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A recent diary did an interesting job mocking bitcoin, the digital currency favored by libertarians. Although bitcoin has serious flaws, liberals who make fun of it and fail to see the amazing potential of this innovation are missing the point and missing a big opportunity.

I'll get right to the point: Bitcoin is a legal and government-regulated alternative currency, based on open source code. Anyone in the world -- with any political ideology and specific ideas for a different kind of monetary system -- can take the bitcoin code and modify it to create a different digital currency with the features they prefer. Just because bitcoin is the first one that has achieved a multi-billion dollar market cap doesn't mean it will be the last, or necessarily the most successful in the long term.

Many alternative currencies based on the bitcoin code have already been created, ranging from serious ones to joke coins such as "dogecoin." Most of them are get-rich-quick schemes that concentrate wealth in the hands of the early adopters. But it doesn't have to be that way. The technology exists to create a different kind of digital currency based on different values.

The rise of bitcoin -- and the willingness of major governments such as the United States and Germany to consider private digital currencies as real monetary units and legal means of exchange -- has opened the door to the possibility for revolutionary change in the monetary system.

Liberals who mock bitcoin because it's a libertarian invention and currently has some security flaws may be unaware that liberals could create their own digital currencies to compete with bitcoin and the U.S. dollar, and that the security flaws of all digital currencies could be solved with further work by skilled software developers.

The invention of private forms of money may be a much-needed populist alternative to the mainstream, government-issued currency that is managed and distributed according to the interests of Wall Street. The monetary system that controls the U.S. dollar is corrupt, undemocratic and unaccountable, and funnels more and more money to the already rich. When the Federal Reserve creates new money, they do so by giving it to wealthy investment banks, which use it to buy stocks and risky financial instruments such as derivatives. Most of the new dollars being created by the Fed never "trickle down" to ordinary people who run small businesses on Main Street, or who are struggling to pay their bills because of unemployment, underemployment, and the lack of demand in the economy caused by the accumulation of wealth at the top.

The people who created bitcoin didn't like the idea of a centrally managed money supply -- in part because, as libertarians, they are against centralized authority as a matter of principle -- but also in part because everyone should be appalled by the way the mainstream global economic system is based on cronyism at the highest levels: bankers scratching each others backs, giving each other free money created out of thin air and accumulating more and more wealth and power for themselves.

We progressives justifiably believe that some kind of central banking is necessary to create a stable economy, but that doesn't mean we should embrace the Fed and reject the innovation of digital currency entirely. There are ways for digital currencies to include central banking. There are ways for digital currencies to avoid creating more economic inequality, and all the other philosophical and structural problems associated with bitcoin. Alternative cryptocurrencies that learn from the mistakes of bitcoin could make a positive difference! I myself have thought of some detailed ideas for how this could be done, technologically and organizationally. Anything is possible, if you understand the technology and have a creative mind and want to come up with potential solutions to reform the monetary system.

Anyone who wishes to discuss this subject with me in more detail, I invite you to message me. I look forward to a constructive discussion about the potential of digital currency to advance the cause of economic justice.

Originally posted to Eric Stetson on Wed Feb 12, 2014 at 03:58 PM PST.

Also republished by Changing the Scrip.

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Comment Preferences

  •  Tip Jar (7+ / 0-)

    The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

    by Eric Stetson on Wed Feb 12, 2014 at 03:58:42 PM PST

  •  Can you explain to me how bitcoin 'mining' (14+ / 0-)

    and the specialized hardware chips that have been created exclusively for that purpose, and the huge server farms containing them that do nothing but bitcoin mining, is beneficial to society at large? It seems to me like a huge waste of resources.

    Fry, don't be a hero! It's not covered by our health plan!

    by elfling on Wed Feb 12, 2014 at 04:14:14 PM PST

    •  I agree with you. (1+ / 0-)
      Recommended by:
      genethefiend

      The whole "mining" thing is one of the biggest negative aspects of most cryptocurrencies, for the reasons you mentioned. However, a few of them are "pre-mined," meaning that the founder(s) of the currency own all of it and distribute it to others as they wish. Essentially, that is a type of central banking. Then the issue becomes, who owns the money and how do the decisions get made about how and to whom it gets distributed. That's the main area where I think progressives could innovate quite a bit, and improve upon what's already out there among cryptocurrencies.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 04:18:18 PM PST

      [ Parent ]

      •  I'm curious why you didn't mention this in your (0+ / 0-)

        diary piece.  It makes it sound like your diary is a commercial for bitcoin instead of an informative piece.

        Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
        Don't trust anyone over 84414 - BentLiberal

        by BentLiberal on Wed Feb 12, 2014 at 06:46:48 PM PST

        [ Parent ]

        •  I wrote it quickly. Maybe I should do a better one (1+ / 0-)
          Recommended by:
          genethefiend

          This diary was mostly a reaction to the one that made Community Spotlight rather than a deep exploration of my ideas on the subject of digital currencies.

          I'll probably do another diary on this topic in the near future. I think the reaction to this diary has shown me that I need to frame my points differently to be better understood on the controversial subject of alternative currencies. I have very mixed feelings about bitcoin. I think the underlying technology has amazing potential, but that it could/should be deployed in a much more socially beneficial way than the flawed currency of bitcoin itself.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 06:52:48 PM PST

          [ Parent ]

          •  Yeah I think you should (2+ / 0-)
            Recommended by:
            Cassandra Waites, magnetics

            Because honestly this diary sort of had me wondering if you owned bitcoin.

            And another thing to consider: "underlying technology" of a currency system can be like underlying technology of voting machines. It's only as strong, confidence inspiring or honest as the people who control the technology.

            Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
            Don't trust anyone over 84414 - BentLiberal

            by BentLiberal on Wed Feb 12, 2014 at 07:14:40 PM PST

            [ Parent ]

  •  So how do you create a (9+ / 0-)

    digital currency that doesn't concentrate wealth in the hands of early adopters or preference people with computing power?

    (Using only little words. I don't really understand this stuff.)

