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Fiat is Effective: fiat for the crypto crowd [pdf]

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Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#111

Post by Spivak »

lightbyte wrote: post #108
apo wrote: post #105

Earlier quoted context omitted.

Hey look, someone took the time to explain to cryptocurrency enthusiasts why the rest of us perceive money as working. Most knowledgeable cryto enthusiasts I know already know that fiat currencies work well enough for many people. Folks like McKenzie will see no value in Bitcoin and other cryptos because their money needs are already satisfied. Good for them, but their narrow perspective excludes many valid use cases…

>- civil asset forfeiture; How would cryptocurrencies prevent the police from seizing your private keys? They can already throw you in jail if you refuse to provide passwords, or the keys themselves.

Current situation: Government takes your money and you must sue to get it back.

Crypto: Government is incapable of taking your money and must prosecute in order to coerce you to turn it over. And you could still refuse and accept your jail time.

Edit: People replying to me are missing the point. This is about the case where the government is wrongfully taking your money. Under the current system your money can be seized without your knowledge and you have to prove it was taken wrongfully after the fact. With crypto the burden is shifted to the government who has to prove they have the right to seize it in the first place.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#112

Post by notyourday »

matt4077 wrote: post #54
urza wrote: post #19

So the argument basically comes down to that crypto is too volatile and not usable as unit of account? 1. Crypto is still in its initial stage, where capital is flowing into it. Once it is there, it will be less volatile. You can already see this in Bitcoin[1], where relative volatility is dropping every year. 2. There are projects coming that will enable decentralized trustless peg of fiat currencies into blockchian…

> keep bitcoin for your grandchildern instead of dolar that looses 95% value over century Whereas bitcoin has a proven track record of almost a decade of... existence? Anyway, why would anybody preserve value in cash over those time scales? The alternative isn't bitcoin or US$ or gold, it's stocks or bonds or real estate or fuck them let's spend it on blow.

Its like pink sheets. Don't tell people who are invested in pumping them that they are not investing into NASDAQ listed securities.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#113

Post by Jdam »

subroutine wrote: post #64

In the words of Patrick McKenzie's tweet linking to this pdf‏, "Hey look, someone took the time to explain to cryptocurrency enthusiasts why the rest of us perceive money as working". For those singing the praises of cryptocurrency I pose this question: Say the United States decides to allow decentralized cryptocurrencies to become the dominant medium of exchange in the US; say it even gets rid of the $USD. What prob…

> What problem do you think this would solve?

Exactly. I know a few local shops & bars that accept bitcoin. Although it sounds cool, I‘m always asking myself „why should I?“. It’s way more convenient to just throw some coins or put the Credit card on the reader for about 1 second to pay for my beer, instead of initiating a transaction on the distributed ledger.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#114

Post by notyourday »

jph wrote: post #4

Summary of key points: • The case against fiat is an ethical case, much more than an effectiveness case. Crytpo advocates often misunderstand this. * The primary reason fiat succeeds is it offers price stability. But stability is often purchased at the expense of workers and the unemployed. * The management of fiat provides state actors with incredibly powerful, ultimately discretionary, tools which significantly aff…

> The primary reason fiat succeeds is it offers price stability. But stability is often purchased at the expense of workers and the unemployed.

Fiat is successful because it is backed up by guys with lots of guns. The backers of the most successful ones have aircraft carriers, nuclear submarines, predator drones, etc.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#115

Post by pja »

apo wrote: post #105
subroutine wrote: post #64

In the words of Patrick McKenzie's tweet linking to this pdf‏, "Hey look, someone took the time to explain to cryptocurrency enthusiasts why the rest of us perceive money as working". For those singing the praises of cryptocurrency I pose this question: Say the United States decides to allow decentralized cryptocurrencies to become the dominant medium of exchange in the US; say it even gets rid of the $USD. What prob…

Hey look, someone took the time to explain to cryptocurrency enthusiasts why the rest of us perceive money as working. Most knowledgeable cryto enthusiasts I know already know that fiat currencies work well enough for many people. Folks like McKenzie will see no value in Bitcoin and other cryptos because their money needs are already satisfied. Good for them, but their narrow perspective excludes many valid use cases…

So essentially what you’re saying is that the unique value proposition of BitCoin is that it allows you to make payments that break the law in your jurisdiction.

I mean, I agree with you entirely: that is BitCoin’s unique value proposition. It’s just good to see it out on the table.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#116

Post by pja »

Spivak wrote: post #111
lightbyte wrote: post #108

Earlier quoted context omitted.

