Why not just a parallel Bitcoin economy?

[ttookk]

Hey, so I've been thinking, with all this talk about mass adoption flying around and nocoiners calling bitcoiners a cult, maybe the truth is somewhere in the middle. There is definitely something religious about believing that Bitcoin will be the world currency at some point, but I also don't think that it will die off if the majority decides not to bother with it.

Thinking back to the first time I got in contact with Bitcoin, I didn't really think of it as being the "future of money". I kinda drank the kool-aid with the last massive pump. Not that I thought that would be the beginning of Bitcoin taking over, but maybe as a foreshadow of what was to come.

We tend to see things black and white and this is no exception. I have the feeling that even amongst bitcoin maximalists, there is a sentiment of "the whole world or nothing at all", that either at some point, Bitcoin will be the one money to rule them all or it will wither and die eventually. Being who they are in their somewhat religious state, they obviously didn't really bother too much with option two.

But these two paths, boom or bust, are not the only ones available, aren't they. We already have a Bitcoin economy, although I would argue that it is disproportionately small in comparison to Bitcoins current marketcap. Why not just expand on it? Why can't there be a future in which bitcoin exists as an alternative to fiat money?

Why does it seem like everybody is so adamantly pushing for one of two extremes? Isn't it more likely that the truth will lay somewhere in the middle?

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[meanwords]

Yes, you got a point. People tend to see Bitcoin as the one who will replace fiat or it will be a global currency that will replace dollars, I beg to differ. It's either Bitcoin will die or it will be use as a currency for a certain thing. It won't replace fiat but it will be use in something that is convenient.

[jseverson]

I've actually observed that the Bitcoin as an alternative to fiat future theory is pretty popular. I think the same way, and when I talk about it there always seem to be people who agree with me.

The only ones who truly believe Bitcoin will replace everything are the hardcore libertarians who believe that fiat is a scam and that global banking will fail. I don't find anything wrong with their belief, of course, but the predominantly libertarian Bitcoin community of the past has since been diluted by the entry of speculators, enthusiasts, etc., so they're probably in the minority nowadays.

The belief probably seems more popular than it actually is in this forum because post-padders that do nothing but talk up Bitcoin like to parade it a lot on one-line posts. They may actually truly believe it, but most of the time it just sounds like hivemind talk echoing from the past. That's just from my observation though.

[BrewMaster]

i have never been an "extremist", and i believe i am more of a "realist".
unlike you, even during the huge rise that we had last year, i never thought bitcoin is going to "take over"! that has always sounded silly to me and i have always told others who ask "will bitcoin replace fiat or banks" that it will never happen.
and because of that i have never liked branding people either. names such as "nocoiner", "bitcoin minimalist" all sound silly to me.

[lunaelucemauram]

Right now as there is already a community that believes in cryptocurrency then its market will not be easily gone so as what we see in the current stock exchange and no matter how low the prices of each cryptocurrency gets it will just stay as there are people who believes in it and if that happens another innovation or breakthrough will happen in the market that will pump its prices.

[aso118]

If a parallel economy starts developing in Bitcoin, you can be sure that governments will get together to crush it. Governments across the world have been using banks to crackdown on the proceeds of crime and are trying to minimize the use of cash. If a parallel Bitcoin economy develops, you can't be sure that criminals would gravitate towards it too.

[unusualfacts30]

We're already heading towards what some may label as parallel economy but if people aren't spending then it'll get crushed. I have seen many famous people on youtube using bitcoin address to ask for donation/payment. I think this movement is growing and it will only get bigger. I don't see how it can completely replace fiat either but something like parallel economy is where we're heading once mass adoption is done. Most important part is education. I think there are too many bitcoin illiterates that needs to be brought on board.

[kryptqnick]

Why can't there be a future in which bitcoin exists as an alternative to fiat money?

Why does it seem like everybody is so adamantly pushing for one of two extremes? Isn't it more likely that the truth will lay somewhere in the middle?

This can surely happen and, as others said, it is already moving that way. But this is very wrong and we should wish it won't be this way. We currently have fiat and all the governments are trying to keep the track of how much money is circulating out there in comparison with goods that can be bought with this money. But all this money is fiat, of course. Cryptos are forming a huge market which is not taken into consideration by the govs. With time, there are likely to be more shops accepting btc and more safe ways of transferring btc into fiat. Let's imagine a citizen X, who supposedly has about 700 euros per month. The gov thinks about stuff this person can and cannot afford, some social help he/she might be eligible for etc. What the gov doesn't know, is that apart from 700 euros salary, citizen X also earns about 300 euros in bitcoin each month, or has a couple of btc in savings. Anytime, this person can just spend this money, while the amount of goods stays the same and this person is not supposed to be able to buy some stuff he/she actually buys. Now, if that's just one person, this is totally not something to care about. But what if in country Y each third person has this unaccounted income or savings? This can crush the country's economy, cause inflation and crisis.
That's why, even though both cryptos and fiat can stay, they should not exist parallel, but should be both equally acknowledged and considered by the governments. Underground economy is always a risky thing to allow and neglect.

