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Sure, but let's not pretend like bank regulations are perfect. Micro: Right this second, one of my checking accounts at a "reputable" institution (efirstbank.c

Sure, but let's not pretend like bank regulations are perfect. Micro: Right this second, one of my checking accounts at a "reputable" institution (efirstbank.com) is blocked from ACH transfers until April due to hitting an inactivity threshold they refuse to elaborate on. The only way I can move money out is by paying $50 per wire. Macro: the BTC coinbase says it all: "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks"

dralley 5y ago
Bitcoin does not replace banks. People and business still need loans, they still want to invest money and have money invested with them. Crypto doesn't solve that problem. The 2008 collapse had nothing to do with ACH or any of the aspects which crypto has a plausible case for improving.
- BLKNSLVR 5y ago
  My understanding is that (one of) the point(s) of Bitcoin was to de-centralise the control of the currency so that "banks getting a bailout" isn't possible since the currency control of Bitcoin doesn't allow printing it out of thin air for handing out to the businesses that caused the crash that seemingly necessitated the bailout. Secondly to that, I find it amusing that the cause of the GFC (amongst numerous other large-scale issues) is both poor regulation and ineffective enforcement of an industry that's over a century old. Proving, basically, that the regulation of cryptocurrency is a pure talk-fest (or that any US regulation is a pure talk-fest). It will result in the honest folks doing the right thing and getting screwed in the process whilst the dishonest still do the bad things because the US' will to enforce regulation is weak.
  - ohgodplsno 5y ago
    A few years later, the TheDAO hack happens, and Vitalik and friends pretty much force a fork on the network by spamming FUD and threatening to stop the entire thing because they're losing too much money and they're too big to fail. Totally different from banks: it's no longer the government deciding to bail them out, it's straight up the bank printing the currency telling people to bail them out or their currency becomes worthless.
    - BLKNSLVR 5y ago
      I wasn't paying a lot of attention back then, but from what I've read about it, it was far from the worst decision in the world despite the fact it went against the most basic ideology. I give it a bit of a free pass because it was a new thing built on top of a new thing, so somewhat of a beta test, which failed, so roll back to a working state. Not sure what would happen now, although there are regular hacks that no longer see rollbacks. Also, Ethereum Classic still exists, so that path is still available to those who want to follow it.
    - mateuszf 5y ago
      That's Ethereum though, not Bitcoin.
  - jollybean 5y ago
    " so that "banks getting a bailout" isn't possible since the currency control of Bitcoin doesn't allow printing it out of thin air for" ? What part of 'the economy would crash and burn' do people not understand? The banks would have gone down like dominoes and taken the entire system with it. This isn't 'fear mongering' it's basically just math, you can see how the system is connected and what will happen. That's what happens when systems are tightly intertwined. We could entirely firewall them, but then they wouldn't be remotely as efficient. The fallacy of 'Hard Currency' is that people think we can avoid these problems with some extant construct, like 'Gold' or 'Digital Proof' but that doesn't solve the problem at all. Economies are integrated systems that have to be regulated as best we can there is just no way around it. 'Hard Currency' is an 'instinct' that develops into an ideology that just doesn't hold up. Far from 'weakly enforced regulations' most Western nations have very well and strongly enforced regulatory regimes. There are rules upon rules about what is allowed and what is not. Securities Regulation are maybe a bit iffy, particularly insider trading, but that's only one thing. The only way to avoid the problems we saw in 2008 would be to have more effective regulation of the parts of that system that failed, crypto won't save us there. Finally, the banks were bailed out mostly with loans which they paid back, not free money. If there was a big funny business bailout, it was the mortgages that the Fed accepted as collateral at face value, which was more or less a bailout of homeowners, related to the fact the issue was with homes, not so much currency.
    - BLKNSLVR 5y ago
