> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight.

I don’t think any of my family in Algeria are using Bitcoin, and same for my wife’s family in Bangladesh. In Algeria at least, generally you’ll go to a hawala money changer who gives you better rates than the banks and exchange your local currency into Euros. If you need to send money abroad you use the same old Islamic hawala system to send it to France or wherever else.

There will probably be some useful things built on top of blockchains, and I don’t think crypto has zero value, but I don’t think it’s going to reasonably fix a situation of a failing state.

How do you know the hawala systems aren’t at least partially based on Bitcoin now?

Yeah, and how many citizens of these countries buy and use BTC? Particularly with how unstable it is compared to other assets like e.g. gold.

Mind you, I speak as someone who is a citizen in a country that experienced that. Not now, but back in 2016, our currency got halved. Nobody, and I mean absolutely nobody ever thought "I should have bought crypto."

When the 2017-2018 crypto rush happened, and people started mining ETH, well-off people* here got onto it and started mining ETH.... only to immediately sell it as they mined. Nobody held onto it.

*well-off because GPUs were absurdly expensive due to the inflation, and it only got worse when the shortages hit.

EDIT: I also want to add that very, very few people here in my country actually understand what bitcoin even is (or cryptocurrency or blockchain). The people that I have seen support mining here only really view it as a way to earn some money while doing nothing.

This is quite spot on.

Cryptocurrency lately has become this techbro version of a white-savior complex, where we think this magic technology will somehow uproot the lower lesser classes from their eternal toil and discord, yet I've seen plenty of these kinds of folks either not bother to get in on this (because it's likely too difficult to comprehend) or lose their shirt because they didn't make it on the right end of a transaction and lost more money to some cryptocurrency-rich fat cat, laughing all the way to the bank.

“Techbro” “white savior complex” Do you actually talk like this or is it just the party line you spit out for virtue signaling points?

I mean yeah, technology has magically elevated the toiling masses from shitty work. When was the last time you worked in a factory for 16 hours a day? When was the last time you got scurvy as a sailor on a wooden ship? When was the last time you tilled a field with the trusty family oxen?

I'm dead serious. Your comment seeks to discredit my position, but I'm speaking my truth to what I see.

Sorry, but the bitcoin fans get condescending, acting like they can save us from those evil banks. Not a chance.

Technology that has improved society does absolutely exist though, like the world wide web, which has proven potential and has revolutionized the way we do business and commerce.

Cryptocurrency on the other hand is just an ancap wet dream. You are free to disagree with me, but bitcoin has been around for 12 years now and, yet, I see no killer application that doesn't involve some kind of grift. In the same period of 12 years, from the start of the WWW to around the early 2000s, so much innovation happened by comparison.

> Cryptocurrency on the other hand is just an ancap wet dream.

My exact thought upon reading the Slashdot article announcing the release of v0.3 of this thing called Bitcoin back in 2010. The last decade has only reinforced that view...

It scares me how much of a cult following Bitcoin specifically has. I just saw a post go up on /r/bitcoin about a butter who sold her house for freaking Bitcoin.

I'd hate to be her when (not if) this goes tits up.

Madness. I would hope that it's still a troll but it's not like we haven't seen people do the same thing for all kinds of get rich quick schemes past and present.

Exactly. This is basically digital Amway haha.

So the guy who uses the racist phrase “white savior complex” non ironically, who only admits technology is useful after it has undeniable global appeal, is supposed to be some barometer if a technology will be world changing? Frankly, you can’t possibly know until the dice stop rolling. Just like the internet, or the barcode (look up the guy who invented it, his story is cool.) Fact is it’s too early to tell what impact Bitcoin will have on history. Your self righteousness prognosticating just shows your ignorance of history, humility, and sound reasoning. According to you something is only useful if it has already demonstrated its use, like the web. Well duh, of course the web is useful. You’re not exactly Nostradamus with that one. Will Bitcoin be useful? Maybe, maybe not. Time will tell. Edit: s/p

Eh, can you tell me what the killer app is supposed to be? I'd like to know. Because in 12 freaking years, there has to have been something better than "lets kill our planet as quickly as possible while early adopters get rich".

So to talk about the killer app we’ve got to differentiate the technology from the first use case, which is digital gold for now

Ethereum goal was to allow people to build different types of dApps by opening up the number of op codes on the virtual machine - this allowed people not only to build bitcoin on ethereum but also other types of apps - like Uniswap (Exchange), Compound (Lending) and dydx (derivatives). These are just a few. There’s a whole other world of NFT’s that is also bubbling up now. Aragon is building a DAO creator and launcher where you can build and run organisations in a digital jurisdiction.

