It’s gambling. It should be regulated and taxed like gambling. It shouldn’t be banned, and academic exploration should be unfettered. But anyone making money off it should be monitored by the public and the law, and pay for that oversight.
This is a downside. But I don’t think it’s a crippling one. Tax and regulate the people proximate to it, and the system should net out.
There's a drive to pioneer, seek thrills, find adventure, take risk, and compete. If a culture has healthy outlets for that drive, then it can lead to incredible innovation, discovery, and harnessing new resources. How many new islands, foods, tools, drugs, etc. were found by someone who just said "fuck it" and went for it?
But when that drive has no healthy outlet, what you instead see is risk-taking turned to destructive ends. We've mapped the whole Earth, space is too expensive, most of the dangerous blue collar jobs have (rightly!) been made safer or automated, and the US's past several decades of forever wars have clearly become less and less morally justified.
So what we see is many young men striving to satisfy that desire any way they can. Things like:
* Treating crypto as a new unexplored frontier where they might get rich.
* Likewise now generative AI.
* Escaping into gaming where they can at least experience a simulation of the kind of risk, thrill-seeking, and glory they crave. Then GamerGate happened where some men lashed out at women who they felt were threatening that space where they could virtually experience that side of themselves.
* Young Trump voters who voted for him specifically as destructive wildcard to break down institutions. Because a world that is more chaotic and dangerous is a world better suited to their desires.
* Further, the fascination and trend around doomsday preppers, apocalyptic media, militias, etc. A segment of the population are obsessed with the world falling apart because maybe in the resulting chaos they can (re)build something.
This is a generalization, obviously, but I tend to think of young single men like this as the TNT of society: incredibly powerful and useful when applied well, but destructive otherwise.
> ...
> This is a generalization, obviously, but I tend to think of young single men like this as the TNT of society: incredibly powerful and useful when applied well, but destructive otherwise.
---
(Bare branches refers to branches of the family tree where there's an unmarried male in a society where the male/female ratio is significantly distorted - https://en.wikipedia.org/wiki/Guang_Gun )
https://www.wilsoncenter.org/sites/default/files/media/docum...
> Missing Women and Bare Branches: Gender Balance and Conflict
> We must also examine the reaction of the government. Historically, we have found that as governments become aware of the negative consequences of a growing number of bare branches, most governments are motivated to do something. In the past, “doing something” meant thinning the numbers of bare branches, whether through fighting, sponsoring the construction of large public works necessitating dangerous manual labor, exporting them to less populated areas, or co-opting them into the military or police. One 16th century Portuguese monarch sent his army, composed primarily of noble and non-noble bare branches, on one of the later crusades to avoid a crisis of governance; more than 25 percent of that army never returned, and many others were seriously wounded (Boone, 1983, 1986).
> We find that the need to control the rising instability created by the increasing numbers of bare branches has led governments to favor more authoritarian approaches to internal governance and less benign international presences. In many ways, a society’s prospects for democracy and peace are diminished in step with the devaluation of daughters.
I would amend this to say "Because they believe a world..."
You kind of hit on it with your statements about doomsday preppers.
All of which I find hilarious. Apocalypse proponents, doomsday preppers, accelerationists, anarcho-anything, etc.
People are trying to prepare for an event that by its very definition is unimaginably catastrophic. We don't even know what that event will be. Or if survival is possible or even desirable.
People think that because they want a thing, that they're in a better position to exploit that thing. Sorry, Littlefingers, chaos is not a ladder. It's just chaos.
I'm not sure what fraction of HN is between 15 and 35 years old, but it's probably pretty high. Lots of people want to get a career in the new and exciting thing.
(I jest, but I do think there's some truth at the core here)
I just find it so funny, almost like someone did a s/crypto/ai in the uberelite techie hivemind.
In recent years I have worked quite hard to rid myself of such thinking, in favor of a more positive outlook, even if it's slightly forced.
