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I’m blown away by how anti-crypto this discussion is. I hadn’t realized how negative the prevailing sentiment is on Hacker News. One argument seems to be that

by nrzd 5y ago

I’m blown away by how anti-crypto this discussion is. I hadn’t realized how negative the prevailing sentiment is on Hacker News. One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? Another argument is that crypto enables ransomware attacks. This to me sounds akin to saying “encryption enables child exploitation”. I.e. it focuses on one abhorrent element of society that would take place no matter what and blames its existence on a system which has great potential for good, a kind of propagandist thinking. Another argument is that Banks will be hurt by crypto. Good! Any epochal transition can be tumultuous, but in my view disrupting the basis of the greatest wealth inequality known to history is a good start. We’re not talking about “banks” that operate on a local or regional basis — these can adapt to using new technology and serve the same people — we’re talking about multinational Banks which went beyond skimming the cream long ago and don’t aparently have people’s best interests in mind.

afpx 5y ago
Bitcoin was some neat tech. But, in case you haven’t noticed it’s been taken over by finance bros. Now, it’s just a scam to prey on the poor and ignorant.
- danuker 5y ago
  How is it a scam? Does it not still offer the same tech? In fact, with Lightning, even more advanced tech.
- johndevor 5y ago
  Wait until you hear about fiat currencies.
  - l-lousy 5y ago
    I think that’s the argument, why move to a whole new currency if it’s more of the same problems with fewer safeguards for the non technical and no way to get lost items back?
    - aaaaaaaaata 5y ago
      Why would the poor have wanted to switch to the Internet? After all, it required expensive custom hardware, and know-how. What changed? Have you considered it's just really early days?
      - floodyberry- 5y ago
        "really early days" is an argument that a lot more work is needed, not that everyone should go all in knowing there is going to be a lot of collateral damage along the way even _if_ it works out.
      - Hoasi 5y ago
        > Have you considered it's just really early days? How many years do early days last?
        aaaaaaaaata 5y ago
        Well, once again, using the Internet as a very easy to reach example....decades?
      - acdha 5y ago
        > Why would the poor have wanted to switch to the Internet? Look at the history and this is easily answered: it let them do things better/easier/cheaper. That could be shopping, accessing government services, dealing with companies, finding a job, seeking educational material, entertainment, dating, connecting with friends and family (email was a pretty sweet alternative to long distance phone calls), etc. The internet picked up sharply as computers came down in price and people tried even cheaper options like WebTV because there was so much demand, and that started happening very quickly. In contrast, cryptocurrency had much lower barriers to entry but despite having at least twice as many years by that point it has very little non-speculative usage because it doesn’t do anything most people care about. Even being a cheaper PayPal/Venmo would be an improvement.
  - lr4444lr 5y ago
    You can pay your taxes, fines, and court ordered debts with fiat currency. It's arguably THE MOST stable thing in a functioning society above pure barter.
    - danuker 5y ago
      Try saving for retirement. At 2% inflation (the target rate), after 20 years you'd lose 1 - (.98 ^ 20) = 33.2% of the purchasing power of your savings. But right now, inflation is 7.5% year-over-year. And that's the official measure, which uses "owners' equivalent rent" based on a survey, instead of actual rent prices. In the past 20 years (Jan 2002 - Jan 2022), the CPI went from 177.7 to 281.933, or a 58.6% increase. This means a 2.3% average inflation rate. https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi https://www.investopedia.com/terms/o/owners-equivalent-rent.asp https://www.investopedia.com/terms/o/owners-equivalent-rent....
      - Spoom 5y ago
        This implies that your retirement savings are in cash, which is inaccurate for most folks. And certainly, I'd rather have it invested in the stock market than the wild fluctuations of the crypto market, especially with its uncertain withdrawal ability and complete inability to recover if someone steals it (which is, again, typically much easier with crypto than a brokerage).
        danuker 5y ago
        The previous comment said cash is stable. I was illustrating that it is stably losing value.
        kravens_last 5y ago
        Would you rather stably losing purchase power at a predictable pace over time (fiat) or exponentially unstable purchase power in perpetuity (bitcoin)?
      - 5y ago
  - UncleMeat 5y ago
    New things aren't always better. Yes, existing financial systems are terrible. They are rampant with abuse, manipulation, and people converting human behavior into abstract objects that they can gamble on so that they can extract wealth without providing value and they do this to the point that they introduce systemic risk to our entire society. Cryptocurrency is this times 1000. It is the financialization of everything. Instead of mortgages being packaged up into bonds and then derivatives of those bonds, everything gets packaged up into financial instruments and then derivatives of those instruments. Something like ETH makes it very easy to write programs that move tokens that are worth dollars based on inputs taken from the ledger itself. That inevitably encourages a sort of hyper-financial system. That's worse.
- lawn 5y ago
  Yes, most of the loud discussion is by crypto bros that want to get rich and don't care and don't understand the technology. I understand that the negative sentiment is a counter-reaction to the crypto bros, but a little more nuance would be welcome.
thrwyoilarticle 5y ago
>What about the stock market? What about any kind of investment? You mean the kind that pay dividends?
- PretzelPirate 5y ago
  What percentage of stocks pay dividends?
  - mlac 5y ago
    I don’t have a percentage, but here are 25 to start with: https://www.nerdwallet.com/article/investing/how-to-invest-dividend-stocks https://www.nerdwallet.com/article/investing/how-to-invest-d...
- danuker 5y ago
  There are companies paying dividends, and companies reinvesting profit. What difference does it make?
- pjc50 5y ago
  Before a stupid argument breaks out, everyone please note that a stock buyback is basically equivalent to a dividend with a different tax treatment; both are returning money to investors. It's also theoretically possible for some of the crypto-token-organisation things to pay dividends, but it's far more common for them to simply take the money and run. Because a token is not a legal framework like a company is.
- aaaaaaaaata 5y ago
  You mean payments/yield from staking?
joshjdr 5y ago
“Purely speculative” is what makes it more akin to gambling than investing in income generating assets.
- PretzelPirate 5y ago
  Crypto can be an income-generating asset just like any stock that pays dividends. You can use lending protocols or act as a liquidity provider and, in many cases, have your income earned in a stable coin (such as USDC).
  - pjc50 5y ago
    Hilariously, crypto has reinvented fractional reserve banking. "Staking" is just traditional fixed-duration lending, but with some weird caveats and liquidation rules borrowed from margin trading that you need to read carefully.
    - cuteboy19 5y ago
      Most importantly, it has no real guarantee. There is no reason why our beloved Tether inc can't just vanish from its Cayman Islands headquarters one day
dangoor 5y ago
> One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? I recommend not using the "what about the stock market?" tactic to defend cryptocurrencies. Crypto is more speculative than the stock market because companies have physical assets, ongoing revenue and profits, dividends that they pay out to their shareholders.
- mantenpanther 5y ago
  Bitcoin is anchored in physics and math. And used by millions without western privileges.
  - mlac 5y ago
    Highway infrastructure is also anchored in physics and math. It doesn’t mean we should treat highways like a currency that should be purchased and traded. Starting a business is open for millions “without western privileges” - and stock is owning a business. Starting a profitable business that adds value (people are willing to pay you for a service) is a lot more useful to society than spinning up another coin that does nothing.
    - throwthere 5y ago
      > Highway infrastructure is also anchored in physics and math. It doesn’t mean we should treat highways like a currency that should be purchased and traded. Clearly, the world needs highway-based NFTs. Knowing that their ephemeral infrastructure is represented on the blockchain, something that is permanent, will lead to engineers building safer bridges. It will encourage the development of new fields of engineering, perhaps subfields related to structures and others related to materials. Contrast that to the stock market, where companies sell ownership shares in their businesses tracked in ledgers maintained by western corporations. And some of the underlying businesses have no plans to ever to distribute cash to their stock owners-- look at Berkshire Hathaway! Look at Google! People buy and sell those shares only because the next person will buy them for more. It's a classic speculative investment, not like crypto which is backed by the full faith and power of NVIDIA. /s. Or is it?
chrisseaton 5y ago
> If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? Presumably the people you’re talking about don’t think that, so no it wouldn’t be rational for them.
concinds 5y ago
