Topic: newbie Q about bitcoin exchanges & governments (Read 355 times)

Ucy, this is why I asked in the first place. Seems to me that unlike what we are being told, the system is still dependant on the financial world on the outside, so in essence this defeats the purpose.

If someone could convince me otherwise I could convince myself into buying bitcoins, otherwise I would be just as good off buying gold.   

Maybe if bitcoin could become a gold backed coin somehow...

Good observation brother. If exchanges are easily controlled by a person, government or organization then the goal of making Bitcoin in particular and Cryptocurrencies in general decentralized is defeated.

If the peer-to-peer network would span the world and every living being in the world, I would agree nobody would feel the need to use fiat currency. However, I do live in the real world and not in a digital one. Which means I must pay bills, taxes, living, ....
So, sooner or later, maybe those that inherit everything I own, will need to be able to convert bitcoins to fiat money at one time or another.

Personally I do not see it as an investment, but rather as a store of wealth, which, unless mistaken, was the original intent. In that case being able to go from one currency to another is primordial.

You are not seeing it wrong entirely yes the government may do that and it would only be under circumstances where they fear it. Then again a smart government may regulate it and earn huge amount of revenue from it, look at Japan. The problem I have with exchanges is that default way to often and then government is called in. Then there one more point why do you use a exchange for Fiat when you could do it peer to peer or on this forum. Maybe if you want Fiat just look here for some one in the currency exchange, only deal with trusted members

Well, if you think the government would be that antagonistic toward bitcoin, then perhaps they will do that. Yes, if they indeed close down exchanges then there would be no more exchanges through platforms. But does it hinder, for example, the two of us to transact such kind of stuff? You can send me money and then you send your BTC to me. That can still be done.

Destroying a cryptocurrency exchange means shutting down the servers and arresting the exchange owners.
Decentralized peer-to-peer cryptocurrency exchange platforms will solve this problem because there won`t be any owners and the servers will be totally decentralized.Offshore hosting is another solution.
Making buying and selling bitcoin offline easier is the most important improvement that will make the number 1 cryptocurrency independent from exchange platforms.

We all know that the amounts of bitcoins are limited, with increasing difficulty in creating more bitcoins towards the end. This means that the reasons for converting fiat currency to bitcoin increases as time goes by. So in the end this is all tied together.

The reason for the existence of bitcoin in the first place is libertarian, so the fight against government control. I'm fine with that, but knowing how governments operate you need to make sure that you have all ends covered, which means including the convertibility issues.

Gold conversion isn't the answer either, as it is controlled as well.

Unless bitcoin can create an economy of its own, where a lot of sellers want to use it (easily controlled by the govs) bitcoin has a problem.
So again my question is, what happens when the govs crack down on the exchanges all over the world and restricts what you can buy with it. I do not want to buy stuff on the darkweb so it seems to me that you loose the investment value of your bitcoins at that point.

Then another question pops up : what if this is all a game to get digital currency and ultimate government control implemented.
I do not want to start a debate about the founder of bitcoin, but what do we actually know about him. Are we sure that the govs were not involved from the beginning ? And don't tell me that the govs are not that smart, because they absolutely are this smart.

Of course!!!!
The American government wants all the money to control.
Only more and more difficult for them to do it.
You can open an account in independent countries. In a world of many banks.
Why open a Bank account which begins before the FBI?

Yes, I have often thought about this too...a government crackdown on the exchangers could slow down bitcoin adoption and would probably cause a temporary decline in the price. However, part of the original idea of bitcoin was to actually use it as a currency for normal transactions, and the more we are able to do this the less dependent we will be on needing to convert bitcoin to fiat in the first place.

As it stands right now, if governments do interfere with the exchangers to the extent that it is very difficult to cash out the BTC, one way around this would be to find a reputable precious metals dealer and exchange the BTC for gold or silver and then sell these metals for fiat when necessary. It is also possible to gain some additional profit if the price of gold/silver increases due to inflation or instability in the economy, which could happen if things get to the point where governments think that they need to somehow stop people from using bitcoin.

I'm a newbie, so forgive me if this question has been asked before.

Anyway in my search of information about bitcoin it seems that a weak point of bitcoin exists in the sense that in order to be able to easily exchange bitcoins for fiat currency, you would need to rely on exchanges to perform that task.
It looks to me that the governments could easily, in a joint effort, take down the exchanges and therefor seriouly hampering the use of bitcoin.

Am I seeing this wrong ?

Input is greatly appreciated.