i came across bitcoin yesterday. i read the wikipedia article, the bitcoin faq and whatever else popped up on
google. i was immediatly stoked. i like this idea, and think the bitcoin has a future. reading forum posts about
thoughts on this new concept all pull up the same idea "it wont work because there is nothing backing it". i thought
long and hard about this, and i think i have it figured out.
first, an insight on currency in general. buying with currency, is glorified bartering. we used to like someones
cow, and trade two of our goats for it. to each of us, this was fair, and we each walked away with our new animals.
then the government stepped in and decided they deserved a cut of all transactions "to help pay for improvements to
the area they governed" to bring more people to their area, and make more money. they decided to use precious metals
as a base. it was in limited supply and caled valuable(maybe because it was shiny).
trading stuff for gold was the new "bartering". but people wouldnt wanna carry around a large amount of rock, so a
paper symbol was created to carry around called the dollar bill.
so now, we dont trade our two goats for that cow, we trade a symbol of the gold that the cow is worth. its bartering
with a tax
many people coorelate gold as the base of our currency, but thats very wrong. gold is only the base of the "value"
of the currency. the more money that gets printed, the more all money loses value.
bitcoin is not the currency. bitcoin is the gold. its currency is all currency. this could take us back to the roots
of bartering. you can trade anything for bits. services, goods, any national currency, or anything else that could
be bought or sold with any bartering catalyst.
but whats keeping the bits in check? itself. they are slowly releasing bitcoins until 2017, at which time, there
will be 21 million bits in existance. thats the cap. no more will be inserted into the bitcoin economy. from then
on, the only fluxuation will be supply and demand. no inflation, no deficit, and no tampering. gold and bits will have the same limits of finite numbers
depending on the public acceptance, a cheeseburger could cost 10 bits or 1000 bits. my dream is for the
bitcoin to be in high enough demand to be the "credits" we see in sci fi movies. unregulated, and international.
ribuck from freedom radio said so much with one sentence:
In a free world, we need to learn how to evaluate the value of something to us, and learn to stop expecting others
to assign (and guarantee) a value to it.
bitcoins has a lot of potential, the way it reaches its potential is to prove to daily vendors that bitcoins will always have a value.