JPMorgan's Dimon blasts Bitcoin as 'worthless', due for regulation
reuters.com
reuters.com
I know very little about the subject, but my initial thoughts lead to things like ransonware payments, money laundering, etc. Certainly there are other useful ways that people regularly use cryptocurrency. What are they?
El Salvador is experimenting.
Alternative form of payment on some sites (haven’t needed it yet)
Also, I didn’t comment on whether the experiment is ethical. Crypto and morality is a whole can of worms that I find hard to understand in a satisfactory manner due to the high stakes of different groups abd they all seem to have a point.
Right?
Though it's not a very satisfying use case because it's like "hold bitcoin because we all agree we should hold bitcoin"
I felt like games/fantasy sports/betting would have come online by now. But, actually using crypto to buy anything is usually a convoluted process.
For betting and fantasy sports, you have better options. Most the games are still fumbling around/obvious vaporware. Your best bet is probably Axie Infinity, and it's not very fun, and also hard to play for free. Also, 80% of the people playing these games are using them for income streams, so they get min-maxed to hell, and there is even more botting than usual.
All of these altcoins, even bitcoin to a degree, are all barely usable unless you're letting them sit on an exchange somewhere.
I've had a good experience purchasing a good or service with exactly one altcoin.
Even all the DeFi stuff you hear about in articles/podcasts is too complicated, or you're going to have to pay $500 in gas fees to do anything.
It's pretty obvious most of the people who are "into" crypto, aren't really doing anything with it besides honing their investment skills once you actually talk to them about what they do with it.
The other games I've tried (Gods Unchained, Axie Infinity, MyCryptoHeroes, Splinterlands, Sorare) are either too expensive or not fun.
Augur (prediction market) is pretty interesting, but it's off limits in my region. It's also Ethereum based, so high transaction fees.
I've also bought a few pizzas, gift cards, domains, supplements, VPN access, that sort of thing as well. I still check for a crypto option at most places I shop (including SaaS services), but I don't see it most of the time.
The way to think about it is that crypto is reinventing all of the historical aspects and nuances both of money and also of public systems of record- both of which are millenia old- on a much faster timeline.
There are orders of magnitude more people alive and participating in this money/ledger maturation process than all the previous times put together, of course. Much of the learning is just being implemented, rather than discovered. (Many of the mistakes, however, are being rediscovered.) So it is going very fast, but there is still a LOT to cover.
I would posit the system of record use cases are much more profound than the money use cases. Those are still years away- we don't really know how far- but it appears to me the infrastructure is still on track to have a role there.
In response to a question- in X years will there be jurisdictions using public blockchains for, eg Real Property ledger, rather than the mix of paper and digital non-blockchain systems variously in use now- I would say yes, and put greater than 50% odds that X is less than 10.
Real Property ledger is much more important than money. You can use any old thing for money, but in any civilization there is only one Real Property ledger.
The big selling point of blockchain is trustless decentralization. How does decentralization improve a property registry? There's a finite amount of land, most of which has a fairly clear paper trail. The existing paper trail has well established legal credentials that any replacement system would have to re-create.
I guess the vision is that if you had immutable records of changes, it would self-resolve ownership disputes. I suspect the vast majority of such disputes aren't about "did he file deed A or B, and when" and more informal "the property line was only vaguely defined" or "we're trying to understand a will written in 1855 without context" situations that may not resolve to a document, and probably require a judge, not an algorithm, to decide.
In a general sense-- supply chain tracking, ownership tracking-- there's usually a single or small cluster of of "end consumers" of the data being stored. For supply chain integrity, it's the end consumer/manufacturer who needs to be able to produce a report saying his cocoa is Fair Trade Certifiable. For land ownership, it's the local taxation and legal system who needs to know who to send the bills to. They become the obvious steward of a centralized record system.
A centralized system also allows for sensible gatekeeping to prevent misuse of the system. I can imagine a blockchain land registry letting people develop a software package to play Monopoly with real land, while a traditional centralized county recorder would probably start penalizing you for filing frivolous documents before you got to the green properties.
