Protectionism in Bitcoinistan

[no to the gold cult]

Making it difficult to purchase bitcoins with fiat via Paypal etc actually helps the bitcoin economy in a similar manner to protectionist policies and tariffs to promote domestic industries in developing nations. If people find it harder to just buy bitcoins via exchanges via PayPal, then they are more likely to offer products and services for bitcoin directly.

That's not to say that people won't be able to buy bitcoins in other ways, just that making it less straight forward involving delays by money-transfers or exchanging into this before exchanging into that (LR for instance) will develop Bitcoinistans domestic producers.

The more Bitcoinistan produces the more it will export to it's main trading partner, the United States of Fiatland. Right now most economic activity in Bitcoinistan revolves around producing narcotics that are illegal in the USF, providing casinos (as gambling is not illegal in Bitcoinistan) and real estate for the huge manufacturing and service enterprises planned to be constructed in Bitcoinistans wide and fertile wilderness. Immigrants are flooding to these verdant fields of Bitcoinistan seeking their fortune, so there's a growing workforce too.

Bitcoinistan will still need to import materials and energy though for manufacturing, but so long as the BOP remains positive...

This is where my vaguely worked-out theory of Bitcoinistan mumbles into silence.

Any thoughts?

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[MemoryDealers]

Protectionist policies only help domestic industries at the expense of every single other person in the country.

I think your analogy to bitcoins is flawed though. 
If a government institutes protectionist policies for a particular industry, automobiles for example,   people are likely to continue to want to drive cars.

With bitcoin, people can simply choose not to use them if the barriers to entry are too high.  (paypal blocking payments,  governments banning them)
If people chose not to use bitcoin the value will drop to Zero, but they will still want to drive cars paid for with dollars.

[speeder]

Protectionist policies only help domestic industries at the expense of every single other person in the country.

I think your analogy to bitcoins is flawed though. 
If a government institutes protectionist policies for a particular industry, automobiles for example,   people are likely to continue to want to drive cars.

With bitcoin, people can simply choose not to use them if the barriers to entry are too high.  (paypal blocking payments,  governments banning them)
If people chose not to use bitcoin the value will drop to Zero, but they will still want to drive cars paid for with dollars.

Exactly.

I only use bitcoin, because someone (ie: people at BCM) still accept PayPal.