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Cash is the only payment method available today that is both distributed and truly censorship-resistant. Anyone can pay cash to anyone else in exchange for anyt

by kijin 11y ago

Cash is the only payment method available today that is both distributed and truly censorship-resistant. Anyone can pay cash to anyone else in exchange for anything, without having to report to, or obtain permission from, any third party. If nobody knows what you bought in the back alley last night, nobody will ever find out. You don't need fancy chunks of metal and plastic to use cash. You don't even need electricity, much less an internet connection, to use it. A three-year-old kid can use it just as well as one-hundred-and-three-year-old great-grandma. A lot of the time, you can't even tell whether the bills are genuine or not. But that doesn't prevent billions of people around the world from exchanging cash every day. And if dollars suddenly became untrustworthy, people will just switch to another currency or fall back to crates of fish and shiny stones. Compare that to cryptocurrencies that are being touted as the future of distributed, "censorship-resistant" cash. Sure, they're distributed, but censorship is as easy as cutting off the target's internet connection (or even blocking some ports). If you're a dictator in North Africa, just flip the switch and all the rebels are suddenly broke! Cryptocurrencies also require everyone to broadcast every transaction to the whole world, and all it takes is one mistake to connect a set of addresses to a real identity. Geeks can mix their coins and hope there's no trail left, but good luck getting grandma to use it correctly. Programmers love to talk about elaborate ways to prevent double-spending and whatnot. But in order to be a plausible replacement for cash, I think virtual currencies need to solve some of these usability problems first. Spending a few satoshis needs to become just as easy as pulling some quarters out of your pocket.

maxerickson 11y ago
What about barter? It's way less convenient than cash, but it is a distributed payment method that can at least be used in a way that is censorship resistant (many times the thing up for barter might make the transaction hard to hide, other times not).
- ctdonath 11y ago
  The whole point of money is it abstracts value from what is valued. Barter is laden with whether you want the thing, what you perceive as its value, and it's durability & transportability. A crate of raw tuna is quite valuable, but very hard to barter with. Some may be surprised to find ammunition & guns make for excellent cash substitutes, having a wide range of value in compact, durable, and self-protective form.
  - maxerickson 11y ago
    The whole point of saying it's way less convenient than cash was to avoid an explanation that it isn't exactly the same.
forgetsusername 11y ago
>Cash is the only payment method available today that is both distributed and truly censorship-resistant. The only widely-accepted currency with those properties. People are free to exchange anything for anything. You want to pay for something in blueberry scones? Go right ahead. The problem is finding someone to accept that payment. We use cash because it's convenient and has inherent value due to its ability to pay taxes. >but censorship is as easy as cutting off the target's internet connection Couldn't agree more. Cut off the internet, or refuse the sale of a cell phone or similar device and people will be forced to exchange their Bitcoins via pieces of paper. What a breakthrough.
elcapitan 11y ago
In a sufficiently trusted circle, you could probably just as well use a notion of debt instead of money or barter. Debt would be completely immaterial and virtual. This would work for villages or for groups with "multiple rounds" of encounter, in game-theory speak.
- noir_lord 11y ago
  Viewed from one aspect cash already is a transferable debt, it's why our currency says "I promise to pay the bearer on demand"
  - elcapitan 11y ago
    Exactly. Taking away cash and replacing it with debt again would basically just mean to replace the general trustee (the issuer of currency) with trust inside the group. Probably depends on the type of group and only works in relatively equal, non-competitive environments.
peter303 11y ago
The Fed automatically tracks serial numbers of $100s cycling through its system. Most 100s never see the inside of a bank a again unless they are spent at a merchant. Nothing prohibits other denominations, but they are less significant.
- pm24601 11y ago
  If the Fed tracks serial numbers of $100s ... but most 100s never see the inside of a bank.... then the tracking is useless for tracking your purchases. Therefore, cash is anonymous.
meanduck 11y ago
This is wrong. Cryptocurrencies can be freely exchanged with anyone, anywhere unlike Cash which is only censorship-resistant for the transactions done in person. Cryptocurrencies are more distributed in the sense that exchange rates are set by market not central banks. This means cryptocurrencies can have more permanent stability than cash. Though at the moment none of the cryptocurrencies do. But as the adoption increases so will stability.
- kijin 11y ago
  Cryptocurrencies are only censorship-resistant for people who can afford a secure and well-maintained computing device and whose internet connection cannot be arbitrarily blocked or filtered by governments and corporations. On today's Earth, this group of people is vastly smaller than the number of people who can carry out cash transactions in person, not just because of poor adoption, but because of a fundamental UX problem. Does it matter who sets the exchange rate when the more pressing concern is who controls your ability to participate in the network in the first place? You can set your own exchange rates, too, if you're really serious about it. It will be $10 for this wad of marijuana, not $15 like this other guy says, thank you very much.
  - meanduck 11y ago
    > Cryptocurrencies are only censorship-resistant for people who can afford a secure and well-maintained computing device https://en.bitcoin.it/wiki/Hardware_wallet https://en.bitcoin.it/wiki/Hardware_wallet > and whose internet connection cannot be arbitrarily blocked or filtered by governments and corporations. I am not aware of even one instance where bitcoin or anyother protocol has been successfully blocked. > On today's Earth, this group of people is vastly smaller than the number of people who can carry out cash transactions in person, not just because of poor adoption, but because of a fundamental UX problem. Yet. There is no reason why cant UX be n00b-friendly or may be it already is. Low adaption is probably due to either people are unaware or there is lot mis-information. Anycase, adoption is steadly increasing. > Does it matter who sets the exchange rate when the more pressing concern is who controls your ability to participate in the network in the first place? Its not. None can control participation. Thats why dark markets deal in bitcoin. > You can set your own exchange rates, too, if you're really serious about it. It will be $10 for this wad of marijuana, not $15 like this other guy says, thank you very much. Considering there are zillion laws regulating money flow between any given two parties, I doubt it would look as appealing as a widely-accepted crytocurrency.