Most of the anti-crypto critiques in Silicon Valley bring up these exact arguments: it's speculative, and it enables scams. At its root, it's a hatred of the "get rich quick" aspects of crypto. It evokes the same contempt that old-wealth (people with butlers) have for new-wealth (people with Lamborghinis): that they're childish, didn't earn their privileges, and need to be reined in. It's class signalling. Thankfully crypto isn't a democracy. Money market funds, banks, stock exchanges, and every other financial institution can be frozen instantaneously by the U.S. President to "prevent another financial collapse". Those who are OK with that much power being concentrated in one person, can continue avoiding crypto. But no amount of public outcry can ban, shut down or criminalize crypto, same as you can't ban IMAP or AES.
- bluGill 5y ago
  The government can criminalize crypto. Investigation wouldn't be easy, but the FBI and other equivalents (depending on your country) are very good at investigating hard to solve crimes, and if given the budget can track you down in various ways. (tax fraud is often a big one - even if they can't prove you are in crypto they can prove you didn't pay tax on something)
- pjc50 5y ago
  > But no amount of public outcry can ban, shut down or criminalize crypto, same as you can't ban IMAP or AES. This is a terrible example as the US government really did ban DES for a while - at least for "export", which includes publishing on the internet. People who say "the government can't ban X" are really badly underestimating how far governments are willing to go if you really do start disrupting the state.
  - concinds 5y ago
    Yes, governments can try, but there will always be ways to fight it; including using sneakernet to exchange hardware wallets, instead of traceable on-blockchain transactions. Crypto is as impossible to ban as the internet at this point.
    - 5y ago
AlexandrB 5y ago
> One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? Most other assets represent ownership of... something. A company, a commodity, property. Cryptocurrency is closest to either a fiat currency without the government backing that typically tries to stabilize those. Or to more exotic and abstract financial instruments like credit default swaps or shorts. Basically what's missing is the ability to even guess at the "true" value of cryptocurrency. There's no P/E ratios to consider because the only thing Crypto "produces" is Crypto transactions. It's also impossible to even guess at a floor or ceiling for the price of a cryptocurrency. The only thing that determines their price is human sentiment - a very fickle input. Because of this, it's likely that cryptocurrency is vulnerable to market manipulation. Both through large transactions and through marketing. See also: the ample evidence of wash trading in the NFT space. In these kinds of situations my feeling is that if I'm not the one doing the manipulating then I'm the sucker on the other end.
- aqme28 5y ago
  > Basically what's missing is the ability to even guess at the "true" value of cryptocurrency. There's no P/E ratios to consider because the only thing Crypto "produces" is Crypto transactions. It's also impossible to even guess at a floor or ceiling for the price of a cryptocurrency. The only thing that determines their price is human sentiment - a very fickle input. Interestingly, this isn't really true anymore. Most of the newer defi currencies represent a portion of ownership in some protocol that is actually returning profits. E.g. Maker is a lending platform for DAI. You can borrow DAI by depositing other currencies as collateral. The interest you pay to borrow is then converted by Maker into a sort of "stock buyback" against its Maker token. The Maker token has a P/E ratio, as do many other coins. https://www.tokenterminal.com/ https://www.tokenterminal.com/ To your point though, the P/E ratio for most of these is denominated in other cryptocurrencies, not in USD.
  - meragrin_ 5y ago
    > ownership in some protocol But what is the value of the protocol? > actually returning profits Are there actually profits if the protocol is worthless?
bluGill 5y ago
There are different types of speculative investments. Stocks are backed by the company they are behind, when the company goes out of business the stocks stop trading. When you own stocks you vote on company leadership (or at least should). When the company makes money they pay you cash as a dividend (for tax reasons this most often comes in the form of a stock buy back making your stock more valuable. As such stock speculation on the company not stocks in general. Historically money was backed by gold, and supply and demand of gold is what governed the price. Today cash is not, and it is only backed by the government saying you have to use it. As such cash is more speculative than stocks, but the government forcing you to use it means it has some power behind it. Bitcoin is backed by some governments, so bitcoin is speculation on those governments (this is new in the past few years and makes bitcoin somewhat less speculative than other crypto) I don't see the point of crypto in the end. Almost everything it can do is better done by a secure central database, and the rest is a niche that can be handled by physical cash, or a contract (ie check) that is reconciled with the database later. Sure you could use cyrpto, but the energy costs are so much larger that I don't think we as a society can afford to use it.
- logifail 5y ago
  > When the company makes money they pay you cash as a dividend (for tax reasons this most often comes in the form of a stock buy back [...]) Often? "Nearly 75% of the stocks in the S&P 500 pay a dividend, and the dividend for most of them exceeds the yield on U.S. 10-year Treasury bonds (currently around 2%)"[0] [0] https://cabotwealth.com/daily/dividend-stocks/highest-paying-dividend-stocks-sp-500/ https://cabotwealth.com/daily/dividend-stocks/highest-paying...
  - bluGill 5y ago
    Even companies that pay a dividend buy back stocks.
bombcar 5y ago
Even assuming that crypto currency does provide value and wins out in the end - why would it be any of the existing ones as opposed to a new one started by the right players?
unstatusthequo 5y ago
Agree with you on all of that. The general HN sentiment towards cryptocurrency is so acutely negative. I generally don’t even bother clicking links related to it because of this issue. Its just asking for whiny diatribes about how crypto sucks and will ruin everything. It’s ironic to me how freedom loving HN can be, until it is finance related and threatening governments and banks but empowering the masses. Seems bizarre to me. I’ll exit before the “uses too much energy” dissertations enter. I bet your stacks of bare metal severs and electric cars and hairdryers and ovens and water furnaces and electric heaters and gaming machines and four monitor dev setups are super green. Could crypto be better at using less energy? Probably. Could those other things? Yep. Is progress on efficiency being made? Well, yes, at least crypto is trying to do so with PoS etc. can’t say the same for your heavy old appliances.
- spaceisballer 5y ago
  So all the things you have listed consuming energy have uses. They are doing something. Can they be more efficient, sure. What exactly is crypto doing? What is it solving? The crypto industry keeps growing and consuming video cards, processors and energy. To do what? So if it’s a currency it’s not even close to the efficiency and speed of the current financial system. Ease of use too, not even close. People are making money though, so I guess we don’t question it?
Blackstone4 5y ago
>One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? I feel like it is a black and white and naive view to categorize every financial instrument as purely speculative. They exist along a spectrum ranging from on one hand, sound investments (i.e. US treasuries), all the way to more speculative plays like sports betting. Where an asset sits on the spectrum is a subjective to the eye of the beholder but concensus among investors at this time would probably place US treasuries, blue chip corporate bonds, US stocks in the sound investment half and crypto in the more speculative half. In part because new technology which makes some wary and in part because crypto is a form of currency where most participants appear to be 'investing' on the basis they can sell it to someone else at a higher price. Which sounds fine but normally stocks or US treasuries are underpinned by interest payments, dividends or promise of future dividends through earnings growth whereas most crypto does not have an of these characteristics. I am blown away by the number of people claiming to be knowledgeable crypto investors who are dismissive of other investment types as speculative when they themselves appears to have little to no knowledge of the history of investing and why things are the way they have been.
zhdc1 5y ago
> I’m blown away by how anti-crypto this discussion is. I hadn’t realized how negative the prevailing sentiment is on Hacker News. The more I learn about crypto (which isn't a lot), the more I agree that digital currency is the way ahead. I'm not convinced that decentralized ledger-based crypto is going to win out in the long term. Let's be honest, is there any coin at the moment that you would trust as a stable store of value and not a speculative investment? Fiat currency goes down in value over time, but most central banks are good enough at keeping the rate of loss relatively constant. Most, although not all, coins are also less than ideal for conducting transactions. There's also a regulatory aspect that, for some reason, is generally discounted by advocates. However, I could definitely see something like GNU Taler gaining widespread adoption, especially if central banks make good on releasing digital currency. There's no reason for consumers or merchants to pay anything more than absolutely minimal transaction fees on purchases. There's also no reason that electronic payments or transfers can't post in near real time.
