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Maybe the cryptocurrency sceptics on HN who live in stable western countries without any fear of their savings disappearing overnight can now understand why it

Maybe the cryptocurrency sceptics on HN who live in stable western countries without any fear of their savings disappearing overnight can now understand why it is a valuable invention.

dgellow 5y ago
I would say the exact opposite. So much pressure can be applied against an oppressive fascist regime thanks to the fact that the world is still using fiat. Russia cannot be trusted as a trade partner when Putin, just one guy alone, decides to put at risk more than 25% of worldwide wheat export just to satisfy his personal dream of a lost past glory. He is using nuclear threats to satisfy his own ego. That type of insane behaviour should be completely inacceptable in a global economy and has to be exponentially expensive to do if we want stable peace. Trust between trade partners is one of the most important element of an economy but for ideological reasons crypto-currencies enthusiasts believe that should instead be delegated to a protocol. I think it's a fundamental mistake.
- unclebucknasty 5y ago
  This. Sure, in the micro, maybe crypto helps Russian citizens protect assets during a difficult period, but so can gold. And, in the macro, these fiat levers are much more punitive to the regime and the elites that support it. Not to mention crypto can help the wealthy targets skirt sanctions. On balance, given that we are dealing with a war of aggression and loss of life, I'm grateful for these tools. And, even to the extent it causes some pain for the Russian people, that further erodes support for the regime's unjust campaign and turns up the heat on them.
  - kordlessagain 5y ago
    I just read that Russia is the 5th largest gold holder in the world.
    - dgellow 5y ago
      Yes, they spent the past ~10 years preparing for Western sanctions by buying gold and foreign currencies. They were warned by western countries before 2014 and took the time to adjust their strategy. IMHO the most interesting change they did is to become self-sufficient regarding their food production, and even net exporter of wheat, corn, and other cereals. They correctly identified that was a risk and made necessary changes to reduce it to the point where they can leverage their position against other actors.
- jfroma 5y ago
  True, but I would argue that oppressive facist regimes pretty much exists because they can print their money to rip off common and working people. I am sure that if you ask russians if they are willing to give away their hard earned money to buy tanks in order to support a crazy dictator they probably will answer no.
- kordlessagain 5y ago
  > He is using nuclear threats to satisfy his own ego. I think its more likely Putin is having to deal with a complex internal financial crisis which could affect Russian national stability. Putin may have something personal to gain from this, but there are bigger problems afoot if Russia descends into chaos. Something, mostly likely financial in nature, has happened to trigger the invasion into Ukraine. Raw access to resources? So, whether a small portion of economic value is locked up on chain (or not) is unlikely to be relevant at this point. > Trust between trade partners is one of the most important element of an economy but for ideological reasons crypto-currencies enthusiasts believe that should instead be delegated to a protocol. Trust (assets) shared between trade partners which is not on-chain can be more easily manipulated as needed in a perceived crisis. We can see the US backed sanctions against Russia's interest are not being applied to Russian fuel exports, but instead target the wealth holder's stored assets. That implies a desire for control over the decision making process itself. Cryptocurrency based assets would be more resistant to being influenced in this way and would limit the ability to manipulate the wealth holders, but only if their assets were on-chain. I don't see how cryptocurrency changes this much, given the trust in raw assets relies on physical control of the asset, not a protocol that defines (or limits) how the asset is controlled. It is in everyone's best interest this crisis in Russia and adjacent regions is addressed. How it is addressed, philosophically, is the real debate here.
