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<insert crypto rant> fiat <more crypto rant > debasing the currency. What I find ironic is that the crypto ecosystem still ended up with something like central

<insert crypto rant> fiat <more crypto rant > debasing the currency. What I find ironic is that the crypto ecosystem still ended up with something like central banks, only in this case their mandate is make money for its owners, and they have no accountability or obligation to serve the general public.

DennisP 5y ago
Play centralized games, win centralized prizes.
- rgrieselhuber 5y ago
  Exactly.
OneLeggedCat 5y ago
> crypto ecosystem still ended up It's decades from its final form.
- tmcw 5y ago
  Give it a few decades, it'll still be early, somehow.
- rzwitserloot 5y ago
  Perhaps. But we're, what? 10 years in and so far crypto has enabled 'I encrypted your data!' scams, caused political instability, been a vehicle for highly volatile investment (but the world wasn't hurting for such opportunities...), and served as a fine buzzword for dev teams around the world to get a sack of cash to update some systems. That's a pretty poor result for 10 years of this much investment and focus. The internet was waaaaaaaaaaaaay more useful 10 years in. I don't think crypto gets to claim the benefits of the oft touted protection against centralized bullies or scams. Quite the opposite: You need to go pretty deep into political dictatorships before crypto on net balance seems favourable. So far crypto coins are far more likely to be fleeced, and the vast majority of crypto holding folks are working with mostly centralized entities (such as Tether), which rate, as far as trustability and good shepherdship goes, not in a good place. Better than Pol Pot and Mugabe. Maybe. Oof. So if it's decades from its final form, when is it going to deliver on its first actually useful to humanity milestone? I'm still waiting.
  - bonestamp2 5y ago
    > so far crypto has enabled 'I encrypted your data!' scams These scams existed long before crypto. But, crypto currencies are a better solution to international money transfers so of course they became the preferred currencies for these scams.
    - varjag 5y ago
      It took crypto to make them Web scale.
    - lottin 5y ago
      If cryptocurrencies were a better solution, they would have been widely adopted. Instead, they have been adopted by people who can't use real money for one reason or another, e.g. criminals. Which tells us they are a poor substitute for real money.
      - exdsq 5y ago
        Or those without decent banking access
        lottin 5y ago
        I don't know that one can use crypto without a bank account. Is there a black market where you can buy/sell crypto with/for cash?
        exdsq 5y ago
        In several African countries people use their phone credit as a currency to barter and there are trials to use crypto instead with on/off cash ramps in the same way as the phone credit works but with the additional benefit of things like financial records to start building credit scores
        lottin 5y ago
dylan604 5y ago
> their mandate is make money for its owners, Isn't this pretty much the description of every company? I understand feduciary responsibilities blah blah, but if the company didn't think they could do both then they wouldn't be running the legitimate buisness. If it was started to intentionally dupe people that's an entirely different thing.
- lazaroclapp 5y ago
  > Isn't this pretty much the description of every company? For the most part, sure. But that's the parent's point, I think. Central banks are not companies, they are part of the public financial infrastructure of a nation (or, in the EU case, group of nations).
  - jameshart 5y ago
    > Central banks are not companies Actually... it's complicated. The Bank of England, for example, was nationalized only in 1946, and it remains technically a company which is owned by the state, not actually part of the government. In the US, the Fed is... well, it's not a company, but it's also not not a company... or group of companies... See https://en.wikipedia.org/wiki/Federal_Reserve_Bank https://en.wikipedia.org/wiki/Federal_Reserve_Bank
    - tialaramex 5y ago
      Yeah, the Bank of England even used to offer account services to employees after it was nationalized. Which would be scandalous if we found it in some dubious ex-Soviet republic today, albeit there maybe they're lending the Bank's President $10M with no real security and the Bank of England was offering employees mortgages and similar modest run-of-the-mill secured loans. The UK owns a whole bunch of banks and entities that would need a banking license if they weren't owned by the government, of which only the Bank of England acts as a central bank, but there are also a bunch of commercial banks in (or at least operating in) the UK that are named after parts of the UK even though they're not owned by the government, including the Bank of Scotland.
ChainOfFools 5y ago
decentralization is at best nothing more than a polite name for the transition period from one centralized regime to another. like all mirages, it dissolves when you get too close.
dragonwriter 5y ago
> What I find ironic is that the crypto ecosystem still ended up with something like central banks, only in this case their mandate is make money for its owners, and they have no accountability or obligation to serve the general public So, like private currency-printing banks before government monopolies (and like private banks, which subject to central regulation still create money though they don't print currency), not like central banks.
- jayd16 5y ago
  But the point of the article is that they essentially did print currency, no?
  - dragonwriter 5y ago
    The point of the article is rather that they violated the rules on creation of “money” [0] by means other than issuing legal-tender currency, and are being punished for that violation. [0] viewed broadly, but I won't quibble about that.
- majormajor 5y ago
  > So, like private currency-printing banks before government monopolies (and like private banks, which subject to central regulation still create money though they don't print currency), not like central banks. Yes, nothing prevents a crypto bank from "creating money" (aka lending) in the same way that a fiat bank does. Loan out your deposits. It's that easy. Not having it blow up on you in a run-on-the-bank scenario is the harder part than "creating the money". ;)
bko 5y ago
The difference is I can choose not to hold Tether. Removing my exposure to dollars as a US citizen is a lot harder. Not to mention people that are on a fixed income like my parents. So debasing fiat is a lot worse
- itsoktocry 5y ago
  >The difference is I can choose not to hold Tether. Removing my exposure to dollars as a US citizen is a lot harder. Did you miss the part about them lying? "I have a right to choose to buy something" for whom the value is deceptively obfuscated is quite the argument.
  - roenxi 5y ago
    If the US Fed lies, do they get fined? Pretty sure the answer is no, because they have so much power they don't need to lie. They do what they like then change the rules so they can do the same thing legally. The argument here isn't that what Tether is going is good (it isn't). It is that if the government did it, it would come with "and all you plebs have to join in because bankers making money is good for us all".
- spywaregorilla 5y ago
  That is part of being part of the society, yes.
  - anm89 5y ago
    So is having the right to hold other currencies and assets. Tell that to an Argentinian who has had their life ruined because of the lack of foresight from the the people who run their society.
    - floatingatoll 5y ago
      Incorrect, no such right is necessarily guaranteed by societies. For example, during much of the 1900s you were required to sell gold to the US government for USD rather than keep it under your mattress, and if you refused they had the right to seize it with force. For another example, negative savings interest rates in certain European countries.
matheusmoreira 5y ago
Yeah, it sucks. The problem is USD though. It taints everything it touches but people are still forced to use it. People use cryptocurrencies as an investment and convert to fiat in order to transact. They refuse to transact directly in cryptocurrencies. They would work if some country was crazy enough to sell barrels of oil for cryptocurrency, indirectly setting the price of everything else. That will probably get them invaded and destroyed by the US military for threatening the hegemony of the petrodollar.

