4 ms·

Seems like wishful thinking to me. Unless crypto becomes actually useful for real world transactions, it has to be converted to fiat currency for use, and all

by deet 5y ago

Seems like wishful thinking to me. Unless crypto becomes actually useful for real world transactions, it has to be converted to fiat currency for use, and all the exchanges or technologies that do that conversion are subject to the will of governments. There was literally a post on HN today in which a government proposed to curtail crypto transactions for entities it considers hostile: https://www.coindesk.com/policy/2022/03/17/senator-elizabeth-warren-announces-sanctions-compliance-bill-for-crypto-companies/ https://www.coindesk.com/policy/2022/03/17/senator-elizabeth... Recently another government seized crypto assets from those it considered adversaries: https://www.coindesk.com/policy/2022/02/16/canada-sanctions-34-crypto-wallets-tied-to-trucker-freedom-convoy/ https://www.coindesk.com/policy/2022/02/16/canada-sanctions-... And those are just actions taken by relatively benign governments that use regulation to accomplish their goals instead of force. It's tough to think that government-level actors couldn't just disrupt the crypto networks directly if they so desired, either through cyber attacks (ie denial of service or exploiting vulnerabilities that almost certainly exist in the crypto networks). Or in extreme cases even just taking control of network infrastructure directly. Or shutting off the internet. And no, Starlink will not save crypto users against adversaries who can jam EM communications. Governments are powerful and to think that crypto or anything in the internet space is resistant to that power in the most extreme situations is not wise.

juanci_to 5y ago
I agree with everything you said except a couple of things. >Unless crypto becomes actually useful for real world transactions, it has to be converted to fiat currency for use, and all the exchanges or technologies that do that conversion are subject to the will of governments. This is true, except that in some places governments are too inefficient to even control those things. The IT people works for them for pennies, and got there because they are the cousin of some politician. They are also not very capable, otherwise they would work for someone who paid them better and on time. I'm using my country as an example, where people trade them for money in fintech wallets and not banks, since they are more difficult to control despite also having a KYC process. >Governments are powerful and to think that crypto or anything in the internet space is resistant to that power in the most extreme situations is not wise. Other decentralized technologies simpler than cryptocurrencies prove this to be wrong. And I'm talking about torrents and some other kinds of P2P networks. Those things are used mostly for piratery, they make companies lose money, so there's an incentive for governments to take them down, yet they fail to do so. On the other hand, crypto is seen as an investment by people who actually own a lot of money. Investors from big banks sometimes have at least a very, very small portion of their portfolios on it because it would be dumb to not take that risk for just a small amount of money they can afford to lose. So a government might not be that much focused into taking it down since a lot of "important" folks of the business industry are on it too The only thing I think the US government might be truly worried about are the so-called stablecoins. Having an alternative to the USD is risky for their monetary control, since the supply can be artificially expanded with cryptos like UST which is a decentralized stablecoin, instead of centralized and backed by real dollars
- gotaquestion 5y ago
  Crypto should never be an investment. That is one of its primary flaws. Currency is not an investment. Yes, people trade currency, but for very small margins and as a hedge. When a currency swings 10,000x as crypto has done, it typically only happens in countries whose economies are going belly-up, see: Zibabwe. If crypto is an investment, that means it is fluctuating dramatically, and if it is fluctuating dramatically, it isn't a currency (or it is a currency of a failed economy). Don't believe me? Then I would expect you to be investing in stablecoins. If you only invest in Bitcoin and Ether and not stablecoins, then you are playing the stock market, because stablecoins are kept stable the same way countries can float their currenct to avoid wild swings in valuation. I believe crypto will have a use in the future, but only with stablecoins, similar to commercial paper. As it is today, it is a scam for gambling and illegal activity, and a few people who want penalize their impoverished foreign relatives by sending them tokens that might be worth much less the day after they are sent (the cost of sending >US$10,000 is peanuts compared to the loss of value due to BTC/ETH fluctuations).
  - juanci_to 5y ago
    >Crypto should never be an investment. That is one of its primary flaws. Yes, that's unintentional, but it is an investment anyway. Yes, it's also a gamble, like any other kind of investment. Every investment has its risks. This is a very, very risky one. >Don't believe me? Then I would expect you to be investing in stablecoins. If you only invest in Bitcoin and Ether and not stablecoins, then you are playing the stock market, because stablecoins are kept stable the same way countries can float their currenct to avoid wild swings in valuation. Of course I believe you, I'm an argentine. In my country people is forbidden to buy other currencies. They "can", but they are limited to 200 USD every month (minus the consumption they spend by paying Netflix and Spotify with credit cards) and it's taxed. And I'm not taking into account a lot more rules. So it's mostly obligatory to use our local currency that loses 50% of its value every year. We even have a black market for the dollar. It's sold for twice more from what the government says it's worth. When you Google for our currency, that's just the official value. valordolarblue.com.ar shows you the real value for a dollar in pesos, that's how much it's sold for in the streets. The official value only exists for paying us programmers and other exporters half of what we earn when we work for foreign companies (and that's before the 50% of taxes), as we are obligated to convert all our money to argentine pesos. The situation is even worse for farmers, they pay them like 60 pesos per dollar. So yes, people in my country use crypto mostly for the USD stablecoins. It made the life of a lot of people better too, as the best "investment" here is saving dollars. >I believe crypto will have a use in the future, but only with stablecoins, similar to commercial paper. As it is today, it is a scam for gambling and illegal activity, and a few people who want penalize their impoverished foreign relatives by sending them tokens that might be worth much less the day after they are sent (the cost of sending >US$10,000 is peanuts compared to the loss of value due to BTC/ETH fluctuations). I do so too, but I don't think that the investing / gambling side will disappear. Like it or not. But I also think that tying the value to the US Dollar or any other currency is disappointing and a bad idea, as it's keeping itself to being marketed as such and, as I said, causes a competition against the Fed. And the disappointing part is that crypto shouldn't strive to be just a dollar or an euro. Having an stablecoin without pegging it to another specific currency would be ideal.
lambdasquirrel 5y ago
And even if so (that it can be converted to the fiat currency of your choice), does it have the liquidity to make it useful at national-scale economies? Putin has been finding that it doesn't.

