spartak_t
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September 22, 2016, 08:10:28 AM |
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mar my words. "litecoin will go to the moon in the near future."
the whales have been accumulating and if anybody was left behind or was busy in other places, they have came back to litecoin again. and especially with the current news about the confidential transactions which is the new popular interest, there will be a lot of attention to litecoin and soon there will be a big rise because of all this.
Yeah, right. And what if the scenario with the authorities targeting anon coins become a reality? All of these altcoins are going to rush in hard forks or just die. Guess what happens with the rest who didn't took that way? ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
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bbc.reporter
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September 22, 2016, 08:28:09 AM |
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Yes but using litecoin for crimes will happen anyway, just look at bitcoin. The advantage of having confidential transactions in making each coin fungible and the same. Unlike bitcoin now some people fear that the coins that went thru the darknet market will have less value than the coins that did not.
For me personally I think it is overrated but those people that said that fungibility is important for the future of the coin might be right.
What is needed is cryptocurrencies to be (widely) accepted as money. A lot of people care about their privacy, but they have it (at least they think they do) while using fiat money, right? Cryptocurrencies should focus on being "better money", not a "better way to hide ourselves". You are looking at the situation from the point of view of the authorities. Better money is only better if it gives ordinary people the freedom and the control of their own money without any individual or institution snooping around and trying to stop it. Also I think your fear is caused by thinking that your favorite coin might lose "value" in $ because the said authorities might come after the users of the coin. Let go of that thought.
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spartak_t
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September 22, 2016, 08:43:47 AM |
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Yes but using litecoin for crimes will happen anyway, just look at bitcoin. The advantage of having confidential transactions in making each coin fungible and the same. Unlike bitcoin now some people fear that the coins that went thru the darknet market will have less value than the coins that did not.
For me personally I think it is overrated but those people that said that fungibility is important for the future of the coin might be right.
What is needed is cryptocurrencies to be (widely) accepted as money. A lot of people care about their privacy, but they have it (at least they think they do) while using fiat money, right? Cryptocurrencies should focus on being "better money", not a "better way to hide ourselves". You are looking at the situation from the point of view of the authorities. Better money is only better if it gives ordinary people the freedom and the control of their own money without any individual or institution snooping around and trying to stop it. Also I think your fear is caused by thinking that your favorite coin might lose "value" in $ because the said authorities might come after the users of the coin. Let go of that thought. No. I am trying to foresee how authorities would/may react. How about companies which are transferring money by using cash trucks? "G4S" alone has over 600,000 employees. The blockchain tech could literally kill them and anonymity won't help here. This alone makes cryptocurrencies a better money and its more than enough for them to become widely used. Cryptocurrencies should not necessary replace fiat money. I'm not trying to insult anyone, but I think that no one with their right mind can think that they actually can replace the mighty $ (or euro, GBP - you name it). Some day it may happen, but I think we are not going to be alive and see it. Don't get me wrong, I have no fear. Why do you think I'm using my identity and everything? It can only take you 30 seconds to know who I am. That's because I simply don't care. When you are discussing something, which does not depends on you, then you must always add the masses in the equation. Digital currencies needs to improve their security and scalability issues, nothing more. After that it all depends on how you are market them. Most of the fiat bills are just papers, which matters to some of us. You are just giving a paper in the store and they are giving you good. Who said that this particular bill worth something? A $100 bill worth the paper, ink and the work involved in its creation. Go and give that bill to some Zulu hunter, he won't give you even a gazelle's hoof for it. That's pretty much it. Linux is far superior than Windows OS, but go and compare Linus Torvalds and Gates's net worth.
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dinofelis
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September 22, 2016, 08:45:02 AM |
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What is needed is cryptocurrencies to be (widely) accepted as money.
Why is that needed ? Why do we need cryptocurrencies, and if you have a good reason for that, why would they need to be widely accepted as money ? What good brings crypto, that fiat doesn't have, and is better at it ? A lot of people care about their privacy, but they have it (at least they think they do) while using fiat money, right?
But transparent block chains are WAY WAY WAY less private than fiat.
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spartak_t
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September 22, 2016, 08:52:29 AM |
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But transparent block chains are WAY WAY WAY less private than fiat.
^ This! ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) This is the main argument, which cryptocurrencies have! I already said that If confidential transaction is something optional, then it's ok - no worries. If the states start claiming that is a way for doing crimes, then we can all blame companies which produces weapons for all the killings caused by their "products". It's like "You are producing something, which can kill people.". EDIT: i.e. They don't take responsibility for what happens next. But then again, states are always twisting things so...
