Topic: [2014-04-30] Larry Summers has warning for Bitcoin naysayers (Read 1183 times)

he offers this to critics of bitcoin and other cryptocurrencies: “The people who rejected the Internet as a curiosity for scientists were on the wrong side of history, the people who rejected digital photography as really an artificial thing were on the wrong side of history, and the people who felt that non-gimmicky tennis racquets were made with wood were on the wrong side of history. So it seems to me that the people who confidently reject all the innovation here [in new payment and monetary systems] are on the wrong side of history.”

To Mr. Summers, the potential contained in bitcoin’s breakthrough technology, with its fast, low-cost system for confirming transactions, is demonstrated by problems with the current multi-layered system for domestic and global fund transfers. He cites, for one, “the costs to transfer money to a child in college either within the United States or across international borders, or more consequently, what it costs an immigrant to remit money to Mexico or the Philippines.”

Mr. Summers also notes that the existing system requires “enormous investment” in mitigating credit-card fraud and that in an “increasingly uncertain world” there’s a natural desire to have “secure global stores of value,” a role that some digital-currency enthusiasts see being performed by these new instruments.