Currency is a medium of exchange used to conduct commerce.
Currency is most commonly issued by government or some trusted non-government source. Currency could actually be a commodity that is so commonly known and valued that it is accepted as the medium for commerce.
Governments generally declare a monopoly on the issuing of currency in their borders. This is reasonable. In a day of using physical gold, silver, whatever ... a risk was run of someone making coins that were not the purity/% content and the issuer of such devalued coin would be giving themselves purchasing value they did not have by defrauding others. This would frequently result in harsh consequences up to the death penalty.
When a government devalues its own currency, or people have no confidence in the long term viability of the government, they will find something else to use as currency. Governments try to stop this, usually for tax purposes.
The fact that government issued currencies (and the governments issuing them) are viewed as not reliable and not stable does not make crypto reliable and stable. It just means that people are looking for something that might be stable. Growth in crypto is not a function of crypto being reliable, it is the fact that the government has become so unreliable that people would think that crypto would be a viable option. Tired of living with the abuser, the spouse hopes to find better luck with the con who up to this point has not provided evidence they are lying.
Most of the planet has as much reason to trust the issuers of crypto-currency as they do to trust the federal reserve. I have as much means of redress of grievances from being ripped off by the fed as I would from being ripped off by a crypto-currency issuer/originator. The drive is a loss of confidence in government.
The cyrpto-currency issuer:
1. can increase the amount of currency any time they want. You can't stop that and neither can I.
2. can lie about the total amount of currency in existence any time they want. You can't know the truth, you are putting implicit confidence in them.
3. backs the currency with nothing. The fact that the US government issues fiat currency does not make crypto valuable, it just means that it is a digital fiat with no government backing it.
4. can get their crypto-currency labelled a commodity or security by a government and treated as such. There is nothing the crypto-currency issuer or you can do about that but get taxed.
Many people who were 'early' adopters of crypto are quick to promote it because from there standpoint it is a potential measure of wealth that has increased for them (in potential terms) since they put government currency into the crypto.
The potential is only made into reality when the crypto is converted into tangible goods and property.
I know people who talk about how much their crypto has increased in value for them (in potential terms). Good for them. Its like someone telling me that they bought Apple at $10 a share. I have no incentive to get involved because I don't have any reasonable basis for making money there if I were entering now. The argument that 'crypto will just go higher so you should get in now' has echoes of ponzi schemes and multi-level marketing.
I accept crypto-currency is intended by some to be a good faith solution to lack of confidence in governments. However, where you find an honest inventor with a good idea, you quickly find a bunch of hucksters who see a way to take real wealth from others. For them, crypto is a way to take something of worth (real world government accepted currency units, securities, physical possessions) from suckers in exchange for the promise of crypto-currencies future.
Government issued currency backed by tangible resources (gold, silver, whatever) which the currency can actually be exchanged for is a winner.
Crypto based upon the above government issued currency is a winner.
Physical currency of commonly accepted value, though not issued by a government is a winner.
Crypto based upon someone's supposedly secure blockchain technology alone, with nothing to back it, and not yet exposed to a future generation of technologies ability to compromise existing security systems is a fantasy island of value. Crypto issued by some party that can devalue that currency any time without any means of redress by those who 'own' the currency is a scam.
Crypto issued by a party that goes out of existence is a scam.
a risk was run of someone making coins that were not the purity/% content and the issuer of such devalued coin would be giving themselves purchasing value they did not have by defrauding others.
There is another risk that is even worse, at least historically. That is the hording of currency. Anyone can come in, and with enough resources horde a currency and destroy a nation. This was (at least according to history) the reason for the fall of (western) Rome.
There are many other examples of extreme fuckery in this vein as well though, including the impetus for the Coin act of 1873 which took silver off the dollar, and the hording of gold that led to the Great Depression (really it was the transferring of gold to Europe, but its the same effect). That led eventually to the EO that confiscated all the Gold in America under the tyranny of Eminent Domain (to our sovereign overlords), which final act of hording led to where we are today.
Governments generally declare a monopoly on the issuing of currency in their borders. This is reasonable.
Because of the above risk of hording, I suggest this is terrible, and will always lead to failure because of that intrinsic flaw. I suggest the only viable path to maintain a free market is one that has a market for, and encourages barter, with many possible exchange mediums, not set in value, but all as valuable as they naturally are.
I mean, you could set one as the standard (like silver), but it's only a placeholder number. As long as the act of setting a baseline doesn't give that medium any extra value itself just because it is set as a baseline, then hording becomes impossible (or at least highly improbable).
