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How is it irrelevant? You can buy Bitcoin with yuan, transfer the bitcoin to a foreign exchange, and then buy another currency like the US dollar with the bitco

How is it irrelevant? You can buy Bitcoin with yuan, transfer the bitcoin to a foreign exchange, and then buy another currency like the US dollar with the bitcoin, thereby circumventing capital controls.

JumpCrisscross 9y ago
> thereby circumventing capital controls You can also invoice hundreds of millions in fake orders. This is how the bulk of exfiltration occurs. Addressing the rounding error before the bulk means other concerns are at work. I am ignoring, in this argument, that recent policy—preceding these orders—calls for more capital export, to keep down the yuan.
- dannyw 9y ago
  The difference I think is that bitcoin allows someone with no connections to bypass capital controls. I'm not saying bitcoin isn't a rounding error, I'm sure other priorities (like ICO scams) are at work, but that might be another point.
  - jogjayr 9y ago
    But someone with no connections would presumably not have that much capital to move either, right? They'd not move much volume even if they bypassed capital controls.
    - dx034 9y ago
      It can be dangerous though. If suddenly several million citizens start transferring small amounts you can easily get outflows of several billion USD a month. Done by a few that would be an amount easily noticed.
WhoIsSatoshi 9y ago
How do you buy the bitcoins without the state tracking you? FYI the US is doing that also, you cannot buy on coinbase without providing ID... they want to be able to track big buyers.
- rblatz 9y ago
  You could mine, even if it was unprofitable. Spending 10 million in mining costs to produce $5million in bitcoin is still a win for a lot of people trying to move money out of China.
  - lifeisstillgood 9y ago
    Does that work - I think the mining reward is 25 BTC, about 75,000 USD. So for 7.5million thats being the winning miner 100 times. I honestly don't know what setup it takes to be reasonably certain to be the winning miner these days - does anyone have stats on how many miners and how often one might be expected to "win"?
    - lmm 9y ago
      The stats don't really matter, because the market is designed to equilibrate the price: it costs 7.5 million to mine 7.5 million's worth (in expectation, net present value and all that), and always will. If you're worried about reducing your variance you can join a pool rather than mining directly.
      - Nursie 9y ago
        But over what time period?
        corysama 9y ago
        There was an article posted a few weeks ago about a large Chinese mine that was doing $200K/day.
        Nursie 9y ago
        Sure, and that's a lot, I'm just wondering if there's anything approaching a investment->return timescale. Not that it really matters! It's not like I have a few mil hanging around looking for something to do...

JumpCrisscross 9y ago

> thereby circumventing capital controls You can also invoice hundreds of millions in fake orders. This is how the bulk of exfiltration occurs. Addressing the rounding error before the bulk means other concerns are at work. I am ignoring, in this argument, that recent policy—preceding these orders—calls for more capital export, to keep down the yuan.

dannyw 9y ago
The difference I think is that bitcoin allows someone with no connections to bypass capital controls. I'm not saying bitcoin isn't a rounding error, I'm sure other priorities (like ICO scams) are at work, but that might be another point.
- jogjayr 9y ago
  But someone with no connections would presumably not have that much capital to move either, right? They'd not move much volume even if they bypassed capital controls.
  - dx034 9y ago
    It can be dangerous though. If suddenly several million citizens start transferring small amounts you can easily get outflows of several billion USD a month. Done by a few that would be an amount easily noticed.

WhoIsSatoshi 9y ago

How do you buy the bitcoins without the state tracking you? FYI the US is doing that also, you cannot buy on coinbase without providing ID... they want to be able to track big buyers.

rblatz 9y ago
You could mine, even if it was unprofitable. Spending 10 million in mining costs to produce $5million in bitcoin is still a win for a lot of people trying to move money out of China.
- lifeisstillgood 9y ago
  Does that work - I think the mining reward is 25 BTC, about 75,000 USD. So for 7.5million thats being the winning miner 100 times. I honestly don't know what setup it takes to be reasonably certain to be the winning miner these days - does anyone have stats on how many miners and how often one might be expected to "win"?
  - lmm 9y ago
    The stats don't really matter, because the market is designed to equilibrate the price: it costs 7.5 million to mine 7.5 million's worth (in expectation, net present value and all that), and always will. If you're worried about reducing your variance you can join a pool rather than mining directly.
    - Nursie 9y ago
      But over what time period?
      - corysama 9y ago
        There was an article posted a few weeks ago about a large Chinese mine that was doing $200K/day.
        Nursie 9y ago
        Sure, and that's a lot, I'm just wondering if there's anything approaching a investment->return timescale. Not that it really matters! It's not like I have a few mil hanging around looking for something to do...