Surely there is a middle ground between "every single transaction that has ever occurred in the history of the blockchain is public and visible to all" and "no transactions are ever visible to anyone including governments investigating crimes that have exercised due process in obtaining warrants and subpoenas".
Electronic money of whatever form is equally trackable regardless of the value of the transaction. That forces a world where either you can drop country-destabilising quantities of money anywhere without any law enforcement or every microtransaction ends up in the security services database.
Anonymous billions are all fun and games until the second plane hits the tower.
What? security services can only spy on money, but just can’t do their main job of preventing attacks by humans?
Maybe we should hire a competent replacement for that job then.
But you can't just hand wave concerns regarding money laundering and other criminality away. If you want to, you should just say "these things don't matter that much", but don't just avoid them entirely.
>Lastly, we reserve the right to manipulate the money supply. It's enough for you to know that we are experts and have your best interests in mind. You don't need to concern yourself with how much money there is, how its supply is managed or the potential negative effects of our manipulation, you wouldn't understand the implications anyway.
You mean to say that we live in a democracy. We elect our representatives, and they pick who runs these institutions. They are relatively "undemocratic" because when politicians are able to manipulate the interest rates directly, well things are perhaps even worse.
I'm not, I'm pointing out the rhetorical techniques being used to delegitimize people who try to create privacy tools.
You mean to say that we live in a democracy. We elect our representatives, and they pick who runs these institutions.
It's a pernicious myth that there is some meaningful democratic oversight over monetary policy. Central banks are privately owned and/or structured in such a way as to not be beholden to political pressure (for the somewhat justifiable reason that politicians are even worse at managing monetary policy).
Latinate words are not a useful cover when you're lying. All Western central banks are effectively a branch of government and are directly responsible to Congress/euparl/$local_variant, and are run by a bunch of politicians (the chair of the Fed is Powell and the president of the ECB is Lagarde, ffs).
The notion that they aren't beholden to the popular will is just ridicolous.
Central banks in most developed nations are institutionally independent from political interference.
"The governance of central banks has two dimensions: corporate governance and public governance. Public governance is an institutional framework whereby the general public governs a central bank by and through the legislative and executive bodies in a country (...)".
"Independence of the central bank" means independence from direct intrusion by the executive branch, in the same sense the judiciary is independent from political interference.
That doesn’t mean that those are not government institutions.
The Federal Reserve (by far the most important one) is privately owned, as are Belgium, Greece, Japan, South Africa, Switzerland, Turkey and the Bank of Italy.
The ECB is owned by central banks of member states, some of which are privately owned.
Private ownership is any case one issue, the other is the fact the CBs are structured in such a way to be resistant to political pressure and (meaningful) oversight.
This is a good start:
MMT requires the government to raise taxes once inflation starts rising due to previous money printing.
What are governments doing now? They are actually thinking of handing out more money to people to offset the effects of inflation (thereby making the inflation worse).
In other words, MMT requires governments to always do the right thing, which they don't.
That's ignoring the theoretical underpinnings of MMT which are by no means unassailable.
That’s a common misconception. Have you seen any MMT economist advocate a tax increase recently?
Here is an excellent podcast with one of the most eminent MMT scholars Randall Wray discussing his recent publication on how to deal with inflation in the US currently:
https://realprogressives.org/podcast_episode/episode-173-inf...
Here is the publication:
https://noahpinion.substack.com/p/examining-an-mmt-model-in-...
> MMT, for those who aren’t familiar with it, is a small, cohesive group of people who go around telling the government to borrow more and spend more.
Which is fundamentally incorrect and betrays a misunderstanding of MMT so his opinion is irrelevant
Actually you can. The war on "money laundering" is a total failure. Those laws costs billions of dollars in compliance, stifle competition, harm innocent people by excluding them from the financial system (estimated 1.7 billion worldwide) and don't actually stop criminals. There's a serious case to be made for putting an end to that war and diverting those resources to old school crime fighting.
https://www.cato.org/blog/money-laundering-laws-ineffective-...
This represents a massive misallocation of resources. Public safety would almost certainly be improved if we doubled police spending by slashing AML burdens by 2/3rds.
