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I don't think the pure commodity coins (layer 1 networks like btc, xch, etc) are confusing at all. You do work and get rewarded with a digital commodity. It’s e

by dcow 3y ago

I don't think the pure commodity coins (layer 1 networks like btc, xch, etc) are confusing at all. You do work and get rewarded with a digital commodity. It’s exactly like digging up gold, or tapping a tree for maple syrup. Then a bunch of crypto anarchists showed up and started speculating that these coins would be worth a lot in the future because we could topple the financial hegemony by their powers combined. Okay whatever, still commodity trading. Then we started getting all these fake Ponzi coins that are standing in for something else. That’s a security. What is possible with e.g. BTC is that it’s easy to trade at scale. A commodity that’s easy to trade isn't a security, but if you squint it kinda looks like one. Regardless, it’s not crypto’s fault that regulators are having a hard time understanding it. That’s the regulators’ and lawmakers' problem. (So elect people into power who are your peers, and who aren't 70 years old and have no hope of anything more than a cursory understanding world from the last 20 years.) But, of course they’re not going to stand aside while people get scammed. Only the anarchists want that. The rest of us just want crypto to be treated fairly.

lottin 3y ago
But what on earth is a digital commodity? I think the whole concept of digital commodity is nonsensical. A commodity is a product. Products are either consumed or used as raw materials. A digital commodity is not a product. It can't be consumed or used, because it's entirely imaginary. I think a better term is "abstract unit of account".
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- dcow 3y ago
  Respectfully, I think your understanding is behind the curve. Even the SEC says BTC itself is a commodity. You consume a BTC by using/trading it. You consume gold or maple syrup by using/trading it. Just because the uses are a little different doesn't mean it's incompatible with the definition of commodity. If I started using gold in a nonsensical way you wouldn't start saying "oh now it's a security", would you?
  - mulmen 3y ago
    I think the hangup with BTC as a commodity is that I can make a loaf of bread with wheat and eat it and the amount of wheat in the world is depleted as a result. Similarly I can use gold to build a cell phone or some jewelry and while it is possible to recover it isn't as simple as trading BTC. How is a BTC consumed?
    - scottiebarnes 3y ago
      The majority of gold usage is in investment/central bank reserve. Technology applications are a fraction of the usage. Jewelry is a major usage, however part of the reason for its use in jewelry is a hybrid combination of its store of value properties (ex. in Indian culture afaik, gold jewelry plays a large part in passing down wealth, families gift gold jewelry at weddings etc.). So you consume bitcoin the same way a central bank consumes gold: by sitting on it, selling it when you need to, or buying more in times of expected turmoil. Bitcoin is far younger than gold (12 years vs thousands), so its obviously more volatile. https://www.statista.com/statistics/299609/gold-demand-by-industry-sector-share/ https://www.statista.com/statistics/299609/gold-demand-by-in...
      - mulmen 3y ago
        Trading something doesn’t consume it. That’s a very confusing overloading of terminology.
        scottiebarnes 3y ago
        Well consumer comes from the base word consume, which by definition includes the buying of a good or service, which is essentially a trade. Consume: - eat, drink, or ingest (food or drink). - buy (goods or services). - use up (a resource). - (especially of a fire) completely destroy. - (of a feeling) absorb all of the attention and energy of (someone).
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- JumpinJack_Cash 3y ago
  You can consume a Fortnite skin or a Call of Duty weapon. The point is that you cannot consume crypto, it's a problem which is understood inside the community, that's why the push for NFTs which started as legitimate art to enjoy on huge 8K screens or VR headsets but quickly ended up becoming Twitter avatars built for the purpose of trading and offloading to a bigger fool.
  - dcow 3y ago
    You consume it by trading it or, for a direct analog to your example, by showing off your wallet balance. Your Fortnite skin is no more consumable than a BTC. It just has a different value and use.
    - JumpinJack_Cash 3y ago
      > > You consume it by trading Hence the SEC is right to clampdown on crypto for violations of securities law, in order to prevent bubbles that emerge when the only use for something is trading it for something else. We already have that, people who want to participate in that game know where to go, the stock market. > > for a direct analog to your example, by showing off your wallet balance That's the most circular thought I've ever heard.
      - dcow 3y ago
