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Letter in Support of Responsible Fintech Policy

concerned.tech

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Re: Letter in Support of Responsible Fintech Policy

#101

Post by discordianfish »

bitcoin_anon wrote: post #34

Serious question for those of you who want to regulate Bitcoin out of existence: What do you propose to do with those of us who, despite your attestations of its uselessness, have deemed it useful and purchased it with our hard earned money? For example, MSTR has ~$4 billion in Bitcoin on its balance sheet. It purchased it on the free market for reasons that were valid to it. However, you disagree and want to step in…

I don't think it should be regulation as much as made illegal. I'd encourage all governments to put policy in place to outlaw exchanging crypto for fiat. Until that policy takes action, you can convert still trade in your crypto.

Re: Letter in Support of Responsible Fintech Policy

#102

Post by TimPC »

bitcoin_anon wrote: post #95
criddell wrote: post #50

Earlier quoted context omitted.

What was done for those who held vast stores of tulips and tulip bulbs at the end of the tulip craze? As far as I know, very little. Today companies at least have bankruptcy protection and corporate structures that should shield individuals. That said, I think Bitcoin should face most of the same regulations that other securities face and in the end I think this will help Bitcoin and other cryptocurrencies. I don't t…

> What was done for those who held vast stores of tulips and tulip bulbs at the end of the tulip craze? As far as I know, very little. The difference is that the tulip craze died of its own accord. This question was posed to those who would like to regulate Bitcoin out of existence.

Government has a right to regulate in order to deal with negative externalities and the negative externalities from Bitcoin and other crypto are extremely large. Most of crypto has been various type of financial schemes and regulators should ensure at a minimum that all investors in such schemes were properly accredited and impose regulation if the tokens were historically taking unaccredited investment. The government also has the right to regulate polluters and even an outright ban is reasonable if they conclude that the environmental cost of proof of work vastly outweighs the very limited use cases and benefits that have been shown to date. Finally, and I think the strongest argument is the government is allowed to regulate financial transactions. Bitcoin and other crypto intentionally circumvent this by removing the party conducting the financial transaction. Government could conclude this is unreasonable resulting in a ban or could create reporting requirements for any cryptocurrency transaction, subjecting one or both end users to requirements currently dealt with by banks. The idea that crypto-proponents seem to have is that removing the bank should remove all reporting requirements on transactions and I don’t see a reason for that to be true. I think in aggregate there is a fairly reasonable case for a ban across multiple substantial issues. And no, the government does not owe people for the price consequences of its regulatory policy. Investors in casinos are not made whole for changes in gambling laws.

Re: Letter in Support of Responsible Fintech Policy

#104

Post by bitcoin_anon »

TimPC wrote: post #102
bitcoin_anon wrote: post #95

Earlier quoted context omitted.

> What was done for those who held vast stores of tulips and tulip bulbs at the end of the tulip craze? As far as I know, very little. The difference is that the tulip craze died of its own accord. This question was posed to those who would like to regulate Bitcoin out of existence.

Government has a right to regulate in order to deal with negative externalities and the negative externalities from Bitcoin and other crypto are extremely large. Most of crypto has been various type of financial schemes and regulators should ensure at a minimum that all investors in such schemes were properly accredited and impose regulation if the tokens were historically taking unaccredited investment. The governme…

> Investors in casinos are not made while for changes in gambling laws.

What about the people seated at the tables in the middle of a hand?

Re: Letter in Support of Responsible Fintech Policy

#105

Post by TimPC »

tatertots1234 wrote: post #47
TimPC wrote: post #41

Earlier quoted context omitted.

This world would suck for the same reason I don’t use debit to pay for things from untrusted merchants. Credit cards provide an incredible security layer in transaction reversibility that allows you to transact with unknown merchants. Internet payments doesn’t work without it. What cryptocurrency is going to solve this problem?

You realize that in many countries, credit cards are not common? People pay for things online with their debit card all the time. Not all consumers need or want transaction reversibility, especially if they trust the contracts they are using, like depositing tokens into a DEX contract address that has not changed for several years - this has an extremely low counterparty risk. A VISA- or PayPal-like reversible paymen…

So we reinvent a VISA-like entity that charges VISA-like fees to replace VISA. This seems like a very impressive and extremely novel innovation.

