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>> but fiat money markets are many times more transparent than bitcoin markets. How so? When the Fed creates money out of nothing and engages in so-called 'ope

>> but fiat money markets are many times more transparent than bitcoin markets. How so? When the Fed creates money out of nothing and engages in so-called 'open market operations': - Who brokers these deals? - Do they get a commission on those deals? What percentage? - When the Fed buys bonds/debt from the government through those brokers, who gets their hands on the credit when the government spends it? Is it the same corporations who get all the big government contracts (e.g. Palantir, IBM, Oracle...)? - What do the corporations who get all the big government contracts and subsidies do with that money? Stock buybacks? If so, isn't this the same as if the government just gave the money to corporate shareholders directly? I don't think I've ever met someone who could answer these questions. Certainly less than 0.1% of the holders of the currency can so how can we say that it's transparent?

jondubois 8y ago
Also, there is a big difference between manipulating the apparent value of a currency by using real funds to temporarily generate artificial spikes in supply or demand versus manipulating supply by creating new funds out of thin air. The former entails risk, the latter does not.
notahacker 8y ago
A trivial amount of research would answer your questions. Open market operations are conducted from the trading desk of the Federal Reserve Bank of New York, buying bonds through primary dealers listed on its website which fulfil the solvency requirements for buying and selling millions in securities at short notice. But anyone can buy and sell government bonds on regulated secondary markets (for that matter individuals can also buy Treasury securities direct) The equivalent question with regard to crypto is who "mines" the BTC and what rate do they pay for electricity. Good luck getting systematic information on that... I'm not sure why you decide to conflate the orthogonal issue of how the government spends funds it debt-finances, but government spending is unusually well documented, especially compared with "how crypto miners spend their profits". And corporations which get big government contracts use the funds they have paid to deliver the services paid for under the contract, with what is left over being profit for the firm to see fit (I thought cryptolibertarians liked capitalism!) Obviously giving the money to shareholders will not have the same effect as the shareholders do not have the capacity to deliver fighter jets, manpower, software or toiletries. The intricacies of how money is created are is not widely understood, but I don't think many cryptocurrency users can audit blockchain code, name the largest actors in mining or evaluate whether rates on exchanges are being manipulated by wash trades either.

jondubois 8y ago

Also, there is a big difference between manipulating the apparent value of a currency by using real funds to temporarily generate artificial spikes in supply or demand versus manipulating supply by creating new funds out of thin air. The former entails risk, the latter does not.

notahacker 8y ago

A trivial amount of research would answer your questions. Open market operations are conducted from the trading desk of the Federal Reserve Bank of New York, buying bonds through primary dealers listed on its website which fulfil the solvency requirements for buying and selling millions in securities at short notice. But anyone can buy and sell government bonds on regulated secondary markets (for that matter individuals can also buy Treasury securities direct) The equivalent question with regard to crypto is who "mines" the BTC and what rate do they pay for electricity. Good luck getting systematic information on that... I'm not sure why you decide to conflate the orthogonal issue of how the government spends funds it debt-finances, but government spending is unusually well documented, especially compared with "how crypto miners spend their profits". And corporations which get big government contracts use the funds they have paid to deliver the services paid for under the contract, with what is left over being profit for the firm to see fit (I thought cryptolibertarians liked capitalism!) Obviously giving the money to shareholders will not have the same effect as the shareholders do not have the capacity to deliver fighter jets, manpower, software or toiletries. The intricacies of how money is created are is not widely understood, but I don't think many cryptocurrency users can audit blockchain code, name the largest actors in mining or evaluate whether rates on exchanges are being manipulated by wash trades either.