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The Guns of Bitcoin (2017)
- conanbatt 6y ago> American dollars have value because the US Government taxes things, like land, and if you do not pay those taxes they will send you mean letters (trust me) before resorting to other means (trust Al Capone) This is just plain wrong. Currencies have value themselves for their utility as a means of exchange, not because of taxes. This idea that raising taxes increases the value of a currency is bonkers.
- hansvm 6y agoIt's not "plain wrong." When minting a new currency you need a way to bootstrap it into being an accepted medium of exchange, and taxes help serve that purpose. They aren't the only method (and I'm not sure historically whether that was the case for the USD), but it isn't baseless.
- conanbatt 6y agoCurrencies existed well before governments minted them. Plus the dollar was once backed by gold: you can transition from a convertible system to a fiat system, which has nothing to do with fiscal policy.
- hansvm 6y agoThis reads like an argument, but it doesn't seem to contradict anything I said. Am I misinterpreting you? > Currencies existed well before governments minted them. Sure. Nevertheless, to accept a currency as a medium of exchange when it has no value to you personally (bank notes, gold, etc) you need to have confidence that you can exchange it to somebody else for something you do care about, regardless of who mints it. > Plus the dollar was once backed by gold: you can transition from a convertible system to a fiat system, which has nothing to do with fiscal policy. Yep. As stated, "[taxes] aren't the only method" to bootstrap a currency, and in practice transitioning from a gold backing to fiat seems to work smoothly (somehow...it's not hard to imagine an alternate reality where the public heard their dollars wouldn't be exchangeable for gold, the public lost faith in the dollar, and the dollar tanked as a result).
- conanbatt 6y agoAs far as I know, there is no currency that existed because there were taxes involved, and that's certainly not the experience of the major fiat currencies. In fact it might be otherwise: taxes are a deterrent to use currency, which is why barter is so often used by people and small businesses to avoid the tax-man today.
- natch 6y agoWow, app wall, that’s a new one. “Download the app or create an account to read.”
- gt2 6y agoSeen it. Most recently was trying to view a reddit on mobile. Said download the app or take a hike. Circumvented by doing 'request web view' option (in mobile safari)
- varbhat 6y agohttps://outline.com/VBSEgq https://outline.com/VBSEgq
- solids 6y agoYou can use something like https://getpocket.com/ https://getpocket.com/
- seibelj 6y ago> What makes dollars valuable is that the government wants them back. Very common misconception. Dollars have value because there is demand for them (governments, other governments, other people and institutions). Bitcoin also has value because there is demand for it. As does your house, expensive art, etc. Why does anything have value? Because someone else will pay your for it. I can say my pencil is worth $1 billion, but it doesn't really unless someone else will execute the trade.
- NetWorth16254 6y agoActually you wrong. Dolar has value, because even if no one will want dollar, government will buy it for dollar. It backed on government promise.
- dash2 6y agoNot sure if this is a joke? What does it mean to say the government will buy a dollar for a dollar?
- xerxesaa 6y agoYour argument sounds recursive. What does it mean to say the government will buy a dollar for a dollar? A dollar is only useful if it can be exchanged for things other than itself.
- streb-lo 6y agoI mean avoiding prison for tax evasion sounds pretty useful to me.
- munk-a 6y agoThat guarantee is sort of like the spark plug of the economy - because it exists (and because the US government was a thing) people initially believe in the value of a dollar (and the same thing happened with every currency) but the currency continues to have value (and has a value exceeding that initial US valuation) because other people will buy it as well. Also, just for a moment, the statement: "Dollar has value, because even if no one will want dollar, government will buy it for dollar." - that's a fair bit of nonsense, outside of the dollar having an exchange value the dollar has no value - fiat currency (and even precious metals TBH) only have value to to the continued demand for them and if that demand falters or if people stop valuing a dollar at as many whoppers as it used to be valued - then bad things start to happen really fast and the government is pretty powerless to stop it once it starts.
