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Not to be the token cryptocurrency shill in the thread, but Bitcoin and its derivatives are very useful in situations like this. It's impossible to stop or othe

Not to be the token cryptocurrency shill in the thread, but Bitcoin and its derivatives are very useful in situations like this. It's impossible to stop or otherwise block Bitcoin transfers, so it enables, for better or worse, unrestricted capital movement.

JeremyBanks 10y ago
Even if your BitCoin are held by an investment vehicle..?
united893 10y ago
Not true. These are hedge funds managing complex instruments, not just regular bank accounts. Your bitcoin wallet doesn't allow shorting for example. Equivalent instruments built on blockchain technology would suffer from similar issues.
- drcross 10y ago
  >These are hedge funds managing complex instruments. How come it's only when it comes to matters of finance that people tell me things are too complex for me to understand, yet I am well capable of understanding the most convoluted of machinery and systems. My only conclusion is that they are needlessly complicated on purpose.
  - daveguy 10y ago
    Complex meaning not able to be liquidated with a single bitcoin or any other currency transaction. This is a specific asset that the fund administrators are not allowing to be liquidated. If you used bitcoin to buy these assets they would still be held outside of the bitcoin system. Just like when you use dollars/pounds/etc to buy the asset the wealth is no longer held in dollars/pounds/etc. They would be at least one step removed from the currency regardless. You couldn't liquidate immediately even if you bought into the mutual fund with bitcoin. The mutual fund would never be held in pure bitcoin because there are multiple assets -- other stocks, bonds, etc (e.g. complex). Complex as in not simple. Not complex as in you wouldn't understand.
  - tedunangst 10y ago
    It's not particularly complicated. But if you invest in a real estate fund and want your money back, you can't walk into some random office and take "your" chair. If you invest in a gold mine, you can't go grab "your" shovel. Your interest is diffuse.
spot 10y ago
unrestricted.... except for that pesky 7 transactions per second restriction.
- drcross 10y ago
  That's like saying cars are useless a hundred years ago because they were slower than horses.
  - daveguy 10y ago
    Its more like saying horses are useless today because they can't go 60 mph for hundreds of miles.
krajzeg 10y ago
It is also impossible to block you from moving cash you already have in your pocket. It is however very possible to refuse converting shares in a fund into real money, regardless of whether that money is cash or Bitcoin.
strathmeyer 10y ago
'multisig'
schoen 10y ago
It's not clear that that's very relevant to this situation: the investors here aren't clearly being confronted with government capital controls, but apparently with an enforced delay in liquidating an asset (enforced by the private party that holds the asset on the investors' behalf). This isn't the U.K. government saying "no investors may withdraw money from the U.K.", but U.K. financial industry entities saying "we won't agree to sell your assets and let you redeem your holdings in cash quickly at this time".
cesarb 10y ago
It wouldn't help in this case, since from what I understand most of the value in these particular funds is locked up in real estate. An example: you invest €1000 in one of these funds. It takes €900 of what you invested (keeping €100 in cash), pools it together with what other people invested in the fund, buys one floor of a building, and rents it to a company. What it receives in rent is what gives the fund its return (and might be reinvested in buying more floors). So, it's not a simple question of doing a transfer. The fund has to sell the building floors, a process which can take many months. If it has 100 investors, and only 2 or 3 want to get out, it can use what it kept as cash and pay them quickly; if 50 want out, it won't have enough cash in hand.

JeremyBanks 10y ago

Even if your BitCoin are held by an investment vehicle..?

united893 10y ago

Not true. These are hedge funds managing complex instruments, not just regular bank accounts. Your bitcoin wallet doesn't allow shorting for example. Equivalent instruments built on blockchain technology would suffer from similar issues.

drcross 10y ago
>These are hedge funds managing complex instruments. How come it's only when it comes to matters of finance that people tell me things are too complex for me to understand, yet I am well capable of understanding the most convoluted of machinery and systems. My only conclusion is that they are needlessly complicated on purpose.
- daveguy 10y ago
  Complex meaning not able to be liquidated with a single bitcoin or any other currency transaction. This is a specific asset that the fund administrators are not allowing to be liquidated. If you used bitcoin to buy these assets they would still be held outside of the bitcoin system. Just like when you use dollars/pounds/etc to buy the asset the wealth is no longer held in dollars/pounds/etc. They would be at least one step removed from the currency regardless. You couldn't liquidate immediately even if you bought into the mutual fund with bitcoin. The mutual fund would never be held in pure bitcoin because there are multiple assets -- other stocks, bonds, etc (e.g. complex). Complex as in not simple. Not complex as in you wouldn't understand.
- tedunangst 10y ago
  It's not particularly complicated. But if you invest in a real estate fund and want your money back, you can't walk into some random office and take "your" chair. If you invest in a gold mine, you can't go grab "your" shovel. Your interest is diffuse.

spot 10y ago

unrestricted.... except for that pesky 7 transactions per second restriction.

drcross 10y ago
That's like saying cars are useless a hundred years ago because they were slower than horses.
- daveguy 10y ago
  Its more like saying horses are useless today because they can't go 60 mph for hundreds of miles.

krajzeg 10y ago

It is also impossible to block you from moving cash you already have in your pocket. It is however very possible to refuse converting shares in a fund into real money, regardless of whether that money is cash or Bitcoin.

strathmeyer 10y ago

'multisig'

schoen 10y ago

It's not clear that that's very relevant to this situation: the investors here aren't clearly being confronted with government capital controls, but apparently with an enforced delay in liquidating an asset (enforced by the private party that holds the asset on the investors' behalf). This isn't the U.K. government saying "no investors may withdraw money from the U.K.", but U.K. financial industry entities saying "we won't agree to sell your assets and let you redeem your holdings in cash quickly at this time".

cesarb 10y ago

It wouldn't help in this case, since from what I understand most of the value in these particular funds is locked up in real estate. An example: you invest €1000 in one of these funds. It takes €900 of what you invested (keeping €100 in cash), pools it together with what other people invested in the fund, buys one floor of a building, and rents it to a company. What it receives in rent is what gives the fund its return (and might be reinvested in buying more floors). So, it's not a simple question of doing a transfer. The fund has to sell the building floors, a process which can take many months. If it has 100 investors, and only 2 or 3 want to get out, it can use what it kept as cash and pay them quickly; if 50 want out, it won't have enough cash in hand.