- aaronsimpson 5y ago
  Even if the future of decentralized ledger cryptocurrency isn't bright, accelerating adoption of digital currencies is a good step forward. If that's all crypto ever accomplishes, I think it'll be a success. Some of course have concerns about privacy, tracking, etc., but the speed of payment rails in our current system is ridiculous given the technology we have.
- saul_goodman 5y ago
  I somewhat agree with your sentiment: the outcome is sort of the same but for different reasons. > "but most central banks are good enough at keeping the rate of loss relatively constant" The past two years clearly demonstrated central banks deliberately set the rate of annual inflation to a desired level in a much more directed way than anyone realized. At least for business as usual economies. Once you see inflation as a tax it starts to make more sense. But the end result is a "mostly" responsible entity in control of the inflation rate, so the sentiment is same: traditional fiat currencies will be more stable for a while to come, maby forever (when compared to crypto). > "I'm not convinced that decentralized ledger-based crypto is going to win out in the long term" Blockchain was designed to surpass the problems the pre-Bitcoin E-gold service hit: the government can always smite you by raiding your office and taking the servers. That's the sole problem Blockchain solves, nothing more. In that sense it's already proven itself as a successful technology. Otherwise, if you're a government-sanctioned entity there's no need to fool with Blockchain when rolling a CBDC: your main physical risks are terrorists and natural disasters, not smiting by a police raid. > "especially if central banks make good on releasing digital currency" It's coming, but it's not what people want it to be. The Fed is saying "we're not trying to kill off cash" while putting out open calls to investigate all the things they need to do in order to kill off cash. Another issue here that I don't see being talked about is that the very nature of stable-coins exposes these assets to the inflation rate that the asset is pegged to. This means it's getting taxed, and so it makes sense for the Fed to want to get into the crypto world from that standpoint. https://www.federalreserve.gov/publications/files/money-and-payments-20220120.pdf https://www.federalreserve.gov/publications/files/money-and-... https://www.federalreserve.gov/econres/ifdp/files/ifdp1334.pdf https://www.federalreserve.gov/econres/ifdp/files/ifdp1334.p... The major danger with CBDC is that this is going to be used along with social credit scores. We just saw Canada lock bank accounts of anyone who donated to the trucker protest. These people are f#$%ed. Now imagine if they were locked out of using cash as well - even that emergency stash under the couch cushion would be useless to buy food. It's a nightmare situation and it's coming sooner than later. But again, governments and central banks don't need this level of power, governments have proven they will seize bank accounts of those they disagree with. But cash still allows people to move around these barriers. Once CBDC's roll out it's a very bleak outlook. https://www.youtube.com/watch?v=rpNnTuK5JJU https://www.youtube.com/watch?v=rpNnTuK5JJU https://www.coindesk.com/policy/2021/12/30/mexico-plans-to-issue-a-cbdc-by-2024-government-confirms/ https://www.coindesk.com/policy/2021/12/30/mexico-plans-to-i...
cors-fls 5y ago
> Another argument is that crypto enables ransomware attacks. This to me sounds akin to saying “encryption enables child exploitation”. I.e. it focuses on one abhorrent element of society that would take place no matter what and blames its existence on a system which has great potential for good, a kind of propagandist thinking. You are biased too. How about comparing "crypto enables ransomware" to "unregulated gun sales enable mass shootings" ? Most western countries have regulated gun sales to avoid mass shootings, it works and the people sees this as a positive thing. OK, it's controversial so replace "gun" with something else that is forbidden in the US for the greater good. Compared to "guns for everyone", encryption has a lot of usages that are necessary (and beneficial). That's why banning encryption on the pretense of child exploitation is a mistake. What does crypto bring to the table that is as necessary and beneficial as encryption ? Is it more like encryption or more like guns ? On the other hand you also have to compare the bad side : is enabling ransomware as bad as enabling child exploitation or mass shootings ? (certainly not).
throwaway4good 5y ago
It has become more and more obvious that cryptocurrency, like the gold as sound money movement before it, has a strong political side and is deep in bed with the alternative right. I think that explains part of the strong hn reaction to it. The other side is software architecture of it, where crazy resources are spent making some parts decentralized, while other parts are centralized and ignore, creating a broken, overcomplex beast.
JumpCrisscross 5y ago
> Banks will be hurt by crypto Anyone saying this is talking bollocks. Wall Street hasn’t seen a bonanza like crypto since ‘06. Hedge funds are having their best fundraising years since the 80s, largely on the back of crypto-related trading. The best balance I can come up for crypto is to mandate KYC at all on and off ramps, tax its trading like the luxury good it is (maybe using the proceeds to fund law enforcement around scams) and ban or surtax mining using American power sources. (Let others spike their power prices and pay us for it.)
- ramesh31 5y ago
  >The best balance I can come up for crypto is to mandate KYC at all on and off ramps That would drive the value basically to zero, since the entirety of all crypto market caps are based on their ability to facilitate digital crimes.
  - JumpCrisscross 5y ago
    One, KYC in America does nothing for the rest of the world. Two, we know that’s not true. The aforementioned hedge funds could keep the flywheel going on their own.
    - ramesh31 5y ago
      You're implying that the hedge funds aren't involved solely to get a piece of the racket
  - Karunamon 5y ago
    Do you have a single fact to back up this extraordinary claim?
    - JumpCrisscross 5y ago
      > Do you have a single fact to back up this extraordinary claim? Which claim?
    - 5y ago
pibechorro 5y ago
Dont underestimate people bitter they missed out on early adoption and also paid shills.
nonameiguess 5y ago
So, there may be more, but there are at least four types of goods one might hold: * Consumer/durable goods meant to be used - i.e. dishwashers, houses you live in, furniture * Appreciating assets meant to grow long-term wealth - i.e. ownership shares in productive companies expected to last a while and earn profits, houses you rent to others, land itself * Bets and hedges - i.e. insurance policies, credit default swaps, futures contracts, the Bengals at +3500 or whatever * A medium of exchange - some highly liquid, low fee, stable-valued token meant to be held temporarily to eliminate the need for either direct barter or trust in delayed-delivery transactions Cryptocurrency just needs to get its story straight on which of these it is. Clearly a good can cross categories. People make bets in foreign exchange markets for currencies, as well as hedges when they actually do business internationally. Even owner-occupied housing can be seen as a strategy to grow intergenerational wealth. Beanie babies and baseball cards are consumer goods that may or may not over some limited period of time see dramatic increases in dollar-denominated value. But fundamentally, you don't want a medium of exchange to cross over into other categories, at least not often. Rapidly decreasing value causes panic and social collapse. Rapidly increasing value encourages holding rather than spending, which brings the productive economy to a halt. Even just having direct use value may do that. You don't want collectible stamps or commemorative silver coins to be a primary medium of exchange because many holders will not want to exchange them, and same problem, the trade of real goods grinds to a halt. Cryptocurrencies seemed to start off as a basically sound idea. Hashcash and proof of work were originally developed as anti-spam, anti-DoS measures. Make a client prove it did a bunch of useless work before it can send a request or message, as a natural rate-limiter. Satoshi came along and realized the tokens generated by this useless work have some level of fundamental value, and when traded on a blockchain, can allow for trustless transactions without the need for a single authority. All fine. But as soon as it got pulled almost entirely into the realm of speculators whose primary aim is to increase the dollar-denominated value of the tokens, it lost any potential to replace normal currency. I don't think there is anything inherently bad or immoral about people sending each other what amounts to gigantic piles of dirt proving they have the strongest automated digging machine and convincing others who have a lot of cash that buying the dirt piles is a better wealth growing strategy than buying companies and land and other traditional investments, but it isn't exactly the revolution we were promised.
ramesh31 5y ago
>I’m blown away by how anti-crypto this discussion is. I hadn’t realized how negative the prevailing sentiment is on Hacker News. There was a dream that was crypto once upon a time. It is now exclusively the domain of organized crime, grifters, and every imaginable permutation of ne'er-do-well you can possibly scrape up on the web. The entire space sickens and disappoints me.
- tastyfreeze 5y ago
