Dutch official calls for complete ban on Bitcoin
cointelegraph.com
cointelegraph.com
https://www.google.com/search?q="this+is+good+for+bitcoin"
I understand what you're saying, but I find it hard to believe making Bitcoin illegal worldwide would be good for those who invest or simply believe in the future of Bitcoin.
It's difficult to know what would have happened in a counterfactual world, but most bad news also had silver linings so far.
The sooner we find out that it isn't an escape hatch, the better. We can then return to social and political hard work of curbing the powerful, instead of pretending we can just take our cryptocurrencies and escape.
I say that claim is not true, and recon bitcoin is all hat and no cattle in this regard.
I also reckon that when the government is sufficiently democratic (i.e. not just the whims of the powerful), undermining it is a bad thing, which is the only reason I don’t want to say “time for Bitcoin to prove us wrong”.
The other problem is that for every idealist crypto supporter, there's exists another thousand crypto investors who have only one intention; to convert their investment back to fiat at a profit.
The latter (the 99.9% super-majority) ensures that crypto, no matter its supposedly idealist origins, are intricately linked to fiat (virtual fiat at that).
In fact crypto has gone from being a form of anti-banker for-the-people idealist payment options to being a form of virtual faith-based shares whose value is literally linked to nothing.
But as police and criminals are in a constant arms race of what does and doesn’t work, that’s a bit like asking “how did we win wars before atomic bombs?” in a discussion about a country proposing to ban nuclear bombs.
I see some outright hypocrisy in that move being cheered by more libertarian-minded folks. If Bitcoin's supposed to be about not being forced to do things by government, then wouldn't governments forcing people to use Bitcoin be just about the worst possible thing that can happen to it? This would be like if Frodo decided to start wearing the ring and using it to try and take over the world, kind of thing.
Bitcoin has been preparing to be banned at a government level for a long time.
Unless you can pay your rent in Bitcoin, you're going to face this problem.
Does CPB actually has anything to say here? I was expecting "De Nederlandse Bank" to be the organisation to set the rules here.
Anyway, when the ministry of finance investigated a crypto ban back in 2018 they concluded that it would be completely impractical to enforce such a ban. I don't think that has changed in any way.
No. They deliver forecasts and analysis for government policy. https://en.wikipedia.org/wiki/Bureau_for_Economic_Policy_Ana...
Did you read it? If so, why do you take this opinion?
> Does CPB actually has anything to say here?
The CPB does analysis to inform public policy making, they're not a legislative body. Neither is the DNB for that matter, the Ministry of Finance would make these laws.
EDIT: ban old cars, too!
Whether this ban call should apply to itself is left as an exercise.
Could you please explain how that ad-hominem based on blatant ageism does anything to refute the points regarding the nature of cryptocurrencies?
So, you're saying Baye's rule doesn't work anymore?
all about profits, nobody care about solving problems, they just want the price to grow to make profit from their investment
I can't fault someone for making a profit by researching a technology, investing, holding for the long term, and selling. We want capital to flow to the best ideas. But this is more MLM-style dog-eat-dog money making. It's unclear how it could have been prevented.
Ultimately greed and excess ruins everything.
It solves the problem of corporate censorship. Visa for example is notorious for refusing to do business with people they don't like (porn companies, 4chan, etc). If the US government wants more people to use the dollar and less to use Bitcoin, they can come out with a public, first-amendment-protected payment system.
You're saying here that it's a problem that Visa isn't forced to sell credit or payment processing to porn sites. I'm saying that's their right under the First Amendment.
But if a customer wants to do business online with someone Visa doesn't approve of, they have very few options. And currently Bitcoin is the best option.
And if the government does not want Bitcoin to prosper, they should come out with a better alternative in the form of a public (government run) payment system so we have the digital equivalent of the dollar.
Because unlike private entities, the government is bound to the first amendment. Unlike Visa, the government does not have the right to pick and chose who they do business with.
I get what you're saying here but, the odds of someone taking actual BTC as payment are pretty low right now. It's way, way more likely I can just use another credit card company, a debit card, Venmo/Cash App/PayPal, etc. I think this argument, while common amongst BTC folks, is pretty hypothetical.
> And if the government does not want Bitcoin to prosper, they should come out with a better alternative in the form of a public (government run) payment system so we have the digital equivalent of the dollar.
