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Comment by fullshark | Hacker News Reader

This is nonsense. This is being driven by speculation / minuscule interest rates / greed. Very little of the demand for btc in the past year is due to lack of faith in institutions.

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You might be right, but in Zimbabwe it actually was driving the price like this. There it already reached 10K at the end of October. Why? Hyperinflation of the local currency.

http://edition.cnn.com/2017/10/31/africa/zimbabwe-bitcoin-su...

I think you're dead on right in what is driving it, but I get the feeling you are suggesting those are poor reasons for the drive. I tend to think they are good reasons. I also don't think greed is always negative, though it certainly can be. However much of the activity in the free market that benefits everyone is, at some level, based on greed.

Sure, that's how it started. But as the adoption increases and price skyrockets, more people will understand the value of the concept of decentralization.

Yes, this exactly. I've been trying to point this out as much as possible. The key to future success is adoption, and the precursor to adoption is awareness and interest.

If the value prop of Bitcoin is that it is a store of value comparable to gold (which is now what it is being sold as as far as I can tell), it doesn't need to skyrocket in price. It needs to hold value during a recession. How in the world is that going to happen when so many people holding it right now are speculators looking to make a buck? They will flee and the price will tank. How is that a store of value?

The truth is, nobody really knows what is driving the price up. It’s not the DNMs, the high price and fees are a PITA for them. Could be artificial pump via USDT. Could be individuals or even nations under financial sanctions dumping cash into the markets. Could be speculators in Western markets. Could be people in countries with unstable currencies looking to hedge their losses. We know all of these are factors - unless tethers are actually backed 1:1 by USD - but due to the decentralized and pseudonymous nature of the currency there is little way to know what the prevailing reasons are unless and until it all comes tumbling down. Gox blew up in 2013 and the full story only came to light (well, sort of) this year.

Or it could be all of the above and then some. For some reason we as humans like everything neat and tidy and be able to point our finger at one thing and say this is it. If there’s anything you can learn from the world and why it operates the way it does and how some events that would seem unthinkable eventually transpire, is that the world is much more complex than anyone gives it credit. This goes for economies, markets, bitcoin growth, wars, policies, lobbying and just about everything else. So yeah, I’d say it’s a number of reasons.

Let me try to make the case for why Bitcoin could be a useful beyond greed.

I can't really think of many reasons why you would use crypto to pay for a coffee or a sandwich if you live in the West (or frankly, even most developing nations).

On the other hand, I can definitely see the utility in a censorship-resistant digital medium to store wealth. To me, this latter use case has much, much more potential to serve the unbanked (as well as the banked).

Some use cases I can think off the top of my head:

(1) You are from Syria and need to flee war and escape into Europe – however bank transfers into Europe are almost impossible if you are a common Syrian. Bitcoin allows you to take your wealth with you, in your brain, as you escape across the border, by just memorising your twelve word private key.

(2) You are from Venezuela or Zimbabwe – The government has issued capital controls and is devaluing currency by the day. You transfer your wealth into Bitcoin in order to offset capital erosion due to hyper-inflation. When the situation stabilises, you transfer your Bitcoin back into fiat.

(3) You are Saudi billionaire Al-Waleed bin Talal. The government freezes all your assets in a political coup. If you have a portion of your wealth in Bitcoin, you could protect them from government expropriation and anonymously transfer them to associates or family members abroad.

(4) You are whistleblower Julian Assance and have been cut off from the financial system as a way to censor your speech. Bitcoin allows you to have an unbreakable digital "Swiss bank account" that the authorities are not able to reach.

This reminds me of Peter Thiel's recent words about Bitcoin [1]: "it's like a reserve form of money, it's like gold, and it's just a store of value. You don't need to use it to make payments."

Reference: [1] https://www.coindesk.com/peter-thiel-bitcoin-like-reserve-fo...

I've read this before ... oh wait, you keep posting these examples

Five times in the past day, to be exact!