  All of those things exist with anything that is easily exchangeable and valuable. I am confident there are more people using crypto for legitimate purposes than there are scammers. I would question why examples of ne'er-do-wells in crypto is all you hear about.
Lordarminius 5y ago
Most HN readers work for Web2 companies and are invested in the past. Nothing to see here
kube-system 5y ago
> Another argument is that crypto enables ransomware attacks. Whether or not you have a positive opinion of cryptocurrencies, this is factual. In order to successfully demand a ransom, you must have a way to get paid. For ransomware, you need something you can do remotely around the world, and something that can’t be blocked or reversed by the authorities. Cryptocurrencies were the first solution for this.
spaceisballer 5y ago
I for one am surprised by the negative sentiment only because the tech industry seems to be all about it. I don’t see the problem it is trying to fix. Crypto by is terrible as a currency, transactions are slow and damn can they cost a lot. And the currency itself fluctuates a lot. It’s not really decentralized, it’s not really anonymous and it can be manipulated. There seems to be no end to people hyping crypto and NFTs, because if I get you to buy in my money may go up. But what exactly am I buying? Sounds like you just need a sucker and I may or may not make money, but since you made up this currency and a small number of people own the lion’s share I guess you all get rich. My take is that the tech industry has just created a new way to become even richer by making some confusing product to prey off everyone. Maybe that wasn’t the initial plan but it sure looks like that’s how it’s shaking out.
- tomc1985 5y ago
  > I for one am surprised by the negative sentiment only because the tech industry seems to be all about it. Between the prevailing trend of rent-seeking subscriptions and shoving NFTs/blockchain into anything that some knucklehead thinks it will fit in, tech is very much becoming grift culture as the nerds get run over by sharks, business types, and crypto bros
  - convolvatron 5y ago
    that trend started 30 years ago
    - tomc1985 5y ago
      The running-over bit, sure, but I feel like this neofintech stuff is enabling a whole new cohort of grifters
    - blaser-waffle 5y ago
      The difference is they're so much better at it now. Social media allows for efficient targeting, and even if you know how marketing works it will work on you eventually.
rgrieselhuber 5y ago
I've noticed a correlation in attitudes between strong buy-in to establishment narratives on almost any topic and a rather overt hostility toward any challengers to fiat monetary systems.
- rgrieselhuber 5y ago
  As the downvotes illustrate perfectly. The shared characteristic in both points is the presupposition that coercion is an acceptable foundation for building systems.
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exdsq 5y ago
I actually got so stressed defending Crypto because a lot of the attacks get very personal (all people working on it are scammers, I’d never hire someone with web3 on their cv, etc). I kind of wish @dang would add a new rule regarding crypto because it’s always the same conversation but does hurt those working in the field on HN earnestly. Edit: Even this gets downvoted lol
magicjosh 5y ago
Anti-crypto HN is real! I still have not found the HN-like community that gets cryptocurrencies. Maybe it's just being created today. People say Twitter but it's still pretty meme oriented. /r/ethfinance is ok but not enough content. Zero Knowledge podcast is solid but podcasts are one way communication. And the forums for cryotocurrency developers are beyond my level of tech knowledge. I wonder if at some point anthropologists will even study "tech's rejection of crypto" as a rift that became something more.
- graphpercolator 5y ago
- xadhominemx 5y ago
  Oh, we “get” crypto. What we also “get”, and what crypto people don’t, are the systems crypto is trying to replace and why the aspects crypto people think are flaws (centralization, arbitration, ability to reverse transactions) are all features
  - aaaaaaaaata 5y ago
    > (centralization, arbitration, ability to reverse transactions) are all features Don't sweat, this will all take place on Layer 2.
- aaaaaaaaata 5y ago
  Ethereum Magicians
BobbyJo 5y ago
> If you truly believe that cryptocurrency is the basis for a superior economic system This is the reason for the prevailing negative sentiment though. "Postgres will revolutionize the economy! Put all your money in unique keys!" Sounds crazy right? I mean, it might not be wrong, we all trade assets using special government cotton, but it is still a wild thing to hear as a software engineer, and an even wilder thing to see people bet their life savings on.
jcranmer 5y ago
> One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? So the thing about investments is that they are a transaction that gives you a share of property in exchange for a share of the future income stream, albeit this mechanism is often imperfect and valuation may not so directly correspond to the current value of the underlying property or income stream. Even if many people are buying investments solely with the intention of selling them to somebody else for the higher price, the reason to gamble and expect the price to go higher is because of the valuation of the property. Even the miserly interest you get from parking cash in a bank account is tied to the income the bank makes from using the money you so parked. But with Bitcoin, when you buy a bitcoin, you get a share of... well, nothing. And the way you make money with that share of nothing is to sell it to somebody else for a higher value. That's the only way to make money: you can't make money except by enticing new entrants, which is literally the definition of Ponzi scheme. And other investments aren't Ponzi schemes because there are other ways to make money from the investment, even if they aren't necessarily the most common way of making money. This doesn't necessarily hold true for all cryptocurrencies; I'll concede that I'm not a connoisseur of the cryptocurrency community. But it feels to me like it's the standard tech-bro "X, but unregulated", except "X" here is finance, an industry which is famous for its unregulated elements not only resulting in lots of people losing all of their money but also bringing the economy down with it. So forgive me if I'm not exactly enthusiastic here.
SamoyedFurFluff 5y ago
One of my concerns about cryptocurrency is the potential for the lack of regulation to allow for scammers, pyramid and pump&dump scemes, etc. I’ve heard of more than one undereducated immigrant family having life savings absolutely devastated due to this in a way that one would at least have case law and existing recourse if this happened in a traditional structure. Additionally I doubt that cryptocurrency is disrupting wealth inequality. The major participants were all wealthy to begin and all of the increased interest seems to circle around the most wealthy… so it actually just contributes to wealth inequality. (In the documentary there is even apparently an mmo that people play to earn cryptocurrency tokens that goes into the wallet of an employer who then pays them a wage, with performance reviews and firings. Idk this looks to me only of recreating the same wage slavery and wealth grift that the original money system has.)
wintermutestwin 5y ago
Here's another couple arguments for you: 1. Crypto's primary use today seems to be money laundering and other unsavory "darknet-ish" things. It seems like it would be an unnecessary risk to associate your financial persona with such illicit activities. 2. When markets tanked due to Coivd, crypto went right down with it.
deleted 5y ago
[deleted]
ideamotor 5y ago
You want to trade a system that has decayed with a system that is deliberately rotten. Banks and securities are regulated, have some limited democratic governance, and crypto is designed to not have these things. That’s definitely propagandist thinking, mixed with a cherry picking and a dash of confirmation bias. What’s shocking is that people share your views in good faith.
throwthere 5y ago
What's weird is I don't see any anti-crypto comments except in reply to your anti-anti thoughts. The arguments you're stating seem mostly straw-men to me. Some people get very very excited about crypto and kind of overly sensitive to discourse. I think some of that is early-adopter fervor. Some of it, too, could be the understanding that the more adoption it gets the better the party is. The higher coin-caps go, the more respect, legitimacy and outside resources they command. Take stocks on the other hand. If you tell me the stocks I'm buying are worthless-- that's good for me! It means you're not buying and driving the prices up when I buy and better prices when the businesses repurchase shares. So maybe that's partly why I don't care when people disparage stock ownership. Point is, sometimes I wish labels like "pro-" or "anti-" crypto fell out of use-- it's a complex topic and most thoughtful people have more nuanced views.
JaimeThompson 5y ago
Crypto isn't about getting rid of middle men, it is about putting new ones in their place with much less consumer protections for those who are harmed by the actions of those middlemen.
joelbondurant1 5y ago
[dead]
Isamu 5y ago
> I hadn’t realized how negative the prevailing sentiment is on Hacker News. I think cryptocurrency is polarizing. While the technology is interesting, the current landscape of related businesses is discouraging. > One argument seems to be that cryptocurrency is purely speculative With stock you get part ownership. Buying gold relies on the inherent demand for and usefulness of gold as a metal. Cryptocurrency is like exchanging your country’s paper money for other paper money that is hard to counterfeit but is not backed by any country. It might be okay if your country’s money is crap.