The problem with this is that we'd lose lots of the tools we have to fight organized crime. These are people who run the drug trade, the weapons trade, and the modern slavery trade. It would probably also destroy our political system because of the ensuing corruption. I don't know exactly which side of the debate I fall on on this one (it's mostly the same as the encryption debate, although I think money isn't speech, but it also does seem like it sometimes, etc.), but I do know the consequences are pretty severe if we create a right to privacy for financial transactions.
> Unlike Visa, the government does not have the right to pick and chose who they do business with.
Believe it or not, I didn't exactly want to get into a BTC discussion here, I was trying to focus on your claims about 1A. I think this is another false claim; the government chooses who they do business with all the time--there's a contract bidding process, there's affirmative action, etc. etc. The government simply can't tell us whom we can do business with (as long as they're also Americans).
It's the only way you can buy a 4chan pass for example
>The problem with this is that we'd lose lots of the tools we have to fight organized crime
Well right now we have bitcoin where there is high anonymity and the government has no power over. In a government payment system they would have the power to freeze accounts and track transactions. I don't see how that's a worse system in regards to fighting crime.
>I was trying to focus on your claims about 1A
You completely misunderstood my original claim and went on a tangent bringing up common talking points. As if it were a knee-jerk reaction to seeing the words "corporate censorship" and "first amendment" in the same paragraph. I'm still not sure that you understand.
Sure, I said "It's way, way more likely I can just use another credit card company, a debit card, Venmo/Cash App/PayPal". There are zillions of products, you named one for which there's very little demand, it looks like we agree.
> Well right now we have bitcoin where there is high anonymity and the government has no power over.
At least the US government regulates BTC. Lots of people have been arrested for violating finance laws re: BTC. The US could easily outlaw BTC or mandate further regulation. BTC is also not at all anonymous, the only thing that makes it "anonymous" is a tumbler.
> In a government payment system they would have the power to freeze accounts and track transactions. I don't see how that's a worse system in regards to fighting crime.
> You completely misunderstood my original claim...
Yeah, sorry again I wanted to dispute your 1A claims. Insofar as your idea of nationalizing a payment infrastructure and using a blockchain, I guess that's fine. I broadly think most things don't make sense as markets, and in democratic societies people should nationalize almost everything. However, I don't think blockchain should be involved because it's generally junk tech. It's like, yet again a normal database would be just fine.
What worries me more are some "inhuman" traits in cryptocurrencies. Most notable is one where if your crypto gets stolen, there is no standard way to "enforce the justice" by catching the thief, and give the money back to the rightful holder. This is something very non-intuitive and I doubt majority of people would accept this model.
I agree, there is literally not a single wide spread us beyond the aforementioned.
But seriously, what's the difference?
You simply don’t understand what is that energy used for. It’s definitely not for processing transactions.
Your understanding of how it all works is simply flawed.
Energy is required to satisfy difficulty requirement, which has to do with chain security, not with transaction processing.
When people say "transactions cost X amount to process", they mean "in the current state of bitcoin", not in the past when there were very few transaction validators. The more transaction validators (typically called "miners") there are, the higher the cost of validating a transaction, due to Bitcoin's difficulty scaling.
I'm not sure why you separate out chain security from transaction validation and treat them as separate, when the chain security is there to protect against invalid transactions. It's sort of the entire point of it.
there are only so many miners (and so much energy spent) because security of bitcoin is what gives it value. so when people say "transactions cost X amount to process" they are saying something non-sensical, because it's not transactions that cost, it's security of those transactions.
it's important to separate, because there are many kinds of transactions in bitcoin ecosystem with various security characteristics that land anywhere from very low to on-chain settlement with multiple confirmations.
Logically wrong, but let's follow the reasoning.
Let's assume Bitcoin transactions were indeed not secure (and thus, according to you, costing little energy).
- Would these unsafe-but-cheap transactions still be considered "Bitcoin transactions" in the way that we know them? - Would these unsafe-but-cheap transactions fulfill the requirements that Bitcoin has in place for itself? - Would an unsafe-but-cheap Bitcoin still be a great option in your eyes to replace the worldwide financial system?
If you agree with all these statements and their corollaries, I can follow you in saying "Bitcoin transactions do not cost energy".
