8 ms·

Wall Street struggles to sell Washington on Bitcoin for the masses

49 points by freewizard 5y ago

just_one_time_ 5y ago
Lol, more Bitcoin hate, you guys are hilarious.
humbleMouse 5y ago
I wonder if this has anything to do with the fact that a system of CA certificate encryption has been around forever, and Bitcoin is burning electricity for literally no reason?
- WrtCdEvrydy 5y ago
  > Bitcoin is burning electricity for literally no reason? reply I'd argue it's for a good reason the same way we burn gasoline at a traffic light instead of just going when it's red. Safety costs money, and Bitcoin burning electricity protects the network.
  - geofft 5y ago
    And in a perfect analogy to cryptocurrencies, newer, better technologies like hybrid engines (not to mention purely electric vehicles) support shutting off the engine completely at a traffic light and not burning energy idling an engine, and older technologies like bicycles and horses never had this problem in the first place, but people pretend that "safety costs money" is a rule of nature nonetheless.
    - decafninja 5y ago
      Seems many (most? all?) modern cars have the idle engine shutoff feature. My 2016 car had the option to permanently disable it with a switch. My 2018 car no longer has that option - only the option to disable it for the current trip. And according to the salesman, all new cars are like that?
      - deleted 5y ago
        [deleted]
      - nradov 5y ago
        Not all new cars, but many.
  - dragonwriter 5y ago
    > I'd argue it's for a good reason the same way we burn gasoline at a traffic light Burning gas at a traffic light isn't for a “good reason”, except insofar as the dominance of environmentally hostile technology through the de facto subsidy of externalized costs is a “good reason”. But I don’t disagree that the analogy being drawn between that pollution and bitcoin is apt.
    - WrtCdEvrydy 5y ago
      > I don’t disagree that the analogy being drawn between that pollution and bitcoin is apt. Okay, how about the pollution from SSL on the web? Every device has to have dedicated crypto hardware and we spend CPU cycles on it... because we want secure transactions.
- SamReidHughes 5y ago
  Everybody who's buying that electricity has a reason, and everybody sending those people money has a reason, and so on down the chain.
  - frzj 5y ago
    The reason being the fear of missing out on getting more fiat money back than they paid for. If you buy ETFs you at least indirectly incentivize firms who produce usefull stuff like medicine, food, shelter, insurance or trading (not by itslf useful but it serves an important role in our economy). Now that I think about it, maybe you are onto something. Even if crypto is just a fad it was an important signal for governments and the markets.
    - SamReidHughes 5y ago
      I can add another reason: Because I want to.
- antonvs 5y ago
  How would a PKI prevent double spending in a distributed network? If you could solve that problem well without burning the electricity Bitcoin does, you'd revolutionize industries.
perardi 5y ago
I think it’s worth even reading one paragraph past the headline… “A strong push by Wall Street to open up access to Bitcoin investment is meeting resistance from a bipartisan group of lawmakers and regulators in Washington, setting up a lobbying fight over the future of digital currency.” …as this article is not so much about creating some sort of central bank crypto, but getting the SEC to allow investment in Bitcoin ETFs.
dumbfoundded 5y ago
One of my biggest fears of cryptocurrency is that the government adopts it and forces businesses and individuals to use it. Everything is taxed automatically and all the details are retained forever. Want to sell a bike on Craigslist? Now your income and sales tax are applied automatically. All of your purchase information is now centralized in the hands of the government forever.
- 6f8986c3 5y ago
  Exactly. The whole "anonymous, decentralized, peer-to-peer" thing went out the window a long time ago. Now, Bitcoin is a digital yuan with an infinite history of every purchase made with it (the blockchain). No thanks. At this point, I'm starting to think the only viable alternative, from a medium-of-exchange perspective, is in commodity money -- metals and other materials that possess intrinsic value.
  - dumbfoundded 5y ago
    There isn't really only a single viable or perfect system. Each monetary system has different tradeoffs. Commodities work well until liquidity becomes a problem and so governments print fiat commodity-backed currency. Eventually a situation arises and the government needs extra $$$ so they start to inflate the currency and eventually remove the backing once everyone is already using the fiat currency. Credit systems are great for liquidity but have cascading failures once a situation arises requires settling up.
  - antonvs 5y ago
