Post Reply Is there going to be a real digital replacement to fiat currency?
27273 cr points
Send Message: Send PM GB Post
39 / Inside your compu...
Offline
Posted 10/28/16 , edited 10/28/16
Is digital currency going to propel itself out of the realm of science fiction and into the realm of general use?

As things look right now it looks to be "not really" because blockchains always have performance and scaling issues.

http://blog.deloitte.com.au/greendot/2016/05/05/blockchain-performance-sucks-not-problem/


Blockchain’s performance is determined by network performance, as it is the network that limits the number of transactions in a block (block size) and the time between blocks (dwell time). Networks don’t obey Moore’s law nor will their throughput increase exponentially. Bitcoin has also reached its current performance limits at around 1/10,000th of VISA’s transaction volume. Reaching VISA’s current volume involves creating a gigabyte-sized block every minute, which is clearly unattainable. And you still need to consider that VISA’s volume is a moving target.


It's only "not a problem" as it's being used right now because blockchain isn't being used in high volume.


The sweet spot for blockchain – and distributed ledgers – is low volume, high-value exchanges. There’s a lot of interesting problems to solve in this space, from tracking diamond provenance through contract attestation and so on. It’s just that the pie in the sky, blockchain-taking-over-the- entire-financial-system predictions are likely wrong.


So yeah, we're likely not going to do those sci-fi digimoney stuff any time soon until there's some kind of do-over where something better than blockchain is invented.
10620 cr points
Send Message: Send PM GB Post
Offline
Posted 10/28/16 , edited 10/28/16
Digital currency probably won't ever really take off, at least not for quite some time. Really, you need a situation where it is massively unfeasible to have real, physical fiat money. Where the expense of transporting it is more trouble than it's worth to actually move it around.
14468 cr points
Send Message: Send PM GB Post
26 / M / Houma
Offline
Posted 10/28/16 , edited 10/28/16
Ask yourself this. What are we really trading with electronic bank transactions? We are trading digital credits representative of paper money. Paper money was initially traded representative of commodity coinage which was initially traded to represent physical goods. (I skipped a few steps there for the sake of brevity, but the point is made)

We already accept these transactions as legitimate in the faith that they hold value. Forgery of those records would be punished the same as forgery of paper currency. Cryptocurrency may not be the future of fiat currency, but digital currency in general is already on it's way to being adopted.

Security, not scarcity is going to push it into the forefront.
Banned
17503 cr points
Send Message: Send PM GB Post
29 / M / B.C, Canada
Offline
Posted 10/28/16
I have always wondered exactly what a digital currency would be backed by. I mean current currencies are backed by nations and their gold reserves. And wouldn't a digital currency have to essentially be backed by every country on the planet , a universal dollar as it were. And if every single country instead has it's own digital currency how the hell is that any different then waving around colourful bits of paper.

Not to mention the security issues around digital currency being an entirely online thing. There are enough risks with the internet in my opinion without wholeheartedly throwing every single red cent I own in the thing.

And then there is the checks and balances of inflation, valuation, and usage.
27273 cr points
Send Message: Send PM GB Post
39 / Inside your compu...
Offline
Posted 10/28/16 , edited 10/28/16

GreatLordBalzak wrote:

Security, not scarcity is going to push it into the forefront.


Lot's of people poo-poo'ed cloud computing because of security concerns but here we are with cloud computing, so it'll happen sooner or later just like cloud computing. It's not going to happen until someone invents something not only better performing but foolproof, and that's tough.


Ranwolf wrote:

I have always wondered exactly what a digital currency would be backed by. I mean current currencies are backed by nations and their gold reserves. And wouldn't a digital currency have to essentially be backed by every country on the planet , a universal dollar as it were. And if every single country instead has it's own digital currency how the hell is that any different then waving around colourful bits of paper.

Not to mention the security issues around digital currency being an entirely online thing. There are enough risks with the internet in my opinion without wholeheartedly throwing every single red cent I own in the thing.

And then there is the checks and balances of inflation, valuation, and usage.


Backed by thin air and trust People are supposed to trust the integrity and verification of the blockchain once "value" has been inserted via burning compute cycles to "mine" the currency. It's this very process of giving the thing assurance of integrity that makes it perform sluggishly.

My objection to cryptocurrency is that it depends on a data connection. No connection, no money... Sure, there are "printed digital money" that could be converted back once there is a connection but I think they're silly.
48449 cr points
Send Message: Send PM GB Post
23 / M / AZ
Offline
Posted 10/28/16
About 11 years ago I was reading a book from the early 90's about how cash was gonna disappear by the year 2000.
19555 cr points
Send Message: Send PM GB Post
25 / M / NYC Metro Area
Offline
Posted 10/29/16 , edited 10/29/16

HuastecoOtaku wrote:

About 11 years ago I was reading a book from the early 90's about how cash was gonna disappear by the year 2000.


I hope it never does. A fully digital currency economy will make it easy for the government to move to negative interest rates and steal money out of all of our private bank accounts like its their personal slush fund. Right now, they can't do that because as soon as they try to we will all run on the banks and put our money into mattresses and walls which they obviously can no longer tax.
Digital currency may be convenient, but it does have its consequences.
18491 cr points
Send Message: Send PM GB Post
M / Los Angeles
Offline
Posted 10/29/16
Precious metal, ammo and food rations will always be trade worthy of trade when the shit hits the fan.
27273 cr points
Send Message: Send PM GB Post
39 / Inside your compu...
Offline
Posted 10/29/16 , edited 10/29/16

kevz_210 wrote:


HuastecoOtaku wrote:

About 11 years ago I was reading a book from the early 90's about how cash was gonna disappear by the year 2000.


I hope it never does. A fully digital currency economy will make it easy for the government to move to negative interest rates and steal money out of all of our private bank accounts like its their personal slush fund. Right now, they can't do that because as soon as they try to we will all run on the banks and put our money into mattresses and walls which they obviously can no longer tax.
Digital currency may be convenient, but it does have its consequences.


Wow, I never realized that. Governments and banks steal enough as it is already!


XxNaruTheNarcissistxX wrote:

Precious metal, ammo and food rations will always be trade worthy of trade when the shit hits the fan.


You must be logged in to post.