The unfulfilled hopes for crypto parallel the disappointment I have felt with the internet overall. Who would have imagined that it would become the ultimate tool for government surveillance of the population and for corporate domination of discourse? Cryptocurrency may now become the gateway to UBI and allow governments to have unprecedented granular control of the distribution of resources.
True, but thankfully there are tools available to avoid such surveillance (admittedly I'm not well versed in them) like VPNs. Also... thank god for the WayBack Machine lol
And I think the same will be true for crypto in the future. If we don't turn the tides of where governments are headed, I can see it being used for off-the-grid transactions as I'm sure criminals are using it now.
This is another thing the crypto community needs to be more honest about: Yes, criminals use it, because it's an anti-State tool. I'm not sure there's a way to engineer a currency such that true crime (human trafficking, murder, etc.) could be forbidden without subjecting the currency to a centralized arbiter like we have now.
Crypto is best as a prepping tool, but it has failed to solve any real problems in the current economic system. When a crisis hits, it can be useful, but it doesn't revolutionize the whole economic system to make it truly better.
One reason is because the crypto folks are focusing only on the money-side of a transaction. Now you can send valuable tokens to other people, peer-to-peer, without third parties. But what about the other side of the transaction? If you want to buy and sell good and services, there must be a way to deal with that side, too.
This is why the cryptoscene is full of scammers. They can be sure that when the transaction is made, they will receive their money. But it's very easy to not keep their promises of goods and services or other form of value to the other party. They can just take the money and run. Nobody will help the victim.
Crypto economy is like a third-world country. You cannot really trust anyone, so you have to be very careful who you deal with. And even then you can lose a lot of money. That's why we are not seeing any productive business coming out from crypto. It's all just gambling. People are hoping to get rich by acquiring tokens which will go up in price. Nobody is producing new goods and services which would make the whole society wealthier.
This is where advanced "smart contracts" could actually be really cool. Using machine learning or some algorithm that could verify objectively whether a service or good has indeed been provided.
I'm not super knowledgable in this area, but from talking to those who are, I've heard the tech is nowhere near this level yet.
Unfortunately, smart contracts are not helpful, either.
First we have to ask: What is a contract? It's an agreement between two or more parties. For example, we might agree to do a transaction where I will give you an apple and you give me a dollar.
But if we look at these "smart contracts", they don't really know anything about our agreement. They are just computer code which is executed automatically.
If there is a bug (intentional or accidental), the smart contract might end up sending the apple to China and donating the dollar to Anthony Fauci. And we would be baffled: "What the hell just happened? This wasn't what we agreed on!"
From the perspective of the smart contract, everything was executed perfectly. It did what it's own code said it should do.
This is why smart contracts are neither contracts or smart. They are not contracts because they don't care what the people agreed on. And they are dumb because they only do what they were programmed to do, there is no intelligence in execution.
But the concept can be still very useful, if we consider them as tools to execute a real contract. First, there must be a real contract. In that contract, we can agree to use computer code to execute automatically all or some parts of the contract. But if something goes wrong, we can always to back to the real contract and fix unintended consequences of faulty automation in order to fulfill the agreement.
The banks seem to be lining up behind XRP. There's also all sorts of talk of Central Bank Digital coins. The cost of transaction for Bitcoin is not in the $1 or so it might cost for the transaction but in the time that it takes to process. And its volatility means that you can lose or win if you offer to buy or sell in the time it takes to process the sale/buy (normally into fiat).
That reference to bail outs, maybe it's not so 'libertarian' and more CBDC.
A major problem with this is the uman animal itself. The abstract/theoretical concept might be awesome but when it starts to be used... bye bye awesomeness!
The simple fact that we are using fiat money and the monetary system machinery to buy/sell BTC says it all... another failed project.
These are fair criticisms. Sorry for the accidental ban (I glanced at this while in the car and saw "crypto futures trading" and thought it was a spam account, my mistake).
I think our disagreement comes from the fact that I believe crypto's actual utility is derived from the fact that it can subvert regulatory oversight, taxes included. Peer-to-peer means no third party. Now, it would be absurd to think the government (or today's popular opinion) would be OK with tax avoidance. Still, in my view giving the government the tools to surveil crypto activity defeats its entire purpose.
I disagree with the idea that crypto is a "store of value". I believe its volatility is inherent to its lack of utility which would give it a stable demand. Additionally, there are many substitutions and potentially more to come in the future. Myrmikan Capital has a great piece on this:
Gold has a definitive number of substitutes and has base demand from industry and jewellery. These things will keep its price more stable. Therefore, I can use it as a store of value even though the government would have qualms if I were to try to transact with it tax-free.
Crypto, however, is FAR superior than gold when it comes to ease of transaction, uniformity, ability to verify legitimacy, and maneuverability (across borders) making it the superior anti-State tool. So naturally, as one's nation becomes more authoritarian (as I fear is happening in much of the West) the ACTUAL utility of crypto increases, and the urgency reduces the concern for volatility.
The unfulfilled hopes for crypto parallel the disappointment I have felt with the internet overall. Who would have imagined that it would become the ultimate tool for government surveillance of the population and for corporate domination of discourse? Cryptocurrency may now become the gateway to UBI and allow governments to have unprecedented granular control of the distribution of resources.
