Thursday, 24 September 2020

George Washington used bitcoin, Alan Greenspan says

Who’s the first person that comes to mind when you think about bitcoin?
For Alan Greenspan, the former Federal Reserve chairman, it’s George Washington.

Greenspan, who said he is in the process of co-writing a book on American history, said bitcoin is just the latest version of the currency used to finance the Revolutionary War. These notes were called Continentals and had no backing in gold or silver. Greenspan made the connection in an interview on CNBC on Wednesday.

First issued in 1775 to the tune of about a couple of hundred million dollars, by 1782 Continentals were worthless, Greenspan said.

“Before it was worthless, George Washington was able to buy a lot of armaments, [and pay] basically all sorts of troop costs,” Greenspan said.

Bitcoin BTCUSD, +7.65% was up some 8% near midday Wednesday, nearing $13,000 for the first time. So far in 2017, it’s up more than 1,200%.

So will be bitcoin ultimately be worthless? Not necessarily. It depends on the future supply. In the case of Continentals, the amount of currency just kept rising, in part because they were easily counterfeited.

Greenspan is not surprised that cryptocurrencies are popular.

“Human beings buy all sorts of things that aren’t worth anything, but they do it anyway,” he said.

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“You cannot tell me that you can create, out of nothing, something which has a medium of exchange value without bringing into the analysis the fact that sometimes people are a little bewildered,” he said.

“That does not mean it will not trade,” he added.

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