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I mean it has good use cases they're not just the ones that scheme promoters want to be true. I know TFA pokes some holes in the censorship resistance attribute

I mean it has good use cases they're not just the ones that scheme promoters want to be true. I know TFA pokes some holes in the censorship resistance attribute of bitcoin but i think everyone can agree it does provide value transfer solution that is much harder to block than Visa/Stripe/etc. 1). Silk Road or dark net markets in general. Can't be done with Visa or other existing solutions at any kind of scale 2). Funding of political dissidents. Wikileaks, canadian truckers, etc. These people got blocked by traditional payment providers but still received crypto. (there are still other obstacles for dissidents but at least this solves 1) 3). Money laundering. Find someone who sells bitcoin miners, buy them with dirty money and use them to mine bitcoin sent to fresh address not tied to your other activity. 4). Uniswap and maybe flash loans in defi seems like new things I haven't seen in tradfi or elsewhere. Maybe some cool promise here I'm sure they're others. But I think the key common thread is that all of them require censorship resistance. If what you're doing isn't likely to be censored by authorities then you're being incredibly wasteful by using blockchain

jmyeet 4y ago
So illegal stuff. Ok. While there might be cases you consider moral or ethical even though they’re illegal I’m not sure I’d consider this a net positive or any reason to think crypto will enjoy mass adoption.
- timcavel 4y ago
- ForrestN 4y ago
  Yes. It's not a compelling argument that something can be used well for crimes. If cryptocurrency is just John Wick tokens, it not only isn't useful to most people, but further it's anti-useful to society in general and will likely be suppressed. It's also hard for me to understand these "payment outside of X authority system" ideas when the value shifts so wildly and so unpredictably. No one wants to get paid, not even criminals, in a currency that might be worth 20% less tomorrow, depending on what's going on with Matt Damon's Super Bowl ad for the criminal currency or whatever.
- snapcaster 4y ago
  Right, doing illegal stuff is the killer app is my point. I don't know if it's a net positive either, but it's a positive for some users. I hope it's clear I wasn't advocating for any of these things just pointing to successful applications of the technology
librish 4y ago
The problem with 1-3 is that they only work because regulators haven't tried very hard to stop them. If you require crypto exchanges to verify that funds in accounts are not coming from these types of sources before allowing you to take fiat out you've now vastly reduced their usefulness to the degree that only sophisticated criminal participants have any chance of actually getting usable money out of their schemes.
onlyrealcuzzo 4y ago
Proof of Stake seems like it could have a lot of interesting use cases. I'm imagining you want to run a server in which you want to prove a given open-source version of the code is processing the inputs, and the outputs are available for anyone to observe, verify, & store. I imagine there's some ways to do this already, though. Proof of Stake just seems like a protocol that isn't too wasteful and inefficient and could make for a decent standard.
staticassertion 4y ago
Agreed, there are use cases, even obvious use cases. Blockchain provides guarantees that other databases do not. They're just guarantees that assume that some portion of people connecting to it are bad actors. Most people don't really care about solving that problem because they just don't give those people access, but that implies a single authority for access ie: centralization. So blockchain only makes sense when: a) You have bad actors b) You need decentralization The use cases for that are, for the most part, "subvert government authority". There are some cool other things you can do, like web of trust stuff, but the vast majority of the market is in the "subvert government authority" in one way or another, or is an outright scam.
- 8note 4y ago
  a) isn't quite specific enough You use blockchain if you have one very specific type of bad actor, and know for sure that they won't try bad things
- jjoonathan 4y ago
  I don't think this is so crazy of an idea. Many of our institutions (example: democracy, checks and balances) are designed to "subvert government authority" in exactly the same spirit. The idea is to ensure that some rules are followed regardless of who is in charge.
- whywhywhywhy 4y ago
  Try to fly with over $10,000 (Not even a lot of money these days) in cash and see what happens. Might change your opinion of it.
  - staticassertion 4y ago
    What opinion? You just demonstrated an example of subverting government authority, which is exactly what I said it can be useful for. I didn't make any judgment about doing so.
    - whywhywhywhy 4y ago
colesantiago 4y ago
Crypto doesn't even pass the grocery test.
amanj41 4y ago
