What if someone found a way to uniquely identify matchsticks. Could you imagine gambling with matchsticks that were identifiable to certain people in such a way that they could not be double spent, and that their identity could not be stolen? Poker for matchsticks.
Government controlled gambling is supposed to be about keeping people from hurting each other and themselves. And it IS about that, a tiny bit. But mostly it is about making sure that big business isn't hurt by people encroaching on big business's profits. Government has become the pivot point of big business, allowing enough freedom to people so that they are happily productive, yet keeping them in bondage enough so that they are profitable for big business as much as possible.
Who am I hurting if I gamble? Myself? Isn't that MY business as long as I am not hurting anyone else? If I cause big business to be less profitable by my freedom, am I hurting them? Or are they hurting me by not letting me be free, just so that they can profit a little more?
Some lady in India has a political beef with some local government over there. So, in 2000 she went on a hunger strike, a total fast. They have a law, that attempted suicide is punishable by one year in prison. When it became apparent that she was going to starve herself to death, they called that attempted suicide, threw her in jail for a year, and force fed her through a tube in her nose. After the year was up, they freed her, and she picked up where she left off with her hunger strike. And the cycle continues until today.
The point is, Bitcoin is going to allow freedom in such a way that big business will be destroyed. It may not happen fast. It might not be easy. But the banking system on which big business rides is just about destroying itself already.
Of course, it won't be Bitcoin entirely. Counterparty is active. Mastercoin (not the coin) is coming online. MaidSafe is activating. There are many free Internet protocols like Tor and I2P that are eating into big business right now. As people innovate using all of these and others, soon they will figure out ways to bypass governments and big business, become behind-the-scenes freedom governments, and freedom will abound for a while.
Then, people using Bitcoin-style freedom will attempt to enslave other people, and the cycle will start all over again. Who knows what havoc or freedom the quantum computer will reek when it comes online?
No, it's not going to result in this.
First, controlled economies are the result of people asking for them, not the other way around. Read up on the economic history from the 1800s. Currency swings utterly devastated businesses (especially farmers). People want a stable currency where something that costs $100 today isn't going to cost $20 or $500 a year from now. Central banks ensure that this happens.
Second, large businesses are the result of economies of scale advantages. BitCoin isn't going to suddenly allow a Mom and Pop shop to compete against WalMart, Ford, ExxonMobil, etc. There's just too many advantages that large corporations have to offer to imagine that they'll collapse.
Third, you can't simultaneously ask the government to but out, then say that things need to be done to prevent another Mt.Gox. You may not have been saying both, but plenty of people get upset when they get ripped off, and wouldn't want a lawless world.
Fourth, the banking system will not die. People need loans. Students need loans. Businesses need loans. Cities, states, and countries need loans. And you're a fool if you think people would rather keep money/BTC in a private wallet that provides no return over a bank that would offer them a return on their deposit.