Here's the other four...

https://news.ycombinator.com/item?id=15792805

https://news.ycombinator.com/item?id=15787235

https://news.ycombinator.com/item?id=15787155

https://news.ycombinator.com/item?id=15786568

"I can totally just casually think of certain use cases right off the top of my head here spontaneously, let me see here... [PASTE]"

Great. I'm none of those things so I'll keep my money out of it.

> I can't really think of many reasons why you would use crypto to pay for a coffee or a sandwich if you live in the West (or frankly, even most developing nations).

Until recently that was one of the main utilities of Bitcoin and the mainstream community changed the discourse to "reserve of value". BitPay, Coinbase, Xapo et al were created with the idea of transactions.

This is just one of many observations about how people arguments are not consistent.

I think many organizations behind Bitcoin are responsible for delaying relatively simple innovations to make Bitcoin useful for transactions.

There is absolutely nothing that would prevent a government outlawing and criminalizing bitcoin at any point in time. With one stroke of a pen government can outlaw owning bitcoins or performing any transactions in bitcoins. I'd say this is bound to happen eventually with certainty because no government would be willing to lose control on currency (especially ability to pull it out of thin air) and thereby the power they exert on economy as well as other nations. You can count on this. So all those scenarios you mentioned are meaningless because any capital you have in bitcoins is bound to evaporate overnight and reduced to zero at the whim of the government.

See: https://en.wikipedia.org/wiki/Virtual_currency_law_in_the_Un...

Congress may have the power to prohibit virtual currencies (VCs) under its power “[t]o regulate Commerce with foreign Nations, and among the several States”[64] and under its exclusive constitutional power “to coin Money” and “regulate the Value thereof.”[64] In a November 2014 decision, the Court upheld the power of regulators to prosecute a defendant who “designed, created and minted coins called ‘Liberty Dollars,’ coins ‘in resemblance or in similitude’ [or made to look like] of U.S. coins."[65] Although the defendant did not pass the Liberty Dollars currency as a counterfeit, the currency were in close enough “resemblance of coins of the United States or of foreign countries” and consequentially fell under the authority of 18 U.S.C.A. § 486.123 The Court has not decided if § 486 includes the power to prohibit VCs, but if a Court decides that the purpose and intent of VC resembles United States or foreign currency it may fall under § 486. The Stamp Payment Act of 1862 prohibits anyone from “mak[ing], issu[ing], circulat[ing], or pay[ing] out any note, check, memorandum, token, or other obligation for a less sum than $1, intended to circulate as money or to be received or used in lieu of lawful money of the United States.”[66] The Court has not decided if Congress has the power to prohibit VCs under this Act or any other existing regulation or statute.

Japan has already embraced cryptos as a legal currency. They won't be the last. As this happens, there will be geopolitical factors at play and it won't be that easy to simply "outlaw cryptocurrencies".

What does this mean? I'm in Japan right now and if anything, Japan is a cash society still and most small stores don't even take credit cards.

The Government has done the opposite of banning bitcoin. They've outright legitimized it.

No, they have not forced private businesses to accept bitcoin.

> If Starbucks accepted Euro in US for its coffee it would be a crime

I don't believe that's true. The US dollar is only mandatory for two things: for settling debts (the lender must accept USD to extinguish debt) and for paying taxes. Otherwise people are free to trade as they please - euros, chickens, whatever.

IANAL, but there have been laws on the book prohibiting bartering in any substantial amount for a while. Of course, the IRS is not going to chase you down for swapping with your neighbor, but large scale "bartering" is definitely frowned upon. What's to stop people bartering a yacht for a house and avoid taxes?

You can barter all you want, you just have to pay the taxes on the fair market value.

https://www.legalmatch.com/law-library/article/bartering-law...

> almost every country requires that transactions must occur in its national currency.

I've never heard of such laws. You have a source on this?

This is definitely not true, many businesses in Latin America will accept dollars, and not just in Mexico.

