KYC and the Game of Life

The article uses Conway’s Game of Life — an early artificial life simulation programme — to demonstrate the spread of bitcoin adoption. The writer makes the case that the days of KYC are numbered. His point is that, as bitcoin is used by more and more people, the proportion of bitcoin-to-bitcoin transactions compared to bitcoin-to-fiat transactions will increase. In other words, the more people who use bitcoin, the less need there is for fiat gateways and the accompanying KYC.

It’s a neat idea, if a little misguided. For one thing, fiat money isn’t going out of fashion. The regulatory picture has changed a lot since 2015, and it’s clear that there are always going to be points — and, in fact, an increasing number of points — where governments pay attention to money moved around on the blockchain. The world isn’t going to turn into one huge black or grey market.

But the number of crypto users is increasing and will continue to do so as real-world use cases progressively come online. That’s the real story of the Game of Life simulation here. Right now, crypto isn’t used much as a means of payment. It’s used as a store of value or investment — more like an equity stake in a startup than dollars or euros. But the more people use it as a currency, the faster that process will accelerate as network effect starts to take hold. And that is an exciting proposition: not for its KYC implications, but for the rise of new, decentralised currencies that run on maths rather than monetary policy. Whilst not entirely outside the remit of governments and regulators, their supply and economics are beyond their interference.

— — — — — — — — — — — — — — — — — —

Red hot news, scorching wit and searing opinion pieces from Crypto Inferno.

Related posts:

Like many other writers of this site, I was invited to join the Creator’s Program of NewsBreak. Though I was not sure about it, I decided to give it a try and was offered $1,000 per month if I would…

I want to start by presenting you with an amazing piece of statistics that keeps thrilling me every time I think about it. Have you ever thought what are the odds of a person, like me, or anyone else…

I found a white hair. Just a one. A short, bright, rebellious intruder, standing at attention front and center. Mocking me. You’re nearly forty, I heard it say. Soon there were others, crafty…