    > metals and other materials that possess intrinsic value. What role do you believe intrinsic value plays? Intrinsic value is useful if you're trying to "peg" a currency to some other measure of wealth. But that only works for relatively small markets. Currencies are a representation of wealth in a society. The wealth in a society is necessarily greater than that of any single asset. As such, the value of a currency based on an asset must be surplus to any supposed intrinsic value that asset has. This means intrinsic value serves no direct useful purpose for a currency - at best, it's a secondary consequence of some more important property, such as scarcity.
tac0_ 5y ago
I'm pretty bullish on crypto but the concept of a bitcoin ETF that's managed by Wall Street seems to go against the purpose of decentralised finance to begin with. Why do investors need to go through a middle man when they could just buy something like the crypto20 which is essentially the same thing but without the fees.
- wmf 5y ago
  Maybe five years ago the argument of "it's sooo hard to buy Bitcoin" was true, but now it's just as easy to buy crypto as stocks through Robinhood. Yet the middle men like Fidelity still want these ETFs for the fees I guess.
  - thekyle 5y ago
    I think the ETFs would be more useful if they held the top 25 cryptos at market cap weights. That could be kinda a hassle to do individually.
  - swiley 5y ago
    It's still hard to get FDs for crypto because there's distributed credit.
  - weasel_words 5y ago
    Can you take your Bitcoin out of Robinhood? Of course not. You do not actually own any Bitcoin at Robinhood. There's the "middleman" in your scenario without a middleman...just a different kind of middleman.
    - antonvs 5y ago
      True, although an ETF purely in a single crypto seems exactly like what Robin Hood or Coinbase are doing but with extra, presumably non-free, steps.
    - SnowProblem 5y ago
      Supposedly this is coming: https://www.coindesk.com/robinhood-crypto-withdrawals-deposits https://www.coindesk.com/robinhood-crypto-withdrawals-deposi...
ArkanExplorer 5y ago
How many institutions that bought in at $50,000-$60,000 are now sitting on huge unrealised losses, and are now trying to offload their positions to retail investors?
morpheos137 5y ago
SEC Commissioner Hester Peirce, a Republican on the agency’s five-member board, said Gensler’s recent warnings “conveyed the overly conservative approach that has typified the SEC in the crypto arena.” She said the agency should move forward with approval of crypto funds on their merits. What are the "merits" of crypto [funds]? Separating ever greater fools from their money to enrich early adopters without actually engaging in any real economic activity? Money laundering? Tax evasion? Digital counterfeiting? (i.e. saying 1 USDT = 1 USD) Ransomware? Wasting energy? Here is a fact: Congress' reputation is in the toilet. If it wants to get a modicum of respect back then maybe it should take a firm stand against "crypto." Nothing is economically new or innovative or useful in crypto for legitimate, real world applications. Never in history has a successful government abdicated control of its currency. Control over legal tender is one of the core functions of government. If bitcoin is a currency then what it aims to do is not different from what Liberty Reserve or eGold aimed to do. At least eGold had some underlying real asset. Bitcoin is just made of air. Sorry "math." If bitcoin is an asset then its value is akin to underwater swamp land in florida. I.e. it is a fraud. No, people should not be able to just make a token on a whim and extract economic power in exchange for producing no real economic good. If Congress wants to take a stand it should firmly ban US banks from interacting with entities that relate to the fraudulent scheme that is Bitcoin, et al. Hester Pierce (wonder if there is a relation to Brock Pierce) is either really dull or really corrupt. Bitcoin has zero, actually negative economic value. It is ludicrous that an SEC chair would pretend it does simply because number big. Anybody remember the AAA securitisation of garbage mortgages a decade ago? Just because a financial product is in current market demand or has a high price does not mean that it is legitimate or that it has positive economic value. The job of congress and regulators is precisely to nip frauds like Bitcoin in the bud before they become bigger and wreck greater damage on the economy when they inevitably collapse or cause serious economic distortions (i.e. making billionaires out of early adopters who did not actually produce anything of value. The transfer of purchasing power from productive individuals to rent seeking individuals (i.e. those lobbying Congress to legitimise their Monopoly money) is a surefire way to harm an economy. So Ms. Pierce what exactly are the "merits" of Bitcoin? Please tell... This should not be a partisan issue. Just like printing fake dollars is not a partisan issue. Maybe Congress can do something right for a change...doubt it though...sadly.