Re: Letter in Support of Responsible Fintech Policy

#106

Post by bitcoin_anon »

pavlov wrote: post #56
bitcoin_anon wrote: post #34

Serious question for those of you who want to regulate Bitcoin out of existence: What do you propose to do with those of us who, despite your attestations of its uselessness, have deemed it useful and purchased it with our hard earned money? For example, MSTR has ~$4 billion in Bitcoin on its balance sheet. It purchased it on the free market for reasons that were valid to it. However, you disagree and want to step in…

This has to be the least convincing argument for not regulating Bitcoin: “What about this obscure enterprise software company that took billions of loans to buy Bitcoin? The company’s shareholders would be very sad if they had a margin call on those loans.” MSTR would presumably have to go back to selling software instead of speculating on unrelated assets. And everybody else can keep their Bitcoins too, it might jus…

Nice strawman.

Re: Letter in Support of Responsible Fintech Policy

#107

Post by TimPC »

Ar-Curunir wrote: post #90
JumpCrisscross wrote: post #61

Earlier quoted context omitted.

> we did not see the need for privacy preserving digital currencies and peer-to-peer transactional systems, and now some of us do Fair enough. I think it's time for those who do to make their case. We've run the experiment. The downsides are documented and tangible. There should be a way to thread the needle whereby the downsides can be limited without strangling all of the upside.

The vast, vast majority of money laundering and illicit financial activity happens within the confines of the traditional banking system. Why don’t we start with regulating that properly first?

We’ve done a lot to regulate banking and when we catch banks engaging in problematic behaviours there are hefty fines attached. We’ve seen huge numbers of crypto schemes without any real consequences to those involved or those knowingly profiting off a scam. If we should be regulating all illicit financial activity the largest gap exists in cryptocurrencies not traditional banking.

Re: Letter in Support of Responsible Fintech Policy

#108

Post by howinteresting »

JumpCrisscross wrote: post #49
tatertots1234 wrote: post #37

The letter has some good and bad. Good because it advocates for more regulation and consumer protection, and points out some obvious concerns with crypto like energy expenditure in proof of work. Bad because the letter misrepresents the technology and paints privacy as a purely criminal behavior, and suggests the entire technology sector is useless. > Similarly, most public blockchain-based financial products are a d…

> imagine this argument being applied to End-to-End Encryption There's a stark line between encrypted communication and encrypted money. If someone can't see the difference between those bits they shouldn't be handling other peoples' money.

So you should be able to communicate privately with an abortion provider in a jurisdiction where it's illegal, but not pay them privately?

Re: Letter in Support of Responsible Fintech Policy

#109

Post by criddell »

bitcoin_anon wrote: post #104
TimPC wrote: post #102

Earlier quoted context omitted.

Government has a right to regulate in order to deal with negative externalities and the negative externalities from Bitcoin and other crypto are extremely large. Most of crypto has been various type of financial schemes and regulators should ensure at a minimum that all investors in such schemes were properly accredited and impose regulation if the tokens were historically taking unaccredited investment. The governme…

> Investors in casinos are not made while for changes in gambling laws. What about the people seated at the tables in the middle of a hand?

It's not unlike mine owners complaining that new environmental regulations make running their mine impossible.

That said, regulations would probably come into effect after some short period of time and likely in stages.

Re: Letter in Support of Responsible Fintech Policy

#110

Post by tatertots1234 »

TimPC wrote: post #105
tatertots1234 wrote: post #47

Earlier quoted context omitted.

You realize that in many countries, credit cards are not common? People pay for things online with their debit card all the time. Not all consumers need or want transaction reversibility, especially if they trust the contracts they are using, like depositing tokens into a DEX contract address that has not changed for several years - this has an extremely low counterparty risk. A VISA- or PayPal-like reversible paymen…

So we reinvent a VISA-like entity that charges VISA-like fees to replace VISA. This seems like a very impressive and extremely novel innovation.

Pretty much. Now VISA has to compete with every other protocol deployed on the permissionless network, some of which may charge lower to no fees and provide different user experiences. Users can also, as they desire, connect with the base layer if they wish to circumvent the VISA-like protocols entirely. An example of that might be a company moving or exchanging several million dollars without wanting to deal with VISA-like fees and control mechanisms.

In truth, we may not see VISA-like protocols on the blockchain for some time, as most users are finding the counterparty risk small enough with the base layer that there is little demand for chargebacks and transaction disputes.

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