Unfortunately it's hard for politicians address crime by raising taxes to fund real police but easy for them to attempt to address crime by increasing AML regulation, even if the latter is barely effective.
[1] https://www.oxfordeconomics.com/resource/cutting-the-costs-o... [2] https://www.statista.com/statistics/298637/united-kingdom-uk...
I'm totally against money laundering. It takes the money away from us people for streets, school and healthy care.
And crypto is not providing any solution to this at all. So why not fixing that issue inside the crypto bro fan club first and than trying to replace our current fiat with it?
I think you're confusing money laundering and tax evasion.
I think it's important to expand on the above because the above terms are tame. They give an impression of individual small time criminals.
It's North Korea, Russia, dictators and despots across the world, the cartels, organized criminals. Large scale Tax avoiders, human traffickers, drug traffickers, weapon smugglers. It's the organized big money criminals, both high and low class that fund the worst aspects of humanity.
(Talking about Bitcoin here. Not all crypto applies)
D'you think an "ordinary person" is going to risk being thrown in a gulag?
The problem with all these tech utopians is they think the relevant problems are technical: we've solved trust! (Between machines negotiating over a network). We've solved currency manipulation (oh its not a currency, it's an asset; and oh it can be manipulated by the 3 people who own 50% of it).
All the problems are social, not technological. And crypto makes all of them worse! By an order of magnitude worse.
They can try, but it's very difficult to do. I hear we'll win the war on drugs any day now.
All the problems are social, not technological
No solution is 100% social or technological, you need both. The existence of cryptocurrencies doesn't remove the need for social coordination.
Is a worse situation, right?
Crypto is just fedualism with land=coin. Really. That's what it is.
It's about as anti-freedom as one can imagine. It's "freedom in form" and not in content. It's the freedom of the colonizer on new land, and the oppression of all else who live there. A necessary oppression, not open to revision, and executed by machine.
Satoshi advertised the currency and the start of mining beforehand, to give other people a chance to participate. There was no pre-mine.
In the early days there were faucets that handed out bitcoins for free.
Due to the boom and bust cycle of Bitcoin, many of the early holders cashed out instead of holding all the way to untold wealth. This is actually a nice side-effect of the early stages of Bitcoin adoption.
Very early holders of Bitcoin had to take the risk that the currency was somehow flawed and would go to zero, in some sense, the gains they made are a function of the risk they took.
The solution to wealth inequality is not to force everything to be equal, it's to allow both upward and downward mobility. The wealthy must be allowed to fail and not be bailed out.
Interestingly, bailouts are a common feature of the fiat monetary system.
A deflationary asset, like land for example, is not a good currency. As a powerbase, it's called feudalism. And that's not a good politics.
Power in crypto is radically centralised to the owners, not the users (unlike democracies).
One has to imagine people like you know this, or feel it, in the lust for the value increases to your own stake: that is, a lust that you are the one in control. Either way, you're playing the role of a daemon here, whether you realise it or not.
And the devil you are putting on the thrown are a handful of billionaires with power and control executed by a machine.
Thankfully bitcoin has no army, and all of this will fade into the obvious malicious stupidity it already is.
I wrote about Bitcoin, not Ethereum. There are lots of Bitcoiners that think Ethereum is a scam due to the large premine and larping as a decentralized project.
Either way, you're playing the role of a daemon here, whether you realise it or not.
And the devil you are putting on the thrown are a handful of billionaires with power and control executed by a machine.
The fact that you have to start using flowery religious language of condemnation appears to me an indication that you're running out of logical arguments.
Thankfully bitcoin has no army
That's one of its features, which proponents value.
Then some people comply and some don't
The ones who are paying for these open ponzi schemes by having their electricity stolen by the state?
How about El Salvador, or Argentina, or Nigeria where the poorest lost significant chunks of their capital from btc crash to terra/luna collapse.
You may dislike the way central banks control and manipulate the money supply, but the reality is that an unmanaged currency is generally a disaster for everyone. To fulfill its role as a stable store of value, a currency has to be managed. The notion that an inherently deflationary unit of accounting (such as Bitcoin), or a completely unmanaged one, or one subject to "management" only through crowd action (as in true Defi) can achieve this is delusional.
