4 ms·

> You don't need permission to use cash Really? The one dollar bill you can go anywhere and spend has this ability due to legislation, or as you maye describe,

> You don't need permission to use cash Really? The one dollar bill you can go anywhere and spend has this ability due to legislation, or as you maye describe, permission from the government. It has the Seal of the Federal Reserve and The Treasury Department on it. In turn these institutions can withdraw at any point in time these dollar bills from circulation rendering them worthless. With crypto, you need permission from the blockchain.

nextaccountic 5y ago
People don't specifically care about the government when they accept cash. It's fungible, they just accept and pass it along. The US government has control of the monetary policy (and can thus tank the currency if they wish) but it has no control on how you spend a specific bill you carry.
- shapefrog 5y ago
  And the reason it is fungible is that it has the backing of the US Government, US Treasury and Federal Reserve. People might not 'care' about the govenement when they use cash, but try and pay with something that doesnt have some backing - say for example small rocks. They too are fungible, you can buy bags of them at any good hardware store. They are decentralised, trustless, effectively untraceable and could in theory be exchanged for goods and services, if both parties were willing.
nextaccountic 5y ago
About needing permission from the blockchain.. the challenge is exactly how to make a permissionless, non-censorable blockchain! Indeed in many (but not all) cryptocurrencies, if the miners collude they can censor a given transaction they don't like[0]. This is pretty bad, but at least it can't happen in secret: if and when a transaction is censored, we can always point to a specific transaction in mempool that is getting ignored. Privacy coins like Zcash and Monero makes it infeasible to track who is transacting with who, and thus can only be completely shut down or not at all. At the moment, they are the best bet for people that want a permissionless digital currency. A lot of work in the crypto space is being done to tackle this problem[1], and most people in this space reckons this as a real problem. It's not fully solved, but this wasn't claimed: as said before, cryptocurrencies are indeed incomplete solutions. [0] In Bitcoin there's a group of miners that is attempting to censor transactions based on US law https://www.coindesk.com/tech/2021/05/07/marathon-miners-have-started-censoring-bitcoin-transactions-heres-what-that-means/ https://www.coindesk.com/tech/2021/05/07/marathon-miners-hav... - and they are willing to give up a lot of money in the process. So far they control less than 50% of the network so they can't really enforce their views. And all of this just means that Bitcoin is indeed censorable. [1] Here's 6 yers old blog post about this on Ethereum https://blog.ethereum.org/2015/06/06/the-problem-of-censorship/ https://blog.ethereum.org/2015/06/06/the-problem-of-censorsh... - with censorship, Bitcoin might ban some drug dealers from transacting; but Ethereum, being a smart contract platform, would be totally worthless to enforce contracts. So they have an incentive to solve this.

nextaccountic 5y ago

People don't specifically care about the government when they accept cash. It's fungible, they just accept and pass it along. The US government has control of the monetary policy (and can thus tank the currency if they wish) but it has no control on how you spend a specific bill you carry.

shapefrog 5y ago
And the reason it is fungible is that it has the backing of the US Government, US Treasury and Federal Reserve. People might not 'care' about the govenement when they use cash, but try and pay with something that doesnt have some backing - say for example small rocks. They too are fungible, you can buy bags of them at any good hardware store. They are decentralised, trustless, effectively untraceable and could in theory be exchanged for goods and services, if both parties were willing.

nextaccountic 5y ago

About needing permission from the blockchain.. the challenge is exactly how to make a permissionless, non-censorable blockchain! Indeed in many (but not all) cryptocurrencies, if the miners collude they can censor a given transaction they don't like[0]. This is pretty bad, but at least it can't happen in secret: if and when a transaction is censored, we can always point to a specific transaction in mempool that is getting ignored. Privacy coins like Zcash and Monero makes it infeasible to track who is transacting with who, and thus can only be completely shut down or not at all. At the moment, they are the best bet for people that want a permissionless digital currency. A lot of work in the crypto space is being done to tackle this problem[1], and most people in this space reckons this as a real problem. It's not fully solved, but this wasn't claimed: as said before, cryptocurrencies are indeed incomplete solutions. [0] In Bitcoin there's a group of miners that is attempting to censor transactions based on US law https://www.coindesk.com/tech/2021/05/07/marathon-miners-have-started-censoring-bitcoin-transactions-heres-what-that-means/ https://www.coindesk.com/tech/2021/05/07/marathon-miners-hav... - and they are willing to give up a lot of money in the process. So far they control less than 50% of the network so they can't really enforce their views. And all of this just means that Bitcoin is indeed censorable. [1] Here's 6 yers old blog post about this on Ethereum https://blog.ethereum.org/2015/06/06/the-problem-of-censorship/ https://blog.ethereum.org/2015/06/06/the-problem-of-censorsh... - with censorship, Bitcoin might ban some drug dealers from transacting; but Ethereum, being a smart contract platform, would be totally worthless to enforce contracts. So they have an incentive to solve this.