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> and it seems one by one the promises of crypto of the last several years are evaporating Promises of crypto have nothing to do with some random US-based cen

> and it seems one by one the promises of crypto of the last several years are evaporating Promises of crypto have nothing to do with some random US-based centralized entity. Not your keys, not your coins.

jollybean 4y ago
They aren't random, and they're not doing this for random reasons. They're an industry leading exchange acting rationally at least from some perspective. Which means there are at least some practical reasons why 'real people' and 'addresses' etc. might be useful in financial transactions.
- Shatnerz 4y ago
  > might be useful in financial transactions This is likely to satisfy regulators. I highly doubt that this change has anything to do with practical usefulness
  - jollybean 4y ago
    ? Hmm ... and why might 'regulations' be in place such that when large sums of money change hands, there's some way to know who's involved, or at least to attribute the transaction to some legal entity ?
    - Shatnerz 4y ago
      We can turn this to a semantic argument over the meaning of "practical usefulness", but in my opinion collecting such information provides no additional benefit to Coinbase other than keeping regulators at bay and avoiding future fines and restrictions. > why might 'regulations' be in place such that when large sums of money change hands I have done some work in the financial compliance space. You would be surprised how small some of these "large sums" are and they keep getting smaller even while inflation weakens the value of the currency involved. In some locations, the limit is as low as ~$1000 USD. Yes the motivation is anti-terrorism, protect the children, national security etc... but in practice it is just a vehicle for governments to collect data on its people. In this case, good actors will behave the same while their data is collected and shared. Bad actors who are aware of these restrictions can just pay the $0.25 to transfer through a newly created wallet and then send without these restrictions while regulators pat themselves on the back for stopping money laundering. What can end up happening with policies like this? Well if governments, regulators, or monopolies get out of hand all of a sudden you cannot send money to a political party. Maybe all your bank accounts are frozen for supporting a protest or all of a sudden you have no way to purchase a flight to leave. Maybe Mastercard/Visa ban donations to entities like Wikileaks for "moral reasons" while allowing donations to the KKK and other similar organizations. These changes don't typically happen all at once. Freedoms are salami sliced away at a rate that doesn't upset the majority and the norm slowly moves to believe that these restrictions are for our own good. (sorry I went a bit off topic here) Also, why was "regulations" in quotes? Sorry if I missed something or misinterpreted your tone here. Hopefully I answered your question.
      - jollybean 4y ago
        It's not 'semantics', it's the opposite of 'semantics'. It's not mostly 'terrorism and protect the children' - it's tax evasion, wire fraud, bribery, insider trading, financial fraud, scams etc. Without fairly consistent regulations up and down the financial spectrum, civil society basically would not exist. We mostly derive our protections from 'government overreach' via the constitution, not anonymity.
        Shatnerz 4y ago
        > It's not 'semantics', it's the opposite of 'semantics'. Is there an opposite of "semantics"? Isn't semantics just the topic around the meaning of words and communication? Is the opposite just everything else? Anyways the point was that Coinbase is likely acting not because it extends the "practical usefulness" of their products, i.e. it adds no new features or functionality. They are likely acting out of regulatory necessity. The semantic argument is whether regulatory necessity falls under "practical usefulness". I'd argue no, as the usefulness of their product as it applies to users either doesn't change or actually goes down as a result of this, but one can similarly argue that not satisfying regulators likely results in the loss of the product altogether. > It's not mostly 'terrorism and protect the children' - it's tax evasion, wire fraud, bribery, insider trading, financial fraud, scams etc. Can you elaborate on this a bit? Collecting beneficiary data is useful for things like redundant checks against sanction lists such as OFAC (terrorism, organized crime, and human trafficking falls under here). I don't see how tax evasion, insider trading, and bribery even apply here. - Tax evasion would likely deal with the exchange reporting both trades and received funds for a user, neither of which applies to beneficiary data on outgoing funds afaik - How is insider trading relevant here? Would that not be dependent on trading and not the transferring of assets. Does providing beneficiary data do anything to shed light on trading with privileged data? - Bribery? Maybe, but seeing as this still happens fairly regularly with traditional finance, I doubt that this will curb much behavior. > We mostly derive our protections from 'government overreach' via the constitution, not anonymity. I assume you are talking about the US constitution which doesn't much apply to non-US persons. The US Constitution doesn't provide much context or protection around the financial system either. In Section 8 we have > "Congress shall have Power [...] to coin Money, regulate the Value thereof, and of foreign Coin." And in Section 10, > "no state [...] shall make any Thing but gold and silver Coin a Tender in Payment of Debts."
- jokethrowaway 4y ago
  These are just the application of normal anti money laundering regulations which are useful only to regulators. I don't care if someone is not paying taxes, good for them if they can avoid having the government steal their profits and stay out of jail. I don't even care if they're doing something the government deems illegal, especially if it's a victimless crime. Regardless, I'd rather have the victims pursue the offenders through legal means (which, in a world without a government with monopoly on violence, will likely take the shape of multiple competing protection agencies) and victimless crimes not to be considered crimes at all. I agree for some transactions you may want to exchange data and legal jurisdictions or setup a contract so that goods / services (+ future support) and money are exchanged safely and without scams - but that's irrespective from the means of payment.
  - CoastalCoder 4y ago
    > I don't care if someone is not paying taxes, good for them if they can avoid having the government steal their profits and stay out of jail. Out of curiosity, what percentage of the population could skip paying taxes before you would care? Are you okay with the government having no funds whatsoever?
    - arlcode 4y ago
      And: Would they be ok with their government having no funds but other governments being still funded by taxes. Publicly funded armies replaced hired mercenary forces for a reason.
