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Out of control and rising: why Bitcoin has Nigeria’s government in a panic
- spiffydave 5y agoThose in power fear anything out of their control. See what's happening with the infrastructure bill and crypto as the latest example. On the other hand, us little people should support anything that gives the average person a fighting chance against the rich and powerful.
- jorblumesea 5y agoJackson Palmer, creator of Doge Coin, summarizes why he thinks this is a false narrative: https://twitter.com/ummjackson/status/1415353986392072196?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1415353987503583236%7Ctwgr%5E%7Ctwcon%5Es2_&ref_url=https%3A%2F%2Fwww.cnbc.com%2F2021%2F07%2F14%2Fdogecoin-co-creator-jackson-palmer-criticizes-the-crypto-industry.html https://twitter.com/ummjackson/status/1415353986392072196?re... I tend to agree. There are legitimate use cases, but overall it's unclear whether "the little guys" are really the main use case or how much the average Nigerian (or anyone else except the ultra wealthy) might benefit. Now if your point is that some wealthy elites want to take power away from other wealthy elites, I'd say this is a more accurate take on the situation. For example, being able to circumvent taxes, or being able to manipulate markets on a global scale.
- quadcore 5y agoWell apparently it's taken people out of poverty in Nigeria. Now I agree it's a tax problem. Coulnt smart contracts solve that?
- SwimSwimHungry 5y agoApparently? There is no real proof this has brought mostly normal people in Nigeria out of poverty, at least at large enough numbers to be believed. This is just some yarn spun up by proponents of cryptocurrency to rally more to their cause. I'd be shocked if most people in Nigeria even have a personal computer and reliable internet. That's how impoverished most of them are.
- spiffydave 5y agoNigeria has a cell phone adoption rate of around 50% currently. People can trade crypto, do banking, money transfers, etc. on a cell phone. The idea that a desktop computer is required is a very old-school mindset. Similar to your "everyone in Nigeria is impoverished" comment. Also, it's not about getting rich. It's about surviving when the government has all power to freeze your bank accounts, inflate the currency, etc.
- beaner 5y agoGoogle: "what percentage of nigerians have cell phones" Answer: "While Nigeria's mobile penetration rate is lower than developed markets, it is higher than the average across sub-Saharan Africa, standing at around 50% as of 2018, and estimated to rise to 130 million or about 60%-65% of the total population by 2025." Also: Absence of evidence is not evidence of absence. Which, in this case, is to say that it may be that "there is no real proof that this has brought mostly normal people in nigeria out of poverty." But did you RTFA? It talks about how crypto is helping normal people. So there isn't evidence against this idea either. Maybe we should try to find out, rather than be dismissive.
- exdsq 5y ago> I'd be shocked if most people in Nigeria even have a personal computer and reliable internet. That's how impoverished most of them are. I did a little research on this for a job last year and internet access/mobile phone ownership numbers are far higher than I expected. Mobile payments are already a very common form of transaction in Africa. The Gates Foundation mentioned that one of the big issues with their current infrastructure is middle-men fees when talking about remittances between African countries through to mobile credit, so crypto is actually a strong candidate to improve that area too.
- endisneigh 5y agoWhy do people use Africa and Nigeria interchangeably?
- exdsq 5y ago
- 0x000000001 5y agoWhy does anyone care what Jackson Palmer thinks?
- hanniabu 5y agoBecause it supports their bias that crypto is nothing but scams and has no utility
- spiffydave 5y agoYeah, and Mr. Palmer evidently has his own political axe to grind. Good for him. Glad he can say what he wants.
- wwweston 5y agoWhy does anyone care what commentors on HN think? Why not read the actual Twitter thread and see if the argument has merit? Or engage the summary that the GP brought into the thread instead of pretending the only relevant point in play is the authority of Palmer? And finally, why not acknowledge that maybe someone who created a coin that took off might have some worthwhile insight?
- spiffydave 5y agoI did read it. Not super impressed, but glad he has the freedom to say what he wants. Yes, crypto is being manipulated and distorted by the wealthy and powerful. It's sad to see. But it's still beneficial to the average person to have other options outside of the current system.
