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There's too much money in the finance industry, creating very strong incentives for the players to resort to shady tactics. A strong government can enforce regu

There's too much money in the finance industry, creating very strong incentives for the players to resort to shady tactics. A strong government can enforce regulations, but given the current political situation in the US that's not very likely. This is pretty much the main reason BitCoin and many other coins were created - remove the corruption and the unfair advantage some actors in the finance industry enjoy. Why do you think that people resorting to crypto is a bad scenario? The US government providing basic bank accounts is never going to pass in Congress - the republicans are going to be against it based on their small government ideas and many democrats are depending on the money from sponsors in the finance industry. The Fed is owned by the banks anyway.

chii 3y ago
> remove the corruption and the unfair advantage some actors in the finance industry enjoy only to put themselves in the very same seat, but without any actual regulatory oversight.
- borissk 3y ago
  How is it the same seat? The creation of new coins is ruled by algorithms, not by well connected people.
  - chii 3y ago
    > ruled by algorithms, not by well connected people. the earlier coiners gets a lot more. Just like today's financial institutions have gotten there by just being around early enough to have captured a lot more. All i see in bitcoin (and etherium) are just people who wish they were those old bankers.
  - pjc50 3y ago
    Anyone can create a new coin and rugpull it. This is not an improvement.
  - UncleMeat 3y ago
    And those algorithms are largely driven by well connected people.
Red_Leaves_Flyy 3y ago
Crypto is a mess of scammers and criminals. There’s occasionally actual uses, like nfts. But we only need to check the nft marketplace to see how that actual use cases has died. Pushing ordinary people into crypto with no recourse for their funds is asinine. Modern societies are built around the fact that goods and services are exchanged for money that will clawed back if the deliverables are unacceptable. Crypto makes it impossible for unilateral or third party refunds.
- borissk 3y ago
  Sure, there are problems with crypto. But the stuff you mentioned has nothing to do with using say BitCoin as virtual gold - as a long term store of value, instead of say a savings account.
  - _heimdall 3y ago
    If bitcoin is only a long term store of value it really needs to be paired with a separate currency for daily transactions. What should we consider using as a checking account if bitcoin is mainly savings?
    - thinkmassive 3y ago
      How about composing a digital currency stack in layers, similar to the OSI model for networking? Bitcoin already has second layers: the Lightning Network, Stacks, and bridges to other blockchain systems.
      - Red_Leaves_Flyy 3y ago
        Ah yes. Solving broken systems with little legitimate use by building ever more complicated solutions.
      - _heimdall 3y ago
        Those second layers seen to lose the benefits behind bitcoin if I'm not mistaken. Most layer solutions act more like PayPal than anything else, with a trusted mediator taking offish transactions in their own system. No more immutable ledger, traceability, fungibility, or censorship protections.
opportune 3y ago
I can envision some future well polished crypto ecosystem being good for banking, but even if it were just Bitcoin (I prefer monero but it wouldn’t work for other reasons), it has some properties that could make collapses or crises spectacularly bad. Fundamentally it’s not that different from wildcat banking which we moved on from because it led to lots of fraud and collapses. Anyway, for just Bitcoin: Bitcoin isn’t ideal for payments still and, speaking personally, I don’t want to ever be in the situation where I have tens of thousands of dollars that could permanently evaporate just because I forgot a code. So in practice I think most people would want custodians to facilitate payments or larger deposits. And it’s still possible for those custodians to make a purely technical fuck up and permanently lose funds in a way that is unrecoverable and irreversible but not possible in the current banking system. Any coin with a fixed supply will be very deflationary which will make lending very difficult. Ever since we made it really hard to build new buildings and decided most early stage businesses are too risky for banks, it kinda seems like this isn’t as bad as it sounds. But, people are gonna want to do it sometimes and it will be hard. And you can’t rely on a basal protocol for a real world lending system because most real world loans can’t be fully/overcollateralized like with crypto (there is only a market for this because of tax avoidance that AFAIU is not even tested in court) and there is a real risk someone will not be able to pay it back, you need an oldschool system for stopping fraud and handling bankruptcies up to and including a guy with a gun taking away your toys. If we’re gonna have custodians and a market for loans, I got bad news for you, some custodians will combine the two and pass on those benefits to consumers. If done with CD-like instruments this won’t change things much, until some bank gets this genius idea: if a lender and lendee make most of their payments within the same bank, you don’t actually need to debit the lender the full loan because most of that money will stay within the bank. And if lender-custodians all partner up they can fully debit all such loans. And then because lenders don’t get their accounts locked up, whether or not their balance is loaned and for how much can be completely abstracted and presented as a shared flat yield across all lenders at the bank… (this is a simplified version of modern banking) Maybe it won’t be exactly like that, but I guarantee you, something banking-like will happen. And eventually a bank will fail because of bad risk management or a bank run. With crypto, it actually is feasible to do a huge bank run of all your money even if it’s millions of dollars, so it’ll be quick and sharp. Anybody who isn’t fast enough loses everything with no Fed to help them, we hit an extremely severe and instant deflationary depression where credit is completely unavailable, and there is no Fed to pass centralized monetary policy measures to fix it. Instead of speedrunning digital Black Friday, I’d rather the Fed just let any individual meeting whatever reserve/audit/whatever requirements use any special facility available to member banks (or remove a facility if it cannot be offered as such). So rather than replace the system due to an unfair advantage, let everybody play by the same rules. If a bank can’t compete with that, they’re not a viable business. As a consumer I can better manage my risk within what is (to me) a very similar system. Ultimately, I want the Fed to be able to buy treasuries (print money) and raise/lower rates to control inflation because I’ve tried to learn as much as I can about banking history, economics, and crypto and this still seems like the most solid way to control inflation and prevent depressions.
_heimdall 3y ago
You could also argue that the main reason bitcoin was adopted by those who bought it was to get in on the ground floor and have the unfair advantage themselves. Bitcoin hasn't solved corruption or unfair advantage, it just moves it out of the hands of the few politicians and bank executives in charge to the few running a handful of mining pools. There are still people pulling the strings that can, and have, changed the rules along the way. Even the magic number of how many bitcoins will ever be produced can be changed, that limit is no more real than the gold standard that was killed with the stroke of a pen.
timcavel 3y ago
[dead]

