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Why would it be good to free currency from government regulation? This is something I often see crypto advocates blow right past as if it's self explanatory, bu
by noelsusman 6y ago
Why would it be good to free currency from government regulation? This is something I often see crypto advocates blow right past as if it's self explanatory, but I don't think it is.
I like that the currency I use is managed by my government. Why should I want to switch?
- fastball 6y agoObviously the biggest one is concern over things like hyperinflation, which has happened in the real-world many times. Or, not quite at hyperinflation, but your government is enacting policies based on MMT or similar and you are worried that this could hurt you (as a holder of the currency) in the long-run. Or, maybe you're worried about governments being able to dictate what you are allowed to purchase with "their" money. Or, maybe you want to send your money somewhere your government doesn't want you to send it (or their government doesn't want the other party to get it). Obviously there is a lot more to cryptocurrency than just "not being issued by a government" as well though. There is general privacy benefits (Monero) or the promise of innovation if you have programmable money / contracts (Ethereum).
- cortesoft 6y agoYeah, but both hyperinflation and hyperdeflation have occurred with Bitcoin. At least with fiat currency, you have a central bank that can TRY to take steps to fix those conditions.
- faeyanpiraat 6y agoI'm not a finance expert, but I don't think those issues are caused by the kind of money used. People make mistakes, some of them are greedy, powerful people want to keep their power, etc.. You can't fix people with a currency. And humans are creative, if you switch over to crypto, they'll find a new way of doing the same old things.. My government not wanting me to send money somewhere: Well, this might be a clichè, but apart from slightly limiting my freedom this prevents bad guys doing nasty stuff aswell.
- FpUser 6y ago>"...My government not wanting me to send money somewhere: Well, this might be a clichè, but apart from slightly limiting my freedom this prevents bad guys doing nasty stuff aswell..." Bad guys get around it one or the other way. You do not.
- cloudinshape 6y agoThe end of the gold standard in the 70s meant the US could "afford" to fight infinite wars by just printing dollars and passing the real cost to the rest of the world, that is why the US is now the world's biggest borrower nation when it used to be the world's biggest creditor nation. The current state of endless military interventions is only possible because of the huge deficits in the US that are not possible with hard money.
- camgunz 6y agoI don't always agree w/ my government here in the US, but I do like that--while it's not a perfect process--as a democracy I can influence it. The reason it's illegal to buy certain things in the US (people, organs, drugs, assassinations) is that we all got together and thought people shouldn't do that. Many people disagree but, that's what voting is for. Subverting the will of a democratic people is... immoral? The typical counterargument is something like "well what about Saudi Arabia", but I think it's pretty easy for an oppressive regime to just say "you can't use cryptocurrency" and punish you severely for it--to the degree you won't. Anyway, I just don't think cryptocurrency is a solution to this, and even if it is it's antidemocratic.
- dmantis 6y agoYou assume that government is good and prohibited uses are bad. But your gov banned wikileaks bank accounts in the past and that is the perfect example of the case when the gov is definitely is a malicious actor (while their behaviour perfectly rational from their side of things). Govs do war crimes, mass espionage and human rights violations. That should be addressed as well.
- tsimionescu 6y agoYes, but it should be addressed democratically - protests, lobbying your representatives, even voting. Inventing a new currency that is, for a little while, hard to track by the government isn't a real solution, it's just pretending the problem doesn't exist. The government is persecuting WikiLeaks financially because that is easy to do. Even if a cryptocurrency were to take off as a currency and still be untraceable, the government would just move on to some other form of persecution. The real problem to be addressed is the persecution of a useful legitimate organization by an ostensibly democratic government. The form that persecution takes is secondary.
- AndrewUnmuted 6y ago> it should be addressed democratically - protests, lobbying your representatives, even voting. That hasn't worked yet for Wikileaks. If this worked and/or was the best way to deal with the types of problems Wikileaks is exposing, there would be no need for Wikileaks to exist. The reason Wikileaks does exist is because, typically, when we attempt to address atrocities "democratically" we get nowhere. On the other hand... > Inventing a new currency that is, for a little while, hard to track by the government This _has_ worked for Wikileaks in the past. When the US persecuted Wikileaks, Bitcoin helped to heavily negate the immediate impact of this action. > The form that persecution takes is secondary. In that case, why can't the form that Wikileaks' solutions take be secondary as well? If we are in agreement that Wikileaks is an important organization, then when addressing atrocities "democratically" fails, what would be wrong with short-term innovation?
