As soon as a critical mass is formed around a particular use case, consortiums, i.e. governments will form to regulate and enforce trust and the system will move to far more efficient centralized ledgers.
Think deeply about what this means. Most people have no idea. Just a few examples (typing on the phone): no company or system can accidentally/intentionally deny your transactions, no merchants can charge you against your will, harder for oppressive government to seize wallets of targeted citizens/organizations, etc.
But I think most people are happy to forego those things and not have to worry about losing significant chunks of cash to fat-finger mistakes or hacks.
When most people barely know what a browser is, illuminating them to the intricacies of bitcoin seems a tall task. And if they can just use some system like Coinbase and "not even know they're using bitcoin," then they're essentially just using Paypal.
It's hard to see how it ever goes beyond a very niche market, and as long as that niche market is in a speculative frenzy it's hard to see how it becomes of much use to that market beyond a vehicle for speculation.
And should some group trade amongst themselves while avoiding censorship from some other group, the persecuted group as it grows in number becomes likely to use it's numerical sway to influence the govt doing the censorship in a new direction, or form a new govt that facilitates more efficient trade between the group.
And efficiency here refers not just to a couple ledgers instead of thousands, but also the massively reduced overhead of every member not having to do extensive security themselves, but rather offloading the security to central authorities.
Trust is beneficial to society, the more trust in a society the better a society scores on a host of other metrics.
Can't off chain systems be seen as simply analogous to transacting in deposited funds with paypal where your paypal password is the signature?
Maybe these systems send something out to a public blockchain, but you're still trusting them to honor withdrawals of your deposited funds in the same way you would with paypal, correct?
What is the actual use in practice of side channels and off chain systems these days?
Here's a little example of setting up a reasonably secure payment channel with the help of an Ethereum smart contract: https://medium.com/@matthewdif/ethereum-payment-channel-in-5...
1. Governments have laws backed by guns to prevent things they don't like (like transactions or investments escaping taxation). If you want to change the system of governance, that's fine, but a currency is not going to do it alone, because they will mandate control over your currency or ban it outright. You can't opt out of government. Perhaps we need a new form of government people subscribe to rather than are opted into at birth, but I don't see bitcoin as a step on that road, as it tries to ignore the question entirely.
2. A cryptocurrency in no way gives you absolute control over your money - like any other currency you are buying in to a system, which has points of control - for example in bitcoin those points of significant control are currently the small group of devs who decide on the rules, and the miners who run the network. Both have the ability to manipulate the currency or lead it in directions you don't like. Past that the currency is a system of trust influenced by everyone who buys it or transactions in it - if that trust fails your money is worthless. So like fiat you have very little control over your money and its value.
3. Censorship resistance - this is the strongest point but still vulnerable because transactions can be traced, and anything you do in the real world can lead them back to your addresses. Given sufficient importance and interest from state actors, I doubt anyone could remain anonymous for long.
4. You seem to be assuming companies and systems will be forced to accept bitcoin (or some other flavour), they can easily deny your transactions by refusing to accept it without validated identity (for example KYC laws).
2. I think your are being pedantic on the definition of "absolute". For all practical purposes, in the entire history of Bitcoin, its users have had absolute control over their money. There has never been a single documented event of a protocol change to block, or miners colluding to block a particular transaction (except obvious bugs like the 2010 int overflow where someone created X billion illegitimate bitcoins.)
3. Again, decentralized cryptos certainly do help evade censorship, compared to traditional centralized financial systems. A bank account is trivial to seize. A Bitcoin warpwallet, not so much.
4. No I don't assume that. I had more in mind the example of a user wanting to donate to wikileaks, and credit card companies deciding to block these transactions. Bitcoin prevents this from happening.
QED. Also see the recent Bitcoin cash fork, and the severe volatility caused by the speculation in the currency, which is a problem for anyone holding it.
A Bitcoin warpwallet, not so much.
I disagree. If it lives on a server a warrant will force them to give it up, if it lives on your computer, a warrant will force you to give the physical computer up (which can then be destroyed or kept indefinitely). It is thus as trivial to seize as the places it is stored, and as your physical being is (pretty trivial).
No I don't assume that. I had more in mind the example of a user wanting to donate to wikileaks, and credit card companies deciding to block these transactions. Bitcoin prevents this from happening.
I agree it was useful for that, but mainly because laws have not caught up with reality. If this were a widespread problem there are of course lots of avenues governments could use to shut off the funds, not least simply outlawing bitcoin, wikileaks, or both. I'm not saying that to be pedantic, but to point out that you're using technology to solve a social/legal problem. It may work for a while if it is not widespread, but laws are enforceable even against unbeatable cryptography because everyone lives in physical space.
If you want true change in your relationship to government, bitcoin won't get you there, because though it seems superficially useful for avoiding government scrutiny, it doesn't address the fundamental problems with it.
Err, this bugfix doesn't show people don't have absolute control of their bitcoins.
"Also see the recent Bitcoin cash fork"
Still doesn't demonstrate that people don't have absolute control of their Bitcoins.
"the severe volatility"
Still doesn't demonstrate that people don't have absolute control of their Bitcoins.
You look ridiculous trying to argue Bitcoin doesn't give absolute control of one's money. That's the one thing Bitcoin does perfectly well and that is universally recognized.
"If it lives on a server"
The point of a warpwallet is that it doesn't live anywhere. It's a passphrase you memorize.
By absolute control I take it you mean control of the private keys and thus who can use the money those keys control (regardless of whether that currency is worthless, difficult to exchange, outlawed, or taxed as an asset)?
For me absolute control means control over the rules for exchange (set by devs), control over fees (set by miners), control over the rules for ownership/use (set by governments), and control of the value vs real world goods (set by other users). I would say bitcoin gives you the illusion of control but very little actual control - it's similar to fiat in that regard.
I think that's important because absolute control implies something you simply can't come close to with any currency - absolute control over a worthless resource is not control in any meaningful sense.
Re the warpwallet, you're saying it lives in your head only, if so, the same arguments apply - they seize your person till you give it up (see rules in the uk on not divulging passwords, people have been locked up for this). You can't work around laws with technical solutions.