        1st, you need to read up on how commodities and securities are regulated. 2nd, showing off your wallet balance is the same as showing off your NFT, and NFTs, digital skins, etc. are all obviously consumables.
    - lottin 3y ago
      Trading a commodity doesn't consume it. If I trade a hamburger, the hamburger isn't consumed. It's only consumed when I eat it.
this_user 3y ago
I think it's more a case that anyone who was involved in crypto early, and who has actually taken the time to understand the technology, has realised about a decade ago that crypto currencies are mostly useless. But then people had they idea that they could still make money from it by grifting people if they just added layer upon layer of complexity in order to disguise the ultimate uselessness of the underlying technology. That is where all of your Ponzis, rugpulls, NFTs and everything else comes into the picture.
- dcow 3y ago
  Meh, I'm no bull but I also don't think "cryptos are mostly useless" is accurate. I believe there are solid use cases for distributed global ledger and digital replacement for cash. Is Bitcoin the winning/best manifestation? I doubt it, we likely need something much more energy efficient (like Chia is trying to be). But I don't think the idea is bust. It just isn't as overwhelmingly applicable as people dreamed it might be. We're trying out use cases, vetting the good ones and sometimes painfully learning the which ones were stupid or bad ideas. And once all the speculation settles, I do think true currency is still a viable one. Logistics and markets are another, etc.
  - thisgoesnowhere 3y ago
    I don't think anyone here is arguing that digital cash or a global ledger is bad they are arguing that the specific structures and incentives of crypto are bad. Bring on the digital cash IMO but bearer instruments underpinning any large scale finance is a recipe for disaster.
  - acjohnson55 3y ago
    I think that it's still unproven that a distributed global ledger is actually a fundamentally useful thing, outside of speculation. We're 15 years out from the invention of Bitcoin, and if all of blockchain technology snapped out of existence today, there are very few people, other than speculators, who would be impacted. It has comprehensively failed to be adopted into any value chains.
davidgerard 3y ago
> Then a bunch of crypto anarchists showed up they literally started bitcoin and were the guys mapping out what they wanted from a digital currency over the previous twenty years, this is well known history
- dcow 3y ago
  My point is simply that crypto requiring a nuanced legal treatment is not implicitly by design even if it was promoted as a feature early on by grifters and anarchists. It’s a technology like any other and it’s the regulators’ job to create fair and appropriate treatment for it (and our job to elect ones who will).
  - ethanbond 3y ago
    Bitcoin was literally designed to circumvent state monetary systems and their affiliated controls. Almost all the crypto descendants follow this path as well. So yes, it was by design that it’s hard to regulate.
    - dcow 3y ago
      What about bitcoin makes it any harder to regulate than cash?
      - llamaimperative 3y ago
        First of all, the actual difficulty is not really material since we're debating whether it was a design goal. Bitcoin came out of a long line of libertarian/anarchist projects to circumvent state controls. I don't know why you're pretending like this is some unique interpretation of history. E.g. the problem that the Satoshi whitepaper sets out to solve was (as cited in the whitepaper, source [1] in the footnotes) laid out with this preamble: > I am fascinated by Tim May's crypto-anarchy. Unlike the communities traditionally associated with the word "anarchy", in a crypto-anarchy the government is not temporarily destroyed but permanently forbidden and permanently unnecessary. Secondly, a lot of features make it harder to regulate than cash. Off the top of my head, being able to transport it over national borders via the Internet. Storing arbitrarily large amounts of it in zero physical square meters. Keeping it relatively secure without having to rely on third parties (banks) gaining knowledge of your ownership, etc. etc.
antasvara 3y ago
Where the definition gets confusing is when a cryptocurrency gives you voting rights to modify the underlying protocol, or determine the direction of an entity that manages the underlying protocol, etc. There isn't (AFAIK) a commodity that operates in this manner. Owning a lot of gold doesn't mean that I'm able to unilaterally adjust how gold is mined or obtained, for example.
- duskwuff 3y ago
  Or when a cryptocurrency has bizarre rules controlling how it can be traded -- for instance, a number of Ethereum tokens like Safemoon had rules enforcing a "tax" on all transfers, ostensibly to reduce volatility.
skinnymuch 3y ago
Do you mean libertarians or the contradictory “ancaps”? What does anarchist mean to you in your writing? Or why use that word? Any examples of anarchists doing what you’re saying for extended periods of time like cryptobros would be helpful to understand. Thanks.
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by dcow 3y ago

