Bitcoin is further away from being The numeraire; not only is it simply a number, much as Fiat… but its worth is measured in Fiat! Even if Bitcoin becomes internationally recognized as a medium of exchange, and even if it succeeds to replace the Dollar as the approved ‘numeraire’, it can not have an intrinsic measure like Gold has. Gold is exceptional in being measured by a true, unchanging physical quantity. Gold is exceptional in storing worth for thousands of years. Nothing else in reach of humankind has this exceptional blend of attributes.
In Summary, while Bitcoin has Some advantages over Fiat, specifically anonymity and decentralization, it fails in its promise to being cash. Its advantages are also questionable; the aim is to restrict the ‘mining’ of Bitcoins to 26,000,000 units; that is the ‘mining’ algorithm gets harder and harder to fix, then impossible following the 26 million Bitcoins are mined. Unfortunately, this announcement might well be the death knell of Bitcoin; already, a few central banks have announced that Bitcoins may become a ‘reservable’ currency.
Wow, sounds like a Significant measure for Bitcoin, does it not? After all, the ‘big banks’ seem to be accepting the legitimate value of the Bitcoin, no? This really means is banks recognize that they could exchange Fiat to get Bitcoins… and also to actually buy up the 26 million Bitcoins projected would cost a meagre 26 Billion Fiat Dollars. Twenty six billion Dollars isn’t even small change to the Fiat printers; it’s about a week’s worth of printing from the US Fed alone. And, once the Bitcoins bought up and locked up at the Fed’s ‘wallet’… what useful purpose would they serve? We are offering you solid pieces of advice here, but do be aware that some are more critical to understanding bitcoin revolution richard branson. What is more critical for you may be much less so for others, so you have to think about your unique conditions. Yet you do realize there is much more to be found out about this. Yet have more big pieces of the total picture to offer to you, though. Even following what is next, we will not stop there because the very best is but to come.
There would be no Bitcoins left Circulation; an ideal corner. If there are no Bitcoins in circulation, how on Earth could they be used as a medium of exchange? And, what would the issuers of Bitcoin potentially do to defend against such a fate? Change the algorithm and increase the 26 million to… 52 million? To 104 million? Combine the Fiat print parade? But , from the quantity theory of money, Bitcoin would start to lose value, just as Fiat allegedly loses value throughout ‘over-printing’…
We come into the main issue; why hunt For a ‘new money’ when we already have the very best money, Gold? Fear of Gold confiscation? Lack of anonymity in the intrusive government? Brutal taxation? Fiat money legal tender laws? Each the above. The answer isn’t in a new sort of money, but at a new social structure, one without Fiat, with no Government spying, without drones and swat teams… with no IRS, border guards, TSA thugs… on and on. A huge liberty not tyranny. Once this is accomplished, Gold will resume its early and vital role as fair money… and not a minute before.
Rudy J. Fritsch was born in Hungary In 1947, and fled Socialist tyranny during the Hungarian Revolution of 1956. His family had lived through WWII and the consequent Hungarian hyperinflation, thus he’s intimate encounter with financial devastation.
As an engineer and engineer, he Ran a thriving family business in Canada for years, at its peak employing over 100 workers, until economic upheaval ruined the profitability of North American manufacturing. Driven out of business, he chose to study economics… to discover the origin of the unhappy circumstance.
The halving takes effect when the Number of ‘Bitcoins’ given to miners following their successful development of the new block is cut in half. Therefore, this phenomenon will cut the given ‘Bitcoins’ out of 25 coins to 12.5. It’s not a new thing, however , it does have an enduring impact and it isn’t yet known if it’s good or bad to ‘Bitcoin’.
People, who are not familiar with ‘Bitcoin’, typically inquire why will the Halving occur if the effects cannot be predicted. The solution is simple; it’s pre-established. To offset the issue of currency devaluation, ‘Bitcoin’ mining was designed in such a manner that a total of 21 million coins would ever be issued, which can be achieved by cutting down the reward given to miners in half each four decades. Therefore, it is a vital element of ‘Bitcoin’s presence and not a choice.