The Bitcoin community needs to get its act together and step up to the plate? Why? Bitcoiners can persuade the world's most powerful monopoly of force to tolerate a challenge to the most valuable monopoly it enforces? I don't think so. States will crush Bitcoin, or co-opt it, if they can. The only question is: can states crush Bitcoin?

I don't expect Bitcoin 1.0 to be the last word in crypto-currencies for reasons I've discussed here, but satisfying state regulators is no solution to its problems. If stateless money ever predominates anywhere, it will predominate only because states could not prevent it. Stateless money will always be black market money. Stateless money will predominate over state money in the market generally when the market generally is black.

I don't see the problem.

It used to be I would have to buy dollars to send you, and you would have to sell those dollars to get pesos. We would not be using the dollars as a medium of EXCHANGE, as the dollars will not facilitate your purchase of anything. Rather we are using the dollars as a yardstick (and the ForEx system as a money transmitter). Money launderers use bitcoin as a yardstick and MTGOX and the rest as money transmitters.

Bitcoin get their value from their interchangeability. If we use different brokers, then the price at my broker and the price at your broker have to be the same. Therefore, to handle a transaction of a certain size (or a certain volume of non-instantaneous transactions) a broker must have a certain amount of bitcoin. Otherwise, all of the big deals will have to go to the biggest holder. The competition to have enough bitcoin to be in the brokerage business creates the demand for Bitcoin. They are taxi medallions for money, franchises, nothing more. And the brokers who buy them to facilitate transactions are money transmitters.

Should the recipient of Bitcoin "deposit" them in their e-wallets, and the operator of the e-wallet is allowed to use those deposits on a fractional reserve basis to issue Bitcoin certificates, Bitcoin may become money, at which time all sorts of banking regulations would come into play. But until then, Bitcoin are licenses to transmit money, and the agencies that trade in them are as pure an example of money transmitters as any regulator could hope.

I'm not personally too much against public issues of paper money to finance extraordinary wartime expenditures. Inflation is a fairly equitable form of taxation on wealth. I've read a few similar opinions from around the early post-Revolutionary period, shared by some of my home-town Philadelphians of the era.

Early financial and banking history in the US is positively fascinating. It is, I think, an area that the Modern Free Banking School could afford to concentrate more on. The way that banking was originally enclosed into an exclusive power of legislatively chartered corporations is something I know a little about but something I could always learn more of. Not being a scholar, my access to resources on the subject is, unfortunately, limited. Besides the personal interest I have, studying early, pre-'free banking' era banking in New England could be incredibly valuable because, in many ways, the situation there and then was more 'free banking' than the subsequent period. New England legislatures were much more liberal with their granting of charters than other states, to the point where the situation almost approximated free entry, and the chartered banks of the period were FAR less regulated than those of the bond-substitution, unit banks of the 'free banking' era.

New England was also, coincidentally, the most economically dynamic, developed region of the US in this period.

You should read Washington Irving's essay "The Mississippi Bubble" about John Law and France in the 1720's. Written in 1820, Irving offers brilliant monetary theory in beautifully written prose.

From now on, his name is Ludwig Bone Mrs.

I know nothing of anthropology, but if Graeber really is a leading figure, then I'm skeptical of that field, too. Debt was both tedious and sloppy; I lost count of the references to personal and second-hand anecdotes. The politicized battle over Chagnon's work does not inspire confidence, either.