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- samatman 6y agoThe 2% annual debasement rate of modern state currencies would have been a massive crisis in the era of metals. Imagine a king putting 2% less silver in the coin, year over year. We're just used to it. But leave that aside, you said you like government-managed currency and I believe you. Venezuelans don't. The way I see it, what's stopping the EUR and USD from going down that spiral is momentum, rather than some law of nature. I'm not convince the issuing schedule for BTC is ideal either. Grin, to pick a cybercoin which has some interesting technical innovations, issues one coin per minute, forever, and since coins are lost, this might be better. But I like the idea of a transnational currency, where no one government is in a position to change the rate of issue, and I think Bitcoin has real potential as a refuge for value to flee to, in the event that the increasingly reckless experiments which Western governments and their central banks are making with their currencies come back to bite us. Don't think it would spell the end of sovereign currencies, either. It would force them to be more honest, though, and that would be a good thing.
- fbelzile 6y agoI agree with you, but there are some people around the world that don't trust their governments. A use-case most people here would agree with is in the yellow economic circle in Hong Kong: https://en.wikipedia.org/wiki/Yellow_economic_circle https://en.wikipedia.org/wiki/Yellow_economic_circle Using a cryptocurrency is kind of like a technological band-aid to a political problem. Viewed through the lens as a form of peaceful protest against the government, it makes sense. Otherwise, it's completely your call if you want to make transactions where the receiver has no obligation to provide the product or service you paid for.
- oblio 6y agoIt's a very niche use case, though. Especially for creating a new global currency, used by everyone. And those people are probably screwed anyway, unfortunately for them. If a big government hates your guts... you're not going to make it. Might be safer for them to buy gold and just bolt.
- betwixthewires 6y agoIt is easier to carry cryptocurrency than gold while fleeing from armed men.
- oblio 6y agoAgreed. How about the first point, that it solves a problem most people don't have? Why would this be a mass market product? What's the benefit for J. Random?
- betwixthewires 6y agoI'm copying a comment I made earlier that answers this question: So I hate to use the word I'm about to use, because of the modern connotations associated with it, but it does apply here. There are billions of people who are abused by their government, who cannot trust their government, who's local money is debased by their government at a whim. You are privileged (there's that word) to have a government that you feel you can trust to control the value of your savings and your purchasing power. You do not see the value proposition because there is not much of one for you. Cryptocurrency doesn't exist for you. It exists for the people who do need it. And again, there are billions of people who need it, as much as half the world's population, possibly more.
- vmception 6y agogovernments or their people try to tie prosperity and access to morality, in arbitrary ways outside of their constitutional framework in arbitrary conditions that change over time, and are different across borders having an optional liquid payment system outside of their control solves that and the existence of that optional liquid payment system has the possibility of making their controlled one redundant
- jMyles 6y ago> Why would it be good to free currency from government regulation? Obviously this is a huuuuge question, but it's such a good one. The simplest compact answer, at least to me (and it may in fact be an oversimplification) goes something like this: * Nearly invariably (and with a decreasing number of exceptions as technology advances), states which have control over both sides of the economic equation (ie, monetary concerns as well as national finance) find themselves unable to resist devolving into empire, and a specific type of empire called a "welfare-warfare" state, where the money supply is carefully controlled in such a way as to produce just enough support (often through pseudoscientific 'macro-economic' analysis and 'unemployment' prevention) to preclude revolution, while also projecting military power on poorer parts of the world in order to capture resources in a misguided effort to service the never-ending debt that accompanies the fiat money system. In this view (and to be clear, it's one I hold), states with these powers (a clear conflict of interest, IMO) will continue to plunder the earth and attempt to enslave its people indefinitely, and can only be practically stopped by the economic adjustment that comes from the introduction of a hard currency (which causes the cycle of debt service to become impossibly onerous, even for an empire state). * For a less oversimplified version, I might recommend Ron Paul's book "End the Fed", which is an introduction to the history of hard-money economics and can be read in a day or two. * For an even less oversimplified version, you'll need to delve into the "Chicago School" and / or "Austrian School" of economics. Milton Friedman and Ludwig Von Mises are probably the best known scholars of each.
