Bitcoin: What's wrong? What's right?Submitted by Chris Cockamameski on Mon, 04/01/2013 - 23:05
"...There is absolutely nothing keeping me from creating bytecoin, bitcent, bytedollar, bytecent and bitdollar, all absolutely identical in every way to bitcoin, except less famous. The hard part, designing a functional online currency, is already done for me. Just look up Beenz. Just look up Flooz. What would maintain Beenz and Flooz value, when someone else can make Fleenz and Boonz with nothing to distinguish them?
Fiat means "it shall be" in Latin. In regards to "fiat" currency, it means that a worthless piece of paper now becomes money, this paper is better than that paper, and you must accept this paper in return for goods and services because a government said "it shall be so". These protections must exist to support an intrinsically valueless currency because a limitless number of equally valid currencies could otherwise compete.
Certainly, the voluntary system of bitcoin is admirable because it doesn't contain this element of force. However, when the competitors come, and as it is becoming increasingly profitable to do so, they absolutely will, there is nothing to protect bitcoin, bytecoin or any other digital currency from a flood of competitors. If two identical systems can exist alongside one another, the "supply" of digital currency has doubled. If three can exist, then it has tripled. The barrier to entry is only the capital cost of creating a new and better advertised system, and the market cap of bitcoin is coming up on a billion dollars..."