    - michaelscott 4y ago
      This is heavily dependent, probably even correlated, with the way the government currently uses taxes. For developed nations this is a no-brainer, of course they need the taxes to supply services to the population. For developing nations? I know a few countries were the government having little to no funding would make very little material difference to daily life, since they already steal so much public funding that private services have long since filled the gap. In this case the percentage for caring about tax payment is zero, or close to it
randomsearch 4y ago
Aye, in theory, but in practice technology has to fit into social context and coinbase is the result you get. If you don’t like the result, you need to redesign the technology so it works within the real world that exists. And it don’t.
- mudrockbestgirl 4y ago
  There is nothing wrong with Coinbase. It's an easy-to-use onramp and offramp, which is a valuable service. But people need to realize that Coinbase has nothing to do with the promise of crypto. You can trade crypto assets without ever using Coinbase or any other centralized exchange. Lots of people do that. Once you use Coinbase, you are out of the self-custodial crypto ecosystem and you pay a price for it. You give up all control over your assets. In return you gain convenience and the security of something backed by the US government. For some people that tradeoff is worth it, for other it isn't. The point of crypto is that you have the option to not do that. Nobody ever forces you to use centralized exchanges.
  - graeme 4y ago
    > the security of something backed by the US government. What do you mean? If Coinbase goes bust or steals your assets you’re just an unsecured creditor. It isn’t like a brokerage in regulated markets or a bank, which have specific rules protecting your money.
    - mudrockbestgirl 4y ago
      Crypto assets may not be FDIC insured, but Coinbase can't just steal and run away with your assets without facing legal ramifications in the U.S. And that would also mean founders/shareholders face consequences (look at Theranos). Of course they can still go bankrupt. But then, again, the U.S. courts would decide what happens to their assets and yours. In either case it's up to the U.S. legal system, i.e. government. That's very different from managing your own keys. Nobody can take anything from you. But you also have zero legal protection against an attacker stealing your keys. In other words, you are in full control, for better or worse.
rvz 4y ago
Exactly. This is why the Kraken CEO [0] recently told its customers to take their coins off of their exchange and put it your own wallet. Brian Armstrong (Coinbase CEO) also said the same thing on Twitter: [1]. [0] https://twitter.com/jespow/status/1494462097161220104 https://twitter.com/jespow/status/1494462097161220104 [1] https://twitter.com/brian_armstrong/status/1493453425010298882 https://twitter.com/brian_armstrong/status/14934534250102988...
- InsomniacL 4y ago
  > This is why the Kraken CEO recently told its customers [those who are worried about it] to take their coins off of their exchange and put it your own wallet.
ssss11 4y ago
Boom! There it is
jacquesm 4y ago
This article only applies to Dutch coinbase users.
- ada1981 4y ago
  Aren’t we all Dutch in spirit? Also not as sensational if you tell people that.
kareemsabri 4y ago
Promises of crypto has a lot to do with how crypto as a system actually manifests in the real world with real people. If I say "promises of email have nothing to do with a random, US-based centralized entity like GMail. Not your server, not your emails." that would be a very silly thing to say.
- npguy 4y ago
  Well, that might not be a very silly thing to say.
  - kareemsabri 4y ago
    I figured it was obvious, given 1.5B people use GMail so it's probably the largest receiver of email in the world. So even if "email is open" if there's a closed system on the receiving end of your message it doesn't do you much good. Maybe it's not obvious though, and we're just talking theoretical techno-utopias.
    - onethought 4y ago
      I think this is a false dichotomy. Gmail is popular, does not undermine the “openness of email”. Both statements are true, and people can and do run their own mail servers, or choose other more trusted providers. It’s a good analogy to crypto actually. Google scanning all your emails does not undermine the promise of email, just as coinbase forcing addresses doesn’t undermine the promise of crypto.
      - kareemsabri 4y ago
        Gmail absolutely undermines the openness of email. That's fine, it's a choice users made because they don't want to run their own email servers, so they offload it to Google. Google decides what to classify as spam. As such, if I stand up a new email server and start sending email to Gmail addresses, I am at the whims of Google deciding what email from me gets delivered. The protocol is open and designed to be decentralized, but the system as implemented in the real world is fairly centralized at this point. Saying "you can run your own mail server" doesn't matter if virtually nobody actually does. If the end state of crypto will just be a bunch of web2 style companies running centralized servers that (maybe) interact with blockchains, and we say "that doesn't undermine the promise of crypto, you can run your own node", I guess I'll have to agree to disagree.
CPLX 4y ago
The promise of crypto is that if you buy some you’ll end up making money on the deal. If you think there’s some other reason all those billions of dollars got poured into it you’re delusional.
bhargav 4y ago
It does have something to do with US entities. If the goal was anonymity, this move shows that it’s possible for it to be taken away by local entities. Imagine if all countries and localities did this. Also: re your comment below a reply, yeah sure you don’t need Coinbase to trade crypto. coin ase is complying with local regulations, others will have to follow. So again, the original comment from OP around promises of Crypto is still accurate
- dylkil 4y ago
  > If the goal was anonymity its a public ledger, the goal wasnt anonymity, it was autonomy
  - Eddy_Viscosity2 4y ago
    that's moving the goalposts. It was about anonymity too.
    - strofcon 4y ago
      Just a nit - it was about pseudonymity, not anonymity. Still worthless tech, but in the interest of fairness. :-D
    - ntoskrnl 4y ago
      Bitcoin's original design was a public ledger with all transactions publicly visible. That has never changed since the beginning.
      - Eddy_Viscosity2 4y ago
        True, but a not insignificant part of the pitch was also pseudonymity (rephrased from anonymity from strofcon's comment).
bdcravens 4y ago
Those entities (US-based and international) are what gives Bitcoin its value in fiat. Otherwise Bitcoin would still be denominated in thousands of Bitcoin per pizza.
- lm28469 4y ago
  I thought bitcoin value was decoupled from fiat though ? Where are all the "I believe in the project" people these days ? looks like they only believe in it when they're in the green

