Who knows what she would think about it, but certainly it’s possible to both believe BTC isn’t money, but at the same time it has its appeal to customers as a way to transfer money quickly and anonymously and outside of the financial system. For these advantages, it’s possible she might have hailed it as a great innovation.
Pros:
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a predictable money supply; more predictable than even gold.
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politically, it might be less feasible to impose abusive government regulations, due to the fact that any meaningful regulation would require international agreement between many nations. But, if it grows large enough, politicians will find a way to agree on some controls, not to mention taxes.
Cons:
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small size of the money supply makes the value of bitcoins easy to manipulate
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it’s vulnerable to hacking (for purposes of theft or fraud); more so than fiat currency transactions, and certainly more so than gold transactions
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it’s probably anonymous right now, but that’s only because government agencies haven’t taken enough of an interest; but, if any government wished to, they could start collecting information on transactions, same as they do on bank transactions
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same with confiscation: it’s just as easy to confiscate as electronic fiat currency, and easier to confiscate than cash or gold; it isn’t being confiscated right now, because it doesn’t have enough value to draw the attention of governments;
I’d be most worried about the hacking potential. All it takes is one news story that a large hacking attack has taken place, and people will sell like crazy, sending the price plummeting.
Also, it looks like bitcoins are experiencing quite a bubble right now:
Rand knew very little about economics, finance and investing and never claimed otherwise. She was a very conservative investor herself. Thus I doubt that she’d have much to say one way or another on the question except maybe “ask an expert.”
I know she wouldn’t have a problem with the idea of an alternative currency, and keeping issues related to the field of computer science out of it, it seems that the particular medium is irrelevant as long as people choose it voluntarily.
I know she wouldn’t have a problem with the idea of an alternative currency, and keeping issues related to the field of computer science out of it, it seems that the particular medium is irrelevant as long as people choose it voluntarily.
She’d surely have defended the right of people to use bitcoins voluntarily. Given her economic commentary she would probably have thought money must be something of value in itself. So, I doubt she’d have liked bitcoins, even while she would agree that other folk could do what they felt like in this area, since it did not violate anyone else’s rights.
I’d be most worried about the hacking potential. All it takes is one news story that a large hacking attack has taken place, and people will sell like crazy, sending the price plummeting.
That would make some investors very happy, because we would buy like crazy before the prices recovered.
That would make some investors very happy, because we would buy like crazy before the prices recovered.
Yes. And the same people that are hacking will be the ones selling before the attack, as well as the ones buying at the bottom. At some point, I suspect the frequency or the severity of the hacking will dissuade average investors from even getting involved in online currencies. It is mostly a speculative game.
Rand would have the same opinion as most people: complete bafflement and no opinion to offer.
One might as well ask what would Socrates think of Bitcoin?
I would say this about Bitcoin: every technology that has filled the “niche” of providing a venue for illegal transactions has failed.
Years ago we had “peer to peer” and many people hailed it as a technological marvel, while a handful of experts understood that something called a “hierarchical caching scheme” was technically superior, and is what drives the whole Internet already. Technical shortcomings notwithstanding, “peer to peer” lasted as a mainstream buzzword for several years, but it slowly oozed back to the underground from which it came. There’s just not much of a (paid) market for enabling illegal activity.
Every time I ask the “why” question about Bitcoin, the answer is always some form of, “you can do illegal stuff with it and not get caught”. That’s the Bitcoin “secret sauce”–take that away, and it has no advantage over Paypal, and tons of disadvantages.
Insofar as it catches on, governments will fix the “bug” in Bitcoin, and Bitcoin will be left with no useful value whatsoever.
As to the OP’s question, Ayn Rand would know nothing about any of this and as such would not offer any opinion…
Years ago we had “peer to peer” and many people hailed it as a technological marvel, while a handful of experts understood that something called a “hierarchical caching scheme” was technically superior, and is what drives the whole Internet already.
Three points:
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to claim that hierarchical caching is what drives the Internet is about as informed as claiming that FoxNews drives gold prices.
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P2P and hierarchical caching are not antithetical in any way; if you think they are you have no idea what one or both actually are;
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P2P network speeds are far, far better than those of most online content providers. The reason why the technology isn’t used is because it is being purposefully blocked by ISPs, not because it doesn’t work.
Three points:
to claim that hierarchical caching is what drives the Internet is about as informed as claiming that FoxNews drives gold prices.
P2P and hierarchical caching are not antithetical in any way; if you think they are you have no idea what one or both actually are;
P2P network speeds are far, far better than those of most online content providers. The reason why the technology isn’t used is because it is being purposefully blocked by ISPs, not because it doesn’t work.
This isn’t a technology forum so I won’t take it off-topic. I’ll leave it to others to do their own research on this (somewhat arcane) topic. It wasn’t my core point, either, so what you are seeing is both lying on the part of Nicky here (in terms of misrepresenting my views) as well as a dickish pedantry.