it's a little disingenuous not to put remittance on this list as it's one of the few legitimate and not morally dubious ones. I have gotten screwed on exchange fees and wire fees remitting and using crypto is much easier.
- wmf 4y ago
  You're in a very small minority. https://www.saveonsend.com/bitcoin-blockchain-money-transfer/ https://www.saveonsend.com/bitcoin-blockchain-money-transfer...
  - amanj41 4y ago
    don't have time to read the article so I'll take your word for it, but I will note that upon skimming it seems to really look at bitcoin a lot. Bitcoin might be one of the worst cryptocurrencies to remit. I will concede international transfers is not a very large use case, and definitely doesn't justify the market capitalization of the blockchain base currencies FWIW
- rahimnathwani 4y ago
  Most people receiving remittances need fiat money. For amounts under ~$500, cryptocurrency off-ramps are often less convenient and more expensive than an international cash-to-cash remittance with Western Union or Moneygram.
  - amanj41 4y ago
    I have no problem with properly regulated stablecoins (and hoping they come about soon). Blockchains are only necessary for one thing and that is cryptocurrency. Doesn't matter if that currency happens to be a digital representation of EUR or USD or whatever. If you think they're more expensive to use than centralized providers, you're probably using ethereum or bitcoin. I can send USDC on Algorand in any quantity for less than a cent
    - rahimnathwani 4y ago
game-of-throws 4y ago
My theory is that the likelihood someone understands the use cases is inversely correlated to their trust in government. For example: https://www.bbc.com/news/business-60912789 https://www.bbc.com/news/business-60912789 These articles all follow a common pattern. 1. The trigger – Inflation/distrust in government/bank withdrawal restrictions/paypal freezes your funds/country is at war/etc 2. The response – People gravitate towards a system that is resilient to whatever failure mode they experienced Those who haven't personally experienced #1 (such as world superpowers, the wealthy/"elite") seem not to be able to grasp the benefits. Meanwhile in places that are smaller/less stable/not economically self-sufficient/on the fringe, people are increasingly turning to it as the best alternative.
- xadhominemx 4y ago
  You still have no answer for the crypto on/off ramp issue.
  - ragnot 4y ago
    I think the idea would be that in a scenario where crypto becomes a currency, there wouldn't need to be an off-ramp (at least immediately, think war/revolution). You would trade the crypto like "real" money.
    - toomuchtodo 4y ago
      This requires price stability, which is at odds with the use of crypto as a speculative investment vehicle. People use fiat to transact because it is stable. It’s stable because a central bank is using tools available to bring about stability.
      - T0Bi 4y ago
        There are decentralized stable coins such as Dai that survived massive crashes/volatility in the past and still remained on peg. Crypto ≠ Bitcoin.
frgtpsswrdlame 4y ago
I think there's a conflict here though: >If what you're doing isn't likely to be censored by authorities then you're being incredibly wasteful by using blockchain If the wasteful people doing non-crime activities on the blockchain weren't there it'd be incredibly easy for the authorities to crack down. In other words, if the only legitimate use cases of crypto is facilitating crime, it can only even achieve that goal as long as many people are using crypto for the other stuff you think is wasteful.
- NhanH 4y ago
  There is a gradient of “being censored”, and not all of it involved being illegal. In Vietnam, the government does capital control by limiting what bank can do with my money (I can’t request them to send 20k to the US unless I have an approved list of reasons). However, it is not illegal for me to send the money abroad, providing I can do it legally myself. So bitcoin is useful to me
- snapcaster 4y ago
  This is true. "Virtuous liquidity" is the term I've heard used. The same thing is true of Tor right? if the _only_ people using it are bad the usage itself is what gets criminalized. The speculators on crypto likely provide a lot of this
rndgermandude 4y ago
Re:3) If I remember correctly a lot of the "support scammers" also use crypto for laundering. Since getting straight into bank accounts and actually doing transfers often fails - even with the "help" of the victim - another way for them to get their money is having the victim buy gift cards, and then they'll sell on the scammed gift cards (at a loss, of course) for crypto and then cash that out. You also forget 5) Outright scams, like rugpulls or boiler room-style scams.
jayd16 4y ago
Three of these are just money laundering and then the 4th is "and maybe some cool ideas." I really don't see how the money laundering is a long term niche. They'll get regulated eventually. I do think the whole event has dredged up some interesting ideas and desires that were being ignored, but of lot of those "cool promise here" ideas could probably work without a blockchain.
- toolz 4y ago
