In any argument about “Bitcoins ain’t money”, its alleged anonymity was the most powerful comeback of apologists of crypto currencies.
However, with the recent confirmation of (at best) weak anonymity of Bitcoins, one (if not the only) benefit of owning electrons “mined” in someone else’s computers is going to disappear.
Here’s a couple of points to contemplate on:
- The ledger is public. All related transactions are recorded and linked to each other by the block-chain design.
- Most, if not all, endpoints where virtual currencies could be converted into something tangible or fiat papers, are controlled by the institutions, issuing said fiat currencies. All sorts of identification requirements are imposed on anyone opening an account. Very much like you’d expect walking in a bank to open a new checking account.
And with this, any dreams of being an anonymous, omnipotent alternative system of high-tech “money” are gone for good. It didn’t exist in the first place for the lack of tangibility and intrinsic value. But now it should be clear even to the die-hards.
It doesn’t mean you’ll see the crash in the prices tomorrow. The speculative cycle might as well keep going for Dao knows how long. But it is going to end. Like all the bubbles have before.
Don’t get fooled by the shiny, gold-like images of Bitcoin. Unlike real gold, being a mere electronic construct it doesn’t shine.