industry regulations really
defeat most of the benefits
and points of the
decentralization
1: Hold something that is expected to stay scarce and not printed or mined to infinity
2: Make international, fast and cheap payments that are instantly finalized.
Disclosure of ownership in crypto really should be around a dollar threshold, not percentage and that mostly defeats the purpose of anonymity. I think financial institutions (banks, exchanges, wall st.) should have to disclose holdings in crypto for both crypto trader awareness but also for their customers in other business sectors awareness.
There should also be strict rules preventing operating an exchange/market maker and any sort of investment firm (hedge fund, etc.) by any degrees of separation. That means they can have no relationships at all organizationally (parent/grandparent company owns both type of thing). Any transactions between exchanges and funds of that sort should 100% be reported and tracked. I think it can be anonymously tracked for some period of time but must be disclosed to an independent regulating organization.
https://bitcoinist.com/cftc-chair-only-bitcoin-is-a-commodit...
https://decrypt.co/103926/sec-chair-gensler-bitcoin-not-secu...
on SoFi for example the UI/UX for trading stocks and ETFs is the same flow for trading crypto and people trade it like it is one. Else, why hodl at all if it's not in hopes it'll go up in value?
2: How does the receiving person use the received bitcoins, unless there is a real economy or again a centralized exchange?
Generally, it's literally the whole basic premise of everything 'crypto'!
Like, yes, when I take my kids to Chuck E. Cheese I do want to convert my money into the tokens. I do not want to store them as that.
> The problem in reality would be non existent if people used crypto currencies for what they were meant to be used for
Which is more or less what you're pointing at.
> We have proposed a system for electronic transactions without relying on trust.
Any regulation introduces a 3rd party which Bitcoin was designed to remove.
You cannot outsource the trust to code. Code is not law. You cannot solve all problems with code.
In other words, "if people would stop exercising their free will and acting in ways that may benefit them, but are detrimental to my idea/this system/society/etc, everything would be fine!"
As the admin and main developer of a small browser-based game, this is a hard lesson I've had to learn over the past several years: We don't get to define how people act and think. When we build systems, we must take into account how people will actually try to use them...and if we find that they're using them in ways that are detrimental to the structure as a whole, we need to rethink our systems.
What governments want is digital currencies, all the privacy concerns and none of the benefits of cryptos.
But, let's see if crypto can survive this pressure. Really it must be robust to this if it has any purpose.
Most of us no longer us bank notes, yet the amount in circulation climbs...[0] what's going on?
It actually probably acts like a buffer, with BOE spending the net on government assets while the notes vanish off to places we prefer not to think of
The plots you shared are meaningless if they are not normalized against the total money supply. I think if normalized by total amount of money in circulation the percentage would be shrinking and not growing.
You know, I think we can help you with that: crypto exchanges should be banned on sight. Including localbitcoins.
Let the libertarians have their playground, but there must be no linkages between it and the regular world of money.
Who could have seen that coming? /s
crypto is many things, but the single most important is demonstrating cryptography as a foundation for robust digital rights. we can guarantee digital rights in a way that require complex and frequently corrupt institutional enforcement in the real world. this is a mind-bending achievement and we're only at the very outset
But I think more crucially is that what's increasingly looking like "the only good use of crypto" is really a consequence of social issues a similar way to how cars are very popular in countries with poor infrastructure (e.g. USA). If the country gets its act together, this aspect of crypto's value add vanishes and will just be seen as a slow and poor quality volatile payment system.
"If the country gets its act together".. you know by fair elections, good governance and you know by similar such 'non-crypto' things.
Or maybe you are just ignorant? Here are some examples I have compiled (took me <5 min): https://news.ycombinator.com/item?id=32406095
You say - "If the country gets its act together...". I think crypto will get its act together and get around the adoption blockers before despot regimes of the world get their act together. Just a gut feeling based on our history so far. I also agree that there will be multiple crypto scams along the way. Such is the allure of the new tech.
[1] https://blog.chainalysis.com/reports/2022-global-crypto-adop...
[2] https://www.bloomberg.com/news/articles/2022-11-27/nigeria-s...
No wealthy person in this planet got wealthier by hoarding pieces of paper with pictures of national heroes, but by investing it in gold, art, land, real estate, stock markets and many others.
If you and some other people agree that specific hashes on a specific blockchain have some value for you and avoid "debasing your savings" you're free to hoard them.
The wealthy might be hoarding Lamborghini's but we can always build more cars. Can't do that with money unless the government or a commercial bank does it.
Mere issuance isn't enough to guarantee price stability.
(There's an interesting question to be asked about whether the US should allow the usage of its digital dollars by non-US persons as a means of evading the currency controls of South American governments, effectively exporting price stability. Much as the existing Eurodollar system. But I don't think this is the place for that discussion)
Srilankan rupee lost 50% value overnight in March 2022 and is subject to futher deterioration due to the corrupt incompetent government. Same with Venezuela. Bitcoin or Gold or USD/EUR are the only good options for the millions of citizens of those countries, albeit generally available on black markets because of government controls. My colleague has his family in such a country. Guess what is the easiest way for him to help his family in need? [Hint: gold is hard to transfer and USD/EUR transfers are sanctioned because of US/EU govt policies].
Clearly someone who lives in some small insular corner of the world with good governance and stable currencies would definitely imagine all the benefits of crypto. /s
Some real life examples of problems crypto has solved (compiled just for comments like yours which seem to be lacking empathy or imagination or both): https://news.ycombinator.com/item?id=32406095
Are industry regulations preventing self custody?
I hope, and believe we're talking about regulation being rightly applied to centralised exchanges. So they don't front run customers on token listings (Coinbase), use customer funds when customer's haven't allowed them to (FTX), replace their customer's coins with a different currency (Binance), or whatever else.
The problem in reality would be non existent if people used crypto currencies for what they were meant to be used for: an alternative economy with no need for exchanges and third parties: you sell me a banana, I give you some satoshis.
Not saying this is convenient IRL, requiring to sync to a network and chain is expensive and difficult from a phone, but that was the supposed use case.
I'm more and more convinced that blockchain industry solves no real world problems at all, except in the crypto sphere itself (like smart contracts do have a use...for crypto exchanges, crypto games and crypto gambling) and that 99% of the people who get involved couldn't care less about crypto use cases, only if they will sell for more $ than they bought for.