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Freedom is a terrifying thing to people who have a naturally authoritarian mindset. I don't personally believe that Bitcoin is the road to some techno-utopia.

Freedom is a terrifying thing to people who have a naturally authoritarian mindset. I don't personally believe that Bitcoin is the road to some techno-utopia. Frankly, I expect that ultimately it will just be a blip on the radar; but there's no reason to get so angry about it unless its fundamentally a scary idea. Its a direct challenge to the authoritarian worldview and that's frightening.

deleted 13y ago
[deleted]
msandford 13y ago
That's really insightful. Well put.
kevingadd 13y ago
I don't think it's accurate to characterize the OP as criticizing (or being terrified by, for that matter) the freedom offered by Bitcoin as if freedom is a bad thing. Rather, he argues (somewhat convincingly) that the freedom offered by Bitcoin is of most value to the people who are already rich enough (either in time, resources, or USD) to profit from speculation, asic mining, and other aspects of the Bitcoin market. The freedom provided by this new financial system does nothing to enrich the people who are imperiled by the existing financial system; quite the opposite, the lack of regulations endangers them because they are not highly educated, rational financiers so they have increased exposure to risk/fraud.
- nostromo 13y ago
  I don't find it convincing at all. When I was in college, I hated banks. Once I bought a cup of coffee for $2 only to find I had racked up $40 worth of NSF fees accidentally. I'm sure this happens to poor folks all the time. Poor people often don't use banks because banks prey on the poor and often make them poorer. Why didn't I just use cash? Because I wanted to buy things online, accept payments from others, and didn't want to carry cash around all the time. If Bitcoin was less volatile, it would actually do a good job of solving some of the issues faced by poorer "underbanked" people.
  - kevingadd 13y ago
    I'm with you on all the stuff about why banks are awful. They are awful. The problem is that it is an incredibly difficult leap to even imagine a potential universe where Bitcoin is better for the people currently victimized by banks. At present, it is massively, catastrophically worse for them. The volatility is only one of a numerous set of problems that apply there. I'm still interested to see how it will get used to solve real problems, but the protocol itself is at best a single tool that can be used to construct a system that actually helps the poor and the underbanked.
    - baddox 13y ago
      > At present, it is massively, catastrophically worse for them. It has been less than four years since Bitcoin was invented. Looking at every major invention at age four, how many of them would be unequivocal successes for the group of people that eventually benefitted? Four years after the invention of computer networking, I'm sure computer networks were much worse than libraries for people doing research projects. Likewise with automobiles and travelers, airplanes and travelers, etc.
  - comrade_ogilvy 13y ago
    That sounds exactly like the kind of wishful thinking the OP is railing against. For "retail" folk who are having trouble navigating through regular life without getting screwed by their regular bank account, what does bitcoin offer? Less than nothing. Bitcoins may have their uses, but it is primarily an advantage to very sophisticated persons (or criminals).
  - smtddr 13y ago
    >>If Bitcoin was less volatile, it would actually do a good job of solving some of the issues faced by poorer "underbanked" people. Bitcoin won't help poor people _directly_, but when it stabilizes I can think of at least a few ways it can help them indirectly. Another start-up company with a bitcoin backend challenging Western Union. All the not-wealthy immigrants who want to send money home without western-union's fees. Or maybe even bitcoin credit cards? Avoid the whole Visa/MasterCard infrastructure and whatever fees/rules it has. Of course, I still don't know how to deal with fraud & chargebacks..... so....
- baddox 13y ago
  I think there are several vastly different levels of "rich people." While I think Bitcoin right now mostly benefits the middle class with disposable income, I also think it is, at least conceptually, a huge threat to the very rich, specifically the people in the financial sector whose wealth comes from their close ties with the governments that control the world's monetary systems and economies.
