I hope the U.S. does crash... But would it be good or bad for BTC?

[ehoffman]

Well, first thing first, I sincerely do hope that the U.S. finally hit a wall and, like a child, get to learn that there are boundaries in life...  Well, imagine your brother in law borrowing you 20$, then 20$ more, then 100$.  You tell him it's too much, and ask him to pay you back before loaning more money.  But you fear that by asking so, you end up your relationship and fear loosing all you have loaned so far, so you lean him 20$ more...  Well, the U.S. is just that, but with numbers no one can really grasp anymore (let alone some number that only does make sense for a mathematician)...  So, let the world go in tear if that's what it take, but for <insert your divinity's here>'s sake, this must stop.

Ok, rant done, what would happen with Bitcoins in the above scenarios, I see a few options.
- People will invest in BTC, in fear of loosing their 401(k), etc.  That will push price up.
- Gov will speed-up on criminalizing BTC, as they will see it as a fiat sink hole (safe heaven).  That will push price down.

So, what do you think?

My taught of the day, what's worth more?  Think about it?  Some BTC, with it's speculation, price rising and falling, but with well established limits, or something the majority of the mass call "fiat", which have clearly no boundaries, and which if you don't have enough, you just invent more, raise the roofs, as pleased?

- Even a fool with minimum common sense would be able to see that 1 BTC should be worth much more than 1000$.
- But it take a wise to see the irony of valuating BTC with something as futile as fiat.
- The enlighten hope that someday we'll drop fiat altogether for something much more noble as cryptocurrency, which does have hard mathematical limits, and can't be messed with by some high elite minority who decide one day that we need to raise some arbitrary limit here, tweek something there, etc.  in their favor just to evade years and years of misbehaving.

[dree12]

I think the effect will be initially bad, because Bitcoin's value is heavily tied to that of the USD. If the US defaults, that means many US investors, who still form the backbone of Bitcoin, will no longer be able to pump as much money in as that money is diverted to sustaining life. Arbitrage will then pull down Bitcoin's price on EUR and CNY exchanges.

However, after the US stabilizes, people will once again invest in Bitcoin and the prices in EUR and CNY will recover. Of course, price in USD will be up significantly anyhow.

[Zaih]

EXTREMELY GOOD?? I don't see how there's much to question here.

Doesn't matter if Bitcoin is 'tied' to the USD, if it crashes, there will be a mass influx of people looking to get in on Bitcoins reliability due to being decentralized, not to mention the speculators because of this.

Lets hope

[dree12]

EXTREMELY GOOD?? I don't see how there's much to question here.

Doesn't matter if Bitcoin is 'tied' to the USD, if it crashes, there will be a mass influx of people looking to get in on Bitcoins reliability due to being decentralized, not to mention the speculators because of this.

Lets hope

Whether we like it or not, Bitcoin's economy is heavily dependent on the US market. A failure of the US market will cause unprecedented inflation in USD without corresponding increases in XBTUSD price. Such would cause at least a temporary decrease in Bitcoin's value.

[Kupsi]

I trust Max Keiser  

https://twitter.com/maxkeiser/status/389432326070886400

[CMMPro]

Bitcoin isn't the only store of wealth.

During the Cyprus meltdown I read reports that some people bought BMW's, Mercedes etc. just to sit in the driveway (and sell later) rather than lose an unknown percentage of their deposits. Is the US government going to ban the sale of luxury items before they go after alternate currencies?

Gold, Silver, platinum, copper, diamonds, furs, fancy cars, polo ponies, yachts....and yes bitcoins....they can't stop people from throwing their money into alternative stores of wealth to protect their affluence.

Fighting so hard specifically and solely against bitcoin would be such a stupid waste of time when there are other so many other mediums for storage of wealth that exist and are just as easy to obtain and hold.

I would say that they will shut down gold and silver sales along with trying to shut down bitcoin if it ever comes to that state of affairs.