chii 3y ago

> remove the corruption and the unfair advantage some actors in the finance industry enjoy only to put themselves in the very same seat, but without any actual regulatory oversight.

borissk 3y ago
How is it the same seat? The creation of new coins is ruled by algorithms, not by well connected people.
- chii 3y ago
  > ruled by algorithms, not by well connected people. the earlier coiners gets a lot more. Just like today's financial institutions have gotten there by just being around early enough to have captured a lot more. All i see in bitcoin (and etherium) are just people who wish they were those old bankers.
- pjc50 3y ago
  Anyone can create a new coin and rugpull it. This is not an improvement.
- UncleMeat 3y ago
  And those algorithms are largely driven by well connected people.

Red_Leaves_Flyy 3y ago

Crypto is a mess of scammers and criminals. There’s occasionally actual uses, like nfts. But we only need to check the nft marketplace to see how that actual use cases has died. Pushing ordinary people into crypto with no recourse for their funds is asinine. Modern societies are built around the fact that goods and services are exchanged for money that will clawed back if the deliverables are unacceptable. Crypto makes it impossible for unilateral or third party refunds.

borissk 3y ago
Sure, there are problems with crypto. But the stuff you mentioned has nothing to do with using say BitCoin as virtual gold - as a long term store of value, instead of say a savings account.
- _heimdall 3y ago
  If bitcoin is only a long term store of value it really needs to be paired with a separate currency for daily transactions. What should we consider using as a checking account if bitcoin is mainly savings?
  - thinkmassive 3y ago
    How about composing a digital currency stack in layers, similar to the OSI model for networking? Bitcoin already has second layers: the Lightning Network, Stacks, and bridges to other blockchain systems.
    - Red_Leaves_Flyy 3y ago
      Ah yes. Solving broken systems with little legitimate use by building ever more complicated solutions.
    - _heimdall 3y ago
      Those second layers seen to lose the benefits behind bitcoin if I'm not mistaken. Most layer solutions act more like PayPal than anything else, with a trusted mediator taking offish transactions in their own system. No more immutable ledger, traceability, fungibility, or censorship protections.

