This highlights well some of the conversations I have with folks who want to replace fiat currencies with cryptocurrencies. Sure, one can design a better monetary system, but that doesn't mean people are going to want to use it.
You have to incentivize and enable people in order to get them to change.
M-PESA and the similar mobile money telecom products are doing more for digitizing and disrupting fiat currencies than cryptocurrencies are currently. Bitpesa is having some success as a bridge between the two, but it's going to be a struggle for any cryptocurrency or token to surpass the usability of digital currencies tied to the devices they already use and th kiosks / storefronts around them.
It's actually similar to a cryptocurrency in a lot of ways. Decentralized, based on a common algorithm (the design of the 1000 Shilling note), with a price eventually stabilizing on the mining (counterfeiting) cost.
> You have to incentivize and enable people in order to get them to change.
It's also possible the incentive will come by itself: if advocates of commodity money (money with an inflexible supply/stock) are right, inflation will occur in traditional currencies sooner or later. No better incentive to store your value in bitcoins than seeing the value you have in traditional currency slowly erode.
Time will tell whether this will be what introduces regular folks to cryptocurrency. If I were living in Argentina or Venezuela, it wouldn't take much convincing to get me to store at least part of my savings in cryptocurrency.
I figure cryptocurrencies work like collectibles, which also naturally deflate. Compare artworks or antiques or old wine.
What I've never quite understood is how those things align with investment. If I have $1000, can I predictably make more money by buying $1000 worth of art than $1000 worth of stock? If so, why? Buffet's "you can fondle the cube, but it will not respond" would seem to stand, but at the same time artworks and so on seem to only be getting more expensive.
If stuff gets cheaper to produce, and there's a fixed stock of money, I see no other outcome than deflation. In this case prices simply reflect that goods can be produced more efficiently.
So, if USD inflation is, say, 5% and bond yields also 5%, then you would indeed make no money by holding USD-denominated bonds. But I would argue the problem is with USD inflation in this hypothetical, since bonds also yielded 5% during the international gold standard and yet we had 2% deflation.
I would also argue that money is a sort of collectible; the only difference is that it's highly liquid. A painting might very well increase in value, but if you need to sell it quickly (as opposed to waiting six months for the right buyer) you can easily end up losing money -- if you can even find a buyer on short notice.
you're comparing a phone sms based payment method to bitcoin. you're missing the charactistic that gives it its killer use case: digital scarcity. the uncensored payment method on top of scarcity is just icing on the cake.
You have to incentivize and enable people in order to get them to change.
M-PESA and the similar mobile money telecom products are doing more for digitizing and disrupting fiat currencies than cryptocurrencies are currently. Bitpesa is having some success as a bridge between the two, but it's going to be a struggle for any cryptocurrency or token to surpass the usability of digital currencies tied to the devices they already use and th kiosks / storefronts around them.