Now as the World Wide Web decentralised the power to distribute information via a protocol, Blockchain’s can allow that for anything that requires trust - such as finance

Though the biggest limiting factor is still scalability of Blockchain’s but the Ethereum team and a bunch of other teams are solving that by being at the breeding edge of mechanism design. Ethereum realised Blockchain’s aren’t scalable and are bad for the climate long long ago - and already have plans to move away from PoW (energy intensive) to PoS (not energy intensive)

P.S - I got into bitcoin early because believe it was a hedge to inflation - realised it isn’t really a value add to society and have been dabbling with ethereum projects since 2016

I get the hate HN has for bitcoin - but deflationary assets are a use case especially when central banks believe they can pump infinite money. Nobody knows where this will end but your best bet is a deflationary asset

I love tech and finance - I believe the next decade we’ll see finance being disrupted by these protocols as ethereum moves to PoS

Also, this statement you made.

"Ethereum goal was to allow people to build different types of dApps by opening up the number of op codes on the virtual machine"

Let me tell you, laypersons won't understand a word of this at all. :)

sumgame, I appreciate this long and detailed response, as well as your insights. That said, here's why I think cryptocurrencies (specifically the underlying blockchain concept) are mostly redundant to us. The answer might surprise you, because it's less about technology and more about human nature and social engineering.

For something like blockchains adding "trust" to finance, I have one big problem with this. Humans on both ends of the transaction still need to conduct their business honestly for this to work. Sure, the so-called smart contracts system, like the one found with Ethereum, allows you to write an immutable record to the blockchain that dictates whatever terms and commit it to what is essentially a distributed append-only database. Additionally, if you make a mistake on a smart contract, d'oh! You basically can't change an immutable record. You'd have to append over it with a fresh one, which, depending on how energy intensive this blockchain application is, contributes to unneeded waste.

Here's where my personal issue is at with all this. Say you decide to take receipt of a delivery from Timbuktu for some fine vases. You receive the items from said vendor and, despite the entry clearly describing what you were supposed to get, you in fact get scammed with a delivery full of sand. So, what do you intend to do? The ledger can be as specific about a transaction as you want, but this won't stop dishonest people from being dishonest. So then you can settle it in a court system, bring the parties to task, and... oh wait. Why did we not just simply use a regular database and time tested ERP systems that have done the job for ages?

I guess what I'm really getting at here is that blockchain isn't some magic bullet that will guarantee specific outcomes in commerce, and in fact, feels like a different way to do the exact same thing we've done forever, but we need to cater to some kind of NIH syndrome.

Back to cryptocurrencies, why do we need so many different tokens out there in existence? Aren't they all trying to generally accomplish similar tasks? That also adds a ton of confusion and consternation, with everyone claiming how their particular cryptocurrency project is truly the best and why you need to use it over INSERT PROJECT HERE.

Fintech is an interesting space to watch, but I see way more projects with less than pure intentions trying to see if they can make out like a bandit down the line.

The world wide web, by comparison, is (and by some sources... was) a truly democratic medium. I'm not sure the same thing applies with cryptocurrencies and blockchain, which all feel like solutions in search of a problem (or projects in search of money from FOMO-riddled folks with nothing better to do).

EDIT: To your point about Bitcoin being digital gold. Yeah... it's nice sounding in theory, but at least with real physical gold, it can survive till the heat death of the universe and doesn't require the constant consumption of resources to maintain it (which I find egregious and unconscionable), as well as not requiring an active internet connection. I'm not a goldbug either, but I can at least concede to gold having a handful of intrinsic properties which lends to it being a hedge in its own right, agreed on over thousands of years in human history.

You got me there. I see a lot of cool possibilities, neat ideas, but no killer app. It’s all too complicated. But how long was that the case for the web? Decades? Even circa 2009 when I last did public facing IT work, many people were still talking to their mice. I’m not saying Bitcoin will be any more than a interesting diversion, but much like the web, it is far far too early to tell if it will just be a TempleOS style wet dream, or something that utterly shifts the landscape of the how we live our lives. (I’m also fascinated with how COVID is reshaping our planet.) When was the last time something changed how all of humanity lives their lives, globally, in a short period, before COVID? The internet? Electricity? What were some other big ticket changes you guys can think of?

Edit: I’m a horrendous speller. Damn home schooling. Edit2: mobile debating is hard, on both sides of the podium.

