Bitcoin Regulation and Game Theory
“How Countries Could Kill Bitcoin Adoption”
Link: https://bitcoinmagazine.com/culture/how-countries-could-kill-bitcoin-adoption
While generally written from an immature standpoint, the article delves into the various methods through which countries, or the world as a whole, could move to regulate against or stop the adoption of Bitcoin as an official, or normal, currency. Then, the article talks about how regulating against Bitcoin could in fact do the opposite of stopping its adoption – rather, encourage it. It discusses game theory, and how certain actors moving to regulate against cryptocurrency will only hurt themselves if others fail to follow suit, or how if there is regulation to encourage its adoption it could mutually benefit both countries. As an unregulated opinion piece, some of the author’s statements are rather weak and hard to justify, but overall, the article does a good point of discussing Bitcoin adoption from a game theory perspective.
This article relates to course materials by portraying countries and entities as an inter-connected network when it comes to the adoption of cryptocurrency. Using this, the author breaks down adoption and regulation of Bitcoin using game theory to show mutual benefit, mutual loss, and competitive strategies for different actors. He makes the case against regulation by saying that a complete lack of regulation is the best outcome, showing a Nash Equilibrium in which both actors benefit. While some of his arguments are weak, they break down into a perfect payoff structure to support his arguments.
