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This is exactly what would happen if Argentinians started using cryptocurrency in large numbers, and the government found out about it. A government that wants

This is exactly what would happen if Argentinians started using cryptocurrency in large numbers, and the government found out about it. A government that wants tight control over currency exchange will treat crypto the same way it treats other foreign currency: limit exchange, or ban it, etc.

notch656a 5y ago
Governments haven't been able to stop the flow of tangible drugs and you think they can successfully ban crypto?
- hammyhavoc 5y ago
  Last time I checked, blocking ports, domains, IP ranges, et al was trivial in China. A ban doesn't mean that something stops, a ban means that it becomes extremely difficult, a punishable crime, and the risk-to-reward ratio becomes significantly diminished. Likewise, the inverse is also true. CB radio was illegal in the UK, but it was hugely popular, then, overnight, upon it being made legal, it died. Most people lost interest because it was no longer exciting. You see the same thing with legalizing cannabis. Sure, you'll get hardcore consumers and enthusiasts, and people using it for medical reasons, but it's no longer cool/edgy/interesting, and when it is so accessible. Could really go either way, but when it comes to money, people don't tend to fuck around.
  - notch656a 5y ago
    If you think crypto is gone from China, I tihnk you may be mistaken. Argentina isn't the US or UK. There was a video an Argentinian pointed out to me of a vendor selling black-market goods right in front of the tax office. No one gives a fuck. Violating Argentina's insane tax code is sport for their populace. Once you become big enough corruption and ol boy network with the tax authorities will negotiate what percent of your income you lie about, usually you keep like 70% off the books by the account of one accountant from a large construction company I interacted with.
    - hammyhavoc 5y ago
      I never said it was gone. Did you read the comment properly? "A ban doesn't mean that something stops, a ban means that it becomes extremely difficult, a punishable crime, and the risk-to-reward ratio becomes significantly diminished." I think I was crystal clear.
      - notch656a 5y ago
        Ok glad you agree it can't be stopped. It definitely is not extremely difficult. Even tangible stuff like pot that doesn't have nearly the value density (you can fit billions of USD crypto on a wallet stored on memory smaller than 1/8th bag of pot) was extraordinarily easy to obtain for me as a kid in a place where it was illegal both by state and federal government's law. And there's no drug dog to sniff it out. A chinese citizen could laughably easily obtain crypto.
        hammyhavoc 5y ago
        Packet sniffing is absolutely a thing that cryptocurrency is susceptible to, and can be automated. https://exploitbyte.com/sniffing-cryptocurrency-traffic/ https://exploitbyte.com/sniffing-cryptocurrency-traffic/
        notch656a 5y ago
        I'm no security expert but I'm nearly certain that is defeated by using a VPN or tor or some other way of obfuscating your traffic.
        hammyhavoc 5y ago
        Sure, but this all starts to become far too complex for the average citizen. The average citizen that just about managed to wrap their brain around crypto in a semi-OK UX is going to get caught out. I know ex-military folks that can survive in the wilderness just fine, but your average person wouldn't, and this is about the 99%, not the 1%. What next? The phones available in the country have a specific ROM that doesn't offer VPNs? Already happening. Not even accounting for leaks in VPNs, and whether someone can trust a VPN provider. We already know that the major providers sell netflow data.
- leifg 5y ago
  While "banning crypto" is a challenging task, making cryptocurrency useless in your jurisdiction is extremely easy. prohibit any business to accept crypto as payment, ban crypto exchanges from operating in your country, ban banks of your country to accept transaction that they suspect coming from cryptocurrency exchanges You can still have your crypto wallet, but what use is it if you can't exchange it in your local currency? You can always meet someone in an ally or travel outside the country and bring cash back in but these are solutions that don't scale.