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dinofelis
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September 22, 2016, 08:58:14 AM |
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But transparent block chains are WAY WAY WAY less private than fiat.
^ This! ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) This is the main argument, which cryptocurrencies have! But who wants that ? Nobody wants transparency for himself. At best, you would like to have transparency for TPTB, but you will never get it. So the only thing that remains, is that TPTB will remain just as opaque, but that YOU, simple citizen, will be entirely delivered to total transparency. Who the hell would want such a thing, apart from TPTB ?
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spartak_t
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September 22, 2016, 09:07:53 AM |
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But transparent block chains are WAY WAY WAY less private than fiat.
^ This! ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) This is the main argument, which cryptocurrencies have! But who wants that ? Nobody wants transparency for himself. At best, you would like to have transparency for TPTB, but you will never get it. So the only thing that remains, is that TPTB will remain just as opaque, but that YOU, simple citizen, will be entirely delivered to total transparency. Who the hell would want such a thing, apart from TPTB ? I think that we should simplify things and don't think too deeply. Let's just focus on fungibility. We have, how much? Probably over 150 different fiat currencies, but there are a lot of places where you will not be able to use your $ (or whatever). You are often limited. Serbia for example is not in the EU yet they are accepting EURO in most of their shops and services. Bulgaria is in the EU, but shops and services are generally not accepting euro as a payment. You need to exchange them for BGN. There are lot of different things that may attract people to use some cryptocurrencies. Some cares about its security, others for its speed and there are even people who only cares about the logo. To them is important how you look, no matter if you are the greatest product/mind in the world.
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Spoetnik
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September 22, 2016, 09:37:26 AM |
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So far Altcoins are not being adopted. As a matter of fact many popular coins have lost users since 2013. I have met many people who thought Bitcoin "was a thing" ..in the past. They said oh that drugs & guns digital criminal internet money thing ?
So..
TOPIC.
Is optional "confidential" features going to help or hinder adoption ?
If you think it's going to help you are high on crack /.
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FUD first & ask questions later™
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dinofelis
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September 22, 2016, 09:48:19 AM |
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So far Altcoins are not being adopted.
Bitcoin almost neither. A little bit, such as for VPN, or VPS. That's what I'm using it for. But it is not much.
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dinofelis
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September 22, 2016, 09:53:12 AM |
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I think that we should simplify things and don't think too deeply. Let's just focus on fungibility. We have, how much? Probably over 150 different fiat currencies, but there are a lot of places where you will not be able to use your $ (or whatever). You are often limited. Serbia for example is not in the EU yet they are accepting EURO in most of their shops and services. Bulgaria is in the EU, but shops and services are generally not accepting euro as a payment. You need to exchange them for BGN.
Eh, fungibility doesn't mean that your coin is universally accepted. Fungibility means that if I give you a dollar bill, you don't care WHAT EXACT dollar bill (from the moment it is a "real" one), nor "who held it previously". That if I do a bank transfer of Euros to your account, you do not care exactly "what Euros" (that doesn't even make sense for bank Euros) or "who owned which Euro before me". With bitcoin (and litecoin, and ethereum, and ...) that IS the difficulty: you DO care whether this coin was once on Silk Road, or owned by the DAO hacker, or ... There are lot of different things that may attract people to use some cryptocurrencies. Some cares about its security, others for its speed and there are even people who only cares about the logo. To them is important how you look, no matter if you are the greatest product/mind in the world.
Is that what all this mess is about ? Concerning security and speed, VISA is way, way better. So in the end, people will adopt currencies because of a logo ?
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spartak_t
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September 22, 2016, 10:09:53 AM |
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Eh, fungibility doesn't mean that your coin is universally accepted.
It is exactly (and mainly) that. But cryptocurrencies (as of now) will be always compared with fiat money (i.e. when John is accepting LTC for his services, he will always compute it in USD/EURO/whatever). That if I do a bank transfer of Euros to your account, you do not care exactly "what Euros" (that doesn't even make sense for bank Euros) or "who owned which Euro before me".
Transfer what kind of money? M2 money? With bitcoin (and litecoin, and ethereum, and ...) that IS the difficulty: you DO care whether this coin was once on Silk Road, or owned by the DAO hacker, or ...
