The political case for a blanket cryptocurrency ban • Hacker News Board

Re: The political case for a blanket cryptocurrency ban

#161

Post by rybosworld » Wed, Mar 31, 2021, 5:10 PM UTC

quickthrower2 wrote: post #148

DickingAround wrote: post #53

This article seems to intentionally ignore the core reason for cryptocurrencies; escaping inflation and control. The article then proposes to use the law to bring those people back within the control of fiat and government oversight. I no longer think the environmental argument is really plausible here. Clearly crypto mining is emitting using a lot of power and some of that is CO2. But the competition is fiat; backed…

If we are Saying fiat is backed by fighter jets then Bitcoin is backed by selling dangerous fake MDMA. That’s if we are getting into that way of arguing which hopefully we are not.

That's really not a solid argument. Bitcoin doesn't depend on drugs to have value, anymore than the US dollar does.

Re: The political case for a blanket cryptocurrency ban

#162

Post by Kranar » Wed, Mar 31, 2021, 5:11 PM UTC

aarongray wrote: post #137

tome wrote: post #136

Earlier quoted context omitted.

Could you elaborate?

Home prices in my area are up around 15% over the past year.

That makes real estate investments a good defense against inflation. A good defense against inflation are assets whose price increases at a rate higher than the rate of inflation. A bad defense would be an asset whose price increases at a rate lower than that of inflation.

Re: The political case for a blanket cryptocurrency ban

#163

Post by fancyfredbot » Wed, Mar 31, 2021, 5:11 PM UTC

quickthrower2 wrote: post #119

fancyfredbot wrote: post #101

You can't really frame a ban as a way of protecting the little guy if your ban causes everyone who "invested" so far to immediately lose everything. You'd almost certainly be sued and end up paying compensation. Even a partial ban restricting who can invest would be open to accusations of elitism and politically difficult. I suspect that a politician who thinks the crypto market is going to crash will wait for that t…

A carbon tax/price might work assuming you could get that through. Then tax a percentage on Bitcoin purchases via exchanges to aloe for the carbon emissions.

Agree it might be workable, although Tobin taxes like this haven't had a lot of support in the past. Also, enforcement is likely to be a bit of a nightmare!

It would raise some money you could use to mitigate environmental impact, but I'm not sure that a reasonable tax level would actually disuade anyone from putting their money in so less helpful from that point of view.

Re: The political case for a blanket cryptocurrency ban

#164

Post by tome » Wed, Mar 31, 2021, 5:11 PM UTC

rybosworld wrote: post #142

tome wrote: post #127

Earlier quoted context omitted.

> Bitcoin seems to benefit disproportionately from inflation Does it? On what basis would one know that? Why should it benefit from inflation more than gold, say?

My argument would be it's the only thing on that list of inflation hedges that has a fixed supply. Lot's of gold is mined each year. Houses are built. Stock is issued, etc. Bitcoin has a well-established upper limit.

> [Bitcoin is] the only thing on that list of inflation hedges that has a fixed supply.

Aha! That brings me to my next question. In what sense does bitcoin actually have a fixed supply? Sure, a loose coalition of people agree for it to have a fixed supply at the moment, but if enough of the miners, core developers, etc. agree they can change the rules arbitrarily, viz. hard forks.

Why should we believe that bitcoin really has a fixed supply, just because everyone has roughly stuck to the rules so far?

Re: The political case for a blanket cryptocurrency ban

#165

Post by fsociety » Wed, Mar 31, 2021, 5:12 PM UTC

iujjkfjdkkdkf wrote: post #66

slibhb wrote: post #32

Earlier quoted context omitted.

The main premise of the article is that cryptocurrencies are "speculation for speculation’s sake," i.e. gambling, and that's bad. Also, the article claims that they contribute to inequality. The green stuff is basically a side note. I don't think it's a terribly strong case but I suppose it depends on whether you agree that crypto is gambling and if you think gambling should banned. Anyway, I think lots of people stu…

Gambling, e.g. casino or sports betting is different because for some it's a fun pastime and participants are (more or less) aware of what it's about. "Crypto" - not the underlying tech which is potentially interesting and may have merit in some incarnation - but buying or trading "assets" grounded in the tech, is essentially a quasi-legal pump and dump scheme right now. There is a rich history of securities law that…

I will push back and say that the current wave of hype is gambling, not ponzi schemes. Some of it is pump and dump but generally there are cryptocurrencies which aren’t. The gambling aspect came to light with many of the new DeFi apps.

DeFi kinda started as decentralized exchanges but seemingly changed into apps which allow you to leverage tokens. This is like gambling for tech geeks. Probably this will die and be replaced by gambling for non-tech savvy individuals.

The more interesting side, for me personally, is powering financial assets on the blockchain. There is still work that needs to be done here.

I’m particularly worried about how easy theft of tokens can be, but I think that is a solvable problem. Perhaps through technical means or perhaps through banks holding your assets and covering you with something similar to FDIC or insurance.

So all-in-all I don’t think it’s fair to call this one big fraud or pump-and-dump schemes. Some are yes but many aren’t. Like the dotcom bubble many will lose all invested money however the general promise and tech will deliver something world changing.