Ok so HN is a bit annoying as I can't really reply to things you said directly now... but let me break a few things down.

Firstly, did we like become best friends or something? I love how you described homeschooling haha.

Secondly, really just want to say, yes... perhaps my use of the phrase "white savior complex" is a bit cringy and social justice-y, which I'm actually not really part of that camp. I'm just applying that based on some observation of what I see. I just wish the socio-political crap would mostly go away and let the technology of blockchain/bitcoin/whatever stand on its own. Some of the proponents I mentioned earlier in the thread also just make my skin crawl a bit. There is inherent dishonesty in their gospel, I personally feel.

I'm simply trying to point out what I feel is a dangerous game they play, especially with the massive boom and bust cycles bitcoin and its ilk undergo.

I'd feel far less cynical if there wasn't some pyramid-esque (no, bitcoin itself is not a pyramid scheme, but the community and proponents surrounding it make it feel like one in many ways) action going on around it, like all the activity between BTC and tethers and other shitcoins that makes it all look like painting the tape.

I'm of the opinion that currently, this all feels like a redistribution of the wealth in a weird casino like fashion, and not a legitimate growth in real value. That's just me though. For every rich-on-paper cryptocurrency fan, there are also plenty that have lost their shirts in this experiment.

Hope this ramble made any sense. I really appreciate you chiming in, imwillofficial.

Btw read your new comment below mine. Thank you for being a good sport about all this. Please note, I will never personally attack someone I disagree with. I just get a bit heated sometimes. :)

You’re good! And I hope I did not offend. You seem like a kind and thoughtful person. Talking to you has been a lesson in going into a conversation without assumption. Thank you for that. I can be like a bull in a China shop sometimes. Well meaning... but I sure hope you didn’t have any dishes you liked

Dude you're totally fine. No offense taken.

I'm actually of the opinion that I need to be offended once in awhile.

It makes me think.

I've only been adding content. I haven't changed any of my positions. Working on a mobile it's a bit hard when you return carriage and sometimes I post anyway.

^ I feel ya there. I’m running into the same thing

P.S I was also homeschooled myself. high fives

I loved it because I got through differential equations and had something like 7 math credits... ::looks around suspiciously:: I may have... never written an essay.. Sometimes the free wheeling “do what you want” kind of home schooling can bite you. But we’re figuring out this whole English thing pretty well between us! ::high five::

> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight

At best, this argument turns Bitcoin into a massive subsidy by stable countries of unstable ones. A subsidy paid for in the form of higher energy prices, environmental damage and opportunity cost.

A car used to cost 2BTC, then 20BTC, and presently some 1BTC. Bitcoin isn’t exactly the model currency for stability.

You achieve stability through diversification, not by buying all stable assets.

It's kind of like saying you don't want to buy an index fund because there are some really volatile stocks in there!

Remind me again, are we talking about an asset or a currency?

It depends what your argument is.

If you are arguing that bitcoin is a bad currency because of high transfer fees, very few merchants accept it and that very few people are actually buying things with it in any meaningful way, then that's wrong because it's an asset.

If you are arguing that as an asset it is purely speculative and has no fundamentals and zero return other than appreciation, then that's wrong because it's a store of value.

If you are arguing that as a store of value it's actually highly volatile and has experienced multiple serious crashes, then that's wrong because it's actually a currency.

This is the primary tactic Bitcoin seems to use to deploy to combat any criticism - if someone critiques its ability to do one thing you claim it's something else..

Depends on which problem of bitcoin they are currently defending.

it is both and neither, it has properties of both, it also lack lack some properties of both

Do you not view the USD (or other currency) you hold as an asset?

Currency isn’t an asset. It never has been and it’s not intended to be.

The US dollars' value is comparatively stable...

Bitcoin is an asset that is designed to become a currency.

Another reason why every asset is going up right now: https://fred.stlouisfed.org/series/PSAVERT

Savings rates have exploded, and those funds need to go somewhere.

Is the arrow of causality that way, though?

I'm at the traditional "first-time-homebuyer" age, and I'm personally saving a fair portion of my income primarily because assets, such as houses, are so expensive. Were housing cheaper, I'd be paying a mortgage instead of a saving account.

(And, I'd argue, sending longer doing so too due low interest rates.)

It includes home purchases, so that would not be a factor.