[ttookk]

I've actually observed that the Bitcoin as an alternative to fiat future theory is pretty popular. I think the same way, and when I talk about it there always seem to be people who agree with me.

The only ones who truly believe Bitcoin will replace everything are the hardcore libertarians who believe that fiat is a scam and that global banking will fail. I don't find anything wrong with their belief, of course, but the predominantly libertarian Bitcoin community of the past has since been diluted by the entry of speculators, enthusiasts, etc., so they're probably in the minority nowadays.

The belief probably seems more popular than it actually is in this forum because post-padders that do nothing but talk up Bitcoin like to parade it a lot on one-line posts. They may actually truly believe it, but most of the time it just sounds like hivemind talk echoing from the past. That's just from my observation though.

Maybe this is the effect of observing a loud minority, then you are definitely right. But among people who are actually quite strongly involved in Bitcoin, be it in a technical or in some other way, the thought that eventually Bitcoin will take over as a global base currency seems to be quite popular. But obviouly, this could just be a hen-egg thing. You are unlikely to get much involved in the technicals of something you don't really believe in.

However, we as people who are somewhat involved (and I think actively participating in a forum counts as "involved") should ask ourselves the question: what do we believe the future of Bitcoin will look like? Let's say, twenty years from now. Do you believe, Bitcoin will still be around? And if yes, what will it role be? Are you going to be able to choose it as a payment option when ordering on Amazon? Pay at Starbucks with it? Will it still be only a store of value for nerds?

Now, of course none of us has the answer. So what we are left with is an educated guess, maybe assigned with some level of propability, like XX% chance to become a base currency for the world, XX% chance to become relevant for smaller states with failed local currencies, XX% to stay where it is and so on. I don't have actual numbers.

There is a good chance that some people don't believe in Bitcoins (or any other cryptocurrencies) long term viability and are just playing along with what they perceive as the tulip game: trade t to get mre money and don't be the one holding the bag at the end. I can respect people having this thought process. I am also determining my current stack in my local currency, as do most people. But I am also a believer, at least to some degree. I think Bitcoin, or at the very least blockchain is here to stay. We still have to figure out where it makes sense and where it doesn't, but this is natural for new concepts. Widely available electricity brought a cambian explosion of ideas and inventions that were unthought of before, and I think this is what will stay at the very least. This is too much of a new thing with new possibilities to not keep at least a bit of it around. Will it be Bitcoin? I don't know. But looking at all the use cases which are currently emerging, looking at all the other projects that want to improve upon the original idea in some way, I still think that Bitcoin is the biggest, the most active, and, even if a lot of people don't realize this yet, versatile enough to carry all sorts of ideas.

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Most important part is education. I think there are too many bitcoin illiterates that needs to be brought on board.

I strongly disagree with this. If people need to understand Bitcoin in order to use, Bitcoin won't go anywhere.

A seven year old has no clue what fractional reserve banking is and can buy a candy at the store with his pocket money. Almost no one understands how Visa works or banks keep track of who has how much money, but they can still use the system. Bitcoin is still way too complicated. You can't have a system which is adopted by the masses if you need every participant to understand it, that won't work.

This is the grandma test: would you trust your grandma to use Bitcoin to store her lifesavings? And I don't mean because it is too volatile, I mean keeping her private keys safe, or use some service which does that for her. If the answer is no, we aren't there yet.

[jseverson]

Maybe this is the effect of observing a loud minority, then you are definitely right. But among people who are actually quite strongly involved in Bitcoin, be it in a technical or in some other way, the thought that eventually Bitcoin will take over as a global base currency seems to be quite popular. But obviouly, this could just be a hen-egg thing. You are unlikely to get much involved in the technicals of something you don't really believe in.

I personally think that's just because the earliest (and consequently, most influential) enthusiasts were predominantly libertarian. He did release the original white paper in a cryptography mailing list which is why the first members of the community were cypherpunks and, I'm guessing, were somewhat inclined towards libertarianism. I do find your observation to be true though.

However, we as people who are somewhat involved (and I think actively participating in a forum counts as "involved") should ask ourselves the question: what do we believe the future of Bitcoin will look like? Let's say, twenty years from now. Do you believe, Bitcoin will still be around? And if yes, what will it role be? Are you going to be able to choose it as a payment option when ordering on Amazon? Pay at Starbucks with it? Will it still be only a store of value for nerds?