  Let's take a modern example of the canadian truckers. How would you get money to them when Canada was able to get US companies to block their funding with fiat? Use a different company and hope another few million doesn't get locked up? That seems like the only alternative and I'm not sure many people would think that's a viable alternative.
  - jayd16 4y ago
    Again, I'm not sure "temporarily skirt the law" is all that viable long term.
    - toolz 4y ago
      Personally I hope it is and I don't see how it couldn't be. Bitcoin is uncensorable as far as I can tell. Countries have not proven themselves capable of stopping internet traffic and thus countries have shown they do not have the power to censor bitcoin transactions. I am sure countries will want to censor it, but I don't believe they will be able to, as such the only risk to bitcoins long term viability is the markets demand. There are numerous examples of illicit goods that governments have proven incapable of reducing the demand for, e.g. drugs. So I don't think bitcoin is going anywhere. I think bitcoin will take a different censorable form and we'll start seeing companies on top of the blockchain that can do things like refund unauthorized transactions and things of that nature, but the base layer will remain uncensorable and thus bitcoin could become both convenient enough (although not better, in my opinion) for rich countries to use as currency while holding the characteristic of providing tremendous benefits to citizens in oppressed poor countries.
TheBlight 4y ago
Calling it a scheme seems a bit rough. It's a market mostly unencumbered by regulation (not true of on/offramps), online 24x7 and not directly controlled by governments -- an entirely new asset class with unique properties. It allows for new business/cause funding models. Anyone can participate regardless of "credit rating" or ideology and no one needs a custodian.
- cuteboy19 4y ago
  The reason you don't need a credit rating is because you need collateral. Want a $5000 loan from crypto? Better have at least $20000 in crypto assets. How anyone is expected to get credit funding from this strange system is unclear. Also the no custodian part is especially strange considering that most people who have crypto keep it on some exchangebank
  - Ekaros 4y ago
    The whole crypto lending to me seems like having a cake and eating it too. Which surprisingly kinda works for a while. Have crypto and let it appreciate, but at the same time use it to gamble for even more appreciation...
  - notahacker 4y ago
    > Want a $5000 loan from crypto? Better have at least $20000 in crypto assets. Yup. That's potentially useful for speculators to earn expected gains from one cryptocurrency whilst also trading with another one. But it's utterly useless for the common cases to borrow money (i.e. you don't have enough of it to buy what you need to buy)
bhouston 4y ago
5) Running various investment scams such as Ponzis, and pump-and-dumps (AKA rug pulls) in an anonymous fashion. There is a lot of money to made doing this right now...
silentsea90 4y ago
The biggest use case for Bitcoin is of it being an escape from arbitrary printing of money by central banks. The richer your home country, the further you are from intuitively grasping how catastrophic printing is in the long run.
- dybber 4y ago
  Why is it catastrophic then? Isn’t it exactly this property that allows us to have a more or less stable currency?
  - silentsea90 4y ago
    Stable against what? TVs? Food? Healthcare? Education? Real estate? https://static.seekingalpha.com/uploads/2017/5/29/saupload_inflation10-16.jpg https://static.seekingalpha.com/uploads/2017/5/29/saupload_i...
- aNoob7000 4y ago
  The problem with Bitcoin is that it is a pain to transact any business with it.
  - silentsea90 4y ago
    I agree but please expand on the pain so I can respond.
- WalterSear 4y ago
  Bitcoin's price is primarily driven by market manipulation fueled by arbitrary Tether-tron printing. Tether-tron is used entirely internally by a criminal syndicate in order to create fraudulent chinese 'cookie cutter' exchanges, in a manner similar to casino chips - ie - "Here's $100 million for your new exchange, that you can only use to buy crypto within 'the family', incidentally pumping up their prices along the way'". This is in addition to the arbitrary Tether-eth printing that you ought to be well aware of.
- Aunche 4y ago
discordianfish 4y ago
It's useful for illegal stuff so far. But if it's the only real use case, governments can and will just outlaw exchange into fiat. Beside that, you still need to trust the developers. Sure, you can not partake in a fork but so you can decide to not do business with certain corporations or governments.
treeman79 4y ago
Apparently Lego sets are used for money laundering. Since they hold value well. https://nosafebets.com/2020/06/05/legos-the-new-gold-standard-for-drugs/amp/ https://nosafebets.com/2020/06/05/legos-the-new-gold-standar...
NikolaNovak 4y ago