As a result, I've found myself much more at peace with the world, and generally in a better mood. I'd like to think I'm a better version of myself sans cynicism but maintain a healthy dose of skepticism. I'm not sure I bought in at first, but I've slowly come to realize the benefit of actively acknowledging goodness. +1 for "fake it til ya make it."
That said, there's certainly a significant part of my psyche with which the sentiment of the law resonates.
Media surfaces to the top any subject which draws attention.
I'm not surprised, I am just disappointed. Perhaps it's ego, but I expect better out of hn participants.
Your payment pipelines become less valuable when nobody wants those Liras, Bolivars, Argentine Pesos, etc. transmitted over them.
And if you don't think that the US dollar is at risk of debasing itself, you should qualify why.
It is equally ridiculous that crypto people think that having a fixed supply of something makes it valuable. Oceanfront property in Miami is also limited, but crypto people are not pumping that because they are not invested in Miami oceanfront property.
Having a fixed supply doesn't make something intrinsically valuable. But restricting the supply absolutely does increase price when demand exists.
"Sophisticated investors" never had access to an asset whose supply was predictable (resistant to debasement), but also decentralized and permissionless to participate in. "Sophisticated investors" should probably know their monetary history, including why gold evolved as a world standard until Bretton Woods. And the types of money societies used before that.
> It is equally ridiculous that crypto people think that having a fixed supply of something makes it valuable. Oceanfront property in Miami is also limited, but crypto people are not pumping that because they are not invested in Miami oceanfront property.
Not sure what you mean, the lead up to 2008 was a pretty interesting time for real estate developers, why would crypto people be talking about condos?
Maybe you thing they are wrong for wanting that, because maybe you think the government is a threat to their wealth, and that is fine to have that opinion but the market for "decentralized and permissionless" isn't very big, which is why you don't see much money going into crypto anymore.
Being decentralized means no single party controls it, and thusly no single party can debase it or prevent its distribution. You need to understand why gold is still used as a store of value, and the role of government bonds as safe havens in the modern economy.
You have trust in a system because it works (for you) now, but you're not looking far enough into the future, and you're not weighting risk appropriately.
Crypto isn't just about sending money or making money. This is a completely new "thing", and part of the way its used is redefining what money actually is, based on programmatic protocols, consensus algorithms, etc.
I suggest you have a look at how many people are allowed to merge bitcoins PRs in github
And then your network will compete with all the other open networks and protocols. And may the better ones win.
Why do governments hoard billions of dollars of gold bars in military protected bunkers?
Does it have something to do with store of value, and difficulty in debasing gold?
What I think you're missing the understanding of what money is, and the history of money. This is why gold gets brought up.
In the last some thousand years gold evolved as a world standard for trade. Why? It had some good properties; physically tough and lasting, common enough for people to find / rare enough to be difficult to debase (holds value), you can melt it and shape it (divisible), etc. Gold permeated all societies because it was the "winner" of precious metal monies, and good technology tends to spread, giving it network effects.
Your US dollars were originally just paper notes promising redemption for gold at your bank. We traded those notes around because we had enough trust in a system now for it to be convenient for us.
At some point, governments decided it wanted to they wanted more control over money/economy, and essentially forced a fiat standard on the population. This is the great monetary experiment we are living now.
https://en.wikipedia.org/wiki/Executive_Order_6102 https://en.wikipedia.org/wiki/Bretton_Woods_system
If you can contextualize what money is, the history of money dating back thousands of years, then you can start to see how crypto has a lot of advantages over metal money, as well as fiat money.
Again I'm still not sure why you are trying to convince me that USD is a bad investment. I already said it was at the beginning of this thread.
Deflation can send an economy into a death spiral.
I needed to quickly send some money internationally for a perfectly legal purpose. I have an old Coinbase account I wanted to use for the purpose that I hadn't left any money in (because crypto is not a good investment vehicle). Thanks to changes in KYC laws, I found myself completely unable to do this. I had to give them a very uncomfortable amount of information just to unlock the account (including a scan of my driver's license and my social security number). At this point, they still wouldn't let me deposit any cash without further verification. They then proceeded to refuse to let me verify every payment method I tried using (including debit card, PayPal, checking account... they were "unable to verify" any of them). There was some third party service they wanted to use that would literally log into my bank account to provide verification (??!!), but I drew the line there.
