Technical feasibility of regulating public Blockchain explored

There are many regulations are about how certain things should look, for example, construction code, or food quality control. Even internet has been changed by regulation, like the EU data protection plan, it is just behind the scene, but greatly affects the way how company operates.

So I don't think there is a clear cut between regulation and things affected by it. There are intrusive ones and there are reactive ones. As to Bitcoin, I think it is probable that the regulatory body will require transparency for recognition of its legitimacy as a demand.

The problem is that «manipulation» by governments as you call it, is part of its toolkit, and a lot of empirical evidences shows that the cost of doing nothing when something should have been done is orders of magnitude worse than «manipulation for political reasons». Take for instance Germany is the 1920s: the hyper-inflation during the early 20s was a huge mess, but it had much lower consequences than the inaction after the crisis of 1929 with a huge economic slowdown caused by deflation.

A government not controlling its currency is catastrophic when something go wrong, you can see what happened to southern Europe during the last decade. I'm not saying the Quantitative Easing is the best way to go out of a financial crisis, but for sure it's better than doing nothing and waiting for the market to correct itself.[1]

Imo, people afraid of the Government and wanting to drastically limit its power are a bit like anti-vaxer: vaccines can indeed cause problems (and they do, a few people have dramatic secondary effects, like with any medicine) and must be controlled, but wanting to abolish them is suicidal. The anti-state psychology was understandable during the cold war, as people had a good example of what can happen when a government has total power on the economy and society as a whole, yet this irrational fear is really polluting the debate when it comes to defining the economic policies.

[1]: scientific evidences are hard to find in Economics, but this particular topic was the point of the Keynes / Hayek controversy during the great depression and, on this particular topic, Keynes proved right.

However I think there are still a lot of things that a government could do too help its people in extreme situations, even if they were normally using a currency out of its control. Things that don't involve limiting the flow of currency or reducing its value.

The ideal of people being able to transact in a frictionless way, beyond borders and without having to deal with massive opaque entities (banks) just makes so much sense from my perspective that it's worth trying to find new solutions to any problems starting from that point.

I simply struggle to accept that an individual should suffer the consequences of an incompetent or malicious government in what should be a fundamental right (trading and securing your wealth). As a Greek I have experienced some of these consequences first-hand, in the form of capital controls and cross-border trading restrictions. People in other countries are experiencing them in a much more extreme scale.

But a citizen of a highly prosperous developed nation can still experience too much friction in day-to-day transactions that should be simple, a lot of which happens under the disguise of "your own security". Well, if someone wants to assume the responsibility of his own security, I don't see why he shouldn't be able to.