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> This concentration not only risks to threaten blockchain's own premises [...] BTC was designed specifically to avoid any kind of _state control_ and by _stat

by atmosx 5y ago

> This concentration not only risks to threaten blockchain's own premises [...] BTC was designed specifically to avoid any kind of _state control_ and by _state control_ I mean something along the lines of a central bank. Adding protections here and there will inevitably lead to a system that is similar to current financial system with all the bells and whistles. I think you're missing the point: BTC tries to sell lack of any kind of control (or protection, however you want to call it) as a _feature_.

micromacrofoot 5y ago
so instead we have “not banks” that are less accountable?
- maxwell86 5y ago
  bitcoin has no banks, period.
  - micromacrofoot 5y ago
    right, most people keep their crypto in exchanges which are definitely not just worse banks
    - ur-whale 5y ago
      > most people keep their crypto in exchanges Do they? What is your evidence for this? Also, if we assume they do, well ... their BTC is now potentially subject to seizure, hacking, fees, bankrupt exchanges ... well, their choice. Darwinism at work as far as I'm concerned. Not you keys, not your coins.
    - jonathan-adly 5y ago
      source: trust me bro! Bitcoin maxis literally go insane telling people to take their coins off exchanges. It's part of the dogma.
    - randomhodler84 5y ago
      Most people don’t. In fact there are only 1.3M BTC left in exchanges today out of 18.9M BTC that exist. There is about 250k BTC on ETH as WBTC, the largest secondary pool in escrow. Ren has about 18K BTC in escrow. Lightning network is about 3k BTC.
      - micromacrofoot 5y ago
        measuring all bitcoin in existence is a bit misleading because a significant 95% is locked up with 2% of accounts… which is the point of OP
    - maxwell86 5y ago
      My dog is closer to a bank than an exchange is.
      - micromacrofoot 5y ago
        your dog might also be more reliable
EMM_386 5y ago
The silly thing is that crypto is now following the stock market for the most part, at least the big coins like BTC/LTC/Doge/etc are. Market goes down, crypto seems to go down with it. Look at something like 1-month BTC and 1-month APPL or something. It's not supposed to be doing this. I think this is happening because it's become so easy to purchase that people now just have it in their "portfolio", basket of everything, and when they want to sell, they just sell everything, stocks and crypto. They are the same thing to a lot of people. This means it is getting tied into the existing financial system anyway, even without specific "controls" like central banking.
- saurik 5y ago
  > It's not supposed to be doing this. Is it really not? Both stocks and cryptocurrencies act as inflation hedges against the central bank.
  - grey-area 5y ago
    It’s really not. It is highly correlated with high risk assets and growth shares. It is anything but an inflation hedge, which is why it has been plunging as inflation rises and will fall more if interest rates rise. If it were an actual currency things might be different, but instead it’s just another high risk speculative asset.
    - ashwagary 5y ago
      Just because BTC is temporarily correlated with risk assets, that doesnt mean it wont change. Also, it's better to look at charts by starting at the beginnning of this 4 year cycle, dont pick out a bearish 6 month period and falsely claim BTC fails the inflation test. Short termism and Bitcoin's monetary policy are incompatible.
      - zepto 5y ago
        It certainly fails the inflation test without any doubt today. You seem to be saying that it might pass it in the future.
300bps 5y ago
lack of any kind of control Multiple choice question: Which of the following groups have lots of control over BTC? A. BTC Core Developers B. BTC Exchanges C. Credit Card Processors/ACH Entities/Payment apps that allow people to buy BTC from fiat without exchanging physical cash D. BTC Miners E. Any judge in the country that can order you to hand over your BTC just like he/she can order you to dig up the cash he/she suspects you have and hand it over. F. All of the above and many more (It's F)
- baby 5y ago
  Proof that it’s F is that the protocol is extremely slow to change.
- jasode 5y ago
