5 ms·

Gold is used to make things. You can argue what its value should be as a material alone, but it’s not entirely speculation.

by kerbs 2y ago

exe34 2y ago
can you make useful things with abstract art? They're not even good as toilet paper and yet people still buy and trade them.
hparadiz 2y ago
Crypto can be used as a store of wealth when crossing borders preventing search and seizure of your wealth against overzealous governments. See Russia in the early 90s which would regularly search and confiscate cash from people leaving. That alone makes it very valuable.
- Larrikin 2y ago
  What's the scenario where the government can take the digital money from your bank accounts but can't take the digital money from your crypto wallet?
  - DennisP 2y ago
    Any scenario where you're sufficiently careful with your private keys.
    - rounce 2y ago
      What happens when they bust out the $5 wrench?
      - fallingsquirrel 2y ago
        They would need 300 million wrenches, one for each citizen. That leaves society in a much better position than letting them do it at scale with an sql query.
        rounce 2y ago
        Are wrenches single-use, or are you allocating individual attackers per-citizen? In the case of a successful wrench attacker, how are the stolen funds recovered?
        fallingsquirrel 2y ago
        This is the classic time-money tradeoff. Theoretically you only need one wrench and one attacker—but even if she attacks 100 people a day it would take thousands of years to reach everyone. And word of the attacks would spread, so later victims would take steps to safeguard their money and the attacks would become ineffective. To be maximally effective you'd need to mobilize enough attackers and enough windowless white vans to reach the entire populace within probably a day, so let's say 3 million attackers and 3 million white vans. That's when things start getting more expensive than the sql query.
        tmottabr 2y ago
        that is assuming every citizen has a crypto wallet, something is not even close to be true.. i would guess that percentage of people with wallets would be very small and a relative small team could with a relative small number of white vans and wrenches could get every single one in relative short time.. and for countries that heavily monitor internet usage, like china, i bet they could have a list with pretty good assumptions on who has crypto that they can target for further investigation before sending the wrenched goons..
      - kragen 2y ago
        You give them one of your three seed phrases.
  - jliptzin 2y ago
    When they don't know the crypto wallet exists?
    - Larrikin 2y ago
      There is no scenario where the government doesn't know it exist and the Bitcoin is useful in any way to your life. If you ever use it for any thing there's a bright line directly to you. The silk road guy was taken down for screwing up one time years before he even started the website. Maybe a criminal organization that forces their grand children into it can potentially hide a wallet.
      - tim333 2y ago
        The silk road guy pretty much had a government department trying to shut him down. They don't have the resources to do that for the average individual.
        tmottabr 2y ago
        yeah, but that was more then 10 years ago.. i bet the analysis for that is all automated by now and built into their systems, making it much easier to go after the average individual.
  - nicky0 2y ago
    Government cannot take money from a crypto wallet because of cryptography. They could only do it if they compelled you to hand over your secret keys against your will. They also may not even know you have a crypto wallet since it is not registered in your name and is very easy to hide. On the other hand, government can sieze funds from your bank account by seeking a court order or whatever legal instrument is needed in your jurisdiction.
    - freefaler 2y ago
      Exactly, and that's why in EU a transaction to a self-custody wallet from an exchange you need to declare that wallet as your own. Then when the government want to seize your BTC they can track from that wallet onwards all transactions. The problem with crypto as a hedge against government overreach is with fiat exchanges. I hope more businesses start accepting crypto and you won't need to go trough an exchange that often.
      - t0bia_s 2y ago
        You can use cash to buy BTC in bitcoinmat. If you want anonymity while buying it on public place, use mask.
    - mistrial9 2y ago
      no, while you are typing, there are senior finance legislators that are reviewing multi-hundred page reports where "the only legal way to trade is with a licensed broker" i.e. you Joe Citizen cannot hold your own keys. If you have not heard of this, welcome to old news in the USA and elsewhere. This is not fringe or conspiracy at all.. this is lawyers in the backroom for the last year(s).
    - multjoy 2y ago
      What they can do is (in England & Wales, for example) is to impose a confiscation order on you so when you do end up liquidating your easily traceable crypto current, they will simply come after those assets.
  - tivert 2y ago
    > What's the scenario where the government can take the digital money from your bank accounts but can't take the digital money from your crypto wallet? In cryptocurrency's defense (I am not a Bitcoiner), it not as easy for them to do that, because they can't just order a bank to transfer it/freeze it....assuming the owner is going through a lot of elaborate, inconvenient, and easy to footgun security measures. If you have a Coinbase wallet you're in exactly the same situation as if you had cash in the bank. HOWEVER, the cost people pay to get that is stupidly high. For every suave international drug dealer who's kept their money out of the hands of the evil government with Bitcoin, you probably have 1,000 dudes or more, who lost the keys to their wallet somehow or got their Bitcoin stolen in a hack. So you probably shouldn't be worrying to much about duh gubbament. And then, the obligatory xkcd about crypto: https://xkcd.com/538/ https://xkcd.com/538/ / https://arstechnica.com/security/2024/09/forget-hacking-this-gang-just-beat-people-to-steal-their-crypto/ https://arstechnica.com/security/2024/09/forget-hacking-this....
    - fallingsquirrel 2y ago
      These threads always leave me baffled. Some people say that only drug dealers use bitcoin. Others say the ratio of normal dudes to drug dealers is 1,000:1 or more. I guess it depends what sounds convenient at the time.
      - tivert 2y ago