Re: The political case for a blanket cryptocurrency ban

#166

Post by UnpossibleJim » Wed, Mar 31, 2021, 5:12 PM UTC

slibhb wrote: post #32

_nckn wrote: post #5

I think the main premise of this article is the fact that crypto's carbon emission is insane, especially Bitcoin, which I agree (I don't hold Bitcoin for this exact reason). But there are many other crypto that uses Proof of Stake, way way greener than Proof of Work, such as Cardano. Even Ethereum is transitioning to Proof of Stake. This article should be re-titled "The Political Case for a Blanket Proof of Work Ban"…

The main premise of the article is that cryptocurrencies are "speculation for speculation’s sake," i.e. gambling, and that's bad. Also, the article claims that they contribute to inequality. The green stuff is basically a side note. I don't think it's a terribly strong case but I suppose it depends on whether you agree that crypto is gambling and if you think gambling should banned. Anyway, I think lots of people stu…

There is speculative trading in stocks and bonds, but not as frequently. It is a choice that a trader can make, though and hasn't been regulated away. I have no problem with government regulation on Cryptocurrency for speculation if the same laws effect the trading of stacks and bonds.

The "green" issue of Crypto mining is a harder regulatory issue for our government to get involved in, though. While on the one hand, I applaud their pro action, on the other hand, the hypocrisy is on a scale almost never seen. A government which has simultaneously rolled back environmental regulation, wildlife areas and expanded oil pipelines, shale extractions, fracking and offshore drilling while continuing a war on "terrorism", which is an ideal, not an enemy. A forever war, if you will. This is a polluter much bigger than crypto miners, so you'll excuse me if I have to take the concern about the environmental impact concern from the Senate all that seriously...... sorry. Went off the track. Either way, there are larger polluters to tackle than Crypto that take less control away from people.

Re: The political case for a blanket cryptocurrency ban

#167

Post by aarongray » Wed, Mar 31, 2021, 5:12 PM UTC

tome wrote: post #151

aarongray wrote: post #137

Earlier quoted context omitted.

Home prices in my area are up around 15% over the past year.

I'm confused. That suggests that real estate is very much resistant to inflation.

Haha I was wrong, I see what you were saying now. I thought you were saying that resistance == unaffected. But you were saying that the price of real estate rises when inflation occurs, so buy it before inflation happens. My bad. :)

Re: The political case for a blanket cryptocurrency ban

#168

Post by vkou » Wed, Mar 31, 2021, 5:13 PM UTC

pingpongchef wrote: post #133

tome wrote: post #74

Earlier quoted context omitted.

> This article seems to intentionally ignore the core reason for cryptocurrencies; escaping inflation I'm extremely confused by this argument that I see again and again. If you want to avoid your assets losing value to inflation that you can buy assets that are resistant to inflation, such as stocks, real estate, land, gold, inflation-adjusted bonds ... I just don't see that cryptocurrencies are particularly useful f…

Stocks and bonds are still coupled to fiat currencies and will be directly impacted by their perceived deficiencies when compared to crypto. Hard assets like real estate, land, gold don't fit that bill, but each of their own tradeoffs. Right now cryptocurrencies are making gains against those hard assets so they are more attractive. An investor may wish to diversify among some or all of these options.

Stocks are not coupled to fiat, fiat is just the common medium of exchange for them. Nobody will stop me from trading my GOOG share for a goat, or a baseball card, if I so choose.

Stocks are coupled to the productive output of the firm the stock is issued by, which is coupled to it's real world productivity - which, again, for convenience is measured in a fiat currency.

Re: The political case for a blanket cryptocurrency ban

#169

Post by hakesdev » Wed, Mar 31, 2021, 5:13 PM UTC

DickingAround wrote: post #53

This article seems to intentionally ignore the core reason for cryptocurrencies; escaping inflation and control. The article then proposes to use the law to bring those people back within the control of fiat and government oversight. I no longer think the environmental argument is really plausible here. Clearly crypto mining is emitting using a lot of power and some of that is CO2. But the competition is fiat; backed…

This. 100%.

Bitcoin (like gold since the gold standard ended) is just a "check" on Fiat currencies and can act as insulation from central banks that issue too much money too quickly.

Fiats will continue to exist alongside bitcoin/cryptos, they'll just eventually have to "compete" a bit more (i.e., not be printed so readily by gov'ts) or else they'll become significantly less relevant.

Re: The political case for a blanket cryptocurrency ban

#170

Post by tome » Wed, Mar 31, 2021, 5:13 PM UTC

pingpongchef wrote: post #133

tome wrote: post #74

Earlier quoted context omitted.

> This article seems to intentionally ignore the core reason for cryptocurrencies; escaping inflation I'm extremely confused by this argument that I see again and again. If you want to avoid your assets losing value to inflation that you can buy assets that are resistant to inflation, such as stocks, real estate, land, gold, inflation-adjusted bonds ... I just don't see that cryptocurrencies are particularly useful f…

Stocks and bonds are still coupled to fiat currencies and will be directly impacted by their perceived deficiencies when compared to crypto. Hard assets like real estate, land, gold don't fit that bill, but each of their own tradeoffs. Right now cryptocurrencies are making gains against those hard assets so they are more attractive. An investor may wish to diversify among some or all of these options.

No, neither inflation-adjusted bonds nor stocks are "coupled" to fiat currencies. You may argue that RPI is not a true measure of inflation. OK, sure. You may argue it's hard to persuade people to buy a hamburger for $2 when it was $1 last year. But the same applies to cryptocurrency (when it's not in a mass speculative bubble)!