>>These people got blocked by traditional payment providers but still received crypto. I thought their crypto payments were tracked (open ledger) and basically nixxed? I.e. this was the grand counter-example of crypto use case :-< We can discuss our personal opinion on the Canadian protests of Winter of 2022, but I strongly believe that for average citizen, Crypto payments leave a HUGE exposure / attack surface. YES, there's going to be a Hacker News person who can figure out how to safely transfer crypto, and maybe even do something practical with it, in duress situations; but I feel that would end up complex enough to be achievable effectively with other crypto-less, equal-complexity methods. Meanwhile, average citizen's ability to safely and anonymously and SAFELY use crypto under duress is extremely limited. https://www.vice.com/en/article/jgmnpd/the-freedom-convoy-bitcoin-donations-have-been-frozen-and-seized https://www.vice.com/en/article/jgmnpd/the-freedom-convoy-bi...
- zen_1 4y ago
  That's not a trait of crypto in general, just bitcoin (and ETH, and most other non privacy-focused coins). Take a look at Monero or ZCash to see how untraceable the trucker convoy (or similar) donations would have been if they had just used a different cryptocurrency.
- SwanRonson 4y ago
  Personal opinions aside it is a valid use case. They can track the wallet and they will, but they cannot close/lock the wallet as they did bank accounts. As you’ve implied there are methods to achieve anonymity but they require technical knowledge. If this becomes a commonly understood use case it will likely become easier for the average person.
  - NikolaNovak 4y ago
    I believe in this case they did close/lock the wallet, as it was held by the exchange. How far they go to recoup money that did make it to individuals is up to the attorney general and courts and politicians to decide - but critically, means are extremely there. It is empathically and trivially known who the recipients are. This is the part that feels like we are intentionally ignoring - eventually crypto intersects with the real world. There were technically superior and more anonymous ways to do that kind of particular transaction of course. But we may differ as to what "average person" is and what their technical competence will be in the near to medium future. I believe average person still has tremendous phishing and scam risk with a regular, regulated, fairly static, designed for ease of use, documented, go-to-branch-and-we'll-guide-you-through-it electronic banking. I am skeptical of our ability to create a safe path for the average person through the dynamic, unregulated, ever-changing, technically complex, myriad-clients-and-zillion-methods-and-gazillion-exchanges all chock-full of scammers world of crypto.
snarf21 4y ago
I used to think there were use cases but not anymore. Currency is the only possible one but since it is digital, it leads to the same but different centralization. The days of mining bitcoin in the background and "winning" a full bitcoin are gone. There is no need for crypto for money laundering when it can be done at scale at Deutsche Bank. The anonymous use cases are a chicken/egg problem because you still need on/off ramps. but the other issues make global crypto currency a no go.
seydor 4y ago
i'd start with "porn and nudity". The financial system is extremely hostile to them
ParksNet 4y ago
5) Stalking horse for CBDCs.
tablespoon 4y ago
> I'm sure they're others. But I think the key common thread is that all of them require censorship resistance. If what you're doing isn't likely to be censored by authorities then you're being incredibly wasteful by using blockchain I don't think "censorship resistance" is the correct term. I think what you're really describing is "law enforcement resistance" (e.g. your activities are illegal). And even in those cases, unless cryptocurrency is circulating as actual currency in the economy (which it isn't), most of the law-enforcement resistance is fatally compromised by the need for onramps and offramps.
galdosdi 4y ago
The problem is the only situations where crypto is more effective than the alternative (a well operated SQL database owned by a bank headquartered in a geopolitically secure jurisdiction with stable courts) is a really shitty one: when you live in a Mad Max world with no stable rule of law. In other words, it just so happens that the exact situations where crypto is useful, are the same situations where it is very hard for capitalists to earn a good return on their capital. Unstable places or illegal markets. It's not that the existence of crypto doesn't make sense. It's that investing in it makes no sense, because it will only be successful in scenarios where "investing in things" at all is a lost cause.
deleted 4y ago
[deleted]
lern_too_spel 4y ago
The article directly addresses this. These use cases vanish as soon as the government regulates the onramps and offramps.
zem 4y ago
the #1 use case by far is as a pyramidal pump-and-dump scheme. it may not be what anyone considers a legitimate/palatable use case, but it is objectively what cryptocurrencies are being enthusiastically used for, and they work well for the purpose. the people who got in early have typically gotten rich off it, and the people who have not either play the (necessary) role of the sucker, or catch on and try to start their own coin where they are in at the start.

