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The problem is central banks devaluing currency. It's an esoteric topic to many people, so crypto turned into a blinking pinball machine of tech, but the probl

by realce 3y ago

The problem is central banks devaluing currency. It's an esoteric topic to many people, so crypto turned into a blinking pinball machine of tech, but the problem was always the devaluing of currency by the Fed.

red-iron-pine 3y ago
The point of central banks is to control their monetary policy. Like, that's why they exist. Plus while a bank may devalue its currency, the point of it is to keep it stable -- something we haven't seen from crypto in any meaningful sense. Even the so-called "stable coins" are anything but.
- realce 3y ago
  > The point of central banks is to control their monetary policy. There's plenty of people out there who disagree with central bank's existence and policy. I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process. All currency is an illusion, it's just about which illusion makes you more comfortable. It's all just money, and money isn't entirely rational to begin with.
  - cmh89 3y ago
    >I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process. Something that depreciates can still be stable. The US dollar loses value at a relatively predictable rate. We can see what an unstable currency looks like right now by looking at Argentina, where the peso has lost 47% of its value in a year. BitCoin is more like the peso than the dollar, hence why its called unstable. > All currency is an illusion, it's just about which illusion makes you more comfortable. Currency isn't an illusion, it's a social construct, and its a deeply embedded social construct.
    - deleted 3y ago
      [deleted]
  - Kye 3y ago
    >> "I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process." By that logic, Earth is tilting dangerously out of control and the moon is hurtling off into deep space.
- rybosworld 3y ago
  > The point of central banks is to control their monetary policy. This is exactly the issue that a lot of people have with them. Not to mention that the people in charge of adjusting the value of your life savings aren't even voted in... Cryptocurrency aims to give you complete autonomy over your money. Something 99.99% of people don't currently have.
  - andsoitis 3y ago
    > Cryptocurrency aims to give you complete autonomy over your money. That sounds nice, but it doesn’t come for free. Price volatility, trust issues, etc. to name a few. I think a key issue is that credit, money, wealth, currency, while related, are really different things but for many people all of it is “money”.
    - rybosworld 3y ago
      > Price volatility, trust issues, etc. to name a few. These are not specific to cryptocurrency. The trust issues are primarily a result of crypto scams and not innate to crypto. Just as scams involving dollars, euros etc., have nothing to do with the currency itself. Where crypto shines on the trust aspect is that you don't have some guy in an ivory tower deciding to devalue your crypto by 5%/year. You can choose to buy into inflationary cryptos (doge coin for instance), or you can choose to buy into crypto's with fixed supply. No one can take your share of the supply away from you or change the rules on a whim. That's absolutely huge. "Compound interest is the most powerful force in the universe" - Albert Einstein, supposedly. Central banks use that force against citizens and everyone just accepts it because it's been that way for so long.
  - ako 3y ago
    Maybe you should be happy they’re not voted in, voting is a popularity contest that completely ignores capabilities. I want the people in charge to know what they’re doing.
jstx1 3y ago
As opposed to currency being devalued by the latest scandal in the crypto space? Crypto prices swing wildly based on news, and news can be manipulated by a small number of actors. Just because the transactions are validated in a secure and distributed way doesn't mean that the underlying value is safe.
edgyquant 3y ago
Devaluation is a widely discussed topic with decades of scholarly economic input as to why it helps generate more wealth in the long run. There’s a reason we have target rates etc. Crypto bros just want to replace the 1% not build a better financial system, it’s obvious because they don’t understand the financial system to begin with.
- eniotna 3y ago
  Devaluing money doesn't create wealth, increased in productivity does. Devaluing money in many instances lowers productivity because people have to invest time into protecting the value of their labor instead of making more stuff they are good at. I haven't read a single convincing explanation as to why encouraging consumption somehow generates more wealth on the long run. > There’s a reason we have target rates In an interview Powell admitted no one really knows why the target is 2%. Why is 2% better than 10%, why not 0%? We don't need to encourage consumption with artificial money devaluation, humans already discount the future because of the finiteness of our lives

by realce 3y ago

red-iron-pine 3y ago

The point of central banks is to control their monetary policy. Like, that's why they exist. Plus while a bank may devalue its currency, the point of it is to keep it stable -- something we haven't seen from crypto in any meaningful sense. Even the so-called "stable coins" are anything but.

realce 3y ago
> The point of central banks is to control their monetary policy. There's plenty of people out there who disagree with central bank's existence and policy. I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process. All currency is an illusion, it's just about which illusion makes you more comfortable. It's all just money, and money isn't entirely rational to begin with.
- cmh89 3y ago
  >I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process. Something that depreciates can still be stable. The US dollar loses value at a relatively predictable rate. We can see what an unstable currency looks like right now by looking at Argentina, where the peso has lost 47% of its value in a year. BitCoin is more like the peso than the dollar, hence why its called unstable. > All currency is an illusion, it's just about which illusion makes you more comfortable. Currency isn't an illusion, it's a social construct, and its a deeply embedded social construct.
  - deleted 3y ago
    [deleted]
- Kye 3y ago
  >> "I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process." By that logic, Earth is tilting dangerously out of control and the moon is hurtling off into deep space.
rybosworld 3y ago
> The point of central banks is to control their monetary policy. This is exactly the issue that a lot of people have with them. Not to mention that the people in charge of adjusting the value of your life savings aren't even voted in... Cryptocurrency aims to give you complete autonomy over your money. Something 99.99% of people don't currently have.
- andsoitis 3y ago
  > Cryptocurrency aims to give you complete autonomy over your money. That sounds nice, but it doesn’t come for free. Price volatility, trust issues, etc. to name a few. I think a key issue is that credit, money, wealth, currency, while related, are really different things but for many people all of it is “money”.
  - rybosworld 3y ago
    > Price volatility, trust issues, etc. to name a few. These are not specific to cryptocurrency. The trust issues are primarily a result of crypto scams and not innate to crypto. Just as scams involving dollars, euros etc., have nothing to do with the currency itself. Where crypto shines on the trust aspect is that you don't have some guy in an ivory tower deciding to devalue your crypto by 5%/year. You can choose to buy into inflationary cryptos (doge coin for instance), or you can choose to buy into crypto's with fixed supply. No one can take your share of the supply away from you or change the rules on a whim. That's absolutely huge. "Compound interest is the most powerful force in the universe" - Albert Einstein, supposedly. Central banks use that force against citizens and everyone just accepts it because it's been that way for so long.
- ako 3y ago
  Maybe you should be happy they’re not voted in, voting is a popularity contest that completely ignores capabilities. I want the people in charge to know what they’re doing.

jstx1 3y ago

As opposed to currency being devalued by the latest scandal in the crypto space? Crypto prices swing wildly based on news, and news can be manipulated by a small number of actors. Just because the transactions are validated in a secure and distributed way doesn't mean that the underlying value is safe.

edgyquant 3y ago

Devaluation is a widely discussed topic with decades of scholarly economic input as to why it helps generate more wealth in the long run. There’s a reason we have target rates etc. Crypto bros just want to replace the 1% not build a better financial system, it’s obvious because they don’t understand the financial system to begin with.

eniotna 3y ago
Devaluing money doesn't create wealth, increased in productivity does. Devaluing money in many instances lowers productivity because people have to invest time into protecting the value of their labor instead of making more stuff they are good at. I haven't read a single convincing explanation as to why encouraging consumption somehow generates more wealth on the long run. > There’s a reason we have target rates In an interview Powell admitted no one really knows why the target is 2%. Why is 2% better than 10%, why not 0%? We don't need to encourage consumption with artificial money devaluation, humans already discount the future because of the finiteness of our lives