Well, yes... this surely could raise some questions if a crime is committed and part of these money are traced to you. Is that what all this mess is about ? Concerning security and speed, VISA is way, way better. So in the end, people will adopt currencies because of a logo ?
Of course not... and somehow - yes. You must always try to foresee how the masses would react to your product. So far Litecoin could depend solely on Charlie Lee's decisions (if he decide to do something, which he thinks is good for Litecoin (but I'm not saying he'll do that)). P.S. Please stop with your VISA examples. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) The future is ahead of us and currently cryptocurrencies needs to increase their user base. If that happens x5 by the end of 2017 it would be a huge success. That would (presumably) give them market cap of $60B, which is still 3-4 times less than the VISA alone. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) EDIT: Ah, and let's focus on the subject of the thread my friend. ![Wink](https://bitcointalk.org/Smileys/default/wink.gif)
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spartak_t
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September 22, 2016, 10:22:21 AM |
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So far Altcoins are not being adopted.
Bitcoin almost neither. A little bit, such as for VPN, or VPS. That's what I'm using it for. But it is not much. Sorry for creating a second post, but I missed that and I think it's fair not to edit my previous comment. This is because of one simple reason: The average Joe does not accept Bitcoin as money. I've said it number of times that I stopped talking with my real friends about cryptocurrencies, but they slowly starts to realize that they are indeed money. Like one of them who is a simple-minded driver (it could be classified as an american hillbilly). He was with me in couple of occasions when I exchanged bitcoins for BGN (the Bulgarian currency) and then asked him: - Do you think that Bitcoin is money now? He is still not convinced. Lee already said it - gimmicks are not that important. Adoption is. This is my "philosophy" too, no matter if SomeNewCoin make a 0.1 ms transaction to Neptune, without aliens to track it. EDIT: https://www.youtube.com/watch?v=NeJpQQt_b8c - so much with the VISA. ![Wink](https://bitcointalk.org/Smileys/default/wink.gif)
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dinofelis
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September 22, 2016, 11:41:45 AM |
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Eh, fungibility doesn't mean that your coin is universally accepted.
It is exactly (and mainly) that. Nope. It means that there is no distinction between the different units of a single monetary asset. That THIS dollar bill, or THAT dollar bill, are equivalent. https://en.wikipedia.org/wiki/FungibilityThat if I do a bank transfer of Euros to your account, you do not care exactly "what Euros" (that doesn't even make sense for bank Euros) or "who owned which Euro before me".
Transfer what kind of money? M2 money? Indeed, that's why I call them "bank Euros", and not central bank Euros (M0/M1). With bitcoin (and litecoin, and ethereum, and ...) that IS the difficulty: you DO care whether this coin was once on Silk Road, or owned by the DAO hacker, or ...
Well, yes... this surely could raise some questions if a crime is committed and part of these money are traced to you. It is not only a matter of crime. You could also have boycotts. Because on a transparent chain, every single coin takes with it its particular history, no coin is indistinguishable from another one, so they are not fungible. Is that what all this mess is about ? Concerning security and speed, VISA is way, way better. So in the end, people will adopt currencies because of a logo ?
Of course not... and somehow - yes. You must always try to foresee how the masses would react to your product. So far Litecoin could depend solely on Charlie Lee's decisions (if he decide to do something, which he thinks is good for Litecoin (but I'm not saying he'll do that)). If the goal of "crypto" is just to sell yet another financial product, then you can do that, but I fail to see the purpose. Of course some can get rich with it, as with every financial product. But I'm not interested in financial products for the sake of having a financial product. I want it to serve a purpose, and I fail to see what it might be, apart from aspiration to freedom and (hence) a form of anarchy. P.S. Please stop with your VISA examples. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) The future is ahead of us and currently cryptocurrencies needs to increase their user base. If that happens x5 by the end of 2017 it would be a huge success. That would (presumably) give them market cap of $60B, which is still 3-4 times less than the VISA alone. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) My question is again: why do cryptocurrencies need to increase their user base ? What GOAL does that serve ? What purpose ? EDIT: Ah, and let's focus on the subject of the thread my friend. ![Wink](https://bitcointalk.org/Smileys/default/wink.gif) That's what I'm doing. I'm trying to explain that the only sensible purpose of crypto is freedom and anarchy, and that in that case, you should of course expect aggression from states, and anonymity is a good thing. It will of course "hinder adoption" but that's not a problem because the only adoption you would lose that way, wouldn't be adoption in the name of liberty and anarchy, and hence not something that is to be looked for. So even if you divide the market cap by 100 by introducing anon, that's still a good thing, because the other 99% you're losing, wasn't having any reason to use crypto, apart ripping one another off in a zero-sum game (in other words, "adoption of a financial product"). To put it otherwise: suppose that crypto is "selling plastic guns", and anon is "making them fire real bullets". Now, as the goal of the plastic guns would be to defend yourself, clearly, making them able to fire real bullets would for sure improve them in what they are made for. The argument "we shouldn't implement anon, because it will be forbidden" is the same argument as "we should not allow the plastic guns to fire real bullets". But then, they miss their reason of existence: to defend yourself. You cannot defend yourself with a gun that cannot shoot real bullets. If we should follow the reasoning "we need our guns to be plastic, and not have them fire real bullets, because we want more adoption of our plastic guns" ; yes, sure, but there's no point in having more adoption of guns that do not allow people to defend themselves. My point is rather: if these guns have to have any purpose, they should be able to fire real bullets. If not, there's no point in selling those plastic guns. So if "making them fire real bullets" divides the market by 100, that's still better, because at least some people can defend themselves, than having much more adoption of a toy gun that serves no purpose apart from making the seller rich.