- spiffydave 5y agoAnyone can buy crypto. Not understanding how it's only for wealthy elites. And Mr. Palmer is out of crypto. Good for him. And the solution to reign in fiat-based crony capitalism is what? I 100% agree with the premise that the ultra-wealthy are finally getting on board with crypto and will pollute it with the same manipulation they've used in other markets. But that still doesn't mean it can't be used by the average person to build wealth if done correctly.
- jorblumesea 5y agoCan everyone just tweet and move markets? Does the average person need hard to trace currencies to evade taxes? Does the average person have stakes in large exchanges, or stand to gain anything by a loose (read: non-existent) regulatory environment? The average person really doesn't need many of the use cases that crypto provides, as of today. Most of the "normal people use cases" have yet to materialize. I really struggle with this narrative, because it just doesn't reflect any sense of reality. I own crypto, I heavily participate in the space, and yet I don't get people that think a mother of 3 needs to own Eth in any practical sense.
- beaner 5y agoFunny cuz this article describes a whole country starting to find "normal people use cases" for crypto.
- jorblumesea 5y agoThe vast majority of the article focuses on speculative trading, not day to day activities. There's a small paragraph on paying employees, but really it's just the mismanaged finances of Nigeria providing that need. Replace "Bitcoin" with "USD" or "seashells" and it's effectively the same thing. Sure, if you're the 1-2 countries in the world with 200% daily inflation, it makes sense. The vast majority of crypto holders (and users here) come from relatively stable western countries with strong regulatory environments with stable central banks. It's this narrative of "rich western citizens" talking about "real world use cases" that completely diverge from their day to day which is the ultimate irony. Think of the poor Africans! Said no one from Coinbase or Binance. Think of the use cases! Said the wealthy SWE speculatively trading shitcoins, x5 leverage to the gills. There are real world use cases, but likely if you're posting here on your macbook, they do not apply to you. People don't give a shit about venezuela or Nigeria, it's just greed.
- bko 5y agoCan I have an ELI5 on the infra bill and crypto? I keep seeing it come up on my twitter feed and I read a few articles, but it seems to be moving very fast. Is it just about taxes and squeezing crypto owners w/ realized gains for taxes?
- wmf 5y agoNo, they say it's about taxes but there's much more in it. The bill appears to require everyone in crypto (exchanges, miners, stakers, maybe even software developers) to do KYC on every transaction. This either requires massive technical changes or more likely all those entities would leave the US.
- bko 5y agoSo if I send you Bitcoin without KYC, I'm breaking the law? And it would be trivial to detect if I ever crossed a major exchange
- wmf 5y agoHonestly we don't know. The original bill is vague and there are two competing amendments that are being debated. It will take some time for this to shake out.
- spiffydave 5y agoHere's my rough explanation: Provisions were added into the bill that would require "know your customer" type requirements and taxation of crypto exchanges but were written so poorly that the requirements could be extrapolated to crypto miners, staking, etc. This is what happens when people who don't understand the technology in the first place try to write legislation at the last minute to insert into a bill that has nothing to do with crypto. Amendments have been proposed to try and clarify the bill, but there are multiple amendments that are "worse" or "better" for crypto. Guess which one Janet Yellen is pushing? (after receiving millions from big banks for "speaking engagements."
- sgt101 5y ago>us little people should support anything that gives the average person a fighting chance against the rich and powerful. I don't think that I have a chance in heaven or hell to navigate a completely opaque ecosystem where wash trading sets the value minute to minute and the mechanisms of realizing that value are run to make money off the realisation.
- iratewizard 5y agoEven in crypto, wash trading is illegal. It is also significantly more prohibitively expensive to wash trade a security with a market cap of $750T. If you were to try wash trading from a country where it's legal, you might be able to get away with it. But at that point you might as well wash trade in forex.
- wwweston 5y agoCryptocurrency is more likely to become a powerful tool to the rich and powerful with even less accountability than there is now than it is to become an incredible boon to the "average person." There's a difference between distributed and decentralized. Money and power can buy a lot of the distribution. And what, exactly, do you think you're fighting? Inflation or inflationary policies? Places to park money that are better than bits or gold have existed for a long time. Surveillance? An indelible ledger has its downsides here. Technology is more often a magnifier of existing human dynamics rather than a qualitative change. Especially one that seeks to replace existing tech. If you think it's going to produce a fundamental change, why is this different?