jmyeet 4y ago

So illegal stuff. Ok. While there might be cases you consider moral or ethical even though they’re illegal I’m not sure I’d consider this a net positive or any reason to think crypto will enjoy mass adoption.

timcavel 4y ago
ForrestN 4y ago
Yes. It's not a compelling argument that something can be used well for crimes. If cryptocurrency is just John Wick tokens, it not only isn't useful to most people, but further it's anti-useful to society in general and will likely be suppressed. It's also hard for me to understand these "payment outside of X authority system" ideas when the value shifts so wildly and so unpredictably. No one wants to get paid, not even criminals, in a currency that might be worth 20% less tomorrow, depending on what's going on with Matt Damon's Super Bowl ad for the criminal currency or whatever.
snapcaster 4y ago
Right, doing illegal stuff is the killer app is my point. I don't know if it's a net positive either, but it's a positive for some users. I hope it's clear I wasn't advocating for any of these things just pointing to successful applications of the technology

librish 4y ago

The problem with 1-3 is that they only work because regulators haven't tried very hard to stop them. If you require crypto exchanges to verify that funds in accounts are not coming from these types of sources before allowing you to take fiat out you've now vastly reduced their usefulness to the degree that only sophisticated criminal participants have any chance of actually getting usable money out of their schemes.

onlyrealcuzzo 4y ago

Proof of Stake seems like it could have a lot of interesting use cases. I'm imagining you want to run a server in which you want to prove a given open-source version of the code is processing the inputs, and the outputs are available for anyone to observe, verify, & store. I imagine there's some ways to do this already, though. Proof of Stake just seems like a protocol that isn't too wasteful and inefficient and could make for a decent standard.

staticassertion 4y ago

Agreed, there are use cases, even obvious use cases. Blockchain provides guarantees that other databases do not. They're just guarantees that assume that some portion of people connecting to it are bad actors. Most people don't really care about solving that problem because they just don't give those people access, but that implies a single authority for access ie: centralization. So blockchain only makes sense when: a) You have bad actors b) You need decentralization The use cases for that are, for the most part, "subvert government authority". There are some cool other things you can do, like web of trust stuff, but the vast majority of the market is in the "subvert government authority" in one way or another, or is an outright scam.

8note 4y ago
a) isn't quite specific enough You use blockchain if you have one very specific type of bad actor, and know for sure that they won't try bad things
jjoonathan 4y ago
I don't think this is so crazy of an idea. Many of our institutions (example: democracy, checks and balances) are designed to "subvert government authority" in exactly the same spirit. The idea is to ensure that some rules are followed regardless of who is in charge.
whywhywhywhy 4y ago
Try to fly with over $10,000 (Not even a lot of money these days) in cash and see what happens. Might change your opinion of it.
- staticassertion 4y ago
  What opinion? You just demonstrated an example of subverting government authority, which is exactly what I said it can be useful for. I didn't make any judgment about doing so.
  - whywhywhywhy 4y ago

colesantiago 4y ago

Crypto doesn't even pass the grocery test.

amanj41 4y ago

it's a little disingenuous not to put remittance on this list as it's one of the few legitimate and not morally dubious ones. I have gotten screwed on exchange fees and wire fees remitting and using crypto is much easier.