- varbhat 6y agohttps://outline.com/VBSEgq https://outline.com/VBSEgq Read without annoying app/account wall
- rboyd 6y agotired old arguments
- atemerev 6y agoWell it is possible to pay some (municipal-level) taxes in Switzerland in Bitcoin. That’s a start. As for the guns — how about, say, using Bitcoin in lieu of dollars for petroleum and other import-export settlements? You can’t sanction Bitcoin, you know.
- louwrentius 6y agoI would like to see a total ban/block of any kind of cryptocurrency articles on HN. I'm happy to include my own, if that's what it takes. https://louwrentius.com/cryptocurrencies-are-detrimental-to-society.html https://louwrentius.com/cryptocurrencies-are-detrimental-to-...
- coinward 6y agoyou want to censor discussion around a promising technology. why?
- shobith 6y agoI guess you can make a case for the neo-luddites
- beachjpg 6y agoBitcoin is not really liked on HN. I'm guessing most of the older HN guys don't seem really interested in the tech or is terrified by the price action, perhaps
- Sschellbach 6y agoI'm on HN. I like Bitcoin. Surely, I am not alone
- xur17 6y agoYou are not. I will say, the general consensus seems to be negative, but I wouldn't say it's disliked by all.
- shpongled 6y agoThe idea of something being outside the control of the Nanny state terrifies them. One of his primary arguments is that cryptocurrencies "facilitate crime".
- coinward 6y ago
- SuoDuanDao 6y agoWhat are the guns of bitcoin? In answer I point to is its network. People who are willing to take payment in bitcoin are different from the general population. It's a club many desire to join.
- Bishop_ 6y agoPeople using pine wood for flooring to spite the king for claiming it is probably the most American thing I have ever heard of.
- tossAfterUsing 6y agoPine floors are terrible to maintain though. 'cut off your nose to spite the king'
- Bishop_ 6y agoPeople have done worse for less, a specific parallel to current events should come to mind. In any case i'll remove pine floors from my diy tiny house project checklist.
- tossAfterUsing 6y agoimo, as a builder of one, tiny house has such a low squarefootage that you can spring for high quality materials without breaking the bank. it's easy enough to find 200sqft (that's a 20' cargo container's worth) of high quality unmatched leftover flooring from a sale.
- gruez 6y ago>Pine floors are terrible to maintain though. Why? Is it the sap?
- dirtyoldmick 6y agoThey are soft and get dents and such pretty easily.
- LgWoodenBadger 6y agoPine is a very soft wood. Some you can dent with a pencil. Our dining table was like that when I was a kid. You could see all sorts of writing in it from too much pencil pressure when doing homework.
- monokh 6y agoThe common mistake is to try to compare Bitcoin to a predefined experience of money. Bitcoin's value is multifaceted. From a very simplistic perspective, it can be compared to gold. Things get more interesting when you value aspects such as it being: - Fully digital - Verifiable by the common individual - Sent and received with no interference from third parties - Free from supply emission increases or control Each of these is especially hard to come across in any other form of money. Combining them is unprecedented.
- 1996 6y agoAlso, add the open source part meaning everyone can audit how it works and fork it if needed, and the network effects preventing said forks. Being protected from double spend or 51% attacks by having everybody in the world cooperate, because it is in their own selfish interest to do so, is indeed unprecedented. The current price seems extremely undervalued. I believe it is due to factoring-in the legal risks for when government realize a currency they can't control (block people they don't like, see eurodollars) or inflate at will (regardless of the reason, good or bad, it's about control) is a threat that must be legislated away.
- munk-a 6y agoGold is a very good comparison (especially since it is inherently pretty worthless much like bitcoins) but I think the core currency quality it has is the limit of supply. One of the more amusing qualities of the fallout world to me was always the usage of bottle caps as a currency. Oh sure we have a pretty much infinite supply now but in a post-war setting it's a relatively common material (we don't use rhodium for currency because it's rare in absolute terms and also very hard to come by) that isn't going to increase in volume - that said more recent games have under cut that with the sheer commonality of nuka cola, and it also seems like a rather easy currency to forge per the volume it takes to transact an exchange. The other points you mentioned are what's really interesting to me, the verifiable property is one that physical currency has struggled with for a long term and the ledger aspect has no equivalence in physical currency exchange[1] - it's really neat! 1. Except, of course, for my most favorite currency ever the Rai stones https://en.wikipedia.org/wiki/Rai_stones https://en.wikipedia.org/wiki/Rai_stones which are essentially a built-in fiat currency that no one ever actually counts or carries but instead the ownership was/is tracked entirely by oral history which is amazing.
