Sometimes going back is the answer, sometimes we can solve things going forward with new technology. Look to see people start banning this within 18 months... http://launch.is/blog/l019-bitcoin-p2p-currency-the-most-dangerous-project-weve-ev.html Video discussion http://thisweekin.com/thisweekin-st...-and-amir-taaki-on-this-week-in-startups-140/
Some more information about how it works: https://en.bitcoin.it/wiki/FAQ and how it counters the deflationary spiral issue of fiat: https://en.bitcoin.it/wiki/Deflationary_spiral
It's interesting how they have basically made an electronic version of gold.... (not usefull for much, limited supply) It's interesting to see what is basically a bunch of mathematicians say that fiat currency doesn't work...
It appears on the surface to be backed only by expended CPU cycles. Digitally mined as it were. I don't know if it fits the criteria for money.
The idea is that to run the algorithm to generate the coins it will cost you more in electricity than they are worth, hence there is no way to generate lots of them and dump them on to the market. it's no different from fiat in that it's not backed by anything other than peoples belief, it is however relatively immune from the same kinds of manipulation that governments are currently so fond of...
and it is the ideal blackmarket currency if there is a single world currency with all its connotations and social controls. Lots of science fiction has similar concepts that allow rebels to leech from a central system. Eventually it becomes the currency used by the have nots and conduits between the haves and the have-nots keep the wheels of commerce grinding along. Isn't this a bit like Second Life money hitting the real world?
I came into this thread thinking "maybe some electronic banking for gold certificates or something :/" and then I read this. I'm glad someones decided to further explore how we can get out of all these cross-border payment fees beyond half-baked "e-money to money" ideas. But in my opinion: It's not anonymous enough. They gotta solve that problem first, even if people can change their "address" all the time. Only those that care will put in the extra effort to cover their tracks (as usual). Also, for ease-of use, they could have allowed larger numbers rather than limit the total to 21 million and rely on division to 8 decimal places. It would appear more natural to users to have trillions in the total pool and rely on 2 decimal places.
I agree with the viewpoint propounded on the deflationary spiral page. If there's a limit and the value keeps going up people will hoard them and there will be less to use in exchange. The currency needs to be flexible enough to increase when necessary if hoarding starts to happen.
