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arXiv:1312.2048cs.CE

The False Premises and Promises of Bitcoin

Brian P. Hanley

Early discovery. Linked by one identifiable commenter. This paper is outside the main ranking; a mention is not an endorsement.

Abstract

Designed to compete with fiat currencies, bitcoin proposes it is a crypto-currency alternative. Bitcoin makes a number of false claims, including: solving the double-spending problem is a good thing; bitcoin can be a reserve currency for banking; hoarding equals saving, and that we should believe bitcoin can expand by deflation to become a global transactional currency supply. Bitcoin's developers combine technical implementation proficiency with ignorance of currency and banking fundamentals. This has resulted in a failed attempt to change finance. A set of recommendations to change finance are provided in the Afterword: Investment/venture banking for the masses; Venture banking to bring back what investment banks once were; Open-outcry exchange for all CDS contracts; Attempting to develop CDS type contracts on investments in startup and existing enterprises; and Improving the connection between startup tech/ideas, business organization and investment.

arXiv comments
28 pages, 6 figures. JEL: E21, E22, E42, E51, G21, G29, G28 Section 2.6 has been broken out into a separate paper, and that unwieldy section is replaced by a short bit referencing that new paper titled, "A zero-sum monetary system, interest rates, and implications."
Journal reference
DOI
Subjects
cs.CEComputational Engineering, Finance, and Science q-fin.GNGeneral Finance

On Hacker News

Linked by 1 identifiable commenter in 2 comments across 1 thread, from Jan 2021 to Jan 2021. Found in 1 HN submission from Dec 2013 to Dec 2013. Open submission discussions.

Comments linking this paper, per year.

Discussed in comments1 thread

  1. When You Know 2 comments

    • When it comes to Bitcoin, I kind of see it as being similar to gold in the modern world. See Buffett's 2011 letter: > The major asset in this category is gold, currently a huge favorite of investors who fear almost all other assets, especially paper money (of whose value, as…

      throw0101aView on HNParent context

    • An observation from a paper I ran across: > An ECB publication states that bitcoin’s theoretical roots are in Austrian economics[11]. Bitcoin corresponds with Austrian economic ideas in that bitcoin was intended to provide a monetary alternative that is beyond the reach of…

      throw0101aView on HNParent context

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