It's somewhat ironic that one of the big selling points of Bitcoin was decentralization. The thing that they failed to realize is the team also needs to be decentralized. For something like this to take off it needs to be a specification for a federated network with zero single points of failure, and not an actual codebase with a dedicated team.
> specification for a federated network with zero single points of failure
The problem is that some people want to change the specification (bigger blocks) and some want to keep the current specification. The block size is part of the specification or that it's only an implementation detail?
For me, it's not clear what a "specification for a federated networks" means
* One interpretation is that the specification is written in assembler and is the current official Bitcoin client, and any other client has to be 100% bug compatible with it. Nobody can change it ever.
* Another interpretation is that anyone can add a new version inside a general framework, and somehow the people decide which version to use. You need some kind of number identifier for each version, or to make it user friendly you can use a nickname. If the network is too general, you can include Bitcoin and Litecoin (and all the Altcoins) in it. The network is just Internet.
Both alternatives have "zero single points of failure". The problem is that people want something in between.
I imagine it would be closer to the 2nd of the two.
When I've thought about it, I come to the conclusion that the base specification needs to be so simple (with clear path for extensibility) that no one will disagree, and everyone can see that it's critical for an electronic currency to exist. Namely the ability to own it, and to exchange it.
Another thing is, I believe that in order for something like a global electronic currency to become universally accepted, without support from / cooperation with governments, there can be no center of power, and unfortunately structurally I can't imagine something like that could happen with a blockchain-based currency.
Don't get me wrong. I see the beauty / elegance of the blockchain, but I can't get my mind wrapped around the idea that everyone (or even a significant percentage of people) around the world will accept the idea that their currency is at the mercy of decisions being made by some relatively small group of people who basically answer to no one except in the sense that they'll always attempt to do popular things in order to prevent people from leaving their currency for another.
What do you mean? The only thing that matter is what application the users employ. The people who convince the most people to use their protocol/implementation "win" (or they have the strongest fork or whatever). I don't see where centralization enters into the equation?
Funny, a successful decentralized monetary system has existed for quite some time, being the oldest monetary system in existence and probably the one that will still be relevant in 1000 years from now ... Gold ;-)
In my mind the only useful trait of Bitcoin has been its decentralized nature. Take that away and I'd rather deal with USD, EUR and my local banking system, thank you very much.
That old problem has of course been addressed, e.g. by using things like gold certificates: https://en.wikipedia.org/wiki/Gold_certificate Which add their own set of problems, but at least you get a clear signal when they get repudiated.
Many crashes in the 1800s were about Banks issuing too many certificates for the amount of Gold that was actually stored in their vaults.
Gold Certificates are no different than credit cards or fractional reserve banking. The bank makes a promise without proving anything, and people are expected to trust the banks for things to work out.
And when the poop hits the fan, people look into the vaults and realize they've been fooled. Maybe the gold really was there, but has been loaned out to another bank (and the banks have gold certificates to another bank). And maybe _THAT_ other bank has been lying this whole time. Its your standard economic issues, too big to fail and all that.
I don't see how a gold standard would change any of this. Should the banks have issues, they will legally prevent bank runs by making it impossible to withdraw money.
Whether or not a bank is tied to the gold standard, this will occur.
> When, not if. I think this may be better than how fiat money "works", but obviously opinions vary.
No sarcastic "quotes" needed. We both know that both Gold Standard and Fiat Money works. The question is if anyone has actually studied the 1800s economy and honestly can tell me that it was better than the 1970s+ economy.
Bank runs a plenty, private persons losing their entire savings as banks folded. Etc. etc...
Bank runs a plenty, private persons losing their entire savings as banks folded.
The fixes for those have only a limited bearing on a gold standard, which, BTW, I have no interest in debating, don't know much about them.
It was institutions like the FDIC with its limited backstop of bank accounts, and during the recent crisis a backstop for non-interest bearing business transaction accounts (e.g. those used for payroll, accounts payable, etc.) that fixed those problems well enough. As far as I can see a gold standard would only be an issue if it would prevent the government from doing that, which is certainly possible, but would not be a direct or inevitable thing.