DennisP 5y ago

Play centralized games, win centralized prizes.

rgrieselhuber 5y ago
Exactly.

OneLeggedCat 5y ago

> crypto ecosystem still ended up It's decades from its final form.

tmcw 5y ago
Give it a few decades, it'll still be early, somehow.
rzwitserloot 5y ago
Perhaps. But we're, what? 10 years in and so far crypto has enabled 'I encrypted your data!' scams, caused political instability, been a vehicle for highly volatile investment (but the world wasn't hurting for such opportunities...), and served as a fine buzzword for dev teams around the world to get a sack of cash to update some systems. That's a pretty poor result for 10 years of this much investment and focus. The internet was waaaaaaaaaaaaay more useful 10 years in. I don't think crypto gets to claim the benefits of the oft touted protection against centralized bullies or scams. Quite the opposite: You need to go pretty deep into political dictatorships before crypto on net balance seems favourable. So far crypto coins are far more likely to be fleeced, and the vast majority of crypto holding folks are working with mostly centralized entities (such as Tether), which rate, as far as trustability and good shepherdship goes, not in a good place. Better than Pol Pot and Mugabe. Maybe. Oof. So if it's decades from its final form, when is it going to deliver on its first actually useful to humanity milestone? I'm still waiting.
- bonestamp2 5y ago
  > so far crypto has enabled 'I encrypted your data!' scams These scams existed long before crypto. But, crypto currencies are a better solution to international money transfers so of course they became the preferred currencies for these scams.
  - varjag 5y ago
    It took crypto to make them Web scale.
  - lottin 5y ago
    If cryptocurrencies were a better solution, they would have been widely adopted. Instead, they have been adopted by people who can't use real money for one reason or another, e.g. criminals. Which tells us they are a poor substitute for real money.
    - exdsq 5y ago
      Or those without decent banking access
      - lottin 5y ago
        I don't know that one can use crypto without a bank account. Is there a black market where you can buy/sell crypto with/for cash?
        exdsq 5y ago
        In several African countries people use their phone credit as a currency to barter and there are trials to use crypto instead with on/off cash ramps in the same way as the phone credit works but with the additional benefit of things like financial records to start building credit scores
        lottin 5y ago

dylan604 5y ago

> their mandate is make money for its owners, Isn't this pretty much the description of every company? I understand feduciary responsibilities blah blah, but if the company didn't think they could do both then they wouldn't be running the legitimate buisness. If it was started to intentionally dupe people that's an entirely different thing.