    "Gussie, a glutton for punishment, stared at himself in the mirror."

    by GussieFN on Wed Feb 12, 2014 at 04:15:55 PM PST

    •  You start by eliminating "mining" and instead (1+ / 0-)
      Recommended by:
      GussieFN

      institute a different mechanism for how the currency gets distributed to users. I prefer a model based on some type of human decision-making (i.e. a central banking model) rather than the "mining"-based model which bitcoin operates on, which favors the early adopters with lots of high-powered computers to use to "mine" (i.e. print) their own money and get filthy rich.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 04:22:02 PM PST

      [ Parent ]

      •  So the basic idea is (5+ / 0-)

        that instead of the Fed, we've got a 'currency authority' comprised of Elizabeth Warren and Bernie Sanders, etc., and there's some sort of governance that makes that authority responsive to … the people, somehow?

        "Gussie, a glutton for punishment, stared at himself in the mirror."

        by GussieFN on Wed Feb 12, 2014 at 04:25:15 PM PST

        [ Parent ]

        •  Theoretically, that's one possible model. (2+ / 0-)
          Recommended by:
          GussieFN, genethefiend

          There could be local currencies, national ones, international ones, and so forth. But essentially, I would say the concept of a "progressive" alternative currency is that it should include some aspect of democratic decision-making about where the new money being created goes.

          That's what we don't have with the Federal Reserve and other national central banks: any role for "we the people" to play in controlling the creation and distribution of the money supply. We have private banking controlled by wealthy oligarchs for private interests (the banks helping the banks), instead of either public or private banking based on some aspect of democratic accountability.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 04:31:36 PM PST

          [ Parent ]

          •  Interesting. (1+ / 0-)
            Recommended by:
            Eric Stetson

            Does it need to be tied to some thing, though? I mean, like bitcoin 'mining' is tied to processing power, right?

            Or is it completely sorta fiat money?

            I mean, if you could 'mine' progcoins via--I don't know--teaching new immigrants ESL and planting trees and reducing your carbon footprint ...

            "Gussie, a glutton for punishment, stared at himself in the mirror."

            by GussieFN on Wed Feb 12, 2014 at 04:46:12 PM PST

            [ Parent ]

            •  That's some good creative thinking. (1+ / 0-)
              Recommended by:
              genethefiend

              Ideas like that are one possible model. It is precisely this kind of open-minded thinking about the meaning of money and how it gets created and distributed that I'm advocating for. If enough people get together and share ideas for alternatives to the current system, viable solutions could be discovered and implemented. Thanks for sharing your ideas.

              The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

              by Eric Stetson on Wed Feb 12, 2014 at 04:50:58 PM PST

              [ Parent ]

  •  By what government is it regulated? Yeah, it's (2+ / 0-)
    Recommended by:
    OllieGarkey, doroma

    probably legal. The question is whether we are moving in the direction of new currencies being purely medium of exchange and not the 'store of value'. We may very well be. B/c bitcoin or any other digital currency is (at this point) rather iffy on the 'store of value' issue.

    •  The U.S. does, for example. (2+ / 0-)
      Recommended by:
      FG, genethefiend
      US regulatory authorities subject Bitcoin to money transmitter regulations, which imposes fairly high regulatory burden on any entity that would envisage, for instance, to operate an ATM for Bitcoin. In March 2013, FinCEN issued an advisory that their rules for combating money laundering and terrorist financing, as well as the state-by-state licensing as money transmitters apply to virtual currency businesses, which must collect and report relevant data.
      Source: Wikipedia.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 04:25:36 PM PST

      [ Parent ]

  •  Here's the reason I don't really get bitcoin, (6+ / 0-)

    except as a one-time get rich quick method. (I really wish today that I'd gone ahead and put $100 in bitcoin when it became available, but I decided that I'd rather not deal with the IRS, especially with silk road and other systems associated with bitcoin.)

    And even if I did end up with a million dollars in bitcoins a few years on, I'd have a huge problem.

    In order for me to turn those Bitcoins to dollars, I'd need someone willing to buy the bitcoins.

    And that's why all these services seem to have popped up, and why there's this huge industry pushing for people to buy bitcoin. Because the folks who made all this money need to cash out quick before it crashes.

    Not a boat I'd mind being in, especially if I'd bought 100,000 bitcoins a few years ago and then just left them alone. But not the most financially stable boat, either.

    All that being said, the reason the dollar has value is because it is backed by the full faith and credit of the United States, and we have never once defaulted on our debts. Not once. We are the world reserve currency.

    The fact that it's backed not only by the most powerful financial system in the world and the most powerful military the world has ever seen means that the dollar has intrinsic value.

    Now unless you run with the SHTF survivalist crowd, you're not someone likely to think that the US government is just going to collapse.

    So the question is, what backs up bitcoin? What makes Bitcoin intrinsically valuable?

    What makes this different from tulip bulbs or packaged sub-prime debt?

    What makes it more than the latest financial fad?

    An Fhirinn an aghaidh an t'Saoghail. (The truth against the world.) Is treasa tuath na tighearna. (The common people are mightier than the lords.)

    by OllieGarkey on Wed Feb 12, 2014 at 04:32:45 PM PST

    •  Yeah, but here's the thing: (2+ / 0-)
      Recommended by:
      Catesby, genethefiend
      The fact that it's backed not only by the most powerful financial system in the world and the most powerful military the world has ever seen means that the dollar has intrinsic value.
      Many people don't want a "we have the biggest guns and rich bankers lording it over everyone else" type of currency to be the basis of the economic system.

      People who are into alternative currencies want some other basis for making a currency intrinsically valuable.

      Bitcoin supporters want it to be based on the fact that there is no centralized control, so it's like "open-source money." Sort of like how people trust Wikipedia even though there is no central authority writing the articles. It's a libertarian model of trust.

      People like me see flaws in that model too, and instead want a form of democratically accountable central banking.

      What I want to see does not exist, which is why I'm not a big supporter of either the Federal Reserve or bitcoin. But I see tremendous potential in the technology that enables alternative currencies to be created. With that technology, people can invent their own models for how to decide "what is money?" and "who should get the money that gets created?" Some models may succeed and others may fail.