- hakfoo 6y agoI'm not sure I understand the welfare-warfare model. It seems like it requires a bunch of preconditions: * The cycle of debt needs to be bootstrapped. You need some initial borrowing well beyond current (expected) repayment capacity. This implies both some overspending and lack of due diligence by lenders willing to extend the rope. * The debt is denominated in a currency the borrower doesn't control. If you're American borrowing dollars, or Russia borrowing roubles, you can always deflate the currency to moot the debt. * The state has no legal leverage against lenders. A continuation of the tactics above-- I could imagine a desperate nation simply refusing to redeem its bonds, or even prosecuting people attempting to claim then. There may be incentives and default-approaches that encourage the growth of empire to feed a debt addiction, but it's far from the only way. In the worst case, you end up with a default and limited to dealing with lenders who are legally required to deal with you (i.e. requiring pension plans or state-owned enterprises to sponge up government bonds) until someone else is willing to take a punt.
- cloudinshape 6y agoBecause the government will not always be on your side, as 2020 demonstrated so well what many peoples outside the US have know from experience for decades.
- oblio 6y agoWho do you resort to if you get defrauded through blockchain currencies... ? The Trusty Libertarian Neighborhood Watch?
- cloudinshape 6y agoWhy do you feel so much the need to blame someone else?
- oblio 6y agoSo the solution is "caveat emptor"?
- aaronax 6y agoThe police, just like when you use cash for commerce and someone scams you.
- oblio 6y agoYeah, but then what's the point? If the whole point of cryptocurrencies is to work around the government and cryptocurrencies are going to strip them of various tools they use (control over inflation and monetary mass, monetary controls in the sense of taking money outside of a country, etc), governments will most likely not allow that, for pretty solid reasons. It's an interesting experiment, I'll grant it that. But I don't think it can have its cake and eat it, too. I guess we'll have to wait and see.
- tipsysquid 6y agoThis is a valid concern, but what do you say to the current system that does not prevent all kinds of fraud. Perhaps even rampant with it. An easy search will show you that large regulated institutions participate and engage in fraud at all levels of their institution. Why is it that crypto must bear a larger burden of scrutiny against the status quo? I believe that fraud is easier to identify and financially punish on public blockchains. Exchanges and other entities already have the ability to blacklist an address's assets and prevent them from off-ramping into fiat ms being used in future transfers. Businesses exist today to prevent payments of blacklisted assets. Compared to cash, blockchain based cryptoassets have more choice in enforcement against fraud. Also, crypto assets can be seen by all publicly on chain. It fairly easy to trace the work of cryptoasset fraudsters
- betwixthewires 6y agoSo I hate to use the word I'm about to use, because of the modern connotations associated with it, but it does apply here. There are billions of people who are abused by their government, who cannot trust their government, who's local money is debased by their government at a whim. You are privileged (there's that word) to have a government that you feel you can trust to control the value of your savings and your purchasing power. You do not see the value proposition because there is not much of one for you. Cryptocurrency doesn't exist for you. It exists for the people who do need it. And again, there are billions of people who need it, as much as half the world's population, possibly more.
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- alwillis 6y agoThere are billions of people who are abused by their government, who cannot trust their government, who's local money is debased by their government at a whim. The United States inflated the money supply by many trillions of dollars in the past year, which decreases the buying power of the dollar. With savings accounts paying close to 0% interest, due to inflation, savers are losing money in these accounts each year. And while the goal of the Fed is to manage the economy to have about 2% inflation, in reality, the things that people care about—higher education, medical care, real estate in many cities—has inflated much more than 2% annually. The dollar is being debased gradually; one day it could be sudden.
- betwixthewires 6y agoPeople don't realize that at that target rate of 2% yearly, your savings lose half their purchasing power over a 10 year timespan. The number looks small, so people see that and say "oh, no big deal" but they don't realize how big of an impact it has on their net worth if their assets are mostly fiat currency. Additionally, most people don't notice how this affects their behavior and encourages people to save less and spend more, but from a macroeconomic perspective the effect is plain as day, most people have less than 1k in savings.
- Staurt101 6y agoLord Masuka helped me bring my husband back after he abandoned me for half a year, contact him today for any help lordmasukaspelltemple@hotmail.com or whatsapp him +1(234)-307-0752