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dinofelis
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September 22, 2016, 11:50:53 AM |
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This is because of one simple reason: The average Joe does not accept Bitcoin as money.
We don't care about the average Joe. We care about the people wanting to use a free money, to do the trades that they want to do. Lee already said it - gimmicks are not that important. Adoption is.
Adoption only matters if it serves a purpose. Otherwise it is just another thing to rip off people in a zero sum game.
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spartak_t
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September 22, 2016, 11:56:34 AM Last edit: September 22, 2016, 12:14:25 PM by spartak_t |
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Nope. It means that there is no distinction between the different units of a single monetary asset. That THIS dollar bill, or THAT dollar bill, are equivalent.
Forget the wikipedia. Fungibility actually means that there is no distinction between $10 bill and $10 worth of Litecoin. This is the true (and of course, my humble opinion) meaning. I can't agree with you about the "zero-sum" game claim, and I've noticed you used it number of times. It does not generally determine what cryptocurrencies are. Otherwise, we should just rule Forex (or any kind of) trading out and go back to the stone ages. I agree that the cryptoworld is a "field" where there are groups of people (pumpers) reaping off the average Joe and a lot of scammers and I really hate that. These people are saying "Hey, the average Joe is stupid and he is the one to blame if he loses his $5" and they might be right, but personally if I had the chance, I would skull f*ck everyone doing such things. We must be better than this and if someone is naive enough that doesn't mean that you should rip him off. These people have no dignity! EDIT: This is because of one simple reason: The average Joe does not accept Bitcoin as money.
We don't care about the average Joe. We care about the people wanting to use a free money, to do the trades that they want to do. Lee already said it - gimmicks are not that important. Adoption is.
Adoption only matters if it serves a purpose. Otherwise it is just another thing to rip off people in a zero sum game. Oh, wow... Of course we must care about the average Joe. This is why cryptocurrencies must be explained using simplicity. Why so many people fails to understand that? Do you personally care that there are people in Bangladesh which are making a living by fishing? You probably don't even know a single guy from that country yet its population is 170 f*cking million. That is why there are so many discussions about fungibility. So cryptocurrencies to meet different needs. Let's forget for a moment that currently gimmicks in cryptocurrencies are mainly because some people are looking for a way to get rich quick. But we are not 2014 anymore. This will not matter in few years (if cryptocurrencies survive... or at least their idea).
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dinofelis
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September 22, 2016, 12:32:35 PM |
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Nope. It means that there is no distinction between the different units of a single monetary asset. That THIS dollar bill, or THAT dollar bill, are equivalent.
Forget the wikipedia. Fungibility actually means that there is no distinction between $10 bill and $10 worth of Litecoin. This is the true (and of course, my humble opinion) meaning. No, that's not it. Of course there is a difference. Like there is a difference between $300 000 on a bank account, and owning a house worth $300 000. This is a fundamental economic concept: liquidity. I can't agree with you about the "zero-sum" game claim, and I've noticed you used it number of times. It does not generally determine what cryptocurrencies are.
