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Of course not. No one said they were banning bitcoin. They have relegated it to a digital barter similar to other digital points like those used in World of War

by lingben 13y ago

Of course not. No one said they were banning bitcoin. They have relegated it to a digital barter similar to other digital points like those used in World of Warcraft or SecondLife's LindeX. What they have done is to shut it out completely from the formal Chinese banking and financial system. So much for the debate about bitcoin being a currency!

pault 13y ago
There are 2.5 billion adults walking the earth right now with no access to bank accounts[1]. I don't know what the "actual" value of bitcoin is, and I don't know if it will win the cryptocurrency race, but I am pretty confident that about a third of the population of the world will have a cryptocurrency wallet before they have a bank account. This is A Big Deal. Electricity is certainly an issue for many of those, but plunging hardware prices on smartphones and wireless internet access will allow them to skip checking accounts and go directly to a global financial network, just as many in the developing world had access to cell phones before land lines. At some point in the next few years, some entrepreneurial kid in some dirt poor corner of the world is going to become relatively wealthy via cryptocurrency; something that just isn't possible without a decentralized financial system. That's when I'll know we've hit the tipping point. [1](http://econ.worldbank.org/external/default/main?pagePK=64165259&theSitePK=469372&piPK=64165421&menuPK=64166093&entityID=000158349_20120419083611 http://econ.worldbank.org/external/default/main?pagePK=64165...)
- lingben 13y ago
  This is lunacy at its finest. Those that have no access to bank accounts live in third world countries. Bitcoin pre-supposes that the user have access to a computer either stationary or mobile (cell phone, tablet, etc.) with access to the internet. So what proponents of this idea are saying is that bitcoin will somehow, magically?, provide these people with not only the know-how of how to use a cryptocurrency but also provide them with these three indispensable resources: electricity (dependable and stable) internet (dependable and stable) computer (mobile or not) ...all before they can then turn around and use bitcoin. And that the central bank and government of said country will stand aside and relegate its monetary system and control to an outside force.
  - pault 13y ago
    Give it a few years (infographic for the lazy): http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTINFORMATIONANDCOMMUNICATIONANDTECHNOLOGIES/0,,contentMDK:23242710~pagePK:210058~piPK:210062~theSitePK:282823,00.html http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTINFORMATI... EDIT: to address your last point, I don't believe that it is within the power of any but the most sophisticated central governments to prevent adoption of a decentralized financial network. Look at the history of file sharing and bitcoin drug markets, for example. Every regulatory action creates evolutionary pressure on the network, and the succeeding services become more difficult to suppress.
    - lingben 13y ago
      Yes, this is general knowledge. But what you are asserting is a non-sequitur because you are assuming a direct link from adoption of cell-phones in third world countries to the adoption and use of bitcoin as a currency.
      - pault 13y ago
        I was addressing three of your previous points–electricity, internet, computer. I don't see these as issues, and to assume that cryptocurrency will remain as under-serviced and difficult to use as it currently is would be remarkably shortsighted.
        logfromblammo 13y ago
        They are even less problematic when you consider them in comparison with the infrastructure required for physical currency banking: vaults, guards, armored cars, auditors, trust, communications. When everyone already has the ability to use a cellular phone, the additional marginal resources required for using cryptocurrency are almost trivial. The way most banks operate, they would need electricity, Internet, and computers in all of their branch locations anyway. If you have neither traditional banking nor cryptocurrency, aiming for the latter offers a bigger return on your infrastructure investment.
    - 13y ago
ErikAugust 13y ago
"So much for the debate about bitcoin being a currency!" This is a ridiculous statement. China's current stance on BitCoin doesn't close the debate about it being a currency.
spenvo 13y ago
Sorry in advance for this wall of text and the redundant use of the word "currency." It makes for a shitty read, but I couldn't find a better way to construct my comment. All joking aside [0], you seem a little over eager to discount Bitcoin in this regard. Here's my take on BTC's relevance as a currency: - Its 'success' as a currency in the developed world (in the way we use greenbacks & fiat / Chinese use Yuan in daily life) ... ... on this point, I've never been too hopeful. [1] This definition of "success" is biased by most of our developed-world perspective. . tldr; - It will likely become 'relevant' without becoming a 'success' in the Western/1st-world sense. . Observations on why Bitcoin will struggle to become a ubiquitous currency: 1.) This statement from the PBOC - more or less negates its chances in China as being a "first-class citizen" (status) currency. This comes as no major surprise to me. But, what is surprising is the portion which reaffirmed the legality of the participation in Bitcoin in China ("... Bitcoin transaction as a commodity trading behavior on the Internet, ordinary people have the freedom to participate in the premise of own risk."), as you alluded to in your comment. This more than "leaves the door open." That said, the factors which contributed to this approach are unbelievably complex and probably nefarious (w/regards to BTC's future). 2.) In the USA, I don't see a pressing need for it to be used in the way we know dollars to be used. The reason here is that we have a historically stable system in place. 3.) The volatility of Bitcoin is not, and likely will never be, as stable as most of the fiat units in circulation. This would discourage me from paying my employees in Bitcoin. 4.) Since day one, we have all been apprehensive about the deflationary nature of the currency -- expressing the Keynesian-concern that spending in an economy is vital to the prosperity of said economy. . With that being said, here is where-and-why I'm long ... I.) ... because of the international nature of the protocol, one must think about those living in Iran, Zimbabwe, Argentina, Russia, etc.. In those places, I think it has legs as a currency, regardless of state-endorsement. Some of these states in crisis may even endorse Bitcoin. I believe that perfection isn't sought after in the 3rd world, as confidence has been lost in the fiat systems in place. (This is the reason why greenbacks are so ubiquitous abroad.) There's also a palpable anti-American sentiment in the third world that could discourage greenbacks' usage by the layman if there were a viable and universally accepted alternative. But paper greenbacks don't play well with the internet. Bitcoins do. One can argue that you could still use greenbacks digitally abroad, but this is not without large transaction fees, and -- in the case of unstable countries -- there may uncertainty in the bank which is facilitating the financial services. II.) ... it's nature has melded the idea of a cash dollar and a digital dollar into a decentralized, ephemeral-yet-"trustworthy" protocol. I can honestly say: I'd be a fool if I claimed to have the slightest idea how Bitcoin will innovate and make itself useful as a currency. So, I actually believe that Bitcoin has relevance as a currency, just not in a way that would make sense to the developed world. The above is part-and-parcel from Bitcoins as a store of value and other financial novelties, which I don't really have the time to enumerate. [0] - "So much for the debate about bitcoin being a currency!" [1] - [and it saddens me greatly, because I'm a Bitcoin fanboy, and I've believed since the early days that Bitcoin is special in many other ways. And no, I'm not a Bitcoin millionaire.] If you enjoyed this comment - I am releasing a Bitcoin-related service in ten days, and, in the idealistic spirit of Hacker News, I kindly encourage you to add me to Google+ or Twitter, so that you can offer early feedback. @spencenow or https://plus.google.com/+SpencerDailey https://plus.google.com/+SpencerDailey Thanks! :)
ChrisClark 13y ago
It's strange, because the government run China Telecom is letting you pre-order a phone with bitcoin.

