As of late, bitcoin has been making headlines across most business news outlets, mostly because of its tie to criminal activity. However, these illegal activities such as the sale of drug and money laundering have been around decades before bitcoin’s existence. Bitcoin doesn’t make criminals, criminals abuse bitcoin.
As the Federal Reserve turns 100 years old, bitcoin looks to solve economic hardship that banks labeled as “too big to fail”, can not. Congress continues to come up with solutions that have yet to exterminate this economic peril. Through bitcoin, many feel a solution can be brought to light.
Edward Felten on Bitcoin
Edward Felten is a bitcoin visionary. He explains that bitcoin’s decentralized nature is what makes it so unique. Felten understands that opposing views of bitcoin could either lead the digital currency to be an alternative to cash, or be the first steps towards some other type of new currency.
McArdle asked Felten how the world’s regulators see bitcoin. Felten replied by saying that the regulators are trying to sort it all out, as such a decision takes more than a few moments to ponder. Regulators are going to have to apply regulations that prevent illegal acts like money laundering activity, while simultaneously allowing the technology to grow and develop.
When asked about bitcoin’s attractiveness for investors, Felten gave the obvious answer:
“You’ll probably lose all your money, but you might make a lot.”
Later on, a caller claimed bitcoin was a scam. In defense of the digital currency, Felten explained how the system wouldn’t allow for toxic control over transactions. The bitcoin system is essentially rob-proof. The BlockChain prevents any transactions from going unnoticed.
Felten added that the value of bitcoin depends on how valuable the people make it, and that this is true with any form of money. A dollar bill is only valued because society has deemed it in that regard.
Bitcoin can very well be the answer the economy needs to get out of its overstayed funk. We will never truly know this until regulators get on board with the concept and let bitcoin show what it is capable of. Critics may be in for a surprise if bitcoin is allowed a fair chance for society to embrace it.
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Edward Felten Photo.