What do you think will be worth more in 100 years from now? 1 US dollar or the equivalent of gold? How about 500 years? 1000 years? My money is on the gold.
Every fiat will be stable until it blows up. It will necessarily be mismanaged in a long enough time line, and based on history it really isn't that long.
The only limits on the gold supply are technological ones. If one takes an optimistic view of the future where we become a space-faring species the future supply of gold is effectively unlimited.
Edit: As much as I'm a huge crypto detractor, at least Bitcoin's supply is limited mathematically, not just circumstantially. I would argue this is a bad thing, but if you're looking for something that will hold its value due to scarcity a durable commodity we dig out of the ground seems like a bad long-term bet. What if we discover a massive gold deposit?
Right, there's nothing special about it besides the technical limitations. But what's the alternative? With fiat you still have those technical limitations (someone could create indistinguishable counterfeit money and dump it on the market). But there's also the political risk. Someone can get power at the Fed and decide to double the money supply over night. In fact, this has happened time and time again with many fiat currencies so its not exactly an unfounded risk. That's why the precious metal standard is lower risk for arbitrary manipulation
I think there is more than technological limitations to making this happen. Not only is counterfeiting considered a major crime by the state (who has a monopoly on violence), but the amount of "money" in circulation that has a physical representation is dwarfed by "money" that does not. Even if you doubled the physical currency in circulation you'd only increase the "monetary supply" by 10% or so. Plus there are huge logistics issues with moving that much weight/volume without getting caught.
> Someone can get power at the Fed and decide to double the money supply over night.
I think that if the function of government breaks down to this extent, I will have bigger problems than currency devaluation.
I don't know how to tell you this but...
And it's not like precious metal based currencies were stable over long periods anyway. There is nothing in the working of economies that guarantees that precious metals will accumulate in sync with economic growth and contraction. Trying to tie one to the other is every bit as much "fiat" economics as an untethered currency, like the dollar.
But they don’t optimize for “stable store of value” over “full employment” or “hidden taxation through monetary inflation”.
In fact, they have the opposite goal because “the velocity of money” is negatively influenced by people using money as a store of value. Keeping money in a savings account and collecting interest is bad for society because reasons.
How? Due to it being a PoW system?
Suddenly fraud is no longer possible? (It still is)
Money laundering is no longer possible? (It still is)
Inflation/Deflation save? (It still is)
So tell me, what is crypto fixing?
That instead of experts in the central bank the market itself just does what? Definitely nothing pro consumer.
There are reasons why banks get requirements from the state on how they need to run and it's most of the time for us consumer/small people.
It allows people in Lebanon (~200% inflation), Zimbabwe (~700% inflation) and Turkey (70% inflation) to maintain the purchasing power of their wealth and to protect it from confiscation.
There are many other advantages of Bitcoin, but these are already significant.
Nothing new here.
And yes sanctions against north Korea or Russia are more important than the inflation of Lebanon, Zimbabwe or Turkey.
And I still bet that the people in Zimbabwe in avg have more from less co2 than from bitcoin
Impoverishing entire nations by making sure they can't buy necessary goods and thereby putting them at risk of starvation is more important than other nations who are impoverished and at risk of starvation due to their currencies collapsing.
The normal people of that country are btw not able to just buy crypto. After all someone still needs to take their money to exchange it and they need hardware and knowledge.
You sound like crypto would just solve those issues just because it's there.
You mean a cellphone? Which pretty much everyone in the world has?
Btw. You should read up more on how well Bitcoin works in El Salvador.
And of course all the other points I brought up are still valid as well.
I'm starting to think there's a good argument for the US treasury trying to export financial stability by making USD holdable globally. Except that runs into the policy problems relating to who's using it.
Just because you believe money is printed as much as the dark secret super elite group wants it be printed?
Ah yes the sseg.
But yes we are still living in a democracy (a lot on hn at least) and the solution to all of these problems definitely are not getting solved by crypto.