[Habeler876]

I trust Max Keiser  

https://twitter.com/maxkeiser/status/389432326070886400

not so sure about that.

EXTREMELY GOOD?? I don't see how there's much to question here.

Doesn't matter if Bitcoin is 'tied' to the USD, if it crashes, there will be a mass influx of people looking to get in on Bitcoins reliability due to being decentralized, not to mention the speculators because of this.

Lets hope

Whether we like it or not, Bitcoin's economy is heavily dependent on the US market. A failure of the US market will cause unprecedented inflation in USD without corresponding increases in XBTUSD price. Such would cause at least a temporary decrease in Bitcoin's value.

i agree with this.

[Carlton Banks]

All I'll say is, if you're praying for the US to crash, pray also that it crashes in the most benign way possible. The more violent the crash, the more everyone else will be affected too.

[ehoffman]

All I'll say is, if you're praying for the US to crash, pray also that it crashes in the most benign way possible. The more violent the crash, the more everyone else will be affected too.

Well, of course, I don't wish for a violent crash, but at least a good setback.  Something that will say to the American government and their banks that they can't invent money out of the blue, that they can't go on a party and not care about their actions, that they can't go without thinking of future generations.  Something that will make them think "Oh...  Maybe we should stop spending billions for playing God in each and every countries".  Let other people fix their problems and concentrate on their own problems (this, of course, making them realizing that they DO have money problem).

What I would see is:
- Be in default of paying
and
- Get a good depreciation from the major banks.  Say to the world that the U.S. may have problems paying back their debts.  It would be time for China to start collecting the bill for all those dollar-store crap they send to the U.S. "I-O-U"...

Now, with the above scenario, we are left to see what the U.S. will sacrifice...  Would it be on those costly NSA snooping, worldwide wars, etc. or would it be on the back of all the Americans who are giving their sweat everyday?

[byronbb]

I think the mass psychological sentiment is that no one wants the US to fail. The problem is they have become so arrogant to assume the natural laws of economics don't apply to them, that they just might. We are either on the verge of a total power grab by world states, or the whole thing fails and people will have to discover they can run the world without the need for a "God-like" government. I suspect the former is more likely than the later due to that implied by the first sentence. People build up an image of how their lives will play out be with various goals in mind, a massive change in world dynamics threatens those goals, so they will do whatever they can to protect it, even if it means foolishly capitulating to various "demands" in the name of "security". Ie waiving their rights until it becomes too late. As for bitcoin, who knows.

[JustAnotherSheep]

I don't think many people would trust BTC as a "safe-spot" for their money considering its reputation for instability, at least not at first. People don't like to see their life savings rise to the moon and then fall like a rock in a matter of weeks. Gold, platinum and such things are much safer bets, at least until we start mining asteroids  

Besides once the USD falls the BTC will also fall due to how its value is built on the exchanges. After the transition of Bitcoin to a more decentralized and independent form not having fiat currencies as its backbone we can start talking post-apocalyptic economy potential.

[theonewhowaskazu]

It depends. If it really came to a defaullt, people would no longer trust the feds, but they'd also still need to buy food, etc... something you can't currently do with Bitcoin. At the same time, the people selling the food perhaps wouldn't want USD because they no longer trust the USG. It'd be a weird situation, but it seems fairly obvious that it would help Bitcoin, though perhaps not as much as one might expect.

[Severian]

If there's a perception that the dollar is unstable but Bitcoin looks more stable than the dollar, it'll be good for Bitcoin when the dollar crashes. There are so few people in Bitcoin right now relative to the general public that it would only take a small capital flight into Bitcoin to drive the price up. That capital flight will happen when the world becomes aware that the US government can no longer afford to pay for its overgrown military/intel programs, their obligations to benefits and social programs AND service their existing debt while trying to take on new debt.

In the long run, a dollar crash will be good for btc/gold/silver or any other hard commodity that can replace the Federal Reserve Note as a trade unit.