      > The banks would have gone down like dominoes and taken the entire system with it. This isn't 'fear mongering' it's basically just math, you can see how the system is connected and what will happen. And the fact that the Fed could just QE a bailout is why there's no will to properly regulate or enforce. It's a double edged sword. I would have liked to see what would happen in a pandemic if Bitcoin were the world's reserve currency; if no QE were possible to help the suddenly unemployed etc. If / when Bitcoin fails in such a situation, we could see an increase in trust for fiat currencies and government monetary policy. It's a purely hypothetical situation though.
      - jollybean 5y ago
rtpg 5y ago
"Banks get bailed out" seems to be a feature for stability of systems (counterargument: "Let all the banks fail" would have been helpful for what part of society?) There is of course the very legitimate argument of bailing out homeowners (banks still get their money and people get to actually be in houses), but letting the pieces fall where they may is extreme orthodoxy when the real world is at stake. And of course the crypto ecosystem has shown this pragmatism so many times now when basically forking off to other things to reverse unwanted transactions.
- rawtxapp 5y ago
  Yeah, let's privatize the gains and socialize the losses because the banks are too big to fail. What a great system! But hey, at least it's stable.
  - rtpg 5y ago
    Didn't say we should privatize the gains. I just don't think that it's useful to tear down a bunch of infrastructure on principle. I would not have minded just nationalizing as much as would have been needed either. And of course bailing out a bunch of homeowners would be extremely ideal. Gov't intervention when systems are falling apart are not a bad thing (well, at least when they actually do helpful things).
  - ABeeSea 5y ago
    The bank bailouts were ultimately profitable for the US government. Banks paid back the loans with interest. https://money.cnn.com/2014/12/19/news/companies/government-bailouts-end/ https://money.cnn.com/2014/12/19/news/companies/government-b...
    - ilammy 5y ago
      15.3B in profit on 426B investment is 3.6% yield, and that's over 6 years. US inflation alone between 2008 and 2014 was about 10%.
      - 5y ago
toomuchtodo 5y ago
> Micro: Right this second, one of my checking accounts at a "reputable" institution (efirstbank.com) is blocked from ACH transfers until April due to hitting an inactivity threshold they refuse to elaborate on. The only way I can move money out is by paying $50 per wire. https://www.federalreserve.gov/faqs/credit_12666.htm https://www.federalreserve.gov/faqs/credit_12666.htm https://www.consumerfinance.gov/complaint/ https://www.consumerfinance.gov/complaint/ https://www.helpwithmybank.gov/file-a-complaint/index-file-a-complaint.html https://www.helpwithmybank.gov/file-a-complaint/index-file-a... You have some recourse with regulators when dealing with fiat banking systems. You have zero recourse when dealing with crypto losses (unless you’ve lost enough that a criminal prosecutor makes it their problem and you can convince them it’s worth their time).
- beebmam 5y ago
  Very good point. Democracy can govern banks. Democracy cannot govern cryptocurrencies. That is both why it is hated and loved by different groups of people.
kritiko 5y ago
The ACH thing sounds annoying, but your money is not at risk. I think the more concerning thing I have seen is banks deciding that they no longer want to do business with you with no appeals process or recourse as to why your account was flagged.
ABeeSea 5y ago
TARP was profitable for the US government. The “bailout” loans were paid back with interest.
weq 5y ago
My GF attempted to transfer money to a CEX that was verified and her money was frozen abritartly for 3months by her "bank" until they "investigated it thouroughly". Banks are nice until they arnt. Crypto is a wild west but its the future of investments. The older traders will die out, those who had the money and the advantage will be replaced like the older bootleggers turned into multi-nationals.
- DonHopkins 5y ago
  Somehow I suspect there are details to this convenient anecdote that you're not telling us...
ajross 5y ago
> Right this second, one of my checking accounts at a "reputable" institution (efirstbank.com) is blocked from ACH transfers until April due to hitting an inactivity threshold they refuse to elaborate on. The only way I can move money out is by paying $50 per wire. You can't... write a check? It's right there in the name.
pjc50 5y ago
Just because the US has terrible consumer protection doesn't mean you need to build a worse system with no consumer protection at all.
JoachimS 5y ago
"Sure, but let's not pretend like bank regulations are perfect." Nobody claimed that. And whataboutism is not a solution, right?

dralley 5y ago

Bitcoin does not replace banks. People and business still need loans, they still want to invest money and have money invested with them. Crypto doesn't solve that problem. The 2008 collapse had nothing to do with ACH or any of the aspects which crypto has a plausible case for improving.