  - dgellow 5y ago
    > Something, mostly likely financial in nature, has happened to trigger the invasion into Ukraine. I think he believe parts of his rhetoric. Of course the majority of what he communicates is posturing and lies but we can see recurrent themes in his speeches and articles. My understanding is that he really sees Ukraine as part of the Great Russia empire he wants to build and saw an opportunity to take action following events in the Western world from the past decade or so: instability in the US before and during Trump, Brexit and other fragmentation of Europe, NATO seen as weak and useless, US switching its focus to Asia instead of Europe, the way US left Afghanistan, rise of US and European isolationism, etc. Regarding the ideology driving the Kremlin you can see those two Wikipedia articles: - the book "Foundations of Geopolitics ": https://en.wikipedia.org/wiki/Foundations_of_Geopolitics https://en.wikipedia.org/wiki/Foundations_of_Geopolitics - its author and "philosopher" Aleksandr Dugin: https://en.wikipedia.org/wiki/Aleksandr_Dugin https://en.wikipedia.org/wiki/Aleksandr_Dugin Those people aren't just cynical crony capitalists who want to make money for themselves. They have a clear fascist view of the world, with an ideal based on a "natural order" of the strong dominating the weak and dreams of a lost glory of the past. They developed a historical, spiritual, and political view of the world that defines their culture as the one that should dominate.
secondcoming 5y ago
Yes, hand over your crypto keys or you may fall out a window.
- aenis 5y ago
  That would not be unusual for Russia, and they'd first threat to throw out your immediate family. In the soviet era, there was a period of political persecution focused on people suspect of having gold or hard currencies. People would be held indefinitely, and subject to harsh torture, until they let go of their assets. Good if you have some, worse if you actually don't. See Aleksander Solzhenitzyn, somewhere near the end of the first volume. And of course, the people torturing were part of the same organization that brought up Vladimir Vladimirovich Putler.
  - xxs 5y ago
    >Vladimir Vladimirovich Using the middle name (unlike finger) is a high praise in Russia, though.
dopamean 5y ago
I’m not so sure. The volatility of crypto makes it really unattractive to me as a place to keep most of my money. Sure that volatility seems pretty tolerable if my national currency plunges 30% overnight but that’s a pretty unusual thing to happen. So I really wonder how crypto is supposed to help regular people who just a few weeks ago thought this war wasn’t going to happen.
- rmbyrro 5y ago
  Would you really argue the Ruble is more stable than Bitcoin?
  - Loughla 5y ago
    >Sure that volatility seems pretty tolerable if my national currency plunges 30% overnight I feel like that addresses the Ruble. >but that’s a pretty unusual thing to happen. Is the larger point. If you can magic 8 ball your country's future with all certainty, then yes, it is a good idea. Otherwise it's just speculative investment with your actual savings?
  - cthalupa 5y ago
    Yes? Just look at a chart of conversion rates between the two to USD over the past 5 years.
- hutrdvnj 5y ago
  Yup, for Bitcoin it's pretty normal and expected to see double-digit changes in either direction.
- jfroma 5y ago
  Easy, use an stablecoin like DAI or MIM you can get also as much as 12% APY. Edit: previously I used the example USDC which you can argue can be controlled by Coinbase.
  - haakon 5y ago
    Earning interest like that requires leaving your money with a custodian, which negates any protection against confiscation.
muhammedbash 5y ago
what happens when the telecomms infrastructure is hit and shuts down? or when there is no power?
- rmbyrro 5y ago
  Traditional currencies are already 99% digital, I don't see a considerable downside to using crypto with regards to this.
  - Duralias 5y ago
    Genuinely curious, what happens if the country instead firewalls/cuts off their internet from the outside world, how does Crypto handle that? Because that is essentially what has happened now with the SWIFT sanctions.