"investing" in crypto is a zero-sum game. USING crypto to exchange goods and services, isn't. "investing" in crypto simply means "trying to buy crypto low, and holding it, to sell it high". Now, I hope you agree with me, that, given that crypto in itself is a monetary asset, and hence of no intrinsic value (you cannot eat it, you cannot fuck it, you cannot enjoy it in any other way but to transact it), and *doesn't finance any means of production*, that it are tokens that do the accountancy of a zero-sum game. At the end of the day, when the cryptocurrency is dead, and worth nothing any more (say, 3 years from now, or 1 million years from now), the only thing that has happened, is that the total value that people put into it, came also out of it. The ONLY thing you do by "investing" in crypto, is to hope that you will be on the side of people who got more out of it, and that must of course be compensated by exactly the same amount other people got LESS out of it than they put in. Zero-sum. It is different if you use crypto as an intermediate store of value between selling goods/services against, say, bitcoin, to use bitcoin somewhat later, to buy other goods and services of ABOUT THE SAME VALUE. Here, crypto had some actual USE, namely to introduce liquidity in an operation that was going to be difficult otherwise. Investing in crypto being a zero sum game, this is NOT COMPARABLE to investing in the stock market. If you invest in the stock market, you permit the buying of capital production goods, that will PRODUCE CONSUMER GOODS, and hence augment economic wealth. Products that can be enjoyed, didn't exist, and now exist because they have been produced. There has been ADDED VALUE. The gains you can make on the stock market are related to this dividend of ADDED VALUE, made possible because you invested in production capital. This is NOT a ZERO SUM game. The stock market takes part of the freshly created added value of newly created products, to reward those that bought the production capital. In a certain way, "everybody can win" on the stock market. There is an influx of fresh value. Not so in crypto. Nothing of value is made because you augment the market cap of a coin by buying and holding it ; contrary to you buying shares in a new company, that will buy production capital with it, making new products, and creating value (in principle). I agree that the cryptoworld is a "field" where there are groups of people (pumpers) reaping off the average Joe and a lot of scammers and I really hate that.
No, the "early bitcoin adopter" A is exactly the same. He didn't contribute ANYTHING with his buying 1000 coins for 10 dollars and hodling. When he sells them for 600 000 dollars, he is ripping off the buyers (B). This 600 000 dollars of worth did flow into bitcoin, to go in the pockets of the early adopter that only put 10 dollars in it, without there having been the slightest bit of value creation by the early adopter. Of course, those putting $600 000 in it, still hope to be early adopters, to rip off those that will pay $ 6000 for a coin. At that moment, these new buyers (C) will pay $ 6 000 000 for those same 1000 coins, and the B guys will pocket $ 5 400 000. In other words, A and B got value for nothing from the C guys: the A guy got $ 600 000, and the B guys got $ 5 400 000 and the C guys put $ 6 000 000 in it. When bitcoin will have lost all value at a still later date (in 3 years, or in 100 years or in 1 million years), A, B and if they got rid of it, C, will all have gotten value for nothing from the last guys. This is "greater fool theory" at its best. These people have no dignity!
But the "early bitcoin investor and hodler" is exactly the same. It is just different time scales. It is nothing else but a "greater fool theory" system. This is totally different if MOST of bitcoin were used as a currency. Then you don't even mind bitcoins to lose value, and you don't want them to gain in value specially: the SERVICE of fluidity is a product that has value in itself, and for which you are willing to offer some value. But the "investing" is nothing else but ripping off the greater fool.
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spartak_t
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September 22, 2016, 12:50:40 PM Last edit: September 22, 2016, 01:24:20 PM by spartak_t |
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There is a difference between holding $300k in a bank account and owning a house worth $300k. First ain't worth shit and second is a property. But that doesn't change the fact that you can't buy that house with your bank account. Simplicity is what matters, lets try not to dig that deeply. The average Joe (I will always use that as example, because it is what cryptos needs in order to get better adoption) doesn't know how a bank is operating. All he cares is to deposit/withdraw/use the money. Cryptocurrencies must stick to that! Why the hell I need to listen/watch countless of hours of explanations on how Bitcoin works? Or Litecoin for that matter? There are "geeks" who are taking care off. I am Joe and I don't care! Currently our discussion is pointless, because I'm not trying to convince you that cryptocurrencies are money. Same applies for fungibility. We both have our own opinions, but here's the thing... our opinion doesn't really matter. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) That's it... I now need to open (and try to repear) a smartphone and a laptop. Then I must do the dishes. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) Cheers, EDIT: Couldn't help it... ![Grin](https://bitcointalk.org/Smileys/default/grin.gif) You don't go to a hillbilly (Joe) to explain 2 hours what is Litecoin. You go to a hillbilly with: - Hey, do you want to buy some beers and watch Nascar with 10% discount? You get 1 cow for free. Then later on, Adam (Joe's friend) asked him what he did: - I had few beers and watched NASCAR with 10% discount using Litecoin. - What is Litecoin? - Uhm.... I don't know. After that it is the LTC's devs responsibility to keep the guy's money safe. And that's the simple truth. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) Majority of the people don't know that the money are just numbers in someone's computer. US M2 money are like a $12 trillion... if not more. It is how countries with less than 600k population has a $3.6 trillion external debt (Luxembourg). That's because over a 150 different banks are operating there. Of course, at the end, Carl in Somalia works for $0.10/hour instead for $1, but that's okay if the top 1% (actually, a lot less) is fine by that. You can't do that with crypto. Not if supply is strictly fixed.
