Wonderful clickbait headline in The Australian: Why bitcoin won’t work.
- It offers no lender of last resort.
- Unreliable exchange of value.
- No profits for central banks.
With the distributed ledger technology (Blockchain) we don’t need a central bank (to be clear the government may still need a banker but that can be put out to tender). Similarly because opportunism is suppressed and information asymmetry reduced we don’t need a lender of last resort – in fact insolvent banks can be liquidated in tens of minutes.
Then there is the assumption that deflation is a problem! Really?
It is true that Bitcoin is now too valuable to use for day-to-day shopping. The days of using Bitcoin to buy pizza are long, long gone. Yachts maybe. But there are other cryptocurrencies for that sort of thing – not to mention fiat money. Use ordinary digital money (credit/debit cards) for day to day usage and cryptocurrency for more specialised use.