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

Re: The political case for a blanket cryptocurrency ban

#401

Post by SkyBelow » Wed, Mar 31, 2021, 9:05 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.

Exactly what bitcoin is backed by is something of a mystery for economist to debate. Much of it is people speculating, but I don't see anything unreasonable with saying much of the value, at least pre-speculation, is from its use to carry out illegal transactions. There is some use in other areas so I wouldn't say it was ever entirely the case, but I don't see what's wrong with arguing it was a major factor and is still somewhat of a factor. I do expect between speculation and alt coins better made for hiding activity it is a small and shrinking factor now, but I could be wrong.

Re: The political case for a blanket cryptocurrency ban

#402

Post by hakesdev » Wed, Mar 31, 2021, 9:07 PM UTC

lamontcg wrote: post #257

hakesdev wrote: post #254

Earlier quoted context omitted.

If you don't understand why competition in monetary commodities is a good thing then... I don't have any time for you.

If you don't understand why bitcoin isn't [workable] money then... I don't have any time for you.

that isn't (fortunately) for you to decide ;-)

Re: The political case for a blanket cryptocurrency ban

#403

Post by nradov » Wed, Mar 31, 2021, 9:08 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.

The fears over deflation are mostly just hand waving without much support from real world data. As a prime example consider computers. How much computing capacity could you purchase for $1000 in 2001 versus today? The deflation in that market has been huge, and yet customers keep buying new computers.

Re: The political case for a blanket cryptocurrency ban

#404

Post by boringg » Wed, Mar 31, 2021, 9:10 PM UTC

djschnei wrote: post #57

boringg wrote: post #37

Ban? That silly. How you kill something you don't like is tax it heavily. Add on the carbon tax equivalent to each bitcoin transaction as well as tax the capital gains/losses. Interest will deflate on it's own.

You know capital gains tax already applies to all crypto transactions, right?

Of course I do.

Re: The political case for a blanket cryptocurrency ban

#405

Post by greycol » Wed, Mar 31, 2021, 9:16 PM UTC

atwebb wrote: post #345

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…

Things brings up a side point I can't quite understand. How does the price of BTC, which is almost infinitely divisible, affect usage? I see comments like "We're early, price can still rise, etc". Outside of a store of value any usage / institutional use for transactions wouldn't matter right? The BTC is a proxy for the money / collateral on the sides. If I buy a hamburger with BTC: If it is settled in BTC then the b…

Because to complete a bitcoin transaction it needs to be accepted on the block chain.

That incurs a relatively high flat fee (somewhere between $5-$50 dollars in recent times).

It doesn't make sense to pay this fee for small amounts (though is great for large amounts).

You can get around this by using exchanges and the equivalent of credit cards where multiple transactions are rolled up into one wallet to wallet transaction. This comes at the expense of volatility or if your bullish it comes at the expense of having to float a growing bitcoin reserve.

This is not an option for a lot of businesses, basically you need a 3rd party provider for it to make sense for these businesses and realistically that means they're getting cash value at time of trade and it's the provider that is taking on the volatility risk/reward of waiting to trade there bitcoin.

Re: The political case for a blanket cryptocurrency ban

#406

Post by redisman » Wed, Mar 31, 2021, 9:17 PM UTC

6gvONxR4sf7o wrote: post #302

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…

> But the competition is fiat; backed by fighter jets and nukes; literally. I don't like this meme. Fiat currency is backed by an entire democracy that includes a military, but the key piece here isn't the military, it's the democracy. Despite all the problems in the US and our economic system, the folks in charge of the currency generally have the right mandate (stable employment and stable prices).

Bitcoin also runs on infrastructure that is backed by the exact same forces. Networks, electricity, the computers. You couldn't have Bitcoin if those resources weren't protected by your government.

Otherwise I can for example find the top 100 largest Bitcoin miners and walk up to their door with guns and demand all their Bitcoins or I'll blow up the mines.

Re: The political case for a blanket cryptocurrency ban

#407

Post by snarf21 » Wed, Mar 31, 2021, 9:19 PM UTC

dnautics wrote: post #397

blake1 wrote: post #392

Earlier quoted context omitted.

Government agents show up at the data center and confiscate the servers in the mining pool. The coerce the owners into turning over the login credentials. Or they just deploy their own mining pool. Or the just tax all of their citizens’ cryptos. They have lots of options, since they have the power of the state behind them.

Why wouldn't the network soft fork?

China can rinse/repeat on any soft fork. There is also the ability to block crypto networks at the ISP level.

Re: The political case for a blanket cryptocurrency ban

#408

Post by lui8906 » Wed, Mar 31, 2021, 9:20 PM UTC

kibleopard wrote: post #234

javert wrote: post #124

Earlier quoted context omitted.

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…

Things have changed since your study. Chainalysis released a report in February (they are a company who specialise in tracking illegal transactions). The TLDR is that illegal transactions make up 0.4% of BTC transactions these days.

> https://en.cryptonomist.ch/2021/01/20/chainalysis-crypto-ill...

Re: The political case for a blanket cryptocurrency ban

#409

Post by webinvest » Wed, Mar 31, 2021, 9:20 PM UTC

kn0where wrote: post #72

Dumblydorr wrote: post #23

Most of the article's arguments work if you replace the word "Gold" for the word cryptocurrency. Gold itself is just a yellow metal, it is valuable largely for the human belief that it has value, though admittedly it is somewhat pretty, a good conductor of electrons, and has historical value due to its ease of work and use in numerous ancient artifacts. Still, as a currency or value holder, gold is simply a metal tha…

The US actually did ban possessing large amounts of gold during the Great Depression, so there’s legal and historical precedent.

But the US dollar was tied to a fixed amount of gold back then. When overseas influential creditors demanded that the US give them gold for their dollars like the US said it would, the US complied by buying it from US citizens at a fixed price 20-50% below prevailing gold market value. Once all the gold was given away, the US was able to abandon the gold standard. Once the gold standard was abandoned, the US was able to escape from the Great Depression of the early 1930s. Countries that left the gold standard sooner recovered faster from the Great Depression than countries that were slower to abandon the gold standard.

The US dollar is not backed by any amount of bitcoin so I don’t expect to see this happen with bitcoin.

Re: The political case for a blanket cryptocurrency ban

#410

Post by smeej » Wed, Mar 31, 2021, 9:20 PM UTC

dionidium wrote: post #235

smeej wrote: post #158

Earlier quoted context omitted.

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?

Given that you would first have to 1) Identify me as a target worth pursuing (not possible from my wallet addresses if I practice adequate sanitizing of inputs); 2) Figure out where I live (also not possible from wallet addresses, or even people who have sent to me); and 3) Verify I even had enough shards of a key accessible to me in my home to transfer funds to you anyway (not to mention 4) Outgun me), all the violence in the world isn't going to bypass the math.

If you're violent enough, nothing is going to protect me or the people I love from you, but that's regardless of whether my money is in Bitcoin or USD. There's no disadvantage for Bitcoin here.

The added difficulty of your obtaining the reward you seek actually reduces your incentive to try. The only incentive to kill me then is blind violence, and I guess you can admit to that motivation if you want, but it's protective for me against anyone less psychotically violent than that.