Why are nations even creating own cryptos? Programmer explains.
Bitcoin is revolutionizing the finance industry and several nations are announcing their own cryptocurrencies. Venezuela is the latest example with The Petro. Today I share some thoughts of this phenomenon of nation state backed cryptos and would like to hear your opinions!
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Ivan on Tech by Ivan Liljeqvist
Lol, governments are panicking.
Either they will make their own crypto, or people will hold money in Bitcoin and goverment gets nothing out of it. Its a deseperate move.
Yes, I agree
Bitshares decentralized exchange is the future!
https://bitshares.org/
They have a choice to get swallowed or tap into the blockchain.
Keep up the good work Ivan :)
indeed! So happy to seeing nations doing this, will only help to even faster adoption! Exciting!!
Thank you @ivanli! Inspiring someone from Europe doing so well :) Cheers!
btw, recently did the post about top cryptoexperts to follow and you are one of the featured people there ;) - 40 Best Blockchain Influencers & Cryptocurrency Experts To Follow in 2018 (On SteemIt Too) - http://bit.ly/2AdNCn0
That is an awesome list bro!
Great point. Having a local cryptocurrency would definitely reduce the inflation. There will be issues with this model. Trust issues will definitely bring it down in the long term.
A very important reason missing from your list. Every transaction that occurs will be electronic and on the blockchain. That allows much easier monitoring of activity for multiple purposes, among the most important to a government is tax collection. Other purposes will vary and be dependent on the ethics and intentions of people within the governing agencies.
Note that most governments and banks have been moving towards “cashless” systems already. Use of blockchain based currency facilitates the transition that is already occurring.
The biggest question remaining is how current banks fit in this new paradigm for money.
Lol, this hole story reminds me of kodak!
Government = Politicians and politicians can't be crypto leaders as transparency is not part of their tradition
You're right.
Venezuela is launching their own crypto, which is a way to save themselves and get back the lost trust of their people, I just hope for the sake of their people that the goverment won't ruin it like they did with the fiat.
“Venezuela will create a cryptocurrency,” backed by oil, gas, gold and diamond reserves, Maduro( The president of Venezuela) said in his regular Sunday televised broadcast.(Reuters.com)
The first step in trying to force people to use their currency and regain control over our entire economy is to make it.
If nations build their own cryptos, they'll having competing nations trying to crack their system to figure out ways to bankrupt them. If nations ADOPT cryptos that already exist, people may still want to crack them, but if all nations unite under a world currency ... well ... we'd be incentivized against having a weak defense.
There are pros and cons.
Crypto backed by some other asset suggests that its internal mathematics aren't sound enough to be trusted on its own. This seems pointless to me. What is the government saying when they say that 1 digital asset is equal to one gallon of petrol? Is their math less trustworthy than the likelihood of receiving a gallon of petrol for every digital asset you lose?
Just another way to say "trust us instead of mathematics". History shows where this goes. Trust in authority will always dissappoint. They will run off with your national crypto if you're foolish enough to trust it.
Cryptocurrencies do tend not to stay "pure". In order to gain even more momentum a lot of them try to have functions of other things that have already been established. For example now we have coins that pay you dividents like a stock of a corporation. We already have many coins that give you certain voting rights (again a lot like a stock).
Backing up a crypto with real tangible assets is something that comes from securities (https://www.investopedia.com/terms/s/security.asp). Simply told, a security is a piece of paper( a document) that manifests a right to get a monetary asset from a debtor, who is obliged to give it to you. The price of the security is not that of the piece of paper but reflects the asset it manifests. This same thing is beginning to happen to some cryptocurrencies.
It is a real phylosophical debate, whether cryptos should stay "pure" and really dusrupt the past and create really a "new economy", or should they adopt the usages of other already existing things and mix them with blockchain technology to basically becomes somewhat of a mix between the two, so that adoption of this new tech become more widespread.
I''ll love to hear some opinions on the manner?