Well I think Bitcoin will at least continue to build on its existing niches as money of the internet and as a tool for cross-border payments. It's been proven that it can be used in lieu of a credit card or Paypal, after all, and it's apparently very useful for global remittances. I'm not sure if it will ever be suited for point of sale transactions (and neither do I think that it needs to be, considering the rise of e-commerce), but the maturity of the Lightning Network may make that possible. It's also been playing a minor role as a reserve currency for domestic unrest, something it can do much better in the future once the market gets large and stable enough. I'd probably be happy enough with just that.

Barring the rise of an out of left field, revolutionary breakthrough in technology that can render it obsolete in every major way, I believe Bitcoin is the future of cryptocurrencies.

[1Referee]

If a parallel economy starts developing in Bitcoin, you can be sure that governments will get together to crush it. Governments across the world have been using banks to crackdown on the proceeds of crime and are trying to minimize the use of cash. If a parallel Bitcoin economy develops, you can't be sure that criminals would gravitate towards it too.

You know what the most efficient way is for governments to eliminate Bitcoin? It's by simply offering a fair and honest banking/governmental system.

Trying to crack down on Bitcoin by force only leads to local decentralized economies emerging, which is something that's way worse in every form or shape. China's local crypto economy is currently larger than its 2016 legal economy, which says enough. Instead of trying to combat/eliminate Bitcoin, they only made their 'enemy' grow larger. It's more of a problem than ever before and it's completely their fault.

Bitcoin isn't just Bitcoin, but it's a message and an escape. If governments start to make life difficult for you, which they do, people will realize that Bitcoin is actually an escape and not just a speculative shit tool. In a way we have to thank governments for being the pricks they always have been.

[davis196]

We already have  parallel bitcoin economy.We have online services,such as Openbazaar and purse.io.
We have a bunch of online casinos and crypto dice games.We have all the crypto exchange trading platforms.
It just isn't enough.The crypto economy is just too small and the level of expansion is close to zero.
I agree that we couldn't always bother about the bitcoin price,but the bitcoin economy just isn't growing,if the bitcoin price isn't going up.

[timerland]

Why can't there be a future in which bitcoin exists as an alternative to fiat money?

This is probably the most sensible prediction that I can think of.

It's unlikely that bitcoin or other cryptocurrencies will ever be able to completely replace fiat currencies. As long as there are governments still in place, there will be central banks issuing fiat currencies, which a significant proportion of the population is probably going to use.

Mass adoption doesn't necessarily mean that bitcoin needs to replace fiat altogether. It just means that the number of adopters significantly increase to a point where you are able to transact with bitcoin just as you would with fiat in day to day transactions. So yeah, a parallel bitcoin economy is definitely feasible, is happening now, and probably will expand into the future.

[Grayy]

Yes, you got a point. People tend to see Bitcoin as the one who will replace fiat or it will be a global currency that will replace dollars, I beg to differ. It's either Bitcoin will die or it will be use as a currency for a certain thing. It won't replace fiat but it will be use in something that is convenient.

Bitcoin being used  for the sake of convenience is the very reason why bitcoin will not die. Who wants to join a queue or get to a bank to know discover that he's been deducted some money he doesn't understand? Everyone wants convenience in one way or the other and that is why  BTC is gonna be one of the major currencies of the works for this generation.

[magneto]

Hey, so I've been thinking, with all this talk about mass adoption flying around and nocoiners calling bitcoiners a cult, maybe the truth is somewhere in the middle. There is definitely something religious about believing that Bitcoin will be the world currency at some point, but I also don't think that it will die off if the majority decides not to bother with it.

Thinking back to the first time I got in contact with Bitcoin, I didn't really think of it as being the "future of money". I kinda drank the kool-aid with the last massive pump. Not that I thought that would be the beginning of Bitcoin taking over, but maybe as a foreshadow of what was to come.

We tend to see things black and white and this is no exception. I have the feeling that even amongst bitcoin maximalists, there is a sentiment of "the whole world or nothing at all", that either at some point, Bitcoin will be the one money to rule them all or it will wither and die eventually. Being who they are in their somewhat religious state, they obviously didn't really bother too much with option two.

But these two paths, boom or bust, are not the only ones available, aren't they. We already have a Bitcoin economy, although I would argue that it is disproportionately small in comparison to Bitcoins current marketcap. Why not just expand on it? Why can't there be a future in which bitcoin exists as an alternative to fiat money?

Why does it seem like everybody is so adamantly pushing for one of two extremes? Isn't it more likely that the truth will lay somewhere in the middle?