by kijin 11y ago

maxerickson 11y ago

What about barter? It's way less convenient than cash, but it is a distributed payment method that can at least be used in a way that is censorship resistant (many times the thing up for barter might make the transaction hard to hide, other times not).

ctdonath 11y ago
The whole point of money is it abstracts value from what is valued. Barter is laden with whether you want the thing, what you perceive as its value, and it's durability & transportability. A crate of raw tuna is quite valuable, but very hard to barter with. Some may be surprised to find ammunition & guns make for excellent cash substitutes, having a wide range of value in compact, durable, and self-protective form.
- maxerickson 11y ago
  The whole point of saying it's way less convenient than cash was to avoid an explanation that it isn't exactly the same.

forgetsusername 11y ago

>Cash is the only payment method available today that is both distributed and truly censorship-resistant. The only widely-accepted currency with those properties. People are free to exchange anything for anything. You want to pay for something in blueberry scones? Go right ahead. The problem is finding someone to accept that payment. We use cash because it's convenient and has inherent value due to its ability to pay taxes. >but censorship is as easy as cutting off the target's internet connection Couldn't agree more. Cut off the internet, or refuse the sale of a cell phone or similar device and people will be forced to exchange their Bitcoins via pieces of paper. What a breakthrough.

elcapitan 11y ago

In a sufficiently trusted circle, you could probably just as well use a notion of debt instead of money or barter. Debt would be completely immaterial and virtual. This would work for villages or for groups with "multiple rounds" of encounter, in game-theory speak.

noir_lord 11y ago
Viewed from one aspect cash already is a transferable debt, it's why our currency says "I promise to pay the bearer on demand"
- elcapitan 11y ago
  Exactly. Taking away cash and replacing it with debt again would basically just mean to replace the general trustee (the issuer of currency) with trust inside the group. Probably depends on the type of group and only works in relatively equal, non-competitive environments.

peter303 11y ago

The Fed automatically tracks serial numbers of $100s cycling through its system. Most 100s never see the inside of a bank a again unless they are spent at a merchant. Nothing prohibits other denominations, but they are less significant.

pm24601 11y ago
If the Fed tracks serial numbers of $100s ... but most 100s never see the inside of a bank.... then the tracking is useless for tracking your purchases. Therefore, cash is anonymous.

meanduck 11y ago

This is wrong. Cryptocurrencies can be freely exchanged with anyone, anywhere unlike Cash which is only censorship-resistant for the transactions done in person. Cryptocurrencies are more distributed in the sense that exchange rates are set by market not central banks. This means cryptocurrencies can have more permanent stability than cash. Though at the moment none of the cryptocurrencies do. But as the adoption increases so will stability.

kijin 11y ago
Cryptocurrencies are only censorship-resistant for people who can afford a secure and well-maintained computing device and whose internet connection cannot be arbitrarily blocked or filtered by governments and corporations. On today's Earth, this group of people is vastly smaller than the number of people who can carry out cash transactions in person, not just because of poor adoption, but because of a fundamental UX problem. Does it matter who sets the exchange rate when the more pressing concern is who controls your ability to participate in the network in the first place? You can set your own exchange rates, too, if you're really serious about it. It will be $10 for this wad of marijuana, not $15 like this other guy says, thank you very much.
- meanduck 11y ago
  > Cryptocurrencies are only censorship-resistant for people who can afford a secure and well-maintained computing device https://en.bitcoin.it/wiki/Hardware_wallet https://en.bitcoin.it/wiki/Hardware_wallet > and whose internet connection cannot be arbitrarily blocked or filtered by governments and corporations. I am not aware of even one instance where bitcoin or anyother protocol has been successfully blocked. > On today's Earth, this group of people is vastly smaller than the number of people who can carry out cash transactions in person, not just because of poor adoption, but because of a fundamental UX problem. Yet. There is no reason why cant UX be n00b-friendly or may be it already is. Low adaption is probably due to either people are unaware or there is lot mis-information. Anycase, adoption is steadly increasing. > Does it matter who sets the exchange rate when the more pressing concern is who controls your ability to participate in the network in the first place? Its not. None can control participation. Thats why dark markets deal in bitcoin. > You can set your own exchange rates, too, if you're really serious about it. It will be $10 for this wad of marijuana, not $15 like this other guy says, thank you very much. Considering there are zillion laws regulating money flow between any given two parties, I doubt it would look as appealing as a widely-accepted crytocurrency.