6 ms·

No, the biggest promise of crypto is that you don't need to trust a third party (wether, govt., bank or your neighbour) to verify a transaction between two part

by chunky1994 6y ago

No, the biggest promise of crypto is that you don't need to trust a third party (wether, govt., bank or your neighbour) to verify a transaction between two parties as valid and that somebody didn't just give you counterfeit digital coins (i.e it solves the double spending problem). That's pretty much it. Everything else in a crypto economy is built on top of that as an analogous structure to regular physical currency/digital currency verified by a third party (i.e fiat) economy. Not needing a third party to verify the authenticity of digital transactions does not automatically make you immune to regulation. In very specific situations (i.e failed states undergoing civil war), if you lose the trust in your entire govt. you can now reliably still trade digital currency without it necessarily being backed by a third party, however everyone you are transacting with must buy into three things: 1) This new digital currency is now the dominant currency. 2) Everyone trades goods and services based off of this new currency 3) People outside your country respect that everyone inside the country values this at some specific value and honours trade in that currency. It is extremely unlikely you can convince anybody outside a country of (3) without some intervening international body, so the "crypto economy" replacing currency to fight an authoritarian regime is practically never going to happen. With regards to the article. Ultimately, if you trust your government to in general protect you, this is a good thing. If you don't trust your govt. to do so, this framework is a bad thing.

idolaspecus 6y ago
> It is extremely unlikely you can convince anybody outside a country of (3) without some intervening international body, so the "crypto economy" replacing currency to fight an authoritarian regime is practically never going to happen. Could anti-authoritarian outsiders use (3) to effectively support anti-authoritarian insiders?
- judge2020 6y ago
  The "people" in (3) refers less to the working class than it does to people in power that control and contribute to large percentages (>0.5%) of a country's GDP/wealth (unless nearly all of the working class within a country recognizes it).
  - deleted 6y ago
    [deleted]
- chunky1994 6y ago
  Not sure why this question is being downvoted, but possibly. However this is fraught with various complications and is a discussion around failed state govts.' regime enforcement, internal citizenries' access to external organizations and various other ways in which other economic actors interact with these, a very complex separate discussion on its own and it requires one too many assumptions for me to be comfortable providing any intelligent opinion on without starting from a common base of assumptions.
lawn 6y ago
Another benefit with cryptocurrencies is that nobody's allowed to control the supply, so you escape the inflation heavy fiat money we use today.
- arcticbull 6y ago
  The supply is controlled solely by a group of random, un-elected, un-accountable to anyone, GitHub contributors. If the Bitcoin Dev Team wanted, they could up the number of coins. Arbitrarily. Without recourse. What are you going to do, fork it? Further, the massive, overwhelming breakage due to the user-hostile nature of cryptocurrencies has led to staggering deflation. 20% is gone already [1]. Finally, the worst part is that the Bitcoin wealth distribution is worse than any banana republic; 0.00088% of addresses control 17.5% of all coins. 4.11% of addresses control 96.53% of coins. [2] Unless you're a whale, you're fighting for scraps today, and the next generation of market participants will be basically serfs. Deflation and breakage exaggerate this problem. If you thought letting them eat cake was bad... [1] https://www.investopedia.com/news/20-all-btc-lost-unrecoverable-study-shows/ https://www.investopedia.com/news/20-all-btc-lost-unrecovera... [2] https://howmuch.net/articles/bitcoin-wealth-distribution https://howmuch.net/articles/bitcoin-wealth-distribution
  - lawn 6y ago
    The Bitcoin Dev Team could certainly write code that gave them 100 million coins, but it will be difficult to convince the miners, exchanges, payment processors, wallet developers and the rest of the community to run it. And this is exactly what happened early in Monero's history, where the lead developer got ejected from the community: https://monero.stackexchange.com/questions/1011/monero-inception-how-did-bitmonero-become-monero https://monero.stackexchange.com/questions/1011/monero-incep... And this is also what's happening now in Bitcoin Cash, where the developers of ABC (up until now the client almost everyone used) wants to assign themselves 8% of the rewards from a mined block. And the the rest of the community are rejecting it heavily. So yes, the community would fork it.
    - bootcampwhere 6y ago
Temasik 6y ago
US dollar is now independent of thr US economy Digital US dollar is the new bitcoin long USD short BTC and crypto
canjobear 6y ago
> 1) This new digital currency is now the dominant currency. 2) Everyone trades goods and services based off of this new currency 3) People outside your country respect that everyone inside the country values this at some specific value and honours trade in that currency. All you have to do is convince your recipient that there is at least one other person who would trade the crypto for something else valuable. Then you can send it to your recipient and they can convert it into whatever they want. You don't have to convince them that everyone finds it valuable.
- chunky1994 6y ago
  I was making those statements in the context of those conditions being necessary for a failed state's currency to be replaced by a cryptoeconomic currency. But to answer your specific point, even if you could convince someone else that they could trade it for something else valuable, you have to keep going up the chain or it is purely bilateral and no longer a currency but a barter good. > they can convert it into whatever they want. They can't convert to to whatever they want, unless the other people also engaged in this economy value the currency and are willing to trade goods and services for it, hence (2)

