
Bitcoin Will Probably Never Be Embraced by the U.S. Government - louismerlin
https://www.forbes.com/sites/omribarzilay/2017/12/21/bitcoin-will-probably-never-be-embraced-by-the-us-government-says-tenx-cofounder-dr-julian-hosp/
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felipeko
The title is so misleading. It's just a interview, and there's nothing in the
interview that gives room for what the title is saying.

> Barzilay: Do you believe Bitcoin will ever be embraced by the U.S.
> government?

> Dr. Hosp: I think that the concept of virtual currencies will definitely be
> embraced, because they have a very transparent transaction ledger. So, we
> know exactly what’s been happening. With bank transfers, it’s quite hard,
> but with fiat money it’s impossible, so I think virtual currencies will see
> a huge uprise by governments. Whether governments will embrace Bitcoin -
> let’s see, but there is definitely value for people. Bitcoin is very
> difficult to hack, it’s almost impossible to steal if you use for example
> multi-signature bolt. And with TenX you can spend Bitcoin pretty much
> anywhere. So, this is the future to go. I don’t think that Bitcoin is going
> to be a currency, but it’s going to have status like gold.

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johnwheeler
"Probably Never" is wishful thinking. They will _never_. Full stop.

Why would the U.S. government tolerate universal currency when it has
something far more advantageous? A currency it controls every other currency
is pegged to (including Bitcoin).

More practically speaking, the government needs the ability to expand the
money supply during financial crises. Bitcoin doesn't lend itself to any of
those Keynesian tricks.

And, government is not "afraid" of Bitcoin. Letting the experiment continue is
more about laissez-faire capitalism than an inability to regulate crypto.

~~~
felipeko
Government does not need this ability, it just wants it.

~~~
alexasmyths
"Government does not need this ability,"

Extremely debatable, given the fact that every nation on planet earth
basically uses monetary policy.

A rational policy whereby currency is exchanged for other assets at a rate
using benchmarks is preferable to a strict currency.

A better economic policy might even allow almost anyone to exchange assets for
currency. Then the market can decide how much is in circulation (though
arguably that is already happening, just the levers are in the hands of a
body, not a distributed group).

~~~
joshlemer
>every nation on planet earth basically uses monetary policy

Not really true, if you consider all the countries that use the currency of an
other.
([https://en.wikipedia.org/wiki/Currency_substitution](https://en.wikipedia.org/wiki/Currency_substitution))

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olivermarks
IMO cryptocurrency is perfectly poised to be the global currency, transcending
nation state central banks and leveraging fiat currency foundations via the
bank for international settlements.
[https://en.wikipedia.org/wiki/Bank_for_International_Settlem...](https://en.wikipedia.org/wiki/Bank_for_International_Settlements)

The interview with the ex kite surfer and trauma surgeon is his opinions based
on his ICO

~~~
Goladus
"Cryptocurrency" can't be "The" global currency since it's not one thing. It's
a collection of currencies, and bitcoin itself won't be the global currency
because there aren't enough bitcoin to be viable for that purpose in the long
run.

~~~
olivermarks
Agreed right now it is a collection of currencies, just like all the different
denominations of fiat currency (USD, Euro etc). It's not hard to see how a
future universal cryptocurrency could emerge though...

------
ringaroundthetx
Different people in the U.S. government will embrace bitcoin, because they are
the people trading bitcoin now. The wealth will bring the influence and the
influence will bring the power.

Some people were flabbergasted when the Fed was buying Mortgage-Backed
Securities off the open market, practically giving one group of people money,
under the guise of stimulating AN economy.

Different people are going to be flabbergasted when the Fed, under a different
group's leadership, starts buying cryptocurrencies by the $ billions every
month, practically giving another group of people money, under the guise of
stimulating AN economy.

And it will still be unaccountable to anyone that cares.

The European Central Bank buys junk corporate bonds simply because a Goldman
Sachs alumni wanted to. The Swiss National Bank buys equity, straight off the
New York Stock Exchange, at valuations it can never make a profit from
dividends from. The Central Bank of Japan buys equity and bonds.

These institutions are funded by the future productivity of tax payers and can
be exposed to heavy losses.

It isn't out of the question that they will buy the spot market in crypto
commodities in the future just because someone familiar with that market is
heading the bank.

~~~
alexasmyths
"practically giving one group of people money, under the guise of stimulating
AN economy."

It wasn't under the guise of anything but saving the US economy from a wicked
meltdown of epic proportions.

The dominos were set to all go down, the Fed kept a few of them up by
rebalancing wealth.

As you point out - viciously unfair - but better in the long run.

FYI - a 'strict currency' is perhaps worse; crisis _will happen_. Strict
currencies ties our boat to the dock, too much or too little water and we're
all smoked. Moreover - outside of crises, the economy is dynamic - growing and
shrinking, monetary policy helps manage that.