  - kevingadd 13y ago
    Technically the only way Bitcoin can threaten the very rich is if it directly undermines the value of their assets. How exactly will it do that if, right now, any one of them can sink a huge amount of USD into amassing a Bitcoin stockpile (either by buying lots of ASICs or buying them directly)? There are literal examples of this already - the Winklevoss twins have claimed to own over 1% of all Bitcoins, effectively converting some of their massive USD wealth into BTC. Even if you were to undermine the existing monetary systems, any rich person that saw it coming would easily be able to amass a giant BTC stockpile and ride it out. In that scenario, they would not stand to lose very much in a BTC transition, as long as they saw it coming before USD's value was completely destroyed. The 'very rich' can afford to spend extravagantly to acquire bitcoins, and can afford to do so at 'a loss' if they actually have some good reason to convert money from other currencies to BTC. The average poor or middle-class person who has bitcoins to sell will be unlikely to turn down an offer to buy BTC at above market prices or similar other arrangements. You can argue that Bitcoin is a threat to the revenue streams that the 'very rich' rely on to become wealthy and stay wealthy; however, it is mostly a threat in that it displaces those revenue streams. Speculators that currently work in things tied to USD can just as easily do their speculation against BTC; you do nothing to put those people out of work. Investors, likewise, are not somehow directly threatened by a Bitcoin-based economy. It's just currency to them.
    - baddox 13y ago
      Why do you think banks and governments have been so hostile to Bitcoin? Do you think it is the desire to protect the citizens for their own good, or is it to maintain control? For a quick benchmark, I would also ask a similar question: why do you think the US government spies on its citizens?
baddox 13y ago
People don't just tolerate government, or think it's necessary, or even appreciate government. Most people in the world love government, and respond passionately against any perceived threat to the existence or steady growth of government. Government is in first place, ahead of organized religion, in the race to obtain the most passionate, unquestioning, dedicated followers.
- dragonwriter 13y ago
  Most people neither love nor hate "government" particularly, rather, they take it for granted as an essential feature of society and have preference for what it does and does not do. There are some people who are genuinely anti-government, and more people who are against government doing particular, broadly popular things and find it easier to adopt a rhetorical "anti-government" stance in advocating against these function than to advocate against them specifically. On the other side, people rarely -- either honestly or as rhetorical cover for another position -- advocate for government qua government, rather than for particular government action. This suggests that people tend to have a, if any opinion on government as a general thing, a negative opinion, which can be more positive when it comes to particular government actions.
  - baddox 13y ago
    I disagree. I really do think that most people have a deep love for government, or at least their own government. People love taxes (although they often think the taxes on themselves are too high), they consider government to be virtuous ("who would take care of the poor without government"), and they believe that (and are grateful that) they are completely dependent on government for their own welfare and safety. It's not surprising, given the large amount of resources that governments spend on making people love government. Now obviously I'm not saying that people are for any type of government or any specific action of government. But most people will adamantly defend the goodness and necessity of government in the face of any undesirable action or aspect of a particular government. It's very common to hear phrases like "democracy isn't perfect, but it's the best system there is," or "if you don't like something, you can vote to change it," or "government represents the people," etc.
sentenza 13y ago