- SantalBlush 5y agoI think it's the new sales pitch for pyramid schemes: "Buy and hodl, and together we'll fight the machine!" Well, we'll need a lot of help from the likes of Elon Musk and Jack Dorsey, but it's totally all about helping the little guy.
- spiffydave 5y agoCool story bro! If you don't agree that's fine. Don't buy. If other people buy and have a different opinion it doesn't hurt you at all.
- danmaz74 5y agoA lot of people think that the power of the state, even in Western democracies, favors the rich and powerful against the little guy, through corruption and regulatory capture. What they don't realise is that, even in the much less than perfect state of our democracies and rule of law, the little guy is much more protected than any anarcho capitalistic system you could possibly create, where the rich and powerful won't even need to corrupt any officials: they will just use their personal police (or army) to enforce their power direcly, a bit like in the far west, or possibly like some kind of cyberpunk neo-medieval future.
- spiffydave 5y agoI think your argument is a very nice strawman. No one is endorsing an "anarcho capitalistic system" here. What we're saying is that having an alternative to fiat is some people's only hope when the government can close your accounts, inflate the currency, etc.
- danmaz74 5y agoA world where governments aren't able to forcibly close, and more importantly, impound your bank accounts even if you're the head of a Mafia family, or a corporation doing something that the law deems a corporation shouldn't do, looks to me like a very serious step towards anarcho capitalism - which, by the way, is the stated goal of not so few cryptocurrency fundamentalists.
- ajkdhcb2 5y agoIt's already like that, and it always has been. The most powerful people have immense power because they are inside governments or have corrupted them. At a level below that, they have funds in hidden offshore shell accounts, accounts under other people's names, physical assets. Further, like encryption, cryptocurrencies are not something that you can ban in an effective way no matter how desperately you want to, so you will just have to deal with it. The most powerful people will always have privacy and be above laws. The only way you can equalise it is to give some of those abilities to the little people
- vmception 5y agoI’m glad the guy’s Chinese suppliers accepted bitcoin Ive been paying for a lot of contractor work internationally with stablecoins over the last several years It annoys me how much Tether is often people’s only stablecoin option at the exchanges in their country, and that education is much lower on how to do stuff onchain without exchanges (so they could accept many more assets and convert to whatever they wanted) But its way better than western union/paypal/wise/revolut/wire, or when it’s not better it’s nice it’s an option
- anovikov 5y agoHow is it better than a wire? That's what i totally don't get. If you are not doing any criminal/black market transaction, what's the downside of sending a wire?
- kleer001 5y agoFees and privacy, I suppose.
- SwimSwimHungry 5y agoAt least with Bitcoin, the ledger is open for all to see. The privacy angle is specious at best.
- sebzim4500 5y agoIt's true that the ledger is public but it isn't necessarily tied to your identity. You can use exchanges that do not require KYC to convert to a privacy coin like Monero, and then move that to fiat exchanges like Coinbase etc.
- namibj 5y agoThey have ~30$ fees and take a day-or-two, depending on how well connected the banks involved are.
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- paulpauper 5y agoYeah looks like the nigerian prince who emailed me is promising millions of dollars in bitcon now
- maverickJ 5y agoAre you not tired of this trope?
- seibelj 5y agoThe typical central bank scam in developing countries is to make them ostensibly independent, but in reality they print new money and hand it to politically favored industries and entities. It allows the ruling class to loot their citizens very efficiently. Furthermore their stranglehold on remittances, where dollars are sent back by emigres and then converted into the local fiat scam coin, then enables them to centrally control what gets imported as they have the bulk of dollars. Bitcoin and other cryptos fix this scam and enable people to not lose 5 to 90% of their money per year to inflation. It’s really not hard to understand and why hacker news can’t wrap their heads around why crypto has utility is a lack of awareness of how the average government operates.
- pjc50 5y agoCrypto certainly doesn't offer price stability when it can go up or down by 5%. And, although you find the idea of defunding the Nigerian government appealing, what would replace it would be far more deadly.
- JanisL 5y agoPrice stability compared to what though? I think this is an important question because currency risks are going to be relative to your other options. If you live in a place where the local currency fluctuates like crazy anyway, or worse debases substantially each and every year, there's a lot less to lose from crypto instability compared to if you live somewhere with a stable local currency.