49 points by freewizard 5y ago

Lol, more Bitcoin hate, you guys are hilarious.

I wonder if this has anything to do with the fact that a system of CA certificate encryption has been around forever, and Bitcoin is burning electricity for literally no reason?

WrtCdEvrydy 5y ago
> Bitcoin is burning electricity for literally no reason? reply I'd argue it's for a good reason the same way we burn gasoline at a traffic light instead of just going when it's red. Safety costs money, and Bitcoin burning electricity protects the network.
- geofft 5y ago
  And in a perfect analogy to cryptocurrencies, newer, better technologies like hybrid engines (not to mention purely electric vehicles) support shutting off the engine completely at a traffic light and not burning energy idling an engine, and older technologies like bicycles and horses never had this problem in the first place, but people pretend that "safety costs money" is a rule of nature nonetheless.
  - decafninja 5y ago
    Seems many (most? all?) modern cars have the idle engine shutoff feature. My 2016 car had the option to permanently disable it with a switch. My 2018 car no longer has that option - only the option to disable it for the current trip. And according to the salesman, all new cars are like that?
    - deleted 5y ago
      [deleted]
    - nradov 5y ago
      Not all new cars, but many.
- dragonwriter 5y ago
  > I'd argue it's for a good reason the same way we burn gasoline at a traffic light Burning gas at a traffic light isn't for a “good reason”, except insofar as the dominance of environmentally hostile technology through the de facto subsidy of externalized costs is a “good reason”. But I don’t disagree that the analogy being drawn between that pollution and bitcoin is apt.
  - WrtCdEvrydy 5y ago
    > I don’t disagree that the analogy being drawn between that pollution and bitcoin is apt. Okay, how about the pollution from SSL on the web? Every device has to have dedicated crypto hardware and we spend CPU cycles on it... because we want secure transactions.
SamReidHughes 5y ago
Everybody who's buying that electricity has a reason, and everybody sending those people money has a reason, and so on down the chain.
- frzj 5y ago
  The reason being the fear of missing out on getting more fiat money back than they paid for. If you buy ETFs you at least indirectly incentivize firms who produce usefull stuff like medicine, food, shelter, insurance or trading (not by itslf useful but it serves an important role in our economy). Now that I think about it, maybe you are onto something. Even if crypto is just a fad it was an important signal for governments and the markets.
  - SamReidHughes 5y ago
    I can add another reason: Because I want to.
antonvs 5y ago
How would a PKI prevent double spending in a distributed network? If you could solve that problem well without burning the electricity Bitcoin does, you'd revolutionize industries.

perardi 5y ago

I think it’s worth even reading one paragraph past the headline… “A strong push by Wall Street to open up access to Bitcoin investment is meeting resistance from a bipartisan group of lawmakers and regulators in Washington, setting up a lobbying fight over the future of digital currency.” …as this article is not so much about creating some sort of central bank crypto, but getting the SEC to allow investment in Bitcoin ETFs.

dumbfoundded 5y ago

One of my biggest fears of cryptocurrency is that the government adopts it and forces businesses and individuals to use it. Everything is taxed automatically and all the details are retained forever. Want to sell a bike on Craigslist? Now your income and sales tax are applied automatically. All of your purchase information is now centralized in the hands of the government forever.

6f8986c3 5y ago
Exactly. The whole "anonymous, decentralized, peer-to-peer" thing went out the window a long time ago. Now, Bitcoin is a digital yuan with an infinite history of every purchase made with it (the blockchain). No thanks. At this point, I'm starting to think the only viable alternative, from a medium-of-exchange perspective, is in commodity money -- metals and other materials that possess intrinsic value.
- dumbfoundded 5y ago
  There isn't really only a single viable or perfect system. Each monetary system has different tradeoffs. Commodities work well until liquidity becomes a problem and so governments print fiat commodity-backed currency. Eventually a situation arises and the government needs extra $$$ so they start to inflate the currency and eventually remove the backing once everyone is already using the fiat currency. Credit systems are great for liquidity but have cascading failures once a situation arises requires settling up.
- antonvs 5y ago
  > metals and other materials that possess intrinsic value. What role do you believe intrinsic value plays? Intrinsic value is useful if you're trying to "peg" a currency to some other measure of wealth. But that only works for relatively small markets. Currencies are a representation of wealth in a society. The wealth in a society is necessarily greater than that of any single asset. As such, the value of a currency based on an asset must be surplus to any supposed intrinsic value that asset has. This means intrinsic value serves no direct useful purpose for a currency - at best, it's a secondary consequence of some more important property, such as scarcity.

