[Cryptography] Cryptocurrency Exchange without a trusted third party (Ron Garret

[Benjamin Kreuter]

On Sun, 2017-01-15 at 21:49 +0100, Dominik Zynis wrote:
> > 
> > It is worth noting, BTW, that the bitcoin block chain is *not* what
> provides security against theft.
> 
> Some consider inflation created by a TTP (i.e., a central bank) a
> form of theft.

In other words, some people disagree with mainstream economics, the
modern view of money, and the modern concept of banking.  I thought we
already knew that about a certain group of Bitcoin users?

Really though, Bitcoin should not be viewed as currency.  In practice
it is just another electronic payments system; most Bitcoin users have
no interest in receiving Bitcoin payments and will almost immediately
convert what they receive into some nation's currency.  It has been
years now and Bitcoin is mature enough that we can safely put to rest
any fantasy of Bitcoin as a currency.

Bitcoin is better viewed as a consensus system.  Consensus can be used
to keep banks in check -- in fact, I have been told by people working
in the banking industry that this is exactly what has banks interested
in block chains.  Of course, Bitcoin is a massive energy sink because
it is permissionless i.e. nobody has a fixed identity, but this is not
needed for consensus or for keeping banks honest.

As for electronic payments / currency, I have said for years that
Bitcoin solves a non-problem while ignoring real problems.  A real
problem in electronic payments is the lack of anonymity, which I would
say puts persecuted minorities at risk.  Also problematic is the lack
of offline electronic payments, which raises costs (infrastructure
requirements), puts persecuted minorities at risk (e.g. of having their
transactions blocked), and is less reliable and less efficient.  We
already know how to solve all these problems on paper, so now it is a
matter of engineering.  If we could just stop worrying so much about
the existence of a central bank...

-- Ben
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