IMO, what gets people raging against bitcoin (me included), is that it has "that smell". By this I mean a certain likeness to many other speculative schemes that came before. I remember reading somewhere that Groucho Marx had lost a significant portion of his assets in the stock market in the 20s, because he had invested without knowing what he was doing at a time when everybody was investing without knowing what they were doing. The tone of much of the writings these days that push Bitcoins leads me to believe that we might be heading in a similar direction with Bitcoin. Now imagine yourself in the position of a person that thinks as I do. Wouldn't you say that some of the hurrah-praise of Bitcoin in technology corner to me might reek of hubris? Too many people wanting to get rich quick. Too much fluctuation. Too much speculation.
- baddox 13y ago
  But there's a big difference between advising against wistful investment in Bitcoin as if there's guaranteed payoffs, and denying that Bitcoin is a significant breakthrough in technology.
- philosophus 13y ago
  You could say the same thing about the dot com scene around 2000. It was overvalued, but that doesn't mean it had no value.
codelust 13y ago
Indulge me here for a bit; but how does a multi-million dollar investment (raised from the same existing authoritarian framework) into Bitcoins make it anti-authoritarian? Best case scenario is that this is a good hedge with decent risks, worst case scenario is that it is a worthwhile asset class to manipulate at a lower cost compared to other asset classes. EDIT: I don't agree with the larger tone of the article, but there are merit-worthy points that are made in it.
- thecoffman 13y ago
  I never claimed that Coinbase, the company you seem to be referring to, was anti-authoritarian: only that the idea of Bitcoin itself was. Coinbase is, as you said, very much a product of the existing framework. Bitcoin's creator satoshi wrote extensively about economics and politics and, to my understanding, its invention was explicitly anti-authoritarian.
  - codelust 13y ago
    But you do recognize that people are buying Bitcoins using the day-to-day authoritarian tools, right? This is the equivalent of popularization of denims as a statement of rebellion from the 1970s; or the prevalence of Che Guevara tees in capitalist nations. Gives you that warm fuzzy feeling, but, in reality, it is no different from anything else.
    - thecoffman 13y ago
      Of course. As bitcoin isn't a viable currency and no one is really conducting btc->btc transactions, paying salaries in btc or anything else, the only method of utilizing them is going through the traditional, already existing banking infrastructure. The only part that I may slightly disagree with is that unlike the case of denim or Che shirts, there is at least a theoretical endgame that escapes the traditional framework. Note that I don't think bitcoin will reach that endgame, but I think that is a slight distinction.
    - codelust 13y ago
      Replying to the reply to my parent comment, since I seem to have reached HN's nesting limit. Forms of control are not always very direct. Let us, hypothetically, say the big state actors jump in to take control of 80% of the available bitcoins available, under various entities, they have control and authority and little accountability. This is already a reality in some equity markets, where retail investors are under 20% and rest of the players are institutional players. It will take much lesser than what it takes to move a large equity market, to move BT. There is a good reason why there is no global barter system. It simply won't work at that scale. A global barter system -- that would be truly subversive.
pron 13y ago
See, to me, "freedom" from a democratically elected government (which is by no definition authoritarian) sounds more like good-old oppressive feudalism. It was far worse than anything a democratic government has ever done. I see a strong, regulating, democratic government as liberating me from oppressive corporations. And we're not talking about the middle ages. The US suffered greatly under the oppressive power of the robber barons only 100 years ago. People like Carnegie, Frick, Vanderbilt, J. P. Morgan and Rockefeller ruthlessly exploited an entire country, and it took a lot of effort and the courage of Teddy Roosevelt to free America from those people through regulation. I don't understand how people in a country freed from corporate oppression by government regulation a mere century ago can think that doing away with regulation can "free" you from anything.

