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Someone recently pointed out that we have a "free market" in cryptocurrency, and are now spending years discovering why we have regulations, laws, contracts, co

Someone recently pointed out that we have a "free market" in cryptocurrency, and are now spending years discovering why we have regulations, laws, contracts, courts etc. I love the idea of a digital native currency. But I also love financial protections that have grown up over thousands of years. The mints of each country could solve that tomorrow (is there a FOSS blockchain already that does a "we know there are 1 trillion Euros in existence, here are the tokens, no need for mining"?)

jobigoud 5y ago
Re your last paragraph, isn't this what pegged cryptocurrencies are? You couldn't have the same amount circulating in both fiat and crypto at the same time so they make reserves of cash while issuing tokens, but it's pretty fragile because you have to trust the issuer they actually have the reserves.
- lifeisstillgood 5y ago
  Yes. But instead of trusting that (is it Binace?) has a million dollars in the bank (no really honestly !) you are trusting that say the US government has. Full faith etc. It sounds simple but even a moment makes for some hard problems. Amount of actual cash in circulation - yeah that's fine the US Mint probably has a spreadsheet. So we could just go with that. Let's say that's 10% of the "total". But who uses cash these days? You want all the currency in bank accounts denominated in US dollars - ok we just go ask CitiBank et al. Now that probably gets us to 70%. Now we hit the hard stuff. The dodgy bank accounts (That's going to be fun one - hiding money off shore. We are about to make any dollars not "registered" effectively unspendable) Now what about things that are not really US dollars but convertible? There are a thousand weird instruments I barely have heard of. God knows if they should get a UUID? And loans - look everyone loves to rag on fractional banking but we want the amount of currency in circulation to prety much match the value. Having banks create currency at the margin works pretty well as a distributed solution (we like those). Imagine the federal government assessing what your widget factory is worth every ten years. Do we stop banks doing that? do they hand out UUIDs as well? Will there be two tier currencies (see Scottish banks). It should be a simple solution, but nah.
capableweb 5y ago
> I love the idea of a digital native currency. But I also love financial protections that have grown up over thousands of years. Yeah, this is a contrast/friction that exists in the ecosystem. Some people just want something that is like a "digital native currency" that works kind of like banks today (with the same protections at least) but works across banks/applications and somehow also is at a fixed value. Others want "decentralized cryptocurrencies" that works the same as described before, but without any centralized control or issuance and without the "protections" as the protections can also be used against people, not just for. Neither is "right" or "correct", just two different views inhabiting the same ecosystem.
- dmantis 5y ago
  The second group doesn't touch the first group (e.g. just use coinbase custody and forget about that "unlawful anarchists"), but the first group always want to regulate the second. Like they doing something wrong voluntarily rejecting financial protection for their own property and asking for more privacy, independence and less taxes. Why not drop both protection and regulations for that protection from the second group and not bothering anyone?
  - lifeisstillgood 5y ago
    Because the sound unregulated one looks like, walks like and talks like the first regulated one. Just imagine there were realtors split into two similar camps, and you bought your house only to find it was a hollywood facade and people just laughed when you complained. Nah - we have this nanny like state because there are millions and millions of people and despite what Libertarians say, they cant all pay that much attention all the time. Honestly the only way most of us make it through a year is because all the shit we rely on just does as it is expected. In short, if you can't trust one politician/bank/sewage plant it breaks faith in all politicians/banks/sewage plants - That's no good for anyone
wraptile 5y ago
> now spending years discovering why we have regulations, laws, contracts, courts etc. Which is funny as for the longest time crypto's argument was that FIAT regulations/manipulation only protects the rich, not individuals. Well here we are talking about network that rolled back because some rich people lost money and another example of organizing one of the biggest manhunts in crypto history because of a code bug abuse. Yet average people who lose money are being told "code is law", should have watched your keys or made smarter investments fool! Maybe medium is not the issue here...

jobigoud 5y ago

Re your last paragraph, isn't this what pegged cryptocurrencies are? You couldn't have the same amount circulating in both fiat and crypto at the same time so they make reserves of cash while issuing tokens, but it's pretty fragile because you have to trust the issuer they actually have the reserves.

lifeisstillgood 5y ago
Yes. But instead of trusting that (is it Binace?) has a million dollars in the bank (no really honestly !) you are trusting that say the US government has. Full faith etc. It sounds simple but even a moment makes for some hard problems. Amount of actual cash in circulation - yeah that's fine the US Mint probably has a spreadsheet. So we could just go with that. Let's say that's 10% of the "total". But who uses cash these days? You want all the currency in bank accounts denominated in US dollars - ok we just go ask CitiBank et al. Now that probably gets us to 70%. Now we hit the hard stuff. The dodgy bank accounts (That's going to be fun one - hiding money off shore. We are about to make any dollars not "registered" effectively unspendable) Now what about things that are not really US dollars but convertible? There are a thousand weird instruments I barely have heard of. God knows if they should get a UUID? And loans - look everyone loves to rag on fractional banking but we want the amount of currency in circulation to prety much match the value. Having banks create currency at the margin works pretty well as a distributed solution (we like those). Imagine the federal government assessing what your widget factory is worth every ten years. Do we stop banks doing that? do they hand out UUIDs as well? Will there be two tier currencies (see Scottish banks). It should be a simple solution, but nah.

capableweb 5y ago

> I love the idea of a digital native currency. But I also love financial protections that have grown up over thousands of years. Yeah, this is a contrast/friction that exists in the ecosystem. Some people just want something that is like a "digital native currency" that works kind of like banks today (with the same protections at least) but works across banks/applications and somehow also is at a fixed value. Others want "decentralized cryptocurrencies" that works the same as described before, but without any centralized control or issuance and without the "protections" as the protections can also be used against people, not just for. Neither is "right" or "correct", just two different views inhabiting the same ecosystem.

dmantis 5y ago
The second group doesn't touch the first group (e.g. just use coinbase custody and forget about that "unlawful anarchists"), but the first group always want to regulate the second. Like they doing something wrong voluntarily rejecting financial protection for their own property and asking for more privacy, independence and less taxes. Why not drop both protection and regulations for that protection from the second group and not bothering anyone?
- lifeisstillgood 5y ago
  Because the sound unregulated one looks like, walks like and talks like the first regulated one. Just imagine there were realtors split into two similar camps, and you bought your house only to find it was a hollywood facade and people just laughed when you complained. Nah - we have this nanny like state because there are millions and millions of people and despite what Libertarians say, they cant all pay that much attention all the time. Honestly the only way most of us make it through a year is because all the shit we rely on just does as it is expected. In short, if you can't trust one politician/bank/sewage plant it breaks faith in all politicians/banks/sewage plants - That's no good for anyone

wraptile 5y ago

> now spending years discovering why we have regulations, laws, contracts, courts etc. Which is funny as for the longest time crypto's argument was that FIAT regulations/manipulation only protects the rich, not individuals. Well here we are talking about network that rolled back because some rich people lost money and another example of organizing one of the biggest manhunts in crypto history because of a code bug abuse. Yet average people who lose money are being told "code is law", should have watched your keys or made smarter investments fool! Maybe medium is not the issue here...