Large central banks have not and will not use Bitcoin, nor do they need to. Their function is to manage money supply, they are not going to give that up and use a currency outside their control. They also don’t ship gold around much, there are custodian banks that hold reserves for them and gold is really a minor part of the system now, the whole thing runs on trust and confidence, not physical gold reserves.
In addition the protocol for Bitcoin is thoroughly unsuited to global transactions, precisely because of the distributed nature, it is strictly worse in most ways than the current system of transactions with trusted counterparties. You can have distributed, fast or cheap - you can’t have all three.
Well, at this juncture, it looks like the way banks have handled the money supply is crap. They currently have a choice between inflation or recession due to too much QE - but that’s a discussion for another day. I predict that as global turmoil continues, you’ll see countries trust western custodians of gold bullion less and recall gold to their own vaults due to the deterioration of trust in third party audits. I’m not saying btc will be used any time soon, but Ithink it will be used due the my points in my previous post.
Anyway, once gold is mined in out space and we have a glut, commodities will become less and less suitable as a fallback when we have sovereign debt crisis’ due to the elastic nature.
Moreover @kenny, my point is that btc, like gold, will back sovereign currency, not become fiat.
I completely agree. Their actions from 2008 onward, or even 2000 onward, have in my view caused this series of crises by causing asset bubbles. They are to blame and they know it but lack incentives to do anything else.
I have a lot of sympathy with this part of the Bitcoin thesis (sound money independent of central banks). Unfortunately the structure chosen to boost adoption and the ease of replication has seen it and similar digital currencies used as a speculative asset and vehicle for fraud of various kinds. It is also sadly unsuited to any volume of transactions due to the insistence on decentralisation. So IMO it is not a good global currency and will not see adoption.
The problem with going up against fiat is you are essentially challenging the set of rights over their citizens that states claim for themselves. These are jealously guarded by states with all the powers at their disposal (as in for example classing it as an asset and then taxing every transaction or just banning it outright).