BLKNSLVR 5y ago
My understanding is that (one of) the point(s) of Bitcoin was to de-centralise the control of the currency so that "banks getting a bailout" isn't possible since the currency control of Bitcoin doesn't allow printing it out of thin air for handing out to the businesses that caused the crash that seemingly necessitated the bailout. Secondly to that, I find it amusing that the cause of the GFC (amongst numerous other large-scale issues) is both poor regulation and ineffective enforcement of an industry that's over a century old. Proving, basically, that the regulation of cryptocurrency is a pure talk-fest (or that any US regulation is a pure talk-fest). It will result in the honest folks doing the right thing and getting screwed in the process whilst the dishonest still do the bad things because the US' will to enforce regulation is weak.
- ohgodplsno 5y ago
  A few years later, the TheDAO hack happens, and Vitalik and friends pretty much force a fork on the network by spamming FUD and threatening to stop the entire thing because they're losing too much money and they're too big to fail. Totally different from banks: it's no longer the government deciding to bail them out, it's straight up the bank printing the currency telling people to bail them out or their currency becomes worthless.
  - BLKNSLVR 5y ago
    I wasn't paying a lot of attention back then, but from what I've read about it, it was far from the worst decision in the world despite the fact it went against the most basic ideology. I give it a bit of a free pass because it was a new thing built on top of a new thing, so somewhat of a beta test, which failed, so roll back to a working state. Not sure what would happen now, although there are regular hacks that no longer see rollbacks. Also, Ethereum Classic still exists, so that path is still available to those who want to follow it.
  - mateuszf 5y ago
    That's Ethereum though, not Bitcoin.
- jollybean 5y ago
  " so that "banks getting a bailout" isn't possible since the currency control of Bitcoin doesn't allow printing it out of thin air for" ? What part of 'the economy would crash and burn' do people not understand? The banks would have gone down like dominoes and taken the entire system with it. This isn't 'fear mongering' it's basically just math, you can see how the system is connected and what will happen. That's what happens when systems are tightly intertwined. We could entirely firewall them, but then they wouldn't be remotely as efficient. The fallacy of 'Hard Currency' is that people think we can avoid these problems with some extant construct, like 'Gold' or 'Digital Proof' but that doesn't solve the problem at all. Economies are integrated systems that have to be regulated as best we can there is just no way around it. 'Hard Currency' is an 'instinct' that develops into an ideology that just doesn't hold up. Far from 'weakly enforced regulations' most Western nations have very well and strongly enforced regulatory regimes. There are rules upon rules about what is allowed and what is not. Securities Regulation are maybe a bit iffy, particularly insider trading, but that's only one thing. The only way to avoid the problems we saw in 2008 would be to have more effective regulation of the parts of that system that failed, crypto won't save us there. Finally, the banks were bailed out mostly with loans which they paid back, not free money. If there was a big funny business bailout, it was the mortgages that the Fed accepted as collateral at face value, which was more or less a bailout of homeowners, related to the fact the issue was with homes, not so much currency.
  - BLKNSLVR 5y ago
    > The banks would have gone down like dominoes and taken the entire system with it. This isn't 'fear mongering' it's basically just math, you can see how the system is connected and what will happen. And the fact that the Fed could just QE a bailout is why there's no will to properly regulate or enforce. It's a double edged sword. I would have liked to see what would happen in a pandemic if Bitcoin were the world's reserve currency; if no QE were possible to help the suddenly unemployed etc. If / when Bitcoin fails in such a situation, we could see an increase in trust for fiat currencies and government monetary policy. It's a purely hypothetical situation though.
    - jollybean 5y ago