You as an avg joe you are much better off with our current fiat system. The money they collect is used for a lot of things you depend on.
You might be totally ignorant to this but just switching to crypto doesn't solve a single problem.
Democracy is a nice value, but so are freedom and human rights. I expect to have the right to buy crypto or not.
I only argue about wrong crypto bro arguments.
Feel free to invest in whatever you want but in these discussions cryptobros argue from crypto is the future and is better than fiat.
Be aware though about the energy consumption of BTC. The GPU shortage and Asics garbage it creates.
I would have loved to buy an rtx GPU over people gambling on the side.
I’m working in a legal-but-taboo industry, where mastercard and visa don’t want to deal with us, which is a huge pain in the ass - but every time I’ve looked at crypto, it seems to fix one or two problems and introduce 10 more...
Central Banks are privately owned and by design are meant to be "independent" of politics (otherwise politicians would use the money printer to continuously to buy votes, destroying the currency in the process).
There is no real oversight over central banks and nobody (outside of the peanut gallery) has meaningfully questioned the extreme central bank policies of the last 10 years or asked the central bankers any uncomfortable questions.
The Bank of England has only been independent for a pretty short time, for example, so central bank independence is a fairly new concept that could change again - because it is a political decision, not a law of nature.
The US fed is by far the most important Central Bank due to dollar being the global reserve currency.
Source: https://www.quora.com/Is-the-European-Central-Bank-privately...
EDIT: The ECB is owned by member-states's banks, some of which are privately owned.
In any case, private ownership is only one issue, the other is that central banks are designed to have very little oversight.
Saying that "we can change the laws" doesn't change that. It's not always easy or possible to change laws. When is the USA going to repeal the 2nd amendment?
And, of course, the ownership of the Fed (or the ECB) could be changed by changing laws (the Bank of England is an example here of how central banks might enjoy changing degrees of freedom).
Addendum: to say that it is not easy to change the law is ok, maybe it should not be. But to use some technology to get around laws where there is not enough social capital for change is a very tricky position. If that holds for law X, why not law Y? What if there is never enough social capital for change? Would it then imply a break-up of that society into multiple ones?
Conventional banking combines a moderate level of privacy with effective measures against money laundering. Why shouldn't we ask that crypto be judged against this baseline?
"Based on 2009 data, the UN, with US State Department assistance, calculated the global success rate of money laundering controls at just 0.2 percent (UNODC 2011, 14, 119, 131), but, as noted above, the confiscation rate might be 0.07 percent. In other words, despite ubiquitous money laundering controls, criminals retain up to 99.93 percent of criminal proceeds."
https://www.tandfonline.com/doi/full/10.1080/25741292.2020.1...
Rather fake than moderate, I would say.
https://moguldom.com/351338/fact-check-do-jp-morgan-chase-we...
As long as banks can just pretend to protect my privacy, while they sell my data, I feel more comfortable about the type of privacy that cryptos like monero provide.
> Why shouldn't we ask that crypto be judged against this baseline?
Why shouldn't we ask for a reasonable baseline that really protects people's privacy and not just some corporate version of "privacy™"?
> effective measures against money laundering
Just yesterday, Deutsche Bank's HQ was searched over possible money laundering.
(i) get enough people on your side to change the society you are in; or
(ii) move to a society that operates closer to what you want
Technological escape hatches are probably at best a stop-gap measure, but not a replacement for (i) or (ii)
Privacy-coins could be the next big one. It switches accounting from being a tool of coercion (c.f. the famous case of the Canadian truckers) to something like air which just cannot practically be denied.
If politicians banded together and behaved like civilised adults then crypto would be worthless. But they aren't about to try that sort of radical change, so this tech might actually solve a lot of problems. With something like Monero I really do not see, at any level, how they could stop me doing stuff like donating to political causes I agree with. That is scary in some ways, but there is also reason to be optimistic.
If your fellow citizens in aggregate really don't like what you do and want to stop you, the will eventually find a way. You want a society that does not police where money flows - which is a big change and there is no evidence that broadly people like to open the taps on things like terrorist financing, slave trading etc. So there will likely be some limits that societies like to enforce.