wmf 4y ago
You're in a very small minority. https://www.saveonsend.com/bitcoin-blockchain-money-transfer/ https://www.saveonsend.com/bitcoin-blockchain-money-transfer...
- amanj41 4y ago
  don't have time to read the article so I'll take your word for it, but I will note that upon skimming it seems to really look at bitcoin a lot. Bitcoin might be one of the worst cryptocurrencies to remit. I will concede international transfers is not a very large use case, and definitely doesn't justify the market capitalization of the blockchain base currencies FWIW
rahimnathwani 4y ago
Most people receiving remittances need fiat money. For amounts under ~$500, cryptocurrency off-ramps are often less convenient and more expensive than an international cash-to-cash remittance with Western Union or Moneygram.
- amanj41 4y ago
  I have no problem with properly regulated stablecoins (and hoping they come about soon). Blockchains are only necessary for one thing and that is cryptocurrency. Doesn't matter if that currency happens to be a digital representation of EUR or USD or whatever. If you think they're more expensive to use than centralized providers, you're probably using ethereum or bitcoin. I can send USDC on Algorand in any quantity for less than a cent
  - rahimnathwani 4y ago

game-of-throws 4y ago

My theory is that the likelihood someone understands the use cases is inversely correlated to their trust in government. For example: https://www.bbc.com/news/business-60912789 https://www.bbc.com/news/business-60912789 These articles all follow a common pattern. 1. The trigger – Inflation/distrust in government/bank withdrawal restrictions/paypal freezes your funds/country is at war/etc 2. The response – People gravitate towards a system that is resilient to whatever failure mode they experienced Those who haven't personally experienced #1 (such as world superpowers, the wealthy/"elite") seem not to be able to grasp the benefits. Meanwhile in places that are smaller/less stable/not economically self-sufficient/on the fringe, people are increasingly turning to it as the best alternative.

xadhominemx 4y ago
You still have no answer for the crypto on/off ramp issue.
- ragnot 4y ago
  I think the idea would be that in a scenario where crypto becomes a currency, there wouldn't need to be an off-ramp (at least immediately, think war/revolution). You would trade the crypto like "real" money.
  - toomuchtodo 4y ago
    This requires price stability, which is at odds with the use of crypto as a speculative investment vehicle. People use fiat to transact because it is stable. It’s stable because a central bank is using tools available to bring about stability.
    - T0Bi 4y ago
      There are decentralized stable coins such as Dai that survived massive crashes/volatility in the past and still remained on peg. Crypto ≠ Bitcoin.

frgtpsswrdlame 4y ago

I think there's a conflict here though: >If what you're doing isn't likely to be censored by authorities then you're being incredibly wasteful by using blockchain If the wasteful people doing non-crime activities on the blockchain weren't there it'd be incredibly easy for the authorities to crack down. In other words, if the only legitimate use cases of crypto is facilitating crime, it can only even achieve that goal as long as many people are using crypto for the other stuff you think is wasteful.

NhanH 4y ago
There is a gradient of “being censored”, and not all of it involved being illegal. In Vietnam, the government does capital control by limiting what bank can do with my money (I can’t request them to send 20k to the US unless I have an approved list of reasons). However, it is not illegal for me to send the money abroad, providing I can do it legally myself. So bitcoin is useful to me
snapcaster 4y ago
This is true. "Virtuous liquidity" is the term I've heard used. The same thing is true of Tor right? if the _only_ people using it are bad the usage itself is what gets criminalized. The speculators on crypto likely provide a lot of this

rndgermandude 4y ago

Re:3) If I remember correctly a lot of the "support scammers" also use crypto for laundering. Since getting straight into bank accounts and actually doing transfers often fails - even with the "help" of the victim - another way for them to get their money is having the victim buy gift cards, and then they'll sell on the scammed gift cards (at a loss, of course) for crypto and then cash that out. You also forget 5) Outright scams, like rugpulls or boiler room-style scams.

jayd16 4y ago

Three of these are just money laundering and then the 4th is "and maybe some cool ideas." I really don't see how the money laundering is a long term niche. They'll get regulated eventually. I do think the whole event has dredged up some interesting ideas and desires that were being ignored, but of lot of those "cool promise here" ideas could probably work without a blockchain.

