6 ms·

A China Triangle: Bitcoin, Baidu, And Beijing

54 points by angelohuang 13y ago

deleted 13y ago
[deleted]
gbog 13y ago
Interesting article overall, but: "it is inconceivable that Baidu would permit the acceptance of Bitcoins without first clearing the matter with Beijing authorities" It do not seem to be what suggested Kaiser Kuo http://qr.ae/GsjwK http://qr.ae/GsjwK and it should be noted that Baidu is a bunch of small sized teams competing each other fiercly. Accepting Bitcoin could very well be decided locally, and the risk would be localized. Even if the higher instances in Baidu or higher have heard of it, they probably won't have endorsed it officially and will be able to say they didn't know. I would be extremely surprised if the Chinese government would be very open-minded with bitcoins and would suspect an hidden agenda behind. Why? Because from all what we know of Bitcoin and its use, it allows bypassing a lot of controls, and even threaten directly the life and blood of any government on Earth: the taxes.
- adventured 13y ago
  Bitcoin doesn't threaten taxes at all. It would be like suggesting that taxes didn't work in the age of cash transactions (eg for the first 200 years of US history). Primarily it threatens fiat-based Keynesian economics by making it impossible to inflate away savings / wealth / standard of living as a means of government deficit financing. To the extent a government is dependent on devaluing their currency to remain afloat or otherwise pretend to be better off than they are (eg paying for entitlements with inflation), is the extent to which bitcoin would be a threat with wide-scale adoption.
  - iSnow 13y ago
    As long as the Gov't has authority what asset it accepts for tax payments, legal tender as issued by the central bank is in no danger. Since in industrialized nations taxes make up a large part of the GNI, I cannot see XBT dethroning national currencies. The usual inflation of traditional currencies would predictably lead to a deflationary spiral in XBT until it either hits a ceiling or goes into extremely fast boom and bust cycles that kill trust. Everyone who tried to evade the debasement of his savings by 2% inflation only to witness them melting 50% in the next XBT bubble pop will be hesitant to go there again - especially if the market get so narrow that selling is a real problem.
- ximeng 13y ago
  Thanks gbog. To what extent is Baidu just small teams? I would have thought there should be at least a central core team for search? That link using the HN link shortener: http://www.quora.com/Bitcoin/What-will-Baidu-and-Bitcoin-accomplish-together/answer/Kaiser-Kuo?srid=uB5V&share=1 http://www.quora.com/Bitcoin/What-will-Baidu-and-Bitcoin-acc...
jackgavigan 13y ago
Even the most oppressive governments can't monitor or trace payments made with physical cash. But tracing Bitcoins is easy, thanks to the blockchain. I wouldn't be surprised if there is a sudden crackdown, in which BTC China's records are seized and used to identify individuals who are using Bitcoin to shift money overseas. In fact, who's to say it's not happening already?
- wisty 13y ago
  I can think of one good reason why the government wouldn't want to do that - because it's the people running the government who are using it to transfer public money to their overseas bank accounts. Obviously not all of them (there's more common methods, and not all of them are on the take), but enough to make it a bad idea to go fishing for money launderers. They don't want to catch anyone unless they already know who they are going to catch. I suspect this is also a factor in why it is taking them so long to unify their land ownership databases.
  - jackgavigan 13y ago
    > ..it's the people running the government who are using it to transfer public money to their overseas bank accounts. I really doubt that. People "running the government" are far more likely to use pseudo-legitimate methods of transferring their wealth overseas (i.e. methods that are not available to anyone who doesn't inhabit the corridors of power) than Bitcoin. No, the people transferring wealth via Bitcoin will be in the emerging middle class demographic, not the the ruling class. Besides, if someone with political clout were to be identified as a Bitcoin launderer, it's likely that the evidence would simply be "lost". It's far more likely that the authorities would selectively prosecute those who they wished to imprison for other reasons.
- bernatfp 13y ago
  In these cases, use of CoinJoin is encouraged.
  - jackgavigan 13y ago
daniel-cussen 13y ago
My take on China's embrace of Bitcoin is not that it will help it with police-statesmanship, but simply that they really don't like the USG dollar, and would love if the international monetary system made a little more sense. Right now, Japan, Germany, and China (mostly) buy enormous amounts of US treasuries at tiny/negative interest, only to see them defaulted on little by little at the pace of inflation (which is of course paced by the USG). China doesn't really believe in fiat currency, definitely not at the state level. They should know, they invented paper currency back in the day. Instead, they buy precious metals (and other metals, they stockpiled copper during the gold boom a few years back), and I think they see something very similar when they look at Bitcoin. They see gold 2.0, at any rate, a contender to become the world's reserve currency, only with better liquidity than gold, less inflation (you can mind more gold into existence, but Bitcoin is capped at 21 million), and harder to forge.

