Comment by Zababa | Hacker News Reader

Comment by Zababa | Hacker News Reader

Interesting read. One thing I don't understand is that he still presents decentralization as something to strive for (as lots of people in the crypto space do), but then he criticizes the consequences of decentralization:

> Despite claims of “decentralization”, the cryptocurrency industry is controlled by a powerful cartel of wealthy figures who, with time, have evolved to incorporate many of the same institutions tied to the existing centralized financial system they supposedly set out to replace.

> Cryptocurrency is like taking the worst parts of today's capitalist system (eg. corruption, fraud, inequality) and using software to technically limit the use of interventions (eg. audits, regulation, taxation) which serve as protections or safety nets for the average person.

From what I understand, people in that space seem to think that because something is decentralized, people will automatically distribute equally between themselves power and authority. That seems really naive. As with any "free for all" type of space, the law of the strongest applies. The "cartel" that he speaks of taking control of crypto is a natural consequence of decentralization. An important part of central authorities in the modern world is to guarantee some freedom from exploitive forces. Democracy, unions, laws are a way to achieve that goal.

I wonder if it's a consequence of people thinking about the state as fundamentally bad? I often see criticism from some people, both left and right-wing, that the state is good for nothing, but it seems clear (in the view of the author) who wins when the state can't exercise its authority. Maybe it's time for some people to review their views about decentralization and its consequences.

Yes, that worldview, i. e. that the intangible structures created by societies (governments, laws, banks) are inherently bad is rather popular with the tech crowd. Witness how they approach free speech issues, putting all their stock in technological solutions (Tor) while generally either complaining about relevant laws or cynically dismissing all initiatives as corrupt.

With regard to central banks, the community is at about the level of the 1920s, where monetary policy was arguably worse than some default law of physics, like the availability of actual gold, might have been. That ignores the bit of history that came later, and the progress that’s been made. That’s why they’re all afraid of runaway inflation, although it has not happened within anyone’s lived experience in western democratic countries.

It’s fun to remember how paranoid the crypto community was at the beginning of being targeted by governments for encroaching on their power. When, in reality, the response was mostly just benign curiosity, and governments only reacted when there were tangible harms to prevent, such as fraud and, more recently, skyrocketing CO_2 emissions. It’s almost as if the FED isn’t a shady private institutions owned by the Rothschild’s out to exploit the common man.

I’d love to learn more about governments’ “benign curiosity” toward early crypto. What form did that take, exactly?

They didn't ban it

That’s a somewhat different idea from what you wrote above. You’re essentially saying early adopters’ paranoia was unjustified until it wasn’t.

That's not the same person as above

I don't think there's a powerful cartel controlling the industry. If you'd imagine that, they would be controlling the market, not the industry per se, it's production..

Anyhow, most industries are controlled by few players outside of crypto. Perhaps the right question would be if the existence of crypto as a new component of the system can somehow decrease injustice in the system as a whole. I don't know the answer, but I would gamble it's No - for now. The way I see it in the near future (maximum 10y) we'll get obvious reasons to answer Yes, though.

The leftists critique of states stretches back to the origins of leftist philosophy; it’s not a newfangled thing.

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