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Comment by ftw45 | Hacker News Reader

No, it didn't die and it won't die anytime soon. But dollars, Euro's and all other physical currencies are about to die(soon). Why? Because just like the change from gold and silver coins to almost worthless nickel, this type of currency creates a whole new universe of possibilities.

With nickel and paper money, banks can create as much cash as they like, it's virtual value, not real. Crypto currency is just like that, but more secure and not (yet) controlled by the banks. And again you see the allegations that crypto would be a pyramid scheme etc.. Do people notice that our actual economy/financial-system is a very proven pyramid scheme? All money flows to the rich. And especially those people in power now, are getting a little nervous seeing they might lose some control.

Crypto currencies can be a boon for humanity, unless governments are going to criminalize it and only allow banks to use the technology.

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> But dollars, Euro's and all other physical currencies are about to die(soon).

Are you seriously suggesting that in 10 years there will no longer any physical currencies? Or is soon 50 years? Or 100 years? Can you give a concrete vision for how that would work?

> banks can create as much cash as they like, it's virtual value, not real.

No they can't? The government can, but not arbitrary banks.

> And again you see the allegations that crypto would be a pyramid scheme etc

As I understand it, it's more that it's incredibly unstable, and can be taken over by whomever has the most cpus at any given moment.

I'm sure crypto currencies have lots of uses, especially for more cases around the edge (people in countries with dodgy governments etc), but I can't understand what value it provides outside of that.

I am no expert. At the moment though, if I want to buy a widget online, and I have visa or bitcoin as my options, my choices are either to trust visa, the company that is bound by at least some regulation, has a physical office and PR that can be damaged, or trust a random bitcoin conversion service which is not bound by any regulation, could literally just disappear with my money, could record an internal log of every single transaction and tell it to third parties etc… and then disappear into the night if something went wrong.

Maybe this is all incorrect. But this is the perception that I and others have. So it's either an actual issue, or an issue of bad marketing.

>Are you seriously suggesting that in 10 years there will no longer any physical currencies? Or is soon 50 years? Or 100 years? Can you give a concrete vision for how that would work?

Physical currency is already less than 10% of currency.

>As I understand it, it's more that it's incredibly unstable, and can be taken over by whomever has the most cpus at any given moment.

Stability decreases as value stored in it increases. You can't bootstrap a global decentralised currency without some growing pains. The thing about bitcoin is that is constantly crashes upwards.

>I'm sure crypto currencies have lots of uses, especially for more cases around the edge (people in countries with dodgy governments etc), but I can't understand what value it provides outside of that.

It prevents fraud from Governments. Instead of allowing them to print money when they want, they can't. It allows for global transactions in minutes, 24 hours a day (every day) for far lower transaction fees. It allows an internet of money.

>or trust a random bitcoin conversion service which is not bound by any regulation

You are mixing up a currency with a payment merchant. There's no reason that Visa wouldn't be able to use Bitcoin and charge you like it currently does.

> Physical currency is already less than 10% of currency.

I got my terminology wrong here. I didn't mean physical currency like notes or whatever, I really just meant currencies backed by a government, £/USD etc.

> It prevents fraud from Governments

Doesn't it just replace it with another form of fraud, but this one without any ability to democratically replace it? Specifically, consensus algorithms that fall over if you manage to own enough computing power?

> You are mixing up a currency with a payment merchant.

Sorry, you're right. As someone who has tried to learn about bitcoin et al and never seen the point, the fact that I have to trust another payment provider for no obvious benefit is where I lose interest.

Presumably in the future that won't be the case.

History has recorded hundreds of currencies that now are worth nothing, the only difference with the US dollar its that is going to be a worldwide event

No it probably won't (I mean, it might result from a worldwide event, but it won't likely cause one.)

Most likely, other than being caused by a global catastrophe, is that the center of global finance gradually shifts elsewhere long before the US dollar becomes worthless, and if that ever happens, barely anyone (outside of the US, especially) notices much.

>But dollars, Euro's and all other physical currencies are about to die(soon).

Yeah, your type have been saying that a long time.

No bank can't create cash like they want. There's regulation, authority. Do you know how bank work? Bitcoin and all crypto currency are not secure, a lot of people lose money stole by hacker then why arguing that is secure? because there's some math behind it?

There's no conspiracy with bank or governments, only people that want to be richer and richer, because of this stupid economy. The great democraty, this is the reason, because we failed to put priority about life quality, but about making money = success

Also if people stop looking for conspiracy but start to elect, vote for a more better world where everyone can own the same amount of land (that mean I have right to go to amercia without your passeport because you are not a real amercian, just a Citizen of the World), can have the same access to medecine or wathever, there's no need of money.

We all are little ants.

"No bank can't create cash like they want.", sadly they can.

All they have to do is to lend some money.

Can you go into more detail about what you mean here?

Leverage, banks hold the ability to lend a certain sum of money to multiple parties, thereby 'creating' more money.

The amount of money lent vs the amount of parties is the leverage ratio. It's usually managed well, but can get out of hand pretty quickly.

Edit: Forgot to mention reserve amounts. They are crucial.

Banks don't create money. People treat IOU's after depositing money in banks as money, but they are IOU's not money.

The difference may seem meaningless most of the time, but occasionally it becomes extremely important.

No they can't. There are reserve requirements which limit the amount of bank deposits (not "money") a bank can create.

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