It doesn't matter that a business isn't making a business decision based on altruism. What matters is that the incentives of the users are aligned with those of the business
I think it's considerably better when it's not based on altruism, because it's easier to predict how stable or sustainable an alignment of interests might be.
The loss of privacy in this case may not be worth using a public ledger.
In general though, I think it would be an interesting experiment if individuals can hold central bank money directly instead of going through commercial banks.
I think there are plenty of ways that privacy could be regained... layer 1 settlements, use of an anonymous protocol like MimbleWimble, etc. It wouldn't necessarily need to be Bitcoin as it's implemented today.
But I agree... that experiment would be quite fascinating. It might not even be that big of a change... most people would probably continue to entrust a bank with their funds, and banks could potentially continue to operate a fractional reserve system.
How do you define "1$ USD peg"? As of right now, the price of DAI is $0.98, 2% off its "peg". Asking as a serious question, since I see this statement a lot.
Dai is not really a traditional peg, as in the sense that there is someone who always trades on the market to maintain the peg (a liquidity provider like in USDT). It's more of an example of a system that has carefully balanced economic incentives. The fun part is that anybody can mint or destroy DAI, and take advantage of arbitrage opportunities.
For example, if I ever see DAI trading at, say, $1.02 then I would quickly mint some new DAI and sell for USD. Likewise, if DAI is at $0.98 then I would buy it back, then burn what I've minted, collecting a profit.
Well, pegs with a defined fluctuation boundary aren't that uncommon, for example, Danish Krona currently is pegged to Euro in such a manner - where it's pegged to within +/- 2.25% of a specific rate.
In essence, if you declare a plausible intent of keeping a rate near 1$ by accepting limitless orders to buy it at 0.98$ and sell it at 1.02$, and can keep that promise, then that's a decent peg.
That's just due to liquidity. The peg is maintained through arbitrage, so of course if you have low liquidity you're going to have fluctuations around the peg.
How would that work? You put money in a bank, the bank can only keep it in the vault, sitting there doing nothing waiting for you to take it back, unless it can lend part of it out. Thus fractional reserve. Loans existed before banks, but fractional reserve is the whole trick behind banks. Banks started out, I believe, as as goldsmiths[1]. They were places where people paid to keep there gold and and other valuables, and got a receipt for the deposit. These goldsmiths also loaned their own money to people at interest. Eventually some of the more risk taking ones decided that since not all depositors would come for their money at once, they could lend some of deposits out at interest. Modern banking was born.
The value of Bitcoin comes from social consensus. You cannot fork that. You can only fork a code repository. End of the day, it is just a bunch of 1s and 0s without a social consensus of value.
> The value of Bitcoin comes from social consensus. You cannot fork that.
Can’t? Perhaps it is difficult, but not impossible. I can think of some examples of forking social consensus: x11-wayland, Debian-Ubuntu, star office - open office - whatever office it is now.
> Well, Journal uses zero-knowledge encryption that ensures Journal employees can’t read or decrypt the information of the user.
This isn't an actual zero-knowledge proof, just regular encryption as the image below describes. Not sure why it is described as 'zero-knowledge' in the article.
