes, it can be, and many people already did it. But, for those who can hold for long term and sell
   at high peaks will get bigger profits.
- Never heard about security problems regarding bitcoin algorithm, so it just your speculation. But, everyone could test the algorithm
  and notify the devs team if there's any leak.
- Bitcoin transparency is another advantage, it's not fully transparent but everyone could check every transaction as it's recorded in
  blockchain.

[Hydrogen]

Bitcoin's algorithm definitely isn't an advantage over gold, because it was modeled on gold to begin with. There is only a certain amount available (like gold), as time goes on it gets harder to mine (like gold) and thus becomes more rare and the price or demand increases (like gold). This is why it is called virtual gold in the first place. :p

Bitcoin's algorithm could be an advantage over gold as its control over the supply of bitcoin is arguably better than any regulation or control over the supply of gold.

If you want a real world example of this look into how the supply of aluminum and other metals is manipulated to artificially move prices.

These are real advantages of Bitcoin over gold and silver, but they all come at a cost -- making the system more complex and contingent (ie contingent upon there being electricity, cross-device communications, etc., and most important of all, upon users being able to trust an electronic rather than physical system -- there are multiple points along the path where deception can be introduced in such a complex system.)

My main point was that this complexity and contingency make the system fundamentally more vulnerable to abuse and fraud than a gloriously simple, stupid and honest physical store of wealth like gold.

There are times in life when we need simple and stupid honesty.  I contend that, in the world we live in, money is one of them.

Wait. Have you been watching the Mr. Robot tv show? Cause that's probably the only example I can think of where a massive electronic attack could destabilize and cause tremendous upheavel to society.

I don't know what to reply to that. If the system is complex and a lot of the data is erased, there are so many redundancies and copies of the blockchain downloaded that it could be difficult to replace or introduce a catastrophic single point of failure.

Also it might be said that people rely upon electrical for everyday life. We already trust electronic systems with virtually everything. Does it make a difference if we add one more system to the list?

If Bitcoin is more long-term oriented than Ethereum and Bitcoin Cash, isn't gold or silver even more so?

One might say: gold and silver aren't as long term oriented as bitcoin for several reasons.

1. There isn't any support for buying or selling with gold/silver/precious metals. It might be illegal to do so.
2. Gold/silver has less active users worldwide, a smaller community and user base.
3. Most people wouldn't know what to do with gold/silver if they had some. There's no knowledge or information surrounding it that the average person can relate to.
4. If someone had 50 pounds of gold/silver the police would probably confiscate it or it might be stolen. Bitcoin may be much easier to store and keep safe over the long term.

There are possibly many reasons why gold/silver would not be a better store of long term value than crypto.

[batang_bitcoin]

But if you think about it, Bitcoin is still fundamentally worse than gold and silver as a truly free money.

Well I'm thinking all the time that bitcoin is a good money. You're the only one I guess that only thinks it's not. Basically I'm not looking at it only as a money but mostly I'm looking and treating on it as an investment. That's why those gold, silver investors are hopping in today's bitcoin craze and happily seeing their portfolio progress.

[GreatOrchid]

Obviously that banks only cares about truly commodities like gold or silver, or any other metal, just because of money, and money means power.
They can not afford to lose "money" because of bitcoin, so there is gonna be a war betwene bitcoin and banks, because btc is occuping the territory of the banks.
But yes, it is money in the end, or you can not use it to buy things? I do.. So its money, enjoy that.

[TexasHuck]

I think through solid development, the evolution of BTC will continue to solve many problems including the "Free Money" concept.

Huck