What do you say to that? Ouch. Does this prove that the naysayers calling it a Ponzi Scheme were right? Do they get the last laugh, or is that just an expected evolutionary process of disturbance as all the kinks are worked out? Well, consider this thought experiment I had.
Let’s say there was hanky-panky involved, let us say somebody hacked the system or stole the electronic money. At this time, digital money flies beneath the radar since it isn’t recognized even with all the new Too Big To Fail regulations on banks, etc.. How can a digital money have worth? Difficult to say, how can a fancily printed piece of paper marked $20 be worth anything, it is not, but it is worth what it represents if most of us agree to this and have confidence in the currency. What is the difference, it is a matter of confidence right?
Okay so, let us say that the regulators, FBI, or another branch of government complies and documents charges – should they record criminal charges that somebody defrauded somebody else then how much defrauding was involved? If the government enforcement and justice department place a dollar sum number to this, they are inadvertently agreeing that the electronic money is real, and it’s a value, consequently, acknowledging it. When they don’t get involved, then some fraud which might or might not have happened sets the whole concept back a ways, and the media will continue to push down the confidence of all electronic or crypto-currencies.
So, it’s a catch-22 for your government, regulators, and enforcement people, and they cannot look another way or deny that this trend no more. Is it time for regulations. Well, I personally despise regulation, but is not this how it usually starts. Once it is regulated credibility is given to the notion, but his electronic money theory could also undermine the whole One World Currency strategy or even the US Dollar (Petro-Dollar) paradigm, also there might be hell to pay for this as well. Can the global economy manage that degree of disruption? Stay tuned, I guess we shall see.
In the meantime, what happens next will either make or break this new shift in how we see monetary value, wealth, online transactions and the way the actual world will mind-meld into our prospective blurred reality. I just don’t see many people believing here, but everybody needs to, one misstep and we could all be in a world of hurt – all of humankind that is. Please think about all of this and consider it. Powerful stuff, we think – what are your impressions? There is a great deal within the body of information surrounding crypto genius software. Yes, it is true that so many find this and other similar subjects to be of fantastic value. A lot of things can have an impact, and you should expand your scope of knowledge. It is always a good idea to determine what your situations call for, and then go from that point. You will find out the rest of this article adds to the foundation you have built up to this stage.
Bitcoin is further away from being The numeraire; not just can it be simply a number, much as Fiat… but its value is quantified in Fiat! Even if Bitcoin becomes internationally accepted as a medium of exchange, and even though it succeeds to replace the Dollar as the approved ‘numeraire’, it can not possess an intrinsic measure like Gold has. Gold is unique in being quantified by a real, unchanging physical quantity. Gold is exceptional in preserving value for thousands of years. Nothing else in reach of humankind has this unique combination of qualities.
In conclusion, while Bitcoin has A few advantages over Fiat, namely anonymity and decentralization, it fails in its claim to being cash. Its advantages are also questionable; the intent is to restrict the ‘mining’ of Bitcoins to 26,000,000 units; this is the ‘mining’ algorithm makes harder and harder to solve, then hopeless after the 26 million Bitcoins are mined. Unfortunately, this announcement could very well be the death knell of Bitcoin; currently, some central banks have announced that Bitcoins may become a ‘reservable’ currency.
Wow, sounds like a Significant step for Bitcoin, does it not? After all, the ‘large banks’ seem to be accepting the legitimate value of this Bitcoin, no? What this actually means is banks realize that they could exchange Fiat to get Bitcoins… and to really buy up the 26 million Bitcoins planned would cost a meagre 26 Billion Fiat Dollars. Twenty six billion Dollars isn’t even small change to the Fiat printers; it’s about a week’s worth of printing by the US Fed alone. And, once the Bitcoins purchased and locked up at the Fed’s ‘wallet’… what useful purpose would they serve?
There would be no Bitcoins left in Flow; an ideal corner. If there are no Bitcoins in flow, how on Earth can they be used as a medium of trade? And, what would the issuers of Bitcoin potentially do to defend against such a destiny? Change the algorithm and boost the 26 million to… 52 million? To 104 million? Combine the Fiat printing parade? But , by the quantity theory of money, Bitcoin would begin to eliminate value, as Fiat allegedly loses value through ‘over-printing’…
We come to the key issue; why hunt To get a ‘new money’ if we have the best cash, Gold? Fear of Gold confiscation? Deficiency of anonymity in the intrusive government? Brutal taxation? Fiat money legal tender laws? All of the above. The answer isn’t in a new form of cash, but in a new social structure, one without Fiat, without Government spying, without drones and swat teams… with no IRS, border guards, TSA thugs… on and on. A world of independence not tyranny. Once this is achieved, Gold will restart its ancient and critical role as honest money… and not a moment before.
Rudy J. Fritsch was born in Hungary In 1947, also fled Socialist tyranny during the Hungarian Revolution of 1956. His family had lived through WWII and the consequent Hungarian hyperinflation, thus he has intimate experience with financial destruction.
As an engineer and engineer, he Conducted a successful family business in Canada for decades, at its peak employing over 100 workers, until economical upheaval ruined the profitability of North American manufacturing. Driven from business, he chose to study economics… to discover the cause of this unhappy circumstance.
The halving occurs when the Amount of ‘Bitcoins’ awarded to miners after their successful creation of this new block is cut in half. Therefore, this phenomenon will cut the given ‘Bitcoins’ out of 25 coins to 12.5. It’s not a new thing, however it does have a lasting impact and it is not yet known whether it’s good or bad to ‘Bitcoin’.