My Journey of Disliking Digital Currency to Liking Cryptocurrency

8 months ago

Yesterday I posted about the cash-crunch and the push for digital currencies and more control. The move from physical money we can possess, to digital virtual money we don't have as much control over, is something that has concerned me for many years.


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In 2006 or 2007, I read a book called Spychips: How Major Corporations and Government Plan to Track Your Every Purchase and Watch Your Every Move. I became keenly aware of technological aims at creating a more regulated and controlled way of life for businesses to target ads to us based on where we are (like in Minority Report), and being able to track us anywhere.


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That's also a great benefit for the government when "cracking down" on "bad" people like dissenters of the status quo who are trying to change things and heal the corruption of our false way of life.

Digital currencies are a part of that plan, where all of your currency would be digitized in bank accounts so that if you stepped out of line in society, the government could freeze all your money and you would be helpless to survive outside of the system. Now that is part of the end-game of digital currencies and other technological control mechanisms enabling mass surveillance and monitoring of behavior.

At around the same time, or a bit before, I learned about usury, fractional reserve banking and fiat inventing money out of nothing with no backing in reality to give it value. Then I heard about Bitcoin in 2013, and it stunk to me at the time.

I wanted to get away from "inventing money from nothing" models, and get towards sound money. On top of that, this was a digital currency which played right into the hands of the agenda to digitize and control everyone's money. But for now... it wasn't regulated under statist governance... for now... Which was still something that could change.

Bitcoin "mined" the "gold" on a computer. What a joke though. Seriously. Why would it have any value when nothing was being done in the real world? It didn't at first. As with all currencies, it's because all that a currency needs in order to have value, is people to believe in it's value and use it as such. Once it starts to get used, it gains even more value.

A belief can sustain the value of a currency despite a break from the real-world reality of the market. This has been the case in recent decades. The physical world and what gives rise to the economy is not causally linked to the outcome of the "markets" man has invented. For Bitcoin, no one actually had to do anything in the real-world, to go mine any gold for example. There was no real gold that anyone worked to get. It was just a hash-calculation method to make people use electricity to create tokens out of thin air. Ok, people can just use it and make it more valuable. But any token could be created from nothing and used for value as long as many people accepted it as a medium of exchange.

Digital currencies primarily based on speculation are not my ideal kind of currency from how I understand things. Plus there is the possibility of what exists in a virtual reality going away. The internet is more likely to go down than all gold or other physical assets going "down" and disappearing from existence. Physical currencies are more real than digital ones because they are in physical reality, not simply virtual reality. That's not to say cryptocurrencies don't have some advantages either. But we don't exist in a virtual reality. Physical money is always better because you actually have it in your possession in reality. You hold it, it's there. I also recognize digital currency can be safer, such as from theft of a burglar or government. There a trade-offs indeed.

I have since lessened my distaste for Bitcoin and cryptocurrencies, as they are more secure from statist theft than standard digital currencies in banks. But most cryptocurrencies are still removed from reality and actual labor or work of some kind that people do to create something in the real world which is of use. That something in the real world is then used to back a currency and give it value by grounding it to reality.

It seems reality is being detached from what we do in many facets of our life, and people are all too lost in fantasies of how things can work in reality. People seem to like fantasy "currencies" that have nothing behind them to back their value apart from faith, loyalty, trust and belief in it having any value at all. I think that's why most are called "shitcoins". Some currencies have more real-world value though.

It's like all you have to do is "believe" and it becomes "reality". Scary power our consciousness has! If only one person believes it, it has no power. But when many people believe in a belief cast onto consciousness, then that belief has a lot of power in our lives, as I have talked bout many times before.

If you have a hard time understanding why grounding in reality matters, like actual work to make something, then imagine a country or community creates its own currency, and yet no one does any work to produce goods or services. How would you value that currency?

Some people might fall for it and give it value, but others would recognize that the community isn't actually making anything, yet wants to buy things to survive with their "magic money". If this would be accepted, a community could produce no products or services, yet have a currency valued that cold by products or services that others actually work to make. That currency would be worthless, despite people "believing" it's valuable! Who the hell would value a currency with nothing behind it to represent an actual value in the real world? This is the deception behind belief-based currencies that run on speculation of imagination alone. That's living in fantasy clouds, not being grounded in the world where things happen.

This is the issue I have with almost all cryptocurrencies, except STEEM has Steemit.com which has some real value behind it, as I have talked about before.

If a currency is created, yet has nothing behind it except "promises" and speculation, it's not worth very much to me. STEEM has something through Steemit.com: the content! That's why producing quality content matters. Currencies need real value, from real work/labor that people do to create content. That's what will back the STEEM currency and give it real-world value from the real-world work to produce content that exists.

And as you may know from what I have said in posts before, is that I advocate content that matters in people's lives. Quality content can be anything of quality in a specific type or category of content production. When I refer to "higher quality" in terms of my own work or others, I'm usually referring to the quality of information and it's import in our lives, as the quality of information that can affect the quality and condition of our lives. Especially when it's not only situational or temporal information related to an event or a time period, but "timeless" knowledge that applies at any time.

