Bizarre Financial Innovation "Paper Cash" Insecure, Criminal, Frankly Nuts
Amusing parody from Ledra Capital: what if government and media looked at paper money the way they do at Bitcoin?
Excerpts, though the whole thing is comedy gold if you are a Bitcoin maven:
Bizarre Shadowy Paper-Based Payment System Being Rolled Out Worldwide
World governments announced a plan today to allow citizens to anonymously carry parts of their wealth on their person and exchange it with others using small pieces of colorful paper printed with nationalistic and Masonic imagery along with numbers that purportedly represent the amount of wealth each piece of paper represents (if the paper is not a counterfeit). These pieces of paper are formally a "note" from each nation's central bank, but they are also called "cash" by many—this is a technical matter that is too complex to cover in our basic primer; Suffice it to say, that it is representative of the complexity and user-unfriendliness of this new system….
In what will come as a surprise to generations who have grown up with calculators and computers, 'bills' only come in fixed denominations, requiring users to maintain a large number of these pieces of paper that must be aggregated to execute a transaction and then re-aggregated to 'make change,' a complex process of returning to the payee the excess of the payment using yet other bills. (Don't worry if this sounds complex, we had trouble understanding it ourselves at first and it is certainly not ready for the average consumer in its current form.) …
The launch of cash has provoked an immediate reaction from law-enforcement agencies worldwide that universally condemned the development.
"Cash is a 100% anonymous and untraceable payments technology. It is like a weapon of mass destruction launched against law enforcement," said Mike Smith, the recently confirmed FBI Director. "It is the perfect payment mechanism for criminals, drug cartels, terrorists, prostitution rings and money launderers….
Banking Superintendent of New York State, Mike Smith had the following to say: "I can't think of any reason that a law-abiding individual would want to use cash. At a bare minimum, we believe there should be a licensing procedure for individuals or businesses that plan to use cash, a 'Cash-License' as it were…."
Others have concerns about forgery and counterfeiting. "Ultimately, even with all the fancy inks, cash is just a piece of paper. We fully expect criminal groups and rogue nation states to print fake cash in order to profit or to disrupt the economies of their enemies," said Mike Smith, an analyst at Stratfor. "In the interim, we are certain that cash will trade a discount in the real-world, given the risk to a counterparty of accepting a forged piece of paper; no doubt cash is a huge step back from the modern cryptography in place throughout our current financial system."…..
Though hard to imagine, cash operates with no consumer protection at all. If your 'bills' are stolen or lost, they are gone forever….
Sure, some people may market "wallets" that will supposedly protect your cash, but:
But some early adopters have reported that the hardware wallets have security flaws. "I was out in Bangkok two weeks ago at a bar and I forgot my Gucci wallet there," said Mike Smith, a visiting tourist. "When I returned the next morning, my wallet was there but my cash was gone!" We contacted Gucci regarding this hacking attack, but a spokesperson would not comment "about confidential customer financial matters."
Even criminals have not been immune to the risks of cash. The notorious "Silk Road" drug-dealing marketplace, where vendors and customers left envelopes full of cash (on which they had very clearly written their names) in an anonymous drop-box that managed the exchange, mysteriously closed last week, citing 'theft of the cash due to a bug in the envelope sealing process.' ….'
In what might be most unusual limitation on cash, it only works for payments within 36 inches or less (or the so-called "arm's length transaction" as hackers in the community have colorfully titled it) as it has to be handed from one (human) party to another to execute the transaction.
This requirement is widely thought to be a fatal flaw of cash by traditionalists.
Mike Smith, VP of Retail Banking at Chase said: "A form of payment that cannot be used at a distance, cannot be used for e-commerce, cannot be used by mobile devices, cannot be used for machine based transactions, cannot be scripted or programmed, cannot be thought of as a payment system….
Remarkably, if you attempt to use cash in a different country from the one that issued it, it will categorically be rejected….
Economists are flabbergasted that lawmakers have allowed cash to be adopted….
Environmentalists expressed concerns about the impact of cash on the environment. "You would have thought that in 2014, we would have moved beyond pesticide and water intensive cotton farming [retracted: cutting down trees], treating the cotton with dangerous inks and transporting it with fossil fuels, only to represent a value like "20" that can be represented electronically at effectively no cost…..
Bonus Bitcoin links: Derek Khanna defends Bitcoin and digital currencies from the hidebound opposition of the likes of paper money mavens Alan Greenspan and Paul Krugman, analogizing them to people opposed to phones in an age of telegraphs; Cathy Reisenwitz on the "social issue" benefits of Bitcoin, when it comes to access to both credit and charity for the world's poor.