Showing posts from July, 2016

"Blockchain" technology is inevitable but Bitcoin and other "crypto-currencies" are irrelevant

Blockchain technology as a fundamental re-ordering of infrastructure of money flows in global financial system is pretty much inevitable. Bitcoin or any other “crypto-currencies” such as ether are unnecessary which is why they will remain marginal or disappear.
Blockchain model accomplishes the objective of instantaneous and virtually cost-free transfer of money without the need to invent any new currency to do it. USD and EURO are perfectly fine as they are.
The way it works in the physical world is that if Steve wants to give me $75 he looks into his wallet, takes out $75 in bills and gives them to me and I put them into my wallet.
In the non-physical world, if he wants to do the same thing, he tells his bank to reduce the amount on deposit in his account by $75 and his bank in turns tells my bank that they should increase the amount on deposit in my account by $75. The intermediate step in the process is that the bank account that my bank holds with Steve’s bank or with a clearing ins…