    - rmbyrro 5y ago
      SWIFT is not the only way for banks to communicate. Cutting off internet from outside world is much more drastic measure, highly unlikely to happen for a prolonged period of time. Even if it does happen, you can still use telephone lines to connect. [1] [2] [1] https://www.dw.com/en/european-activists-offer-dial-up-internet-to-get-egypt-back-online/a-14807049 https://www.dw.com/en/european-activists-offer-dial-up-inter... [2] https://www.france24.com/en/20110201-speak-to-tweet-egypt-twitter-google-join-protesters-internet-blackout-mubarak https://www.france24.com/en/20110201-speak-to-tweet-egypt-tw...
  - muhammedbash 5y ago
    The 1% analog is redundancy in traditional currencies. Outside the developed economies a huge chuck of transactions is still done with physical cash. I imagine it would be a lot more convenient to have some hard currency at hand when fleeing a conflict zone. One might need to bribe border guards at some remote location with unreliable (or non-existent) internet connection, to get to safety.
    - 5y ago
mjburgess 5y ago
If you want to propose a non-state currency which can rival state-backed ones, solves problems, etc. please go ahead. crypto ain't it
- rmbyrro 5y ago
  I don't follow. Do you see crypto as state-backed or allied to state-backed currencies?
  - revscat 5y ago
    Neither. Just trash.
    - rmbyrro 5y ago
      OP is in favor of: A) "non-state currency" B) currency that "rival state-backed ones" C) "solves problems" One could argue cryptocurrencies don't solve any problem (good luck convincing Russians and Argentinians, but anyway). But they are "non-state" and they "rival state-backed" currencies.
      - InitialLastName 5y ago
        Cryptocurrencies are absolutely a "non-state" and "rival state-backed" asset class, but I'd say it's mostly arguable, given the instability, illiquidity, and general inability (in most places) to exchange crypto for goods and services, whether they are "currencies".
nemacol 5y ago
Seems to me like putting my money in to metal and burying it in my yar... an undisclosed location... would still be better than crypto.
- jcbrand 5y ago
  Not if you needed to flee.
rmbyrro 5y ago
We also have to consider they don't need to keep everything in crypto. Just use it to get out of the Ruble and later figure out what to do.
- tomc1985 5y ago
  Whilst hoping that their savings don't get further devalued by extreme price volatility. In the last month I have watched my crypto holdings fluctuate by something like 50%. There is no way in hell I would use crypto as a store of value for anything I cared about under those conditions.
  - rmbyrro 5y ago
    If you want to peg your wealth to the USD, use a stable coin pegged to it. That's what Russians seem to be doing right now. What you are saying would be similar to: there's no way I would use the financial system, look how the futures exchange is volatile! Just keep it in cash, then, but you don't have to ditch the entire system because parts of it are volatile.
    - tomc1985 5y ago
      Does the futures market swing 50%? Sure the smart ones use a stablecoin. But what about everyone else?
zzzeek 5y ago
if such a fantasy situation were true, it would mean world governments would have vastly less leverage to pressure Russia to end their attack, greatly increasing the chance of a longer and possibly more widely-involved war, and in the more general sense making such countries much more comfortable for war mongering despots to flourish (for some awful definition of "flourish"). The Russian financial situation is a feature, not a bug, of a regulated financial system.
- tomp 5y ago
  The financial system is controlled by the US, so it's just another weapon for the US to wield. Countries that want to remain sovereign (independent of the US) like China and Russia would do well to avoid it, and create an alternative system.
tomc1985 5y ago
Yeah how's that working out for El Salvador?
throwaway6734 5y ago
The US & EU are attacking the ruble now. We have yet to see them attack crypto. There's no reason to believe that it can handle the kind of pressure the ruble is facing.