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- humaniania 5y agoVulnerable people losing vital wealth when Tether pops would be tragic. A "stablecoin" with <4% liquid reserves... https://www.coindesk.com/tether-first-reserve-composition-report-usdt https://www.coindesk.com/tether-first-reserve-composition-re...
- spiffydave 5y agoYeah, Tether isn't great. Why use that as your example? There are plenty of other stablecoins and the article was about Bitcoin.
- paulgb 5y agoThere’s an argument that the price of Bitcoin is propped up by Tether, a la Archegos. I was initially pretty skeptical, but the caginess of Tether about what commercial paper they hold makes me think it has some credence.
- spiffydave 5y agoThere's so much money coming into crypto and multiple studies have looked at money coming into Tether and the effect on Bitcoin price and it's negligible. Plus, money has been coming out of Tether and into other stablecoins and what is happening with Bitcoin's price? Yeah, up.
- paulgb 5y agoTether’s market cap is nearly at an all time high after roughly tripling in 2021 alone. What else should I be looking for as evidence of money coming out of Tether? Which studies are you referring to? https://coinmarketcap.com/currencies/tether/ https://coinmarketcap.com/currencies/tether/
- spiffydave 5y agoI'm referring to the comparison between Tether and USDC. Recently Tether has been flat and USDC is growing. Tether is obviously still #1 and not something I would hold as it does appear shady. https://www.coindesk.com/whats-going-on-with-tether https://www.coindesk.com/whats-going-on-with-tether https://voxeu.org/article/stable-coins-dont-inflate-crypto-markets https://voxeu.org/article/stable-coins-dont-inflate-crypto-m... https://www.sciencedirect.com/science/article/abs/pii/S0165176518302556# https://www.sciencedirect.com/science/article/abs/pii/S01651...
- voldacar 5y agoI was about to make a comment asking how viable this could be in poor nations due to btc transaction fees, but apparently they are way down compared to a few months ago. Average fee now is about 2$ compared to 10-20$ several weeks ago. I'm glad the Nigerians are actually using btc for its intended function!
- exdsq 5y agoStill too high though! There are some layer 2 systems that sit on-top of blockchain that help reduce the fees. Hopefully one day it'll be cheap for developing countries :)
- tommek4077 5y agoYou don't need to pay transaction fees on every payment. If you and your target are using the same vendor (no private wallet), there is no fee and no delay.
- Boltgolt 5y agoSo all we need to do is have everyone use the same centralized vendor/institution and bitcoin is fast and free!! Wait a second...
- tommek4077 5y agoYeah, like everyone is using the same bank. Wait a second...
- Dylan16807 5y agoThe amount of benefit is exactly proportional to the centralization. If you argue that not too many people have the same bank, you're also arguing that not too many people get free transactions.
- sgt101 5y agoCrypto can be effectively stopped - but it will take the application of violence. No one should be any illusion though - nation states who's cohesion is threatened (read : ability to raise tax) will not hesitate to use violence to preserve themselves.
- cinquemb 5y agoYup, nation states should apply violence to their own productive populations so they can collect tax in perpetuity from the dead bodies they leave in their wake.
- JamisonM 5y agoWould it not be easy for a state actor with a large amount of resorces be able to launch an attack on the network by providing most of the mining capacity for a short burst and effectively take control of the currency? I thought that was a thing.
- gruez 5y agoMiners only control transaction inclusion/ordering. That's the only thing that a 51% attack will grant you. You still can't forge coins or make unauthorized transfers. You can do double spend attacks and tank the trust of the network, but I'm skeptical whether that's actually worth it. It's probably cheaper to send death squads to users/merchants/exchanges.
- heyrhett 5y agoThings are not looking good for Bitcoin https://www.youtube.com/watch?v=c_tcg9kOfkg https://www.youtube.com/watch?v=c_tcg9kOfkg
- quenix 5y agoWhat the fuck is this?
- AgentK20 5y agoSee this article https://www.vice.com/en/article/7kv739/police-destroy-1069-bitcoin-miners-with-big-ass-steamroller-in-malaysia https://www.vice.com/en/article/7kv739/police-destroy-1069-b... And it's submission on HN three weeks ago for further discussion on it: https://news.ycombinator.com/item?id=27874794 https://news.ycombinator.com/item?id=27874794
- gruez 5y agoI fail to see how an illegal mining operation getting shut down is "not looking good for Bitcoin".