You are creating a false dichotomy: security is an integral component of bitcoin transactions, and if security costs, transactions cost as well. You cannot just summon it away and pretend it is unrelated to the nature of Bitcoin transactions itself, when in fact it is one of its largest selling points.
that would be true if only on-chain settlements would count as transactions in BTC ecosystem. there are more ways to exchange BTC with security landing anywhere between very low and on-chain settlement.
thing is, that it's not even transactions that have security, it's blocks. energy is spent to make sure that it's expensive to override/rollback blocks. and it's true that blocks exist to assert ordering of on-chain settlements, but it's not true to claim that there is 1-1 correspondence between on-chain settlements and transactions.
each on-chain settlement can embed trillions of bitcoin transactions (in colloquial sense, exchanges of an asset). what does that do to your "energy per tx" metric?
perpetrator in this case being people who want to secure their assets via energy expenditure. if bitcoin disappears - exactly the same amount of energy will be used because the cat is out of the bag - satoshi showed the world how asset security can be expressed as energy expenditure and for as long as there is a demand on the market for that kind of security, energy will be spent.
The statement is essentially "guns are bad, more guns means more death, less guns means less death" which is far from nonsensical independently with how much you agree with it or not.
Bitcoin transaction use energy. The proof is that if no more transaction happened no energy would be spent in bitcoins.
saying that it is the security requirements that waste energy is like saying that bullets are the real culprits not guns: they go hand in hand. Bitcoin without security is no bitcoin at all.
It is technically feasible to have bitcoin with no security just like you can have an army with rifles and no bullets.
In both cases obviously the root cause is people, we still haven't found out neither our lucertoloid overlords nor the simulators to blame, so it is lapalissian: "people are the cause of people's action" but it is not a particularly useful rebuttal to many arguments.
That is not proof that bitcoin uses energy, in fact bitcoin only does about 2k on chain settlements every 10 minutes, and it has been like that for a decade, but energy usage has grown multiple orders of magnitude over that time period. Obviously energy is used for something other than transactions.
many people claim that eventually Bitcoin will be able to be extremely power efficient (with the lightning network and whatnot), I have no idea about how these planned future improvements work. but today transferring Bitcoin (the main action that users of the network are supposed to perform) consumes a lot of energy.
you are clearly more knowledgeable about Bitcoin than me so if your position is that the internal operation called "transaction" nodes perform consumes a negligible amount of energy I have no qualms with it.
but I believe I have overwhelming external evidence that the operation called transaction by the laypeople users of the network to transfer ownership and grow the blockchain in any meaningful way under the dynamic consensus model uses lots of energy by design.
Edit: upon reflection I feel like what you are saying is that the nodes "consume" zero energy, but that I as the Bitcoin use am asking them to burn energy to produce a more secure block that will be better accepted on the blockchain. So the operations themselves consume nothing but rather use the value of energy as ingredient that ends up inside the block as stored value. I you are arguing this I can see how you could say that in good faith, I would still think that is a completely backward opinion
they already work. every on-chain bitcoin settlement can represent trillions of BTC exchanges. same as interbank settlements - done once a day, represent millions or billions of individual transactions. what does that do to your energy / tx metric?
> but today transferring Bitcoin (the main action that users of the network are supposed to perform) consumes a lot of energy.
transferring doesn't, securing it against an attack does.
> operations themselves consume nothing but rather use the value of energy as ingredient that ends up inside the block as stored value
that's exactly right, people that choose transacting on bitcoin chain do so knowing that they pay for certain level of security and you can see it from the correlation between bitcoin price and bitcoin hashrate. it's a system with many feedback loops that self-balances at a level of security that is demanded by the market.
you may think it's backward opinion but i appreciate that you recognize i'm not arguing in bad faith.
Not at all. The efficiency of the network is intentionally degraded such that the rate of Bitcoin transactions remains constant despite the increased energy use. You are assuming that the energy is being spent for some tangible benefit, and drawing conclusions from that assumption. I would say that the energy is being wasted, with the sole result being a receipt showing how much electricity has been thrown away.
I don’t assume, I know what it’s being used for - security against chain overrides/rollbacks.
Still less than the carbon footprint of the people running our current fiat-based financial infrastructure.
It's the bankers who have jets, mansions and yachts, not the bitcoiners.
Edit to clarify:
Not that riches is somehow "wrong" - it's just that with major value comes major costs, which in practice mean major energy usage.
Why does the currency have anything to do with the wealth of the bankers.
Bitcoin is, as far as i know, a fiat currency too. The value depends on the believe (demand-supply) of the people. You accepting it as means of payment gives it value.
