> it does solve a real problem - verifying transactions independently
Yeah, but who actually needs that "problem" solved? Money launderers? Drug dealers? Scam artists? Adolescent boys whacking off to Ayn Rand books in their mother's basement?
Yeah, but who actually needs that "problem" solved? Money launderers? Drug dealers? Scam artists? Adolescent boys whacking off to Ayn Rand books in their mother's basement?
Money laundering, drug dealing, scamming old people, these things have all existed well before cryptocurrency.
Arguing that central banks and a few other non-elected decision makers should be able to influence our lives by devaluing our savings is... insane. It's Stockholm syndrome really.
A few wealthy people decide your money should be worth less because a bunch of other wealthy people have made bad decisions for decades and now there's too much money floating around. Coincidentally, the interest rate adjustments won't tangibly affect the wealthy people! That's not something I want to continue to support.
What’s your solution?
Each medium of wealth storage has tradeoffs, so being categorically opposed to one type because of ideological principles seems suboptimal to me.
For example, fiat may be subject to devaluation, but is stable, widely accepted, highly liquid and (cash) is anonymous.
Bitcoin is subject to speculation, so prices are highly volatile, amongst other downsides.
Land tends to maintain or grow in value, subject to interest rates, tax environment, and adjacent developments, and is very illiquid.
Perhaps, but a currency that devalues based on news, scams, pump & dump schemes, and so forth isn't the solution. Crypto doesn't transfer the power of value to you, it transfers to people with a big enough following - or botnet - to amplify whatever news (false or not) that impacts their crypto the way they want it, up or down.
Your premise is reasonable, but your conclusion doesn't logically follow from it.
This is an accurate characterization of the dollar as well.
A common theme in all the cryptocurrency hate is that crypto enables scams, drug deals, etc. It's value fluctuates because of the decisions of a few bad actors. The dollar and every other central bank currency also have these issues.
The dollar recently peaked around a 9% inflation rate.
The euro peaked around 10%.
I could also make an argument that these numbers are actually understated but that's not the point. These are supposedly stable currencies. A person who has saved up ~100K Euros by January 2022 now only has ~90k Euros in January 2023. That's some pretty significant volatility. Unfortunately, the central bank currency's never go back up in terms of purchasing power. They only go down.
Not in the way you're saying - it's a matter of degree. When Theranos scammed hundreds of millions, the dollar didn't drop in value, nor has that ever happened.
You seem to have unconventional definitions of "stable" and "volatile". Calling a 10% devaluation in 1 year volatile is laughable compared to crypto. For example BTC -65% in 1 month (1/6/18 to 2/6/18) or how about TerraUSD, -80% in less than 1 week, 5/9-5/14/22.
Fiat and crypto aren't even in the same galaxy when it comes to volatility.
And? Is it even coming close to the volatility of the most popular coins?
> Unfortunately, the central bank currency's never go back up in terms of purchasing power. They only go down.
With good reason! Deflation is one of the greatest worries in any economy.
It's the same reason why free-as-in-anarchy speech social networks become far right cesspools [1], you have little reason to switch unless you're someone who's been kicked off the major platforms.
[1] I really don't mean to pick on the right wing nutjobs, it's just that the "far left" doesn't exist in the US so you don't find groups pushing for violent worker uprisings, seizing control of industry, and significant wealth redistribution, I'm sure they would split off the mainstream too.
Plus while a bank may devalue its currency, the point of it is to keep it stable -- something we haven't seen from crypto in any meaningful sense. Even the so-called "stable coins" are anything but.
There's plenty of people out there who disagree with central bank's existence and policy. I don't know if I'd call a currency "stable" when it's lost 80% of it's own value since being introduced and can have new liquidity created with little due process. All currency is an illusion, it's just about which illusion makes you more comfortable.
It's all just money, and money isn't entirely rational to begin with.
Something that depreciates can still be stable. The US dollar loses value at a relatively predictable rate. We can see what an unstable currency looks like right now by looking at Argentina, where the peso has lost 47% of its value in a year.
BitCoin is more like the peso than the dollar, hence why its called unstable.
> All currency is an illusion, it's just about which illusion makes you more comfortable.
Currency isn't an illusion, it's a social construct, and its a deeply embedded social construct.
By that logic, Earth is tilting dangerously out of control and the moon is hurtling off into deep space.
This is exactly the issue that a lot of people have with them. Not to mention that the people in charge of adjusting the value of your life savings aren't even voted in...
