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Report on Stablecoins [pdf]

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Re: Report on Stablecoins [pdf]

#361

Post by werdnapk »

lentil_soup wrote: post #298
icelancer wrote: post #253

Earlier quoted context omitted.

I've responded to several commenters who say this with my real world examples, the most notable of which are paying people in Venezuela to do work for me when most mainstream forms of monetary exchange are nearly impossible in/out of that country.

Venezuelan here. You're exaggerating the use of bitcoin in Venezuela. You might have paid some people with it but on the streets you use and want USD. Zelle, PayPal or USD in cash. No one wants another volatile currency, we've had enough of those.

Is it true that parts of Venezuala are using flecks of gold as currency? Or is that just highly localized in usage and/or mostly in remote areas?

Re: Report on Stablecoins [pdf]

#362

Post by bubbleRefuge »

vineyardmike wrote: post #254
dustingetz wrote: post #80

Earlier quoted context omitted.

Risk is that a tether run causes all of crypto to collapse, not just USDT. How many actual dollars are in the system? Everything real has been exfiltrated through electricity bills, taxes and early adopters selling, the entire crypto economy is a hollow shell, leveraged on retail deposits.

I want to preface this by saying I don't own crypto and I think its often full of scams (eg. squid coin). But it has some real potential and isn't always as bad as it seems. Tether is a real risk, I agree. > Everything real has been exfiltrated through electricity bills, taxes and early adopters selling, the entire crypto economy is a hollow shell, leveraged on retail deposits. Yeah, but that's not untrue for banks.…

Banks do not lend deposits in fiat currency regimes such as the ones most western countries have. Banks create deposits out of thin air to 'fund' loans. The have capital and reserve requirements to meet, of coarse, but they do not lend out deposits or depend on deposits for lending.

Re: Report on Stablecoins [pdf]

#363

Post by epinephrinios »

mminer237 wrote: post #263
spir wrote: post #182

Earlier quoted context omitted.

Crypto "expert" here. We will have a catastrophic crash, it's normal and natural. But, the tech is here to stay and is 100x better than existing solutions. Crypto is changing the world, one crash at a time :)

The only practical differences in the tech is that it wastes more power, has no insurance, has no fraud remediation, and has no safeguard against volatility. I guess the potential anonymity too, but that's only really a practical benefit if making an illegal transaction. The only time I can ever see a cryptocurrency being worth it is if you do not have any central authority you can trust. If we ever get to the point…

I can protect my own money, thank you. I do not need a nanny.

Anonymity might seem redundant to you and other people who "have nothing to hide". However, in a slightly more dystopian reality -e.g. when we are forced to use CBDCs- the government might choose to block you from using your hard earned money because you posted a criticism of the president on twitter.

Re: Report on Stablecoins [pdf]

#364

Post by irae »

arcticbull wrote: post #278
caf wrote: post #248

Earlier quoted context omitted.

This all sounds intuitively correct, and it seems that similar arguments can be made about gold bullion, right? It costs some amount of money every year to mine, refine, transport and store it, and none of that is accruing to the actual holders of bullion. (One difference being that there is some residual value of the gold for industrial and jewellery uses, but that's hardly what's keeping the bullion price where it…

It's similar gold, yes. Gold is an unproductive asset. You are correct that there is base demand for it in the form of jewelry and electronics. In fact, a percentage of the world's gold output goes into making Bitcoin miners each year. However, its value is not supported by its demand in these industries. This is why I personally do not invest in gold. The difference is that if you shut down gold mining, existing gol…

> If you shut down Bitcoin mining it's immediately worth nothing.

Except that it is impossible ever shut down Bitcoin mining at once(). It might be more similar to gold than what you think.

There are too many incentives to keep it up. The holders want value to be kept, the miners have vested interest in the system to continue to work. If you shut down, say, half the miners, this will create opportunity to other miners to invest and expand. If it drops too much, people inject money into the system, which gives liquidity to the miners again, that can continue to trade their work for goods and services with Bitcoin or by trading Bitcoin for fiat.

It is very similar to Visa, Mastercard, Stripe, Square and other centralized systems. The fees you pay for transactions keep the centralized finance business working and profitable as well as they invest back in software and hardware. For miners the Bitcoin fees, based on Bitcoin price, keep their systems profitable too. Not to mention some mining companies started to get listed on the stock market too.

(): Yes, you can shut down Bitcoin eventually, bugs, attacks, etc., but those have been tried and not very relevant to my point.

Re: Report on Stablecoins [pdf]

#365

Post by knz »

TomSwirly wrote: post #194
spir wrote: post #182

Earlier quoted context omitted.

Crypto "expert" here. We will have a catastrophic crash, it's normal and natural. But, the tech is here to stay and is 100x better than existing solutions. Crypto is changing the world, one crash at a time :)

> 100x better than existing solutions. And after ten years, there isn't one actual application of cryptocurrencies except for speculation and crime.

> And after ten years, there isn't one actual application of cryptocurrencies except for speculation and crime.

Remittances - https://en.m.wikipedia.org/wiki/Remittance

There is a vast market for efficient, fast, and affordable methods of transferring money/wealth across political boundaries. Blockchain/crypto seems to be filling that niche for many people, myself included, without "speculation and crime" being a factor. There is no "remittance app" for it because you can do it with your pick of various widely available crypto coins and exchanges.