This isn’t a technology forum so I won’t take it off-topic. I’ll leave it to others to do their own research on this (somewhat arcane) topic. It wasn’t my core point, either, so what you are seeing is both lying on the part of Nicky here (in terms of misrepresenting my views) as well as a dickish pedantry.
I didn’t misrepresent anything. Just name what you claim I misrepresented, and I’ll provide direct quotes of you saying it. But you’re right, I am mocking you. You can’t be taken seriously. Not when you claim that hierarchical cashing drives the Internet. Or when you claim that Bitcoin is just used by criminals.
Stop lying, Nicky. Thanks.
- it’s probably anonymous right now, but that’s only because government agencies haven’t taken enough of an interest; but, if any government wished to, they could start collecting information on transactions, same as they do on bank transactions
And here it is, they US has taken that interest I mentioned, Americans can no longer trade bitcoins anonymously.
http://online.wsj.com/article/SB10001424127887323582904578485391717441224.html
By JEFFREY SPARSHOTT And ROBIN SIDEL
WASHINGTON—U.S. officials dealt a blow to the fledgling digital currency called Bitcoin, freezing an account tied to the largest Bitcoin exchange just months after regulators warned such entities should follow traditional anti-money laundering rules.
U.S. officials dealt a blow to the fledgling digital currency called Bitcoin, freezing an account that is tied to the largest Bitcoin exchange just months after regulators warned that such entities should follow traditional rules on money laundering. Jeffrey Sparshott joins digits. Photo: Getty Images.
The Department of Homeland Security obtained a warrant Tuesday to seize an account tied to Mt. Gox, a Tokyo-based exchange that says it handles 80% of all Bitcoin trading. The warrant alleges the company and a subsidiary were conducting transactions “as part of an unlicensed money service business.”
Bitcoin startups are beginning to raise sizable investment capital even as industry leaders warn that hackers are abusing the Internet virtual currency for profit. Spencer Ante reports. Photo: Getty Images.
The scrutiny comes after the Treasury Department ruled in March that firms issuing or exchanging online cash, including currencies not backed by a central bank, would be subject to the same money-laundering rules as traditional providers like Western Union Co. WU +0.37%
The Treasury unit that fights money laundering requires such companies to register as “money services businesses,” and subjects them to a variety of rules and reporting for transactions of more than $10,000. The Commodity Futures Trading Commission also is considering whether to regulate so-called virtual currencies.
U.S. authorities accused Mt. Gox and its U.S. subsidiary, Mutum Sigillum LLC, which held the account, of failing to register with the Treasury’s Financial Crimes Enforcement Network, or FinCen. The account was held at the online-payments firm Dwolla, according to the warrant.
A number of firms have registered as money-transmission businesses since the agency issued the guidance, but Mt. Gox hasn’t done so, according to a FinCen list. The agency doesn’t have authority to take on Mt. Gox directly because it is based in Tokyo, but has fired a shot across the exchange’s bow by going after its U.S. subsidiary.
The DHS action appears to be the first salvo in government efforts to make sure companies comply with anti-money-laundering rules, said Jon Matonis, a director of the Bitcoin Foundation, an industry-backed group that works to promote the digital cash.
Nicole Navas, a spokeswoman for DHS’s Immigration and Customs Enforcement arm, said the account seizure was the first such move “involving virtual currency in the agency’s history.”
Dwolla, based in Des Moines, Iowa, said it had informed users. “We appreciate the sensitivity and frustration caused by the situation,” but the company considers the matter between Mt. Gox and the DHS, said a spokesman.
Mt. Gox couldn’t be reached for comment. A statement on its website said the company had “read on the Internet” about the warrant.
The rising popularity of virtual currencies is being fueled by Internet merchants, as well as users’ concerns about privacy, jitters about traditional currencies in Europe and efforts to move money for illicit purposes.
Bitcoin has been on a wild ride since March, ranging between $125 and $98 over the past 10 days and rising as high as $230 in April. It was trading at about $112 Wednesday on the Mt. Gox exchange.
Americans can no longer trade bitcoins anonymously.
Not true, Bitcoins are as anonymous as ever. The U.S. govt is acting upon Mutum Sigillum because it acts in the capacity of a dollar transfer agent, not because it transfers bitcoins (which it doesn’t do).
Yep, and like every technology like this that comes along and says, “hey look, I can operate outside of the law!”, the government comes in as says, “yeah, right”. The US government wasn’t born yesterday.
I remember when Napster allowed people to download any bit of musical intellectual property anybody wanted at anytime, seamlessly and for free. It was the absolute end of intellectual property. Until it wasn’t.
Yep, and like every technology like this that comes along and says, “hey look, I can operate outside of the law!”, the government comes in as says, “yeah, right”. The US government wasn’t born yesterday.
I remember when Napster allowed people to download any bit of musical intellectual property anybody wanted at anytime, seamlessly and for free. It was the absolute end of intellectual property. Until it wasn’t.
What are you talking about?
Newsweeks says they have found the elusive Satoshi Nakamoto, who created BitCoin.