        If you worry about the government seizing your money like that, you really should be someone whose money the government wants to seize [1]. Those people aren't regular dude software engineers. [1] Also, keeping your money in a bank account almost certainly product you from those controversial civil forfeiture situations.
      - Thorrez 2y ago
        I think the argument is that the drug dealers are actually using bitcoin for its utility, whereas the 1000 normal dudes are just buying it as an investment, not to use.
        2y ago
  - kragen 2y ago
    It's true that bank accounts are relatively secure from seizure when crossing borders, but literally everybody I know here in Argentina who's my age or older lost three quarters of the savings in their bank accounts 23 years ago, because the government took it by converting dollars to pesos at the 1:1 pegged exchange rate and then dropping the peg. In a cryptocurrency wallet (a real one, not an exchange like Mt.Gox, Coinbase, or Binance) they wouldn't have lost anything. Another case is when a foreign government puts you on a sanctions list and freezes your assets in the banks under their jurisdiction. This has happened to a lot of Russians and Russian companies in the last few years. (It also happened to the foreign reserves of the Russian central bank, but Bitcoin is not liquid enough to be a significant international reserve asset.) Another case is when the government suspects you of some kind of wrongdoing but can't physically find you, or can find you but for whatever reason isn't willing to torture you. For example, two and a half years ago, some truckers in Canada staged a protest for misguided reasons, and the Canadian government of Justin Trudeau froze not only the truckers' bank accounts, and the organizers' bank accounts, but even bank accounts suspected to belong to people who were suspected of donating to the protest: https://www.cato.org/blog/emergencies-act-after-two-years https://www.cato.org/blog/emergencies-act-after-two-years https://www.newsweek.com/banks-have-begun-freezing-accounts-linked-trucker-protest-1680649 https://www.newsweek.com/banks-have-begun-freezing-accounts-... https://nationalpost.com/news/politics/bureaucrats-who-froze-bank-accounts-of-freedom-convoy-leaders-werent-trying-to-get-at-the-family https://nationalpost.com/news/politics/bureaucrats-who-froze... > In freezing the bank accounts of Freedom Convoy protesters, Finance Canada bureaucrats said they did not intend to hurt protesters’ families’ ability to buy groceries or pay child support, though they admitted that may have ultimately happened, the Emergencies Act inquiry heard Thursday. (...) Two weeks ago, some Freedom Convoy organizers testified their spouses were cut off from their money and couldn’t make vehicle payments or purchase groceries and medication because joint bank accounts were frozen. Earlier this year, a court found that the government's actions at the time were illegal. https://freespeechunion.org/trudeau-government-not-justified-in-freezing-protesters-bank-accounts-court-rules/ https://freespeechunion.org/trudeau-government-not-justified... explains: > In pursuing this novel form of politically motivated financial censorship, Prime Minister Trudeau was following in the footsteps of Russian President Vladmir Putin, who in 2019 ordered his government to freeze bank accounts linked to opposition politician Alexei Navalny. And of course it's well known that, when Wikileaks was targeted by the US government for their journalism, Visa and Mastercard cut off their donations despite apparently having no legal requirement to do so, while Bitcoin donations were able to continue. This was crucial in enabling Wikileaks to support Snowden's escape from the US when he revealed the extent of the US's illegal spying on its own citizens.
- kerbs 2y ago
  You made a subtle, but important, pivot from the topic of “Bitcoin” to the broader topic of “crypto”. Bitcoin specifically, with its multi-trillion dollar market cap, is built up that high purely on speculation. It is a very fragile store of wealth, especially the higher its market cap becomes.
superfist 2y ago
and how much of gold price is in your opinion value of material itself? Strip out that material price and you have speculation price. Price of Bitcoin is mostly that speculation price + instead of material some mathematical properties.
- lottin 2y ago
  > Price of Bitcoin is mostly that speculation price + instead of material some mathematical properties. Mathematical properties don't provide economic value. The demand for bitcoin is almost all speculation, and a tiny bit is for purposes of making clandestine payments, paying ransoms, and such.
  - superfist 2y ago
    So, access to a permissionless SWIFT-like system from anywhere around the world has no economic value in your opinion? Go and ask people in African countries what it means to them.
    - lottin 2y ago
      I said _mathematical properties_ have no economic value.
      - superfist 2y ago
        Most paper money intrinsically has no value at all, even the paper it is printed on can't be used as toilet paper due to its lack of softness. It is only a medium of labor exchange. For me, Bitcoin is exactly the same, but in a very new form, backed by math instead of a government.
        lottin 2y ago
        You're quite right that neither fiat money nor bitcoin have intrinsic value, though they both have exchange value (i.e. market value). This means there must be a demand that prevents the market value from falling to zero. In the case of fiat currency, the public demands fiat currency for transaction purposes and to pay taxes. In the case of bitcoin, the demand for transaction purposes is anecdotal, almost nonexistent. So the demand for bitcoin is almost entirely speculative. (There's no other possibility as far as I know, given no intrinsic value.) In other words, people demand bitcoin because they expect that the price of bitcoin will go up. Such a demand can be sustained as long as people continue to have the same expectations. When (or if) these expectations change, the demand can evaporate quite quickly, and the price will collapse dramatically as a result. So bitcoin is not backed by math. It's backed by a speculative demand.
chairmansteve 2y ago
BTC is used for trade. You know, drugs etc. And money laundering. Sanctions busting. Tax avoidance. It has a lot of utility...
- lesuorac 2y ago
  BTC is pretty bad for illegal activity since the transactions are public. You'd be much better off using the US Dollar. Even if it's through a bank like HSBC.
- kerbs 2y ago
  It is used for those things I agree. Those things alone do not hold up a $1.5T market cap. I would say they don’t hold up a $1.5B cap either.