      The bottom line, for me, is that the monetary system we have is a financial oligarchy controlled by wealthy banks, and I don't agree with that. I think people can innovate something better.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 04:40:43 PM PST

      [ Parent ]

      •  Wikipedia ... yeah, good example (2+ / 0-)
        Recommended by:
        Chinton, Sparhawk

        Considering you trusted it enough to cite it as a source in an earlier comment, even though it's based on a "Libertarian model of trust" you imply is not trustworthy.

        The problem is not central banks in concept, since you admitted even your "progressive currency" would require some sort of central bank. The problem is "too big to fail" banks, a de-regulated Wall Street and a government corrupted by uncontrolled campaign financing. Those problems can be fixed without trashing the most trusted currency in the world and starting from scratch, especially since you admit there would potentially be a bunch of competing currencies. I see nothing but chaos in that approach.

        I vote we run Rick Scott out of Florida on a high-speed rail.

        by ObamOcala on Wed Feb 12, 2014 at 04:52:07 PM PST

        [ Parent ]

        •  Major political change is one approach. (0+ / 0-)

          But I am not particularly optimistic that the kind of major economic reforms that are needed will come out of the political process in the United States anytime soon.

          I don't knock anyone who tries. I just happen to have come to the view that we also have to be working for progressive change in ways that don't depend on politicians to do the right thing for the people.

          Those who want to work for major economic reform through the political process, my advice is to form some kind of progressive version of the Tea Party, to try to take over the Democratic Party and move it strongly to the left on economic issues. The party we have right now is far, far away from our goals and values -- there's a huge amount of work to be done, even so that economic progressives have a seat at the table of mainstream discourse in Washington.

          As for Wikipedia, I think it proves my point quite well. Most people use Wikipedia all the time, even though it is flawed. Similarly, even bitcoin, a flawed currency, could achieve mainstream use. If even something flawed can enter the mainstream as an important tool -- as Wikipedia has done, and as bitcoin is almost certainly in the process of doing -- then something less flawed could do even better.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 05:01:30 PM PST

          [ Parent ]

          •  And that's fine, too: (2+ / 0-)
            Recommended by:
            Eric Stetson, wilderness voice
            I don't knock anyone who tries. I just happen to have come to the view that we also have to be working for progressive change in ways that don't depend on politicians to do the right thing for the people.
            Inherent value, though, is what I want in my currency. So this is something that I don't oppose at all, and I'd definitely support peoples' right to use such currencies as long as

            A) They don't become tax shelters unaccontable to the IRS and allow rich folks to just offshore all their income in currency that cannot be tracked.

            B) They don't lead to the kind of vulture capitalist payday advance/payday loan systems used by evil people and big banks to charge 300% interest.

            C) These currencies aren't used as a medium of exchange for everything from chemical weapons to sex slaves.

            There's ways we can make sure those things don't happen, and most of the activity will have to revolve around making other things illegal, with the possibility of some very light regulations of the cryptocurrency market. Mostly what we need to do is work to end trafficking in sex slaves and illegal weapons, rather than go after the medium of exchange in question.

            We just remember the Whisky rebellion. Mediums of exchange that aren't government currencies are taxable. That's pretty much settled law.

            An Fhirinn an aghaidh an t'Saoghail. (The truth against the world.) Is treasa tuath na tighearna. (The common people are mightier than the lords.)

            by OllieGarkey on Wed Feb 12, 2014 at 05:21:19 PM PST

            [ Parent ]

        •  Nobody's trying to get rich off Wikipedia. (0+ / 0-)

          The hungry judges soon the sentence sign, And wretches hang, that jurymen may dine.

          by magnetics on Wed Feb 12, 2014 at 10:48:36 PM PST

          [ Parent ]

      •  I'll take my chances (14+ / 0-)

        with the US government, with all its assorted troubles, over some server farm in Hong Kong.

        If the pilot's good, see, I mean if he's reeeally sharp, he can barrel that baby in so low... oh you oughta see it sometime. It's a sight. A big plane like a '52... varrrooom! Its jet exhaust... frying chickens in the barnyard!

        by Major Kong on Wed Feb 12, 2014 at 04:54:32 PM PST

        [ Parent ]

      •  The monetary system is not the issue. (1+ / 0-)
        Recommended by:
        OllieGarkey

        The economy is.

        You can have any monetary system under the sun, but that will not rid your world of wage-slavery, if the multinationals stay in control of manufacturing and trade.

        Yes the economy has replaced industry with finance, but that could be done under any conceivable system of currency.

        The hungry judges soon the sentence sign, And wretches hang, that jurymen may dine.

        by magnetics on Wed Feb 12, 2014 at 10:48:05 PM PST

        [ Parent ]

  •  Umm ... No, I'll mock it, thanks (8+ / 0-)
    The monetary system that controls the U.S. dollar is corrupt, undemocratic and unaccountable, and funnels more and more money to the already rich.
    And a private system in private hands - or better still, a whole bunch of private systems in a whole bunch of private hands, each operating under different rules based upon the political bent of those establishing them, will be more "democratic and accountable" ... How, exactly?

    Do you really believe Wall Streeters won't manipulate any private system of currency organized? If you do, I have a bridge in NYC to sell you. It'll only cost you 2 Bitcoins (or OWSCoins, of Anonymous Coins, or Snowdens, or whatever currency you settle on).

    Here's my problem with the whole "The Fed (and central banking in general) is evil and must be scrapped" canard. The Fed, as it operated under the Randian philosophy of Alan Greenspan - using policies that are beginning to change - did tremendous harm. The European Central Bank, under the policies established by Germany, is doing harm. The British Central Bank, under policies established by the Cameron government, is doing harm. But central banking as a concept is not evil. Japan's central bank, under Abenomics, has been instrumental in turning that nation's "lost decade" around.

    Central banks are only as good as the governments regulating them. You make much of the fact that digital currencies would be regulated by governments. The United States government? The government that has to kick itself in the ass to persuade itself to pay its own bills? That government? The government that is sending threatening e-mails to itself, apparently at the behest of "one of the crazy ones" within it? That government?

    Hmmmm, let me think ....

    I vote we run Rick Scott out of Florida on a high-speed rail.

    by ObamOcala on Wed Feb 12, 2014 at 04:39:58 PM PST

    •  Did you mock the internet too? (0+ / 0-)

      When that was invented?