by nrzd 5y ago

afpx 5y ago

Bitcoin was some neat tech. But, in case you haven’t noticed it’s been taken over by finance bros. Now, it’s just a scam to prey on the poor and ignorant.

danuker 5y ago
How is it a scam? Does it not still offer the same tech? In fact, with Lightning, even more advanced tech.
johndevor 5y ago
Wait until you hear about fiat currencies.
- l-lousy 5y ago
  I think that’s the argument, why move to a whole new currency if it’s more of the same problems with fewer safeguards for the non technical and no way to get lost items back?
  - aaaaaaaaata 5y ago
    Why would the poor have wanted to switch to the Internet? After all, it required expensive custom hardware, and know-how. What changed? Have you considered it's just really early days?
    - floodyberry- 5y ago
      "really early days" is an argument that a lot more work is needed, not that everyone should go all in knowing there is going to be a lot of collateral damage along the way even _if_ it works out.
    - Hoasi 5y ago
      > Have you considered it's just really early days? How many years do early days last?
      - aaaaaaaaata 5y ago
        Well, once again, using the Internet as a very easy to reach example....decades?
    - acdha 5y ago
      > Why would the poor have wanted to switch to the Internet? Look at the history and this is easily answered: it let them do things better/easier/cheaper. That could be shopping, accessing government services, dealing with companies, finding a job, seeking educational material, entertainment, dating, connecting with friends and family (email was a pretty sweet alternative to long distance phone calls), etc. The internet picked up sharply as computers came down in price and people tried even cheaper options like WebTV because there was so much demand, and that started happening very quickly. In contrast, cryptocurrency had much lower barriers to entry but despite having at least twice as many years by that point it has very little non-speculative usage because it doesn’t do anything most people care about. Even being a cheaper PayPal/Venmo would be an improvement.
- lr4444lr 5y ago
  You can pay your taxes, fines, and court ordered debts with fiat currency. It's arguably THE MOST stable thing in a functioning society above pure barter.
  - danuker 5y ago
    Try saving for retirement. At 2% inflation (the target rate), after 20 years you'd lose 1 - (.98 ^ 20) = 33.2% of the purchasing power of your savings. But right now, inflation is 7.5% year-over-year. And that's the official measure, which uses "owners' equivalent rent" based on a survey, instead of actual rent prices. In the past 20 years (Jan 2002 - Jan 2022), the CPI went from 177.7 to 281.933, or a 58.6% increase. This means a 2.3% average inflation rate. https://tradingeconomics.com/united-states/inflation-cpi https://tradingeconomics.com/united-states/inflation-cpi https://www.investopedia.com/terms/o/owners-equivalent-rent.asp https://www.investopedia.com/terms/o/owners-equivalent-rent....
    - Spoom 5y ago
      This implies that your retirement savings are in cash, which is inaccurate for most folks. And certainly, I'd rather have it invested in the stock market than the wild fluctuations of the crypto market, especially with its uncertain withdrawal ability and complete inability to recover if someone steals it (which is, again, typically much easier with crypto than a brokerage).
      - danuker 5y ago
        The previous comment said cash is stable. I was illustrating that it is stably losing value.
        kravens_last 5y ago
        Would you rather stably losing purchase power at a predictable pace over time (fiat) or exponentially unstable purchase power in perpetuity (bitcoin)?
    - 5y ago
- UncleMeat 5y ago
  New things aren't always better. Yes, existing financial systems are terrible. They are rampant with abuse, manipulation, and people converting human behavior into abstract objects that they can gamble on so that they can extract wealth without providing value and they do this to the point that they introduce systemic risk to our entire society. Cryptocurrency is this times 1000. It is the financialization of everything. Instead of mortgages being packaged up into bonds and then derivatives of those bonds, everything gets packaged up into financial instruments and then derivatives of those instruments. Something like ETH makes it very easy to write programs that move tokens that are worth dollars based on inputs taken from the ledger itself. That inevitably encourages a sort of hyper-financial system. That's worse.
lawn 5y ago
Yes, most of the loud discussion is by crypto bros that want to get rich and don't care and don't understand the technology. I understand that the negative sentiment is a counter-reaction to the crypto bros, but a little more nuance would be welcome.

thrwyoilarticle 5y ago

>What about the stock market? What about any kind of investment? You mean the kind that pay dividends?

PretzelPirate 5y ago
What percentage of stocks pay dividends?
- mlac 5y ago
  I don’t have a percentage, but here are 25 to start with: https://www.nerdwallet.com/article/investing/how-to-invest-dividend-stocks https://www.nerdwallet.com/article/investing/how-to-invest-d...
danuker 5y ago
There are companies paying dividends, and companies reinvesting profit. What difference does it make?
pjc50 5y ago
Before a stupid argument breaks out, everyone please note that a stock buyback is basically equivalent to a dividend with a different tax treatment; both are returning money to investors. It's also theoretically possible for some of the crypto-token-organisation things to pay dividends, but it's far more common for them to simply take the money and run. Because a token is not a legal framework like a company is.
aaaaaaaaata 5y ago
You mean payments/yield from staking?

joshjdr 5y ago

“Purely speculative” is what makes it more akin to gambling than investing in income generating assets.

PretzelPirate 5y ago
Crypto can be an income-generating asset just like any stock that pays dividends. You can use lending protocols or act as a liquidity provider and, in many cases, have your income earned in a stable coin (such as USDC).
- pjc50 5y ago
  Hilariously, crypto has reinvented fractional reserve banking. "Staking" is just traditional fixed-duration lending, but with some weird caveats and liquidation rules borrowed from margin trading that you need to read carefully.
  - cuteboy19 5y ago
    Most importantly, it has no real guarantee. There is no reason why our beloved Tether inc can't just vanish from its Cayman Islands headquarters one day

dangoor 5y ago

> One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? I recommend not using the "what about the stock market?" tactic to defend cryptocurrencies. Crypto is more speculative than the stock market because companies have physical assets, ongoing revenue and profits, dividends that they pay out to their shareholders.

mantenpanther 5y ago
Bitcoin is anchored in physics and math. And used by millions without western privileges.
- mlac 5y ago
  Highway infrastructure is also anchored in physics and math. It doesn’t mean we should treat highways like a currency that should be purchased and traded. Starting a business is open for millions “without western privileges” - and stock is owning a business. Starting a profitable business that adds value (people are willing to pay you for a service) is a lot more useful to society than spinning up another coin that does nothing.
  - throwthere 5y ago
    > Highway infrastructure is also anchored in physics and math. It doesn’t mean we should treat highways like a currency that should be purchased and traded. Clearly, the world needs highway-based NFTs. Knowing that their ephemeral infrastructure is represented on the blockchain, something that is permanent, will lead to engineers building safer bridges. It will encourage the development of new fields of engineering, perhaps subfields related to structures and others related to materials. Contrast that to the stock market, where companies sell ownership shares in their businesses tracked in ledgers maintained by western corporations. And some of the underlying businesses have no plans to ever to distribute cash to their stock owners-- look at Berkshire Hathaway! Look at Google! People buy and sell those shares only because the next person will buy them for more. It's a classic speculative investment, not like crypto which is backed by the full faith and power of NVIDIA. /s. Or is it?

chrisseaton 5y ago

> If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? Presumably the people you’re talking about don’t think that, so no it wouldn’t be rational for them.