Gold is used to make things. You can argue what its value should be as a material alone, but it’s not entirely speculation.

by kerbs 2y ago

Gold is used to make things. You can argue what its value should be as a material alone, but it’s not entirely speculation.

exe34 2y ago

can you make useful things with abstract art? They're not even good as toilet paper and yet people still buy and trade them.

hparadiz 2y ago

Crypto can be used as a store of wealth when crossing borders preventing search and seizure of your wealth against overzealous governments. See Russia in the early 90s which would regularly search and confiscate cash from people leaving. That alone makes it very valuable.

Larrikin 2y ago
What's the scenario where the government can take the digital money from your bank accounts but can't take the digital money from your crypto wallet?
- DennisP 2y ago
  Any scenario where you're sufficiently careful with your private keys.
  - rounce 2y ago
    What happens when they bust out the $5 wrench?
    - fallingsquirrel 2y ago
      They would need 300 million wrenches, one for each citizen. That leaves society in a much better position than letting them do it at scale with an sql query.
      - rounce 2y ago
        Are wrenches single-use, or are you allocating individual attackers per-citizen? In the case of a successful wrench attacker, how are the stolen funds recovered?
        fallingsquirrel 2y ago
        This is the classic time-money tradeoff. Theoretically you only need one wrench and one attacker—but even if she attacks 100 people a day it would take thousands of years to reach everyone. And word of the attacks would spread, so later victims would take steps to safeguard their money and the attacks would become ineffective. To be maximally effective you'd need to mobilize enough attackers and enough windowless white vans to reach the entire populace within probably a day, so let's say 3 million attackers and 3 million white vans. That's when things start getting more expensive than the sql query.
        tmottabr 2y ago
        that is assuming every citizen has a crypto wallet, something is not even close to be true.. i would guess that percentage of people with wallets would be very small and a relative small team could with a relative small number of white vans and wrenches could get every single one in relative short time.. and for countries that heavily monitor internet usage, like china, i bet they could have a list with pretty good assumptions on who has crypto that they can target for further investigation before sending the wrenched goons..
    - kragen 2y ago
      You give them one of your three seed phrases.
- jliptzin 2y ago
  When they don't know the crypto wallet exists?
  - Larrikin 2y ago
    There is no scenario where the government doesn't know it exist and the Bitcoin is useful in any way to your life. If you ever use it for any thing there's a bright line directly to you. The silk road guy was taken down for screwing up one time years before he even started the website. Maybe a criminal organization that forces their grand children into it can potentially hide a wallet.
    - tim333 2y ago
      The silk road guy pretty much had a government department trying to shut him down. They don't have the resources to do that for the average individual.
      - tmottabr 2y ago
        yeah, but that was more then 10 years ago.. i bet the analysis for that is all automated by now and built into their systems, making it much easier to go after the average individual.
- nicky0 2y ago
  Government cannot take money from a crypto wallet because of cryptography. They could only do it if they compelled you to hand over your secret keys against your will. They also may not even know you have a crypto wallet since it is not registered in your name and is very easy to hide. On the other hand, government can sieze funds from your bank account by seeking a court order or whatever legal instrument is needed in your jurisdiction.
  - freefaler 2y ago
    Exactly, and that's why in EU a transaction to a self-custody wallet from an exchange you need to declare that wallet as your own. Then when the government want to seize your BTC they can track from that wallet onwards all transactions. The problem with crypto as a hedge against government overreach is with fiat exchanges. I hope more businesses start accepting crypto and you won't need to go trough an exchange that often.
    - t0bia_s 2y ago
      You can use cash to buy BTC in bitcoinmat. If you want anonymity while buying it on public place, use mask.
  - mistrial9 2y ago
    no, while you are typing, there are senior finance legislators that are reviewing multi-hundred page reports where "the only legal way to trade is with a licensed broker" i.e. you Joe Citizen cannot hold your own keys. If you have not heard of this, welcome to old news in the USA and elsewhere. This is not fringe or conspiracy at all.. this is lawyers in the backroom for the last year(s).
  - multjoy 2y ago
    What they can do is (in England & Wales, for example) is to impose a confiscation order on you so when you do end up liquidating your easily traceable crypto current, they will simply come after those assets.
- tivert 2y ago
