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Comment by _7fvc | Hacker News Reader

I think Satoshi didn't know that Bitcoin would not be a medium of exchange. It will remain digital gold. Bitcoin cannot fulfill its original promise to be electronic cash. This is the hardest hurdle for bitcoiners to understand. They think that sky high value of Bitcoin would transform it into a medium of exchange. But I think it's a false promise from Satoshi.

https://bitflate.org/post/2019/11/24/bitcoin-will-not-be-a-m...

The biggest hurdle for cryptocurrency adoption is a medium of exchange. Most investors waste their time playing around with buzzwords like DeFi.

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> Bitcoin cannot fulfill its original promise to be electronic cash.

Not as long as the Bitcoin core developers are actively sabotaging BTC's development so Blockstream can sell you the solution. Bitcoin was hijacked and it may never recover.

Lol, what? Only a small portion of Bitcoin Core contributors work at Blockstream. You should think critically rather than merely accepting as facts everything Bitcoin Cash proponents tell you.

As someone who was mining bitcoins in the very early days, like one every few hours, bitcoins has many flaws. The biggest issue is when you lose your password, you cant get your money back, over time there will be an increasing number of bitcoins that dont go anywhere, just like Satoshi doesnt spend theirs. When looking at it from a different perspective of watching network traffic at 5 eyes level, I also think of the makers of Tor, these "tools" may have the popular misconception for being secure, but now I just look at them as a 5+x eyes intelligence tool.

Here is a challenge to test this theory, computer hacking is illegal right, but satoshi's identity remains a mystery, they cant prove their identity in a court of law, so hack "his" bitcoin account and move his bitcoins to another bitcoin account. "He" will have to come forward to garner the help of the authorities to get his bitcoins back, ergo we will get to find out who Satoshi really is!

Put it like this, as an exercise, it will be interesting to see in court how "he" proves his identity. Do you see the problem?

Whats that Thomas Pynchon quote?

I don't understand what the problem you are referring to is.

That's a feature, not a bug. The government cannot hand over ownership of your btc. That's the whole point of decentralized.

The forgetting your password thing may be an issue for the person who forgets their password, but it is not an issue for the network. Those btc are out of circulation, sure, but there's lots more out there that people can exchange. Just don't forget your password and you'll be fine.

An escrow vs a currency.

(File under "hunch, but just guessing.")

I’m not convinced either if it can become currency but in my opinion if it will only ever become digital gold, an arguably superior version of physical gold, it’ll already be a great achievement.

Layer 2 will solve this.

Layer 2 does not solve the medium of exchange problem. The cause is volatility which is rooted in Bitcoin's limited supply design. You can dig in Layer 2 adoption. It's not growing. Bitcoin only has 2 use cases: hold and speculate. Transaction is not a use case.

Layer 2 is not necessary until Layer 1 has some kind of stability. Layer 2 can also malfunction during volatility. Ethereum has demonstrated this.

Need I remind you that the world has been running almost exclusively on gold, which also has a limited supply "design"? That is if you look back a few thousand years. Deeply flexible currencies are mostly a recent invention, and their fate is not yet determined.

Volatility is a result of lack of actual usage of the currency. And yes, bitcoin has virtually no actual usage, save for speculation/investing. Any normal currency has hundreds of millions of contracts attached to it (starting from short term offers on groceries in your local shop). Each of those contracts is a volatility dampener. Saying that Bitcoin is not used because it's volatile it's like saying that x=y because x=y.

And for thousands of years the world languished in poverty. The modern age as we know it with industrialisation and trade started with the Renaissance and boomed with the move away from the gold standard because it meant countries has a way to actually manage their monetary policy against things that mattered.

The move away from gold is still an ongoing experiment. I wouldn't say it's superior or proven at this point.

Philisophically or sociologically or ecologically, fiat money may be bad, but economically it's a clear winner.

It's prone to boom and bust which has been devastating. Hayek describes a type of money that adjusts it's supply to maintain a stable price. Until now this wasn't technically possible. Ampleforth.org is an interesting experiment to introduce a new base reserve with dynamic supply and eventually a stable price. https://m.youtube.com/watch?v=9-uo-KfnkhI

or it's non-vc fork - https://based.money/!

Economies boom and bust. This has nothing to do with fiat currency, and is a heck of lot better then the alternative where shopkeepers and employees are made poorer due to economic prosperity because they don't adjust their prices fast enough.

The most popular fiat currency, the US dollar, was tied to gold until 1971. It's still not clear that breaking that link was a good move.

Also this: https://wtfhappenedin1971.com/

"Need I remind you that the world has been running almost exclusively on gold,"

Actually that is not true. Gold by weight as a currency has been used at times, but many other forms of currency were used historically even by people who had gold available to them. There is a lot of historical precedent for credit money (i.e. people using debts owed to them as currency) and for coins minted with non-gold metals like iron and bronze. The earliest known currencies were "virtual," taking the form of clay tokens that were used for accounting in the ancient near east -- a civilization that was well aware of gold but considered it to be more useful for producing ceremonial objects. Shortly after inventing paper the Chinese started using paper money.

Gold is actually a terrible currency that makes trade much less efficient. Historically gold was most useful as a currency when empires were able to procure a growing supply of the metal, and when the gold stopped coming in people would switch to some other currency (typically some form of credit money).

Yeah I agree with the first paragraph. I wrote "deeply flexible", that is ultimately not redeemable by gold. Credit is okay with me.

Why do you think the second paragraph is true?

Gold has been disconnected from currencies only since 1971, and this detachment clearly has had significant impact: https://wtfhappenedin1971.com/

Even if you are only talking about the United States, 1971 was not the first time the country left the gold standard:

https://en.wikipedia.org/wiki/Demand_Note#Suspension_of_spec...

https://en.wikipedia.org/wiki/History_of_the_United_States_d...

Historically the pattern has generally been for a metal standard to be introduced only to be abandoned when the state is unable to procure more of the metal. The Romans abandoned their silver standard and started debasing their coins shortly after the empire reached its greatest extent, almost certainly because they could not find enough silver to keep the system going (though nobody bothered to write this detail down). In ancient China various dynasties are known to have started issuing iron and bronze coins when they could not find enough gold/silver/copper to meet their monetary needs (and when the weight of coins became impractical they issued paper money).

There is no question that using weights of gold as a currency makes trade less efficient. Most merchants and most consumers do not have the equipment or expertise needed to evaluate whether or not a given weight is pure gold, and having to pay someone to evaluate a sample amounts to a tax on every transaction. The inability for a central bank to adjust the supply of money in response to changing economic conditions actually led to greater price instability when the gold standard was in place (deflation during a banking crisis). It is economically inefficient to pay people to guard vaults filled with gold bars that are never going to do anything but collect dust. Leaving the gold standard was the right thing to do every time it happened, and going back to it was in every case the wrong thing to do (motivated more by alchemy and tradition than by any serious economic considerations).

Well, there are decentralized stablecoins on Ethereum, like DAI.

Your comment is wrong all around. Volatility doesn't prevent layer 2 from working, and it is growing. [0]

[0] https://defipulse.com/lightning-network

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