Topic: The problems of crypto currency are the same problems as cash- but fewer. (Read 557 times)

compromised, stolen or lost.

You can lose your private key and be locked out from your own money forever.

I guess there is nothing similar with cash

This is a pretty good analysis.

If we talk about security, one important point that we should use to convince people is how we do not have to entrust our money with third party like banks to keep on our behalf. If we are saying exchangers/online wallets can run away with our fund, so does banks which can also collapse or go bankrupt.

At least with bitcoin, keeping with online wallet is just optional and we can always keep it close with us using HD wallet. If there is a theft or place of residence get burned down, we can always recover the bitcoin from anywhere. Whereas if you keep your money in a safe inside your house, you can just imagine how insecure that is. 

Comparing one to one here, bitcoin is still more secure. 

One more problem: Private Key either being compromised or stolen...
Similarity to Cash: None... We don't have anything backing cash except if it's in a Credit/Debit Card, or there may seem a possibility.
Solution: There doesn't seem a solution yet to me for BTC, as for the Credit/Debit Card, we can easily block it for the thief to become unable to use it...

I have been thinking that the popular analogy of bitcoin being digital cash is a very useful way to explain to people how the oft-mentioned problems will be solved. The common problems with bitcoin will be solved the same way that the problems with cash were solved.  I think this analogy needs to be promoted much more.

Problem: Bitcoin can get stolen/lost.
Similarity: Cash too can get stolen (but is also harder to lose than btc).
Solution: Better storage (e.g. hardware wallets) and 3rd party assistance (not required for experts) such as multiple signatories and bitcoin banks. The latter can also compensate against theft.

Problem: Bitcoin has non-reversible transactions.
Similarity: Cash transactions too cannot be reversed. Once someone wants to keep it, only force will get it back (e.g. from the law).
Solution: Force (this is harder with btc since it needs the divulgence of passcodes/seeds etc) or indemnification by third parties (e.g. btc banks).

These are probably the two main problems that bitcoin and cash share.

The two other big problems that bitcoin has are volatility and lack of incentive. They say that the former will be solved by greater volume and this will take time. I think the latter will actually be solved by ideology and the interests of bitcoiners. Big bitcoin enthusiasts will actually make incentives for the common people. These will mainly be in the form of cost saving via reduced remittance fees and lower cost products. I know that many are disappointed about how some merchants do not transfer the savings to the consumers, but this may slowly change with enthusiasts doing as much as they can. E.g. Microsoft used to actually give away computers to public libraries to promote their products. I think that guarding against inflation will also be another big incentive. People will come to know that is is safer to have BTC in the long term than having fiat.