- scottmsul 6y agoWhat's going to stop me from using bitcoin for everything, and then exchanging some into dollars at the last second to pay my taxes?
- Proven 6y agoNothing, but everyone quickly figures out they would be better off if they exchanged BTC for USD (or other national currency) before tax season when almost everyone must sell BTC for USD.
- null0pointer 6y agoNothing, really. Except that it would be a taxation nightmare, since every time you spend some you need to report the difference in price between when you acquired it and when you spent it, and pay tax on the gain/loss. It would also be a lot of effort to find people willing to accept bitcoin for things like groceries.
- tripletao 6y agoNothing, but if I earn $1 on January 1 and anticipate 30% tax on that due April 15, saving $0.30 guarantees that I can pay that debt. If I earn 1 mBTC on January 1 and save 0.3 mBTC, then that might be worth much more or less than my tax liability come April 15. The tax argument for the value of USD is because people have future debts denominated in USD (taxes), and they become aware of the amount of those debts in USD before those debts are due. If those people want an asset perfectly matched to that future liability, then they want USD. The demand is from that saving period, not the actual payment (which you correctly note is brief, just however long the transaction would take). Most discussions either express this distinction unclearly or miss it altogether, including the linked article.
- solotronics 6y agoThere are already initiatives to pay taxes directly in Bitcoin. https://bitcoinmagazine.com/articles/why-ohios-state-treasurer-backs-decision-accept-btc-tax-payments https://bitcoinmagazine.com/articles/why-ohios-state-treasur... This isn't some fringe idea it is being developed by governments around the US. I remember reading about some city in America that will take Bitcoin directly for tax but I can't find the article.
- coinward 6y agofull decentralization and seizure-resistance work as good guns against state tyranny
- rlucas 6y agoThat is orthogonal to the point of the article. The state can demand, using their guns, that you pay them in the coin of their realm. At that point, you need to come up with those coins, or face their guns. You can have your BTC be decentralized and seizure-resistant at that point, but that will not stop the Leviathan from jailing or killing you. The "guns" of the article are the actual guns of the IRS.
- coinward 6y agoDo the IRS really carry guns? The man-power needed and costs to enforce collection of coins means this doesn't scale well for the state
- inscionent 6y agoThey have guns and a yearly budget of US$1.2 billion https://en.wikipedia.org/wiki/IRS_Criminal_Investigation https://en.wikipedia.org/wiki/IRS_Criminal_Investigation
- WorldMaker 6y agoThey are notorious for "always" catching their criminals, too. Local law enforcement of many stripes in multiple states tried to catch Capone, but in the end it was the Revenuers that caught Capone on tax evasion.
- Sschellbach 6y agoFor every Capone there are thousands of people you never heard of successfully evading taxes
- ed25519FUUU 6y agoThe article makes a lot of good points. I think people put way too much stock into the government not being able to regulate digital currencies. Besides the obvious technical advantages of a state power, they can simply create policy that turns people into criminals if they intentionally answer questions wrong on their tax returns.
- Acrobatic_Road 6y agoI think the guns of bitcoin are it's decentralized design backed by the lobbying of domestic forces (The EFF, ACLU, exchanges, etc)
- beervirus 6y agoSince when does Medium require an account to read articles? Guess I'm not gonna read this one.
- Shared404 6y agoIt's an interesting article and worth a read. Here's an outline link from elsewhere in the thread. https://outline.com/VBSEgq https://outline.com/VBSEgq
- paulpauper 6y agoyaaawn. this article is full of tired arguments. Bitcoin is a lot more like gold than a competitor to the US dollar or substitute for cash.