Then you are misunderstanding the basis of Bitcoin, and thus the blockchain architecture.

If you didn't care about the government, then why not just use a plain old bank? Without the ability to evade government subpoenas, what actual added value does Bitcoin have? What can it do that other means of transfer cannot do? Trillions of dollars in payments go across borders every single day. This is not something that is unique to Bitcoin.



Well, it looks like Bitcoin is no longer decentralized because almost all of its holders use it through a broker or an app, and with chain analysis it's not very "censorship-resistant" either, and they are being cracked down on.

To be clear, Bitcoin is absolutely, positively going to "survive". Nobody is questioning that. The only thing to question is whether it's going to stay in the hearts and minds of millions of consumers such that it's market cap remains over one trillion US dollars.

And the other question is whether other digital currencies, which are not based on blockchain and not decentralized, will become more popular among millions of people than Bitcoin is today.

Personally I think the products that are built for a mainstream audience tend to win out in the marketplace in the long run .

Bitcoin, i.e. the blockchain architecture, i.e. decentralization was invented to solve one problem, which was to provide a means of value transfer for parties who could not safely use an ordinary bank.

Only a tiny, tiny fraction of people have this problem. The rest, who do not wish to oppose their own government (either out of honesty, loyalty, or out of fear of prosecution) don't have any need for a system that makes it impossible for a government to subpoena their transactions.

Hence almost all users of Bitcoin and other cryptocurrencies today use it in a way that is not decentralized, e.g. through an app or a broker.

Bitcoin today is, in actual practical reality, just a meme investment.

The digital currencies of the future will use centralized architectures that scale correctly to handle consumer demand. We will one day look back at the whole "p2p" and "decentralization" thing as yet another technology fad like so many before it.

This is called believing everything the right-wing media feeds you on a daily basis...

"They" don't hate Bitcoin. They hate countries who use Bitcoin to skirt international sanctions.

You are mixing up the three uses of a currency:

1. As an investment instrument.

2. As a means of performing a transaction.

3. As a means of measurement.

Those things are independent of each other. US dollars are used as all three right now, but I suspect #'s 1 & 3 will decline over time. I don't see the world getting rid of usage #3 though. The most important thing about Bitcoin today is it's value in US dollars. That's way everybody thinks of it. If I asked somebody how much something costs, and they replied "42.5 quatloos", virtually everybody would immediately translate that to US dollars in order to understand how much value that was. They can figure out how much of their savings this item would require, or how much work they would need to perform in order to earn it. The world needs this regardless of what happens to the US dollar itself in the other categories.



The US doesn't have a CBDC, and I suspect that project will never get off the ground. Non-government digital currencies will probably make CBDCs a moot point, I suspect.

As for the difference between a digital currency and PayPal/credit cards/banks:

1. A digital currency can provide anonymous transfer, e.g. like physical cash (there are technical problems with things like Bitcoin for this because of chain analysis, but other digital currencies solve this problem in other ways, starting with simply legally promising to not divulge your privacy for any reason barring a government subpoena, e.g. like VPN providers work).

2. A good digital currency (I'm really trying to do this without self-referencing here ) will have an extremely low transaction fee. Say, $0.005 for instance.

3. A good digital currency will be extremely fast, on the order of 10ms per transaction, which is ~500x faster than today's credit cards and PayPal et. al.

4. A good digital currency will be suitable for high-scale realms like games, wherein they could use "real" external currency instead of internal currency because the transactions would be fast enough to keep up.

So yeah, I think "good digital currencies" are the wave of the future and will replace most of today's physical cash transactions and many of today's credit card transactions as well.

Bitcoin is no longer "censorship resistant", by which we mean something that can be safely used by those breaking the laws of their government. It hasn't been for years. (No Bitcoin user values "permissionless" and they don't know what that means or care).

You can see what most consumers want by observing that almost all Bitcoin user use centralized wallets, which are no different than bank accounts.


I never said that BTC can be stopped by the government--no world government wants to do that because there would be no point.

When I say "blockchain" here, I mean the blockchain architecture and I mean it's use in new projects going forward. There's no reason to use blockchain to create the next Bitcoin.

Yes, Russia is a major trading partner with Iran, along with a bunch of other countries who stand along side them in wanting to eliminate the United States.

