Bitcoin is farther away from being The numeraire; not only can it be a number, much as Fiat… but its worth is measured in Fiat! Even though Bitcoin becomes internationally accepted as a medium of trade, and even though it succeeds to replace the Dollar as the approved ‘numeraire’, it can not possess an intrinsic measure like Gold has. Gold is unique in being measured by a true, unchanging physical quantity. Gold is unique in storing worth for centuries. Nothing else in touch of humankind has this exceptional combination of attributes.
In Summary, while Bitcoin has Some advantages over Fiat, namely anonymity and decentralization, it fails in its claim to being money. Its advantages will also be questionable; the intent would be to restrict the ‘mining’ of Bitcoins to 26,000,000 units; that is the ‘mining’ algorithm makes harder and harder to fix, then hopeless after the 26 million Bitcoins are mined. Unfortunately, this announcement could very well be the death knell of Bitcoin; currently, a few central banks have declared that Bitcoins may become a ‘reservable’ currency.
Wow, sounds like a Significant step for Bitcoin, does it not? After all, the ‘large banks’ appear to be accepting the legitimate worth of this Bitcoin, no? This really means is banks recognize that they might exchange Fiat to get Bitcoins… and to really 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 by the US Fed alone. And, once the Bitcoins purchased and locked up at the Fed’s ‘wallet’… what practical purpose could they serve? The effects of bitcoin revolution richard branson, not only on you but many others, is a fact that has to be recognized. No one really can effectively address all the different situations that could arise with this particular topic. So we feel this is just an excellent time to take a break and assess what has just been covered. In light of all that is available, and there is a lot, then this is a perfect time to be reading this. As usual, we typically save the very finest for last.
There would be no Bitcoins left in Circulation; an ideal corner. If there aren’t any Bitcoins in circulation, how on Earth can they be applied as a medium of trade? And, what could the issuers of Bitcoin potentially do to defend against such a destiny? Change the algorithm and increase the 26 million to… 52 million? To 104 million? Combine the Fiat print parade? But , by the quantity theory of money, Bitcoin would begin to lose value, just as Fiat supposedly loses value throughout ‘over-printing’…
We come into the main dilemma; why hunt For a ‘new money’ when we already have the best money, Gold? Fear of Gold confiscation? Lack of anonymity in the intrusive government? Brutal taxation? Fiat money legal tender legislation? Each the above. The answer isn’t in a new sort of cash, but in 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 world of independence not tyranny. Once this is accomplished, Gold will resume its ancient and critical role as honest money… and not a minute before.
Rudy J. Fritsch was born in Hungary In 1947, also fled Socialist tyranny throughout the Hungarian Revolution of 1956. His family had lived through WWII and the consequent Hungarian hyperinflation, so he’s intimate encounter with financial destruction.
As an engineer and entrepreneur, he Conducted a successful family business in Canada for decades, in its peak employing over 100 workers, until economic upheaval destroyed the sustainability of North American production. Driven from business, he decided to study economics… to detect the origin of the unhappy circumstance.
The halving occurs when the Number of ‘Bitcoins’ awarded to miners after their successful development of this new block is cut in half. Therefore, this phenomenon will reduce the awarded ‘Bitcoins’ from 25 coins to 12.5. It is not a new thing, however it does have a lasting impact and it is not yet known whether it’s good or bad for ‘Bitcoin’.
People, who Aren’t familiar with ‘Bitcoin’, typically inquire why does the Halving occur if the consequences cannot be predicted. The solution is simple; it is pre-established. To counter the dilemma of currency devaluation, ‘Bitcoin’ mining was designed in such a manner that a total of 21 million coins would be issued, which is achieved by cutting down the reward given to miners in half every 4 decades. Thus, it’s an essential element of ‘Bitcoin’s existence and not a choice.