6 ms·

Many countries have a single dominant privately owned e-cash system. The only alternative to a future with centralized financial systems, where the individual's

Many countries have a single dominant privately owned e-cash system. The only alternative to a future with centralized financial systems, where the individual's right to transact won't be at the total mercy of the whims of forces they don't control (e.g. a corporation which deems their credit risk as unacceptably high, a political zeitgeist that deems their unwillingness to get vaccinated as making them deserving financial isolation, an authoritarian regime deeming their political outspokenness as too great a threat to their power, etc) is the ascendance of a permissionless decentralized financial system using a ledger with distributed consensus, like the public blockchain.

pgeorgi 3y ago
> like the public blockchain Since this thread is about an article celebrating UPI's 10B transactions/month: That means between 4133 (28 days/month) and 3733 (31 days/month) transactions per second on average. Bitcoin is at 7 transactions per second. The bitcoin blockchain takes ~500GB these days. At UPI's transaction volume, it'd take 250TB by now, replicated at various sites. Whatever you think of blockchain, it has some serious work ahead.
- ETH_start 3y ago
  That's an excellent point, as scalability has been the critical handicap of public blockchains to date. This article is nearly two years old, but provides a good overview of the latest techniques devised for achieving scalability in public blockchains: https://polynya.medium.com/rollups-data-availability-layers-modular-blockchains-introductory-meta-post-5a1e7a60119d https://polynya.medium.com/rollups-data-availability-layers-... Since then, layer 2s (which are the principal execution layer of the modular blockchain stack the article above expounds upon) have seen exponential growth in adoption, and mounting innovations bringing them progressively closer to their theoretical potential of 100,000 transactions per second: https://l2beat.com/scaling/activity https://l2beat.com/scaling/activity
  - chx 3y ago
    > scalability has been the critical handicap of public blockchains to date. Also, the blatant scam nature of them is a bit of a problem. While there's a lot of hype, the Washington Post already printed the truth in 2015 https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitcoin-isnt-the-future-of-money-its-either-a-ponzi-scheme-or-a-pyramid-scheme/ https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitco... which an economy professor have nicely expanded on in two blog posts https://ic.unicamp.br/~stolfi/bitcoin/2020-12-31-bitcoin-ponzi.html https://ic.unicamp.br/~stolfi/bitcoin/2020-12-31-bitcoin-pon... https://www.ic.unicamp.br/~stolfi/bitcoin/2021-01-16-yes-ponzi.html https://www.ic.unicamp.br/~stolfi/bitcoin/2021-01-16-yes-pon...
    - ETH_start 3y ago
      The only fundamental difference inherent to the respective designs of blockchains and traditional banking, is censorship resistance through genuine self-custody. The former is designed to provide this quality, and the latter is not. Put another way, there is nothing inherently scammy in using a distributed blockchain to record balances, and cryptography to authenticate updates to the balances. While opening the door to financial contracts to every one in the world with a computing device may make scam offerings more common, it's overly simplistic and lazy to resort to a caricature of crypto tokens being, as a rule, scams. Articles like the ones you linked above want a return to serfdom, under the control of officialdom. There is no other conceivable reason why someone would not want people to have at least the option of taking custody over their own money, in a form more useful than physical cash.
      - oblio 3y ago
        Most of what you wrote presumes anonymity. In long lived immutable digital systems, guess what, that doesn't exist. Talk to your actual scientist cousins, crypto-graphers. If we're at the "totalitarian government" stage, "easily readable immutable data source" is EXACTLY what they'd dream of.
        ETH_start 3y ago
- spraveenitpro 3y ago
  [dead]
kemotep 3y ago
Why wouldn’t this hypothetical authoritarian government also just ban the use of crypto currency? If they then ban you from transacting while in their jurisdiction, and you don’t become homeless, starve to death, and so on, why would they not arrest you for clearly violating their unjust laws when you pay for those things in crypto?
- ETH_start 3y ago
  An institution like physical cash can be powerful/deeply-embedded enough to survive authoritarian governments, and I presume the same would would apply to a widely adopted electronic cash. The political cost to do away with an institution grows in proportion to how pervasive it is.
  - kemotep 3y ago
    That completely side steps the question at hand. You, a citizen of an authoritarian regime, are banned from doing transactions and participating in the economy because you are a dissident or not vaccinated or whatever. Why would that ban not also include cash and crypto transactions?
    - ETH_start 3y ago
      Firstly, that ban would be harder to enforce without centralized intermediaries that can be deputized to blacklist the dissidents. Second, it is politically and generally legally easier to prohibit a class of interactions involving a subset of the population (e.g. those who refused to be vaccinated against COVID) by way of prohibiting intermediaries from interacting with them. So for instance, restaurants were prohibited from serving the unvaccinated in many jurisdictions, but the unvaccinated were not prohibited from patronizing restaurants. The authoritarian policy was easier to enforce like this, because the direct target was commercial establishments, which is a smaller group whom the population at large is less likely to defend, and a group that is already subject to greater restrictions. Easier still to enforce restrictions on would be handful of financial intermediaries. Another example would be restrictions on investment. The SEC prohibits companies from selling stock to the public without meeting onerous registration requirements, but it does not prohibit the public from buying stock from companies without SEC approval to sell stock. The ban on the stock issuer is enough to deny the public the ability to invest in non-SEC-approved stock, and it is politically much more viable than imposing prohibitions directly on the public. The administrative and political cost of imposing authoritarian policies increases in proportion to the size of the set of parties that need to have their actions restricted to effectively enforce the policy.
ramraj07 3y ago
It might have been a marginally acceptable argument 5 years back. Not anymore. the Winkelvii have redobuled the image of the charlatans they are, alongside every single person I have ever encountered in my life or in media who promulgated crypto bs. I have long since been successfully using crypto advocacy as a way to avoid people I should just not bother with and have been living a happy life.
- ETH_start 3y ago
  To me the argument has gotten dramatically stronger over the last five years as crypto's real world utility has grown and its full potential has come closer to being realized, while increasingly mainstream figures—including the most successful venture capitalists of this generation—acknowledge its inherent utility. The anti-crypto contigent are consistently small-minded neurotic individuals who could be safely ignored if they did not back repressive government measures like futile COVID lockdowns, or a "War on Drugs" or "War on Crypto".
wtmt 3y ago
While I agree with many of your points, in this context, UPI is just a money transfer platform. It’s not currency or a currency equivalent of any sort. There is a CBDC (Central Bank Digital Currency) in a pilot phase in India since last year.
- ETH_start 3y ago
  The UPI is an interface for the Immediate Payment Service, which is a payment network owned and operated by the National Payments Corporation of India, which in turned is owned jointly by the Indian government and an association of private Indian banks: the Indian Banks' Association. I personally think a centrally owned service like the IPS is very useful. I just think we would be better off having a permissionless and decentralized alternative that has wide enough adoption to make useful and hard to prohibit, to both provide competition to the centrally controlled network, and to act as a failsafe in case that network is mismanaged and run in an abusive fashion, e.g. locking out those who refused to get a COVID vaccine.