Not only illiquid, but mispurposed. Only a portion of the individual assets have humans living in them, many are really just holdings, suitable for Monopoly.
There are plenty of structures that convey portions of real property legal rights in more or less efficient ways, but overall I don't see how it isn't inevitable for value to flow to those mechanisms that enable more liquid and efficient trading, and those mechanisms I think are most likely blockchain based.
It will take a long time, to be sure, and all kinds of new law has to be developed, new kinds of disputes (rhyming with old disputes but in this new medium) have to be subjected to governance and resolution.
But assuming an increase in human movement, climate-driven property value change, nation-state resource volatility, will there be a jurisdiction that adopts an on-chain registry in the next n years? I think so.
Is it better? Does it align with the needs of many stakeholders in the current registry systems? Likely not. But seems still like it will happen.
Real property is fairly hostile to commodification-- even if you have "100 square metres of grade-XYZ commercial space", the guy with a different hundred metres can say that his averages 4 minutes closer to where your workers live.
It might be viable in some level of the market-- perhaps large commercial property owners disinterestedly trading bundles of bulk assets in between themselves-- but even there the time for the transaction to settle is secondary behind things like 'arranging funding', 'inspections', or 'finding a suitable property for needs.'
I talked to a person that valuates art. When I heard her talk, I felt that cryptocurrency valuation had a lot in common with it.
Where art is valued on:
- Rarity
- Popularity of artist
- Perceived craftsmanship then
- Perceived craftmanship now
- Emotional elicitation (indirectly, i.e. if we didn’t “like” or “felt” something through art it wouldn’t hold value, probably).
Now cryptocurrencies:
- Rarity
- Popularity
- Innovativeness of idea at the time
- Innovativeness of idea now
- The ideology that a certain coin or cryptocurrencies as a whole represent (e.g. if it didn’t have an anarchistic and innovative bend then it would be worth a lot less)
- To a small extent: its utility (e.g. the unbanked using it)
Obviously I am handwaving and simplifying. My point: they are more similar than you think.
Things like:
What is trust?
Should we put our trust in technology instead of people?
Can we build a blockchain vm?
Can you censor blockchain technology? Or will people find ways around it?
Bitcoin will always hold some lower bound value, because there will always be 2.1 million willing to use $10 to see what happens.
Governments aren’t playful, people are. Playfulness can lead to recklessness and pain. It can also lead to artistic expression and innovation. IMO with cryptocurrencies, you see both.
As a matter of fact, lots of regulations are on the way, and some countries go further even try to criminalize them, which will accelerate the decline for sure. Myself actually tried to speculate BTC in late 2008 or early 2009 which I cannot remember exactly, as I was pretty sure people were going to speculate in it. It was shame that I was too early, the price was super low ($0.001 or might be $0.01) but there was no venue for me to buy any. The next time BTC returned to my sight was around 2017, the price went up to $1000. I chilled out thought those people were crazy. But it turned out they were actually much crazier than I speculated. I look forward to seeing how this drama is going to end.
https://www.reddit.com/r/CryptoCurrency/comments/9t140h/jami...
https://finance.yahoo.com/news/jamie-dimons-own-bank-cryptoc...
https://www.businessinsider.com/jpmorgan-financial-advisors-...
Here are a couple sources if you are curious:
- https://www.rollingstone.com/politics/politics-news/the-9-bi...
- https://thedailybanter.com/2015/06/jp-morgan-ceo-who-stole-b...
"A comparatively simple crime-economic model, constructed from readily available international databases, closely predicts a range of such expert assessments, and appears to offer a framework for determining and monitoring the size of money laundering flows around the world. Further research is required to complete the model, but the nature of that research is made clear, and it appears that existing data sources are likely to be adequate.
Initial output from the model suggests a global money laundering total of $2.85 trillion per year, heavily concentrated in Europe and North America."
http://www.johnwalkercrimetrendsanalysis.com.au/ML%20method....
https://www.corporatecomplianceinsights.com/banks-15b-in-fin...
https://www.marketwatch.com/amp/story/banks-have-been-fined-...