lottin 3y ago

But what on earth is a digital commodity? I think the whole concept of digital commodity is nonsensical. A commodity is a product. Products are either consumed or used as raw materials. A digital commodity is not a product. It can't be consumed or used, because it's entirely imaginary. I think a better term is "abstract unit of account".

deleted 3y ago
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deleted 3y ago
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dcow 3y ago
Respectfully, I think your understanding is behind the curve. Even the SEC says BTC itself is a commodity. You consume a BTC by using/trading it. You consume gold or maple syrup by using/trading it. Just because the uses are a little different doesn't mean it's incompatible with the definition of commodity. If I started using gold in a nonsensical way you wouldn't start saying "oh now it's a security", would you?
- mulmen 3y ago
  I think the hangup with BTC as a commodity is that I can make a loaf of bread with wheat and eat it and the amount of wheat in the world is depleted as a result. Similarly I can use gold to build a cell phone or some jewelry and while it is possible to recover it isn't as simple as trading BTC. How is a BTC consumed?
  - scottiebarnes 3y ago
    The majority of gold usage is in investment/central bank reserve. Technology applications are a fraction of the usage. Jewelry is a major usage, however part of the reason for its use in jewelry is a hybrid combination of its store of value properties (ex. in Indian culture afaik, gold jewelry plays a large part in passing down wealth, families gift gold jewelry at weddings etc.). So you consume bitcoin the same way a central bank consumes gold: by sitting on it, selling it when you need to, or buying more in times of expected turmoil. Bitcoin is far younger than gold (12 years vs thousands), so its obviously more volatile. https://www.statista.com/statistics/299609/gold-demand-by-industry-sector-share/ https://www.statista.com/statistics/299609/gold-demand-by-in...
    - mulmen 3y ago
      Trading something doesn’t consume it. That’s a very confusing overloading of terminology.
      - scottiebarnes 3y ago
        Well consumer comes from the base word consume, which by definition includes the buying of a good or service, which is essentially a trade. Consume: - eat, drink, or ingest (food or drink). - buy (goods or services). - use up (a resource). - (especially of a fire) completely destroy. - (of a feeling) absorb all of the attention and energy of (someone).
        deleted 3y ago
        [deleted]
JumpinJack_Cash 3y ago
You can consume a Fortnite skin or a Call of Duty weapon. The point is that you cannot consume crypto, it's a problem which is understood inside the community, that's why the push for NFTs which started as legitimate art to enjoy on huge 8K screens or VR headsets but quickly ended up becoming Twitter avatars built for the purpose of trading and offloading to a bigger fool.
- dcow 3y ago
  You consume it by trading it or, for a direct analog to your example, by showing off your wallet balance. Your Fortnite skin is no more consumable than a BTC. It just has a different value and use.
  - JumpinJack_Cash 3y ago
    > > You consume it by trading Hence the SEC is right to clampdown on crypto for violations of securities law, in order to prevent bubbles that emerge when the only use for something is trading it for something else. We already have that, people who want to participate in that game know where to go, the stock market. > > for a direct analog to your example, by showing off your wallet balance That's the most circular thought I've ever heard.
    - dcow 3y ago
      1st, you need to read up on how commodities and securities are regulated. 2nd, showing off your wallet balance is the same as showing off your NFT, and NFTs, digital skins, etc. are all obviously consumables.
  - lottin 3y ago
    Trading a commodity doesn't consume it. If I trade a hamburger, the hamburger isn't consumed. It's only consumed when I eat it.