pgeorgi 3y ago

> like the public blockchain Since this thread is about an article celebrating UPI's 10B transactions/month: That means between 4133 (28 days/month) and 3733 (31 days/month) transactions per second on average. Bitcoin is at 7 transactions per second. The bitcoin blockchain takes ~500GB these days. At UPI's transaction volume, it'd take 250TB by now, replicated at various sites. Whatever you think of blockchain, it has some serious work ahead.

ETH_start 3y ago
That's an excellent point, as scalability has been the critical handicap of public blockchains to date. This article is nearly two years old, but provides a good overview of the latest techniques devised for achieving scalability in public blockchains: https://polynya.medium.com/rollups-data-availability-layers-modular-blockchains-introductory-meta-post-5a1e7a60119d https://polynya.medium.com/rollups-data-availability-layers-... Since then, layer 2s (which are the principal execution layer of the modular blockchain stack the article above expounds upon) have seen exponential growth in adoption, and mounting innovations bringing them progressively closer to their theoretical potential of 100,000 transactions per second: https://l2beat.com/scaling/activity https://l2beat.com/scaling/activity
- chx 3y ago
  > scalability has been the critical handicap of public blockchains to date. Also, the blatant scam nature of them is a bit of a problem. While there's a lot of hype, the Washington Post already printed the truth in 2015 https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitcoin-isnt-the-future-of-money-its-either-a-ponzi-scheme-or-a-pyramid-scheme/ https://www.washingtonpost.com/news/wonk/wp/2015/06/08/bitco... which an economy professor have nicely expanded on in two blog posts https://ic.unicamp.br/~stolfi/bitcoin/2020-12-31-bitcoin-ponzi.html https://ic.unicamp.br/~stolfi/bitcoin/2020-12-31-bitcoin-pon... https://www.ic.unicamp.br/~stolfi/bitcoin/2021-01-16-yes-ponzi.html https://www.ic.unicamp.br/~stolfi/bitcoin/2021-01-16-yes-pon...
  - ETH_start 3y ago
    The only fundamental difference inherent to the respective designs of blockchains and traditional banking, is censorship resistance through genuine self-custody. The former is designed to provide this quality, and the latter is not. Put another way, there is nothing inherently scammy in using a distributed blockchain to record balances, and cryptography to authenticate updates to the balances. While opening the door to financial contracts to every one in the world with a computing device may make scam offerings more common, it's overly simplistic and lazy to resort to a caricature of crypto tokens being, as a rule, scams. Articles like the ones you linked above want a return to serfdom, under the control of officialdom. There is no other conceivable reason why someone would not want people to have at least the option of taking custody over their own money, in a form more useful than physical cash.
    - oblio 3y ago
      Most of what you wrote presumes anonymity. In long lived immutable digital systems, guess what, that doesn't exist. Talk to your actual scientist cousins, crypto-graphers. If we're at the "totalitarian government" stage, "easily readable immutable data source" is EXACTLY what they'd dream of.
      - ETH_start 3y ago
spraveenitpro 3y ago
[dead]