by lingben 13y ago

pault 13y ago

There are 2.5 billion adults walking the earth right now with no access to bank accounts[1]. I don't know what the "actual" value of bitcoin is, and I don't know if it will win the cryptocurrency race, but I am pretty confident that about a third of the population of the world will have a cryptocurrency wallet before they have a bank account. This is A Big Deal. Electricity is certainly an issue for many of those, but plunging hardware prices on smartphones and wireless internet access will allow them to skip checking accounts and go directly to a global financial network, just as many in the developing world had access to cell phones before land lines. At some point in the next few years, some entrepreneurial kid in some dirt poor corner of the world is going to become relatively wealthy via cryptocurrency; something that just isn't possible without a decentralized financial system. That's when I'll know we've hit the tipping point. [1](http://econ.worldbank.org/external/default/main?pagePK=64165259&theSitePK=469372&piPK=64165421&menuPK=64166093&entityID=000158349_20120419083611 http://econ.worldbank.org/external/default/main?pagePK=64165...)

lingben 13y ago
This is lunacy at its finest. Those that have no access to bank accounts live in third world countries. Bitcoin pre-supposes that the user have access to a computer either stationary or mobile (cell phone, tablet, etc.) with access to the internet. So what proponents of this idea are saying is that bitcoin will somehow, magically?, provide these people with not only the know-how of how to use a cryptocurrency but also provide them with these three indispensable resources: electricity (dependable and stable) internet (dependable and stable) computer (mobile or not) ...all before they can then turn around and use bitcoin. And that the central bank and government of said country will stand aside and relegate its monetary system and control to an outside force.
- pault 13y ago
  Give it a few years (infographic for the lazy): http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTINFORMATIONANDCOMMUNICATIONANDTECHNOLOGIES/0,,contentMDK:23242710~pagePK:210058~piPK:210062~theSitePK:282823,00.html http://web.worldbank.org/WBSITE/EXTERNAL/TOPICS/EXTINFORMATI... EDIT: to address your last point, I don't believe that it is within the power of any but the most sophisticated central governments to prevent adoption of a decentralized financial network. Look at the history of file sharing and bitcoin drug markets, for example. Every regulatory action creates evolutionary pressure on the network, and the succeeding services become more difficult to suppress.
  - lingben 13y ago
    Yes, this is general knowledge. But what you are asserting is a non-sequitur because you are assuming a direct link from adoption of cell-phones in third world countries to the adoption and use of bitcoin as a currency.
    - pault 13y ago
      I was addressing three of your previous points–electricity, internet, computer. I don't see these as issues, and to assume that cryptocurrency will remain as under-serviced and difficult to use as it currently is would be remarkably shortsighted.
      - logfromblammo 13y ago
        They are even less problematic when you consider them in comparison with the infrastructure required for physical currency banking: vaults, guards, armored cars, auditors, trust, communications. When everyone already has the ability to use a cellular phone, the additional marginal resources required for using cryptocurrency are almost trivial. The way most banks operate, they would need electricity, Internet, and computers in all of their branch locations anyway. If you have neither traditional banking nor cryptocurrency, aiming for the latter offers a bigger return on your infrastructure investment.
  - 13y ago