Remember these economic sanctions are something we do in lieu of physical war. If we didn't have this tool, a lot more people would die.



I've been asking this question here for several months now, and it's a very important topic.

The fact is that Bitcoin has failed at censorship resistance, and things like chain analysis and plain old financial regulations easily kill that.

The only reason Bitcoin is still around is because only about 1% of Bitcoin's users care about "censorship resistance" and the rest care about their investment increasing in value and nothing else.

Bitcoin works just fine as a meme investment, and that, defacto, is all it is anymore.

And this is true for all blockchain-based currencies and NFTs. Blockchain is a waste of time and resources, since you can accomplish this goal with a centralized architecture far better.

Yes, and the reason you need p2p cash--or p2p anything, for that matter--is to evade government subpoenas. If you don't need that, centralized architectures are far more efficient, secure and convenient.

Bitcoin's original purpose was to create a method of transacting that could not be traced by governments, and could not be stopped by them.



No, what I meant was that governments are getting good at cracking down on "absolutely anonymous" transactions that the government cannot trace. It's clear that kind of "privacy" (as opposed to privacy from criminals and marketers and other citizens) is going to be much harder to obtain, and will probably be reduced to very small networks and very obscure coins--which will necessarily be very risky since they will be such so small. This could effectively kill the entire ability of people to transact in a way that cannot be traced.

But yet the only reason to use blockchain in the first place is to create these kinds of transactions. So why use it?

I guess you can "imagine" absolutely anything, but the clear pattern since money laundering laws were first put on the books in the early 1970s is to go after criminals who cannot account for large amounts of money legally.

The US at least, millions of Americans are paid every day for their work in untraceable physical cash, and there are no laws against it all of these years later. The only time the authorities get involved is when it is a lot of money where it's clear the money wasn't obtained legally.

Identities per se are not on the blockchain, but chainanalysis allows people to "triangulate" where a transaction came from, or where it went. It's not exact, but I'm pretty sure it works well enough to make it so that criminals no longer use Bitcoin, or if they do, they use a mixer.

And while authorities won't go out of their way to track you down unless they have a reason to do so, criminals and marketers will use it to try to steal or sell something, or otherwise bother you . In this context, using Bitcoin these days isn't very safe...

Exchanges that were complying with the law have not been "attacked". Binance broke some specific laws, and was charged accordingly.

It's perfectly legal to hold and trade Bitcoin in the United States. It's perfectly legal to have an exchange for USD or other negotiable currencies as long as KYC and other rules are followed.

The world is not out to get you .



It's implied in the entire paper. It's the entire reason Bitcoin even exists. Otherwise, why not just use a credit card or a bank?

What the whitepaper did not anticipate is chain analysis which makes Bitcoin actually very very unprivate . That's why follow-on products like mixers and Monera came about.



Using blockchain centrally is a complete waste of time and the dumbest thing ever. It's basically adding some code to a project that doesn't need it, and makes the project more expensive, slower, less secure, and more cumbersome to use. It would be like using an HTTPS/REST network layer to add two numbers together instead of just writing "a += b;". I mean, it's theoretically possible, but the only reason you'd do it would be to impress your boss that your project has some catchy buzzwords in it (and a good development manager would tell you to stop that and just get the project done ).

It's still legal to hold and trade Bitcoin in China. All they have done is precluded their banks from holding Bitcoin on their balance sheets.

China still contains a sizable percentage of worldwide Bitcoin mining, so it is by no means "banned" there.

And even if China hated Bitcoin, that doesn't mean they wouldn't attempt to take it over.

Blockchains work "fine", I agree. And as I wrote above, I don't see anything about them changing in the short term.

But long term, the entire reason you resort to the blockchain architecture is to make the system resistant to government subpoenas. If you didn't want that benefit, a centralized system is far better in every single way.

And here I am just talking about the backend architecture, not digital currency trading in general, which I very much am banking on--personally--to remain a very big part of consumer life . You can absolutely have everything most consumers want out of cryptocurrencies without blockchain, but cheaper and faster and better.

So in the long run, if blockchain is just a useless addition to a product that makes it slower and more expensive, then that technology will eventually fall by the wayside.

