Former US Mint Chief: Bitcoin a Serious Challenge to Government Money

Edmund C. Moy, the former director of the US Mint — the government body responsible for producing the country’s physical coins, made waves in the bitcoin community this week when he took to Twitter to voice his enthusiasm for digital currencies.

Moy’s comments were issued in response to the most recent $2.6bn Credit Suisse settlement, in which the Switzerland-based banking giant pleaded guilty to helping clients evade taxes.

In light of this news, the 38th Director of the US Mint went so far as to suggest that digital currency could provide the answer to current problems in the financial system, writing:

$2.6B fine ‘won’t do much damage’: Credit Suisse CEO. It’s time banks got competition. Time for cryptocurrencies. http://t.co/OT3dBTDlrq

— Edmund Moy (@EdmundCMoy) May 22, 2014

However, Moy didn’t stop there. The former member of the Department of Homeland Security took to his blog on 23rd May to issue an entire post on how bitcoin is leading to “a revolution in payment systems”.

Moy wrote:

“Bitcoin, and the ideas behind it, will be a disruptor to the traditional notions of currency. In the end, currency will be better for it.”

The full post lightheartedly addressed bitcoin and its strengths and weaknesses, with Moy offering a perhaps surprisingly optimistic assessment of how the technology will impact the global financial marketplace.

Bitcoin removes government monopolies

Perhaps most notably, Moy suggested that digital currencies can even help prevent some of the more severe drawbacks associated with fiat currencies. In particular, he predicts it will eliminate what he views as the government monopoly on money, writing:

“It has a low risk of collapse unlike a sovereign government’s currency (just ask the Greeks or more broadly, the European Union).”

Moy acknowledged this as a positive, even if he realized the innovation would likely threaten his former employer.

He added: “You can mine your own bitcoins. No mint needed!”

Bitcoin an innovative means of exchange

Moy was also enthusiastic about bitcoin’s potential to offer a new way for global consumers to transact, stating:

“As a medium of exchange, bitcoin offers several unique innovations to currency: global nature, infinite divisibility and easy to carry.”

Calling today’s transaction systems “archaic”, he argued that bitcoin’s ability to divide effortlessly would allow for new methods of monetization via micropayments, and that it could eliminate existing barriers to global markets.

Bitcoin will be a safe store of value

Moy was equally positive about bitcoin as a store of value, saying that he believes bitcoin’s price will become more stable as it’s adopted by mainstream consumers.

However, he took aim at critics of the idea who believe that government-backed alternatives are perhaps more secure, saying that the US dollar is driven mostly by market demand.

As an added benefit, he theorized bitcoin could even allow governments the ability to dedicate more time to monetary policy that could positively impact their economies should it reach its full potential.

To read Moy’s full remarks, read his full post.

Image via EdMoy.com