
Bitcoin Can Only Win (mass adoption) by Losing (its heart) - aaron-lebo
http://aaron-lebo.github.io/2014/08/29/bitcoin-can-only-win-by-losing/
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wyager
>Future three [the use of Bitcoin exclusively in black markets] is by almost
any measure a complete failure.

I completely disagree. This is _exactly_ what the people who laid the
technological foundations for Bitcoin (Hal Finney, Wei Dai, David Chaum,
etc.), and the Cypherpunks in general were trying to accomplish.

Talk to any of the (many) agorist types endorsing Bitcoin today and I'm sure
they would tell you that they would still be very happy for Bitcoin if it was
relegated exclusive to black markets, because it means that internet black
markets can still work even with only oppressively regulated fiat monetary
systems!

Relegation to black markets might only be a failure if you judge Bitcoin by
its market cap, and not what it accomplishes.

And of course, depending on who you ask, we might expect black markets to grow
substantially in the next few years.

To most of the cypherpunks, Bitcoin's mainstream success thus far is just
icing on the cake.

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jfoster
Most of this seems quite balanced and objective. It's a good post. That said,
I think it still massively underestimates the challenge of getting consumers
to want to use bitcoin. I think that is the biggest problem bitcoin faces.
This suggests that obtaining and storing bitcoins are barriers, but I think
those would be trivially solved if only consumers had a major desire to pay
for stuff with bitcoin.

Bitcoin can't go mainstream unless it has a system of incentives that appeal
to consumers who don't care about the ideology of it. Who will create that
system of incentives? I confess little knowledge of the protocol, but I think
it is most likely to emerge from a PayPal-like payments company, and funded
through transaction fees. The problem is that when a single company is
providing those incentives and taking transaction fees, it looks quite similar
to credit card companies (so then what was the point of bitcoin?), which is
the direction I initially thought the article was heading in.

~~~
natrius
The incentive to use Bitcoin is near-zero transaction fees. Merchants can and
do share those savings with customers.

Any future where Bitcoin fails will still have near-zero transaction fees
because the technology exists to enable that today. Describing such a future
without describing what has outcompeted Bitcoin seems incomplete.

~~~
jfoster
Consumers expect chargebacks to be an option, and if their bank account gets
compromised, for the bank to reimburse. That stuff is possible (AFAIK) on top
of bitcoin, but it needs to be funded somehow. I think that if bitcoin goes
mainstream, the fees may end up looking similar to existing payment solutions.

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ombete
It is refreshing to see people having some skepticism about bitcoin and
cryptocurrency. I suspect that all us have a very limited perspective on what
the potential and future of bitcoin and Crypto is. I think we can all agree
that cryptocurrecy is a disruptive technology.

Just like the Internet cryptocurrency will bring great weatlth and
inovations(google, wikipidea, VOIP, Skype, facebook, etc) and great
failures(Internet bubble,lost of privacy, etc).

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hitchhiker999
With all respect to our American cousins -> Bitcoin != A US financial system.
Regrettably yet another article from an American perspective, by an American
author, that doesn't take into account the actual context.

...balanced and well written, but forgets the rest-of-the-world exists.
America is certainly powerful and influential - but this system goes well
beyond her borders.

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eglover
Everyone doesn't have to use money in the same way for it to be useful. That's
the entire point of money to begin with. It is these kind of shallow political
articles that drives it down. Not those who are currently trading.

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numerik
The arguments seem to only consider Bitcoin in the US, yet it's clearly
global.

~~~
aaron-lebo
I mean that as no slight. I'm an American and I best understand the American
political scene; anything about any other countries would have been ill-
informed at best.

But...I will say that because of the dominance of the United States (SV in
particular) in the tech scene (and the US's financial clout), I find it likely
that any mass adoption would come from an American startup, and ultimately
true "mass adoption" would have to include America and would therefore end up
with these same problems.

~~~
numerik
I think your arguments make sense when focusing on the US, but I don't
necessarily agree that "mass adoption" would have to include the US. If
bitcoin were made illegal (or impotent by regulations) in the US, bitcoin
wouldn't die-- we'd just get left behind in terms of innovation; financial and
otherwise. As an American, I'm hoping that doesn't happen.

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fragsworth
There is another future scenario that is missed here - Bitcoin could fail to
become the "currency of the Internet" but succeed in becoming a digital
investment asset (like Gold bullion).

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markkat
Future scenario 1 could occur and the result could very well be a significant
improvement on the current system.

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Aldo_MX
At this point... what is Bitcoin?

I'm not asking for the definition of cryptocurrency, but what does it mean for
people?

~~~
zanny
Liberation from a financial system designed to exploit everyone but those who
administrate it.

Which does mean option one is diametrically opposed to my definition of
bitcoin, if private enterprise uses proprietary additions to lock in consumers
to their platforms and strattle the flow and generation of capital the way
they do now.

Like others say, it is a huge improvement over the status quo, but not the
kind of resource I want as my store of value.

