Aug 28, 18 / Lib 16, 02 07:59 UTC
Is Bitcoin the Death of Fiat Currency? ¶
Bitcoin is not competing with Visa or MasterCard. Bitcoin is competing with the Federal Reserve and the U.S. dollar," says Michael Goldstein, president of the Satoshi Nakamoto Institute and host of the Noded Bitcoin Podcast. His co-host and the institute's treasurer, Pierre Rochard, talk with Nick Gillespie about the meteoric rise of bitcoin, how it can become a viable currency despite volatility, and how it may well spell doom for central banks and the gods of Keynesianism.
The Satoshi Nakamoto Institute is a group devoted to promoting bitcoin and working through many of the theoretical and practical challenges for the world's best-known cryptocurrency. It's named after Satoshi Nakamoto, the pseudonym of a programmer or programmers who launched bitcoin in 2009, in what Nakamoto called "a peer-to-peer electronic cash system."
Bitcoin potentially offers at least two radical things to its users. First is a non-state-based currency, and second is a fully peer-to-peer accounting system in which every actor can verify all transactions virtually instantaneously. The program resides on the computers and servers of its users, decentralized in a manner straight out of a science fiction novel. Inspired by Milton Friedman's and other economists' theories of a noninflationary currency, there is a fixed number of bitcoin that will be mined out over time into computer space, thus limiting the ability of people to inflate or deflate its value, at least in theory. Having said that, bitcoin is in the news now because of its massive spike in cost. Once trading at pennies, it recently neared $20,000 per bitcoin.
Whatever its price, Goldstein and Rochard say that bitcoin is here to stay and that what they call "hyper-bitcoinization" is already well underway.