Maybe the cryptocurrency sceptics on HN who live in stable western countries without any fear of their savings disappearing overnight can now understand why it is a valuable invention.

dgellow 5y ago

I would say the exact opposite. So much pressure can be applied against an oppressive fascist regime thanks to the fact that the world is still using fiat. Russia cannot be trusted as a trade partner when Putin, just one guy alone, decides to put at risk more than 25% of worldwide wheat export just to satisfy his personal dream of a lost past glory. He is using nuclear threats to satisfy his own ego. That type of insane behaviour should be completely inacceptable in a global economy and has to be exponentially expensive to do if we want stable peace. Trust between trade partners is one of the most important element of an economy but for ideological reasons crypto-currencies enthusiasts believe that should instead be delegated to a protocol. I think it's a fundamental mistake.

unclebucknasty 5y ago
This. Sure, in the micro, maybe crypto helps Russian citizens protect assets during a difficult period, but so can gold. And, in the macro, these fiat levers are much more punitive to the regime and the elites that support it. Not to mention crypto can help the wealthy targets skirt sanctions. On balance, given that we are dealing with a war of aggression and loss of life, I'm grateful for these tools. And, even to the extent it causes some pain for the Russian people, that further erodes support for the regime's unjust campaign and turns up the heat on them.
- kordlessagain 5y ago
  I just read that Russia is the 5th largest gold holder in the world.
  - dgellow 5y ago
    Yes, they spent the past ~10 years preparing for Western sanctions by buying gold and foreign currencies. They were warned by western countries before 2014 and took the time to adjust their strategy. IMHO the most interesting change they did is to become self-sufficient regarding their food production, and even net exporter of wheat, corn, and other cereals. They correctly identified that was a risk and made necessary changes to reduce it to the point where they can leverage their position against other actors.
jfroma 5y ago
True, but I would argue that oppressive facist regimes pretty much exists because they can print their money to rip off common and working people. I am sure that if you ask russians if they are willing to give away their hard earned money to buy tanks in order to support a crazy dictator they probably will answer no.
kordlessagain 5y ago
> He is using nuclear threats to satisfy his own ego. I think its more likely Putin is having to deal with a complex internal financial crisis which could affect Russian national stability. Putin may have something personal to gain from this, but there are bigger problems afoot if Russia descends into chaos. Something, mostly likely financial in nature, has happened to trigger the invasion into Ukraine. Raw access to resources? So, whether a small portion of economic value is locked up on chain (or not) is unlikely to be relevant at this point. > Trust between trade partners is one of the most important element of an economy but for ideological reasons crypto-currencies enthusiasts believe that should instead be delegated to a protocol. Trust (assets) shared between trade partners which is not on-chain can be more easily manipulated as needed in a perceived crisis. We can see the US backed sanctions against Russia's interest are not being applied to Russian fuel exports, but instead target the wealth holder's stored assets. That implies a desire for control over the decision making process itself. Cryptocurrency based assets would be more resistant to being influenced in this way and would limit the ability to manipulate the wealth holders, but only if their assets were on-chain. I don't see how cryptocurrency changes this much, given the trust in raw assets relies on physical control of the asset, not a protocol that defines (or limits) how the asset is controlled. It is in everyone's best interest this crisis in Russia and adjacent regions is addressed. How it is addressed, philosophically, is the real debate here.
- dgellow 5y ago
  > Something, mostly likely financial in nature, has happened to trigger the invasion into Ukraine. I think he believe parts of his rhetoric. Of course the majority of what he communicates is posturing and lies but we can see recurrent themes in his speeches and articles. My understanding is that he really sees Ukraine as part of the Great Russia empire he wants to build and saw an opportunity to take action following events in the Western world from the past decade or so: instability in the US before and during Trump, Brexit and other fragmentation of Europe, NATO seen as weak and useless, US switching its focus to Asia instead of Europe, the way US left Afghanistan, rise of US and European isolationism, etc. Regarding the ideology driving the Kremlin you can see those two Wikipedia articles: - the book "Foundations of Geopolitics ": https://en.wikipedia.org/wiki/Foundations_of_Geopolitics https://en.wikipedia.org/wiki/Foundations_of_Geopolitics - its author and "philosopher" Aleksandr Dugin: https://en.wikipedia.org/wiki/Aleksandr_Dugin https://en.wikipedia.org/wiki/Aleksandr_Dugin Those people aren't just cynical crony capitalists who want to make money for themselves. They have a clear fascist view of the world, with an ideal based on a "natural order" of the strong dominating the weak and dreams of a lost glory of the past. They developed a historical, spiritual, and political view of the world that defines their culture as the one that should dominate.

secondcoming 5y ago

Yes, hand over your crypto keys or you may fall out a window.

aenis 5y ago
That would not be unusual for Russia, and they'd first threat to throw out your immediate family. In the soviet era, there was a period of political persecution focused on people suspect of having gold or hard currencies. People would be held indefinitely, and subject to harsh torture, until they let go of their assets. Good if you have some, worse if you actually don't. See Aleksander Solzhenitzyn, somewhere near the end of the first volume. And of course, the people torturing were part of the same organization that brought up Vladimir Vladimirovich Putler.
- xxs 5y ago
  >Vladimir Vladimirovich Using the middle name (unlike finger) is a high praise in Russia, though.

dopamean 5y ago

I’m not so sure. The volatility of crypto makes it really unattractive to me as a place to keep most of my money. Sure that volatility seems pretty tolerable if my national currency plunges 30% overnight but that’s a pretty unusual thing to happen. So I really wonder how crypto is supposed to help regular people who just a few weeks ago thought this war wasn’t going to happen.

rmbyrro 5y ago
Would you really argue the Ruble is more stable than Bitcoin?
- Loughla 5y ago
  >Sure that volatility seems pretty tolerable if my national currency plunges 30% overnight I feel like that addresses the Ruble. >but that’s a pretty unusual thing to happen. Is the larger point. If you can magic 8 ball your country's future with all certainty, then yes, it is a good idea. Otherwise it's just speculative investment with your actual savings?
- cthalupa 5y ago
  Yes? Just look at a chart of conversion rates between the two to USD over the past 5 years.
hutrdvnj 5y ago
Yup, for Bitcoin it's pretty normal and expected to see double-digit changes in either direction.
jfroma 5y ago
Easy, use an stablecoin like DAI or MIM you can get also as much as 12% APY. Edit: previously I used the example USDC which you can argue can be controlled by Coinbase.
- haakon 5y ago
  Earning interest like that requires leaving your money with a custodian, which negates any protection against confiscation.

