Notes

2.5 Summary
The preceding section highlights the many ways in which the fiat money user is required to depend on trust throughout the money saving and transacting processes. The more this trust is violated (value of savings are inflated away, personal information is abused, payment for service are reversed) the more unhappy users are with relying on this trust. Bitcoin at best allows the need for this trust to be avoided, at worst changes the institutions they are asked to place their trust in.

3.3 Summary
Bitcoin fails to function as a currency in it’s current position, due to rampant speculation. While at first glance this may appear to be a kink in the system that will work itself out as regulations come in that allow users to feel more confident about using bitcoins and they begin to be spent more, its route cause (limited supply) is integral to the system and therefore it becomes difficult to see how bitcoin will become a usable currency before speculation naturally peters out, by which time Bitcoin may well have lost it’s innovative, interesting public image it currently has, and users have long moved on to the next financial innovation.

4.3 Summary
Bitcoin’s utility as a crime enabler means that any government that widely adopted bitcoin would need to spend resources on new anti-crime techniques in order to counteract the likely crimewave that would follow. This itself would have a time lag, in which time serious social costs could be incurred.
But the seemingly inevitable deflationary spiral that would quickly plague any ‘Bitcoin economy’ seems to be such an inherent flaw in the currency that it’s hard to see why any government would prefer to use Bitcoins system as a replacement for their current financial infrastructure and fiat money.