  I understand your larger point but to be fair to gp you're responding to, he was scoping the word "control" to Central Bank since he actually wrote: >and by _state control_ I mean something along the lines of a central bank. So central bank control would be something like "expansion of money supply beyond 21 million bitcoins". Therefore, your options (B) Coinbase/Binance (C) Visa/MC/banks and (E) courts -- really have no "control" over that "central bankish" aspect. EDIT reply to: >Central banks [...] don't have complete control about the money supply, because commercial banks also create money via fractional reserves. The Federal Reserve (central bank) in USA is the entity that adjusts the fractional reserve requirement. https://en.wikipedia.org/wiki/Federal_Reserve#Reserve_requirements https://en.wikipedia.org/wiki/Federal_Reserve#Reserve_requir... > The idea that no one can expand the supply of bitcoins beyond 21 million is a nothing but fairy tale. It could theoretically be done but it would require the coordination of the Bitcoin developers + miners + node validators. A crypto-exchange like Coinbase can't do it. As a previous case study, Coinbase was part of the group that aligned with majority miners to change the Bitcoin protocol to increase the block size -- but all that influence and miner support still couldn't get the Bitcoin network to adopt it.
  - lottin 5y ago
    This is a misunderstanding of how the money supply works. Central banks have a legal monopoly on the issuance of currency, but they don't have complete control about the money supply, because commercial banks also create money via fractional reserves. Over 80% of the money in circulation is created in this way by commercial banks. And this applies to bitcoin as well. Crypto-exchanges can expand the supply of any crypto-currency by creating deposits that aren't fully backed with reserves. The idea that no one can expand the supply of bitcoins beyond 21 million is a nothing but fairy tale.
mrtksn 5y ago
I’m baffled how people miss this even if it’s the mission statement of Satoshi himself: Bitcoin is a tool to prevent wealth re-distribution. It’s whole idea is to ensure that the accumulated wealth is preserved. In 2008 it was against the government bailing out the failed banks but it’s also against any government interventions, including easing the wealth inequality. In essence, the idea is that if a teenager in 2010 acquired 10,000BTC the society owes him food, shelter and luxury for generations to come. It’s like being a landlord whom passive income guarantees him and his family a good life with no work when people working their arses off to be able to pay the rent.
- iszomer 5y ago
  > It’s like being a landlord whom passive income guarantees him and his family a good life with no work when people working their arses off to be able to pay the rent. Not necessarily. The state still takes a percentage eg: property tax, maintenance, utilities, safety certifications, etc.
- sqrt17 5y ago
  The difference being that BTC has no utility that people depend on. They can refuse to buy the BTC from the now-GenZer or even the Winklevoss twins if they'd rather have food or shelter or a chanel bag rather than BTC. The real world phenomenon that this corresponds to is consumer price inflation or asset price inflation (assuming your asset is production capacity and the medium of exchange is BTC) Being a landlord, or being an oil baron in an economy that is dependent on petrol, is different because people actually need those things. So antidemocratic aristocrats who inherited a land with substantial oil reserves can now buy lots of startups via softbank or build artificial cities because our cheapest way to acquire petrol is still to dig it out of the ground in those countries where reserves accumulated in the last millions of years, and pay local rulers for the permission to do it.
  - imtringued 5y ago
    If we assume that we should maintain the current scarce currency system, then the only solution would be to have multiple competing scarce currencies. However, Bitcoin is not really competing against anything except maybe gold.
beloch 5y ago
Control by a few anonymous individuals with totally unknown interests is not an improvement on control by state entities whose interests are widely known.
bee_rider 5y ago
Inequality can be measured by non-state entities, and would seem to provide (for example) useful signals to investors about the health of the ecosystem. I think bitcoins/cryptocurrency are largely bullshit and agree that their value proposition mostly comes from the promise to avoid regulation. But we shouldn't pretend that it is impossible for markets to do any sort of introspection without the force of law behind it. And in the case of bitcoin, they do at least know which wallets own which coins, right? Seems easier to track than cash.
imtringued 5y ago
Yeah and in that sense it is basically the same as gold. Gold is a tool to entrench power. Bitcoin is a tool to entrench power. Conventional fiat currency is also a tool designed to entrench power. All of these so called "scarce" currencies achieved exactly what they were designed for. The ideal that Bitcoin lets you escape the current financial dogmas is completely wrong, it's a parody of the existing system. Something like Freicoin would be more appropriate as an alternative, e.g. an "abundant" currency that always makes itself available to anyone who wants to trade.

