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

Re: The political case for a blanket cryptocurrency ban

#231

Post by JumpCrisscross » Wed, Mar 31, 2021, 5:41 PM UTC

vkou wrote: post #168

pingpongchef wrote: post #133

Earlier quoted context omitted.

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.

> Nobody will stop me from trading my GOOG share for a goat, or a baseball card, if I so choose.

Nitpick, but the SEC would object to that. That said, American securities regulation has a unique philosophy, i.e. every securities trade must be registered and follow a narrow book of rules unless specifically exempted.

Your broader point, of financial and real assets being proven hedges against inflation, stands.

Re: The political case for a blanket cryptocurrency ban

#232

Post by [deleted] » Wed, Mar 31, 2021, 5:41 PM UTC

seibelj wrote: post #201

abakker wrote: post #195

Earlier quoted context omitted.

I never understand the counter-inflation argument...most economists understand inflation is something to be managed, but it is far from proven that target inflation is bad. There are many useful economic properties of inflation. Meanwhile, Bitcoin has undergone such massive speculative appreciation that everything around it has deflated in comparison. As a result, bitcoin is spectacularly less useful than it would ha…

It has never been proven that deflation is bad - Keynesians claim this is the worst thing in the world, but I still have never had it explained to me coherently way deflation is inherently a bad thing.

[deleted]

Re: The political case for a blanket cryptocurrency ban

#233

Post by JumpCrisscross » Wed, Mar 31, 2021, 5:42 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…

If you buy the case, which I do in part, then the solution isn't to prohibit it. It's to tax it.

Re: The political case for a blanket cryptocurrency ban

#234

Post by kibleopard » Wed, Mar 31, 2021, 5:43 PM UTC

javert wrote: post #124

kibleopard wrote: post #95

Earlier quoted context omitted.

> Bitcoin is objective, hard, honest money Yes, definitely makes sense when the main usage of it is money laundering and mindless speculation

That isn't the case, but believe what you want.

I mean, if you'd like to see some academic research backing up that it is indeed the case, see here: https://academic.oup.com/rfs/article-abstract/32/5/1798/5427...

"We find that approximately one-quarter of bitcoin users are involved in illegal activity. We estimate that around $76 billion of illegal activity per year involve bitcoin (46% of bitcoin transactions), which is close to the scale of the U.S. and European markets for illegal drugs."

I would love if you could point me towards a current use of Bitcoin that isn't as a currency for illegal goods, or as an investment vehicle -- I'm genuinely curious why you think what I said isn't the case.

Re: The political case for a blanket cryptocurrency ban

#235

Post by dionidium » Wed, Mar 31, 2021, 5:43 PM UTC

smeej wrote: post #158

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 is such an underappreciated point. U.S. dollars are backed by violence. Bitcoin is backed by math. I don't know what you want backing your money in the world you hope to leave for future generations, but I know what I want backing mine.

It's not underappreicated; it's facile. Everything you do in society is backed by the state's monopoly on violence. What are you going to do when I storm into your house with guns, kill your family, and demand access to your wallet? Appeal to math?

Re: The political case for a blanket cryptocurrency ban

#236

Post by tome » Wed, Mar 31, 2021, 5:43 PM UTC

smeej wrote: post #158

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 is such an underappreciated point. U.S. dollars are backed by violence. Bitcoin is backed by math. I don't know what you want backing your money in the world you hope to leave for future generations, but I know what I want backing mine.

What math prevents a big enough group of miners and users rolling back the blockchain?

Re: The political case for a blanket cryptocurrency ban

#237

Post by temp8964 » Wed, Mar 31, 2021, 5:44 PM UTC

Luker88 wrote: post #222

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…

> clearly crypto mining is emitting using a lot of power and some of that is CO2. But the competition is fiat; backed by fighter jets and nukes; literally just 2 points: * using crypto will not make the military stop existing * switching to Proof Of Stake would solve almost all bitcoin problems ...but bitcoin will not even consider keeping PoW and switching to argon2, since the investment of miners in dedicated hardw…

One more factor though: path dependency. For historical reason, BTC is the most popular cryptocurrency. Maybe as you said, an altcoin with PoW is a better choice. (Or maybe there are other reasons PoW is not good. Let's just take your statement as true for the sake of discussion.)

But you can't change everybody's mind like turn off a switch. Adoption takes time and change people's mind is difficult, but it doesn't make everyone else to be lying.

Re: The political case for a blanket cryptocurrency ban

#238

Post by intuitionist » Wed, Mar 31, 2021, 5:44 PM UTC

oxymoran wrote: post #213

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…

A)I don’t have $150k+ To just go invest in land or real estate that I’m not going to reside in. B)Are stocks and bonds inflation resistant if they are priced in the inflating currency? Not just normal year over year inflation but the type of inflation that happens when you debase a currency. Regardless, I already own these, the first rule of investing is diversification. C)gold is inflation resistant and tangible so…

A share of Weyerhaeuser stock costs around 35 bucks and gets you a (modestly levered) claim on forestland, one of the most inflation-protected assets in history. A round lot costs around 3500. If you prefer hard metals, there are highly liquid ETFs that trade in even smaller denominations. If you want exposure to these asset classes you can mostly get them.

Re: The political case for a blanket cryptocurrency ban

#239

Post by csomar » Wed, Mar 31, 2021, 5:44 PM UTC

I think this article is a very nice example of why the US is superior (or at least I think is superior) to China. The political system that allows someone (or some entity) uninhibited power over its citizens, institutions, companies and rights; or the political system where power is fragmented and people need to converge toward a solution (through potential infighting in a big building), need to convince other people using words (through media, lobbying, NGO work, etc...), and need to accept compromises with people who have wildly different ideas and ideals than theirs.

The author positioned himself as the sole source of truth. Then, as a judge, deemed all cryptocurrencies and their operators as an evil. Then, wants to use the full powers of the United States (judicial, police, regulators, diplomatic) to enforce his ruling.

It's not even clear why this author should have any authority? He doesn't have any projects, ran any companies (or any mentions of that) or did any significant academic work. His whole blog is a crypto rage: https://www.stephendiehl.com/blog.html

Re: The political case for a blanket cryptocurrency ban

#240

Post by khmmr » Wed, Mar 31, 2021, 5:45 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…

You do understand that cops and fighter jets and nukes are the only reason why you are not slaving in labor camp for some foreign power? It's a necessity. Bitcoin is useless for anyone's physical safety. As of today is provides almost zero value at all. You could argue, that censorship resistance is helpful for people living in authoritarian regimes but that's about it, so the only value it has comes from it being "illegal" in some region. At the same time Bitcoin is already wasting as much resources as some mid-sized European country. The environmental argument is relevant in every way.