We rarely get effective regulation — most often, it's simply hoops to jump through that new entrants and smaller competitors will be unevenly burdened by the resource cost of complying.
Barriers to entry. Facebook wants social media network regulations, and Amazon (now!, very rich) wants taxes on online purchases — and now cannabis.
The 'negative news on bull run, positive news on crash' legend seems strong.
Wouldn't things have been better for the middle class if the real estate industry was more heavily regulated in 2008?
It's already very , very heavily regulated. I remember in 2010 trading on etrade or ameritrade was a simple as filling out the form and wiring money, but with cryptooo there are tons of security checks, ID checks, verification, screening, blaocchain analysis to do anything.
Most of the stuff you list is simple stuff done to meet KYC rules that most exchanges were initially delinquent in implementing and only did so when it was pointed out the obvious liability they were taking on not implementing them.
For regulated securities products there are all sort of approvals needed from the product itself to the marketing materials. There are rules about suitability of the product, transparency over commissions and fees, licensing and registration of market participants, market data rules.
That’s all just the tip of the iceberg.
>Most of the stuff you list is simple stuff done to meet KYC rules that most exchanges were initially delinquent in implementing and only did so when it was pointed out the obvious liability they were taking on not implementing them.
That is my point. they were. not anymore.
My interpretation is that bitcoin is not "for the man", and therefor "the man" will not like or want it. But "the man" would trade in gilded gizzards if that would make them money.
What am I missing?
But more to the point, what would stop JPMorgan from getting in on the game if there was money to be made?
Long-term, it is in TradFi's best interested to oppose the emergence of DeFi. I predict they will use common and tired arguments to push for strong government regulations similar to those on TradFi, to encumber it and add to their own value-prop.
Also, some smart contracts can and will implode on occasion and that is fine. DeFi returns power (and responsibility) to the users, but as they are not used to having this level of responsibility there are bound to be losses here and there due to technical incompetence.
Permissionless public-ledger cryptocurrencies cut out the priviledged middlemen.
You gotta pay to get your transaction executed, the miners take that.
Right now transactions are heavily subsidized by the mining reward, at some point there will no longer be a mining reward so the whole thing will be only supported by transaction fees, and they are likely to be spectacular, even today with the low transaction volumes, actual transactions can sit in the mempool for quite some time before getting executed unless you pony up fees.
Heck it it were Goldman or JP Morgan running it, you have the CEOs dragged in front of congress being asked why they are robbing poor old grandma while she’s just trying to say trade cryptos
If there's really value in bitcoin and it becomes a thing, JPM will figure out how to help. Why? Because they are good at what they do, they have tons of clients and relationships. They add real tangible value to their clients. If middleman means "tangible value" then yeah, they're a middleman. JPM figured it out with currency markets, stock markets, bond markets, commodity markets, credit markets, equity derivatives - they figured it out with big institutional clients, with retail clients - they figured it out in simple products (buy EURUSD) and complex products (buy a 5 year forward knock out call option on EURUSD, contingent on SPX, quanto into Yen). I'm sure they'll figure it out for digital assets - if it truly becomes a market worth entering.
In the meantime, crypto has yet to add any real world value. What sane person takes a vacation to Tokyo and does anything other than use their Chase-issued Visa card (now available on your iPhone!) to buy stuff? Are you going to go there and pay with your bitcoin? Ridiculous. And guess what, the credit card route works instantly and it costs nearly nothing.
Where are the real use cases for crypto? Digital gold? Maybe. Weird trading card things, ok maybe. But real ones? Maybe they will come, but also maybe not... When internet/BBS came out to real people in the mid 1980s, even then (even then!), it was obvious that this was huge and had real value. People communicated, played games, etc. In the 1950s, business used computer to automate processes. We didn't need to wait until 1995 to figure out the internet (or computers) would eventually be huge. But with crypto, 10 years later, and nobody who actually understands traditional finance can articulate where crypto is better/faster/easier/cheaper, or any other use case. Maybe it will come, but I haven't heard it!
Politicians and bankers (almost all on the older side) have no clue what they're talking about when it comes to technology, and come to terrible conclusions all the time.