The reason bankers and others have yachts are interests, Investmens, tax avoidance schemes and so on. Nothing Bitcoin solves. The issue is a political one and how we do business and laws.
One is literally supporting the world and the other is used by a few million people as a speculative asset, money laundering scheme or to buy drugs online.
And on top of that you're wrong...
And please explain how my question is ignorant but the stance you're taking isn't?
Bitcoin isn’t using any energy, bitcoin is a marketplace where security of financial asset is represented in terms of energy expenditure.
You may not like how much energy is spent on maintaining security, but it’s not bitcoin that necessitates it, it’s the market.
Bitcoin opened a Pandora’s box by showing the world how it can be done and now if people say they want an attacker to take 1gigawatt to overtake the network then that’s what will be spent to protect against such attack. With or without bitcoin.
> If you made a Bitcoin miner that is two times more efficient - it wouldn’t lead to reduction in energy use, it would lead to increase in difficulty requirement
this is not considered problematic for something meant to replace current army-based currency. It points toward a direction where the economy becomes a zero-sum game.
Security of assets is understood to be best effort and preventive measures are well known to be unreliable (often replaced by inefficient punitive measures).
Bitcoin strives to build a trustless economy and thus its operation has far greater costs (fraud prevention with usual money generally costs proportionally with fraud attempts, while bitcoin is constantly tuned to 100% prevention).
In a more fair comparison we should compare the cost of all the world police + law enforcement + armies to the cost of mining energy + mining hardware and even given conservative estimates of corruption it isn't clear which side would be better under the total cost metric.
We could stop here and consider bitcoin an (almost) infallible trustless economy based on burning commodities compared to our usual fallible economy based on trust and force.
Personally I fell that this comparison suggest that bitcoin _should_ remain like it is today, relatively small with little influence on the world as a whole but readily available to who might need its peculiar service.
Bitcoin
Currently, the answer is a little over $6: https://bitinfocharts.com/comparison/bitcoin-transactionfees... That number has been over $50 on occasion.
He also says that he isn't afraid that banning Bitcoin will fail, because a ban would lead to a crash.
1) BTC replaces all world currencies, then crashes to $0.005/BTC (PPP)
2) BTC crashes today to $0.005/BTC
In which hypothetical does the crash cause least damage?
I wonder if the dutch government bans Bitcoin, that means that there is no need to declare anything. After all, it doesn't fulfill any function as money, means of payment or store of value.
https://money.cnn.com/2013/02/28/news/economy/illegal-income...
That doesn't mean anyone expects it to actually happen, of course.
Bear in mind the various "interesting people" may not include "the general public", despite this being in a general public newsfeed. Or, as I expect is probably this case, they may be interested in "the general public's" reaction but it may be a secondary goal vs. simply using the news media to gauge the response from the rest of the financial industry insiders.
This directory is likely to get various calls from various important people making various points pro or con now. Sometime in the next couple of weeks there will probably be some other release from this organization couched in diplo-speak. That is, if they say something like "decided not to pursue this at this time" it's quite possibly because their inbox was a sea of flame from the important people, whereas "are continuing to consider the matter" means they may have gotten conflicting, neutral, or tepid responses, and "developing a plan to pursue this matter going forward" means they may have gotten uniformly positive responses behind the scenes and a strong order from the Powers that Be to go ahead and be the ones who pursue this and take the heat for doing it. But in diplo-speak you almost never make strong commitments, you just barely deviate from "neutral" and expect people in the know to pick up what you're laying down.
I’m curious how the energy use of just a top 5 retail bank compares to Bitcoin.
Chase [0], for instance, has over 5,000 retail locations and 16,000 ATMs. And the servers, and call centers/corporate offices to support 200,000 employees. And the cars they drive back and forth to those offices, and the construction of new ones, and flights (some private), etc etc.
How much energy does that use—let alone the physical resources and their attendant carbon and energy use?
Then you have another 4,500 branches from Bank of America, 7200 for Wells, etc. And that’s just the US.
Not equivocating, nor arguing that Bitcoin could replace all their functions, but I think there might be more nuance to the energy argument, especially when at least other crypto currencies have an off ramp with their energy use via proof of stake.
> The highest estimates for Bitcoins annual terawatt hours consumption is 28.67. This means, more than 3 times more efficient than a very conservative calculation of the cost of the global banking system.