by atmosx 5y ago

micromacrofoot 5y ago

so instead we have “not banks” that are less accountable?

maxwell86 5y ago
bitcoin has no banks, period.
- micromacrofoot 5y ago
  right, most people keep their crypto in exchanges which are definitely not just worse banks
  - ur-whale 5y ago
    > most people keep their crypto in exchanges Do they? What is your evidence for this? Also, if we assume they do, well ... their BTC is now potentially subject to seizure, hacking, fees, bankrupt exchanges ... well, their choice. Darwinism at work as far as I'm concerned. Not you keys, not your coins.
  - jonathan-adly 5y ago
    source: trust me bro! Bitcoin maxis literally go insane telling people to take their coins off exchanges. It's part of the dogma.
  - randomhodler84 5y ago
    Most people don’t. In fact there are only 1.3M BTC left in exchanges today out of 18.9M BTC that exist. There is about 250k BTC on ETH as WBTC, the largest secondary pool in escrow. Ren has about 18K BTC in escrow. Lightning network is about 3k BTC.
    - micromacrofoot 5y ago
      measuring all bitcoin in existence is a bit misleading because a significant 95% is locked up with 2% of accounts… which is the point of OP
  - maxwell86 5y ago
    My dog is closer to a bank than an exchange is.
    - micromacrofoot 5y ago
      your dog might also be more reliable

EMM_386 5y ago

The silly thing is that crypto is now following the stock market for the most part, at least the big coins like BTC/LTC/Doge/etc are. Market goes down, crypto seems to go down with it. Look at something like 1-month BTC and 1-month APPL or something. It's not supposed to be doing this. I think this is happening because it's become so easy to purchase that people now just have it in their "portfolio", basket of everything, and when they want to sell, they just sell everything, stocks and crypto. They are the same thing to a lot of people. This means it is getting tied into the existing financial system anyway, even without specific "controls" like central banking.

saurik 5y ago
> It's not supposed to be doing this. Is it really not? Both stocks and cryptocurrencies act as inflation hedges against the central bank.
- grey-area 5y ago
  It’s really not. It is highly correlated with high risk assets and growth shares. It is anything but an inflation hedge, which is why it has been plunging as inflation rises and will fall more if interest rates rise. If it were an actual currency things might be different, but instead it’s just another high risk speculative asset.
  - ashwagary 5y ago
    Just because BTC is temporarily correlated with risk assets, that doesnt mean it wont change. Also, it's better to look at charts by starting at the beginnning of this 4 year cycle, dont pick out a bearish 6 month period and falsely claim BTC fails the inflation test. Short termism and Bitcoin's monetary policy are incompatible.
    - zepto 5y ago
      It certainly fails the inflation test without any doubt today. You seem to be saying that it might pass it in the future.

300bps 5y ago

lack of any kind of control Multiple choice question: Which of the following groups have lots of control over BTC? A. BTC Core Developers B. BTC Exchanges C. Credit Card Processors/ACH Entities/Payment apps that allow people to buy BTC from fiat without exchanging physical cash D. BTC Miners E. Any judge in the country that can order you to hand over your BTC just like he/she can order you to dig up the cash he/she suspects you have and hand it over. F. All of the above and many more (It's F)