A strict currency is better than a poorly managed currency, but a well managed
currency is better than a strict currency.

~~~
etr-strike
> As you point out - viciously unfair - but better in the long run.

That's your opinion, not fact. Banks are larger than ever. Inequality higher
than ever. Housing more expensive than ever. The world is more unstable now
than it was in 2008. Your definition of "better in the long run" is quite odd.

~~~
alexasmyths
No, it's a fact, and a very simple one.

The economy is very intertwined, with the banks at the centre.

If they start to go down - everything starts to do down.

It's as factual as saying if you choke and engine of oxygen, that it will stop
burning.

It's simple cause and effect.

Yes - we understand very well the long-long term moral dilemma of 'too big to
fail' \- this is a well known issue.

And as I mentioned it was 'viciously unfair' \- by the way - when the Fed
absorbed those mortgages, they were saving millions of American homeowners as
well.

A 'market correction' would have implied massive foreclosure across the US.

The 'winners' of the bailout were Banks _AND_ those who owned homes. ALL
American home values were propped up.

the 'losers' of the action were non-property owners.

'The more debt' people were carrying, specifically, 'mortgage debt' \- the
'more free money' got from the Feds actions.

~~~
etr-strike
Still your opinion. In order to accomplish the above, monetary experiments at
a level never before seen were needed. The QE experiment is, at best, half
over (they still need to get rid of all the assets they purchased). Driving
interest rates below the rate of inflation has caused debt to accumulate in
all areas of the economy.

The fact that you think the impacts of the financial crisis are behind us is
hilarious. Just wait till the municipal debt starts to crumble. Places like
Chicago and Puerto Rico have only been able to sustain themselves because of
the low interest rates on debt. The actions of the Fed didn't fix anything,
they just kicked the can down the road.

------
meow_mix
I need to block Forbes. The number of ads they put up is comparable, and
quality of their content is comparable to buzzfeed nowadays

~~~
gruez
You actually want to block forbes.com/sites/, which contains content from
their "contributors " (aka bloggers they lent their name to )

------
oh_sigh
I just can't imagine the world governments okaying the transfer of billions or
trillions of dollars of wealth to people who largely just sat on a technology
from the beginning. Wouldn't the US or some world body, if they were going to
come around to blockchain tech, start their own with a more equitable
distribution(or at least, distribution more in line with what currently
exists).

------
DesiLurker
My thinking is that bitcoin/cryptocurrencies dont have to be 'fully' embraced
by govt, it just needs to be recognized as a valid asset class and the markets
will do the rest. so long as its not too much of a pain to use/keep it will do
just fine. what people dont grasp is that the reason govt or central banks
dont like any other fiat is that it takes power to inflate away from them. so
long as we have fixed references in form of btc/etc markets will ensure they
work as inflation hedge (after an unspecified initial period of price
discovery ;). In fact I do foresee BTC becoming a legit currency after few
unstable currencies fail.

You could argue this was essentially the role of gold but the main problem
with gold is that its the central banks that started with biggest ownership of
gold so its very susceptible to price manipulation and really un-auditable
without some form of trust setup. both of those are not as much of concern
with cryptocurrencies.

TLDR: it will be an asset until it becomes a global currency.

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erikb
Bitcoin has achieved so much already that people considered impossible. If the
government is not able to build their own competitor they'll certainly embrace
it at some point.

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kindfellow92
What does this even mean? BTC is a commodity, the government wins via taxes
when people make gains. That’s like saying the government will never embrace
stocks or real estate.

~~~
heisenbit
The limited number of BTC compared with the demand makes it less a commodity
but more a collectible.

~~~
kindfellow92
Sure

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paloaltokid
Like, duh. Of course the government won’t embrace Bitcoin. It’s an absolute
threat to national sovereignty.

Virtual currencies that are not anonymized - no problem. But not Bitcoin.

~~~
alexasmyths
"It’s an absolute threat to national sovereignty"

It's not a threat to anything but speculators bank accounts.

Nobody is using BTC as a currency.

~~~
chipgap98
I feel like this is akin to saying amazon wasn't a threat to retailers when it
first launched because no one was doing all of their shopping on Amazon at the
time. There is certainly a ton of speculation going on in this space at the
moment, but it seems foolish to write off the entire concept simply because
some people are speculating

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LeoJiWoo
The government will embrace Bitcoin, but not as a currency (unless we end the
Federal Reserve and/or shift back to the gold standard).

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moocowtruck
as much as i want bitcoin i think it would be premature for the us govt to
embrace bitcoin at this point.. the tech around all this stuff needs to
seriously bake and be refined before seriously considering it

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matchcohnn
Why should the US government fear bitcoin??

\- bitcoin isn't usable as a transactional currency. it costs $30-40 per
transaction. Plus other currencies are gaining steam, and offering other
choices for people to transact

\- bitcoin isn't rare to be a store of value.....everyday there's a new viable
cryptocurrency springing up

\- bitcoin isn't safer than dollar.....it can drop 90% in any day; no official
entity is going to prop it up and make sure it doesn't crash. it can be banned
by countries (and has been by a few)

\- bitcoin isn't easy than square cash or wires.....it can take several weeks
to send money. plus the transaction fees are high