      Whether you like it or not, the technology has been created which makes it possible to create competing currencies that are not government controlled. As long as the government allows it, it will continue to happen, and I predict the phenomenon will continue to grow, because lots of people like the idea of it and see it as an improvement on the current monetary system.

      There were many people who preferred paper newspapers too, when the internet started. Now, few do. Things change. Innovation keeps happening. Cryptocurrency is a major technological innovation. Mock it if you wish, but I think you're mistaken if you think it's all just going to go away.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 04:45:12 PM PST

      [ Parent ]

      •  You may be confusing two things. (10+ / 0-)

        Technological innovation and societal innovation.  I have no doubt that Bitcoin is a technological innovation.  That doesn't necessary make it benign, functional, or anything else that references its articulation to the meat world.  The Internet isn't an ideal example to invoke because that was about the tech itself in a way that Bitcoin's not.

        It's not the side effects of the cocaine/I'm thinking that it must be love

        by Rich in PA on Wed Feb 12, 2014 at 04:55:46 PM PST

        [ Parent ]

        •  Did you read my diary? I'm not pro-bitcoin. (0+ / 0-)

          I'm in favor of using the technology behind bitcoin to create a better alternative. I am actually quite critical of a lot of aspects of bitcoin. I think the technology could be used in a much more positive way, if combined with appropriate societal innovation.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 05:03:59 PM PST

          [ Parent ]

      •  just don't be holding it when it crashes (2+ / 0-)
        Recommended by:
        wilderness voice, Wee Mama

        Like Tulips and beanie babies, you don't want to be the last one holding it before the crash.
        You maybe do not trust the US financial system but there's nothing in bitcoins that makes it more secure, actually a whole lot less.
        Very ill advised to put serious money into this

        Happy just to be alive

        by exlrrp on Wed Feb 12, 2014 at 04:59:17 PM PST

        [ Parent ]

      •  Well, first of all ... (2+ / 0-)
        Recommended by:
        exlrrp, BentLiberal

        ... I worked an entire career in the paper newspaper industry, and still read them.

        The Internet is a great tool, but as we're currently seeing in the fight over net neutrality, there are issues with corporate control of the infrastructure.

        I don't see how private currencies would fare any better.

        I vote we run Rick Scott out of Florida on a high-speed rail.

        by ObamOcala on Wed Feb 12, 2014 at 04:59:39 PM PST

        [ Parent ]

      •  So any technology invented is good? (0+ / 0-)

        That's what you seem to be saying here.

        Did you mock the internet too? (0+ / 0-)

        When that was invented?

        Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
        Don't trust anyone over 84414 - BentLiberal

        by BentLiberal on Wed Feb 12, 2014 at 06:53:30 PM PST

        [ Parent ]

        •  No. But I do think the tech that enables altcoins (0+ / 0-)

          has the potential to do a lot of good. A lot of evil too. Just like most truly revolutionary technologies.

          My point regarding the internet is that it changed everything, but a lot of people mocked it when it first came out and were skeptical that it would ever catch on. I think digital currencies are likely to follow a similar track. And just like how some of the first big internet companies did not last (e.g. Netscape faded away and Google took over the search space), some new and better digital currency may (and hopefully will) overtake bitcoin.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 06:57:42 PM PST

          [ Parent ]

          •  Ok, but the difference is those are just companies (0+ / 0-)

            People that invest in them know they are speculating or should know.

            To casually talk of a currency system not working out sort of seems to ignore that that "not working out" means lots of people lost money, on something that is just supposed to be a means of exchange, not a speculative investment.

            Anyway, I look forward to the more thoughtful diary if it ever comes around.  And I've not even read the other diary either that you reacted to so I'm definitely not endorsing it either

            Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
            Don't trust anyone over 84414 - BentLiberal

            by BentLiberal on Wed Feb 12, 2014 at 07:15:37 PM PST

            [ Parent ]

            •  The other diary made some valid points. (0+ / 0-)

              I encourage you to read it.

              But as I said in another comment, I think the mockery of bitcoin on the left is somewhat unhelpful. The technology has amazing potential; it just needs to be used in a better way.

              In short, I think it's entirely reasonable to criticize bitcoin and point out its flaws, but it's also important to study the technology of cryptocurrency and see if we can learn the lessons that bitcoin -- its successes and its flaws -- can teach us, and the potential relevance of this technology to progressive economics. JMHO.

              The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

              by Eric Stetson on Wed Feb 12, 2014 at 07:52:47 PM PST

              [ Parent ]

              •  I read it and didn't find it mocking at all (1+ / 0-)
                Recommended by:
                elfling

                Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
                Don't trust anyone over 84414 - BentLiberal

                by BentLiberal on Wed Feb 12, 2014 at 07:58:20 PM PST

                [ Parent ]

                •  Much of it focuses on how bitcoin price recently (0+ / 0-)

                  has gone down, and uses this as supposed evidence that the currency stinks. However, anyone who has been holding bitcoins for longer than a few months has done much better than holding U.S. dollars.

                  Analysis of the viability of bitcoin which focuses on short-term price fluctuations does seem like mockery to me, since the reason for the short-term price fluctuations is because the market cap of the entire currency is only a few billion dollars. Something with such a small market cap is going to fluctuate a lot in value with positive and negative news. If bitcoin ever catches on among the general public, the market cap would increase a lot, which would dampen out most of the volatility (buys and sells wouldn't move the market as much).

                  I thought the other diarist made some good points, but the overall tone of the diary was to bash bitcoin rather than provide a balanced "here are the pros and cons" take on it. Obviously, that diarist is entitled to their opinion, but it is what it is: a one-sided view of the subject.

                  The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

                  by Eric Stetson on Wed Feb 12, 2014 at 08:10:35 PM PST

                  [ Parent ]

                  •  Then you should have said that in your diary (0+ / 0-)

                    That diary made real world points -- you refuted none of them. Instead you dismissed it in a half sentence in the beginning of your diary as "mocking' with no proof, no refutation. That doesn't buy you much cred.

                    The other diarist told of real things. You dismissed (and didn't refute) and then talked about theoretical things.

