1. Open bitcoin bank
2. Receive deposits
3. Claim you have been hacked
4. Run off with everyone's money
NB I think I'll re-read Halting State:
Many fierce proponents of Bitcoins are the anarchy-leaning libertarians. Its appeal is that government agencies can't track and tax it (or have a tougher time with it)
While I do think a crime has occurred, it feels a bit like collecting a benefit you refused to pay into.
http://www.hmrc.gov.uk/briefs/vat/brief0914.htm
If the government regards something as having value it wouldn't seem unreasonable to expect them to regard theft of assets in this form to be a crime.
I've just smiled to myself picturing those guys coming together and then slowly re-learning everything we know about statesmanship and politics. Like the moment they first realize different people have different values and want different things. Then they're going to come up with the idea of democracy and a parliament. Only this time around it will be the Aspergers among us who try to figure out how to influence people. :)
But, of course, the best bit will be when they, so rationally, decide to give up the final ruling power to a super-intelligent AI, and then the look on their faces when the AI decides to do something that, while 100% rational, nobody wants.
Besides, isn't lack of effective prosecution of failed financial institutions a reason often cited for using bitcoin?
The difference is that Bitconin is decentralized, so there in no equivalent of A.A. to handle the servers. But it's easy to understand that a number in a computer screen is valuable. Well, most of the dollars are only a number in a computer screen, not real life bills.
Can you give me a list of all the people who have been criminally investigated and put in jail for such theft?
10. Eventually price goes back up, as it _always_ does.
11. ????
12. Profit
So my tulip investments are safe after all? That's certainly a load off my mind.
I know people keep making the comparison between bitcoin & tulips. I still don't understand why. I do understand that there is a lot of speculation driving bitcoin prices up & down right now and I also understand that BTC is experimental tech where the chance of a random disastrous event killing the whole thing is possible(like almost anything else that is new), but I also think that bitcoin, its protocol & services built around it can't be compared to a flower.
The Dutch believed tulip bulbs had value because the new breeds of tulips were beautifully designed and growing them took effort, which gave each bulb some kind of intrinsic value in terms of expended energy.
(Assuming infinite parallel universes, there's bound to be a universe where each bitcoin is the genetic code for an awe-inspiring dragon... But that's not where we live.)
The value in those bits is a cultural intangible: someone you trust tells you that there's a value beyond the practical level. This is like an invisible piece of metadata attached to the seemingly useless information.
It's the same reason why a vintage Gucci bag costs $2000 even though you can get a used leather bag for $5... Or why an Andy Warhol canvas with a dollar sign on it costs $20 million, and one painted by me can't be sold at any price.
There is no inherit reason for the transaction volume of tulips to stay strong after a burst bubble, because they have no special practical ability. Whereas cryptocurrencies generally have a practical application, like fiat, that makes people want to keep making transactions with them, even after a bubble. The practical application of Bitcoin is its low fees and ease of use for person to person international transfers.