by deet 5y ago

juanci_to 5y ago

I agree with everything you said except a couple of things. >Unless crypto becomes actually useful for real world transactions, it has to be converted to fiat currency for use, and all the exchanges or technologies that do that conversion are subject to the will of governments. This is true, except that in some places governments are too inefficient to even control those things. The IT people works for them for pennies, and got there because they are the cousin of some politician. They are also not very capable, otherwise they would work for someone who paid them better and on time. I'm using my country as an example, where people trade them for money in fintech wallets and not banks, since they are more difficult to control despite also having a KYC process. >Governments are powerful and to think that crypto or anything in the internet space is resistant to that power in the most extreme situations is not wise. Other decentralized technologies simpler than cryptocurrencies prove this to be wrong. And I'm talking about torrents and some other kinds of P2P networks. Those things are used mostly for piratery, they make companies lose money, so there's an incentive for governments to take them down, yet they fail to do so. On the other hand, crypto is seen as an investment by people who actually own a lot of money. Investors from big banks sometimes have at least a very, very small portion of their portfolios on it because it would be dumb to not take that risk for just a small amount of money they can afford to lose. So a government might not be that much focused into taking it down since a lot of "important" folks of the business industry are on it too The only thing I think the US government might be truly worried about are the so-called stablecoins. Having an alternative to the USD is risky for their monetary control, since the supply can be artificially expanded with cryptos like UST which is a decentralized stablecoin, instead of centralized and backed by real dollars

gotaquestion 5y ago
Crypto should never be an investment. That is one of its primary flaws. Currency is not an investment. Yes, people trade currency, but for very small margins and as a hedge. When a currency swings 10,000x as crypto has done, it typically only happens in countries whose economies are going belly-up, see: Zibabwe. If crypto is an investment, that means it is fluctuating dramatically, and if it is fluctuating dramatically, it isn't a currency (or it is a currency of a failed economy). Don't believe me? Then I would expect you to be investing in stablecoins. If you only invest in Bitcoin and Ether and not stablecoins, then you are playing the stock market, because stablecoins are kept stable the same way countries can float their currenct to avoid wild swings in valuation. I believe crypto will have a use in the future, but only with stablecoins, similar to commercial paper. As it is today, it is a scam for gambling and illegal activity, and a few people who want penalize their impoverished foreign relatives by sending them tokens that might be worth much less the day after they are sent (the cost of sending >US$10,000 is peanuts compared to the loss of value due to BTC/ETH fluctuations).
- juanci_to 5y ago
  >Crypto should never be an investment. That is one of its primary flaws. Yes, that's unintentional, but it is an investment anyway. Yes, it's also a gamble, like any other kind of investment. Every investment has its risks. This is a very, very risky one. >Don't believe me? Then I would expect you to be investing in stablecoins. If you only invest in Bitcoin and Ether and not stablecoins, then you are playing the stock market, because stablecoins are kept stable the same way countries can float their currenct to avoid wild swings in valuation. Of course I believe you, I'm an argentine. In my country people is forbidden to buy other currencies. They "can", but they are limited to 200 USD every month (minus the consumption they spend by paying Netflix and Spotify with credit cards) and it's taxed. And I'm not taking into account a lot more rules. So it's mostly obligatory to use our local currency that loses 50% of its value every year. We even have a black market for the dollar. It's sold for twice more from what the government says it's worth. When you Google for our currency, that's just the official value. valordolarblue.com.ar shows you the real value for a dollar in pesos, that's how much it's sold for in the streets. The official value only exists for paying us programmers and other exporters half of what we earn when we work for foreign companies (and that's before the 50% of taxes), as we are obligated to convert all our money to argentine pesos. The situation is even worse for farmers, they pay them like 60 pesos per dollar. So yes, people in my country use crypto mostly for the USD stablecoins. It made the life of a lot of people better too, as the best "investment" here is saving dollars. >I believe crypto will have a use in the future, but only with stablecoins, similar to commercial paper. As it is today, it is a scam for gambling and illegal activity, and a few people who want penalize their impoverished foreign relatives by sending them tokens that might be worth much less the day after they are sent (the cost of sending >US$10,000 is peanuts compared to the loss of value due to BTC/ETH fluctuations). I do so too, but I don't think that the investing / gambling side will disappear. Like it or not. But I also think that tying the value to the US Dollar or any other currency is disappointing and a bad idea, as it's keeping itself to being marketed as such and, as I said, causes a competition against the Fed. And the disappointing part is that crypto shouldn't strive to be just a dollar or an euro. Having an stablecoin without pegging it to another specific currency would be ideal.

lambdasquirrel 5y ago

And even if so (that it can be converted to the fiat currency of your choice), does it have the liquidity to make it useful at national-scale economies? Putin has been finding that it doesn't.