Cryptocurrency aims to give you complete autonomy over your money. Something 99.99% of people don't currently have.
That sounds nice, but it doesn’t come for free. Price volatility, trust issues, etc. to name a few.
I think a key issue is that credit, money, wealth, currency, while related, are really different things but for many people all of it is “money”.
These are not specific to cryptocurrency. The trust issues are primarily a result of crypto scams and not innate to crypto. Just as scams involving dollars, euros etc., have nothing to do with the currency itself.
Where crypto shines on the trust aspect is that you don't have some guy in an ivory tower deciding to devalue your crypto by 5%/year. You can choose to buy into inflationary cryptos (doge coin for instance), or you can choose to buy into crypto's with fixed supply. No one can take your share of the supply away from you or change the rules on a whim. That's absolutely huge.
"Compound interest is the most powerful force in the universe" - Albert Einstein, supposedly. Central banks use that force against citizens and everyone just accepts it because it's been that way for so long.
> There’s a reason we have target rates
In an interview Powell admitted no one really knows why the target is 2%. Why is 2% better than 10%, why not 0%? We don't need to encourage consumption with artificial money devaluation, humans already discount the future because of the finiteness of our lives
Who needs freedom of association except for troublemakers?
Who needs the fourth amendment except for criminals?
Crypto solves (to a degree) the problem of a huge amoount of power belonging to the few people who run the financial system. Huge consentration of power is not a good thing. Power corrupts and so on. Crypto puts everyone on equal footing - rather than say the people/companies who have a banking license enjoying an unfair advantage over everyone else (like the power to create money from thin air in the fractional reserve system).
The credit card companies, PayPal and the like get to decide which companies are worthy to exist and which not. If they don't like a business, they can just cut them off from receiving money. E.g. VPN provides who don't keep logs are all banned from receiving credit/debit card payment, PayPal, etc. - they have to resort to receiving cash by post and crypto.
US: https://www.sec.gov/spotlight/cybersecurity-enforcement-acti...
CA: https://www.osfi-bsif.gc.ca/Eng/osfi-bsif/med/Pages/20221116...
EU: https://www.bafin.de/EN/Aufsicht/FinTech/Geschaeftsmodelle/D...
and so on.
I hope that even if you love the current financial system, you'd still be in favor of giving its competitors a chance to exist.
In abstract terms, independant trade without ties to a dominant financial gorilla (once a time the pound sterling and perhaps one day the Yen (or other)).
That was a clean enough goal from the outset, my personal objections (expressed in cypher forums back in the day circa the bitcoin paper dropping) are wrapped in the failure to tie the OG bitcoin to some form of verified "energy used to mine" signature (a curly one) and the high energy cost of verifying OG bitcoin transactions.
With 20/20 hindsight it was likely a premature release, in fairness it was more of a proof of concept begining that lasted longer than expected and then took off.
What currency do you propose people, companies, and countries trade in? And why that currency?
A currency is abstraction for trade in wider circles where (the common case) trade between two parties isn't sufficient ( typically parties supply | demand a basket of various resources, various energies, various intermediate and finished goods ) and for trade to take place the guarantors must have faith in the agreed abstraction for transfer of credit; additional mechanism that verify transactions are an added bonus.
Both now and through history many currencies have been used and are being used.
I've given examples of US dollars, the Pound Sterling, in the context of this sub thread bitcoin is an obvious example of a currency that has been used to facilitate trade; less obvious but important examples of currency are the word of a trusted person of faith (as used historically along the original Silk Road and today throughout Hawala and similar mechnaisms).
What strikes me as odd about your question is the implicit assumption that I favour one singular currency over all others.
So while in theory crypto offers that alternative that should be better than those shitty countries economic policies, in practice, this gave them something worse than their local bank.
Yes Yes, you can use a hardware wallet and would have avoided all of that, the reality is that a very high percentage of people were just using the tools offered to them and didn't think it was all a giant fraud.
Not only that, if you really want to look at exploitation of the poor look no further than our large banks in America.
As I said the current system is better so I don’t see your point as some sort of counterpoint to my observation that crypto has utility, it’s just relatively low or tuned to less in demand needs.
Whether crypto can actually mitigate that is an open question. Arguably, a society that accepts strict financial controls would also prosecute crypto users.
I don't believe for a minute that today's Court would expand that reasoning to digital currencies, but it is a foot in the door.
This applies to both kinds of drugs, by the way. Online black market shops selling generics from India also use crypto heavily.