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"Probably the biggest lever a government has on their nation is monetary policy. There is no way that a government would allow the subversion of that." This is

by mrb 9y ago

"Probably the biggest lever a government has on their nation is monetary policy. There is no way that a government would allow the subversion of that." This is a simplistic and wrong analysis. Governments care about the health of their economy, and as you said monetary policy is just one of many levers to influence that. Thus, if the cryptocurrency industry can help increase their economic wealth, they will not only allow it, but encourage the development of this industry and technologies. Case in point: various laws enacted or projects created by governments encourage blockchain/cryptocurrencies innovation & use: https://www.americanbanker.com/news/delaware-blockchain-measure-seeks-to-change-very-base-of-financial-system https://www.americanbanker.com/news/delaware-blockchain-meas... https://futurism.com/ethereums-founder-struck-a-deal-with-a-russian-bank-to-create-ethereum-russia/ https://futurism.com/ethereums-founder-struck-a-deal-with-a-... https://en.wikipedia.org/wiki/BitLicense https://en.wikipedia.org/wiki/BitLicense http://newmedialaw.proskauer.com/2017/04/20/arizona-passes-groundbreaking-blockchain-and-smart-contract-law-state-blockchain-laws-on-the-rise/ http://newmedialaw.proskauer.com/2017/04/20/arizona-passes-g... "So [China] went ahead and did what I have been suggesting would happen, but much earlier than I suspected." No. Your point would have been demonstrated if China had banned cryptocurrencies. However this is precisely what they did NOT do. They only banned ICOs. The Chinese government cares enormously about stability and public order. They saw plenty of ICO scams and unregulated markets causing people to lose fortunes—not good for stability and order—so they banned ICOs. China actually covets their position as a leader in Bitcoin and altcoins mining, so they are protecting their economic advantage by NOT banning cryptocurrencies. (Proving my point above.) "Blockchain is a perfect solution for many things, but as a currency it's dead on arrival IMO." Exactly the opposite. Currency, and store of value (went up 7×/19×/35× over last 12/24/48 months) are the 2 killer use cases for Bitcoin.

AndrewKemendo 9y ago
Governments care about the health of their economy Yes, so long as they are in control of it. If the Chinese people start doing significant number of transactions in x-coin and not in Yuan then they lose their largest lever of power. No. Your point would have been demonstrated if China had banned cryptocurrencies. They don't need to yet because the cryptos aren't big enough. What they did is put significant brakes on them to make sure they can manage and track the rise/growth through known intermediaries - which is exactly what they did. Banning them outright would have been too big of a move at this point and would have likely caused more instability than they wanted. China actually covets their position as a leader in Bitcoin and altcoins mining, so they are protecting their economic advantage by NOT banning cryptocurrencies. Chinese miners might, but the PnB certainly doesn't. In fact most of the big "Mines" are way outside of cities where they don't get much scrutiny. The PnB is probably looking to see if they can co-opt the situation, rather than let it run on it's own. I wouldn't put it past them to try and centralize it to make sure it falls under PnB purview - effectively having the same impact as making it parity with Yuan.
- mrb 9y ago
  "They don't need to yet because the cryptos aren't big enough" Your logic doesn't hold. ICOs are much smaller than cryptos. They banned the former, not the later. "Chinese miners might, but the PnB certainly doesn't." I take it you meant PBOC, not PNB. Well once again, a crypto outsider comes to tell us "governments will ban cryptos!" I have been hearing this critic for 7 years... But as I said, as we have seen over the last few years, the general attitude of governments toward cryptos has been the opposite: they have encouraged their development, they have let the exchanges operate, they have created regulation to bring some clarity in the market, etc. It is actually almost surprising to see the amount of positive attitude coming from specifically the USA, China, and Russia, to name a few. Even the former PBoc governor has explicitely stated he did NOT want to "kill" Bitcoin: https://themerkle.com/former-pboc-governor-we-need-to-regulate-bitcoin-rather-than-kill-it/ https://themerkle.com/former-pboc-governor-we-need-to-regula...

by mrb 9y ago

AndrewKemendo 9y ago

Governments care about the health of their economy Yes, so long as they are in control of it. If the Chinese people start doing significant number of transactions in x-coin and not in Yuan then they lose their largest lever of power. No. Your point would have been demonstrated if China had banned cryptocurrencies. They don't need to yet because the cryptos aren't big enough. What they did is put significant brakes on them to make sure they can manage and track the rise/growth through known intermediaries - which is exactly what they did. Banning them outright would have been too big of a move at this point and would have likely caused more instability than they wanted. China actually covets their position as a leader in Bitcoin and altcoins mining, so they are protecting their economic advantage by NOT banning cryptocurrencies. Chinese miners might, but the PnB certainly doesn't. In fact most of the big "Mines" are way outside of cities where they don't get much scrutiny. The PnB is probably looking to see if they can co-opt the situation, rather than let it run on it's own. I wouldn't put it past them to try and centralize it to make sure it falls under PnB purview - effectively having the same impact as making it parity with Yuan.

mrb 9y ago
"They don't need to yet because the cryptos aren't big enough" Your logic doesn't hold. ICOs are much smaller than cryptos. They banned the former, not the later. "Chinese miners might, but the PnB certainly doesn't." I take it you meant PBOC, not PNB. Well once again, a crypto outsider comes to tell us "governments will ban cryptos!" I have been hearing this critic for 7 years... But as I said, as we have seen over the last few years, the general attitude of governments toward cryptos has been the opposite: they have encouraged their development, they have let the exchanges operate, they have created regulation to bring some clarity in the market, etc. It is actually almost surprising to see the amount of positive attitude coming from specifically the USA, China, and Russia, to name a few. Even the former PBoc governor has explicitely stated he did NOT want to "kill" Bitcoin: https://themerkle.com/former-pboc-governor-we-need-to-regulate-bitcoin-rather-than-kill-it/ https://themerkle.com/former-pboc-governor-we-need-to-regula...