ErikAugust 13y ago

"So much for the debate about bitcoin being a currency!" This is a ridiculous statement. China's current stance on BitCoin doesn't close the debate about it being a currency.

spenvo 13y ago

Sorry in advance for this wall of text and the redundant use of the word "currency." It makes for a shitty read, but I couldn't find a better way to construct my comment. All joking aside [0], you seem a little over eager to discount Bitcoin in this regard. Here's my take on BTC's relevance as a currency: - Its 'success' as a currency in the developed world (in the way we use greenbacks & fiat / Chinese use Yuan in daily life) ... ... on this point, I've never been too hopeful. [1] This definition of "success" is biased by most of our developed-world perspective. . tldr; - It will likely become 'relevant' without becoming a 'success' in the Western/1st-world sense. . Observations on why Bitcoin will struggle to become a ubiquitous currency: 1.) This statement from the PBOC - more or less negates its chances in China as being a "first-class citizen" (status) currency. This comes as no major surprise to me. But, what is surprising is the portion which reaffirmed the legality of the participation in Bitcoin in China ("... Bitcoin transaction as a commodity trading behavior on the Internet, ordinary people have the freedom to participate in the premise of own risk."), as you alluded to in your comment. This more than "leaves the door open." That said, the factors which contributed to this approach are unbelievably complex and probably nefarious (w/regards to BTC's future). 2.) In the USA, I don't see a pressing need for it to be used in the way we know dollars to be used. The reason here is that we have a historically stable system in place. 3.) The volatility of Bitcoin is not, and likely will never be, as stable as most of the fiat units in circulation. This would discourage me from paying my employees in Bitcoin. 4.) Since day one, we have all been apprehensive about the deflationary nature of the currency -- expressing the Keynesian-concern that spending in an economy is vital to the prosperity of said economy. . With that being said, here is where-and-why I'm long ... I.) ... because of the international nature of the protocol, one must think about those living in Iran, Zimbabwe, Argentina, Russia, etc.. In those places, I think it has legs as a currency, regardless of state-endorsement. Some of these states in crisis may even endorse Bitcoin. I believe that perfection isn't sought after in the 3rd world, as confidence has been lost in the fiat systems in place. (This is the reason why greenbacks are so ubiquitous abroad.) There's also a palpable anti-American sentiment in the third world that could discourage greenbacks' usage by the layman if there were a viable and universally accepted alternative. But paper greenbacks don't play well with the internet. Bitcoins do. One can argue that you could still use greenbacks digitally abroad, but this is not without large transaction fees, and -- in the case of unstable countries -- there may uncertainty in the bank which is facilitating the financial services. II.) ... it's nature has melded the idea of a cash dollar and a digital dollar into a decentralized, ephemeral-yet-"trustworthy" protocol. I can honestly say: I'd be a fool if I claimed to have the slightest idea how Bitcoin will innovate and make itself useful as a currency. So, I actually believe that Bitcoin has relevance as a currency, just not in a way that would make sense to the developed world. The above is part-and-parcel from Bitcoins as a store of value and other financial novelties, which I don't really have the time to enumerate. [0] - "So much for the debate about bitcoin being a currency!" [1] - [and it saddens me greatly, because I'm a Bitcoin fanboy, and I've believed since the early days that Bitcoin is special in many other ways. And no, I'm not a Bitcoin millionaire.] If you enjoyed this comment - I am releasing a Bitcoin-related service in ten days, and, in the idealistic spirit of Hacker News, I kindly encourage you to add me to Google+ or Twitter, so that you can offer early feedback. @spencenow or https://plus.google.com/+SpencerDailey https://plus.google.com/+SpencerDailey Thanks! :)

ChrisClark 13y ago

It's strange, because the government run China Telecom is letting you pre-order a phone with bitcoin.