Wednesday, December 4, 2013

Bitcoin Could Destroy the Dollar- Ron Paul

Excerpted from CNN

There will be alternatives to the dollar, and this might be one of them," said former U.S. congressman Ron Paul. If people start using bitcoins en masse, "it'll go down in history as the destroyer of the dollar," Paul added.

But don't expect governments and banks to let Bitcoin take over so easily. Financial institutions will lose business if people stop using their payment systems, and central banks like the U.S. Federal Reserve would lose their ability to help slow and speed up economic activity. Paul expects banks to lobby and authorities to crack down.

"Governments absolutely demand a monopoly on money and credit. They're not going to give it up easily," Paul warned. "They will come down hard."

In a few sentences, Dr. Paul encapsulated the many nuances of the Bitcoin movement, and most pointedly alludes to a very likely event of the digital currencies rise, a government crackdown. However considering that the technological infrastructure is an open source code freely available, the cat is out of bag and putting it back may be increasingly hard if not impossible. Although it is my belief that Bitcoin is more of a speculative bubble versus a real competitive currency at this point........ the chart just screams bubble in my opinion......

and that its credibility as a currency will likely be tarnished once the speculative fever escapes, I also think you should consider that the technological architecture puts in play a real possibility of not one alternative competitive currency, but many competitive currencies. And isn't competition at the heart of capitalism?

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