For this to happen there would need to be global heads of governments consensus and look how wonderfully the UN is working... it’s a joke. So the scenario you paint is impossible.

> You are from Venezuela or Zimbabwe – The government has issued capital controls and is devaluing currency by the day. You transfer your wealth into Bitcoin in order to offset capital erosion due to hyper-inflation. When the situation stabilises, you transfer your Bitcoin back into fiat.

How exactly do you transfer your wealth to BTC in this scenario? There aren't many people willing to sell BTC in exchange for a rapidly devaluing third world currency. Realistically, to use any of the large online exchanges, you'll need to convert it to some common currency (like USD or Euro) anyway. But if you can do that, why would you buy BTC, instead of just storing your money in that common currency? It's going to be a lot more stable.

People in Venezuela are actively trading lots of bitcoin every day, in person. You can see this in the LocalBitcoins data: https://coin.dance/volume/localbitcoins

This is a pretty misleading response.

So, okay, some of the fortunate people who do have access to USD/EUR are trading it for Bitcoin on LocalBitcoins, not just storing it. But you're making it sound like this is a graph of ordinary Venezuelans trading their hard-earned bolivar into lucrative Bitcoin, which it almost certainly isn't.

The y-axis on the Venezuela chart is denominated in Bolivar. I assume it's Bolivar being traded. Why would you assume otherwise?

You'd need to get it while you had a chance (see China, Japan, Korea making massive volumes and for a while a lot of the price gains). Once it all freezes up then all you can do is work/trade/exchange for the BTC or USD from those who have it just like it probably always has in situations like that.

Except now they can't literally come take the USD nor can they freeze in-country or off-shore banks so if that's a real scenario for you BTC is a pretty nice deal.

You're describing money laundering and selectively choosing to represent the positive examples of it.

I think the point is that positive examples do exist, not that there are no negative examples.

money laundering is legitimising illicit profits but disguising them as legitimate income. none of the examples above fits this definition.actually, it is the opposite - protecting your legitimate gains from illegitimate actions of government.

You are right, I am using money laundering to mean 'anonymous monetary transfer of arbitrary size/value', which most governments don't allow as far as I know.

If i carry a pocket knife, would you call me stabber? "anonymous monetary transfer of arbitrary size/value" is the knife, money laundering is the stabbing.

Neither Wikipedia [0], Investopedia [1], nor the International Compliance Association (ICA) [2] seem to agree with your definition.

You seem to confuse a technique to combat money laundering with the laundering itself.

[0] https://en.wikipedia.org/wiki/Money_laundering "Money laundering is the process of transforming the profits of crime and corruption into ostensibly "legitimate" assets."

[1] https://www.investopedia.com/terms/m/moneylaundering.asp "Money laundering is the process of creating the appearance that large amounts of money obtained from criminal activity, such as drug trafficking or terrorist activity, originated from a legitimate source."

[2] https://www.int-comp.org/careers/a-career-in-aml/what-is-mon... "Money laundering is the generic term used to describe the process by which criminals disguise the original ownership and control of the proceeds of criminal conduct by making such proceeds appear to have derived from a legitimate source."

The negative examples in this case would be equally if no more scarier.

Also unlike most people think, these days nobody has their money stored beneath their mattress.

More or less all money, is invested some where.

I'm actually taking too a few people in Venezuela who may do some work for me and I'm going to pay them in Bitcoin, it seems a much option than their currency at the moment.

Please stop posting repetitive comments to Hacker News. At this point you're spamming and that's totally not ok.

Is it considered spam because of its substance or because it's repeated verbatim?

E.g. if I take the same exact comment but paraphrase it every time I post it, would that be ok?

The reason I ask is because I see a few accounts post the same tired criticism of bitcoin over and over and see no reprisal for spam.

I would be interested in understanding what the objective rule here is, since I checked the guidelines and could not find references to comment spam definition.

Thanks.

Paraphrasing the same thing would not be ok either. People are here for conversation, not repetition.

You're still not getting it my friend.

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