1. If you trade in bitcoins you still have to find a buyer of them if you want a pizza. Thus you will have to use a service to exchange your money to dollars on their terms. If you drive to a bitcoin meet-up you are still wasting gas to do the exchange. You will have a middleman more often.
As BitterTea mentioned, this is just a problem for the early adopters. The problem goes away the more vendors start accepting bitcoins directly. I don't think the bitcoin system was ever meant to operate with a middleman forever!
2. There is a risk of lost, stolen, or disk failure wallets. Yes you can lose your wallet in real life, but you usually find it under the bed.
Encryption, backing up, etc. Put a copy on a flash drive, then you can find it under your bed right next to your leather one. There's also the option of using a bank, which I'm sure will become a much more attractive option the more time our current banks have to mature and new banks have to pop up. Heck, I've already begun the testing stages of a community bank of my own that bests MyBitcoin and Instant Wallet in certain regards (though, admittedly not others.)
3. Shops are slow in adjusting prices, if the price rises and their store might have prices that are 2 months old and they seem expensive. What if prices crash 90% will the shop honor the price? I doubt it they buy all their materials in USD, CAD, RUB, or EUD.
Yeah. We sure could use a service that automatically adjusts a person's prices for them based on the Mt. Gox exchange rate. (I'm pretty sure MyBitcoin's shopping cart interface does exactly that.)
I feel like this would be more of a problem for places like Bidding Pond. On the other hand, Bidding Pond could act as a price stabilizer of sorts if it gets big enough. After all, if prices keep fluctuating too much either the fluctuation will have to go or those lengthy auctions will.
4. There is no record of exchange. What if you buy a car and you go to pick it up and there is no car or address? You are out 10,000 BTC. If you buy something over the internet even for 1 BTC, if they don't send it you are out of luck.
BitterTea covered this one pretty well.
5. The churning of your hard-drive is already annoying to run the bitcoin client. If the economy gets 10x bigger that churning is going to be 10x bigger. Are there any stats to Mb per day you waste on hard disk space? What about bandwidth?
Ultra-lightweight and light-weight clients. Also, banks. Your hard drive does absolutely no churning when there's a bank churning for you!
6. In the end you might have to end up using a bitcoin bank anyways where you store your bitcoins to take the risk out of lost wallets. Then you run the risk that the goldsmiths, take your money and spend it loans and blow.
Okay, what BitterTea said, plus: I'm starting a community run bank! It's called Bitcoin Pouch! Right now it's only running on testnet so people can play around with it using fake bitcoins and not have to worry about losing them, but once it's in production I intend to run it under a system of communal governance and accountability. Haven't decided on a model yet. Thinking about having audits every once in a while to prove all the bitcoins are still there. Maybe an annual Run on the Bank event, where everyone withdraws their bitcoins all at once? Seriously, if you insist on complete openness, there's no reason banksters ever need arise again. They'll try, but hey: vigilance and freedom are positively correlated.
7. There is always the risk of someone destroying the network or finding a flaw and taking the system down. Since BTC could be used for money laundering, it might be a big goal of the governments of the world to take it down.
Yup. That might hurt the price. Then again it might help it. No telling what actions might be taken and what effect those actions might have. But one thing I do know: taking down the Bitcoin Network (the Bitnet?) will be about as hard as taking down the Internet or, if we're feeling a little less grandiose, BitTorrent.
8. What if people stopped mining BTC, or the euphoria of a deflationary currency would people lose interest in it?
Yeah. If everyone in the Bitcoin Community were to give the currency a vote of no confidence and walk away for good, THAT would kill bitcoins dead. Okay, do you know what that means? We have created the first truly free and democratic system of currency
ever. So... if you were to tell me you think every person in the community is capable of simply walking away from this, well, I'd kinda look at you funny and say I disagreed. Because really, it wouldn't just take the miners giving up. If the miners give up, then the difficulty plunges and we're back to where CPU mining is profitable. The folks who still believe in it will keep that going as best they can.
Everyone would have to leave. Or perhaps everyone but two, since a currency needs three people using it to be useful.
This is
not a very likely scenario. But hey, maybe that's just me and BitterTea.
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