I think that a "transaction count" and/or "services provided" are missing from the calculation.
ultimately it does nothing to answer the only relevant question: if the entire banking/financial system switched to bitcoins/crypto would consumption increase or decrease?
I personally think it would be very hard to argue the case of a decrease
How do you effectively ban circulation of certain types of information?
The entertainment industry didn't manage to achieve this over the last 20 years.
The entertainment industry has been unlucky that it hasn't managed to make the use of torrent illegal. They have to monitor the trackers and figure out who is sharing their copyrighted works and then send threatening emails and hope someone will comply. Instead since they would be banning cryptocurrencies completely they would be able to straight up block connections to cryptocurrency nodes.
You could still use a vpn to use cryptocurrencies, but still buying cryptocurrencies with money would be difficult enough to dissuade most people from doing so.
Then it’s simply a question of confiscating whatever you turn your Bitcoin into. It’s usually how they deal with criminal gangs as well. “Can’t prove how you managed to buy a million dollar mansion while being unemployed?”, it is now the governments property… The primary reason it doesn’t really work on crime in general is because most of the money doesn’t stay where the drugs are sold, but most Bitcoin speculators/investors aren’t setup to live outside “the law”.
In Holland it could be as easy as simply having the banks confiscate any money that arrive from exchanges and blocking any transfers in the other direction. It wouldn’t exactly end Bitcoin as you point out, but it would make them rather worthless to most people.
This is an important question for our right to privacy too. Lets say that we succeed in replacing law with code, which we are doing but not very successfully. We can not rely on hardware like DRM does. We need to integrate a censor into the network.
Something that might work is a system like Ethereum's distributed virtual machine, and a much more involved version of smart contracts. Then you could fingerprint your private data, upload your fingerprint to each smart contract platform, and financial penalties are applied to those who transfer your data on the network without your permission.
I think we can replace most of government functions and services with a selection of apps that you subscribe to / tax you. I recently started working in earnest on the idea after being inspired by Project Cybersyn's planned economy.
You can make the cybernetic system democratic by treating likes/dislikes as votes; data to feed a recommender algorithm with. If the algo is expensive like NNMF you can use that as proof of work with real value. With enough data, the algo becomes a personal agent which can predict how the digital citizen will vote, and possibly able to do work with real value. It could perhaps negotiate a smart contract for you without interactivity.
IMO, if the Netherlands bans bitcoin, they will also ban other similar cryptos that could actually be used as currencies. That negatively impacts the crypto markets for sure. It's not just about bitcoin.
Would such a ban be hard to enforce? Sure, but not everyone feels comfortable doing things that could land them huge fines or even jail time. I certainly don't.
Gold is used as a store of value because it's been universally recognized as valuable for thousands of years, in almost every culture. Would you really trust your life savings to bitcoin if we're in a climate where more and more countries are banning it? That would make redeeming your digital gold increasingly more illegal and difficult. Crypto bans definitely erode the "digital gold" proposition as well IMO.
And even so, how are you suppose to ban people from "holding" crypto. Transacting I can understand. But holding simply involves storing or remembering a private key. Are you going to ban people if you find a decade old USB stick with a cold wallet? Will you interrogate people, Clockwork Orange style, to make sure they forget their brain wallet phrase? If somebody was using the same public/private key for their other data will you force them to delete their entire crypto identity?
So does USD
> Fiat money does not have intrinsic value and does not have use value. It has value only because a government maintains its value, or because parties engaging in exchange agree on its value.
But it's silly when people bring up the army or military when it comes to the USD or other fiat currencies. As if the only thing keeping the dollar valuable are carrier strike groups threatening people around the world. If military spending was cut in half, I guarantee you the dollar would be just as valuable.
China, Russia and North Korea all have formidable militaries. Their currencies carry very little weight outside their borders. In contrast the Swiss Franc, Swedish Krona and New Zealand Dollar are all considered ultra-hard currencies despite those countries having little to no ability to project force around the globe.
Nobody ever thinks about this, but government and all the infrastructure it owns are embedded in society
The general view is that Bitcoin takes hold among the population and then there is a fight between the population and the government....quite the contrary, Bitcoin simply takes over the government at an equal or slighly inferior rate compared to the general population.
See how many people in the Capitol are being bitten by the bitcoin bug. For every critic you'll find somebody who is willing to speak in favor of it.