54 points by angelohuang 13y ago

deleted 13y ago

[deleted]

gbog 13y ago

Interesting article overall, but: "it is inconceivable that Baidu would permit the acceptance of Bitcoins without first clearing the matter with Beijing authorities" It do not seem to be what suggested Kaiser Kuo http://qr.ae/GsjwK http://qr.ae/GsjwK and it should be noted that Baidu is a bunch of small sized teams competing each other fiercly. Accepting Bitcoin could very well be decided locally, and the risk would be localized. Even if the higher instances in Baidu or higher have heard of it, they probably won't have endorsed it officially and will be able to say they didn't know. I would be extremely surprised if the Chinese government would be very open-minded with bitcoins and would suspect an hidden agenda behind. Why? Because from all what we know of Bitcoin and its use, it allows bypassing a lot of controls, and even threaten directly the life and blood of any government on Earth: the taxes.

adventured 13y ago
Bitcoin doesn't threaten taxes at all. It would be like suggesting that taxes didn't work in the age of cash transactions (eg for the first 200 years of US history). Primarily it threatens fiat-based Keynesian economics by making it impossible to inflate away savings / wealth / standard of living as a means of government deficit financing. To the extent a government is dependent on devaluing their currency to remain afloat or otherwise pretend to be better off than they are (eg paying for entitlements with inflation), is the extent to which bitcoin would be a threat with wide-scale adoption.
- iSnow 13y ago
  As long as the Gov't has authority what asset it accepts for tax payments, legal tender as issued by the central bank is in no danger. Since in industrialized nations taxes make up a large part of the GNI, I cannot see XBT dethroning national currencies. The usual inflation of traditional currencies would predictably lead to a deflationary spiral in XBT until it either hits a ceiling or goes into extremely fast boom and bust cycles that kill trust. Everyone who tried to evade the debasement of his savings by 2% inflation only to witness them melting 50% in the next XBT bubble pop will be hesitant to go there again - especially if the market get so narrow that selling is a real problem.
ximeng 13y ago
Thanks gbog. To what extent is Baidu just small teams? I would have thought there should be at least a central core team for search? That link using the HN link shortener: http://www.quora.com/Bitcoin/What-will-Baidu-and-Bitcoin-accomplish-together/answer/Kaiser-Kuo?srid=uB5V&share=1 http://www.quora.com/Bitcoin/What-will-Baidu-and-Bitcoin-acc...

jackgavigan 13y ago

Even the most oppressive governments can't monitor or trace payments made with physical cash. But tracing Bitcoins is easy, thanks to the blockchain. I wouldn't be surprised if there is a sudden crackdown, in which BTC China's records are seized and used to identify individuals who are using Bitcoin to shift money overseas. In fact, who's to say it's not happening already?

wisty 13y ago
I can think of one good reason why the government wouldn't want to do that - because it's the people running the government who are using it to transfer public money to their overseas bank accounts. Obviously not all of them (there's more common methods, and not all of them are on the take), but enough to make it a bad idea to go fishing for money launderers. They don't want to catch anyone unless they already know who they are going to catch. I suspect this is also a factor in why it is taking them so long to unify their land ownership databases.
- jackgavigan 13y ago
  > ..it's the people running the government who are using it to transfer public money to their overseas bank accounts. I really doubt that. People "running the government" are far more likely to use pseudo-legitimate methods of transferring their wealth overseas (i.e. methods that are not available to anyone who doesn't inhabit the corridors of power) than Bitcoin. No, the people transferring wealth via Bitcoin will be in the emerging middle class demographic, not the the ruling class. Besides, if someone with political clout were to be identified as a Bitcoin launderer, it's likely that the evidence would simply be "lost". It's far more likely that the authorities would selectively prosecute those who they wished to imprison for other reasons.
bernatfp 13y ago
In these cases, use of CoinJoin is encouraged.
- jackgavigan 13y ago

daniel-cussen 13y ago

My take on China's embrace of Bitcoin is not that it will help it with police-statesmanship, but simply that they really don't like the USG dollar, and would love if the international monetary system made a little more sense. Right now, Japan, Germany, and China (mostly) buy enormous amounts of US treasuries at tiny/negative interest, only to see them defaulted on little by little at the pace of inflation (which is of course paced by the USG). China doesn't really believe in fiat currency, definitely not at the state level. They should know, they invented paper currency back in the day. Instead, they buy precious metals (and other metals, they stockpiled copper during the gold boom a few years back), and I think they see something very similar when they look at Bitcoin. They see gold 2.0, at any rate, a contender to become the world's reserve currency, only with better liquidity than gold, less inflation (you can mind more gold into existence, but Bitcoin is capped at 21 million), and harder to forge.