So I just ... gave up. Forget any of the more interesting uses of crypto. We're not even talking gray market goods here (it would be interesting for people who need cheap insulin to be able to order it from international pharmacies in countries with lax laws, for example). We're talking boring ordinary transfers, effectively made impossible by regulation.
And yes, there are a lot of scams in crypto. It's not very economically or environmentally efficient (usually). Maybe it deserves to be regulated out of existence. But I do know that for a while it was able to do some things that were difficult or annoying to do in other ways.
"I've made the perfect platform for criminals, but for some reason there are a lot of people using it for crimes and now law enforcement is shutting me down! This is an outrage!"
This reminds me of why there are so few ways to simply send someone a large file on the Internet. All of the easy ways make it too easy to spread copyrighted worked, so they all need to suck in one way or another to avoid being shut down.
The defenses people give of file transfers, chat encryption, etc etc are pretty straightforward: certain things should be equally usable by both law-abiders and criminals, for both legitimate and illegitimate ends. That kind of broad protection is the only way to insure that the civil liberties of all users are protected. Some of the illegal things that people do with these tools are unfortunate, but protecting them remains worthwhile.
What I'm saying is that the people who invented cryptocurrency believed basically the same thing about finances - that we would be better off treating the ability to transfer money as an absolute right, kind of like Signal treats encrypted messaging as an absolute right. The fact that the government doesn't see this as "legitimate" is kind of the point. (It was illegal to export many forms of encryption for *years.) As someone who at some points has used cryptocurrency for completely legal money transfers, I've directly benefited from the ease of use and simplicity this entailed.
Is it "naive at best" to hope that Signal will indefinitely maintain the property of protecting my chats against intrusion by third parties? Maybe! But that doesn't change the point that the fact that Signal does this is the whole reason I use Signal!
In fact e-gold did all that 20 years ago with a simple centralized ledger.
To my dismay, I found that wise doesn't do Swift transactions in USD to bank accounts in the USA. I actually thought that was the whole idea behind wise, but apparently not?
The other option was to pay my bank an additional 40€+ fee for each Swift transaction, which is too much if you need to wire money every month to the states. USDC was the cheapest option in the end (Coinbase doesn't charge for SEPA -> Coinbase and the EUR/USDC exchange rate is closely tracking EUR/USD).
I would agree that >99% of the tokens and cryptocurrencies are garbage. But I would be sad to see Bitcoin and Monero dying.
Honest question are you legitimately excited for FedNow? What problem will it solve?
What does FedNow have to do with cryptos downfall? Does FedNow fix our 120% debt to gdp ratio? Estimates of inflation required to get our debt to gdp back to 50% is 4-5 years of 12-20% inflation.
You don't want inflation? Well then I guess the US is going to default on our loans. 98% of countries in the last 120 years that had a debt to gdp of 130% has either defaulted or had massive inflation (only exception is Japan which is still in progress, currently holding off because its positive NIIP, US has negative NIIP).
For the US it's either default, print, or hope for a miracle.
Sounds impressive, but this stat relies heavily on a) developed world nations and b) nations back when we had the gold standard. The US also benefits dramatically from being able to issue debt in USD, which it controls.
The US can issue debt in USD and even print 1 trillion USD coins. But what happens to the value of the currency when they repeatedly do that?
Crypto (and other assets obviously) can act as a hedge against such bad government behavior.
Thus far, not all that much of consequence.
> Crypto (and other assets obviously) can act as a hedge against such bad government behavior.
Objection, Your Honor. Assumes facts not in evidence.
From Jan 2019 to now we've had 17.4% inflation. Your purchasing power of the money in your bank account has been reduced. How have other assets faired in that time?
> Objection, Your Honor. Assumes facts not in evidence.
Okay longer timeline, if you held dollars in your savings account from Jan 2009 to now (during ZIRP) you've lost 30.5% of your purchasing power. How has the SP500 or houses fared in that time (even ignoring crypto)?