jollybean 4y ago

They aren't random, and they're not doing this for random reasons. They're an industry leading exchange acting rationally at least from some perspective. Which means there are at least some practical reasons why 'real people' and 'addresses' etc. might be useful in financial transactions.

Shatnerz 4y ago
> might be useful in financial transactions This is likely to satisfy regulators. I highly doubt that this change has anything to do with practical usefulness
- jollybean 4y ago
  ? Hmm ... and why might 'regulations' be in place such that when large sums of money change hands, there's some way to know who's involved, or at least to attribute the transaction to some legal entity ?
  - Shatnerz 4y ago
    We can turn this to a semantic argument over the meaning of "practical usefulness", but in my opinion collecting such information provides no additional benefit to Coinbase other than keeping regulators at bay and avoiding future fines and restrictions. > why might 'regulations' be in place such that when large sums of money change hands I have done some work in the financial compliance space. You would be surprised how small some of these "large sums" are and they keep getting smaller even while inflation weakens the value of the currency involved. In some locations, the limit is as low as ~$1000 USD. Yes the motivation is anti-terrorism, protect the children, national security etc... but in practice it is just a vehicle for governments to collect data on its people. In this case, good actors will behave the same while their data is collected and shared. Bad actors who are aware of these restrictions can just pay the $0.25 to transfer through a newly created wallet and then send without these restrictions while regulators pat themselves on the back for stopping money laundering. What can end up happening with policies like this? Well if governments, regulators, or monopolies get out of hand all of a sudden you cannot send money to a political party. Maybe all your bank accounts are frozen for supporting a protest or all of a sudden you have no way to purchase a flight to leave. Maybe Mastercard/Visa ban donations to entities like Wikileaks for "moral reasons" while allowing donations to the KKK and other similar organizations. These changes don't typically happen all at once. Freedoms are salami sliced away at a rate that doesn't upset the majority and the norm slowly moves to believe that these restrictions are for our own good. (sorry I went a bit off topic here) Also, why was "regulations" in quotes? Sorry if I missed something or misinterpreted your tone here. Hopefully I answered your question.
    - jollybean 4y ago
      It's not 'semantics', it's the opposite of 'semantics'. It's not mostly 'terrorism and protect the children' - it's tax evasion, wire fraud, bribery, insider trading, financial fraud, scams etc. Without fairly consistent regulations up and down the financial spectrum, civil society basically would not exist. We mostly derive our protections from 'government overreach' via the constitution, not anonymity.
      - Shatnerz 4y ago
        > It's not 'semantics', it's the opposite of 'semantics'. Is there an opposite of "semantics"? Isn't semantics just the topic around the meaning of words and communication? Is the opposite just everything else? Anyways the point was that Coinbase is likely acting not because it extends the "practical usefulness" of their products, i.e. it adds no new features or functionality. They are likely acting out of regulatory necessity. The semantic argument is whether regulatory necessity falls under "practical usefulness". I'd argue no, as the usefulness of their product as it applies to users either doesn't change or actually goes down as a result of this, but one can similarly argue that not satisfying regulators likely results in the loss of the product altogether. > It's not mostly 'terrorism and protect the children' - it's tax evasion, wire fraud, bribery, insider trading, financial fraud, scams etc. Can you elaborate on this a bit? Collecting beneficiary data is useful for things like redundant checks against sanction lists such as OFAC (terrorism, organized crime, and human trafficking falls under here). I don't see how tax evasion, insider trading, and bribery even apply here. - Tax evasion would likely deal with the exchange reporting both trades and received funds for a user, neither of which applies to beneficiary data on outgoing funds afaik - How is insider trading relevant here? Would that not be dependent on trading and not the transferring of assets. Does providing beneficiary data do anything to shed light on trading with privileged data? - Bribery? Maybe, but seeing as this still happens fairly regularly with traditional finance, I doubt that this will curb much behavior. > We mostly derive our protections from 'government overreach' via the constitution, not anonymity. I assume you are talking about the US constitution which doesn't much apply to non-US persons. The US Constitution doesn't provide much context or protection around the financial system either. In Section 8 we have > "Congress shall have Power [...] to coin Money, regulate the Value thereof, and of foreign Coin." And in Section 10, > "no state [...] shall make any Thing but gold and silver Coin a Tender in Payment of Debts."
