[Cryptography] On Security Architecture, The Panopticon, And "The Law"

[James A. Donald]

John Kelsey wrote:
 > Distinguish the different uses of bitcoins.  For buying things
 > online, yeah, there's a demand for bitcoins based on wanting to be
 > able to do online transactions.  To the extent there are
 > transactions that lots of people prefer to do in bitcoins (whether
 > legal or illegal), there will be a certain amount of demand for
 > bitcoins based simply on how many bitcoins are either involved in a
 > transaction right now, or are being held ready to be used for a
 > transaction soon.  But bitcoins are online, and their volatility
 > makes them an awful store of value.  (They can be a speculative
 > investment, but they aren't where you'd want to park your retirement
 > fund on your 60th birthday.) They're too volatile to be a good unit
 > to price things in, too.

But if one has retirement funds denominated in dollars, one is exposed
to a considerable risk that these might go to zero.

In the event that dollars go to zero, either gold or bitcoins will go
up, gold by a little, bitcoins by a lot.

Therefore to reduce the risk of being poor in the midst of a terrible
crisis, should diversify some dollar denominated assets into gold and
bitcoins.