                    Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
                    Don't trust anyone over 84414 - BentLiberal

                    by BentLiberal on Wed Feb 12, 2014 at 08:42:17 PM PST

                    [ Parent ]

                  •  I didn't read it that way at all (0+ / 0-)

                    I read it as an account of the practical difficulties in working with bitcoins for a real world expenditure.

                    Making a new currency is tough. You need dedicated early adopters. It's probably not ideal for them to be people trying to use them for questionable transactions, as has been a major situation with bitcoin.

                    Some local people have created local currencies based on human labor in various places, including my local area. Those are a bit more interesting to me, but again, they take a lot of effort to maintain, and one has to wonder if that is the best use of those people's energy and enthusiasm.

                    Fry, don't be a hero! It's not covered by our health plan!

                    by elfling on Wed Feb 12, 2014 at 11:31:13 PM PST

                    [ Parent ]

      •  The internet exists because of Arpanet, a (0+ / 0-)

        government program.  That's where the infrastructure came from.  Yes the infrastructure has expanded, but the paradigm was set with Arpa (now Darpa.)

        The hungry judges soon the sentence sign, And wretches hang, that jurymen may dine.

        by magnetics on Wed Feb 12, 2014 at 10:52:46 PM PST

        [ Parent ]

  •  We had a system like that once (9+ / 0-)

    Obviously it wasn't digital, but there was a time when states and banks could simply mint their own currency.

    It worked about as well as you think it did, which is why we have centralized currency now.

    If the pilot's good, see, I mean if he's reeeally sharp, he can barrel that baby in so low... oh you oughta see it sometime. It's a sight. A big plane like a '52... varrrooom! Its jet exhaust... frying chickens in the barnyard!

    by Major Kong on Wed Feb 12, 2014 at 04:52:29 PM PST

    •  The South had its own currency as a product of its (1+ / 0-)
      Recommended by:
      magnetics

      Own sovereign (in its eyes)  government.  That didn't work out so well either.

      © grover


      So if you get hit by a bus tonight, would you be satisfied with how you spent today, your last day on earth? Live like tomorrow is never guaranteed, because it's not. -- Me.

      by grover on Wed Feb 12, 2014 at 10:38:06 PM PST

      [ Parent ]

  •  We have a monetary system.... (1+ / 0-)
    Recommended by:
    grover

    ...that's pretty fantastic.  Of all of the aspects of our economy, the one I'm the least inclined to mess with or compete with is our monetary system.  

    It's not the side effects of the cocaine/I'm thinking that it must be love

    by Rich in PA on Wed Feb 12, 2014 at 04:53:20 PM PST

    •  And largely digital currency; notes and coin are (1+ / 0-)
      Recommended by:
      elfling

      A small fraction of money, and most transactions are electronics debits and credits.

      The dossier on my DKos activities during the Bush administration will be presented on February 3, 2014, with an appendix consisting an adjudication, dated "a long time ago", that I am Wrong.

      by Inland on Wed Feb 12, 2014 at 04:57:55 PM PST

      [ Parent ]

    •  I don't really understand the resistance. (1+ / 0-)
      Recommended by:
      Eric Stetson

      I mean, this doesn't seem like the kind of thing that replaces or undermines our monetary system. Our monetary system will be okay.

      But bitcoin--if what I read is true--seemed to be a way for like-minded people to basically barter. I'd spend my bitcoin on other bit-o-philes' businesses, right? If you accepted it, I'd spent my 'coin' on your stuff, instead of on the non-bitcoin-vendor next door.

      This strikes me as a great model for supporting progressive businesses--if, that is, the exploitive stuff is handled.

      Not a model for REVOLUTION! OVERTHROW THE FED! But for supporting likeminded businesses.

      "Gussie, a glutton for punishment, stared at himself in the mirror."

      by GussieFN on Wed Feb 12, 2014 at 05:25:36 PM PST

      [ Parent ]

      •  If you'd like, I can explain it to you (4+ / 0-)

        1) Bitcoin is extremely computing-power-intensive (and therefore energy-intensive), both to mine and to process transactions in. I seem to recall that it's a couple of orders of magnitude more than paper money is, and much worse than that when compared to bank transactions. One of the advantages of paper money is that it doesn't require you to dig huge amounts of metal out of the ground to keep up with demand for gold coins. Bitcoin reverses that to an extent that may surprise you. (Right now the energy used by bitcoin transactions, for the tiny number of transactions that occur, is similar in size to a medium-sized town. If we replaced 1/10 of our commerce with bitcoin, it would be bigger than the energy demands of many states.

        2) Bitcoin may or may not be a threat to our monetary system, but it very much is a threat to our government. Because it is carefully designed to be almost impossible to track, absent surveillance that would make what we are discovering exists now look very tame by comparison. This means that without the government watching every byte that goes in and out of your computing devices, and being able to decrypt them all, they can't see what your bitcoin transactions are. And if they can't do that, they can't tax you accurately, if you, e.g., are paid in bitcoins. Starving the government of funds suddenly becomes trivially easy. And let's face it: we know that all the libertarians would do it because they hate government, and all the conservatives would do it because they don't give a shit.

        3) Bitcoin, and almost every other crypto-currency, started out with somewhere between 20 and 50 percent of all of the specie that it is EVER POSSIBLE TO CREATE in the hands of the group who created it.

        Now, clearly, you could solve 3, by issuing bitcoins from the fed. And you could solve 2 by having every transaction have to be processed by the fed. (This, while intrusive as all fuck, is WAY less intrusive than the monitoring necessary to monitor bitcoins as they are now.) But you can't solve 1 without making your money hackable, as far as I know. Either transactions take a lot of energy, or reversing the encryption/signing algorithm is easy enough that someone, with a lot of time and hardware, could do it. And once that happens, you are royally screwed.

        Honestly? It's just basically a terrible idea in nearly every way.

        •  Interesting how people see things differently. (1+ / 0-)
          Recommended by:
          Sparhawk

          To me, the fact that digital currency makes it harder for the government to know what people are doing with their money seems like a feature, not a bug. I don't want the government spying on everyone. I am against NSA domestic surveillance, and I am also against having the government snooping in people's bank accounts.