Re: Report on Stablecoins [pdf]

#366

Post by annoyingnoob »

sub7 wrote: post #294
liquidise wrote: post #215

Earlier quoted context omitted.

> Crypto continues to help nobody and achieve nothing in the real world Crypto posts on HN seem to be a hotbed for these sorts of hyperbolic, wholly unsubstantiated and objectively false comments. I wish i understood what the motivation was for these sorts of replies.

Please show me a real world use case that's better than the status quo and is not speculation or gambling. It's been over 12 years and I'm still looking. Cryptoclowns can't use the it's too early excuse anymore. But they choose to listen to a handful of man children running around promising world peace via a distributed database.

There are several options to 'stake' (deposit) coins/tokens and earn interest. You can earn more interest in crypto than you can at a bank. Assuming you trust the underlying tech long enough for your investment horizon.

Re: Report on Stablecoins [pdf]

#367

Post by FabHK »

arcticbull wrote: post #223
swader999 wrote: post #204

Earlier quoted context omitted.

There is value in having a monetary system though. And if BTC is a better system and more people find it's utility for barter or wealth preservation better it might appreciate more in relation to something like the USD which has many different characteristics.

It's a strictly worse monetary system by any measure. It's massively more expensive to transact, it's unbelievably inefficient - requiring as much power as Thailand and generating as much e-waste as the Netherlands to scribble 2-3 tx/sec into a ledger. That's 60 days of power for the average US household and 1 iPad of e-waste per transaction . [1] [edit](97% of all mining hardware will be thrown away without ever win…

Given the capacity of the BTC blockchain, if everyone one earth finally adopted BTC (as some people dream about), everyone could get in about one transaction in their lifetime.

(3 tx/sec = 3 tx/sec * 31m sec/a = 100m tx/a = 10bn tx/100a, so the network supports 10 bn transactions in about 100 years, and there are about 10bn people on earth, each living around 100 years.)

Re: Report on Stablecoins [pdf]

#368

Post by bubbleRefuge »

nwiswell wrote: post #70
dragontamer wrote: post #48

Earlier quoted context omitted.

> The real question is what happens in the next recession. Well, there was a recession just last year and the stock market / BTC market went crazy. The real question is what happens in the next market downturn (specifically the cryptocoin market downturn, since these "stablecoins" look like they're "stable" only because of assumptions underlying the cryptocoin markets). The cryptocoin markets don't necessarily match…

> Well, there was a recession just last year and the stock market / BTC market went crazy. Ultimately this is because central banks are in the driver's seat for asset prices these days. It's been trending that way since the Greenspan Put in the 90's. The economic fundamentals matter, but not as much as the monetary policy backdrop; after all, if there's more cash chasing the same number of shares, it can't help but d…

Actually, it was fiscal policy which dropped money from helicopters in the form of pandemic assistance of all kinds including small business loans that will never be paid back again. In the 2007 financial crisis, the federal government bailed out banks and big finance ( see AIG). This time it was businesses and consumers who were bailed out. Allot of that money went into crypto and stocks.

Re: Report on Stablecoins [pdf]

#369

Post by arcticbull »

RustyConsul wrote: post #325
arcticbull wrote: post #293

Earlier quoted context omitted.

> Doesn't it seem weird that through this complex system of interactions, we can recreate all of that in Code? All of these systems are already software. > If there was no value in it, why did we create all those institutions in the first place? Centralization makes them massively more efficient than crypto. If there was a way to make them more efficient that did not involve throwing risk models out the window or reg…

Do you think we will forever be organized and segregated by governments? Do you ever think a human being can be a sovereign individual in his own right, without owing fealty, taxes and morality to a government in some future? The current financial system is not all software. When i pay in crypto, i give you my money. When i pay in the current financial system I am giving you every bit of information to rob me blind a…

> Do you think we will forever be organized and segregated by governments?

Since you asked, yes. I do. To me, it's like asking if a beehive will always have a queen. It's in our DNA.

> Also, you're right. POW as a consensus method is flawed. But again, all V3 cryptos have essentially transitioned to delegated proof of stake at this point.

I honestly don't know enough about "V3 cryptos" to speak to it, and I'm not trying to add any FUD to the conversation :) I'll have to DMOR if you will before I can speak to that, which is why I've been constraining my comments to the system I know (BTC).

> Edit: There are 104 protocols/coins that have over $1B market cap. Value isn't a personal judgement, it's a group one.

[edit] Market cap isn't a judgement of value, just the most recent price multiplied by supply. Control the most recent price, you control the market cap. Unless you include legitimate market depth it's not really a meaningful number. SHIB for instance.

Re: Report on Stablecoins [pdf]

#370

Post by epinephrinios »

spir wrote: post #330
santiagobasulto wrote: post #242

Earlier quoted context omitted.

Thanks for that link. I've been long on BTC since the beginning, and I fully love the concept of crypto. But busy with work (and I sold my startup 2 years ago) I went completely dark on the Crypto world. Now I'm trying to catch up with it and both DeFi and everything Layer 2 seem to be the future. Do you have any other resources to recommend?

My pleasure! I'd recommend the Bankless podcast and newsletter https://newsletter.banklesshq.com/ https://podcast.banklesshq.com/

The Daily Gwei (https://www.youtube.com/c/TheDailyGwei) is great for catching up with news.

Also the ROLLUP series from Bankless (e.g. https://www.youtube.com/watch?v=ooIZzpOsoko)

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