lazaroclapp 5y ago
> Isn't this pretty much the description of every company? For the most part, sure. But that's the parent's point, I think. Central banks are not companies, they are part of the public financial infrastructure of a nation (or, in the EU case, group of nations).
- jameshart 5y ago
  > Central banks are not companies Actually... it's complicated. The Bank of England, for example, was nationalized only in 1946, and it remains technically a company which is owned by the state, not actually part of the government. In the US, the Fed is... well, it's not a company, but it's also not not a company... or group of companies... See https://en.wikipedia.org/wiki/Federal_Reserve_Bank https://en.wikipedia.org/wiki/Federal_Reserve_Bank
  - tialaramex 5y ago
    Yeah, the Bank of England even used to offer account services to employees after it was nationalized. Which would be scandalous if we found it in some dubious ex-Soviet republic today, albeit there maybe they're lending the Bank's President $10M with no real security and the Bank of England was offering employees mortgages and similar modest run-of-the-mill secured loans. The UK owns a whole bunch of banks and entities that would need a banking license if they weren't owned by the government, of which only the Bank of England acts as a central bank, but there are also a bunch of commercial banks in (or at least operating in) the UK that are named after parts of the UK even though they're not owned by the government, including the Bank of Scotland.

ChainOfFools 5y ago

decentralization is at best nothing more than a polite name for the transition period from one centralized regime to another. like all mirages, it dissolves when you get too close.

dragonwriter 5y ago

> What I find ironic is that the crypto ecosystem still ended up with something like central banks, only in this case their mandate is make money for its owners, and they have no accountability or obligation to serve the general public So, like private currency-printing banks before government monopolies (and like private banks, which subject to central regulation still create money though they don't print currency), not like central banks.

jayd16 5y ago
But the point of the article is that they essentially did print currency, no?
- dragonwriter 5y ago
  The point of the article is rather that they violated the rules on creation of “money” [0] by means other than issuing legal-tender currency, and are being punished for that violation. [0] viewed broadly, but I won't quibble about that.
majormajor 5y ago
> So, like private currency-printing banks before government monopolies (and like private banks, which subject to central regulation still create money though they don't print currency), not like central banks. Yes, nothing prevents a crypto bank from "creating money" (aka lending) in the same way that a fiat bank does. Loan out your deposits. It's that easy. Not having it blow up on you in a run-on-the-bank scenario is the harder part than "creating the money". ;)

bko 5y ago

The difference is I can choose not to hold Tether. Removing my exposure to dollars as a US citizen is a lot harder. Not to mention people that are on a fixed income like my parents. So debasing fiat is a lot worse

itsoktocry 5y ago
>The difference is I can choose not to hold Tether. Removing my exposure to dollars as a US citizen is a lot harder. Did you miss the part about them lying? "I have a right to choose to buy something" for whom the value is deceptively obfuscated is quite the argument.
- roenxi 5y ago
  If the US Fed lies, do they get fined? Pretty sure the answer is no, because they have so much power they don't need to lie. They do what they like then change the rules so they can do the same thing legally. The argument here isn't that what Tether is going is good (it isn't). It is that if the government did it, it would come with "and all you plebs have to join in because bankers making money is good for us all".
spywaregorilla 5y ago
That is part of being part of the society, yes.
- anm89 5y ago
  So is having the right to hold other currencies and assets. Tell that to an Argentinian who has had their life ruined because of the lack of foresight from the the people who run their society.
  - floatingatoll 5y ago
    Incorrect, no such right is necessarily guaranteed by societies. For example, during much of the 1900s you were required to sell gold to the US government for USD rather than keep it under your mattress, and if you refused they had the right to seize it with force. For another example, negative savings interest rates in certain European countries.

matheusmoreira 5y ago

Yeah, it sucks. The problem is USD though. It taints everything it touches but people are still forced to use it. People use cryptocurrencies as an investment and convert to fiat in order to transact. They refuse to transact directly in cryptocurrencies. They would work if some country was crazy enough to sell barrels of oil for cryptocurrency, indirectly setting the price of everything else. That will probably get them invaded and destroyed by the US military for threatening the hegemony of the petrodollar.