And of course they could attack crypto by taking over mining, policing any sale of hardware, making touching any crypto a felony, clamp down harder on any cause you want to donate to, etc. They might not win completely, but they might make things pretty uncomfortable for most that would want to use it.
Democracy is a very powerful technology, no argument there. But it can't overcome technical realities. It is better at adjusting to them and giving up when the cost gets too high.
And no, technologies do not freely diffuse through societies, some stuff remains pretty firmly in highly policed boxes when the cost of letting it run free is deemed to high (can you just go buy nuclear weapons, for example?). Who is to say that the cost of banning crypto would be too high - I have not seen the evidence for that (also not really for a ban, either)? That is a political decision, not a technical one. And, yes, there can be bad decisions with really high costs, no doubt.
Yep. Happens regularly.
> ...or pay for it to change?
And nope, certainly not. But crypto will fall into the same category - stamping out the ability to do the - rather simple - necessary maths would require horrific compromises that are simply not supportable. This technology has radically altered the power balance of moving funds around. Sure that isn't sunshine and roses, but at least we don't have to worry about so much about asset freezes.
Plus asset freezes are on the cards for shutting down protesting truckers. If we're living in a world where the Canadian government can attack truckers (of all people) with asset freezes why can't it happen to you or me? I don't see the much difference between myself and a Canadian trucker. I suppose I couldn't handle working hard for more than about 6 hours at a time.
I can believe that for some people the topic is high on the agenda, but really "most"?
I generally agree with you but don't understand this example: the concept of an LLC is not a technology that stands against law in a way that forces the law to adapt but is a construct that only exists by the grace of law... like, what would it mean to illegally form an LLC in a world that didn't agree with such actions?
A country that doesn't adopt LLCs or some similar method of pooling risk will tend to get overrun by a country that does. So people can try to stand against the tide by not allowing pooled risk and capitalism, then 50-100 years later the capitalists role over them because the wealth gap has gotten so large there isn't room for meaningful resistance.
Kind of like what happened between the USSR and the US, or Europe v. All Other Civilisations. You can technically choose not to use the legal ideas, but that is really just choosing to be overwhelmed by more organised groups of people. Much like how a military that refused to use guns would get overwhelmed by one that does.
Like I said upthread, this lasts until the second plane strikes the tower.
The invasion of Ukraine by Russia brought a huge, unprecedented wave of financial sanctions. If cryptocurrency actually worked for private, uncensorable transactions, they would have shrugged this off and moved to Monero. Perhaps we shouldn't rule this out. But remember the level of law changes to privacy and surveillance rolled out after 9/11 as well. We've not yet seen the first terrorist attack that would not have been possible without uncensorable cryptocurrency funding; the response to that will be something to behold.
This doesn't work. All countries are pressured to adopt the same compliance and framework. OECD, IMF, WEF, and other world organizations will successfully force same reforms everywhere.
The IMF immediately told them that they would no longer be elligible for any IMF loans or financial transactions until they sold all Bitcoin they owned and rolled back the Bitcoin legislation. And the kicker, El Salvador bought and held XX million dollars worth of Bitcoin (last I checked), while their GDP was XX,XXX million dollars, and the loans that they roll were for X,XXX dollars.
There aren't many other players at nation state level like the IMF... so they can exert a lot of pressure on monetary policy. If you want another example, look at how the IMF dealt with Greece.
a 2-3 verified examples will suffice, tia.
The banking holiday was declared in Cyprus, banks and ATMs shutodnw, everyone local is locked out completely, meanwhile deposits were drained by the rich international depositors thru oversease branches that remained open.
Why do you love defending the indefensible so much? Take the L and move on.
Was what happened the best possible result - probably not. But I would say that goes for all European responses to the financial crisis then - but that is not the same as being totally indefensible. The question has to be: what outcome could we have now that would be better and what should we have done then and could that have been done? And with Cyprus one issue is the smallness of the economy, which meant what a US might be able to do might not be possible for them on their own.