  - notch656a 5y ago
    They do scale and you merely have to witness the insane amount of black-market trade between relatively low tax Paraguay and Brazil/Argentina to see that. The border between Argentina and Paraguay doesn't even have passport controls most the time, let alone customs. Also just because crypto can't be spent by most local vendors doesn't mean it's not valuable. Stocks can't be spent either but if you had a traditional bearer certificate like in the old days (paper stock with no owner except by merely holding the paper) it was just fine for trade and people did just that in the Weimar Republic when they had hyperinflation. Worst case you can just spend the crypto in foreign location, import the goods and sell them locally.
    - leifg 5y ago
      Aren't Paraguay, Brazil and Argentina in the same trade union? I don't know the details of Mercosur but in the EU you can buy whatever you want in any other EU country and take it back home without the need for customs. Where is the black market part of that trade? As for your trade example I would like to see the details of that. There are not a lot of vendors that accept crypto and those who do, use 3rd parties which then usually require some amount of KYC (even if it's is minimal). Combine that with how many vendors are actually able/willing to ship to the country in question and you are left with a very small set of online stores. Add shipping costs and custom fees that will eat in your margin. So yes in theory you can setup an import/export company empire in order to exchange your crypto into local currency but that is pretty much the definition of "not scaling". My point is: if a country wants to make cryptocurrency useless they can totally do it.
- geofft 5y ago
  Tangible drugs have inherent value: once you have the physical object, you can get high in the privacy of your own home with no further interaction with anyone. Cryptocurrency, fiat currencies, and arguably even metal coins derive their value from the existence of a market which will take them. Bring a bitcoin (as in a wallet private key, not the concept) to 1990 and nobody will pay you for it. Therefore, a government doesn't need to ban you owning cryptocurrency - it just needs to crack down on the businesses you would spend it at accepting your cryptocurrency. And it doesn't really even need to ban that, it just needs to crack down on their suppliers, and so forth. Your local pizza place that takes Bitcoin only accepts it because that money is in turn spendable by them to buy flour and oil and cheese - either directly, or by giving it to someone who will give them local currency with which they can buy flour and oil and cheese. If the government presses hard enough on those links, your local pizza place will stop taking Bitcoin, and then they won't have to ban you from owning Bitcoin at all, you won't be able to do anything with it.
  - soperj 5y ago
    Why oil in the pizza? That doesn't make sense to me (as someone who makes pizza regularly)
    - kergonath 5y ago
      Not starting a holy war (and endless discussions about the nature of pizza and whether the Truth is in Rome, Naples, or New York), but it is quite common to put some oil in the dough. It makes it easier to work with, more homogeneous, lighter (but thicker), and it cooks a bit different.
- amalcon 5y ago
  I'd think they can ban cryptocurrency about as effectively as they can ban foreign currency (which is to say, not very). If you're willing and able to break that particular law, it's not really an argument in favor of cryptocurrency.
  - notch656a 5y ago
    You think smuggling tangible goods is easier than smuggling digital goods? I think it's an incredible argument in favor of cryptocurrency. Smugglers who break the law like to minimize risk.
    - amalcon 5y ago
      I don't think either of those things is particularly difficult.

