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> Thus, increased acceptance of cryptocurrencies would result in effective ‘Dollarization’ of our economy6. Dollarization, it is well understood, would undermin

> Thus, increased acceptance of cryptocurrencies would result in effective ‘Dollarization’ of our economy6. Dollarization, it is well understood, would undermine the ability of authorities to control money supply or interest rates, as monetary policy would not have any impact on the non-Rupee currencies or payment instruments. When that happens, India loses not just its currency, a defining feature of its sovereignty, but its policy control of the economy. With loss of traction for monetary policy, the ability to control inflation would be materially weakened. If I transacted in, say, cans of beans, would that also undermine sovereignty and control of the economy? Sounds to me that the mentioned sovereignty and control are very fragile. Sovereignty should come through consent of citizens and voluntary participation, not tyranny. And since the Rupee devalued 2.4 times against the USD in the past 27 years, I argue that such inflation control was abused, punishing savers and encouraging debt, essentially translating to financial repression.

horsestaple 5y ago
Yes, if you convinced a lot of people to transact in cans of beans, you would be undermining the control of the government. Just look at countries that don't have a (viable) currency. They are using dollars or euros and are subject to a foreign powers monetary policy. Also no country defines sovereignty through voluntary consent. Laws applies to you whether you agree or not.
- danuker 5y ago
  Democracy, as opposed to oligarchy, is where the people are ultimately sovereign. Sure, laws apply to the ones disagreeing, but in theory, the government serves the people, not rules it. Central banks however, have a large amount of control over everyone's financial life, yet the signal from voting is only very dimly forwarded to this institution, and there are limited checks and balances governing it.
simion314 5y ago
>If I transacted in, say, cans of beans, would that also undermine sovereignty and control of the economy? From what I seen in my country's past the government will always get the blame and is asked to pay when people get scammed, then the goverment adds new laws to prevent future scams. Say you borrow some money to buy a house and you use a foreign currency, and a year later that currency doubles, you get screwed. This actually happened and people asked the government to fix it. Sorry for poor details I don't like financial stuff so avoid it if possible https://www.businessinsider.com/the-swiss-franc-surge-crushed-many-europeans-financially-2015-2 https://www.businessinsider.com/the-swiss-franc-surge-crushe... https://en.wikipedia.org/wiki/Caritas_(Ponzi_scheme) https://en.wikipedia.org/wiki/Caritas_(Ponzi_scheme) It's obvious that giving the power to crash your economy to a foreign group is losing sovereignty, what happens if some hackers or government crashes bitcoin? I suspect the government will be blamed as usual because it did not see it coming and prevent it. As long as the government is not imposed by a foreign nation or some Illuminati then I would say the majority of the population should also take all the criticism not only the institution. IMO if the population wants the government to protect them from scams and foreign financial group playing with their money then it is what it is, a weakness of democracy, where majority rules.
meheleventyone 5y ago
You’ll probably find transacting using goods instead of money is already regulated.

horsestaple 5y ago

Yes, if you convinced a lot of people to transact in cans of beans, you would be undermining the control of the government. Just look at countries that don't have a (viable) currency. They are using dollars or euros and are subject to a foreign powers monetary policy. Also no country defines sovereignty through voluntary consent. Laws applies to you whether you agree or not.

danuker 5y ago
Democracy, as opposed to oligarchy, is where the people are ultimately sovereign. Sure, laws apply to the ones disagreeing, but in theory, the government serves the people, not rules it. Central banks however, have a large amount of control over everyone's financial life, yet the signal from voting is only very dimly forwarded to this institution, and there are limited checks and balances governing it.

simion314 5y ago

>If I transacted in, say, cans of beans, would that also undermine sovereignty and control of the economy? From what I seen in my country's past the government will always get the blame and is asked to pay when people get scammed, then the goverment adds new laws to prevent future scams. Say you borrow some money to buy a house and you use a foreign currency, and a year later that currency doubles, you get screwed. This actually happened and people asked the government to fix it. Sorry for poor details I don't like financial stuff so avoid it if possible https://www.businessinsider.com/the-swiss-franc-surge-crushed-many-europeans-financially-2015-2 https://www.businessinsider.com/the-swiss-franc-surge-crushe... https://en.wikipedia.org/wiki/Caritas_(Ponzi_scheme) https://en.wikipedia.org/wiki/Caritas_(Ponzi_scheme) It's obvious that giving the power to crash your economy to a foreign group is losing sovereignty, what happens if some hackers or government crashes bitcoin? I suspect the government will be blamed as usual because it did not see it coming and prevent it. As long as the government is not imposed by a foreign nation or some Illuminati then I would say the majority of the population should also take all the criticism not only the institution. IMO if the population wants the government to protect them from scams and foreign financial group playing with their money then it is what it is, a weakness of democracy, where majority rules.

meheleventyone 5y ago

You’ll probably find transacting using goods instead of money is already regulated.