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The idea that bitcoin or any other crypto will be a boon for the unbanked or the very poor of the world doesn’t stand up to cold logic. You need to buy in, with at least a computer or a smartphone and some capital. Bitcoin will be very popular, however, with the middle classes of mismanaged Latin American and African countries. Its development is also hindered by the problem that, for the moment, there’s very little you can actually buy with it, apart from cocaine or bitcoin T-shirts and baseball caps.

The state of cryptocurrencies is very much like the early Christian church. All the spin-offs from bitcoin claim to have a fragment of the true cross. Each coin has a crew of very clever, very motivated evangelists around it, who have intelligent, cogent arguments as to why Bitcoin Cash, Litecoin, Dash, Monero or Verge should succeed, and most importantly, that they truly represent the true vision of the messiah, Satoshi Nakamoto, who was seeking to create a financial paradise. The hostility that cryptocurrency faces from most of the financial establishment is easily matched by the hostility between the various schisms in crypto, which all insist they are more crypto than thou, and is particularly ironic since nearly all the major players started out together under the bitcoin banner. Shakespeare would have loved this material.

The Bitcoin Standard has a scholarly mantle, with tables and a bibliography, but nevertheless much of the text reads as a polemic, and occasionally Ammous veers into something like a gold bug rant when talking about central banks or the effects of monetary policy on modern history (and even on modern art). Ammous is also a bitcoin carnivore, a strand of bitcoiners who are convinced that the best diet is red meat, and who view lentil-pushers as the equivalent of fiat currencies. Preaching about diet always worries me.

The Bitcoin Standard will be a big hit with bitcoiners simply because it gives them entertaining ammunition for dinner parties and it’s telling them what they want to hear: that tomorrow belongs to them. My guess is that Ammous is mostly right about bitcoin. However, he’s extremely dismissive about the thousands of altcoins. I disagree with him on that. I’d guess that in ten years there will be one or two global altcoins that you can use effortlessly to buy coffee in Starbucks, but no more than one or two. There’s room for that, but no need, because however shitty fiat currencies are, they do work. On the other hand, don’t forget every time you buy some bitcoin, you make a banker cry.
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June 7th, 2018
8:06 AM
A call for another tulip mania?

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