notch656a 5y ago

Governments haven't been able to stop the flow of tangible drugs and you think they can successfully ban crypto?

hammyhavoc 5y ago
Last time I checked, blocking ports, domains, IP ranges, et al was trivial in China. A ban doesn't mean that something stops, a ban means that it becomes extremely difficult, a punishable crime, and the risk-to-reward ratio becomes significantly diminished. Likewise, the inverse is also true. CB radio was illegal in the UK, but it was hugely popular, then, overnight, upon it being made legal, it died. Most people lost interest because it was no longer exciting. You see the same thing with legalizing cannabis. Sure, you'll get hardcore consumers and enthusiasts, and people using it for medical reasons, but it's no longer cool/edgy/interesting, and when it is so accessible. Could really go either way, but when it comes to money, people don't tend to fuck around.
- notch656a 5y ago
  If you think crypto is gone from China, I tihnk you may be mistaken. Argentina isn't the US or UK. There was a video an Argentinian pointed out to me of a vendor selling black-market goods right in front of the tax office. No one gives a fuck. Violating Argentina's insane tax code is sport for their populace. Once you become big enough corruption and ol boy network with the tax authorities will negotiate what percent of your income you lie about, usually you keep like 70% off the books by the account of one accountant from a large construction company I interacted with.
  - hammyhavoc 5y ago
    I never said it was gone. Did you read the comment properly? "A ban doesn't mean that something stops, a ban means that it becomes extremely difficult, a punishable crime, and the risk-to-reward ratio becomes significantly diminished." I think I was crystal clear.
    - notch656a 5y ago
      Ok glad you agree it can't be stopped. It definitely is not extremely difficult. Even tangible stuff like pot that doesn't have nearly the value density (you can fit billions of USD crypto on a wallet stored on memory smaller than 1/8th bag of pot) was extraordinarily easy to obtain for me as a kid in a place where it was illegal both by state and federal government's law. And there's no drug dog to sniff it out. A chinese citizen could laughably easily obtain crypto.
      - hammyhavoc 5y ago
        Packet sniffing is absolutely a thing that cryptocurrency is susceptible to, and can be automated. https://exploitbyte.com/sniffing-cryptocurrency-traffic/ https://exploitbyte.com/sniffing-cryptocurrency-traffic/
        notch656a 5y ago
        I'm no security expert but I'm nearly certain that is defeated by using a VPN or tor or some other way of obfuscating your traffic.
        hammyhavoc 5y ago
        Sure, but this all starts to become far too complex for the average citizen. The average citizen that just about managed to wrap their brain around crypto in a semi-OK UX is going to get caught out. I know ex-military folks that can survive in the wilderness just fine, but your average person wouldn't, and this is about the 99%, not the 1%. What next? The phones available in the country have a specific ROM that doesn't offer VPNs? Already happening. Not even accounting for leaks in VPNs, and whether someone can trust a VPN provider. We already know that the major providers sell netflow data.
leifg 5y ago
While "banning crypto" is a challenging task, making cryptocurrency useless in your jurisdiction is extremely easy. prohibit any business to accept crypto as payment, ban crypto exchanges from operating in your country, ban banks of your country to accept transaction that they suspect coming from cryptocurrency exchanges You can still have your crypto wallet, but what use is it if you can't exchange it in your local currency? You can always meet someone in an ally or travel outside the country and bring cash back in but these are solutions that don't scale.
- notch656a 5y ago
  They do scale and you merely have to witness the insane amount of black-market trade between relatively low tax Paraguay and Brazil/Argentina to see that. The border between Argentina and Paraguay doesn't even have passport controls most the time, let alone customs. Also just because crypto can't be spent by most local vendors doesn't mean it's not valuable. Stocks can't be spent either but if you had a traditional bearer certificate like in the old days (paper stock with no owner except by merely holding the paper) it was just fine for trade and people did just that in the Weimar Republic when they had hyperinflation. Worst case you can just spend the crypto in foreign location, import the goods and sell them locally.
  - leifg 5y ago
    Aren't Paraguay, Brazil and Argentina in the same trade union? I don't know the details of Mercosur but in the EU you can buy whatever you want in any other EU country and take it back home without the need for customs. Where is the black market part of that trade? As for your trade example I would like to see the details of that. There are not a lot of vendors that accept crypto and those who do, use 3rd parties which then usually require some amount of KYC (even if it's is minimal). Combine that with how many vendors are actually able/willing to ship to the country in question and you are left with a very small set of online stores. Add shipping costs and custom fees that will eat in your margin. So yes in theory you can setup an import/export company empire in order to exchange your crypto into local currency but that is pretty much the definition of "not scaling". My point is: if a country wants to make cryptocurrency useless they can totally do it.
geofft 5y ago
Tangible drugs have inherent value: once you have the physical object, you can get high in the privacy of your own home with no further interaction with anyone. Cryptocurrency, fiat currencies, and arguably even metal coins derive their value from the existence of a market which will take them. Bring a bitcoin (as in a wallet private key, not the concept) to 1990 and nobody will pay you for it. Therefore, a government doesn't need to ban you owning cryptocurrency - it just needs to crack down on the businesses you would spend it at accepting your cryptocurrency. And it doesn't really even need to ban that, it just needs to crack down on their suppliers, and so forth. Your local pizza place that takes Bitcoin only accepts it because that money is in turn spendable by them to buy flour and oil and cheese - either directly, or by giving it to someone who will give them local currency with which they can buy flour and oil and cheese. If the government presses hard enough on those links, your local pizza place will stop taking Bitcoin, and then they won't have to ban you from owning Bitcoin at all, you won't be able to do anything with it.
- soperj 5y ago
  Why oil in the pizza? That doesn't make sense to me (as someone who makes pizza regularly)
  - kergonath 5y ago
    Not starting a holy war (and endless discussions about the nature of pizza and whether the Truth is in Rome, Naples, or New York), but it is quite common to put some oil in the dough. It makes it easier to work with, more homogeneous, lighter (but thicker), and it cooks a bit different.
amalcon 5y ago
I'd think they can ban cryptocurrency about as effectively as they can ban foreign currency (which is to say, not very). If you're willing and able to break that particular law, it's not really an argument in favor of cryptocurrency.
- notch656a 5y ago
  You think smuggling tangible goods is easier than smuggling digital goods? I think it's an incredible argument in favor of cryptocurrency. Smugglers who break the law like to minimize risk.
  - amalcon 5y ago
    I don't think either of those things is particularly difficult.