kemotep 3y ago

Why wouldn’t this hypothetical authoritarian government also just ban the use of crypto currency? If they then ban you from transacting while in their jurisdiction, and you don’t become homeless, starve to death, and so on, why would they not arrest you for clearly violating their unjust laws when you pay for those things in crypto?

ETH_start 3y ago
An institution like physical cash can be powerful/deeply-embedded enough to survive authoritarian governments, and I presume the same would would apply to a widely adopted electronic cash. The political cost to do away with an institution grows in proportion to how pervasive it is.
- kemotep 3y ago
  That completely side steps the question at hand. You, a citizen of an authoritarian regime, are banned from doing transactions and participating in the economy because you are a dissident or not vaccinated or whatever. Why would that ban not also include cash and crypto transactions?
  - ETH_start 3y ago
    Firstly, that ban would be harder to enforce without centralized intermediaries that can be deputized to blacklist the dissidents. Second, it is politically and generally legally easier to prohibit a class of interactions involving a subset of the population (e.g. those who refused to be vaccinated against COVID) by way of prohibiting intermediaries from interacting with them. So for instance, restaurants were prohibited from serving the unvaccinated in many jurisdictions, but the unvaccinated were not prohibited from patronizing restaurants. The authoritarian policy was easier to enforce like this, because the direct target was commercial establishments, which is a smaller group whom the population at large is less likely to defend, and a group that is already subject to greater restrictions. Easier still to enforce restrictions on would be handful of financial intermediaries. Another example would be restrictions on investment. The SEC prohibits companies from selling stock to the public without meeting onerous registration requirements, but it does not prohibit the public from buying stock from companies without SEC approval to sell stock. The ban on the stock issuer is enough to deny the public the ability to invest in non-SEC-approved stock, and it is politically much more viable than imposing prohibitions directly on the public. The administrative and political cost of imposing authoritarian policies increases in proportion to the size of the set of parties that need to have their actions restricted to effectively enforce the policy.

ramraj07 3y ago

It might have been a marginally acceptable argument 5 years back. Not anymore. the Winkelvii have redobuled the image of the charlatans they are, alongside every single person I have ever encountered in my life or in media who promulgated crypto bs. I have long since been successfully using crypto advocacy as a way to avoid people I should just not bother with and have been living a happy life.

ETH_start 3y ago
To me the argument has gotten dramatically stronger over the last five years as crypto's real world utility has grown and its full potential has come closer to being realized, while increasingly mainstream figures—including the most successful venture capitalists of this generation—acknowledge its inherent utility. The anti-crypto contigent are consistently small-minded neurotic individuals who could be safely ignored if they did not back repressive government measures like futile COVID lockdowns, or a "War on Drugs" or "War on Crypto".

wtmt 3y ago

While I agree with many of your points, in this context, UPI is just a money transfer platform. It’s not currency or a currency equivalent of any sort. There is a CBDC (Central Bank Digital Currency) in a pilot phase in India since last year.

ETH_start 3y ago
The UPI is an interface for the Immediate Payment Service, which is a payment network owned and operated by the National Payments Corporation of India, which in turned is owned jointly by the Indian government and an association of private Indian banks: the Indian Banks' Association. I personally think a centrally owned service like the IPS is very useful. I just think we would be better off having a permissionless and decentralized alternative that has wide enough adoption to make useful and hard to prohibit, to both provide competition to the centrally controlled network, and to act as a failsafe in case that network is mismanaged and run in an abusive fashion, e.g. locking out those who refused to get a COVID vaccine.