[jamesc760]

If and when the US falls, it will be mark the end of Western civilization and the rise of Chinese empire. I, for one, welcome the Chinese overlords. I love the Chinese system of government; the summary executions, the graft and bribery you have to grease the palms of your Chinese overlords or you won't get anything done, the Great Firewall, rampant theft in intellectual property, the Central Community Party, the heavy handed occupation and repression in Tibet, the Tinanmen Massacre, etc, etc,,, hey what's not to like? Your hope and dream will soon come. I just hope it's not a nightmare.

[Carlton Banks]

If and when the US falls, it will be mark the end of Western civilization and the rise of Chinese empire. I, for one, welcome the Chinese overlords. I love the Chinese system of government; the summary executions, the graft and bribery you have to grease the palms of your Chinese overlords or you won't get anything done, the Great Firewall, rampant theft in intellectual property, the Central Community Party, the heavy handed occupation and repression in Tibet, the Tinanmen Massacre, etc, etc,,, hey what's not to like? Your hope and dream will soon come. I just hope it's not a nightmare.

What about the hoards of Chinese minion idiots that believe all the worst case interpretation spin that's put out on Western governments and that never question these differences in a more critical way (more critical than the horror movie portrayal in the corrupt Chinese media, that is). Don't forget that, that's the worst bit, believing all the over the top bullshit that you're, I mean, they're told

[niothor]

So ... let's hope that the us fails so 300 millions are affected directly and another billion at least indirectly (and when i say affected i mean f** 4 life) so that the current 50k average daily users of bitcoin have a close to real life orgasm sensation.

Now really lately the bitcoin community is sounding more and more like the bildenberg group.

[zeroday]

So ... let's hope that the us fails so 300 millions are affected directly and another billion at least indirectly (and when i say affected i mean f** 4 life) so that the current 50k average daily users of bitcoin have a close to real life orgasm sensation.

Now really lately the bitcoin community is sounding more and more like the bildenberg group.

Don't worry about people. Self-regulation and decentralization will save humanity. I has been f*cked by life many times and it only makes me stronger.

[Cluster2k]

There are many people hoping the Republicans do go full retard this week and push the country well on its way to default.  There's a little schadenfreude there mixed in with a feeling that the USA does whatever it wants, borrows money like there's no tomorrow with no one to say 'enough, live within your own means'.

Dick Cheney: "You know, Paul, Reagan proved that deficits don't matter"

Many thought the Japanese would be the first to hit the wall.  A government that spends a quarter of its entire budget on debt interest, borrows half the money it needs every year.  Pure madness.

[theonewhowaskazu]

So ... let's hope that the us fails so 300 millions are affected directly and another billion at least indirectly (and when i say affected i mean f** 4 life) so that the current 50k average daily users of bitcoin have a close to real life orgasm sensation.

Now really lately the bitcoin community is sounding more and more like the bildenberg group.

Don't worry about people. Self-regulation and decentralization will save humanity. I has been f*cked by life many times and it only makes me stronger.

You're the guy that got his money stolen by the European Union, right?

You're essentially wishing a similar fate on people in the US. Only, at least you technically got to decide if you deposited into your bank. There are many people here are literally legally obligated to deposit in what might be called our Bank of Cyprus.

[ehoffman]

If and when the US falls, it will be mark the end of Western civilization and the rise of Chinese empire.

I actually taught of that too.  Well, for a start, I think the Chinese would be in a good position to make the U.S. their puppet.  In fact, the world is so dependent now on China.

In the meantime, we're seeing news that other part of the world is thinking of creating a new standard money reference, a new reserve, and stop relying on the U.S.  In a sense, I can't stop to see the correlation between that and what happened in the Bitcoin world (remember when the one and only reference was Gox, and now, BitPay and al. joined together and bumped it down as a reference and now using a combination of other exchanges).

I think that the Real World would have something to learn from the Virtual World of crypto-currency.  The line is getting slimmer and slimmer between the two world