concinds 5y ago

Most of the anti-crypto critiques in Silicon Valley bring up these exact arguments: it's speculative, and it enables scams. At its root, it's a hatred of the "get rich quick" aspects of crypto. It evokes the same contempt that old-wealth (people with butlers) have for new-wealth (people with Lamborghinis): that they're childish, didn't earn their privileges, and need to be reined in. It's class signalling. Thankfully crypto isn't a democracy. Money market funds, banks, stock exchanges, and every other financial institution can be frozen instantaneously by the U.S. President to "prevent another financial collapse". Those who are OK with that much power being concentrated in one person, can continue avoiding crypto. But no amount of public outcry can ban, shut down or criminalize crypto, same as you can't ban IMAP or AES.

bluGill 5y ago
The government can criminalize crypto. Investigation wouldn't be easy, but the FBI and other equivalents (depending on your country) are very good at investigating hard to solve crimes, and if given the budget can track you down in various ways. (tax fraud is often a big one - even if they can't prove you are in crypto they can prove you didn't pay tax on something)
pjc50 5y ago
> But no amount of public outcry can ban, shut down or criminalize crypto, same as you can't ban IMAP or AES. This is a terrible example as the US government really did ban DES for a while - at least for "export", which includes publishing on the internet. People who say "the government can't ban X" are really badly underestimating how far governments are willing to go if you really do start disrupting the state.
- concinds 5y ago
  Yes, governments can try, but there will always be ways to fight it; including using sneakernet to exchange hardware wallets, instead of traceable on-blockchain transactions. Crypto is as impossible to ban as the internet at this point.
  - 5y ago

AlexandrB 5y ago

> One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? Most other assets represent ownership of... something. A company, a commodity, property. Cryptocurrency is closest to either a fiat currency without the government backing that typically tries to stabilize those. Or to more exotic and abstract financial instruments like credit default swaps or shorts. Basically what's missing is the ability to even guess at the "true" value of cryptocurrency. There's no P/E ratios to consider because the only thing Crypto "produces" is Crypto transactions. It's also impossible to even guess at a floor or ceiling for the price of a cryptocurrency. The only thing that determines their price is human sentiment - a very fickle input. Because of this, it's likely that cryptocurrency is vulnerable to market manipulation. Both through large transactions and through marketing. See also: the ample evidence of wash trading in the NFT space. In these kinds of situations my feeling is that if I'm not the one doing the manipulating then I'm the sucker on the other end.

aqme28 5y ago
> Basically what's missing is the ability to even guess at the "true" value of cryptocurrency. There's no P/E ratios to consider because the only thing Crypto "produces" is Crypto transactions. It's also impossible to even guess at a floor or ceiling for the price of a cryptocurrency. The only thing that determines their price is human sentiment - a very fickle input. Interestingly, this isn't really true anymore. Most of the newer defi currencies represent a portion of ownership in some protocol that is actually returning profits. E.g. Maker is a lending platform for DAI. You can borrow DAI by depositing other currencies as collateral. The interest you pay to borrow is then converted by Maker into a sort of "stock buyback" against its Maker token. The Maker token has a P/E ratio, as do many other coins. https://www.tokenterminal.com/ https://www.tokenterminal.com/ To your point though, the P/E ratio for most of these is denominated in other cryptocurrencies, not in USD.
- meragrin_ 5y ago
  > ownership in some protocol But what is the value of the protocol? > actually returning profits Are there actually profits if the protocol is worthless?

bluGill 5y ago

There are different types of speculative investments. Stocks are backed by the company they are behind, when the company goes out of business the stocks stop trading. When you own stocks you vote on company leadership (or at least should). When the company makes money they pay you cash as a dividend (for tax reasons this most often comes in the form of a stock buy back making your stock more valuable. As such stock speculation on the company not stocks in general. Historically money was backed by gold, and supply and demand of gold is what governed the price. Today cash is not, and it is only backed by the government saying you have to use it. As such cash is more speculative than stocks, but the government forcing you to use it means it has some power behind it. Bitcoin is backed by some governments, so bitcoin is speculation on those governments (this is new in the past few years and makes bitcoin somewhat less speculative than other crypto) I don't see the point of crypto in the end. Almost everything it can do is better done by a secure central database, and the rest is a niche that can be handled by physical cash, or a contract (ie check) that is reconciled with the database later. Sure you could use cyrpto, but the energy costs are so much larger that I don't think we as a society can afford to use it.

logifail 5y ago
> When the company makes money they pay you cash as a dividend (for tax reasons this most often comes in the form of a stock buy back [...]) Often? "Nearly 75% of the stocks in the S&P 500 pay a dividend, and the dividend for most of them exceeds the yield on U.S. 10-year Treasury bonds (currently around 2%)"[0] [0] https://cabotwealth.com/daily/dividend-stocks/highest-paying-dividend-stocks-sp-500/ https://cabotwealth.com/daily/dividend-stocks/highest-paying...
- bluGill 5y ago
  Even companies that pay a dividend buy back stocks.

bombcar 5y ago

Even assuming that crypto currency does provide value and wins out in the end - why would it be any of the existing ones as opposed to a new one started by the right players?

unstatusthequo 5y ago

Agree with you on all of that. The general HN sentiment towards cryptocurrency is so acutely negative. I generally don’t even bother clicking links related to it because of this issue. Its just asking for whiny diatribes about how crypto sucks and will ruin everything. It’s ironic to me how freedom loving HN can be, until it is finance related and threatening governments and banks but empowering the masses. Seems bizarre to me. I’ll exit before the “uses too much energy” dissertations enter. I bet your stacks of bare metal severs and electric cars and hairdryers and ovens and water furnaces and electric heaters and gaming machines and four monitor dev setups are super green. Could crypto be better at using less energy? Probably. Could those other things? Yep. Is progress on efficiency being made? Well, yes, at least crypto is trying to do so with PoS etc. can’t say the same for your heavy old appliances.

spaceisballer 5y ago
So all the things you have listed consuming energy have uses. They are doing something. Can they be more efficient, sure. What exactly is crypto doing? What is it solving? The crypto industry keeps growing and consuming video cards, processors and energy. To do what? So if it’s a currency it’s not even close to the efficiency and speed of the current financial system. Ease of use too, not even close. People are making money though, so I guess we don’t question it?

Blackstone4 5y ago

>One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? I feel like it is a black and white and naive view to categorize every financial instrument as purely speculative. They exist along a spectrum ranging from on one hand, sound investments (i.e. US treasuries), all the way to more speculative plays like sports betting. Where an asset sits on the spectrum is a subjective to the eye of the beholder but concensus among investors at this time would probably place US treasuries, blue chip corporate bonds, US stocks in the sound investment half and crypto in the more speculative half. In part because new technology which makes some wary and in part because crypto is a form of currency where most participants appear to be 'investing' on the basis they can sell it to someone else at a higher price. Which sounds fine but normally stocks or US treasuries are underpinned by interest payments, dividends or promise of future dividends through earnings growth whereas most crypto does not have an of these characteristics. I am blown away by the number of people claiming to be knowledgeable crypto investors who are dismissive of other investment types as speculative when they themselves appears to have little to no knowledge of the history of investing and why things are the way they have been.

zhdc1 5y ago

> I’m blown away by how anti-crypto this discussion is. I hadn’t realized how negative the prevailing sentiment is on Hacker News. The more I learn about crypto (which isn't a lot), the more I agree that digital currency is the way ahead. I'm not convinced that decentralized ledger-based crypto is going to win out in the long term. Let's be honest, is there any coin at the moment that you would trust as a stable store of value and not a speculative investment? Fiat currency goes down in value over time, but most central banks are good enough at keeping the rate of loss relatively constant. Most, although not all, coins are also less than ideal for conducting transactions. There's also a regulatory aspect that, for some reason, is generally discounted by advocates. However, I could definitely see something like GNU Taler gaining widespread adoption, especially if central banks make good on releasing digital currency. There's no reason for consumers or merchants to pay anything more than absolutely minimal transaction fees on purchases. There's also no reason that electronic payments or transfers can't post in near real time.