  > What's the scenario where the government can take the digital money from your bank accounts but can't take the digital money from your crypto wallet? In cryptocurrency's defense (I am not a Bitcoiner), it not as easy for them to do that, because they can't just order a bank to transfer it/freeze it....assuming the owner is going through a lot of elaborate, inconvenient, and easy to footgun security measures. If you have a Coinbase wallet you're in exactly the same situation as if you had cash in the bank. HOWEVER, the cost people pay to get that is stupidly high. For every suave international drug dealer who's kept their money out of the hands of the evil government with Bitcoin, you probably have 1,000 dudes or more, who lost the keys to their wallet somehow or got their Bitcoin stolen in a hack. So you probably shouldn't be worrying to much about duh gubbament. And then, the obligatory xkcd about crypto: https://xkcd.com/538/ https://xkcd.com/538/ / https://arstechnica.com/security/2024/09/forget-hacking-this-gang-just-beat-people-to-steal-their-crypto/ https://arstechnica.com/security/2024/09/forget-hacking-this....
  - fallingsquirrel 2y ago
    These threads always leave me baffled. Some people say that only drug dealers use bitcoin. Others say the ratio of normal dudes to drug dealers is 1,000:1 or more. I guess it depends what sounds convenient at the time.
    - tivert 2y ago
      If you worry about the government seizing your money like that, you really should be someone whose money the government wants to seize [1]. Those people aren't regular dude software engineers. [1] Also, keeping your money in a bank account almost certainly product you from those controversial civil forfeiture situations.
    - Thorrez 2y ago
      I think the argument is that the drug dealers are actually using bitcoin for its utility, whereas the 1000 normal dudes are just buying it as an investment, not to use.
      - 2y ago
- kragen 2y ago
  It's true that bank accounts are relatively secure from seizure when crossing borders, but literally everybody I know here in Argentina who's my age or older lost three quarters of the savings in their bank accounts 23 years ago, because the government took it by converting dollars to pesos at the 1:1 pegged exchange rate and then dropping the peg. In a cryptocurrency wallet (a real one, not an exchange like Mt.Gox, Coinbase, or Binance) they wouldn't have lost anything. Another case is when a foreign government puts you on a sanctions list and freezes your assets in the banks under their jurisdiction. This has happened to a lot of Russians and Russian companies in the last few years. (It also happened to the foreign reserves of the Russian central bank, but Bitcoin is not liquid enough to be a significant international reserve asset.) Another case is when the government suspects you of some kind of wrongdoing but can't physically find you, or can find you but for whatever reason isn't willing to torture you. For example, two and a half years ago, some truckers in Canada staged a protest for misguided reasons, and the Canadian government of Justin Trudeau froze not only the truckers' bank accounts, and the organizers' bank accounts, but even bank accounts suspected to belong to people who were suspected of donating to the protest: https://www.cato.org/blog/emergencies-act-after-two-years https://www.cato.org/blog/emergencies-act-after-two-years https://www.newsweek.com/banks-have-begun-freezing-accounts-linked-trucker-protest-1680649 https://www.newsweek.com/banks-have-begun-freezing-accounts-... https://nationalpost.com/news/politics/bureaucrats-who-froze-bank-accounts-of-freedom-convoy-leaders-werent-trying-to-get-at-the-family https://nationalpost.com/news/politics/bureaucrats-who-froze... > In freezing the bank accounts of Freedom Convoy protesters, Finance Canada bureaucrats said they did not intend to hurt protesters’ families’ ability to buy groceries or pay child support, though they admitted that may have ultimately happened, the Emergencies Act inquiry heard Thursday. (...) Two weeks ago, some Freedom Convoy organizers testified their spouses were cut off from their money and couldn’t make vehicle payments or purchase groceries and medication because joint bank accounts were frozen. Earlier this year, a court found that the government's actions at the time were illegal. https://freespeechunion.org/trudeau-government-not-justified-in-freezing-protesters-bank-accounts-court-rules/ https://freespeechunion.org/trudeau-government-not-justified... explains: > In pursuing this novel form of politically motivated financial censorship, Prime Minister Trudeau was following in the footsteps of Russian President Vladmir Putin, who in 2019 ordered his government to freeze bank accounts linked to opposition politician Alexei Navalny. And of course it's well known that, when Wikileaks was targeted by the US government for their journalism, Visa and Mastercard cut off their donations despite apparently having no legal requirement to do so, while Bitcoin donations were able to continue. This was crucial in enabling Wikileaks to support Snowden's escape from the US when he revealed the extent of the US's illegal spying on its own citizens.
kerbs 2y ago
You made a subtle, but important, pivot from the topic of “Bitcoin” to the broader topic of “crypto”. Bitcoin specifically, with its multi-trillion dollar market cap, is built up that high purely on speculation. It is a very fragile store of wealth, especially the higher its market cap becomes.

