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Comment by Nextgrid | Hacker News Reader

The only way to beat Bitcoin or other proof-of-work cryptocurrencies is to remove the need for them. Bitcoin and other cryptos have a use-case; it may not be apparent to someone living in a developed country with access to a good banking system or it may be one you don't like and involves criminal activity, but there absolutely is a use-case.

The only way to stop this is if the traditional banking system catches up and covers all these use-cases, including undesirable ones. As the war on drugs proves, prohibition is expensive and doesn't work even for a physical asset, let alone something completely virtual that just needs software and a network connection.

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We know that technological history is full of situations where the inferior technology prevailed for some reason or another. The classic example is Betamax versus VHS.

All that is to say, as much as I’d like to believe it is true, there is some naivety to suggest that a superior solution will simply up end cryptocurrency, when there is a lot of money to be made by a lot of very wealthy people in cryptocurrency.

Or consider: 'there is a lot of money to be made by a lot of very wealthy people' in continuation of the petro-dollar system. Many high-paying white collar defense contractor jobs are wrapped in patriotism and sell munitions to middle east dictators.

Banning maybe wouldn't eradicate it but it would collapse the price and reduce mining.

Then, We should make money laundering, drug trafficking, ransomware, blackmail etc legal?. Banking system is regulated precisely to make illegal activities more difficult. Sooner or later, crypto exchanges will get regulated in the same way as banks. It just takes time for regulators to catch up.

> Banking system is regulated precisely to make illegal activities more difficult.

But at what cost? I'd argue that the costs outweigh the benefits. It hinders competition and innovation, makes it hard or impossible for some people and businesses to access the banking system, increases fees on consumers due to the immense cost of compliance (>$180bn a year worldwide), puts innocent people behind bars ("guilty until proven innocent" is the typical standard with AML), is a privacy nightmare, puts police investigative work into the hands of private sector employees, makes operating globally almost impossible, etc.

Meanwhile, has it really deterred any crime? How about we just go back to catching criminals the good old fashion, with police investigations, for actual crimes, just like we did pre 1989. Hell, use financial data to inform investigations if needed.

> But at what cost? I'd argue that the costs outweigh the benefits. It hinders competition and innovation, makes it hard or impossible for some people and businesses to access the banking system, increases fees on consumers due to the immense cost of compliance (>$180bn a year worldwide), puts innocent people behind bars ("guilty until proven innocent" is the typical standard with AML), is a privacy nightmare, puts police investigative work into the hands of private sector employees, makes operating globally almost impossible, et

Benefit greatly outweigh cost. You can put your credit card details in random website, and it is relatively secure. When someone steals your card, you can get bank refund or do chargeback. For most consumer, making online payment is free of charges. You have sophisticated security, limits, monitoring, fraud detection and when bank is hacked or defaulted your money have government guarantee. My bank would ask me for additional authentication when making bigger payments, and even once blocked a transfer I made because it was a scam.

Meanwhile, in crypto world:

When your exchange is hacked (Mt. Gox) you lose everything. When someone steals your wallet you lose everything. You need to figure perfect personal security or you will get hacked and lose everything. Payments are slow, expensive and nobody protects you against scammers.

> Meanwhile, has it really deterred any crime? How about we just go back to catching criminals the good old fashion, with police investigations, for actual crimes, just like we did pre 1989. Hell, use financial data to inform investigations if needed.

Financial data is provided by banks as part of this regulation. Most of the cash transactions and trades in stock market are reported to multiple organizations that use that data to prevent/fight financial crime. This regulation make hard to create bank account for illegal activities because banks are liable for this[1].

[1]https://www.wsj.com/articles/hsbc-fined-85-million-for-lax-a...

All of that is great but it has nothing to do with AML/KYC regulations.

AML/KYC are absolutely part of the reason banking system is so safe and why criminals use crypto instead.

Care to share your evidence for the first paragraph?

The best evidence is the price surely.

The fact that people trade in it isn't enough evidence?

There's none.

It's mind boggling that 12 years later, people like the parent poster are still claiming bullshit like that when there's literally zero evidence, rather the opposite. No country with underdeveloped banking and payment systems is interested in something like Bitcoin. They need something cheap and efficient, federated and... centralized! Many African countries are perfectly fine using M-Pesa.

There are a lot of countries where people need anything but centralised money. Because they have every reason not to trust the ones who would run the central authority.

It's hard for some first-world country citizens to imagine that.

Political problems don't have technological solutions.

Telling these people to use Bitcoin is just giving their government another tool to send them to jail.

Any arguments against bitcoin are shattered by one simple fact: currently bitcoin is the least risky and simultaneously the easiest way for russian citizens to fund anti-Putin opposition. Any first world do-gooder who wants to ban it because 'it is bad for environment' should first ban himself from existence because humans are bad for environment.

Seeing how well the ransomware industry is faring, it seems Putin doesn't feel too threatened yet.

But what happens when he bans all exchanges that off-board cryptocurrencies to Ruble? Will the opposition be happy with tokens that are suddenly useless for day-to-day expenses?

The exchange I'm using is already banned. Didn't stop anyone.

The real threat is police baiting users of such exchanges into sending or receiving funds. But we're yet to see such activity from them.

You haven't seen such activity yet because they don't think you're worth the trouble. If you ever are, it will change, and the exchange will become useless.

Nigerians beg to differ: https://www.theguardian.com/technology/2021/jul/31/out-of-co...

Interesting article. Thanks for sharing.

I'm a crypto hater as much as one can be, but there are many countries in Asia and S.America where locals may not want to stick to local currency due to sky high inflation, and getting foreign currency is not easy or illegal, and/or making international transfer is not possible or expensive.

Which is a political problem and has nothing to do with their banking systems. These people don't want to use Bitcoin, like they didn't want to use USD or EUR before.

And using Bitcoin as a workaround against authoritarian governments sounds pretty risky to me. Everything leaves a trace on the blockchain and it's fairly easy to control (and ban) conversion to/from fiat currency. Going back to peer-to-peer barter is something, I guess, but I don't think we should celebrate that.

> literally zero evidence

to think like this is mind boggling, try to relax, do some research (no, not reading news or opinion articles), and you will find your evidence

also: if smarter people than you are mostly pro-something, perhaps there is something else to it, stop thinking like a 5 year old trying to save the world from some made up monster no one else can see

How do you legalize money laundering?

You can have money laundered or you can have money laundered and the environment destroyed as a byproduct of an intentionally wasteful proof-of-work system. Pick the least worst option?

I lol’d. thank you for this

Prosecute only for the real crime, not for sending money? It was like that in the past.

Make people happy enough to not money launder in the first place?

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