deleted 13y ago

[deleted]

msandford 13y ago

That's really insightful. Well put.

kevingadd 13y ago

I don't think it's accurate to characterize the OP as criticizing (or being terrified by, for that matter) the freedom offered by Bitcoin as if freedom is a bad thing. Rather, he argues (somewhat convincingly) that the freedom offered by Bitcoin is of most value to the people who are already rich enough (either in time, resources, or USD) to profit from speculation, asic mining, and other aspects of the Bitcoin market. The freedom provided by this new financial system does nothing to enrich the people who are imperiled by the existing financial system; quite the opposite, the lack of regulations endangers them because they are not highly educated, rational financiers so they have increased exposure to risk/fraud.

nostromo 13y ago
I don't find it convincing at all. When I was in college, I hated banks. Once I bought a cup of coffee for $2 only to find I had racked up $40 worth of NSF fees accidentally. I'm sure this happens to poor folks all the time. Poor people often don't use banks because banks prey on the poor and often make them poorer. Why didn't I just use cash? Because I wanted to buy things online, accept payments from others, and didn't want to carry cash around all the time. If Bitcoin was less volatile, it would actually do a good job of solving some of the issues faced by poorer "underbanked" people.
- kevingadd 13y ago
  I'm with you on all the stuff about why banks are awful. They are awful. The problem is that it is an incredibly difficult leap to even imagine a potential universe where Bitcoin is better for the people currently victimized by banks. At present, it is massively, catastrophically worse for them. The volatility is only one of a numerous set of problems that apply there. I'm still interested to see how it will get used to solve real problems, but the protocol itself is at best a single tool that can be used to construct a system that actually helps the poor and the underbanked.
  - baddox 13y ago
    > At present, it is massively, catastrophically worse for them. It has been less than four years since Bitcoin was invented. Looking at every major invention at age four, how many of them would be unequivocal successes for the group of people that eventually benefitted? Four years after the invention of computer networking, I'm sure computer networks were much worse than libraries for people doing research projects. Likewise with automobiles and travelers, airplanes and travelers, etc.
- comrade_ogilvy 13y ago
  That sounds exactly like the kind of wishful thinking the OP is railing against. For "retail" folk who are having trouble navigating through regular life without getting screwed by their regular bank account, what does bitcoin offer? Less than nothing. Bitcoins may have their uses, but it is primarily an advantage to very sophisticated persons (or criminals).
- smtddr 13y ago
  >>If Bitcoin was less volatile, it would actually do a good job of solving some of the issues faced by poorer "underbanked" people. Bitcoin won't help poor people _directly_, but when it stabilizes I can think of at least a few ways it can help them indirectly. Another start-up company with a bitcoin backend challenging Western Union. All the not-wealthy immigrants who want to send money home without western-union's fees. Or maybe even bitcoin credit cards? Avoid the whole Visa/MasterCard infrastructure and whatever fees/rules it has. Of course, I still don't know how to deal with fraud & chargebacks..... so....
baddox 13y ago
I think there are several vastly different levels of "rich people." While I think Bitcoin right now mostly benefits the middle class with disposable income, I also think it is, at least conceptually, a huge threat to the very rich, specifically the people in the financial sector whose wealth comes from their close ties with the governments that control the world's monetary systems and economies.
- kevingadd 13y ago
  Technically the only way Bitcoin can threaten the very rich is if it directly undermines the value of their assets. How exactly will it do that if, right now, any one of them can sink a huge amount of USD into amassing a Bitcoin stockpile (either by buying lots of ASICs or buying them directly)? There are literal examples of this already - the Winklevoss twins have claimed to own over 1% of all Bitcoins, effectively converting some of their massive USD wealth into BTC. Even if you were to undermine the existing monetary systems, any rich person that saw it coming would easily be able to amass a giant BTC stockpile and ride it out. In that scenario, they would not stand to lose very much in a BTC transition, as long as they saw it coming before USD's value was completely destroyed. The 'very rich' can afford to spend extravagantly to acquire bitcoins, and can afford to do so at 'a loss' if they actually have some good reason to convert money from other currencies to BTC. The average poor or middle-class person who has bitcoins to sell will be unlikely to turn down an offer to buy BTC at above market prices or similar other arrangements. You can argue that Bitcoin is a threat to the revenue streams that the 'very rich' rely on to become wealthy and stay wealthy; however, it is mostly a threat in that it displaces those revenue streams. Speculators that currently work in things tied to USD can just as easily do their speculation against BTC; you do nothing to put those people out of work. Investors, likewise, are not somehow directly threatened by a Bitcoin-based economy. It's just currency to them.
  - baddox 13y ago
    Why do you think banks and governments have been so hostile to Bitcoin? Do you think it is the desire to protect the citizens for their own good, or is it to maintain control? For a quick benchmark, I would also ask a similar question: why do you think the US government spies on its citizens?

baddox 13y ago

People don't just tolerate government, or think it's necessary, or even appreciate government. Most people in the world love government, and respond passionately against any perceived threat to the existence or steady growth of government. Government is in first place, ahead of organized religion, in the race to obtain the most passionate, unquestioning, dedicated followers.

dragonwriter 13y ago
Most people neither love nor hate "government" particularly, rather, they take it for granted as an essential feature of society and have preference for what it does and does not do. There are some people who are genuinely anti-government, and more people who are against government doing particular, broadly popular things and find it easier to adopt a rhetorical "anti-government" stance in advocating against these function than to advocate against them specifically. On the other side, people rarely -- either honestly or as rhetorical cover for another position -- advocate for government qua government, rather than for particular government action. This suggests that people tend to have a, if any opinion on government as a general thing, a negative opinion, which can be more positive when it comes to particular government actions.
- baddox 13y ago
  I disagree. I really do think that most people have a deep love for government, or at least their own government. People love taxes (although they often think the taxes on themselves are too high), they consider government to be virtuous ("who would take care of the poor without government"), and they believe that (and are grateful that) they are completely dependent on government for their own welfare and safety. It's not surprising, given the large amount of resources that governments spend on making people love government. Now obviously I'm not saying that people are for any type of government or any specific action of government. But most people will adamantly defend the goodness and necessity of government in the face of any undesirable action or aspect of a particular government. It's very common to hear phrases like "democracy isn't perfect, but it's the best system there is," or "if you don't like something, you can vote to change it," or "government represents the people," etc.