If losing 30% of your purchasing power is no consequence to you, please let me have a not much of consequence portion of your salary, thanks.
... I would be a doofus. That's where my emergency fund goes, but that's it.
> From Jan 2019 to now we've had 17.4% inflation. Your purchasing power of the money in your bank account has been reduced. How have other assets faired in that time?
My home value has tripled, and the S&P500 has gone dramatically up. Series I savings bonds are also a useful option if I'm really all that worried about the stuff in savings, as their interest rate is pegged to inflation numbers.
If we're going to carefully pick dates to make our arguments ("Jan 2019 to now" having had some... outlier stuff going on, after all) I'm gonna ask how hedging with crypto starting in April or October of 2021 would've gone. Remind me the purchasing power of a $64k Bitcoin today?
I'm happy you have a home and own some SP500 to offset USD destruction. Not everyone is so fortunate to have access to those markets. I would suggest you look into crypto as part of your hedge against bad USG behavior because it has some nice properties that could uncorrelate it with those assets if things get nasty (90% tax rates, etc).
One, obviously a policy failure. Two, don’t do this. Bank deposit dollars are optimised for transacting, not long-term value transport. For that, use Treasuries (including inflation-protected ones). It’s not the Falcon 9’s fault that it makes for a bad hammer.
My argument is that assets and crypto is needed to hedge the potential incoming USD destruction. And that because crypto has some nice properties that houses and the SP500 don't, it has a legitimate reason to be a part (even if small) of your hedge.
I don't buy the "Crypto is a complete scam" argument at all.
No depositors lost money. And like, yeah, Treasuries go up and down in price; it's dumb our regulations pretended otherwise. Particularly given the problem was fixed by Basel III.
> assets and crypto is needed to hedge the potential incoming USD destruction
This is gold buggery. Which means gold does a fine enough job.
> don't buy the "Crypto is a complete scam" argument at all
I don't, at least not with certainty. But there is certainty around the prevalence of fraud. That needs to be regulated, which means crypto needs to be taxed to pay for that regulation. Gold bugs are a famously-profitable client group for finance; crypto is the same. Let's put them on the same level.
> This is gold buggery. Which means gold does a fine enough job.
It's really expensive to secure my own gold. I can't easily verify my own gold. I can't easily send my goal in under a minute to help my friends in Venezuela who's government has inflated his money supply by 5,000% and confiscate most of what sent physically or through the banking system. The USG also has a precedent for confiscating everyones gold. I can't take gold with me across a border in an undetectable manner. Sorry but gold is not doing a fine enough job for me and I'd like something a little more advanced and modern.
I understand for us privileged westerners (assumption about you on my part) that this all this seems a little silly, but for my family and friends in situations where their government is behaving really badly, this is serious. And "buy T bills or a house or the sp500" are not the solutions you think they are.
And I hope it doesn't come to the US but it seems a little silly if you are rich enough to not hedge against that possibility, especially given the US financial competency these last two decades.
Gold bugs pay for their own security. Crypto outsources investigation, enforcement and regulation onto the public.
> how is crypto packets flowing preventing you
My taxes pay for investigation and enforcement.
> Don't you wish you could see JP Morgans or the Pentagons books laid bare like the blockchain?
No? J.P. Morgan is audited. Almost nobody dives into their various filings with the SEC, FDIC, Fed, and every state banking and securities regulator. As for the Pentagon, absolutely not–that's a huge national security hole.
> for us privileged westerners (assumption about you on my part) that this all this seems a little silly, but for my family and friends in situations where their government is behaving really badly, this is serious
I don't think it's silly. I just don't think it should be subsidized by us.
> it doesn't come to the US but it seems a little silly if you are rich enough to not hedge against that possibility
It's a common pass-time for the rich. Crypto, like gold buggery, is aimed at soothing an emotional need to hedge. The fact that those with most to lose play by a different playbook should speak for itself.