baby 5y ago
Proof that it’s F is that the protocol is extremely slow to change.
jasode 5y ago
I understand your larger point but to be fair to gp you're responding to, he was scoping the word "control" to Central Bank since he actually wrote: >and by _state control_ I mean something along the lines of a central bank. So central bank control would be something like "expansion of money supply beyond 21 million bitcoins". Therefore, your options (B) Coinbase/Binance (C) Visa/MC/banks and (E) courts -- really have no "control" over that "central bankish" aspect. EDIT reply to: >Central banks [...] don't have complete control about the money supply, because commercial banks also create money via fractional reserves. The Federal Reserve (central bank) in USA is the entity that adjusts the fractional reserve requirement. https://en.wikipedia.org/wiki/Federal_Reserve#Reserve_requirements https://en.wikipedia.org/wiki/Federal_Reserve#Reserve_requir... > The idea that no one can expand the supply of bitcoins beyond 21 million is a nothing but fairy tale. It could theoretically be done but it would require the coordination of the Bitcoin developers + miners + node validators. A crypto-exchange like Coinbase can't do it. As a previous case study, Coinbase was part of the group that aligned with majority miners to change the Bitcoin protocol to increase the block size -- but all that influence and miner support still couldn't get the Bitcoin network to adopt it.
- lottin 5y ago
  This is a misunderstanding of how the money supply works. Central banks have a legal monopoly on the issuance of currency, but they don't have complete control about the money supply, because commercial banks also create money via fractional reserves. Over 80% of the money in circulation is created in this way by commercial banks. And this applies to bitcoin as well. Crypto-exchanges can expand the supply of any crypto-currency by creating deposits that aren't fully backed with reserves. The idea that no one can expand the supply of bitcoins beyond 21 million is a nothing but fairy tale.

mrtksn 5y ago

I’m baffled how people miss this even if it’s the mission statement of Satoshi himself: Bitcoin is a tool to prevent wealth re-distribution. It’s whole idea is to ensure that the accumulated wealth is preserved. In 2008 it was against the government bailing out the failed banks but it’s also against any government interventions, including easing the wealth inequality. In essence, the idea is that if a teenager in 2010 acquired 10,000BTC the society owes him food, shelter and luxury for generations to come. It’s like being a landlord whom passive income guarantees him and his family a good life with no work when people working their arses off to be able to pay the rent.

iszomer 5y ago
> It’s like being a landlord whom passive income guarantees him and his family a good life with no work when people working their arses off to be able to pay the rent. Not necessarily. The state still takes a percentage eg: property tax, maintenance, utilities, safety certifications, etc.
sqrt17 5y ago
The difference being that BTC has no utility that people depend on. They can refuse to buy the BTC from the now-GenZer or even the Winklevoss twins if they'd rather have food or shelter or a chanel bag rather than BTC. The real world phenomenon that this corresponds to is consumer price inflation or asset price inflation (assuming your asset is production capacity and the medium of exchange is BTC) Being a landlord, or being an oil baron in an economy that is dependent on petrol, is different because people actually need those things. So antidemocratic aristocrats who inherited a land with substantial oil reserves can now buy lots of startups via softbank or build artificial cities because our cheapest way to acquire petrol is still to dig it out of the ground in those countries where reserves accumulated in the last millions of years, and pay local rulers for the permission to do it.
- imtringued 5y ago
  If we assume that we should maintain the current scarce currency system, then the only solution would be to have multiple competing scarce currencies. However, Bitcoin is not really competing against anything except maybe gold.

beloch 5y ago

Control by a few anonymous individuals with totally unknown interests is not an improvement on control by state entities whose interests are widely known.

bee_rider 5y ago

Inequality can be measured by non-state entities, and would seem to provide (for example) useful signals to investors about the health of the ecosystem. I think bitcoins/cryptocurrency are largely bullshit and agree that their value proposition mostly comes from the promise to avoid regulation. But we shouldn't pretend that it is impossible for markets to do any sort of introspection without the force of law behind it. And in the case of bitcoin, they do at least know which wallets own which coins, right? Seems easier to track than cash.

imtringued 5y ago

Yeah and in that sense it is basically the same as gold. Gold is a tool to entrench power. Bitcoin is a tool to entrench power. Conventional fiat currency is also a tool designed to entrench power. All of these so called "scarce" currencies achieved exactly what they were designed for. The ideal that Bitcoin lets you escape the current financial dogmas is completely wrong, it's a parody of the existing system. Something like Freicoin would be more appropriate as an alternative, e.g. an "abundant" currency that always makes itself available to anyone who wants to trade.