toolz 4y ago
Let's take a modern example of the canadian truckers. How would you get money to them when Canada was able to get US companies to block their funding with fiat? Use a different company and hope another few million doesn't get locked up? That seems like the only alternative and I'm not sure many people would think that's a viable alternative.
- jayd16 4y ago
  Again, I'm not sure "temporarily skirt the law" is all that viable long term.
  - toolz 4y ago
    Personally I hope it is and I don't see how it couldn't be. Bitcoin is uncensorable as far as I can tell. Countries have not proven themselves capable of stopping internet traffic and thus countries have shown they do not have the power to censor bitcoin transactions. I am sure countries will want to censor it, but I don't believe they will be able to, as such the only risk to bitcoins long term viability is the markets demand. There are numerous examples of illicit goods that governments have proven incapable of reducing the demand for, e.g. drugs. So I don't think bitcoin is going anywhere. I think bitcoin will take a different censorable form and we'll start seeing companies on top of the blockchain that can do things like refund unauthorized transactions and things of that nature, but the base layer will remain uncensorable and thus bitcoin could become both convenient enough (although not better, in my opinion) for rich countries to use as currency while holding the characteristic of providing tremendous benefits to citizens in oppressed poor countries.

TheBlight 4y ago

Calling it a scheme seems a bit rough. It's a market mostly unencumbered by regulation (not true of on/offramps), online 24x7 and not directly controlled by governments -- an entirely new asset class with unique properties. It allows for new business/cause funding models. Anyone can participate regardless of "credit rating" or ideology and no one needs a custodian.

cuteboy19 4y ago
The reason you don't need a credit rating is because you need collateral. Want a $5000 loan from crypto? Better have at least $20000 in crypto assets. How anyone is expected to get credit funding from this strange system is unclear. Also the no custodian part is especially strange considering that most people who have crypto keep it on some exchangebank
- Ekaros 4y ago
  The whole crypto lending to me seems like having a cake and eating it too. Which surprisingly kinda works for a while. Have crypto and let it appreciate, but at the same time use it to gamble for even more appreciation...
- notahacker 4y ago
  > Want a $5000 loan from crypto? Better have at least $20000 in crypto assets. Yup. That's potentially useful for speculators to earn expected gains from one cryptocurrency whilst also trading with another one. But it's utterly useless for the common cases to borrow money (i.e. you don't have enough of it to buy what you need to buy)

bhouston 4y ago

5) Running various investment scams such as Ponzis, and pump-and-dumps (AKA rug pulls) in an anonymous fashion. There is a lot of money to made doing this right now...

silentsea90 4y ago

The biggest use case for Bitcoin is of it being an escape from arbitrary printing of money by central banks. The richer your home country, the further you are from intuitively grasping how catastrophic printing is in the long run.

dybber 4y ago
Why is it catastrophic then? Isn’t it exactly this property that allows us to have a more or less stable currency?
- silentsea90 4y ago
  Stable against what? TVs? Food? Healthcare? Education? Real estate? https://static.seekingalpha.com/uploads/2017/5/29/saupload_inflation10-16.jpg https://static.seekingalpha.com/uploads/2017/5/29/saupload_i...
aNoob7000 4y ago
The problem with Bitcoin is that it is a pain to transact any business with it.
- silentsea90 4y ago
  I agree but please expand on the pain so I can respond.
WalterSear 4y ago
Bitcoin's price is primarily driven by market manipulation fueled by arbitrary Tether-tron printing. Tether-tron is used entirely internally by a criminal syndicate in order to create fraudulent chinese 'cookie cutter' exchanges, in a manner similar to casino chips - ie - "Here's $100 million for your new exchange, that you can only use to buy crypto within 'the family', incidentally pumping up their prices along the way'". This is in addition to the arbitrary Tether-eth printing that you ought to be well aware of.
Aunche 4y ago

discordianfish 4y ago

It's useful for illegal stuff so far. But if it's the only real use case, governments can and will just outlaw exchange into fiat. Beside that, you still need to trust the developers. Sure, you can not partake in a fork but so you can decide to not do business with certain corporations or governments.

treeman79 4y ago

Apparently Lego sets are used for money laundering. Since they hold value well. https://nosafebets.com/2020/06/05/legos-the-new-gold-standard-for-drugs/amp/ https://nosafebets.com/2020/06/05/legos-the-new-gold-standar...