When I buy a big vault, extra door locks, a pitbull, and a gun to protect the gold I store at home to go full gold buggery, am I paying for the investigation, enforcement, and regulation of gold? This is what I mean by its expensive to secure my own gold.
When I store gold at a business that specializes in such services, am I paying for the investigation, enforcement, and regulation of gold?
If yes for either of these, how am I not paying for that same investigation, enforcement, and regulation of crypto when buying a vault for my crypto or paying one of many such companies to hold it for me?
I don't really get what you are subsidizing that you don't also subsidize for pokemon cards, private equity, or any collectable.
Gold is exempt from sales tax in most US states so I really have no clue what you are on about.
Incase I've missed something, on behalf of all crypto users you have my full permission to stop subsidizing all USG employees trying to investigate, enforce, and regulate crypto.
No, you’re paying to secure it. That minimises the fraud around gold.
> When I store gold at a business that specializes in such services, am I paying for the investigation, enforcement, and regulation of gold?
Id.
> don't really get what you are subsidizing that you don't also subsidize for pokemon cards, private equity, or any collectable
Private equity is subject to some reporting standards under the ‘40 Act because it is a haven for fraudsters. Pokémon cards are not similarly problematic so they’re not. Crypto, like securities and gambling, has proven itself a haven for fraud.
I don’t demonise crypto. But we need visibility, laws and enforcement, as well as a stream of revenue to pay for it.
They are just regurgitating tweets from someone else
Something autonomous, expensive, rugged? Talk to the Army. Something that allows no recourse? Probably people outside of the court system.
Crypto makes sense for people who are doing something the government doesn't like, but that isn’t something three-letter agencies are willing to spend billions to fix. So not support terrorism, but possibly extracting currency from a controlled regime. It’s not useless, but it’s not big money, as far as I can tell.
I have friends who got in trouble with their government (the spicy kind of ecologists). They have an interesting project around Crypto: communication to evade surveillance. I’m not sure there are many others legitimate uses. But it’s not zero.
Craigslist--when you go to like, sell your old TV--actively tells people not to accept online payments from people because they can be reversed. Why? Because the risk to someone who has a single TV to sell is very different from the risk to someone selling hundreds of TVs, and so the person you need to protect is the seller, not the buyer.
Also, you can totally build a system on top of crypto platforms that supports reversing transactions: it is, at the end of the day, fully programmable money. It's main claim to fame is that it is decentralized and transparent in implementation, and I'd have thought those would be universally good things, right?
But like, frankly, your position here just sounds like some naive form of how we should refuse to give anyone autonomy (which almost all of these systems provide) or privacy (which the better systems provide) because good people have nothing to hide :(.
Everyone deserves end-to-end encrypted permissionless communication, and the same everyone deserves zero-knowledge protocol permissionless payments.
We have controls on regimes normally because the two are highly correlated.
Crypto lies in stark contrast as a shared and open source protocol across the globe, that is not as easily centrally owned. Whether that is worth the pains of self custody, throughput and volatility is going to depend on who you ask.
You don't have to use a regular bank either you know, cash is way less traceable than Bitcoin.
There are hundreds of wallets, some of them OSS, some of them closed source, some of them homebrew. I have used several different wallets, including some that I have coded myself from lower level cryptographic APIs. This is the beauty of it: users are not limited to MetaMask, just like users are not limited to browsing the web in Chrome - despite it obviously having major market share.
And cash is a poor substitute.
Waving flags for payment systems that enable fascist wannabe dictators to cling on to power - well done.
"FedNow is coming in a months time so it should hasten crypto’s inevitable downfall faster."
You arent even trying to be original here. Wonder which twitter account you stole that from
There is no need to kid ourselves here anymore to even entertain crypto.
Crypto is a complete scam, with no legitimate or legal use case and nothing else to offer anybody.
I only wish crypto died sooner and that nobody uses it.
We have other systems that are more robust than crypto that is used in the order of hundreds of millions such as UPI, PIX, Wise, Mpesa, Sendwave, etc that has time and time again proved to be better than crypto.
FedNow is coming in a months time so it should hasten crypto’s inevitable downfall faster.