Bitcoin mining only protects the currency and since Bitcoin is exactly like fiat in the sense that it is just a ledger that allocates resources, it is entirely dependent on the physical world that the all the militaries around the world protect. Do we count the US military towards Bitcoin's impact on the climate? It would be justified.
What portions of the government and military could be dropped if the US dollar hegemony didn’t need to be maintained? What could be dropped if we didn’t need banks to handle money?
This is of course impossible to quantify accurately, but it shows the picture isn’t as simple as “ban BTC because it uses more power than Argentina”; an angle that’s thrown around a lot around here.
I want to see blockchain gone but most legislators don't understand it, they think it should be gone but they are not sure why so they end up with nonsense like this.
It's a bit of a weird situation. Normally when a currency is legal tender and not fiat it's backed by a physical resource, like gold or silver.
But here it's only backed by software and people agreeing that it has value. Kind of puts bitcoin in its own unique category.
It's probably timed right now by the Dutch CPB because El Salvador accepted BTC as a fiat currency.
Cryptocurrency does too but the problem is that the size of the economy that accepts Bitcoin as payment is absolutely tiny. You have to exchange your Bitcoin to fiat first before you can buy anything, which means Bitcoin will just end up driving more USD acceptance.
Sounds pretty valuable to me.
https://www.forbes.com/sites/davidblack/2020/03/01/who-needs...
More seriously: the USA really needs to retire the $1 notes from circulation a decade or more ago.
The USD is the official currency of the US of A, and all transactions and specially taxes are expressed in the official currency. This its value is automatically tied to the nation's total economic output.
The only ones who maybe can do it are Xi and Putin, and the latter seems more pro than against because everything which goes against the dollar is Putin's friend.
Xi is also on and off again with Bitcoin but every day which goes by in which he is not decisive is a day in favor of Bitcoin.
You are left with the Warren, Sanders, Corbyn types as well as this Dutch guy who have only one style of messaging: modern day Robinhoods (or Pocahontas) trying to take money away from people who work and make sacrifices to get ahead in life and redistribute it to themselves
https://www.buybitcoinworldwide.com/how-many-bitcoin-users/ estimates there are around 15.3 million people in north america, and of those how many actually care deeply about this issue? Additionally, realize that how much this hurts dramatically depends on how such a ban were to come into force.
I mean - I don't think there's a chance in hell Biden will ban bitcoins, but rather because it's just not a priority, not because this is electoral suicide.
2) You are getting your data from the wrong source, Coinbase alone has 56 million verified users. And unlike FB those are real , not bot, as every user have to be KYC'eed for AML purposes. That's just one exchange.
3) Also with regards to those millions of users, the situation is peculiar because it's for sure one person per family (the millennial or the college kid). So you enrage one person, but that person then would badmouth you with all the people in their close family who were otherwise neutral to the BTC ban, but now that you hurt their son finances, they just aren't anymore.
If you are somebody who wants to win an election, whose vote are you winning by proposing and/or signing a bitcoin ban?
It's not like Bitcoin has a CEO that you can point at in the Forbes billionaires list and claim that you are going against him.
You have to explain and present to people the coins per wallet distribution statistics and convert it to dollars to get to the topic of inequality, then from there trying to equate Wall Street to Bitcoin.
It's not easy, even for a socially competent person, you lose the room and people's attention quite easily. It's far easier to attack Bezos
If a politician were to try and ban this, I'm sure compentent spin doctors would think of better lines of attacks than bitcoin == rich people == evil. They might throw a line in the direction of nationalism (chinese control, dangerous!), or note its environmental impact, or note the risks due to instability (so we'll compensate you small fry, but not <xyz>), or claim a connection to organized crime, or note the issues of tax evasion...
I mean, it's not hard to come up with a list, and I firmly believe - not just because it's crypto, but just in general - that people just dont care about this kind of technicality. To be clear: they would need to buy out at least the vast majority of current holders or some such scheme to at least take out the sting for most people - but then, that's something that's attractive to a few special interests too, so that could well fly.
But why would they bother? It's just not going to happen.
BTC is framed as destructive or dangerous and CBDC is their solution.
The same conclusion was arrived at in a recent Senate hearing chaired by Elizabeth Warren. Three out of four of her panelists had connections to the World Economic Forum. The fourth had connections to the US central bank.
https://www.banking.senate.gov/hearings/building-a-stronger-...
https://www.weforum.org/people/neha-narula
If we're operating under the premises of democracy, there's something troublesome about a single think-tank and their unelected technocrats dictating public policy. One would expect at least some dissenting views in the conversation.