So that's my own issue with how a currency is supposed to have value in reality, the real world, where something real has to be created to give a currency any value, and not simply base it on "belief" and speculation like most cryptocurrencies are.

The frequency of use helps, but gold doesn't need to be used as a currency to be valuable, as it isn't used to buy much of anything in our current economic model. Currencies do need to be used, and they have to have some real-world significance behind it as I demonstrated in the thought-experiment of a country that produces nothing yet having a valued currency. Bitcoin only has value because of being the first, which people adopted and accepted through transactions to increase its use and value, sustained largely by belief and speculation of its use. It has nothing behind it to sustain its use. Any other coin that does better (like STEEM) could replace it.

STEEM has the potential to have real-world work that people produce in order for it to be evaluated beyond mere speculation and the frequency of its use. Sure the frequency of use is important, but that increases when there is a product that is being evaluated in the first place. Content is the product that is being offered by Steemit.com in order to give value to the token STEEM.

I would not have liked crytpocurrency that much if it wasn't for STEEM. I only bought Bitcoin for the first time after I joined Steemit.com, and it was to buy STEEM, not even to hold onto Bitcoin. My dislike of digital currency carried over to cryptocurrency, but thanks to STEEM and Steemit I gained more respect for the potential of cryptocurrency.

Crypto is better than simply digital indeed, but I still prefer physical to virtual currencies due to it being an existing thing I can grasp and control more than any digital kind. Digital currencies are more convenient though, which is why the public is falling for the cash-crunch and not even questioning what is going on.

That's my story :)

Do you have a story to tell (or info) about digital currency vs. cryptocurrency? Please share.


References:


Thank you for your time and attention! I appreciate the knowledge reaching more people. Take care. Peace.


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@krnel
2017-02-16, 12:01pm

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  1. I think that you would do well to re-read Plato's "Cave" analogy before becoming too dogmatic about the physical having a greater claim on "Reality".

  2. Crypto-currencies do have something backing them that has a great deal of value: an immutable ledger. And they have a real-world use for hard money advocates: The ability to sell your hard assets in one jurisdiction, transport the value to a freer jurisdiction, and then re-buy hard assets in that new jurisdiction.

  3. It has been my experience that there is much truth in the statement: "You will see it when you believe it."

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Thanks for the feedback. An immutable ledger is something useful in itself.

"(...) producing quality content matters" and that is the #1 reason why I pay attention and set myself into the proper mind frame to write my articles as well as my comments and replies. It helps us all on the long-run!

I very strongly believe that trust in the quality "content is the product that is being offered by Steemit.com in order to give value to the token STEEM.", thus the quality of information shared becomes paramount in the success of our common venture on Steemit.com

as much as I would love to like the physical currencies, history shows over and over that because its physicality, it can be stollen. On the other hand, a cryptocurrency of the strain found through Bitshares and Steem allows no one the potential of stealing it from you, in itself, the #1 reason why I would opt for digital currency over the physical one. The situation we find ourselves in right now in relation to the build up of an hegemonic centralized governance widely corrupted convinces me once and for all and, with the advent of Bitcoin, I couldn't help myself but to move in that direction. When finally Bitcoin found itself decentralized through Bitshares, I was totally and entirely taken in till governance becomes once more true to the law of nature's ways.

Thanks again for a magnificent post of such high quality. All for one and one for all! Namaste :)

P.S.: I figured that the sentence where you wrote "I have since lessened by distaste for Bitcoin and cryptocurrencies" actually must have meant to say : "I have since lessened MY distaste for bitcoin and cryptocurrencies"...

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Haha, thanks for the correction.

I agree it has that trade-off:

I also recognize digital currency can be safer, such as from theft of a burglar or government. There a trade-offs indeed.

But depending on the virtual world too much has its potential drawbacks . Thanks for the feedback as usual ;)

Cryptocurrency and decentralized.

Love the transformation, me Im just getting more crypto crazy by the minute. Getting my interview published on cointelegraph is about the biggest thing that has happened to me so far in this amazing adventure. thanks for the brilliant post @krnel

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Great! Congrats! and welcome ;)

Wow, excellent! You have pretty much outlined my own thoughts about this aspect of life and reality.

Prior to my finding Steemit (about two weeks ago) my exposure to cryptocurrencies was limited to a basic awareness of Bitcoin, as an extension of a few of my nerdier acquaintances asking me if I were interested and wanted to invest. I could never get around their argument that fiat currency was based on "nothing" and central banks could just "print money" and that was BAD... and yet they were advocating a virtual currency based on? On? On? Turning on a computer?

I get that currency is merely a "a temporary store of value" that exists only because of widespread agreement that it's a store of value. It allows us to trade apples for carpentry... and that's a pretty nifty thing.