opportune 3y ago

I can envision some future well polished crypto ecosystem being good for banking, but even if it were just Bitcoin (I prefer monero but it wouldn’t work for other reasons), it has some properties that could make collapses or crises spectacularly bad. Fundamentally it’s not that different from wildcat banking which we moved on from because it led to lots of fraud and collapses. Anyway, for just Bitcoin: Bitcoin isn’t ideal for payments still and, speaking personally, I don’t want to ever be in the situation where I have tens of thousands of dollars that could permanently evaporate just because I forgot a code. So in practice I think most people would want custodians to facilitate payments or larger deposits. And it’s still possible for those custodians to make a purely technical fuck up and permanently lose funds in a way that is unrecoverable and irreversible but not possible in the current banking system. Any coin with a fixed supply will be very deflationary which will make lending very difficult. Ever since we made it really hard to build new buildings and decided most early stage businesses are too risky for banks, it kinda seems like this isn’t as bad as it sounds. But, people are gonna want to do it sometimes and it will be hard. And you can’t rely on a basal protocol for a real world lending system because most real world loans can’t be fully/overcollateralized like with crypto (there is only a market for this because of tax avoidance that AFAIU is not even tested in court) and there is a real risk someone will not be able to pay it back, you need an oldschool system for stopping fraud and handling bankruptcies up to and including a guy with a gun taking away your toys. If we’re gonna have custodians and a market for loans, I got bad news for you, some custodians will combine the two and pass on those benefits to consumers. If done with CD-like instruments this won’t change things much, until some bank gets this genius idea: if a lender and lendee make most of their payments within the same bank, you don’t actually need to debit the lender the full loan because most of that money will stay within the bank. And if lender-custodians all partner up they can fully debit all such loans. And then because lenders don’t get their accounts locked up, whether or not their balance is loaned and for how much can be completely abstracted and presented as a shared flat yield across all lenders at the bank… (this is a simplified version of modern banking) Maybe it won’t be exactly like that, but I guarantee you, something banking-like will happen. And eventually a bank will fail because of bad risk management or a bank run. With crypto, it actually is feasible to do a huge bank run of all your money even if it’s millions of dollars, so it’ll be quick and sharp. Anybody who isn’t fast enough loses everything with no Fed to help them, we hit an extremely severe and instant deflationary depression where credit is completely unavailable, and there is no Fed to pass centralized monetary policy measures to fix it. Instead of speedrunning digital Black Friday, I’d rather the Fed just let any individual meeting whatever reserve/audit/whatever requirements use any special facility available to member banks (or remove a facility if it cannot be offered as such). So rather than replace the system due to an unfair advantage, let everybody play by the same rules. If a bank can’t compete with that, they’re not a viable business. As a consumer I can better manage my risk within what is (to me) a very similar system. Ultimately, I want the Fed to be able to buy treasuries (print money) and raise/lower rates to control inflation because I’ve tried to learn as much as I can about banking history, economics, and crypto and this still seems like the most solid way to control inflation and prevent depressions.

_heimdall 3y ago

You could also argue that the main reason bitcoin was adopted by those who bought it was to get in on the ground floor and have the unfair advantage themselves. Bitcoin hasn't solved corruption or unfair advantage, it just moves it out of the hands of the few politicians and bank executives in charge to the few running a handful of mining pools. There are still people pulling the strings that can, and have, changed the rules along the way. Even the magic number of how many bitcoins will ever be produced can be changed, that limit is no more real than the gold standard that was killed with the stroke of a pen.

timcavel 3y ago

[dead]