muhammedbash 5y ago

what happens when the telecomms infrastructure is hit and shuts down? or when there is no power?

rmbyrro 5y ago
Traditional currencies are already 99% digital, I don't see a considerable downside to using crypto with regards to this.
- Duralias 5y ago
  Genuinely curious, what happens if the country instead firewalls/cuts off their internet from the outside world, how does Crypto handle that? Because that is essentially what has happened now with the SWIFT sanctions.
  - rmbyrro 5y ago
    SWIFT is not the only way for banks to communicate. Cutting off internet from outside world is much more drastic measure, highly unlikely to happen for a prolonged period of time. Even if it does happen, you can still use telephone lines to connect. [1] [2] [1] https://www.dw.com/en/european-activists-offer-dial-up-internet-to-get-egypt-back-online/a-14807049 https://www.dw.com/en/european-activists-offer-dial-up-inter... [2] https://www.france24.com/en/20110201-speak-to-tweet-egypt-twitter-google-join-protesters-internet-blackout-mubarak https://www.france24.com/en/20110201-speak-to-tweet-egypt-tw...
- muhammedbash 5y ago
  The 1% analog is redundancy in traditional currencies. Outside the developed economies a huge chuck of transactions is still done with physical cash. I imagine it would be a lot more convenient to have some hard currency at hand when fleeing a conflict zone. One might need to bribe border guards at some remote location with unreliable (or non-existent) internet connection, to get to safety.
  - 5y ago

mjburgess 5y ago

If you want to propose a non-state currency which can rival state-backed ones, solves problems, etc. please go ahead. crypto ain't it

rmbyrro 5y ago
I don't follow. Do you see crypto as state-backed or allied to state-backed currencies?
- revscat 5y ago
  Neither. Just trash.
  - rmbyrro 5y ago
    OP is in favor of: A) "non-state currency" B) currency that "rival state-backed ones" C) "solves problems" One could argue cryptocurrencies don't solve any problem (good luck convincing Russians and Argentinians, but anyway). But they are "non-state" and they "rival state-backed" currencies.
    - InitialLastName 5y ago
      Cryptocurrencies are absolutely a "non-state" and "rival state-backed" asset class, but I'd say it's mostly arguable, given the instability, illiquidity, and general inability (in most places) to exchange crypto for goods and services, whether they are "currencies".

nemacol 5y ago

Seems to me like putting my money in to metal and burying it in my yar... an undisclosed location... would still be better than crypto.

jcbrand 5y ago
Not if you needed to flee.

rmbyrro 5y ago

We also have to consider they don't need to keep everything in crypto. Just use it to get out of the Ruble and later figure out what to do.

tomc1985 5y ago
Whilst hoping that their savings don't get further devalued by extreme price volatility. In the last month I have watched my crypto holdings fluctuate by something like 50%. There is no way in hell I would use crypto as a store of value for anything I cared about under those conditions.
- rmbyrro 5y ago
  If you want to peg your wealth to the USD, use a stable coin pegged to it. That's what Russians seem to be doing right now. What you are saying would be similar to: there's no way I would use the financial system, look how the futures exchange is volatile! Just keep it in cash, then, but you don't have to ditch the entire system because parts of it are volatile.
  - tomc1985 5y ago
    Does the futures market swing 50%? Sure the smart ones use a stablecoin. But what about everyone else?

zzzeek 5y ago

if such a fantasy situation were true, it would mean world governments would have vastly less leverage to pressure Russia to end their attack, greatly increasing the chance of a longer and possibly more widely-involved war, and in the more general sense making such countries much more comfortable for war mongering despots to flourish (for some awful definition of "flourish"). The Russian financial situation is a feature, not a bug, of a regulated financial system.

tomp 5y ago
The financial system is controlled by the US, so it's just another weapon for the US to wield. Countries that want to remain sovereign (independent of the US) like China and Russia would do well to avoid it, and create an alternative system.

tomc1985 5y ago

Yeah how's that working out for El Salvador?

throwaway6734 5y ago

The US & EU are attacking the ruble now. We have yet to see them attack crypto. There's no reason to believe that it can handle the kind of pressure the ruble is facing.