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dinofelis
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![](https://bitcointalk.org/Themes/custom1/images/post/xx.gif) |
September 22, 2016, 01:31:10 PM |
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There is a difference between holding $300k in a bank account and owning a house worth $300k. First ain't worth shit and second is a property. But that doesn't change the fact that you can't buy that house with your bank account. Simplicity is what matters, lets try not to dig that deeply.
Uh. Of course I can buy that house with a bank account. That's how most houses are bought. And no, $ 300 000 in a bank account "ain't worth shit", get real. Of course it is worth a lot. You can buy a lot of goods and services with it. I suppose you're thinking of "if ever the state decides, they can whipe it out". True, but they can also bomb your house. In reality, today, and here, $300 000 on a bank account can buy a lot of valuable stuff. And that's the only thing that measures value, together with the direct usage value of the thing. The average Joe (I will always use that as example, because it is what cryptos needs in order to get better adoption) doesn't know how a bank is operating. All he cares is to deposit/withdraw/use the money. Cryptocurrencies must stick to that! Why the hell I need to listen/watch countless of hours of explanations on how Bitcoin works? Or Litecoin for that matter? There are "geeks" who are taking care off. I am Joe and I don't care!
But my whole question is: why on earth would average Joe want to use crypto, and not his bank account ? What PURPOSE does this crypto serve ? You run around that question, but you never answer it. It seems that your goal is "crypto adoption". But to obtain what ? Currently our discussion is pointless, because I'm not trying to convince you that cryptocurrencies are money. Same applies for fungibility. We both have our own opinions, but here's the thing... our opinion doesn't really matter. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) Fungibility has a very precise definition. You can look up wiki if you want. It is not "acceptability" or "liquidity". These are different concepts. My whole point is that, apart from a ripping-off zero sum game, crypto has ONLY a meaning as a free currency, to do those trades that cannot easily be done with fiat. I can't see any other useful meaning in crypto. That's it... I now need to open (and try to repear) a smartphone and a laptop. Then I must do the dishes. ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif) I have essentially unlimited state-funded resources to waste my time here. Unfair competition, I know ![Smiley](https://bitcointalk.org/Smileys/default/smiley.gif)
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dinofelis
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![](https://bitcointalk.org/Themes/custom1/images/post/xx.gif) |
September 22, 2016, 02:03:00 PM |
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Majority of the people don't know that the money are just numbers in someone's computer. US M2 money are like a $12 trillion... if not more. It is how countries with less than 600k population has a $3.6 trillion external debt (Luxembourg). That's because over a 150 different banks are operating there. Of course, at the end, Carl in Somalia works for $0.10/hour instead for $1, but that's okay if the top 1% (actually, a lot less) is fine by that.
You can't do that with crypto. Not if supply is strictly fixed.