sentenza 13y ago

IMO, what gets people raging against bitcoin (me included), is that it has "that smell". By this I mean a certain likeness to many other speculative schemes that came before. I remember reading somewhere that Groucho Marx had lost a significant portion of his assets in the stock market in the 20s, because he had invested without knowing what he was doing at a time when everybody was investing without knowing what they were doing. The tone of much of the writings these days that push Bitcoins leads me to believe that we might be heading in a similar direction with Bitcoin. Now imagine yourself in the position of a person that thinks as I do. Wouldn't you say that some of the hurrah-praise of Bitcoin in technology corner to me might reek of hubris? Too many people wanting to get rich quick. Too much fluctuation. Too much speculation.

baddox 13y ago
But there's a big difference between advising against wistful investment in Bitcoin as if there's guaranteed payoffs, and denying that Bitcoin is a significant breakthrough in technology.
philosophus 13y ago
You could say the same thing about the dot com scene around 2000. It was overvalued, but that doesn't mean it had no value.

codelust 13y ago

Indulge me here for a bit; but how does a multi-million dollar investment (raised from the same existing authoritarian framework) into Bitcoins make it anti-authoritarian? Best case scenario is that this is a good hedge with decent risks, worst case scenario is that it is a worthwhile asset class to manipulate at a lower cost compared to other asset classes. EDIT: I don't agree with the larger tone of the article, but there are merit-worthy points that are made in it.

thecoffman 13y ago
I never claimed that Coinbase, the company you seem to be referring to, was anti-authoritarian: only that the idea of Bitcoin itself was. Coinbase is, as you said, very much a product of the existing framework. Bitcoin's creator satoshi wrote extensively about economics and politics and, to my understanding, its invention was explicitly anti-authoritarian.
- codelust 13y ago
  But you do recognize that people are buying Bitcoins using the day-to-day authoritarian tools, right? This is the equivalent of popularization of denims as a statement of rebellion from the 1970s; or the prevalence of Che Guevara tees in capitalist nations. Gives you that warm fuzzy feeling, but, in reality, it is no different from anything else.
  - thecoffman 13y ago
    Of course. As bitcoin isn't a viable currency and no one is really conducting btc->btc transactions, paying salaries in btc or anything else, the only method of utilizing them is going through the traditional, already existing banking infrastructure. The only part that I may slightly disagree with is that unlike the case of denim or Che shirts, there is at least a theoretical endgame that escapes the traditional framework. Note that I don't think bitcoin will reach that endgame, but I think that is a slight distinction.
  - codelust 13y ago
    Replying to the reply to my parent comment, since I seem to have reached HN's nesting limit. Forms of control are not always very direct. Let us, hypothetically, say the big state actors jump in to take control of 80% of the available bitcoins available, under various entities, they have control and authority and little accountability. This is already a reality in some equity markets, where retail investors are under 20% and rest of the players are institutional players. It will take much lesser than what it takes to move a large equity market, to move BT. There is a good reason why there is no global barter system. It simply won't work at that scale. A global barter system -- that would be truly subversive.

pron 13y ago

See, to me, "freedom" from a democratically elected government (which is by no definition authoritarian) sounds more like good-old oppressive feudalism. It was far worse than anything a democratic government has ever done. I see a strong, regulating, democratic government as liberating me from oppressive corporations. And we're not talking about the middle ages. The US suffered greatly under the oppressive power of the robber barons only 100 years ago. People like Carnegie, Frick, Vanderbilt, J. P. Morgan and Rockefeller ruthlessly exploited an entire country, and it took a lot of effort and the courage of Teddy Roosevelt to free America from those people through regulation. I don't understand how people in a country freed from corporate oppression by government regulation a mere century ago can think that doing away with regulation can "free" you from anything.