EDIT: and one of the issues in Europe certainly seems to be that broad, untailored measures are not very popular even though ex-post they appear to perform better - so popular opinion does matter
Who really would be fine with giving the government 10% of their money, so they can pay their gambling debts?
They offer money, but with strings attached. Either the country conforms or it doesn’t get the money.
Yes. Germany is the highest user of cash in G-7 and has radically different views on privacy from other G-7/G-20 country, doesn't even have a centralized citizen register.
They have very little in common with Italy on many aspects, and certainly standards would vary as well.
But what does it matter? You think supra-national organizations actually care what some little people think?
Edit: German citizens are all properly in registers, more local, but very registered nonetheless. You need to have government ID by law. Plus there is a national tax ID.
FATF is an unelected, undemocratic body, where you have absolute monarchies like Saudi Arabia and authoritarian states like Russia audit the free/democratic/morebuzzwords West.
I can only imagine you think voting matters too.
It doesn’t, never did.
[0] https://news.ycombinator.com/item?id=29867057
[1] https://news.ycombinator.com/item?id=28441794
There are some things that are plain illegal. If you’re laundering money, selling illegal drugs, running guns, funding terrorist groups, etc you run the risk of getting caught and having your accounts shut down.
We’re not living in a dictatorship (yet). There’s still due process and the justice system.
Lastly, we reserve the right to manipulate the money supply.
“In our time, the curse is monetary illiteracy, just as inability to read plain print was the curse of earlier centuries.” — Ezra Pound
If you’re interested in how money works you should read a book or two about it. It’s pretty interesting. “The government,” isn’t “printing money.”
Absolutely concern yourself with it.
The problem right now is that government regulators aren’t technically savvy enough to understand cryptocrap and it’s implications. They read what briefs they can but they face endless technobabble from lobbyists and “industry representatives.” The hearings with the US congress were something else.
Funny how people here assume we all live in the same country. There are lots of people on HN who live in dictatorships.
If you’re interested in how money works you should read a book or two about it. It’s pretty interesting.
Thanks for the condescension. Money printing is a colloquial term used to describe various ways in which the money supply is manipulated by Central Banks, they like to use terms such as Quantitative Easing (creation of new bank reserves that didn't before exist) and open market operations (buying assets with money that didn't before exist).
It's certainly increasing the maximum potential supply in ways divorced from any market mechanism. They are central planners and they're failing hard like central planners did before.
The panopticon you refer to is called "human society", by the way. You cannot participate in one and maintain unlimited freedom. If you are an evil jerk who kidnaps my child or steals life savings from my mom I want to be sure your assets can be seized. If you want to build anarchy, go ahead somewhere else but I think you'll find yourself tired of it rather quickly (and likely get eaten by ruthless command economies).
I want to live in this wonderland too, where are you?
Hence Bitcoin.
If you live in a democratic country, you actually have ways of fixing it. And no, you don't need to give up your freedom for blockchain panopticon in the process.
You still haven't told me in what fantasy land you live where that is actually possible.
I know that's cynical, but welcome to reality.
I have long been disillusioned by the fact that people can have an impact on their society by simply electing someone that will totally be fixing the issues that have been plaguing society for decades, for real this time, pinky swear.
But hey, again, if you live somewhere that actually happens let me know and I'll board the next rocket.
If there is no one suitable to vote for, maybe you can be that guy. And on flip side, if you think no one will vote for you, maybe your opinion is not aligned with the majority in your country.
Damned if you do and damned if you don't.
The existing, centralized electronic payment systems are a disaster for financial privacy, and it'll only get worse with CBDCs.
If you try to make something private, then you're helping money launderers, criminals and pedophiles.
Therefore, the message from the incumbents:
Shut up and embrace the unfolding panopticon, otherwise you're a bad person.
Also, we reserve the right to dictate what you spend your money on and if you want to donate to causes (e.g. Wikileaks or truckers) that we don't approve of, we'll block your bank account and cut you off from the system.
Lastly, we reserve the right to manipulate the money supply. It's enough for you to know that we are experts and have your best interests in mind. You don't need to concern yourself with how much money there is, how its supply is managed or the potential negative effects of our manipulation, you wouldn't understand the implications anyway.