aaronsimpson 5y ago
Even if the future of decentralized ledger cryptocurrency isn't bright, accelerating adoption of digital currencies is a good step forward. If that's all crypto ever accomplishes, I think it'll be a success. Some of course have concerns about privacy, tracking, etc., but the speed of payment rails in our current system is ridiculous given the technology we have.
saul_goodman 5y ago
I somewhat agree with your sentiment: the outcome is sort of the same but for different reasons. > "but most central banks are good enough at keeping the rate of loss relatively constant" The past two years clearly demonstrated central banks deliberately set the rate of annual inflation to a desired level in a much more directed way than anyone realized. At least for business as usual economies. Once you see inflation as a tax it starts to make more sense. But the end result is a "mostly" responsible entity in control of the inflation rate, so the sentiment is same: traditional fiat currencies will be more stable for a while to come, maby forever (when compared to crypto). > "I'm not convinced that decentralized ledger-based crypto is going to win out in the long term" Blockchain was designed to surpass the problems the pre-Bitcoin E-gold service hit: the government can always smite you by raiding your office and taking the servers. That's the sole problem Blockchain solves, nothing more. In that sense it's already proven itself as a successful technology. Otherwise, if you're a government-sanctioned entity there's no need to fool with Blockchain when rolling a CBDC: your main physical risks are terrorists and natural disasters, not smiting by a police raid. > "especially if central banks make good on releasing digital currency" It's coming, but it's not what people want it to be. The Fed is saying "we're not trying to kill off cash" while putting out open calls to investigate all the things they need to do in order to kill off cash. Another issue here that I don't see being talked about is that the very nature of stable-coins exposes these assets to the inflation rate that the asset is pegged to. This means it's getting taxed, and so it makes sense for the Fed to want to get into the crypto world from that standpoint. https://www.federalreserve.gov/publications/files/money-and-payments-20220120.pdf https://www.federalreserve.gov/publications/files/money-and-... https://www.federalreserve.gov/econres/ifdp/files/ifdp1334.pdf https://www.federalreserve.gov/econres/ifdp/files/ifdp1334.p... The major danger with CBDC is that this is going to be used along with social credit scores. We just saw Canada lock bank accounts of anyone who donated to the trucker protest. These people are f#$%ed. Now imagine if they were locked out of using cash as well - even that emergency stash under the couch cushion would be useless to buy food. It's a nightmare situation and it's coming sooner than later. But again, governments and central banks don't need this level of power, governments have proven they will seize bank accounts of those they disagree with. But cash still allows people to move around these barriers. Once CBDC's roll out it's a very bleak outlook. https://www.youtube.com/watch?v=rpNnTuK5JJU https://www.youtube.com/watch?v=rpNnTuK5JJU https://www.coindesk.com/policy/2021/12/30/mexico-plans-to-issue-a-cbdc-by-2024-government-confirms/ https://www.coindesk.com/policy/2021/12/30/mexico-plans-to-i...

cors-fls 5y ago

> Another argument is that crypto enables ransomware attacks. This to me sounds akin to saying “encryption enables child exploitation”. I.e. it focuses on one abhorrent element of society that would take place no matter what and blames its existence on a system which has great potential for good, a kind of propagandist thinking. You are biased too. How about comparing "crypto enables ransomware" to "unregulated gun sales enable mass shootings" ? Most western countries have regulated gun sales to avoid mass shootings, it works and the people sees this as a positive thing. OK, it's controversial so replace "gun" with something else that is forbidden in the US for the greater good. Compared to "guns for everyone", encryption has a lot of usages that are necessary (and beneficial). That's why banning encryption on the pretense of child exploitation is a mistake. What does crypto bring to the table that is as necessary and beneficial as encryption ? Is it more like encryption or more like guns ? On the other hand you also have to compare the bad side : is enabling ransomware as bad as enabling child exploitation or mass shootings ? (certainly not).

throwaway4good 5y ago

It has become more and more obvious that cryptocurrency, like the gold as sound money movement before it, has a strong political side and is deep in bed with the alternative right. I think that explains part of the strong hn reaction to it. The other side is software architecture of it, where crazy resources are spent making some parts decentralized, while other parts are centralized and ignore, creating a broken, overcomplex beast.

JumpCrisscross 5y ago

> Banks will be hurt by crypto Anyone saying this is talking bollocks. Wall Street hasn’t seen a bonanza like crypto since ‘06. Hedge funds are having their best fundraising years since the 80s, largely on the back of crypto-related trading. The best balance I can come up for crypto is to mandate KYC at all on and off ramps, tax its trading like the luxury good it is (maybe using the proceeds to fund law enforcement around scams) and ban or surtax mining using American power sources. (Let others spike their power prices and pay us for it.)

ramesh31 5y ago
>The best balance I can come up for crypto is to mandate KYC at all on and off ramps That would drive the value basically to zero, since the entirety of all crypto market caps are based on their ability to facilitate digital crimes.
- JumpCrisscross 5y ago
  One, KYC in America does nothing for the rest of the world. Two, we know that’s not true. The aforementioned hedge funds could keep the flywheel going on their own.
  - ramesh31 5y ago
    You're implying that the hedge funds aren't involved solely to get a piece of the racket
- Karunamon 5y ago
  Do you have a single fact to back up this extraordinary claim?
  - JumpCrisscross 5y ago
    > Do you have a single fact to back up this extraordinary claim? Which claim?
  - 5y ago

pibechorro 5y ago

Dont underestimate people bitter they missed out on early adoption and also paid shills.

nonameiguess 5y ago

So, there may be more, but there are at least four types of goods one might hold: * Consumer/durable goods meant to be used - i.e. dishwashers, houses you live in, furniture * Appreciating assets meant to grow long-term wealth - i.e. ownership shares in productive companies expected to last a while and earn profits, houses you rent to others, land itself * Bets and hedges - i.e. insurance policies, credit default swaps, futures contracts, the Bengals at +3500 or whatever * A medium of exchange - some highly liquid, low fee, stable-valued token meant to be held temporarily to eliminate the need for either direct barter or trust in delayed-delivery transactions Cryptocurrency just needs to get its story straight on which of these it is. Clearly a good can cross categories. People make bets in foreign exchange markets for currencies, as well as hedges when they actually do business internationally. Even owner-occupied housing can be seen as a strategy to grow intergenerational wealth. Beanie babies and baseball cards are consumer goods that may or may not over some limited period of time see dramatic increases in dollar-denominated value. But fundamentally, you don't want a medium of exchange to cross over into other categories, at least not often. Rapidly decreasing value causes panic and social collapse. Rapidly increasing value encourages holding rather than spending, which brings the productive economy to a halt. Even just having direct use value may do that. You don't want collectible stamps or commemorative silver coins to be a primary medium of exchange because many holders will not want to exchange them, and same problem, the trade of real goods grinds to a halt. Cryptocurrencies seemed to start off as a basically sound idea. Hashcash and proof of work were originally developed as anti-spam, anti-DoS measures. Make a client prove it did a bunch of useless work before it can send a request or message, as a natural rate-limiter. Satoshi came along and realized the tokens generated by this useless work have some level of fundamental value, and when traded on a blockchain, can allow for trustless transactions without the need for a single authority. All fine. But as soon as it got pulled almost entirely into the realm of speculators whose primary aim is to increase the dollar-denominated value of the tokens, it lost any potential to replace normal currency. I don't think there is anything inherently bad or immoral about people sending each other what amounts to gigantic piles of dirt proving they have the strongest automated digging machine and convincing others who have a lot of cash that buying the dirt piles is a better wealth growing strategy than buying companies and land and other traditional investments, but it isn't exactly the revolution we were promised.

ramesh31 5y ago

>I’m blown away by how anti-crypto this discussion is. I hadn’t realized how negative the prevailing sentiment is on Hacker News. There was a dream that was crypto once upon a time. It is now exclusively the domain of organized crime, grifters, and every imaginable permutation of ne'er-do-well you can possibly scrape up on the web. The entire space sickens and disappoints me.

tastyfreeze 5y ago
All of those things exist with anything that is easily exchangeable and valuable. I am confident there are more people using crypto for legitimate purposes than there are scammers. I would question why examples of ne'er-do-wells in crypto is all you hear about.