I think you have some misconception about the fiat system, and about "power". Carl in Somalia will always work for $0.1 per hour. With, or without crypto. That's in the nature of power. The Egyptians didn't have sophisticated monetary systems, but Carl did work for peanuts too, and the Pharaoh was rich, and his aristocracy too. This is in the nature of human hierarchical organization. It is not the result of the financial system, but the result of hierarchical power. The financial system, of any nature, ends up serving the purposes of hierarchical power, but the financial system is not the CAUSE of that power, nor of that wealth. It is just one of the means. Strange as it seems, our financial fiat system doesn't work so badly. What makes rich, is not so much the financial system in itself, but rather two classes of unfair property rights: intellectual property rights, and the rights to natural resources. These are the two lever arms that make big fortunes. Think Bill Gates, think oil. Think Virgin, think Monsanto. The evil is in these concepts of ownership: the right to forbid people from thinking and imitating (which is the nature of our species) and punish them if they do, and the right to own part of nature, on which we depend. This is today's lever of power and wealth. It is guaranteed by hierarchical power, itself framed on military violence and propaganda. The villain in the fiat system is the seigniorage. But here, the good old US of A did a master job in handling the world's resources in their currency, and making their currency the "reserve currency" (a totally fake idea that finds its roots in the gold bugs, not understanding the abstract nature of money). Having one's money as a world reserve currency actually means that you're the only one able to buy the world with a printer. That's what the USA did, and their "external debt" is in fact nothing else but the measure of how much they bought the world with reserve paper. As moreover natural resources such as petrol are denominated also in $$, they can also buy up all the resources of the world with a printer. No other issuer of fiat can do this, because the printer would cause inflation. But not if what you print, is stored abroad as "reserve currency". This was an utmost brilliant move after WWII, to buy up the whole world. This is why the US of A will do anything, including bombing the shit out of you, if ever you try to make another currency the world reserve currency. The ironic part is that if you get their bombs on your head, most probably you were the one making them to sell them to them, or you have been giving them other resources to do so. But if you want to see a rather well working fiat system, look at the Euro. It is a private money, owned by a banking consortium, that has been adopted as state money by several EU states. It kills them, because states never had the discipline to do correct bookkeeping. Crypto would not work much in a different way than the Euro. Of course, crypto is not a debt-based system and doesn't have the same elasticity, but grossly, states adopting a crypto would be somewhat similar to the introduction of the Euro in several EU countries: the state loses its privilege to create money. That doesn't stop states from squeezing out taxes out of every little bit of value you produce or hold. You are right that M2 money are numbers in a computer. But so is M1 money. M1 money is numbers in the central bank computer ; M2 is numbers in a commercial bank computer. They have parity in value, because commercial banks arrange that if you want to, you can always exchange limited amounts of M2 into M1. And they use M1 amongst them to do their accountancy, because of course bank B2 doesn't accept bank B1's money, but only M1 money. So if a customer Joe of B1 sends M2 money from B1 to Jack, customer of B2, what actually happens, is that B1 must send the same amount of M1 money from B1 to B2. At that point, B1 destroys the equivalent amount of M2 money in Joe's account is destroyed by B1, and B2 creates the same amount of B2 money in Jack's account. This is like on an exchange: If you've sent 10 bitcoin to Coinbase, then Coinbase has now 10 bitcoin, and creates, out of nothing, 10 "bitcoin IOU" on its website for you. There could be a system that you send those "10 bitcoin IOU" on Coinbase to Jack, who is on Kraken. This function doesn't exist, but it could very well exist one day. What would happen is that if you do an order of 10 bitcoin from your "coinbase account" to Jack's Kraken account, coinbase destroys your IOU on its website, and sends 10 real bitcoin to Kraken. Kraken now gives 10 website bitcoin IOU in Jack's Kraken account. This is how the fiat system more or less works. The fiat system has more to it. If you go to a bank, and you want to borrow money to buy a house, then: - the bank INVENTS NEW bank money for you, and gives you bank money IOU (a bank account) - takes your guaranteed promise to pay back, with the mortgage on newly bought your house The new bank money will go somewhere else when you buy your house with the borrowed money. So the bank will have to transfer M1 money to the other bank. However, in as much as the other bank also has a customer that borrowed money, and sent that money to your bank, both banks are "in equilibrium". So Coinbase and Kraken could do the same. You could go and borrow bitcoin IOU at coinbase. Against your mortgage, coinbase could INVENT NEW bitcoin IOU in your account. If you transfer them to the guy form whom you buy the house, and who has a Kraken account, you would send your bitcoin IOU from your borrowing, to his Kraken account. Coinbase would have to send real bitcoin doing so. But maybe a Kraken customer did the same, and bought a house from a Coinbase customer. So in the end, Coinbase and Kraken have been handling "website bitcoin IOU" like banks handle bank account money. They can permit to have much more bitcoin IOU than there are bitcoin on the chain. Like banks having about 20 times more bank money than there is central bank money. It would be very similar. And the system doesn't work so badly.
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