idolaspecus 6y ago

> It is extremely unlikely you can convince anybody outside a country of (3) without some intervening international body, so the "crypto economy" replacing currency to fight an authoritarian regime is practically never going to happen. Could anti-authoritarian outsiders use (3) to effectively support anti-authoritarian insiders?

judge2020 6y ago
The "people" in (3) refers less to the working class than it does to people in power that control and contribute to large percentages (>0.5%) of a country's GDP/wealth (unless nearly all of the working class within a country recognizes it).
- deleted 6y ago
  [deleted]
chunky1994 6y ago
Not sure why this question is being downvoted, but possibly. However this is fraught with various complications and is a discussion around failed state govts.' regime enforcement, internal citizenries' access to external organizations and various other ways in which other economic actors interact with these, a very complex separate discussion on its own and it requires one too many assumptions for me to be comfortable providing any intelligent opinion on without starting from a common base of assumptions.

lawn 6y ago

Another benefit with cryptocurrencies is that nobody's allowed to control the supply, so you escape the inflation heavy fiat money we use today.

arcticbull 6y ago
The supply is controlled solely by a group of random, un-elected, un-accountable to anyone, GitHub contributors. If the Bitcoin Dev Team wanted, they could up the number of coins. Arbitrarily. Without recourse. What are you going to do, fork it? Further, the massive, overwhelming breakage due to the user-hostile nature of cryptocurrencies has led to staggering deflation. 20% is gone already [1]. Finally, the worst part is that the Bitcoin wealth distribution is worse than any banana republic; 0.00088% of addresses control 17.5% of all coins. 4.11% of addresses control 96.53% of coins. [2] Unless you're a whale, you're fighting for scraps today, and the next generation of market participants will be basically serfs. Deflation and breakage exaggerate this problem. If you thought letting them eat cake was bad... [1] https://www.investopedia.com/news/20-all-btc-lost-unrecoverable-study-shows/ https://www.investopedia.com/news/20-all-btc-lost-unrecovera... [2] https://howmuch.net/articles/bitcoin-wealth-distribution https://howmuch.net/articles/bitcoin-wealth-distribution
- lawn 6y ago
  The Bitcoin Dev Team could certainly write code that gave them 100 million coins, but it will be difficult to convince the miners, exchanges, payment processors, wallet developers and the rest of the community to run it. And this is exactly what happened early in Monero's history, where the lead developer got ejected from the community: https://monero.stackexchange.com/questions/1011/monero-inception-how-did-bitmonero-become-monero https://monero.stackexchange.com/questions/1011/monero-incep... And this is also what's happening now in Bitcoin Cash, where the developers of ABC (up until now the client almost everyone used) wants to assign themselves 8% of the rewards from a mined block. And the the rest of the community are rejecting it heavily. So yes, the community would fork it.
  - bootcampwhere 6y ago

Temasik 6y ago

US dollar is now independent of thr US economy Digital US dollar is the new bitcoin long USD short BTC and crypto

canjobear 6y ago

> 1) This new digital currency is now the dominant currency. 2) Everyone trades goods and services based off of this new currency 3) People outside your country respect that everyone inside the country values this at some specific value and honours trade in that currency. All you have to do is convince your recipient that there is at least one other person who would trade the crypto for something else valuable. Then you can send it to your recipient and they can convert it into whatever they want. You don't have to convince them that everyone finds it valuable.

chunky1994 6y ago
I was making those statements in the context of those conditions being necessary for a failed state's currency to be replaced by a cryptoeconomic currency. But to answer your specific point, even if you could convince someone else that they could trade it for something else valuable, you have to keep going up the chain or it is purely bilateral and no longer a currency but a barter good. > they can convert it into whatever they want. They can't convert to to whatever they want, unless the other people also engaged in this economy value the currency and are willing to trade goods and services for it, hence (2)