Hacker News Reader

Comment by JonathanBeuys | Hacker News Reader

    industry regulations really
    defeat most of the benefits
    and points of the
    decentralization

How so? Bitcoin's use cases seem unaffected:

1: Hold something that is expected to stay scarce and not printed or mined to infinity

2: Make international, fast and cheap payments that are instantly finalized.

View on HN

You seem to have jumped my second sentence:

> The problem in reality would be non existent if people used crypto currencies for what they were meant to be used for

Which is more or less what you're pointing at.

Most regulations around securities involve disclosures as in over some percent threshold the entity owning that security must disclose their ownership and report on it every quarter to the SEC.

Disclosure of ownership in crypto really should be around a dollar threshold, not percentage and that mostly defeats the purpose of anonymity. I think financial institutions (banks, exchanges, wall st.) should have to disclose holdings in crypto for both crypto trader awareness but also for their customers in other business sectors awareness.

There should also be strict rules preventing operating an exchange/market maker and any sort of investment firm (hedge fund, etc.) by any degrees of separation. That means they can have no relationships at all organizationally (parent/grandparent company owns both type of thing). Any transactions between exchanges and funds of that sort should 100% be reported and tracked. I think it can be anonymously tracked for some period of time but must be disclosed to an independent regulating organization.

Bitcoin is not a security though. Both the CFTC and SEC have said so publicly:

https://bitcoinist.com/cftc-chair-only-bitcoin-is-a-commodit...

https://decrypt.co/103926/sec-chair-gensler-bitcoin-not-secu...

maybe it should be?

on SoFi for example the UI/UX for trading stocks and ETFs is the same flow for trading crypto and people trade it like it is one. Else, why hodl at all if it's not in hopes it'll go up in value?

1: How do you easily get bigger amounts of crypto, without a centralized exchange?

2: How does the receiving person use the received bitcoins, unless there is a real economy or again a centralized exchange?

Who said anything about not having a centralized exchange? Centralized on ramps are not necessarily antithetical to a decentralized system.

This argument kills me all the time.

Like, yes, when I take my kids to Chuck E. Cheese I do want to convert my money into the tokens. I do not want to store them as that.

In this specific argument, it was about regulations, which such centralized exchanges would need to comply with.

Generally, it's literally the whole basic premise of everything 'crypto'!

I’m sorry, but yes they are… the security of the system was supposed to be built in, and it was supposed to have its value built in. Neither are true. It’s not decentralized and at this rate it never will be, and seeing how it turned out so far, it would be a good thing to fail.

> A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution

> We have proposed a system for electronic transactions without relying on trust.

Any regulation introduces a 3rd party which Bitcoin was designed to remove.

When it comes to money, a purely peer to peer system of payment is just not possible unless you are doing barter. Even when you use cash, you are using the cash issued by a third party that both the payer and the receiver trust to have value. Whoever wrote the Bitcoin whitepaper was definitely a brilliant programmer but had no idea about human psychology and economics. Trust is the most important factor in economic transactions. In a complex world like ours third parties like government, banks, exchanges provide the trust.

You cannot outsource the trust to code. Code is not law. You cannot solve all problems with code.

I tend to agree with you.

Yeah ok but the first use case kind of doesn't work. The "nanny" state raises interest rates a tiny bit and suddenly nobody cares about the scarcity of Bitcoin. What gives?

Reply on news.ycombinator.com