Digital Money Across Borders: Macro-Financial Implications • Hacker News Board

Re: Digital Money Across Borders: Macro-Financial Implications

#61

Post by dogman144 » Fri, Oct 23, 2020, 5:13 PM UTC

raverbashing wrote: post #26

mikro2nd wrote: post #8

I find it interesting that the paper focusses on Central Bank Digital Currencies and Global Stablecoins, but pretends not to see/prefers not to deal with the elephant in the room - Bitcoin. If anything is a candidate for a potential Reserve Currency, BTC is it, imho. Deep in the footnotes comes the contorted logic," According to the IMF Treatment of Crypto Assets in Macroeconomic Statistics, crypto assets such as Bit…

What I love about the Bitcoin enthusiasts is how they picture it to be the be all/end all magical money that will solve everything Meanwhile the real big money-movers (legal or illegal) are still using bank accounts and paper companies in "business-friendly" jurisdictions.

Microstrategy was a public company that recently put its treasury reserves into 100% BTC from USD.

Why is this important: note "public." To do this legally, they had to convince: - external auditors - internal compliance - external/internal legal - and where it gets interesting: the institutional investors who are large enough to matter, i.e. your big-money movers. This party says no at a shareholder meeting, the conversion isn't happening.

CFO who led this found that last party were all ok with the move given explanation, and most owned BTC already. 1 holdout took some convincing. These big money-movers hold BTC already, in short. Yeah it's not 100% of their assets, but this isn't an argument about that.

Re: Digital Money Across Borders: Macro-Financial Implications

#62

Post by toomuchtodo » Fri, Oct 23, 2020, 6:09 PM UTC

jsmcgd wrote: post #18

bboygravity wrote: post #7

Earlier quoted context omitted.

I would argue that all of that is already more or less the case with the central banking system as we have it now: negative interest rates, money only insured up to 100k per person in EU bank accounts, massive decrease in buying power (look at the price of real estate/gold/crypto expressed in EUR/USD over the past 10 years), Dutch citizens pay "capital tax" over any capital over some 30k EUR (literally: spend it or w…

The difference, is that the CBDC will be even more centralized. To control currency flows requires the participation of many separate entities. With this new 'digital money' it requires only the participation of those who control the blockchain. ie political policy can be achieved programmatically, by having complete control over all currency transactions in a nation. This is very different from the status quo. It sh…

> People have no actual freedom without economic freedom, and this system will create a sword of Damocles that will hang over each and every person.

You cannot use technology to fix a people (in this case, political) problem. Codify your rights in statute and executive governance authority. Using a distributed ledger ain't gonna fix your laws and courts.

Re: Digital Money Across Borders: Macro-Financial Implications

#63

Post by kyboren » Fri, Oct 23, 2020, 6:32 PM UTC

bufferoverflow wrote: post #49

v4dok wrote: post #20

I was in many crypto presentations during the 2018 BTC rise. The crypto-anarchists (left and right leaning) were getting their spotlight and laying out their "dream". Basically an updated version of Kropotkin's and Bakunin's work for the blockchain-era. I really don't get what is the hate with the central banks getting control over the money. Yes they are not appointed by the Government but it does not matter, the mo…

> I really don't get what is the hate with the central banks getting control over the money Because every single CB in the world devalues the currency they govern. Bitcoin and other coins, on the other hand, are deflationary by design. Which means, while they can drop in value, they will not do so because somebody decided to turn the printer on and print a few trillion BTC. BTC is capped at 21 million coins. And some…

Bitcoin is not deflationary, it is disinflationary. The Bitcoin supply is still inflating, currently around 1.8% per year. However, that inflation rate will continue to fall to 0%.

Re: Digital Money Across Borders: Macro-Financial Implications

#64

Post by gamblor956 » Fri, Oct 23, 2020, 7:10 PM UTC

janoside wrote: post #56

raverbashing wrote: post #50

Earlier quoted context omitted.

What you're saying applies to crypto-currencies in general, but not necessarily to Bitcoin, which has some thorny issues. Yes, maybe the popularity of BTC will overcome the issues, but I doubt.

No, it doesn't. Money, perhaps more than anything else in human society, exhibits network effects that incline it toward winner-takes-all dynamics. Every money implicitly competes against every other money. I recommend taking a look at something like https://bitcointreasuries.org/ And don't just glance at it - try asking some probing questions, like "What does this mean?" and "What might I be missing concerning the u…

Money, perhaps more than anything else in human society, exhibits network effects that incline it toward winner-takes-all dynamics.

That's not how money works, if by money you mean a currency. Currencies are issued by sovereign governments, and don't exhibit network effects within that sovereign jurisdiction, because they don't need to. They're legal tender; you're required to accept them, and everyone needs them to pay taxes.

If you mean money as in wealth, that's an entirely different topic.

Re: Digital Money Across Borders: Macro-Financial Implications

#65

Post by gamblor956 » Fri, Oct 23, 2020, 7:17 PM UTC

seibelj wrote: post #44

janoside wrote: post #40

Earlier quoted context omitted.