jokethrowaway 4y ago
These are just the application of normal anti money laundering regulations which are useful only to regulators. I don't care if someone is not paying taxes, good for them if they can avoid having the government steal their profits and stay out of jail. I don't even care if they're doing something the government deems illegal, especially if it's a victimless crime. Regardless, I'd rather have the victims pursue the offenders through legal means (which, in a world without a government with monopoly on violence, will likely take the shape of multiple competing protection agencies) and victimless crimes not to be considered crimes at all. I agree for some transactions you may want to exchange data and legal jurisdictions or setup a contract so that goods / services (+ future support) and money are exchanged safely and without scams - but that's irrespective from the means of payment.
- CoastalCoder 4y ago
  > I don't care if someone is not paying taxes, good for them if they can avoid having the government steal their profits and stay out of jail. Out of curiosity, what percentage of the population could skip paying taxes before you would care? Are you okay with the government having no funds whatsoever?
  - arlcode 4y ago
    And: Would they be ok with their government having no funds but other governments being still funded by taxes. Publicly funded armies replaced hired mercenary forces for a reason.
  - michaelscott 4y ago
    This is heavily dependent, probably even correlated, with the way the government currently uses taxes. For developed nations this is a no-brainer, of course they need the taxes to supply services to the population. For developing nations? I know a few countries were the government having little to no funding would make very little material difference to daily life, since they already steal so much public funding that private services have long since filled the gap. In this case the percentage for caring about tax payment is zero, or close to it

randomsearch 4y ago

Aye, in theory, but in practice technology has to fit into social context and coinbase is the result you get. If you don’t like the result, you need to redesign the technology so it works within the real world that exists. And it don’t.

mudrockbestgirl 4y ago
There is nothing wrong with Coinbase. It's an easy-to-use onramp and offramp, which is a valuable service. But people need to realize that Coinbase has nothing to do with the promise of crypto. You can trade crypto assets without ever using Coinbase or any other centralized exchange. Lots of people do that. Once you use Coinbase, you are out of the self-custodial crypto ecosystem and you pay a price for it. You give up all control over your assets. In return you gain convenience and the security of something backed by the US government. For some people that tradeoff is worth it, for other it isn't. The point of crypto is that you have the option to not do that. Nobody ever forces you to use centralized exchanges.
- graeme 4y ago
  > the security of something backed by the US government. What do you mean? If Coinbase goes bust or steals your assets you’re just an unsecured creditor. It isn’t like a brokerage in regulated markets or a bank, which have specific rules protecting your money.
  - mudrockbestgirl 4y ago
    Crypto assets may not be FDIC insured, but Coinbase can't just steal and run away with your assets without facing legal ramifications in the U.S. And that would also mean founders/shareholders face consequences (look at Theranos). Of course they can still go bankrupt. But then, again, the U.S. courts would decide what happens to their assets and yours. In either case it's up to the U.S. legal system, i.e. government. That's very different from managing your own keys. Nobody can take anything from you. But you also have zero legal protection against an attacker stealing your keys. In other words, you are in full control, for better or worse.