tac0_ 5y ago

I'm pretty bullish on crypto but the concept of a bitcoin ETF that's managed by Wall Street seems to go against the purpose of decentralised finance to begin with. Why do investors need to go through a middle man when they could just buy something like the crypto20 which is essentially the same thing but without the fees.

wmf 5y ago
Maybe five years ago the argument of "it's sooo hard to buy Bitcoin" was true, but now it's just as easy to buy crypto as stocks through Robinhood. Yet the middle men like Fidelity still want these ETFs for the fees I guess.
- thekyle 5y ago
  I think the ETFs would be more useful if they held the top 25 cryptos at market cap weights. That could be kinda a hassle to do individually.
- swiley 5y ago
  It's still hard to get FDs for crypto because there's distributed credit.
- weasel_words 5y ago
  Can you take your Bitcoin out of Robinhood? Of course not. You do not actually own any Bitcoin at Robinhood. There's the "middleman" in your scenario without a middleman...just a different kind of middleman.
  - antonvs 5y ago
    True, although an ETF purely in a single crypto seems exactly like what Robin Hood or Coinbase are doing but with extra, presumably non-free, steps.
  - SnowProblem 5y ago
    Supposedly this is coming: https://www.coindesk.com/robinhood-crypto-withdrawals-deposits https://www.coindesk.com/robinhood-crypto-withdrawals-deposi...

ArkanExplorer 5y ago

How many institutions that bought in at $50,000-$60,000 are now sitting on huge unrealised losses, and are now trying to offload their positions to retail investors?

morpheos137 5y ago

SEC Commissioner Hester Peirce, a Republican on the agency’s five-member board, said Gensler’s recent warnings “conveyed the overly conservative approach that has typified the SEC in the crypto arena.” She said the agency should move forward with approval of crypto funds on their merits. What are the "merits" of crypto [funds]? Separating ever greater fools from their money to enrich early adopters without actually engaging in any real economic activity? Money laundering? Tax evasion? Digital counterfeiting? (i.e. saying 1 USDT = 1 USD) Ransomware? Wasting energy? Here is a fact: Congress' reputation is in the toilet. If it wants to get a modicum of respect back then maybe it should take a firm stand against "crypto." Nothing is economically new or innovative or useful in crypto for legitimate, real world applications. Never in history has a successful government abdicated control of its currency. Control over legal tender is one of the core functions of government. If bitcoin is a currency then what it aims to do is not different from what Liberty Reserve or eGold aimed to do. At least eGold had some underlying real asset. Bitcoin is just made of air. Sorry "math." If bitcoin is an asset then its value is akin to underwater swamp land in florida. I.e. it is a fraud. No, people should not be able to just make a token on a whim and extract economic power in exchange for producing no real economic good. If Congress wants to take a stand it should firmly ban US banks from interacting with entities that relate to the fraudulent scheme that is Bitcoin, et al. Hester Pierce (wonder if there is a relation to Brock Pierce) is either really dull or really corrupt. Bitcoin has zero, actually negative economic value. It is ludicrous that an SEC chair would pretend it does simply because number big. Anybody remember the AAA securitisation of garbage mortgages a decade ago? Just because a financial product is in current market demand or has a high price does not mean that it is legitimate or that it has positive economic value. The job of congress and regulators is precisely to nip frauds like Bitcoin in the bud before they become bigger and wreck greater damage on the economy when they inevitably collapse or cause serious economic distortions (i.e. making billionaires out of early adopters who did not actually produce anything of value. The transfer of purchasing power from productive individuals to rent seeking individuals (i.e. those lobbying Congress to legitimise their Monopoly money) is a surefire way to harm an economy. So Ms. Pierce what exactly are the "merits" of Bitcoin? Please tell... This should not be a partisan issue. Just like printing fake dollars is not a partisan issue. Maybe Congress can do something right for a change...doubt it though...sadly.