True, but thankfully there are tools available to avoid such surveillance (admittedly I'm not well versed in them) like VPNs. Also... thank god for the WayBack Machine lol
And I think the same will be true for crypto in the future. If we don't turn the tides of where governments are headed, I can see it being used for off-the-grid transactions as I'm sure criminals are using it now.
This is another thing the crypto community needs to be more honest about: Yes, criminals use it, because it's an anti-State tool. I'm not sure there's a way to engineer a currency such that true crime (human trafficking, murder, etc.) could be forbidden without subjecting the currency to a centralized arbiter like we have now.
Crypto is best as a prepping tool, but it has failed to solve any real problems in the current economic system. When a crisis hits, it can be useful, but it doesn't revolutionize the whole economic system to make it truly better.
One reason is because the crypto folks are focusing only on the money-side of a transaction. Now you can send valuable tokens to other people, peer-to-peer, without third parties. But what about the other side of the transaction? If you want to buy and sell good and services, there must be a way to deal with that side, too.
This is why the cryptoscene is full of scammers. They can be sure that when the transaction is made, they will receive their money. But it's very easy to not keep their promises of goods and services or other form of value to the other party. They can just take the money and run. Nobody will help the victim.
Crypto economy is like a third-world country. You cannot really trust anyone, so you have to be very careful who you deal with. And even then you can lose a lot of money. That's why we are not seeing any productive business coming out from crypto. It's all just gambling. People are hoping to get rich by acquiring tokens which will go up in price. Nobody is producing new goods and services which would make the whole society wealthier.
This is where advanced "smart contracts" could actually be really cool. Using machine learning or some algorithm that could verify objectively whether a service or good has indeed been provided.
I'm not super knowledgable in this area, but from talking to those who are, I've heard the tech is nowhere near this level yet.
Unfortunately, smart contracts are not helpful, either.
First we have to ask: What is a contract? It's an agreement between two or more parties. For example, we might agree to do a transaction where I will give you an apple and you give me a dollar.
But if we look at these "smart contracts", they don't really know anything about our agreement. They are just computer code which is executed automatically.
If there is a bug (intentional or accidental), the smart contract might end up sending the apple to China and donating the dollar to Anthony Fauci. And we would be baffled: "What the hell just happened? This wasn't what we agreed on!"
From the perspective of the smart contract, everything was executed perfectly. It did what it's own code said it should do.
This is why smart contracts are neither contracts or smart. They are not contracts because they don't care what the people agreed on. And they are dumb because they only do what they were programmed to do, there is no intelligence in execution.
But the concept can be still very useful, if we consider them as tools to execute a real contract. First, there must be a real contract. In that contract, we can agree to use computer code to execute automatically all or some parts of the contract. But if something goes wrong, we can always to back to the real contract and fix unintended consequences of faulty automation in order to fulfill the agreement.
I plan to barter. Starting with chickens lol
BISQ https://bisq.network/
Catherine Austin Fitts says that BTC etc nowadays basically serves as a prototype for Central Bank Digital Currency, a rather sobering thought.
I think Central Banks will certainly hijack the crypto narrative to make the transition more palatable, so in that sense it was a prototype.
However, I doubt any CBs will implement their currency via blockchain.
The NZ Reserve Bank is planning to.
https://www.rbnz.govt.nz/notes-and-coins/future-of-money/cbdc
Or
https://www.rbnz.govt.nz/-/media/ReserveBank/Files/Publications/Bulletins/2018/2018may81-05.pdf
The banks seem to be lining up behind XRP. There's also all sorts of talk of Central Bank Digital coins. The cost of transaction for Bitcoin is not in the $1 or so it might cost for the transaction but in the time that it takes to process. And its volatility means that you can lose or win if you offer to buy or sell in the time it takes to process the sale/buy (normally into fiat).
That reference to bail outs, maybe it's not so 'libertarian' and more CBDC.
How easy is for the gov. to buy the very crypto gods, to start cracking down crypto?
A major problem with this is the uman animal itself. The abstract/theoretical concept might be awesome but when it starts to be used... bye bye awesomeness!
The simple fact that we are using fiat money and the monetary system machinery to buy/sell BTC says it all... another failed project.
These are fair criticisms. Sorry for the accidental ban (I glanced at this while in the car and saw "crypto futures trading" and thought it was a spam account, my mistake).
I think our disagreement comes from the fact that I believe crypto's actual utility is derived from the fact that it can subvert regulatory oversight, taxes included. Peer-to-peer means no third party. Now, it would be absurd to think the government (or today's popular opinion) would be OK with tax avoidance. Still, in my view giving the government the tools to surveil crypto activity defeats its entire purpose.
I disagree with the idea that crypto is a "store of value". I believe its volatility is inherent to its lack of utility which would give it a stable demand. Additionally, there are many substitutions and potentially more to come in the future. Myrmikan Capital has a great piece on this:
https://www.myrmikan.com/pub/Myrmikan_Research_2017_10_26.pdf
Gold has a definitive number of substitutes and has base demand from industry and jewellery. These things will keep its price more stable. Therefore, I can use it as a store of value even though the government would have qualms if I were to try to transact with it tax-free.
Crypto, however, is FAR superior than gold when it comes to ease of transaction, uniformity, ability to verify legitimacy, and maneuverability (across borders) making it the superior anti-State tool. So naturally, as one's nation becomes more authoritarian (as I fear is happening in much of the West) the ACTUAL utility of crypto increases, and the urgency reduces the concern for volatility.
Why was Eric banned for this comment?