>- civil asset forfeiture; How would cryptocurrencies prevent the police from seizing your private keys? They can already throw you in jail if you refuse to provide passwords, or the keys themselves.

Current situation: Government takes your money and you must sue to get it back. Crypto: Government is incapable of taking your money and must prosecute in order to coerce you to turn it over. And you could still refuse and accept your jail time. Edit: People replying to me are missing the point. This is about the case where the government is wrongfully taking your money. Under the current system your money can be sei…

And you could still refuse and accept your jail time.

In most jurisdictions (including the US) the sanction for contempt of court is potentially unlimited: the convicted individual may find that they are only freed when they comply with the court’s requirements.

IOW, good luck with that.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#117

Post by moduspol »

subroutine wrote: post #64

In the words of Patrick McKenzie's tweet linking to this pdf‏, "Hey look, someone took the time to explain to cryptocurrency enthusiasts why the rest of us perceive money as working". For those singing the praises of cryptocurrency I pose this question: Say the United States decides to allow decentralized cryptocurrencies to become the dominant medium of exchange in the US; say it even gets rid of the $USD. What prob…

Well, whether or not it's a problem depends on who you're asking, but:

Remember in the first Captain America movie when his first role in the military was on a tour raising money for the war? That was actually a thing at that point in time. You had to actually convince people to invest or give money to fund a war. The USD was tied to gold in the real world and they couldn't just create more.

Nowadays, we don't have that. A President might have to ask Congress for funding, possibly. And even then, that money might simply be borrowed (adding systemic risk) or printed (devaluing the rest of our money). As a result, the amount of public support required for waging a war (or any huge expenditure) is much lower.

That's a good thing if the people in power are correct despite popular opinion. That's not always the case, though.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#118

Post by jbrun »

quincunx wrote: post #101
jbrun wrote: post #85

Earlier quoted context omitted.

No, that is not at all the argument. The argument is that you cannot have an economy run on a deflationary currency, which bitcoin is. An effective economy requires a bit of inflation and the ability to issue new money when necessary for socio-political reasons. Crypto currencies are a cult, though the underlying tech is interesting.

While I understand the desire to have 2% inflation across the economy, wouldn't the individual parties prefer to hold their cash in a deflationary currency? Put differently and going fast forward; how can you have a mildly inflating currency (eg. EUR) when there's a deflationary currency (eg. BTC) as a viable alternative around? Would you propose we prohibit crypto currencies? (What would you propose?)

Crypto currencies can exist for those who want them, I don't see any reason to block them beyond ponzi scheme and marketing issues - similar to stock issues. So probably they need some regulation to not defraud unwitting people.

Bitcoin is not an alternative to Euros. That is the whole point. If you switched all euros to bitcoins and asked people to trade those, the economy would collapse as no one would want to trade their bitcoins because mathematically, they increase in value due to the limited issuance of them. Without modest inflation, the economy cannot grow as no one would spend money for investment purposes.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#119

Post by neilwilson »

bjarneh wrote: post #45

> Fiat currencies are not “backed by nothing”. They are backed by the labor and assets of all the humans who have obligations to pay in fiat So when we "print" more money, we print more labour?

When you create more money, which banks do every time they issue a loan, you are accommodating more saving in that currency.

If you're saving, you're not spending and if you're not spending you are denying other people an income.

The alternative is to confiscate savings, or ban them.

The bit the mainstream metallists miss is that deposits are a result of loans, not the other way around.

Re: Fiat is Effective: fiat for the crypto crowd [pdf]

#120

Post by Laforet »

Spivak wrote: post #111
lightbyte wrote: post #108

Earlier quoted context omitted.

>- civil asset forfeiture; How would cryptocurrencies prevent the police from seizing your private keys? They can already throw you in jail if you refuse to provide passwords, or the keys themselves.

Current situation: Government takes your money and you must sue to get it back. Crypto: Government is incapable of taking your money and must prosecute in order to coerce you to turn it over. And you could still refuse and accept your jail time. Edit: People replying to me are missing the point. This is about the case where the government is wrongfully taking your money. Under the current system your money can be sei…

Civil forfeiture is not limited to cash money. Your lambo car, mansion house or any other property could be seized just as easily under the current regime.

In case of crypto, the storage media containing the private keys could be seized. Failing that, the government can always obtain an injunction to blacklist your addresses to exchanges, nodes and miners as long as those operate within their jurisdiction.

You could use a brain wallet to mitigate these risks to some extent, but I doubt it is possible to put all your assets in one place and you expose yourself to the risk of cryptanalysis by torture.

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