According to some reports that most bitcoin mining are now in the US, Canada and China. Banning bitcoin now will force money into gold and other commodities, further driving up inflation.
American Economics Thread
- Thread starter Bernard
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They could actually solve the unused wind/solar capacities from Gansu.
I don't see banning bitcoin as having much effect on the price of gold or other commodities.
Plus by banning bitcoin, we should see bigger benefits globally from:
1. Less money laundering by criminals
2. Less electricity usage and therefore lower electricity costs overall
3. Bitcoin mining chips use up semiconductor production capacity. But now there is a global shortage of chips which is affecting production of cars, smartphones, computers, etc. That is a huge driver for inflation.
4. Fewer carbon emissions when processing transactions
I think banning bitcoin would be a huge boon for the global public good.
Remember that the only advantage of Bitcoin over a regular currency is that it is anonymous, which is a godsend for criminals and tax evasion
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I dont think bitcoin anonymity will be around for too long. Quantum computing is fast advancing and in a couple of years it could be able to crack the encryption.
However there still other methods to deny quantum cracking of the bitcoin code but it still remains how it will fare against real quantum computing versus just the theorytical quantum computer
That doesn't help when you can conduct Bitcoin-Cash transactions without any identity documents.
Because bitcoin has no central governing authority, there will always be places where you can do this.
The worst case is that you have to pay a 5-10% commission for this.
As far as im aware the anonymity is not because of the encryption. The anonymity comes from the fact that everybody can make a wallet address without attaching his or her personal information to it. What you do see is the on and off ramps into crypto being regulated, so if you want to buy or sell your crypto currencies you have to go through a Know your Customer process, which will link your bank account and ID card to a blockchain wallet address.
What quantum computing will do is let the group who first creates a capable quantum miner. Have bigger chance of finding the correct hash value. Because that is what bitcoin miner do is using the hashing rate of their mining equipment to find the correct value to secure the next set of entries in the block(this is from what I can recall). This why nations who are energy rich and sanctioned by the US to trade in dollars, can use their energy abundance to mine bitcoins and bypass sanctions because US cant authorize or censor bitcoin transactions.
My guess is that the west and other groups will create a whitelist of bitcoin wallets and bitcoin miners. So only crypto wallets that have been through a know your customer(KYC) process can sell and buy crypto currencies. The next step would be only state certified miners will be allowed to supply new coins into circulation. So the west can still sanction for lets say Russian, Chinese and Iranian minted bitcoins.
With chain analytics software they can pretty much trace your crypto currency history, and check if you don't do any illegal transactions.
But you can't effectively police the on and off ramps with Bitcoin.
It's designed to have no central policing authority or regulator.
So literally anyone can start mining or putting in transactions using the Bitcoin blockchain.
You actually can, to pay your bills and taxes you need fiat currencies, so if you don't have enough fiat currency to pay your bills, you need to sell your cryptos and use a on and off ramp like coinbase, binance etc.
Let take a past example the internet was also designed around no central policing authority or regulator, now in 2021 can't really say that anymore. Sure there are some options like tor network but if 99% of the group choose to life in the regulated box of the internet governments have already won. The same will happen with crypto.
People under estimate the knowledge and resources of a government institutions. The American security state pretty much regulates the western part of the internet. Analyzing Realtime blockchain information should be a walk in the park for them. So if they see a illegal transaction they can fine you in real time what are you going to do as a US citizen kill the cops/army that will come to get you?
Exactly if in the digital economy every item is electorinally sold and bitcoin is banned from used, then what value does it have?
If you cant pay your house rent/loan, groceries, physical goods, pay taxes, make any transactions online then why even hold bitcoin? By that point, you should better switch to holding a state approved cryptocoin or the digital Yuan so you could at least buy physical goods
Bitcoin and other crypto currencies have their uses and I do see it as a way to kill/deprive private banks of money.
It should also allow a whole new way to think about stocks and dividend. It makes buying fractional stocks that much easier, imaging being just average worker save that can spend only like $100 into stock. Take for example a stock like Tesla which is out of this persons reach at around $650 but with fractional stocks he actually could buy a fraction of a tesla stock and ride the upward or downward wave and see his $100 become $120 or go to $0.
Another scenario instead of being paid dividend every month or every quarter, they could stream the dividend payment every other day. Same with your salary they would stream it hourly or daily toward your wallet. The same with a savings account the could payout the interests daily/weekly or monthly.