Lordarminius 5y ago

Most HN readers work for Web2 companies and are invested in the past. Nothing to see here

kube-system 5y ago

> Another argument is that crypto enables ransomware attacks. Whether or not you have a positive opinion of cryptocurrencies, this is factual. In order to successfully demand a ransom, you must have a way to get paid. For ransomware, you need something you can do remotely around the world, and something that can’t be blocked or reversed by the authorities. Cryptocurrencies were the first solution for this.

spaceisballer 5y ago

I for one am surprised by the negative sentiment only because the tech industry seems to be all about it. I don’t see the problem it is trying to fix. Crypto by is terrible as a currency, transactions are slow and damn can they cost a lot. And the currency itself fluctuates a lot. It’s not really decentralized, it’s not really anonymous and it can be manipulated. There seems to be no end to people hyping crypto and NFTs, because if I get you to buy in my money may go up. But what exactly am I buying? Sounds like you just need a sucker and I may or may not make money, but since you made up this currency and a small number of people own the lion’s share I guess you all get rich. My take is that the tech industry has just created a new way to become even richer by making some confusing product to prey off everyone. Maybe that wasn’t the initial plan but it sure looks like that’s how it’s shaking out.

tomc1985 5y ago
> I for one am surprised by the negative sentiment only because the tech industry seems to be all about it. Between the prevailing trend of rent-seeking subscriptions and shoving NFTs/blockchain into anything that some knucklehead thinks it will fit in, tech is very much becoming grift culture as the nerds get run over by sharks, business types, and crypto bros
- convolvatron 5y ago
  that trend started 30 years ago
  - tomc1985 5y ago
    The running-over bit, sure, but I feel like this neofintech stuff is enabling a whole new cohort of grifters
  - blaser-waffle 5y ago
    The difference is they're so much better at it now. Social media allows for efficient targeting, and even if you know how marketing works it will work on you eventually.

rgrieselhuber 5y ago

I've noticed a correlation in attitudes between strong buy-in to establishment narratives on almost any topic and a rather overt hostility toward any challengers to fiat monetary systems.

rgrieselhuber 5y ago
As the downvotes illustrate perfectly. The shared characteristic in both points is the presupposition that coercion is an acceptable foundation for building systems.

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exdsq 5y ago

I actually got so stressed defending Crypto because a lot of the attacks get very personal (all people working on it are scammers, I’d never hire someone with web3 on their cv, etc). I kind of wish @dang would add a new rule regarding crypto because it’s always the same conversation but does hurt those working in the field on HN earnestly. Edit: Even this gets downvoted lol

magicjosh 5y ago

Anti-crypto HN is real! I still have not found the HN-like community that gets cryptocurrencies. Maybe it's just being created today. People say Twitter but it's still pretty meme oriented. /r/ethfinance is ok but not enough content. Zero Knowledge podcast is solid but podcasts are one way communication. And the forums for cryotocurrency developers are beyond my level of tech knowledge. I wonder if at some point anthropologists will even study "tech's rejection of crypto" as a rift that became something more.

graphpercolator 5y ago
xadhominemx 5y ago
Oh, we “get” crypto. What we also “get”, and what crypto people don’t, are the systems crypto is trying to replace and why the aspects crypto people think are flaws (centralization, arbitration, ability to reverse transactions) are all features
- aaaaaaaaata 5y ago
  > (centralization, arbitration, ability to reverse transactions) are all features Don't sweat, this will all take place on Layer 2.
aaaaaaaaata 5y ago
Ethereum Magicians

BobbyJo 5y ago

> If you truly believe that cryptocurrency is the basis for a superior economic system This is the reason for the prevailing negative sentiment though. "Postgres will revolutionize the economy! Put all your money in unique keys!" Sounds crazy right? I mean, it might not be wrong, we all trade assets using special government cotton, but it is still a wild thing to hear as a software engineer, and an even wilder thing to see people bet their life savings on.

jcranmer 5y ago

> One argument seems to be that cryptocurrency is purely speculative, which is apparently a dirty word. What about the stock market? What about any kind of investment? If you truly believe that cryptocurrency is the basis for a superior economic system, isn’t it rational and wise to put some of your savings there? So the thing about investments is that they are a transaction that gives you a share of property in exchange for a share of the future income stream, albeit this mechanism is often imperfect and valuation may not so directly correspond to the current value of the underlying property or income stream. Even if many people are buying investments solely with the intention of selling them to somebody else for the higher price, the reason to gamble and expect the price to go higher is because of the valuation of the property. Even the miserly interest you get from parking cash in a bank account is tied to the income the bank makes from using the money you so parked. But with Bitcoin, when you buy a bitcoin, you get a share of... well, nothing. And the way you make money with that share of nothing is to sell it to somebody else for a higher value. That's the only way to make money: you can't make money except by enticing new entrants, which is literally the definition of Ponzi scheme. And other investments aren't Ponzi schemes because there are other ways to make money from the investment, even if they aren't necessarily the most common way of making money. This doesn't necessarily hold true for all cryptocurrencies; I'll concede that I'm not a connoisseur of the cryptocurrency community. But it feels to me like it's the standard tech-bro "X, but unregulated", except "X" here is finance, an industry which is famous for its unregulated elements not only resulting in lots of people losing all of their money but also bringing the economy down with it. So forgive me if I'm not exactly enthusiastic here.

SamoyedFurFluff 5y ago

One of my concerns about cryptocurrency is the potential for the lack of regulation to allow for scammers, pyramid and pump&dump scemes, etc. I’ve heard of more than one undereducated immigrant family having life savings absolutely devastated due to this in a way that one would at least have case law and existing recourse if this happened in a traditional structure. Additionally I doubt that cryptocurrency is disrupting wealth inequality. The major participants were all wealthy to begin and all of the increased interest seems to circle around the most wealthy… so it actually just contributes to wealth inequality. (In the documentary there is even apparently an mmo that people play to earn cryptocurrency tokens that goes into the wallet of an employer who then pays them a wage, with performance reviews and firings. Idk this looks to me only of recreating the same wage slavery and wealth grift that the original money system has.)

wintermutestwin 5y ago

Here's another couple arguments for you: 1. Crypto's primary use today seems to be money laundering and other unsavory "darknet-ish" things. It seems like it would be an unnecessary risk to associate your financial persona with such illicit activities. 2. When markets tanked due to Coivd, crypto went right down with it.

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ideamotor 5y ago

You want to trade a system that has decayed with a system that is deliberately rotten. Banks and securities are regulated, have some limited democratic governance, and crypto is designed to not have these things. That’s definitely propagandist thinking, mixed with a cherry picking and a dash of confirmation bias. What’s shocking is that people share your views in good faith.

throwthere 5y ago

What's weird is I don't see any anti-crypto comments except in reply to your anti-anti thoughts. The arguments you're stating seem mostly straw-men to me. Some people get very very excited about crypto and kind of overly sensitive to discourse. I think some of that is early-adopter fervor. Some of it, too, could be the understanding that the more adoption it gets the better the party is. The higher coin-caps go, the more respect, legitimacy and outside resources they command. Take stocks on the other hand. If you tell me the stocks I'm buying are worthless-- that's good for me! It means you're not buying and driving the prices up when I buy and better prices when the businesses repurchase shares. So maybe that's partly why I don't care when people disparage stock ownership. Point is, sometimes I wish labels like "pro-" or "anti-" crypto fell out of use-- it's a complex topic and most thoughtful people have more nuanced views.

JaimeThompson 5y ago

Crypto isn't about getting rid of middle men, it is about putting new ones in their place with much less consumer protections for those who are harmed by the actions of those middlemen.

joelbondurant1 5y ago

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Isamu 5y ago

> I hadn’t realized how negative the prevailing sentiment is on Hacker News. I think cryptocurrency is polarizing. While the technology is interesting, the current landscape of related businesses is discouraging. > One argument seems to be that cryptocurrency is purely speculative With stock you get part ownership. Buying gold relies on the inherent demand for and usefulness of gold as a metal. Cryptocurrency is like exchanging your country’s paper money for other paper money that is hard to counterfeit but is not backed by any country. It might be okay if your country’s money is crap.