          As for your point #3, as I mentioned in the diary, a different cryptocurrency wouldn't have to be done that way. I specifically addressed this issue in the diary -- the fact that most cryptocurrencies concentrate wealth in the hands of the founders, as well as the fact that it doesn't have to be done this way.

          As for your point #1, this problem could be reduced by making a cryptocurrency that is not based on mining. And it could be reduced even more, through software upgrades that people in the bitcoin/altcoin development community are already starting to work on.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 05:56:46 PM PST

          [ Parent ]

          •  I heard an NPR story about a vendor in Iran who (0+ / 0-)

            has used  Bitcoin to get around sanctions entirely. He buys silk and other lovely fabrics from Asia and sells garments (mostly hijab) to people globally, including women in America.

            Now, he seemed like a lovely man, and he sounds like he's filling a need for nice hijab in the west.

            But sanctions were there for a reason. I hate what they were doing to average folks like this nice man. But we either support peaceful UN actions intended to get difficult countries to the table-- or we don't.

            And if he's able to easily use bitcoin to circumvent UN sanctions, I'm thinking there are probably a lot of far more untoward transactions going on.

            It's not always about Americans and dodging NSA.

            © grover


            So if you get hit by a bus tonight, would you be satisfied with how you spent today, your last day on earth? Live like tomorrow is never guaranteed, because it's not. -- Me.

            by grover on Wed Feb 12, 2014 at 10:49:58 PM PST

            [ Parent ]

          •  If it's on a server, it will be hacked. (0+ / 0-)

            By the Feds.

            The hungry judges soon the sentence sign, And wretches hang, that jurymen may dine.

            by magnetics on Wed Feb 12, 2014 at 10:55:34 PM PST

            [ Parent ]

        •  So is #1 a limitation (0+ / 0-)

          of all-possible-digital-currency schemes, or just of bitcoin?

          Because it seems to me that the idea--which, granted, is vague to the point of vaporousness--is to avoid the whole 'mining' stage entirely.

          "Gussie, a glutton for punishment, stared at himself in the mirror."

          by GussieFN on Wed Feb 12, 2014 at 05:59:02 PM PST

          [ Parent ]

          •  This diary is just to spark some discussion. (1+ / 0-)
            Recommended by:
            GussieFN
            the idea--which, granted, is vague to the point of vaporousness
            I wrote this diary to try to find other people here among my fellow progressives who might like to share ideas with each other, to try to come up with the best possible way to create a better alternative digital currency that would uphold and advance progressive values. If it seems vague, it's because I'm not promoting anything yet except a general concept. I think that's where people should start: with the big picture first. Details need much more thought and discussion.

            The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

            by Eric Stetson on Wed Feb 12, 2014 at 06:11:34 PM PST

            [ Parent ]

            •  I suspect that a (4+ / 0-)

              less 'don't mock bitcoin' title might serve you better. Like 'Is a Progressive Bitcoin Possible?' To try to get people engaged in the idea instead of defending their (well-grounded) dismissiveness of bitcoin itself.

              That is, if you state up front that a 'Progressive Bitcoin' should

              1) Not be extremely computer-power-intensive, and
              2) Allow for fair taxation, and
              3) Not be concentrated in the hands of the early adopters (which, granted, you did--and were ignored), then

              perhaps you might get more discussion than dismissiveness?

              Now, I'm not sure if 1-3 are even theoretically possible. But if they are, then objections like Fred Fnord's can be addressed.

              "Gussie, a glutton for punishment, stared at himself in the mirror."

              by GussieFN on Wed Feb 12, 2014 at 06:18:37 PM PST

              [ Parent ]

              •  Good suggestions. Maybe I'll try that approach (1+ / 0-)
                Recommended by:
                elfling

                with another diary on the topic in the near future.

                The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

                by Eric Stetson on Wed Feb 12, 2014 at 06:22:14 PM PST

                [ Parent ]

              •  Thanks Gussie (0+ / 0-)

                That's the same impression I had of this diary. The diary came of as high-handed to me and the title is an admonishment.

                The the diarist in the comments is telling people, "Didn't you read the diary?"  Where really, I don't think he conveyed what he thinks he did with the diary.

                Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
                Don't trust anyone over 84414 - BentLiberal

                by BentLiberal on Wed Feb 12, 2014 at 07:02:24 PM PST

                [ Parent ]

                •  People shouldn't mock revolutionary technologies. (0+ / 0-)

                  I stand by that, even if it comes across as an admonishment. I get the impression that many people on the left have a knee-jerk reaction of mockery against the entire technology space of digital currency, and I think that is a huge mistake. Ceding this important terrain of innovation to libertarians, simply because we don't agree with some aspects of bitcoin, its first implementation, would be very unwise. It would be like if the first websites had been created by conservatives, and therefore liberals wrote off the whole concept of the internet.

                  The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

                  by Eric Stetson on Wed Feb 12, 2014 at 07:07:49 PM PST

                  [ Parent ]

                  •  Well Eric, good luck but (0+ / 0-)

                    I think you are super-defensive about your diary and not looking for a give-and-take exchange.  

                    And I've already told you why your generalization about technology is too sweeping, and that equating the internet to a currency system is apples and orange as far as what is at risk.

                    You say you looking for a give-and take, but your writing and subsequent comments belie that.

                    We're talking past each other and so I'm done.

                    Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
                    Don't trust anyone over 84414 - BentLiberal

                    by BentLiberal on Wed Feb 12, 2014 at 07:31:15 PM PST

                    [ Parent ]

                    •  You sound way too invested in your criticism. (0+ / 0-)

                      I listened and responded cogently to your points. I even agreed that I could have done a better job explaining my ideas in this diary. But I'm not always going to agree with everything that every commenter says who criticizes my ideas or my diary. What do you expect, that I'm just going to pretend to agree with everything you say? That's not a give-and-take either.

                      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

                      by Eric Stetson on Wed Feb 12, 2014 at 07:40:55 PM PST

                      [ Parent ]

                  •  I don't think it's the technology (1+ / 0-)
                    Recommended by:
                    grover

                    being mocked. I think it's the whole alternative money concept combined with the speculative mania.

                    I mock it because I find it funny, and I find it funny because basically I find it incomprehensible. It's funny the way tulipmania is funny, only at least the tulips were real.