As it concerns the individual's freedom to transact in the cryptocurrency of his choice, longtime proponents of a cashless society have a distinct bias.
Assume for a moment that BTC actually was destructive and dangerous. What would you expect the response to be from these people?
https://decrypt.co/25190/the-world-is-accelerating-towards-d...
It's hard to refute their point when we've just saw bitcoin tanking and seeing its value drop to half in a few days.
Creation exceeds destruction, and the former does not require the latter.
Technically yes, but there are always exceptions. Just because a well oiled and well functioning free market economy can be positive sum doesn't mean we have such an economy. Things can get really weird and backwards over the short term. The problem is that the short term can last decades and may waste a quarter of a human's life and cause irreparable damage. Therefore we should make the economy as positive sum as possible.
For example, we have in our mind that every single individual is supposed to take care of themselves. This implies that we have to contribute to society by working but full employment isn't guaranteed, there there may be a large chunk of the population that is without a job over the short term. The pandemic is a pretty good example.
A simple solution would be to just give them a temporary job, even if the job is stupid or pointless (think Keynesian gold digging). These people receive a salary and proceed to spend it on actually useful things, which will create useful jobs. By useful I just mean something someone wants, a government deciding to produce something may produce something nobody wants (see the Trabant). Those products not only need labor but also natural resources so they are twice as wasteful. Of course you can skip this whole work thing and just declare that finding a job is your job and increase unemployment benefits like Biden did.
Of course there will be some inflation but economic activity is a good thing.
Or oil and real estate.
They keep going up and down in a completely unpredictable manner !
Can’t make this up
Pretty weird seeing the BTC crew all crowing about that kind of sad endorsement of a desperate government.
What if, like, you know, solving problems like 70% of the population not having a bank could actually reduce crime. Bitcoin is a pretty easy fix for that problem.
And “it’s a tiny country”…like do they not deserve a better life since they have such a small gdp. This is the most inhumane sentiment I keep seeing about this news “who cares, they are a tiny country with small gdp”
I mean, if you don't have a bank account - "here, store everything you have on this phone [do you own a smartphone?], that requires an internet connection [can you afford that?]" - seems like a bigger step, no? Unless I'm missing something obvious?
Blockstream is working to make internet more accessible there. It’ll be interesting to see how much penetration they get and how much it’ll cost folks there.
Doesn’t need to be a brand new iPhone, but I do agree that phones are an initial cost and I’d be interested in seeing what are low-cost smart phone options there.
That said! The Bitcoin Beach experiment there was enough of a success https://apnews.com/article/caribbean-el-salvador-bitcoin-lif...
> Gerard said it appears to work because the bitcoin donor keeps pumping bitcoin into the village’s system. “That’s not a proof of concept that works. That shows that you can trade this stuff if you’re not trading actual bitcoins and someone massively subsidizes it.”
> Edgar Magaña was in town from San Salvador to convert $50 to bitcoin. He inserted the dollars into the machine and was surprised to see only $47 in bitcoin fractions credited to his account on his phone. “They took three dollars commission,” Magaña said, adding that he had understood there was no commission. “This is like in the banks.”
Notice you cherry picking only the negative quotes…
I’d be shocked, and annoyed, if those fees continue in the future as the infra scales up
It is really odd until you reveal below that you have a pretty clear bias against Bitcoin because you personally worked on some traditional payment processing software.
As to the "clear bias", I literally laughed out loud at that hilarious claim. You seem to have a fundamental misunderstanding about this entire discussion.
Firstly, I don't work in that realm anymore, but secondly it's _irrelevant_ because the product that I worked on could as easily be "backed" by BTC (in fact it is used in multiple jurisdictions backed by various currencies. The net is that something of value can be transmitted between users). None of these payment systems -- including "Bitcoin Beach" -- actually operate off of the BTC blockchain (you know, because it's completely broken trash).
My bias against Bitcoin is that it is a garbage solution that solves literally nothing -- it is one of the worst solutions in every single claimed use -- but that we have to constantly hear a million pathetic salespeople for it because they've "invested" in it. If there were a thousand pet rock HN commentators pitching pet rocks in every discussion I'd shit on that too.
