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Comment by rudderz | Hacker News Reader

Take crypto out of the equation, what are the implications of the fed issuing a programmable currency? Many financial services would become obsolete. What do I need a stock broker for? What do I need a bank for? You have Wall St and other sophisticated investors profiteering and competing against the general public, devaluing our purchasing power, making leveraged trades because they know the public will hold the bag. It's a system that exists to favor the few and it's time to disrupt the orgy.

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> It's a system that exists to favor the few and it's time to disrupt the orgy.

I've got news for you:

BTC: 2% of the anonymous ownership accounts that can be tracked on the cryptocurrency's blockchain control 95%[0]

ETH: Just 376 People Found to Own a Third of All Ether Cryptocurrency[1]

[0] - https://www.bloomberg.com/news/articles/2020-11-18/bitcoin-w...

[1] - https://www.bloomberg.com/news/articles/2019-05-15/just-376-...

Are you familiar with the concept of cold wallets held by exchanges? https://www.longhash.com/en/news/3257/A-New-Way-of-Measuring...

I am. What's your point?

If you don't think crypto, an anonymous unregulated security, is being manipulated by a small amount of people then I have a bridge to sell you.

I think that OP's point was likely that many of these wallets are actually cold wallets for exchanges and institutions, rather than individual whales. The article's definition of whales is pretty loose anyway: "individuals who hold their assets in digital wallets and not on an exchange".

The majority of economic activity is not "programmable"--if I order a ship load of steel from some country, how is that contract going to be enforceable/verifiable with cryptoeconomic techniques?

Economic != financial, which was the point of the parent I believe.

Finance is one of the largest sectors of the US economy, it is central to its role in leading the world economy.

Additionally, finance is what controls and directs the economy. It is the business of money itself, in both the public and private sector.

Banks play a central role to any economy. Digital currencies can be centralized and controlled in the same way as any state owned enterpeise.

The vast majority of finance deals with "real" assets--stocks of companies (arguably blockchainable, like the Topl thing that a sister comment mentioned), commodities (e.g. futures), logistics, etc etc

Not sure how that all can be trustlessly secured with blockchain technology

That's not programmable today, but may be in the future.

Presumably the shipment has a series of checkpoints, which add some amount of traceability. There's also the potential for insurance for blockchain contracts.

I only recently learned about oracles, but I suspect we're only getting started on unlocking the potential of blockchain.

If there are oracles making the progress at each checkpoint along the way available from the blockchain, and insurance contracts for potential disruptions at each stage, your contract can ensure payment on delivery, and the supplier can be insured against any disruptions.

Who operates those checkpoints? Isn't there going to be some sort of implicit trust there? Even if somehow you built a machine that executes instructions that is verified on the blockchain, how are you going to make sure that machine's firmware is secure?

edit: I think this is a valid thing to tackle potentially as a company, but right now it seems impossible.

Any discussion of programmable currencies is always going to run straight into the oracle problem. It is extremely hard to join on-chain to off-chain things without dragging in a party that is implicitly or explicitly trusted. And the moment you do that, the purpose of cryptocurrencies goes away, as a single database run by the trusted authority is several orders of magnitude more efficient and convenient.

A firm created at Rice University is actually trying to solve exactly that problem. [0]

[0] - https://statistics.rice.edu/news/student-founded-blockchain-...

And how exactly are they going to blockchain-ify the coporation's interactions with other normal corporations?

I don't follow it at enough of a detailed level other than to know the UN is using it as a proof of stake concept for the transactions, and then reimbursing the token holder in their local currency (caveat - I think this is correct, but again I'm not involved with them at any detailed level).

You may also want to see these for more info:

https://www.forbes.com/sites/darrynpollock/2020/02/27/blockc...

https://www.businesswire.com/news/home/20201203005110/en/Tra...

Why are you asking this question here? While I agree with this idea, it has nothing to do with crypto.

If the fed did a cryptocurrency, it would be backed by the full might of the US Government — and all the things that the government can do if it decides to print more money. This also includes military and police powers.

Which brings me to the other point: currencies are governed at both ends; at issuance and at use. If you use a crypto that’s not approved, the government can simply arrest you for using one of its competitors. The treasury could likely do this without even needing to issue new laws, just new guidance. Governance is the reason for the existence of the US Treasury and Federal Reserve. It’s a core feature of any currency and the government isn’t going to abandon that lever of hard power. They’re only going to do a cryptocurrency that gives them more power, not less.

All of the stakeholders you list have a vested interest in not being disintermediated. They’re also deeply embedded in policy creation. I can’t help but notice the way crypto evangelists speak of crypto is the way leftists speak of Marx: in very vague terms outlining a utopian vision of a new economic paradigm that is frustrated by the sticky realities of the momentum of money and power. The reality of Marxism is different from the utopia, as would be the realities of central bank crypto (hint: it’s gonna be authoritarian af).

I can see value in democratic nations agreeing to use a single global blockchain they've created, without an MLM-Ponzi structure redistributing wealth simply because of adoption/use (consensus by agreement, not through greed/financial gain).

Totally would never happen; it would require too many people to give up too much power. See also Brexit (the UK never fully integrated into the EU over this exact currency control issue).

I almost think the several countries that remain in the EU which choose to avoid or delay joining the Eurozone are better examples. While the UK evidently had other concerns with EU membership besides the Euro, even pro-EU governments seem to encounter opposition when it comes to the currency union.

https://en.wikipedia.org/wiki/Eurozone

I agree. That's why China is doing it.

wow, the DCEP is the big brother version of crypto currencies; https://www.inaa.org/how-does-chinas-dcep-currency-work/

"Instead of relying on forecasts and estimates, the data collected by DCEP payments will provide China’s central bank with a treasure chest of information that can be used to monitor economic trends, predict consumer behaviours and resolve issues before they would normally reveal themselves."

Do you know more about the DCEP? who is setting the rate? How do they support offline transactions? Do they have contracts?

US is not the only country in the world. There are many countries whose currency and government are much weaker to fight such an adoption.

Exactly. I think all of the people that say "Crypto doesnt solve any problems" just live in countries with strong institutions which dont have the problems crypto solves. Even in those places though crypto is useful as a hedge against institutional failure.

Exactly, money is a reflection of power.

Humanity already solved this problem: https://en.m.wikipedia.org/wiki/Tax

Most white collar crime is obvious and where the bodies are buried is largely known.

There’s simply no political will to do anything about it.

Crypto becoming mainstream isn’t going to change indifferent minds.

Physical reality is a thing. Burying our heads in ephemeral concepts is distraction, not change.

We need to fix how we select our representation.

Winner-take-all elections lead to weak control over who represents your interests. It's like being party to a lawsuit where one attorney represents all parties.

And you can't fire your attorney for four years.

In the single attorney situation, SELECTING the attorney would be the major struggle. And then that attorney has all the power. The parties would then have to lobby the attorney to win the case.

And that's why our elections have become such a struggle and why lobbyists can buy votes.

And that's why Wall street firms can call up their friends and get a multi-billion dollar bailout.

>What do I need a stock broker for?

You still have that stuff with crypto, just crypto exchanges not stock exchanges.

>What do I need a bank for?

Banks do two main things - taking savings and lend that out as mortgages. Crypto has been no good at part two.

Basically most financial services would still exist if in modified form.

P2P loans already exist and are only becoming more competitive as the market grows. This (Bitcoin) will cause a complete disruption of the financial system given enough time.

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