superfist 2y ago

and how much of gold price is in your opinion value of material itself? Strip out that material price and you have speculation price. Price of Bitcoin is mostly that speculation price + instead of material some mathematical properties.

lottin 2y ago
> Price of Bitcoin is mostly that speculation price + instead of material some mathematical properties. Mathematical properties don't provide economic value. The demand for bitcoin is almost all speculation, and a tiny bit is for purposes of making clandestine payments, paying ransoms, and such.
- superfist 2y ago
  So, access to a permissionless SWIFT-like system from anywhere around the world has no economic value in your opinion? Go and ask people in African countries what it means to them.
  - lottin 2y ago
    I said _mathematical properties_ have no economic value.
    - superfist 2y ago
      Most paper money intrinsically has no value at all, even the paper it is printed on can't be used as toilet paper due to its lack of softness. It is only a medium of labor exchange. For me, Bitcoin is exactly the same, but in a very new form, backed by math instead of a government.
      - lottin 2y ago
        You're quite right that neither fiat money nor bitcoin have intrinsic value, though they both have exchange value (i.e. market value). This means there must be a demand that prevents the market value from falling to zero. In the case of fiat currency, the public demands fiat currency for transaction purposes and to pay taxes. In the case of bitcoin, the demand for transaction purposes is anecdotal, almost nonexistent. So the demand for bitcoin is almost entirely speculative. (There's no other possibility as far as I know, given no intrinsic value.) In other words, people demand bitcoin because they expect that the price of bitcoin will go up. Such a demand can be sustained as long as people continue to have the same expectations. When (or if) these expectations change, the demand can evaporate quite quickly, and the price will collapse dramatically as a result. So bitcoin is not backed by math. It's backed by a speculative demand.

chairmansteve 2y ago

BTC is used for trade. You know, drugs etc. And money laundering. Sanctions busting. Tax avoidance. It has a lot of utility...

lesuorac 2y ago
BTC is pretty bad for illegal activity since the transactions are public. You'd be much better off using the US Dollar. Even if it's through a bank like HSBC.
kerbs 2y ago
It is used for those things I agree. Those things alone do not hold up a $1.5T market cap. I would say they don’t hold up a $1.5B cap either.