Who said it can't happen?

The people saying that bitcoin will go to the moon, or it will die (i.e. only two possibilities are available) are clearly misinformed. There are many roles that bitcoin can play in parallel with the fiat system, that involve mass adoption, without necessarily having to take over or replace fiat currencies.

In fact, that's the most likely scenario in the future, with bitcoin being used worldwide in parallel with other fiat currencies. It could serve a particular niche market, like those who want to facilitate international transactions, or store their wealth; or it could be used as an alternative currency for online purchases. Who knows. But there are much more than just boom/bust. What you are suggesting is completely possible and even probable.

[bitbunnny]

i have never been an "extremist", and i believe i am more of a "realist".
unlike you, even during the huge rise that we had last year, i never thought bitcoin is going to "take over"! that has always sounded silly to me and i have always told others who ask "will bitcoin replace fiat or banks" that it will never happen.
and because of that i have never liked branding people either. names such as "nocoiner", "bitcoin minimalist" all sound silly to me.

I fully agree with you. Bitcoin will never replace fiat currencies, banks and become a mainstream in economy. I don't even believe that this is the purpose of Bitcoin.
If you have in mind that Bitcoin relies on specific technology, the number of coins is limited and how actualy just a handfull of people in the world is using Bitcoin, you will realise this is not possible.
So, be realistic and use and support Bitcoin in the framework it can function, don't have ideas that are utopia.

[Aikidoka]

Yes, you got a point. People tend to see Bitcoin as the one who will replace fiat or it will be a global currency that will replace dollars, I beg to differ. It's either Bitcoin will die or it will be use as a currency for a certain thing. It won't replace fiat but it will be use in something that is convenient.

I think that process cannot be done because the government fear bitcoin. If the bitcoin system is implemented, people will resort to it and stop relying on banks. However, the government also should regulate the use of bitcoin, and taxes should be implemented. But still not a good idea to look after two things; fiat currency and digital currency. The government already has obstacles concerning fiat currency. So, what do you expect when digital currency happens to appear beside the fiat currency?

[Nyak put]

That is the bad newa .but i agree with you

[aoihs00]

I've actually observed that the Bitcoin as an alternative to fiat future theory is pretty popular. I think the same way, and when I talk about it there always seem to be people who agree with me.

The only ones who truly believe Bitcoin will replace everything are the hardcore libertarians who believe that fiat is a scam and that global banking will fail. I don't find anything wrong with their belief, of course, but the predominantly libertarian Bitcoin community of the past has since been diluted by the entry of speculators, enthusiasts, etc., so they're probably in the minority nowadays.

The belief probably seems more popular than it actually is in this forum because post-padders that do nothing but talk up Bitcoin like to parade it a lot on one-line posts. They may actually truly believe it, but most of the time it just sounds like hivemind talk echoing from the past. That's just from my observation though.

May be not. Bitcoin might just be choice but not the parallel economy at all. Currently we can see that how hard it is trying to have its economic sphere to be made in the name of financial system but how many times it has succeeded anyways ? I guess none of the time. Because every time either there had been government against it or may its been rough ban on it because of financial regulatory bodies within the country. The bitcoin is small environment where the use is very much private or personal one and thus the system of peer to peer transaction is just being normal transaction phase rather than whole parallel economy.

[magneto]

I've actually observed that the Bitcoin as an alternative to fiat future theory is pretty popular. I think the same way, and when I talk about it there always seem to be people who agree with me.

The only ones who truly believe Bitcoin will replace everything are the hardcore libertarians who believe that fiat is a scam and that global banking will fail. I don't find anything wrong with their belief, of course, but the predominantly libertarian Bitcoin community of the past has since been diluted by the entry of speculators, enthusiasts, etc., so they're probably in the minority nowadays.

The belief probably seems more popular than it actually is in this forum because post-padders that do nothing but talk up Bitcoin like to parade it a lot on one-line posts. They may actually truly believe it, but most of the time it just sounds like hivemind talk echoing from the past. That's just from my observation though.

It definitely could.

Fiat is definitely not the best store of value there is, and there are many flaws to it. And I completely respect their point of view as well because hey, at least they are not blindly falling into the fiat scheme that the government has set up, which isn't necessarily a bad thing in the short term, but in the long run will always depreciate and takes away from your wealth bit by bit through depreciation.

Even though that's the case, the most realistic scenario is that a government will continue to rule over each country in the future, which means that they are most likely going to continue to issue fiat. Whether you like it or not, fiat is here to stay probably. In which case, bitcoin will realistically only serve as an alternative, but will still be a huge role since you can always hold it to hedge against fiat.