rvz 4y ago

Exactly. This is why the Kraken CEO [0] recently told its customers to take their coins off of their exchange and put it your own wallet. Brian Armstrong (Coinbase CEO) also said the same thing on Twitter: [1]. [0] https://twitter.com/jespow/status/1494462097161220104 https://twitter.com/jespow/status/1494462097161220104 [1] https://twitter.com/brian_armstrong/status/1493453425010298882 https://twitter.com/brian_armstrong/status/14934534250102988...

InsomniacL 4y ago
> This is why the Kraken CEO recently told its customers [those who are worried about it] to take their coins off of their exchange and put it your own wallet.

ssss11 4y ago

Boom! There it is

jacquesm 4y ago

This article only applies to Dutch coinbase users.

ada1981 4y ago
Aren’t we all Dutch in spirit? Also not as sensational if you tell people that.

kareemsabri 4y ago

Promises of crypto has a lot to do with how crypto as a system actually manifests in the real world with real people. If I say "promises of email have nothing to do with a random, US-based centralized entity like GMail. Not your server, not your emails." that would be a very silly thing to say.

npguy 4y ago
Well, that might not be a very silly thing to say.
- kareemsabri 4y ago
  I figured it was obvious, given 1.5B people use GMail so it's probably the largest receiver of email in the world. So even if "email is open" if there's a closed system on the receiving end of your message it doesn't do you much good. Maybe it's not obvious though, and we're just talking theoretical techno-utopias.
  - onethought 4y ago
    I think this is a false dichotomy. Gmail is popular, does not undermine the “openness of email”. Both statements are true, and people can and do run their own mail servers, or choose other more trusted providers. It’s a good analogy to crypto actually. Google scanning all your emails does not undermine the promise of email, just as coinbase forcing addresses doesn’t undermine the promise of crypto.
    - kareemsabri 4y ago
      Gmail absolutely undermines the openness of email. That's fine, it's a choice users made because they don't want to run their own email servers, so they offload it to Google. Google decides what to classify as spam. As such, if I stand up a new email server and start sending email to Gmail addresses, I am at the whims of Google deciding what email from me gets delivered. The protocol is open and designed to be decentralized, but the system as implemented in the real world is fairly centralized at this point. Saying "you can run your own mail server" doesn't matter if virtually nobody actually does. If the end state of crypto will just be a bunch of web2 style companies running centralized servers that (maybe) interact with blockchains, and we say "that doesn't undermine the promise of crypto, you can run your own node", I guess I'll have to agree to disagree.

CPLX 4y ago

The promise of crypto is that if you buy some you’ll end up making money on the deal. If you think there’s some other reason all those billions of dollars got poured into it you’re delusional.

bhargav 4y ago

It does have something to do with US entities. If the goal was anonymity, this move shows that it’s possible for it to be taken away by local entities. Imagine if all countries and localities did this. Also: re your comment below a reply, yeah sure you don’t need Coinbase to trade crypto. coin ase is complying with local regulations, others will have to follow. So again, the original comment from OP around promises of Crypto is still accurate

dylkil 4y ago
> If the goal was anonymity its a public ledger, the goal wasnt anonymity, it was autonomy
- Eddy_Viscosity2 4y ago
  that's moving the goalposts. It was about anonymity too.
  - strofcon 4y ago
    Just a nit - it was about pseudonymity, not anonymity. Still worthless tech, but in the interest of fairness. :-D
  - ntoskrnl 4y ago
    Bitcoin's original design was a public ledger with all transactions publicly visible. That has never changed since the beginning.
    - Eddy_Viscosity2 4y ago
      True, but a not insignificant part of the pitch was also pseudonymity (rephrased from anonymity from strofcon's comment).

bdcravens 4y ago

Those entities (US-based and international) are what gives Bitcoin its value in fiat. Otherwise Bitcoin would still be denominated in thousands of Bitcoin per pizza.

lm28469 4y ago
I thought bitcoin value was decoupled from fiat though ? Where are all the "I believe in the project" people these days ? looks like they only believe in it when they're in the green