As per the earlier link:

> Personal saving is equal to personal income less personal outlays and personal taxes; it may generally be viewed as the portion of personal income that is used either to provide funds to capital markets or to invest in real assets such as residences.(https://www.bea.gov/national/pdf/all-chapters.pdf)

Looking at both, it looks like the gradual decline in the savings rate since the early 1980s correlates with a gradual decline in inflation from that time: https://www.macrotrends.net/countries/USA/united-states/infl...

Aah yes, paying a $25 transaction fee to buy a $5 loaf of bread at the grocery store with bitcoin. Perfect.

There are other safe-havens against inflation which have existed for hundreds of years. Bitcoin didn't invent the concept of an inflation hedge, and the citizens you refer to had and still have standard alternate solutions. Which in all honesty are a lot safer than a digital collectible token with no intrinsic value that's primarily used for speculating and drug deals, which can be regulated, shut down, or taken over whenever your or another country wants to shut it down.

Bitcoin is by far the best hedge against inflation. All assets tend to zero in Bitcoin terms, long term.

This has been true for the last 12 years and will continue to be true.

This is groupthink propaganda nonsense. Bitcoin can only do 1.5KB/s of transactions and the average transaction costs $26. Any rapid decrease in price will lead to rapid decreases in mining and thus transaction throughput. Does this seem like the future of financial transactions to you?

Transaction throughput doesn't depend on network hashrate. It gets adjusted to keep fixed througput.

In the short term it does. The block difficulty adjusts but not immediately. If hash rate drops rapidly, the time between blocks will lengthen, the time to adjustment will lengthen and the throughput will drop.

Yes. Bitcoin adjust difficulty to hash rate every two weeks. So if you drop hashrate more rapidly than that you can have lower transactuon throughput for up to two weeks. One on average.

> All assets tend to zero in Bitcoin terms, long term.

Good luck with _that!_

> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight.

Yeah, it's almost as though they had invested in Bitcoin during one of its crashes. What do you think they will say next time Bitcoin crashes back to 10% of its value?

That they were foolish for holding onto Bitcoin itself. That's not what it's being used for.

Here in the West there's basically no barriers for someone like me sending $10k or $10 million wherever, for whatever. Just ensure I pay any taxes on investment profits, and don't fund terrorists or drug cartels. Many countries are far more strict. E.g., Argentinians can only move $300 a month out of the country legally, as I understand it. If they want to purchase real estate in Canada or Australia as a hedge against inflation, for example, that can be very hard even if they have the funds.

Getting around capital controls seems to be a niche for Bitcoin. I can think of few other ways to simply send $10,000 from Argentina to Nigeria in one hour, reliably and securely. Assuming people can exchange Bitcoin for cash or similar on both ends, it can be near-ideal for certain pairings compared to the legal and traditional financial system.

> Getting around capital controls seems to be a niche for Bitcoin

Q: If you pitch up in, say, Canada or Australia, and offer to buy a chunk of expensive real estate and pay with Bitcoin, who is selling?

Q2: ... or do you have to convert to AUD/CAD first, and if so, which bank(s) can you rely on to not worry about KYC?

Q3: ... or do you have to actually travel to Canada or Australia first, in order to open a regular bank account first, in order to have somewhere to move your Bitcoin to, in order to have local currency, in order to be able to pay the local seller?

I do know that people have transacted real estate in Bitcoin in Canada before, mostly as a gimmick, but no reason you couldn't do that legally on the Canadian end. But I assume one would convert to CAD. What's the problem with KYC on the Canadian bank end? Canada has no such controls and wouldn't care that the money was laundered out of Argentina.

Even if you had to do that, laundering the funds into Canada unfortunately does not seem it would be difficult in practice, given the apparent scale of money-laundering associated with the Vancouver housing market. And you do not have to be physically present to acquire property in Canada.

> laundering the funds into Canada unfortunately does not seem it would be difficult in practice

Is this true only if you're sufficiently under the radar, or does it still hold true no matter how big/famous/wanted a criminal you are?

EDIT: see

https://www.step.org/industry-news/canadian-citizens-challen...

and

https://www.fintrac-canafe.gc.ca/guidance-directives/client-...

??

Of course some people get caught. (Though some of what I'm describing wouldn't be considered illegal under Canadian law in the first place. You can just buy property with BTC here if you have BTC.) Still, it's a huge problem:

https://www.cbc.ca/news/canada/british-columbia/cullen-commi...

https://globalnews.ca/news/7593419/bc-casinos-too-dangerous-...

Western Union operates all over the world, you can send money instantly and the fees are lower than Bitcoin's network fees for transactions.