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Comment by Ironchefpython | Hacker News Reader

> Typically dismissed by everyone

Yes, there's no bitcoin hype at all.

> it nevertheless solves universal problems related to something everyone uses -- money.

You know what is a simpler, more energy efficient, universally accepted, easier to use, time-tested, fungible, stable, and better in almost every way form of money is?

Money.

All the tulip mania or dotcom stocks or Florida swampland or whatever bubble fueled by something valueless without any underlying guarantees will never supplant actual money.

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I work on bitcoin, and am very involved in the community. Every single person I have interacted with, core developers included, dismissed bitcoin on first exposure, at least in the early days.

And I suggest that you sometime look into how national currencies work and the systemic risks involved. Bitcoin solves a real problem of trust and institutional moral corruption.

> Every single person I have interacted with, core developers included, dismissed bitcoin on first exposure, at least in the early days.

I was exactly the opposite. I was entranced by how cleverly the blockchain solved the n-party Byzantine Generals problem.

Then I realized the while bitcoin is a neat technical solution, it doesn't solve any real-world problems except committing crimes and fueling a bubble.

> Bitcoin solves a real problem of trust.

No, it doesn't.

For the vast majority of people on the planet, a stable fiat currency is more trusted and stable than e-tulips. Rational people trust banks more than they trust Mt. Gox.

Can you give me an example of a common situation where trust is lacking, where normal people would have been better off using bitcoin than say... VISA or Mastercard?

> Can you give me an example of a common situation where trust is lacking, where normal people would have been better off using bitcoin than say... VISA or Mastercard?

I guess that depends on whether you consider the 2+ billion people worldwide without access to payment networks like Visa or MasterCard "normal"...

I think the better question is whether cryptocurrencies are a better fit than existing options for those people.

> I guess that depends on whether you consider the 2+ billion people worldwide without access to payment networks like Visa or MasterCard "normal"...

how is bitcoin, a "currency" that fluctuates wildly in value, requires a decent computer (or modern smartphone) to hold a wallet, has very high transaction costs, and is incredibly easy to lose (though corrupted wallet, hacking, fraud, etc.) better than say... M-Pesa (https://en.wikipedia.org/wiki/M-Pesa) or PayTM (https://en.wikipedia.org/wiki/Paytm) which are widely accepted, runs on a cheap phone, has significantly lower transaction costs, and is significantly better at protecting individuals against fraud and hackers.

> I think the better question is whether cryptocurrencies are a better fit than existing options for those people.

Are they? Seriously, are they? I'm pretty sure the answer is no, (at least not the Bitcoin that exists today) but people who are bullish about the Bitcoin bubble keep trying to force that square peg of crypto-currencies in that round hole of micro-payments.

Sorry, I wasn't referring to Bitcoin in particular, I'm only referring to the underlying decentralized blockchain technologies themselves.

> consider the 2+ billion people worldwide without access to payment networks

Why is a blockchain a good solution for this problem? Operators like M-Pesa have made digital payments mainstream in underbanked Kenya, without any crypto. Seems like the hard problems involve cash-to-bit conversion, building up a network of users, and building trust. None of these are fixed by Bitcoin.

Venezuela.

> Venezuela.

Great example, if bitcoin suddenly developed magic powers that could unseat a dictator, write a new constitution, educate the electorate, and protect the rule of law.

Seriously though, two things.

One, Venezuela has significant problems that magically giving everyone a bitcoin wallet isn't going to solve.

And two, currently the biggest use of Bitcoin in Venezuela is to evade currency controls. Which is criminal activity. Which is one of the only two things Bitcoin has a usecase for (the other being speculation)

So yeah, while a lot of people might be better off if they engaged in criminal activity, you can't use Venezuela as an example of a legitimate use-case for bitcoin.

> currently the biggest use of Bitcoin in Venezuela is to evade currency controls

False, it's actually to mine bitcoin using some of the world's cheapest electricity, thanks to local subsidies.

Empirically, bitcoin hasn't reached anything close to mainstream adoption in Venezuela. Why do you think this is?

Have you seen the price of real estate in Florida? I'd say they did a pretty good job of making all that worthless swamp land pretty valuable.

This is Aladdin City, a heavily hyped and over-sold new city that fueled a real-estate bubble in the 1920s in Florida.

https://goo.gl/maps/Xe3ns9Cd2tv

You'd probably be hard pressed to find a home for less than $250K even there today. And I've seen more than a few wetlands filled in with dirt to build apartment complexes and neighborhoods on in Florida. To be fair, there are several huge over-sold neighborhoods in Florida that never met the hype, but for every one of them there are real success stories too.

My point is the majority of speculators lost most of their money in the short-term, and didn't live long enough to see the value of their investment appreciate, and for most people that would qualify as a failed investment.

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