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Get your vote in now!!
(lemmy.world)
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this post was submitted on 02 Jun 2024
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The problem is that, as something that is used first and foremost as a speculation vehicle, crypto can't really be a true currency replacement. The amount of deflation, and instability, crypto see, due to the design, basically prevents it from ever being a true replacement for contemporary money.
Now, having a block chain credit system that's availability is not derived in the way that current crypto is could very well be one. Just not what we are being offered now.
Its been increasingly popular among the unbanked, as it grants a lot of the functions of the modern financial system at a marginally lower cost than check cashing companies and payday lenders without requiring the participant to be considered "credit worthy" by the transacting institution.
You can have a digital wallet and make digital transactions and you don't need to carry a giant wade of cash on you all the time, even if a traditional financial institution wouldn't touch you. That's a boon for crooks, sure. Its also a boon for people working in the gray market - migrant laborers sending money home to family, state-legal pot/mushroom dealers who don't have federal sanction and can't use normal banks, gig workers and other contractors, international workers and businesses needing a universal currency to trade against. And its a boon for the working poor, particularly folks who don't have a physical bank nearby.
Because the currency has material benefits for the unbanked (and therefore legally vulnerable) population, it becomes a popular place to ply scams and grifts and other dirty financial tricks precisely because you know the people you're fleecing will have no legal recourse after the fact. But that's the parasitic nature of second class citizenship.
You're not vulnerable because you're using crypto nearly so much as you're vulnerable because you're denied access to traditional banks and courts.
I am aware of this, still doesn't make it a viable replacement for traditional currency
Not for someone with access to the traditional banking sector, no. But for those locked out, it's the only available alternative.
It is only good for that at a limited scale. The issue is that it's adoption will be stymied, governments not wanting to give up hold to their influence over currency, or not, by the simple fact that it is either in a near constant state of deflation, or it gets abandoned by the broad market. There will have to be one implemented that has it's scarcity regulated in such a way that it retains a mostly gradual inflation. The way their scarcity is currently designed it essentially forces the currency value to increase significantly, without huge periods without value growth, or it gets dumped.
A block chain, crypto, that holds a relatively steady value, in a similar manner to normal currency, is what will be needed for it to truly take off as a full market replacement.
That's just a Stablecoin, like Tether. Unfortunately, stablecoins have a rather tawdry history as ponzi schemes. Terra/Luna being a classic example.
Yes, I am also aware of this. The execution of an anonymous currency was done so poorly, for something trying to be an actual currency alternative, that is set having something like it back decades, if it didn't kill the idea of a currency that a country didn't control.
Has it set stablecoins back? Their market share would suggest otherwise.
I think they have badly damaged the image of the idea of crypto entirely. Of course it has its cultists, then its fanboys, but most people who know about think it is a good idea with a bad execution that got latched on to by the worst type of people, in terms of promoting it, the scammers.
Remember, we need market share growth vs traditional currency. That will be the metric to really decide how well it does at being an alternative to normal money.
Hey, personally I wanted bitcoin to really blast through as a true money competitor. However it was immediately apparent they were more interested in turning it into the equivalent of digital precious gems, that was invested in to drive speculation. One day I hope we get a crypto-currency that is a true currency alternative, divorced from the state, and corporate entities. I really want that.
So it is a replacement for Western Union. Not a bad thing if it's helping people transfer money without a middle man taking too much.