Goodbye dollar, hello Bitcoin: is this the end of national currencies?

The emergence of Bitcoins and other forms of digital currency could revolutionise money markets. If competition is so good in markets for products, why shouldn’t we allow competition in markets for currency too?
The upfront cost of printing a piece of paper and calling it “currency” is essentially zero, as Robert Mugabe can confirm.
Who knows if in the future, Australian airlines will hold digital currency reserves to buffer against changes in the value of our dollar?
The short-term benefits of printing lots of money are as enormous as you want them to be, but the long term costs of inflation and loss of reputation are devastating.
But there is no reason to believe that a privately created currency will demonstrate any more monetary discipline than a desperate despot.

This post was published at Sydney Morning Herald on November 26, 2014.