rtpg 5y ago

"Banks get bailed out" seems to be a feature for stability of systems (counterargument: "Let all the banks fail" would have been helpful for what part of society?) There is of course the very legitimate argument of bailing out homeowners (banks still get their money and people get to actually be in houses), but letting the pieces fall where they may is extreme orthodoxy when the real world is at stake. And of course the crypto ecosystem has shown this pragmatism so many times now when basically forking off to other things to reverse unwanted transactions.

rawtxapp 5y ago
Yeah, let's privatize the gains and socialize the losses because the banks are too big to fail. What a great system! But hey, at least it's stable.
- rtpg 5y ago
  Didn't say we should privatize the gains. I just don't think that it's useful to tear down a bunch of infrastructure on principle. I would not have minded just nationalizing as much as would have been needed either. And of course bailing out a bunch of homeowners would be extremely ideal. Gov't intervention when systems are falling apart are not a bad thing (well, at least when they actually do helpful things).
- ABeeSea 5y ago
  The bank bailouts were ultimately profitable for the US government. Banks paid back the loans with interest. https://money.cnn.com/2014/12/19/news/companies/government-bailouts-end/ https://money.cnn.com/2014/12/19/news/companies/government-b...
  - ilammy 5y ago
    15.3B in profit on 426B investment is 3.6% yield, and that's over 6 years. US inflation alone between 2008 and 2014 was about 10%.
    - 5y ago

toomuchtodo 5y ago

> Micro: Right this second, one of my checking accounts at a "reputable" institution (efirstbank.com) is blocked from ACH transfers until April due to hitting an inactivity threshold they refuse to elaborate on. The only way I can move money out is by paying $50 per wire. https://www.federalreserve.gov/faqs/credit_12666.htm https://www.federalreserve.gov/faqs/credit_12666.htm https://www.consumerfinance.gov/complaint/ https://www.consumerfinance.gov/complaint/ https://www.helpwithmybank.gov/file-a-complaint/index-file-a-complaint.html https://www.helpwithmybank.gov/file-a-complaint/index-file-a... You have some recourse with regulators when dealing with fiat banking systems. You have zero recourse when dealing with crypto losses (unless you’ve lost enough that a criminal prosecutor makes it their problem and you can convince them it’s worth their time).

beebmam 5y ago
Very good point. Democracy can govern banks. Democracy cannot govern cryptocurrencies. That is both why it is hated and loved by different groups of people.

kritiko 5y ago

The ACH thing sounds annoying, but your money is not at risk. I think the more concerning thing I have seen is banks deciding that they no longer want to do business with you with no appeals process or recourse as to why your account was flagged.

ABeeSea 5y ago

TARP was profitable for the US government. The “bailout” loans were paid back with interest.

weq 5y ago

My GF attempted to transfer money to a CEX that was verified and her money was frozen abritartly for 3months by her "bank" until they "investigated it thouroughly". Banks are nice until they arnt. Crypto is a wild west but its the future of investments. The older traders will die out, those who had the money and the advantage will be replaced like the older bootleggers turned into multi-nationals.

DonHopkins 5y ago
Somehow I suspect there are details to this convenient anecdote that you're not telling us...

ajross 5y ago

> Right this second, one of my checking accounts at a "reputable" institution (efirstbank.com) is blocked from ACH transfers until April due to hitting an inactivity threshold they refuse to elaborate on. The only way I can move money out is by paying $50 per wire. You can't... write a check? It's right there in the name.

pjc50 5y ago

Just because the US has terrible consumer protection doesn't mean you need to build a worse system with no consumer protection at all.

JoachimS 5y ago

"Sure, but let's not pretend like bank regulations are perfect." Nobody claimed that. And whataboutism is not a solution, right?