so why have central banks at all if all they do is value target Bitcoin? just hold Bitcoin. Why risk their mismanagement in targeting X when you can just hold X?
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Also, once bitcoin stops deflating so rapidly, people will want a way to loan out their bits for an interest rate. I don't wanna search for/screen debtors and then try to collect when they dont pay. Banks are already set up to manage that. Custodian accounts have many benefits.
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I think some Banks will survive + have new Bitcoin banks. Argument was whether we need “Central” banks
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World has existed without central banks before, so that seems like a possible scenario. If they choose to adapt with a peg, they would have to do a series of major devaluations. There will always be people who want to sidestep the banks completely. But not everyone.
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Obviously if they no longer have a monopoly on money their role changes. What my contention is, is that central banks, facing a hyperbitcoinization crisis, can choose to value stabilize in unison versus bitcoin, curbing its deflationary properties to what is handable.
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Sure. Personally I think transacting directly with btc is superior, provided it can handle the throughput, but not everyone will want to take that responsibility/burden. The ? is what % uses BTC directly and what % uses fiat peg. 80/20 perhaps? (Fiat/BTC)
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why have Fiat peg if we can have Lightning or even centralized solutions built on top of BTC like Square Cash etc.
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Yes I'm starting to think that's where the game theory leads as well. Why would a bank choose to just roll over and die? You really think 80% of the population is gonna go learn cybersecurity and everything else? Transition looks real messy though... Will pop lots of bubbles.
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If 2 million people are playing World of Warcraft and use digital gold there don’t see why others can’t either. In Africa they already use money via Android phones + UX will improve a lot
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Is he really proposing that you hold one asset versus another? Or is he proposing that state fiat pegged to bitcoin is a likelihood, and provides a similar net impact as hyperbitcoinization in the purest sense?
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I think your missing the argument he's making
@MustStopMurad He's talking macro economic impacts, and your talking about individual asset preference. -
If we have the premise that the value trends are the same, we cannot then say "but people will prefer one over the other" That the value trends are the same is an indication of equal preference.
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So 50/50 you think? Personally I can't see more then 20% of the population choosing to use BTC directly. But 20% of the population doesn't necessarily mean 20% of the value. 50% of the monetary value could be absorbed by BTC while only 20% of the people are using it directly.
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In 50 years, its possible that majority of population will be tech-savvy enough to use BTC directly. Strong monetary incentive to use it to avoid taxes/government friction. Many businesses are simply too large to transact under the table, but scale of enterprise is declining.
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If bitcoin absorbs 50% of the monetary value, central banks will then stabilize against bitcoin, which in effect results in full indirect hyperbitcoinization.
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why hold fiat pegged to Bitcoin if you can just hold Bitcoin instead? there is a rainbow of technological advantages and utilities that holding Bitcoin directly enables that this pegged Fiat probably will not
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