                    When and if I feel like I understand it, then I will decide to take it seriously or not. Meanwhile, I don't see this as a progressive political concern.

                    •  Yup. (2+ / 0-)
                      Recommended by:
                      elfling, denise b

                      I'm finding myself resistant to the "progressives shouldn't mock this great libertarian idea!" narrative.

                      We're progressives. We tend to trust the idea of government. We may want to repair parts of THIS government.  

                      But I, for one, understand why the Fed was created. The financial panics and crises that gave rise to the Fed make 2007-2009 look like a walk in the park. We need to fix the Fed. Libertarians want to dismantle the Fed and sell off every desk, adding machine,and laptop on eBay.

                      So if they create an alternate currency, I'm going to be very skeptical. I'll listen. I've been reading a lot about bitcoin. But I'm extremely skeptical.

                      © grover


                      So if you get hit by a bus tonight, would you be satisfied with how you spent today, your last day on earth? Live like tomorrow is never guaranteed, because it's not. -- Me.

                      by grover on Wed Feb 12, 2014 at 11:00:28 PM PST

                      [ Parent ]

                •  I don't find it high-handed at all. (0+ / 0-)

                  Just vague. But I do think it hits the precise spot that guarantees more criticism than engagement.

                  "Gussie, a glutton for punishment, stared at himself in the mirror."

                  by GussieFN on Wed Feb 12, 2014 at 08:08:02 PM PST

                  [ Parent ]

                  •  Fair point. Also, I read the other diary now (0+ / 0-)

                    and found no mocking.  Just an account of real world experiences with bitcoin that this diarist didn't refute at all.

                    I think that's what bugged me.  He called it mocking in the title and then devoted half a sentence to that assertion, which simply dismmiss the other diary but didn't refute it (let alone address it)

                    I can only conclude that this diarist calls it mocking because he disagrees with it. But again, he provided no refutation whatsover. Almost like the callout was a device intended to propel his won diary.

                    Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
                    Don't trust anyone over 84414 - BentLiberal

                    by BentLiberal on Wed Feb 12, 2014 at 11:06:32 PM PST

                    [ Parent ]

  •  I don't want to get rid of central banks. (0+ / 0-)

    Isn't that the entire point of the whole exercise?  

    The dossier on my DKos activities during the Bush administration will be presented on February 3, 2014, with an appendix consisting an adjudication, dated "a long time ago", that I am Wrong.

    by Inland on Wed Feb 12, 2014 at 04:53:59 PM PST

  •  What are your ideas for an alt currency then? (0+ / 0-)

    Let's hear it. Why all the secrecy?

    •  Democratic and not mining-based. (1+ / 0-)
      Recommended by:
      icemilkcoffee

      Those are the basic principles of what I think it should be like. I'm not going to into a whole lot of details in this diary, because my ideas aren't fully formed yet, and because the additional details that I have already thought of are not relevant at this stage. I'm just trying to find out how much open-minded interest there is among progressives about the concept of alternative digital currencies and who on Daily Kos I should talk to more about it, one-on-one, at this stage, to exchange more in-depth ideas and maybe start forming a group for further discussion.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 05:43:05 PM PST

      [ Parent ]

  •  Bitcoin has "some security flaws" ? (1+ / 0-)
    Recommended by:
    elfling

    That is an understatement!

    I encourage you to go over to bitcointalk.org. There are stories there that are heart breaking. Good people who just want to see if they can make a little money by investing in bitcoin, only to get their coins stolen or they are scammed. I feel for these people. There are many, many stories on that site that point out a major problem with bitcoin:

    unless bitcoin is seen as a stable currency that people can trust, it is going nowhere.

    Now the technology of bitcoin is important and good. Yes, learn from that. But as a currency, bitcoin is 100 percent risk.

    •  Yes, bitcointalk.org is excellent. (0+ / 0-)

      People should do their due diligence, as I have done. It is quite possible to own and use bitcoins (or other digital currencies) and not lose them to hackers and thieves. But people really have to study the currency, how it works, and what are the risks and the various institutions that deal in bitcoin and the pluses and minuses of each one. Like you, I found bitcointalk.org to be an excellent source of information, both positive and negative. I guess the difference between us is that I'm also interested in reading about the positive aspects of this technology, rather than only the horror stories. The technology is still in its infancy.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 06:16:24 PM PST

      [ Parent ]

      •  The two aspects of bitcoins: (2+ / 0-)
        Recommended by:
        Eric Stetson, elfling

        (1) the technology, which I think has great potential;

        (2) the actual (current) system, which does not instill confidence. I mean, would you put your money in a system
        with the caveat, "it is quite possible that you may not lose your investment" ?

        Maybe something more stable will be born from bitcoin.

      •  That's WAY too complicated for a currency (0+ / 0-)
        It is quite possible to own and use bitcoins (or other digital currencies) and not lose them to hackers and thieves. But people really have to study the currency, how it works, and what are the risks and the various institutions that deal in bitcoin and the pluses and minuses of each one.
        That describes a stock market, not a currency.

        Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
        Don't trust anyone over 84414 - BentLiberal

        by BentLiberal on Wed Feb 12, 2014 at 07:05:27 PM PST

        [ Parent ]

        •  Cryptocurrency is an infant technology. (1+ / 0-)
          Recommended by:
          elfling

          It hasn't reached the level of development yet to enable Average Joe to use it with comfort and security. But that doesn't mean it won't, or shouldn't.

          The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

          by Eric Stetson on Wed Feb 12, 2014 at 07:09:40 PM PST

          [ Parent ]

        •  It describes an emerging market stock market (0+ / 0-)

          the kind where the government can just nationalize your investment etc.

          One of the cool things about a $20 bill is that I don't have to do much in the way of studying to use one safely and effectively. That, after all, is the whole point of why we have money.

          Fry, don't be a hero! It's not covered by our health plan!

          by elfling on Wed Feb 12, 2014 at 11:37:59 PM PST

          [ Parent ]

  •  Have I got a deal for you (0+ / 0-)

    I invented my own currency too. I will trade U.S. dollars for it. Message me and give me your credit card number. Snark.
    I believe we have more pressing matters to deal with. I believe it is a flash in the pan. A shiny object. You sorta lost me at Libertarian. All I see is Ron Paul's creepy mug with Racist Superman standing behind him.