My primary hesitance around cryptocurrencies (aside from the legitimacy issue) has always been that they are "small." Meaning, what it to stop a virtual kabal in the tradition of the Koch Bros. from coming in and taking over "the system." The market cap of Bitcoin is about USD 16.5 billion, which is not very much in real world terms. Humans are opportunistic and greedy.

I, too, like Steemit because there's a tangible "thing" here, a longer term store of "something" to warrant the existence of Steem, as a currency. That's pretty cool. Am I merely showing myself to be "old" by finding that a positive? Maybe. But there's part of me that knows I can't "eat" dots and dashes... I need food.

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Thanks for the feedback. Indeed, they are small, but everything usually starts small then grows. The USD was small when it was only used by 13 states. Eventually it become the world currency. Influence factors in. How to get influence? People. Using transactions is one way to get influence. Using a site for social media and content creation backing a cryptocurrency, is another that is more visible, and impacts more of our attention bias and availability heuristics. STEEM has lots of potential.

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Agreed, Steem has a lot of potential. Our task then (or so it would appear) is to be good stewards and nurturers of the goose that lays golden eggs, rather than allowing it to be raped to death.

I previously lived in the Netherlands and had some experience of the squeeze on cash. Back in 2012 Dutch supermarkets got together and decided they would eliminate cash transactions from their business by 2014. Their ostensible reason for this (stopping robberies) was laughable.

I watched them implement various measures to try and force this, the most obvious of which was to slowly decrease the amount of tills which would accept cash. It was quite possible to be stood in a queue of eight people waiting to pay for shopping whilst two card only tills waited for customers.

When newly setup retail businesses started to implement the refusal to take any cash as part of their business plan it became clear to more people that something bigger was going on.

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They tried to fast and too big. Gradualism/incrementalism, as I mentioned in my previous post today on human gene-editing, is the a key methodology used in social engineering. Good on people to notice the change. They need to tell the story for generations so as to no get duped later on ;) hehe. Thanks for the feed back!

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No probs. If you're interested The Netherlands is often used as a test market for innovation. In consumer banking they seem to get everything first.

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Here in New Zealand it's a bit like that too. When eftpost came on the seen we were one of the first country's to rapidly incorporate it into the monetary system

I got really excited the other day when I realised for the first time I have been using Steem and Bitcoin regularly for something. I have been earning Steem from Posts and spending Steem Dollars to promote posts.

For the first time digital currency is real for me and it's all because of Steemit.

I like where this has brought us all together and made us aware of what we believe has value. I started with bitcoin in 2014 and have learned to trade it, invest it, and properly store it. Now I use it to have my voice heard as well as learn from other intelligent and liked minded individuals. Amazing how it brought me here to Steemit. Great Article and Great Comments and Much Appreciated...Thank You All

Frank

I wanted to get away from "inventing money from nothing" models, and get towards sound money

Money is inherently symbolic, and has never had any "true" value at all.

It is completely made up, and trying to find the "One True Currency" will never happen.

No material on earth, no piece of paper, no bit of data, has any more value than your mind gives it.

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As with all currencies, it's because all that a currency needs in order to have value, is people to believe in it's value and use it as such.

Why most bitcoiners are simply saving money for hackers, since their screens and keys are hacked and sniffed:

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Hehe. Glad I use a desktop only.

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Desktops are in no way immune to being hacked. I suggest you re-watch the speech.

downvoted: overrewarded, concentrated whale voting

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concentrated whale voting

What does that mean? Thanks.

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The term I've heard lately is "whale swarm." I think this is similar.

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What is a "whale swarm"?
What are the parameters that constitute it?
What is the SP required for someone to be a whale in a "whales swarm"?
How many of these whales need to be voting for it to be a "whale swarm"?

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It's all subjective.

Another one you could add is piling on. In the end the result is the same, massive payouts on a few trending posts and favored authors and the bulk of the user base fighting for scraps. All I can do at this point is make the scraps a little bigger.

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You need to define things. You say it's for X reason, well what does X mean? Define it, or else it doesn't really mean anything does it? You can just make it "subjectively" mean anything you want.

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[nesting]

You need to define things.

Incorrect

You can just make it "subjectively" mean anything you want.

Correct

If you like real-world value behind your crypto-currency, have a look at Gridcoin and SolarCoin.
Gridcoin is issued as a reward for contributing computing time to solve real scientific problems, like finding cures for deseases like Ebola, HIV, TB, cancers and many more feilds of study ranging from Mathematics, Astronomy, Particle Physics.
SolarCoin is issued to those who produce clean solar PV energy and is intended to act as an incentive to increase clean energy production.

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Thanks for the suggestions.

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...All done with bitcoin as well. ...And probably more easily, since bitcoin has more value. Currency, by definition, can already be allocated to any task. None of those things is even optimally fungible, as "general intelligence" is. ...And that's the only thing that lends itself to being generalized as a "value store" for a digital currency in an age of computation. --build a bigger brain.