NikolaNovak 4y ago

>>These people got blocked by traditional payment providers but still received crypto. I thought their crypto payments were tracked (open ledger) and basically nixxed? I.e. this was the grand counter-example of crypto use case :-< We can discuss our personal opinion on the Canadian protests of Winter of 2022, but I strongly believe that for average citizen, Crypto payments leave a HUGE exposure / attack surface. YES, there's going to be a Hacker News person who can figure out how to safely transfer crypto, and maybe even do something practical with it, in duress situations; but I feel that would end up complex enough to be achievable effectively with other crypto-less, equal-complexity methods. Meanwhile, average citizen's ability to safely and anonymously and SAFELY use crypto under duress is extremely limited. https://www.vice.com/en/article/jgmnpd/the-freedom-convoy-bitcoin-donations-have-been-frozen-and-seized https://www.vice.com/en/article/jgmnpd/the-freedom-convoy-bi...

zen_1 4y ago
That's not a trait of crypto in general, just bitcoin (and ETH, and most other non privacy-focused coins). Take a look at Monero or ZCash to see how untraceable the trucker convoy (or similar) donations would have been if they had just used a different cryptocurrency.
SwanRonson 4y ago
Personal opinions aside it is a valid use case. They can track the wallet and they will, but they cannot close/lock the wallet as they did bank accounts. As you’ve implied there are methods to achieve anonymity but they require technical knowledge. If this becomes a commonly understood use case it will likely become easier for the average person.
- NikolaNovak 4y ago
  I believe in this case they did close/lock the wallet, as it was held by the exchange. How far they go to recoup money that did make it to individuals is up to the attorney general and courts and politicians to decide - but critically, means are extremely there. It is empathically and trivially known who the recipients are. This is the part that feels like we are intentionally ignoring - eventually crypto intersects with the real world. There were technically superior and more anonymous ways to do that kind of particular transaction of course. But we may differ as to what "average person" is and what their technical competence will be in the near to medium future. I believe average person still has tremendous phishing and scam risk with a regular, regulated, fairly static, designed for ease of use, documented, go-to-branch-and-we'll-guide-you-through-it electronic banking. I am skeptical of our ability to create a safe path for the average person through the dynamic, unregulated, ever-changing, technically complex, myriad-clients-and-zillion-methods-and-gazillion-exchanges all chock-full of scammers world of crypto.

snarf21 4y ago

I used to think there were use cases but not anymore. Currency is the only possible one but since it is digital, it leads to the same but different centralization. The days of mining bitcoin in the background and "winning" a full bitcoin are gone. There is no need for crypto for money laundering when it can be done at scale at Deutsche Bank. The anonymous use cases are a chicken/egg problem because you still need on/off ramps. but the other issues make global crypto currency a no go.

seydor 4y ago

i'd start with "porn and nudity". The financial system is extremely hostile to them

ParksNet 4y ago

5) Stalking horse for CBDCs.

tablespoon 4y ago

> I'm sure they're others. But I think the key common thread is that all of them require censorship resistance. If what you're doing isn't likely to be censored by authorities then you're being incredibly wasteful by using blockchain I don't think "censorship resistance" is the correct term. I think what you're really describing is "law enforcement resistance" (e.g. your activities are illegal). And even in those cases, unless cryptocurrency is circulating as actual currency in the economy (which it isn't), most of the law-enforcement resistance is fatally compromised by the need for onramps and offramps.

galdosdi 4y ago

The problem is the only situations where crypto is more effective than the alternative (a well operated SQL database owned by a bank headquartered in a geopolitically secure jurisdiction with stable courts) is a really shitty one: when you live in a Mad Max world with no stable rule of law. In other words, it just so happens that the exact situations where crypto is useful, are the same situations where it is very hard for capitalists to earn a good return on their capital. Unstable places or illegal markets. It's not that the existence of crypto doesn't make sense. It's that investing in it makes no sense, because it will only be successful in scenarios where "investing in things" at all is a lost cause.

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lern_too_spel 4y ago

The article directly addresses this. These use cases vanish as soon as the government regulates the onramps and offramps.

zem 4y ago

the #1 use case by far is as a pyramidal pump-and-dump scheme. it may not be what anyone considers a legitimate/palatable use case, but it is objectively what cryptocurrencies are being enthusiastically used for, and they work well for the purpose. the people who got in early have typically gotten rich off it, and the people who have not either play the (necessary) role of the sucker, or catch on and try to start their own coin where they are in at the start.