Bitcoin Is (Still) Not Doomed

Washington Post columnist Henry Farrell has just added himself to the Nakamoto Institute’s running list of skeptics making bold assertions about the certain demise of Bitcoin. In a post entitled ‘Bitcoin’s financial network is doomed,’ Mr. Farrell demonstrates his short-sightedness in the face of Bitcoin’s subtlety and allure, perhaps as a cunning-though-not-so-original means of acquiring cheap coins for himself. Regardless of his motivations, I couldn’t resist a full rebuttal, if only to reassure the weak hands among us that no, Bitcoin is still not doomed, and yes, Mr. Farrell is in for a rude awakening if he really believes the poor arguments he makes in his Post article. Without further adieu, a rebuttal to Mr. Henry Farrell, Bitcoin Skeptic:
‘There is a reason why you have to ‘comply with hundreds of pages of regulations’ to use the Visa network that goes beyond Visa’s selfish corporate interests. That reason is government.’
No, the reason you have to comply with hundreds of pages of regulations is that those networks are run by centralized entities that reside in a particular legal jurisdiction and are therefore vulnerable to attacks by the government and other powerful adversaries. The centralization of the networks precedes their vulnerability. Without this vulnerability, government regulation is as effective and enforceable as a law against breathing. See: Bitcoin.
‘Governments regulate payment networks very heavily, for a wide variety of reasons, which include making sure that people don’t use these networks to support activities that governments don’t like. They use financial intermediaries as ‘points of control’ that allow them to control who does business with whom.’

This post was published at Bitcoin Magazine on DECEMBER 25, 2014.