That is why I have suggested, and keep suggesting that the best path forward is one where all assets that can be reasonably put on blockchain, be put on blockchain (all stocks for instance. All PMs, etc.). This way the market is always open and free.
Currency is a medium of exchange used to conduct commerce.
Currency is most commonly issued by government or some trusted non-government source. Currency could actually be a commodity that is so commonly known and valued that it is accepted as the medium for commerce.
Governments generally declare a monopoly on the issuing of currency in their borders. This is reasonable. In a day of using physical gold, silver, whatever ... a risk was run of someone making coins that were not the purity/% content and the issuer of such devalued coin would be giving themselves purchasing value they did not have by defrauding others. This would frequently result in harsh consequences up to the death penalty.
When a government devalues its own currency, or people have no confidence in the long term viability of the government, they will find something else to use as currency. Governments try to stop this, usually for tax purposes.
The fact that government issued currencies (and the governments issuing them) are viewed as not reliable and not stable does not make crypto reliable and stable. It just means that people are looking for something that might be stable. Growth in crypto is not a function of crypto being reliable, it is the fact that the government has become so unreliable that people would think that crypto would be a viable option. Tired of living with the abuser, the spouse hopes to find better luck with the con who up to this point has not provided evidence they are lying.
Most of the planet has as much reason to trust the issuers of crypto-currency as they do to trust the federal reserve. I have as much means of redress of grievances from being ripped off by the fed as I would from being ripped off by a crypto-currency issuer/originator. The drive is a loss of confidence in government.
The cyrpto-currency issuer: 1. can increase the amount of currency any time they want. You can't stop that and neither can I. 2. can lie about the total amount of currency in existence any time they want. You can't know the truth, you are putting implicit confidence in them. 3. backs the currency with nothing. The fact that the US government issues fiat currency does not make crypto valuable, it just means that it is a digital fiat with no government backing it. 4. can get their crypto-currency labelled a commodity or security by a government and treated as such. There is nothing the crypto-currency issuer or you can do about that but get taxed.
Many people who were 'early' adopters of crypto are quick to promote it because from there standpoint it is a potential measure of wealth that has increased for them (in potential terms) since they put government currency into the crypto.
The potential is only made into reality when the crypto is converted into tangible goods and property.
I know people who talk about how much their crypto has increased in value for them (in potential terms). Good for them. Its like someone telling me that they bought Apple at $10 a share. I have no incentive to get involved because I don't have any reasonable basis for making money there if I were entering now. The argument that 'crypto will just go higher so you should get in now' has echoes of ponzi schemes and multi-level marketing.
I accept crypto-currency is intended by some to be a good faith solution to lack of confidence in governments. However, where you find an honest inventor with a good idea, you quickly find a bunch of hucksters who see a way to take real wealth from others. For them, crypto is a way to take something of worth (real world government accepted currency units, securities, physical possessions) from suckers in exchange for the promise of crypto-currencies future.
Government issued currency backed by tangible resources (gold, silver, whatever) which the currency can actually be exchanged for is a winner. Crypto based upon the above government issued currency is a winner. Physical currency of commonly accepted value, though not issued by a government is a winner.
Crypto based upon someone's supposedly secure blockchain technology alone, with nothing to back it, and not yet exposed to a future generation of technologies ability to compromise existing security systems is a fantasy island of value. Crypto issued by some party that can devalue that currency any time without any means of redress by those who 'own' the currency is a scam. Crypto issued by a party that goes out of existence is a scam.
There is another risk that is even worse, at least historically. That is the hording of currency. Anyone can come in, and with enough resources horde a currency and destroy a nation. This was (at least according to history) the reason for the fall of (western) Rome.
There are many other examples of extreme fuckery in this vein as well though, including the impetus for the Coin act of 1873 which took silver off the dollar, and the hording of gold that led to the Great Depression (really it was the transferring of gold to Europe, but its the same effect). That led eventually to the EO that confiscated all the Gold in America under the tyranny of Eminent Domain (to our sovereign overlords), which final act of hording led to where we are today.
Because of the above risk of hording, I suggest this is terrible, and will always lead to failure because of that intrinsic flaw. I suggest the only viable path to maintain a free market is one that has a market for, and encourages barter, with many possible exchange mediums, not set in value, but all as valuable as they naturally are.
I mean, you could set one as the standard (like silver), but it's only a placeholder number. As long as the act of setting a baseline doesn't give that medium any extra value itself just because it is set as a baseline, then hording becomes impossible (or at least highly improbable).
That is why I have suggested, and keep suggesting that the best path forward is one where all assets that can be reasonably put on blockchain, be put on blockchain (all stocks for instance. All PMs, etc.). This way the market is always open and free.