5 ms·

It's no different than bearer bonds [1]. "Utterly worthless" is a little strong; while for 99% of users, it's arguably inferior to a banking authority than can

It's no different than bearer bonds [1]. "Utterly worthless" is a little strong; while for 99% of users, it's arguably inferior to a banking authority than can restore your assets in the event of fraud, there are those that would consider this a feature rather than a bug, since it also means that a government or bank can't seize your assets either (given sufficient precautions, etc). It's a tradeoff, like so many things. [1] https://en.wikipedia.org/wiki/Bearer_bond https://en.wikipedia.org/wiki/Bearer_bond

arcticbull 6y ago
> It's arguably inferior to a banking authority than can restore your assets in the event of fraud, there are those that would consider this a feature rather than a bug, since it also means that a government or bank can't seize your assets either (given sufficient precautions, etc). And they would be wrong, since all crypto is priced in USDT which is a fiction brought to you by the Bitfinex team. Obviously the government should be able to seize funds, because you know, crimes. Somehow they seem to actually manage to seize bitcoin from time to time, too. So I'm not really even sure that's an argument. I guess if you lose it there's nothing to seize, like 20% of BTC so far.
- lukifer 6y ago
  Yes, it takes some precautions to make crypto unseizable (sufficient encryption and/or brainwallets). Even then, governments always have the "$5 wrench" option, in which they hold you in contempt and jail you for not turning over a password they believe you have. Still, for better or worse, a crypto-asset is a tool that can be used to store value that is purely under your control. Whether that's a good thing, or even should be a socially permissible thing, is certainly an open question.
cortesoft 6y ago
Yeah, and bearer bonds no longer exist because of those problems.
arcticbull 6y ago
From the wiki: "Bearer bonds have historically been the financial instrument of choice for money laundering, tax evasion, and concealed business transactions in general" Ah good! That, but digital. Just what the world needed. I almost feel like you made my case just there.
- elil17 6y ago
  "I don't like the use case" is different than "useless."
  - arcticbull 6y ago
    Ok, then it's great for crime, and nothing else.
    - elil17 6y ago
      And low fee transactions
      - arcticbull 6y ago
        Low fees aren't a feature of cryptocurrencies, I'm not sure the big websites even list it as such because: (1) Fees are irrelevant in the face of overwhelming volatility. Who cares if the fee is a couple of cents on your million dollar transaction when BTC regularly flings up and down 10%, or more? How could you willingly risk $100,000 on a million dollar transaction when your bank would charge you between $25 and $0 depending on your account size for the same transfer? (2) Fees only appear low because nobody's using it. The minute people start using it, as we've seen, the fees absolutely skyrocket. BTC transaction fees hit $35 last time around. (3) Fees only appear low because they're being socialized through inflation/dilution. A single BTC transaction consumes 700kWh of power -- enough to drive a Tesla from SF to New York. That's currently being absorbed by the system in the form of inflation/dilution ("block rewards"). But make no mistake, each transaction actually costs about $0.08/kWh in China = $56. (4) Fees for traditional currency are really low. Really, really low. Cash is free to hand to someone. Checks are free. ACH costs your bank 1/10th of 1 cent per transaction, and often that's passed along free of charge (see Venmo, Square Cash). Even wires are a few pennies in bulk, and often free -- my bank doesn't charge me for wires. (5) Before you start on international transactions, those are really really cheap too. The cheapest option for small transactions is TransferWise, charging 0% on the USD-INR corridor up to 0.85% or so. Most credit cards charge nothing on forex. If you're doing big transactions, InteractiveBrokers is a great bet for forex. On monthly transactions under 1,000,000,000 (that's right, a billion dollars) they charge 2/10th of a basis point - 0.002% -- minimum $2. $20 per million. SIPC insured. There's nothing the traditional BTC/ETH/etc cryptos do better than existing systems except crime. The forex market is $5.1T/year, trust me. It's been optimized.

arcticbull 6y ago

> It's arguably inferior to a banking authority than can restore your assets in the event of fraud, there are those that would consider this a feature rather than a bug, since it also means that a government or bank can't seize your assets either (given sufficient precautions, etc). And they would be wrong, since all crypto is priced in USDT which is a fiction brought to you by the Bitfinex team. Obviously the government should be able to seize funds, because you know, crimes. Somehow they seem to actually manage to seize bitcoin from time to time, too. So I'm not really even sure that's an argument. I guess if you lose it there's nothing to seize, like 20% of BTC so far.

lukifer 6y ago
Yes, it takes some precautions to make crypto unseizable (sufficient encryption and/or brainwallets). Even then, governments always have the "$5 wrench" option, in which they hold you in contempt and jail you for not turning over a password they believe you have. Still, for better or worse, a crypto-asset is a tool that can be used to store value that is purely under your control. Whether that's a good thing, or even should be a socially permissible thing, is certainly an open question.

cortesoft 6y ago

Yeah, and bearer bonds no longer exist because of those problems.

arcticbull 6y ago

From the wiki: "Bearer bonds have historically been the financial instrument of choice for money laundering, tax evasion, and concealed business transactions in general" Ah good! That, but digital. Just what the world needed. I almost feel like you made my case just there.

elil17 6y ago
"I don't like the use case" is different than "useless."
- arcticbull 6y ago
  Ok, then it's great for crime, and nothing else.
  - elil17 6y ago
    And low fee transactions
    - arcticbull 6y ago
      Low fees aren't a feature of cryptocurrencies, I'm not sure the big websites even list it as such because: (1) Fees are irrelevant in the face of overwhelming volatility. Who cares if the fee is a couple of cents on your million dollar transaction when BTC regularly flings up and down 10%, or more? How could you willingly risk $100,000 on a million dollar transaction when your bank would charge you between $25 and $0 depending on your account size for the same transfer? (2) Fees only appear low because nobody's using it. The minute people start using it, as we've seen, the fees absolutely skyrocket. BTC transaction fees hit $35 last time around. (3) Fees only appear low because they're being socialized through inflation/dilution. A single BTC transaction consumes 700kWh of power -- enough to drive a Tesla from SF to New York. That's currently being absorbed by the system in the form of inflation/dilution ("block rewards"). But make no mistake, each transaction actually costs about $0.08/kWh in China = $56. (4) Fees for traditional currency are really low. Really, really low. Cash is free to hand to someone. Checks are free. ACH costs your bank 1/10th of 1 cent per transaction, and often that's passed along free of charge (see Venmo, Square Cash). Even wires are a few pennies in bulk, and often free -- my bank doesn't charge me for wires. (5) Before you start on international transactions, those are really really cheap too. The cheapest option for small transactions is TransferWise, charging 0% on the USD-INR corridor up to 0.85% or so. Most credit cards charge nothing on forex. If you're doing big transactions, InteractiveBrokers is a great bet for forex. On monthly transactions under 1,000,000,000 (that's right, a billion dollars) they charge 2/10th of a basis point - 0.002% -- minimum $2. $20 per million. SIPC insured. There's nothing the traditional BTC/ETH/etc cryptos do better than existing systems except crime. The forex market is $5.1T/year, trust me. It's been optimized.