    “He talks a lot and he's not very bright. And that's a combination I like in Republicans.” James Carville

    by Mokislab on Wed Feb 12, 2014 at 07:24:02 PM PST

  •  I read the diary which you said "mocked" bitcoin (4+ / 0-)

    From your description I expected a facile diary that made fun of bitcoin while offering no explanations of how bitcoin worked and no analysis.

    What I found instead was a diarist who wrote about their actual experience with bitcoin. A real experience with real bitcoin. Diary explained how it was obatained, and what diarist had to do to get value (something the diarist wanted) from his bitcoin.

    The story explained how that when Googling he found lots of way to buy bitcoin but decidedly fewer ways to sell bitcoin (obtain something of value to the diarist)

    He even quoted some analysis from Krugman.

    So how that can be equated that to mocking, is lost on me. Diarist gave real-world examples of how it didn't work for him. I'd like to see a reaction diary either refute that, or agree with it.

    Il est dangereux d’avoir raison dans des choses où des hommes accrédités ont tort. - Voltaire
    Don't trust anyone over 84414 - BentLiberal

    by BentLiberal on Wed Feb 12, 2014 at 07:53:22 PM PST

    •  That diary made some good points. (0+ / 0-)

      I think that diarist made a useful contribution to the discussion of bitcoin. But I think there was too much of a tone of mockery in that diary as well.

      The reason it's sometimes difficult, complicated, and risky to use bitcoin is because the technology is still very new. The diarist didn't seem to want to take that into account; instead, the purpose of the diary seemed to be simply to try to persuade people that bitcoin is dumb.

      As I said in another comment, I have no problem with criticism of bitcoin. It deserves some criticism. But there is also much to praise about it, or at least the underlying technology of it and the way it could empower people. I see both sides of the bitcoin debate. I wrote this diary to point out that digital currency does have a positive side to it for progressives -- even if bitcoin itself is flawed.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 07:58:30 PM PST

      [ Parent ]

  •  Fairly expressed and (2+ / 0-)
    Recommended by:
    Eric Stetson, elfling

    I think you handled yourself well in comments, regardless of some of the surprising flack sent you way.

    When you say libertarian - do you mean in a philosophically international way? I was under the impression that the bitcoin coders were not Americans.

    •  Thanks. I meant libertarian in a broader way (1+ / 0-)
      Recommended by:
      elfling

      than the purely American political version of it. Libertarian in the sense of opposing centralized/hierarchical control and favoring decentralized institutions and solutions to problems. I actually feel there is some overlap between this broader sense of libertarian and some versions of liberalism, but in America they tend to be very clearly delineated from each other.

      As for the bitcoin coders, the founder is supposed to have been a person or group of people in Japan. But over the past year or so, I have gotten the distinct impression that bitcoin has developed something of a cult following especially among Americans, and especially American libertarians. It bothers me to see that the innovation of cryptocurrency has come to be so strongly identified with one particular political persuasion.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Wed Feb 12, 2014 at 08:18:54 PM PST

      [ Parent ]

  •  Two ways to look at Bitcoin (0+ / 0-)

    It's either a digital gold standard that will fail to replace the dollar for all the same reasons the gold standard is bad for economies.

    OR

    It's an open source protocol for exchanging money without the involvement of the existing big banks that siphon wealth out of the economy.

    Bitcoin doesn't have to replace the dollar. It can replace MasterCard, Visa, predatory check cashing, and maybe even end overdraft fees.

    Like most liberals, I was deeply skeptical and hostile towards bitcoin. The gold standard is a failure, Ron Paul is a jackass, and it should be clear by now that central banking is better at maintaining a stable economy than miners and hoarders.

    But banks hate bitcoin, because it puts some of their business out of business. And that on its own is a reason for liberals to take another look at bitcoin. Not as a replacement for the dollar, but as a technology that allows people to exchange value without the involvement of banks.

    This is a huge deal, and the economy can benefit from it and still be based on dollars managed by a central bank.

    It's definitely an experiment, there are all sorts of rough edges, and maybe bitcoin will fail to benefit humanity. But it's worth exploring and yes, learning from it.

  •  It's a world (0+ / 0-)

    where the offerings of the ponzi schemes end up underperforming the market.

    Surely that deserves some mocking?

  •  Dogecoin is less a joke than bitcoin, as it (0+ / 0-)

    is going to allow for monetary inflation/elasticity:

    http://arstechnica.com/...

    Also, you might want to learn a bit about how our monetary system actually works.  Here's a beginning:

    http://www.economonitor.com/...

    •  Thanks for the article about dogecoin. (0+ / 0-)

      I'll study it further.

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Thu Feb 13, 2014 at 03:13:04 PM PST

      [ Parent ]

  •  Jeeze you take a lot of crap in the comments (1+ / 0-)
    Recommended by:
    Eric Stetson

    For a good essay.  Your replies are textbook calm thank you and good job.  Any conversation that gets people thinking about what we agree is money and who makes what money is great.  Money seems to occupy an odd spot in the human mind where seemingly basic questions incite fierce emotion and debate.

    Every currency is created somewhere, and who makes it first and gives it to who under what conditions matters.

    Personally the mining aspect of bitcoin is currently backwards.  If anything currency should be created by creating energy not consuming it.

    Anyhoo good essay, you got people to read and think which is a good thing.

    When we talk about war, we're really talking about peace.

    by genethefiend on Thu Feb 13, 2014 at 06:09:52 AM PST

    •  Thanks. Good points! n/t (1+ / 0-)
      Recommended by:
      genethefiend

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Thu Feb 13, 2014 at 03:15:08 PM PST

      [ Parent ]

    •  Thanks. Good points! n/t (0+ / 0-)

      The most serious problem in American politics today is that people with wrong ideas are uncompromising, and people with good ideas are submissive and unwilling to fight. Change that, and we might have a real democracy again.

      by Eric Stetson on Thu Feb 13, 2014 at 03:20:03 PM PST

      [ Parent ]

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