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A legitimate use of crypto "currencies" is defense against hyperinflation. Ask anyone in Venezuela.

by danuker 5y ago

knorker 5y ago
So Venezuela is all fine now, thanks to blockchain?
- betwixthewires 5y ago
  No, but people there have options thanks to it.
curtisf 5y ago
You can't spend cryptocurrency at the grocery store. So your "money" can only at best be _backed_ by cryptocurrency. But if all you want is your money to be backed by something that intrinsically retains value, there are many standard choices. Like _foreign currency_. Or something more involved, like stocks and bonds and commodities contracts. Or you could just plain use precious metals. Cryptocurrency doesn't uniquely solve the problem of inflation, but it does introduce a lot of others. (Including the risk that a country's entire Treasury gets drained because an office worker plugs a USB stick they found in the parking lot into the wrong computer)
- betwixthewires 5y ago
  In Venezuela and Argentina you can absolutely buy goods at the store with cryptocurrency, if you whisper low enough to the owner. In El Salvador the government mandates it be an option. Money is money where it's accepted, everywhere else it's not. That's not really a point at all.
- danuker 5y ago
  > _backed_ by cryptocurrency. Governments have fallen for the siren call of inflation ever since Nixon. They won't give it up and adopt any standard, gold or otherwise, because it would imply they have to be accountable for finances. This is why private individuals have to use more creative ways of storing their value.
AlexandrB 5y ago
This is true about any asset that's not undergoing hyperinflation itself including stocks, bonds, commodities, real-estate, and foreign currencies. What's special about cryptocurrencies in this regard?
- floren 5y ago
  The answer is usually "well, I happen to own cryptocurrencies, but not those other things you're suggesting"
- masegod 5y ago
  the supply of bitcoin is mathematically guaranteed, also much harder to steal
  - bradjohnson 5y ago
    > much harder to steal This is objectively false given that the article is about how easy it is to scam people out of their bitcoins.
- danuker 5y ago
  The ease of sending it. Stocks and bonds are not bearer assets, so you have to sell them before spending them. Commodities are inconvenient to carry (though in some cases maybe more convenient than wheelbarrowing cash). Real-estate is much less liquid, you can't sell or spend 0.01% of an apartment.
bradjohnson 5y ago
What is the advantage of this over investing in GME? Both backed by strength of a meme, both highly speculative, except at least converting GME to actual money doesn't require you to burn energy equivalent to the average US household's monthly consumption.

A legitimate use of crypto "currencies" is defense against hyperinflation. Ask anyone in Venezuela.

knorker 5y ago

So Venezuela is all fine now, thanks to blockchain?

betwixthewires 5y ago
No, but people there have options thanks to it.

curtisf 5y ago

You can't spend cryptocurrency at the grocery store. So your "money" can only at best be _backed_ by cryptocurrency. But if all you want is your money to be backed by something that intrinsically retains value, there are many standard choices. Like _foreign currency_. Or something more involved, like stocks and bonds and commodities contracts. Or you could just plain use precious metals. Cryptocurrency doesn't uniquely solve the problem of inflation, but it does introduce a lot of others. (Including the risk that a country's entire Treasury gets drained because an office worker plugs a USB stick they found in the parking lot into the wrong computer)

betwixthewires 5y ago
In Venezuela and Argentina you can absolutely buy goods at the store with cryptocurrency, if you whisper low enough to the owner. In El Salvador the government mandates it be an option. Money is money where it's accepted, everywhere else it's not. That's not really a point at all.
danuker 5y ago
> _backed_ by cryptocurrency. Governments have fallen for the siren call of inflation ever since Nixon. They won't give it up and adopt any standard, gold or otherwise, because it would imply they have to be accountable for finances. This is why private individuals have to use more creative ways of storing their value.

AlexandrB 5y ago

This is true about any asset that's not undergoing hyperinflation itself including stocks, bonds, commodities, real-estate, and foreign currencies. What's special about cryptocurrencies in this regard?

floren 5y ago
The answer is usually "well, I happen to own cryptocurrencies, but not those other things you're suggesting"
masegod 5y ago
the supply of bitcoin is mathematically guaranteed, also much harder to steal
- bradjohnson 5y ago
  > much harder to steal This is objectively false given that the article is about how easy it is to scam people out of their bitcoins.
danuker 5y ago
The ease of sending it. Stocks and bonds are not bearer assets, so you have to sell them before spending them. Commodities are inconvenient to carry (though in some cases maybe more convenient than wheelbarrowing cash). Real-estate is much less liquid, you can't sell or spend 0.01% of an apartment.

bradjohnson 5y ago

What is the advantage of this over investing in GME? Both backed by strength of a meme, both highly speculative, except at least converting GME to actual money doesn't require you to burn energy equivalent to the average US household's monthly consumption.