So what makes money have value? A lot of people think its value is imaginary, but I see it as having cultural value. The dollar is worth something
because people use it to buy and sell things. The more factories, individuals, talent, resources, etc. that are represented by the dollar are what
determines its value.
As people sell the dollar to buy cryptocurrencies, eventually, we should see the value of the dollar drop as fewer and fewer factories, individuals,
talent, and resources tie their value into the dollar and go with cryptocurrencies instead.
Think of it as the same way a religion gets power, from its followers.
Who owns cryptocurrencies? The internet? What advantages do they have? Well, if every person and thing eventually developed its own coin, exchanges
could let you invest the money you usually let sit in banks directly into projects or people you want to see succeed, or you could let it sit in a
safer, less volatile coin where it would still increase in value.
How come? There are more advantages to cryptocurrencies, for example, they can be set up to be secure, have nearly instant transaction times, and
allow you to store your money elsewhere besides in banks.
What does this mean? First of all, money not being stored in banks means that bankers will go bankrupt because no one will store their money with them
anymore. Normally, the bankers are the ones who invest your money in projects they want to see improved.
These benefits will work together to see that more and more people start switching to digital currencies. This will bring up a double-edged sword:
people will soon figure out that this brings the added bonus of people who get involved first seeing huge percentage gains on their initial
How long will it take the word to get out that the first ones in are going to be ridiculously rich? Once we reach this breaking point, there could be
a mad rush for cryptocurrency as everyone else figures out that their cash is going to be worthless.
Basically, the internet would be in control of the wealth, not the bankers or the elite, or even holders of cash. So, America is not on the gold
standard anymore? Well, that means that there would be nothing legitimate to back up the value of the paper dollar. Right now, although people think
its value is a "magical attribute," it is, as I said, based on how many goods and services and how much talent is linked to the dollar.
At the moment, cryptocurrencies will continue to go up in value as long as there are more opportunities to buy and sell with them, for example, as
more governments accept them, companies accept them, etc. It should naturally progress towards more entities accepting cryptocurrencies over time.
So, if the elite figure this out, are they going to try and regulate cryptocurrencies? I mean, it even seems to me like they should regulate them a
bit, such as monitoring its use in criminal transactions and including gains in taxes.
I'm sure there are several solutions that could be implemented to ease the bumpy transition from fiat to crypto. One solution could be to have a Fed
Coin. There could be others.
It seems to me like the feds could outlaw the use of coins that are not tied to a nation. After all, this is the transfer of wealth from sovereign
nations to the internet, a nationless state.
I think that there is going to be a revolution if cryptocurrencies use decentralization to eliminate the need for a ruling class that eats up money
through corruption. However, it could potentially generate a new breed of elite, early backers that would see their assets get multiplied by millions
and become wealthier than anyone in recorded history.
It would also leave the elite out of a job, and out of money - the old-fashioned elite might even scoff at the idea of investing in cryptocurrencies
and instead of investing in them, try to stop them with laws. If the laws did not work, then the dollar could become worthless overnight, it could
potentially get to the point where the government doesn't have enough "value" in money to pay its military.
What's worse, people are FDIC insured for around $250,000 if something were to happen to their bank accounts. Okay, the money isn't worth anything
anymore. Can I have my $250,000? Sorry, still not worth anything. And what is the government going to use to back up the value of its currency?
Nothing, because there is no gold standard, and because the cultural value that had been stored in USD has migrated into cryptos. That destroys the
government's legitimacy, which could mean civil unrest and even the possibility for invasion by a country wishing to take advantage of a weakened
Just some thoughts.
edit on 06amSat, 06 Jan 2018 01:18:15 -0600kbamkAmerica/Chicago by darkbake because: (no reason given)