But, looking at the fundamental properties of BTC, it does have better properties than USD. It’s just not adopted enough to be stable…but you at least gotta admit that, over time, can change
Yes, the USD is better for hyperinflation *right now* than BTC as it is more stable.
But I do think BTC has better properties that, in the long run, will prove superior to the USD and gold in environments of absurd inflation.
Hal Finney basically knew this in 2009
Elizabeth Stark knew this in 2014 and started Lightning
You used El Salvador to try to legitimize BTC. As a tiny economic "power" (literally 7-11 sized), with a functionally broken government, it counts for somewhere approximating zero in legitimizing the farce that is BTC. The only people who think it is notable are BTC hypesters.
https://apnews.com/article/caribbean-el-salvador-bitcoin-lif...
The smallness of the country doesn’t mean this isn’t significant. They have problems, and through an experiment found solutions to those problems and are scaling them up
Bitcoin has shockingly little to do with El Salvador. It is a lightning network being pitched (which could be funded by USD, gold, eggs, turtles...whatever), trying to pump BTC in the process.
So save with the feel good El Salvador story.
Well that’s where I disagree with you.
What happened with those apps in Africa? And why is Nigeria increasingly looking to BTC? Could also be corrupt central banks, which I admit is less an issue in El Salvador.
Bitcoin is also censorship resistant, Nigeria tried to ban BTC but P2P usage went up after the “ban”.
And to be clear: I don’t think BTC is necessarily THE BEST conceivable solution out there - a USD backed coin probably is better for ES in the next few years.
But I also do think BTC is better than status quo for ES
https://www.reuters.com/world/americas/el-salvador-approves-...
From the article:
> With 62 out of 84 possible votes, lawmakers voted in favor of the move to create a law to adopt bitcoin (...)
> (...)
> Its use as legal tender will begin in 90 days, with the bitcoin-dollar exchange rate set by the market.
The US treats them like shit since they have the USD as currency. God forbid a country wants more independence
70% of the country has no bank, for Bitcoin all you need is the internet and a simple wallet app.
The delusion regarding crypto has reached parody levels. This reads like something out of an Onion article.
They're basically creating cash accounts? Not quite a bank but... not far off it. I feel like a simpler solution is just mandating that banks are required to offer a basic cash account at a set maximum cost.
It doesn't feel like the bitcoin part of the experiment is really doing anything special. It's all in a single app and all held by a holding org. They just track who has how much of the reserve.
Not really the free and open bitcoin?
Either the rich people are coming to the poor country (export oriented economy) or the poor people are coming to the rich country (remittance oriented economy).
If your economy is suffering from high inflation then remittances are a balancing force that is fighting against high inflation because people abroad are exchanging their USD/EUR for the inflating currency and thereby support attempts to peg the inflating currency to USD/EUR which are currencies with low inflation.
One option is Bitcoin
El Salvador doesn’t have too much inflation since it uses USD. In their case, independence from USD is also a goal
Back when I didn’t have money, opening a bank account was way cheaper than leasing a phone or buying one, so I don’t see how that makes sense other than you can do other things with the phone to amortize the cost.
How can they say that with a straight face knowing what’s going on in El Salvador
For example in the UK we have Direct Debits which are backed by the DD Guarantee. If a DD is wrong or fraudulent the bank must refund you without question and they initiate a DDIC (indemnity claim) against the creditor bank. This could not happen with Bitcoin.
Same for problems such as push-payment fraud - they are rolling out confirmation of payee to try to tackle this. How could Bitcoin be a viable payment method in it's current form when addresses are anonymous (in the context of PPF)?
70% if people in ES don’t have a bank acct.
50% have internet.
Take a look at the Bitcoin beach experiment
https://apnews.com/article/caribbean-el-salvador-bitcoin-lif...
It would make sense to point to Venezuela or Iran, but those examples don't get much attention for some reason.
That bit at the end about Gresham's law made me cringe. This guy doesn't have any business talking about money publicly unless it's asking questions and taking notes.
At least that is the idea, but in reality, it is a long way from that view. The issue is that people don't really buy into a consistent vision on what Bitcoin is and are still trying to figure out how much they value it and do price discovery. Let alone how it should be legislated. That being said, I believe the storage of value is a real problem and Bitcoin, or something like it, could be a valuable financial tool in a decade or so, once the dust has settled.
It reminds be a bit of the Internet back in the early 90s. All kinds of discussions and speculation, most of which ended up being very wrong, but the core technology ended up being dominant.