Iran, and the crackdown on Iran's Bitcoin trading, is in fact demonstrating the opposite: governments ultimately control what people do, and how they transact. The only way to fight a democratically elected government is to vote. The only way to fight a dictatorship is to overthrow them. Us techies don't like to hear this because we work hard to create easy solutions to hard problems, but this is the reality with governments.

Biden is not "pro-abortion", he's pro-choice, meaning he wishes for Americans to make up their own minds about whether they want to have an abortion or not. Biden is proposing that laws banning abortion in various states and nationwide be repealed. If a government repeals a law banning cryptocurrency trading, that doesn't make them "pro-crypto", it just means they think people should be allowed to decide for themselves.

Donald Trump lied. We know that because he is also endorsing the 2025 Project, which calls for abortion prohibition in all 50 states, and equates abortion to cold-blooded murder. We know that because his previous administration did everything they could to restrict abortion under the laws at that time, and then Trump appointed three Republican justices to the Supreme Court in order to allow complete abortion bans nationwide.

People who say abortion is "murder" do not want exceptions for rape because that is just mitigating a crime with another crime. That is why there are already many US states with absolute bans, and Trump has endorsed those bans by dropping his opposition to them (he originally called the Florida law "horrible" and now fully supports it).

If you want abortion to be illegal in all 50 US states, then vote Republican. If you don't want that, then vote Democrat.

It would appear, based on the news this week, that major world governments like the US and others are cracking down on the notion of "government-proof privacy", and prosecuting companies and individuals who facilitate money transfer that cannot be potentially traced by a government. They are going after mixers and brokers who do not adequately engage in KYC.

In short, it would seem that governments are trying eliminate the very thing that Bitcoin--and blockchain generally--was originally designed to accomplish.

What does this mean for the long term prospects for cryptocurrencies? Will blockchain survive losing it's original purpose?

My own answer is: "yes", in the short term, and "maybe" for the longer term.

I have written before about different kinds of "privacy" that people might want, and most want privacy from other citizens, from companies, and from criminals: privacy from a targeted investigation from the government is a level that, in my estimation, a "nice to have" for most people, but not a dealbreaker.

Hence in the short term, cryptos missing their original purpose is not something most consumers care about. Most holders of Bitcoin these days do so in a centralized way, e.g. with an app or a broker that keeps their account under their name, in a centralized database.

As for the longer term, this brings up an important question: why use blockchain at all?

Blockchain is slow and expensive to transact in on purpose because of proof-of-work and decentralization. No cryptocurrency will ever come even close to scaling to the billions of transactions each day by people worldwide.

But a digital currency that is not blockchain-based can accomplish this and provide the same mechanism for speculation and value store that blockchain-based currencies provide. In my opinion, the long-term future of the actual blockchain architecture behind today's cryptocurrencies is... unclear.

These actions are not against "bitcoin and crypto", they are clearly against mixers, which they are clearly coming after.

And their concern is money laundering and tax evasion, not people holding and trading crypto, which millions do every day and are under no risk of prosecution.

This is not, repeat not a crackdown on cryptocurrencies.

You can debate whether the government should be cracking down on anonymized services that allow transactions that are impossible to be tracked by a government with a valid subpoena, but that is all they are targeting here.

So repeating the candidates written statement of intentions is "misinformation"?

Pointing out what steps Republicans have already done to try to ban abortion in all 50 states is "misinformation"?

You obviously don't understand how things work in the United States. Republicans have already made abortion illegal in many US states, and stopped all doctors nationwide from using the abortion pill for several weeks while they fought in court.

A majority of Republican voters these days want a 50 state ban on abortion. That's what the polling says. If they win, they will impose their will on the rest of the country through Trump as their agent. That's how democracy works.

They don't now, but they very well may in January of 2025. That's why the Chinese are doing everything they can to get Trump elected.

She's saying that the US should do more mining instead of Iran. Why is that a bad thing? She's certainly not anti-Bitcoin by saying this. In fact, she may will be boosting the US domestic mining industry by saying this.

But I guess that doesn't line up with how Fox News is spinning it? Maybe that's the problem?

This is yet another example of how you can shoot yourself in the foot by getting business advice from... partisans. Republicans just want to win the election in November and are going to say whatever they need to say in order to do that. They don't care about your Bitcoin portfolio.

Bitcoin went up 500% under President Joe Biden. If all you care about is Bitcoin going up in price, vote for Biden and the Democrats.