The "market" is always active and always looking to select the best of everything, including money. Bitcoin isn't be-all/end-all magical money - but it is a massive, order-of-magnitude improvement on history's greatest "hard money" (gold). The markets of the world are slowly coming to understand the value of this "best reserve asset and best collateral asset ever seen" (Raoul Pal). A new digital, internet-native asse…

This is the history of all revolutionary technologies. At first it seems like a useless toy, then the establishment laughs at and denigrates it, then it's fought aggressively, then it takes over. I would say we are almost past the "fought aggressively" stage, at least for Bitcoin, and into the "taking over" stage as smart institutional money begins to get exposure. It's very interesting that a large contingent of sma…

They said the same thing about Theranos, too...In fact, the only time I've ever heard that quote is in reference to failing technologies and companies.

You'll never hear that quote about actually revolutionary technologies, because their revolutionary nature is immediately apparent, even if the economic case for the technology is not (at the time).

Cryptocurrency isn't revolutionary. There isn't any use case for cryptocurrency that wouldn't be easier to address with normal cash or credit payment. Cryptocurrency solves none of the actual problems in the current financial or banking systems but introduces a host of new problems that weren't issues in the old system. It's a solution in search of a problem.

Re: Digital Money Across Borders: Macro-Financial Implications

#66

Post by seibelj » Fri, Oct 23, 2020, 7:51 PM UTC

gamblor956 wrote: post #65

seibelj wrote: post #44

Earlier quoted context omitted.

This is the history of all revolutionary technologies. At first it seems like a useless toy, then the establishment laughs at and denigrates it, then it's fought aggressively, then it takes over. I would say we are almost past the "fought aggressively" stage, at least for Bitcoin, and into the "taking over" stage as smart institutional money begins to get exposure. It's very interesting that a large contingent of sma…

They said the same thing about Theranos, too...In fact, the only time I've ever heard that quote is in reference to failing technologies and companies. You'll never hear that quote about actually revolutionary technologies, because their revolutionary nature is immediately apparent, even if the economic case for the technology is not (at the time). Cryptocurrency isn't revolutionary. There isn't any use case for cryp…

You keep repeating the same tired arguments, then can't explain why Bitcoin went from 0 to $240 billion market cap in 10 years. There is clearly a lot of value here, even if you refuse to acknowledge it.

Re: Digital Money Across Borders: Macro-Financial Implications

#67

Post by gamblor956 » Fri, Oct 23, 2020, 7:59 PM UTC

seibelj wrote: post #66

gamblor956 wrote: post #65

Earlier quoted context omitted.

They said the same thing about Theranos, too...In fact, the only time I've ever heard that quote is in reference to failing technologies and companies. You'll never hear that quote about actually revolutionary technologies, because their revolutionary nature is immediately apparent, even if the economic case for the technology is not (at the time). Cryptocurrency isn't revolutionary. There isn't any use case for cryp…

You keep repeating the same tired arguments, then can't explain why Bitcoin went from 0 to $240 billion market cap in 10 years. There is clearly a lot of value here, even if you refuse to acknowledge it.

Theranos had a high market cap to, right up until the WSJ reporting revealed it to be a fraud. And on that note, there's strong evidence that multiple parties have been manipulating the value of cryptocurrencies, including especially Bitcoin, through various fraudulent mechanisms (see, e.g., Tether).

I also used to be heavily involved in cryptocurrency, when it first started, and what I saw then is a large part of why I don't see any usefulness in cryptocurrency now and why I'm convinced that it will never replace any part of the financial system.

Re: Digital Money Across Borders: Macro-Financial Implications

#68

Post by seibelj » Fri, Oct 23, 2020, 8:25 PM UTC

gamblor956 wrote: post #67

seibelj wrote: post #66

Earlier quoted context omitted.

You keep repeating the same tired arguments, then can't explain why Bitcoin went from 0 to $240 billion market cap in 10 years. There is clearly a lot of value here, even if you refuse to acknowledge it.

Theranos had a high market cap to, right up until the WSJ reporting revealed it to be a fraud. And on that note, there's strong evidence that multiple parties have been manipulating the value of cryptocurrencies, including especially Bitcoin, through various fraudulent mechanisms (see, e.g., Tether). I also used to be heavily involved in cryptocurrency, when it first started, and what I saw then is a large part of wh…

You truly believe that some scandal will result that drives Bitcoin from $240 billion to 0? And you were "heavily involved when it first started"? A lot has changed in 10 years, I don't think you understand this industry whatsoever.

Re: Digital Money Across Borders: Macro-Financial Implications

#69

Post by x87678r » Fri, Oct 23, 2020, 8:45 PM UTC

anm89 wrote: post #52

x87678r wrote: post #32

Earlier quoted context omitted.

The USA is super strict on making sure every transaction they can control gets monitored and tracked. Any financial firm that touches dollars must comply or they'll get fined literally billions. There is no way BTC will be allowed to go mainstream unless the US regulators can track every user on the blockchain.

Our "exorbitant privelege" is not going to last forever. When the imf called. For a new Bretton woods moment last week, ending that system is what they were talking about.

Yeah check out where IMF headquarters is and who pays for it then tell me again that the IMF is going to let BTC take over from the dollar.

Re: Digital Money Across Borders: Macro-Financial Implications

#70

Post by [deleted] » Fri, Oct 23, 2020, 9:13 PM UTC

x87678r wrote: post #69

anm89 wrote: post #52

Earlier quoted context omitted.

Our "exorbitant privelege" is not going to last forever. When the imf called. For a new Bretton woods moment last week, ending that system is what they were talking about.

Yeah check out where IMF headquarters is and who pays for it then tell me again that the IMF is going to let BTC take over from the dollar.

[deleted]