Bitcoin and the contest of ideologies

I see that Lefty John Quiggin is still a complete skeptic on Bitcoin, and that Sinclair Davidson and anyone vaguely libertarian seems to think it probably will work.   But re Davidson:  as with many people, I suspect, I find the Berg/Davidson/Potts papers they keep promoting (which are more about blockchain than Bitcoin) impossible to understand.  They're excited about it, and getting invited to lots of conferences overseas where fellow nerd types seem to spend all day telling each other how it's going to change everything, but the rest of us mere mortals don't understand why the technology, as described, is actually all that revolutionary.    However, pro Bitcoin guest pieces have been posted from time to time at Catallaxy, and so I think SD can be counted as a Bitcoin supporter of some hue, anyway.

Stiglitz has also weighed in saying it ought to be outlawed.    Libertarians and small government types dismiss him routinely for his other views, so dismissal of his views on Bitcoin are just par for the course for them.

Despite the Japanese government, for some strange reason, giving Bitcoin a credibility boost, I am firmly in the skeptic camp.    I can't see the problem that Bitcoin is intended to solve, and the problems of people who seek to trade in the proceeds of crime, avoid tax, or to enable their rogue regimes or companies to have some sort of undercover profit, are not problems that deserve solution (or, the solution will usually deserve prevention by government.)    The energy usage to make cryptocurrencies seems extarordinarily wasteful, and the present speculation driven rise only encourages more coal burning. 

Libertarians like it because they are prone to fantasies about how good everything can be with no, or next to no, government.  But reality is different from fantasy.  

The Atlantic had a pretty good article What on Earth is Going on with Bitcoin and it ends with the simplest explanation, which sounds entirely plausible to me:

4. Maybe it’s just this simple: Bitcoin is an unprecedentedly dumb bubble built on ludicrous speculation.

It seems strange to call a currency a bubble. But lacking more specific terminology, bubble seems like the only word that would apply.

Even if one buys the argument that blockchain is brilliant, cryptocurrency is the new gold, and bitcoin is the reserve currency of the ICO market, it is still beyond strange to see any product’s value double in six weeks without any material change in its underlying success or application. Instead, there has been a great and widening divergence between bitcoin’s transaction volume (which has grown 32 times since 2012) and its market price (which had grown more than 1,000 times).

Surveys show that the vast majority of bitcoin owners are buying and holding bitcoin to exchange them for dollars. Let’s be clear: If the predominant use case for any asset is to buy it, wait for it to appreciate, and then to exchange it for dollars, it is a terrible currency. That is how people treat baseball cards or stamps, not money. For most of its owners, bitcoin is not a currency. It is a collectible—a digital baseball card, without the faces or stats.

The article goes on to note that maybe something good and dramatically different comes out of blockchain and cryptocurrencies, just we don't really know what it will look like yet.   We'll see, but for the moment, I'll remain a blockchain skeptic too.