The Downsides of Cryptocurrency

As with money itself, it often is hard to determine whether cryptocurrency is inherently good or bad; it depends on how it is used. 

Cryptocurrency often is said to offer the values of lower transaction costs; greater security; lower fraud exposure and possibly even categories of money that cannot be used for certain purposes, or by certain persons.

That might be either a tool for political suppression or liberty; safety or danger. Money that cannot be used in certain ways which might protect children. It could prevent some forms of money laundering and crime. 

It could just as easily be used by governments or groups to suppress political freedom and civil rights, as if a government-sanctioned or controlled crypto could be programmed to prevent certain types of spending by some individuals or groups. 

If we already see efforts to destroy the businesses or careers of people whose views are considered noxious (even if simply views one does not support) you can see where the temptation to do so using crypto features does exist. 

But crypto also raises other issues, including among them the most basic question of “what is money?” Can it function as a medium of exchange that--like all money--reduces transaction costs? There is the related issue of whether crypto also can function as a store of value like gold.  

Some believe cryptocurrencies could enhance financial system resiliency as well, in part by separating the lending function from other financial services including payments.  

And since micropayments are viewed as a feature of Web 3.0, there is a relationship between cryptocurrency and different Web monetization methods, including the ability to pay content creators. 

Eventually, thoughtful protections will be necessary to prevent the darker side of crypto from emerging in ways that attack civil liberties and human freedom.