this_user 3y ago

I think it's more a case that anyone who was involved in crypto early, and who has actually taken the time to understand the technology, has realised about a decade ago that crypto currencies are mostly useless. But then people had they idea that they could still make money from it by grifting people if they just added layer upon layer of complexity in order to disguise the ultimate uselessness of the underlying technology. That is where all of your Ponzis, rugpulls, NFTs and everything else comes into the picture.

dcow 3y ago
Meh, I'm no bull but I also don't think "cryptos are mostly useless" is accurate. I believe there are solid use cases for distributed global ledger and digital replacement for cash. Is Bitcoin the winning/best manifestation? I doubt it, we likely need something much more energy efficient (like Chia is trying to be). But I don't think the idea is bust. It just isn't as overwhelmingly applicable as people dreamed it might be. We're trying out use cases, vetting the good ones and sometimes painfully learning the which ones were stupid or bad ideas. And once all the speculation settles, I do think true currency is still a viable one. Logistics and markets are another, etc.
- thisgoesnowhere 3y ago
  I don't think anyone here is arguing that digital cash or a global ledger is bad they are arguing that the specific structures and incentives of crypto are bad. Bring on the digital cash IMO but bearer instruments underpinning any large scale finance is a recipe for disaster.
- acjohnson55 3y ago
  I think that it's still unproven that a distributed global ledger is actually a fundamentally useful thing, outside of speculation. We're 15 years out from the invention of Bitcoin, and if all of blockchain technology snapped out of existence today, there are very few people, other than speculators, who would be impacted. It has comprehensively failed to be adopted into any value chains.

davidgerard 3y ago

> Then a bunch of crypto anarchists showed up they literally started bitcoin and were the guys mapping out what they wanted from a digital currency over the previous twenty years, this is well known history

dcow 3y ago
My point is simply that crypto requiring a nuanced legal treatment is not implicitly by design even if it was promoted as a feature early on by grifters and anarchists. It’s a technology like any other and it’s the regulators’ job to create fair and appropriate treatment for it (and our job to elect ones who will).
- ethanbond 3y ago
  Bitcoin was literally designed to circumvent state monetary systems and their affiliated controls. Almost all the crypto descendants follow this path as well. So yes, it was by design that it’s hard to regulate.
  - dcow 3y ago
    What about bitcoin makes it any harder to regulate than cash?
    - llamaimperative 3y ago
      First of all, the actual difficulty is not really material since we're debating whether it was a design goal. Bitcoin came out of a long line of libertarian/anarchist projects to circumvent state controls. I don't know why you're pretending like this is some unique interpretation of history. E.g. the problem that the Satoshi whitepaper sets out to solve was (as cited in the whitepaper, source [1] in the footnotes) laid out with this preamble: > I am fascinated by Tim May's crypto-anarchy. Unlike the communities traditionally associated with the word "anarchy", in a crypto-anarchy the government is not temporarily destroyed but permanently forbidden and permanently unnecessary. Secondly, a lot of features make it harder to regulate than cash. Off the top of my head, being able to transport it over national borders via the Internet. Storing arbitrarily large amounts of it in zero physical square meters. Keeping it relatively secure without having to rely on third parties (banks) gaining knowledge of your ownership, etc. etc.

antasvara 3y ago

Where the definition gets confusing is when a cryptocurrency gives you voting rights to modify the underlying protocol, or determine the direction of an entity that manages the underlying protocol, etc. There isn't (AFAIK) a commodity that operates in this manner. Owning a lot of gold doesn't mean that I'm able to unilaterally adjust how gold is mined or obtained, for example.

duskwuff 3y ago
Or when a cryptocurrency has bizarre rules controlling how it can be traded -- for instance, a number of Ethereum tokens like Safemoon had rules enforcing a "tax" on all transfers, ostensibly to reduce volatility.

skinnymuch 3y ago

Do you mean libertarians or the contradictory “ancaps”? What does anarchist mean to you in your writing? Or why use that word? Any examples of anarchists doing what you’re saying for extended periods of time like cryptobros would be helpful to understand. Thanks.

deleted 3y ago

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