[2019-01-27]U.S. Gov’t Shutdown is a Major Threat to the Cryptoasset Industry, 2

[Vladdirescu87]

U.S. Gov’t Shutdown is a Major Threat to the Cryptoasset Industry, 2019 & 2020 Top Global Economies

The U.S government has been in a shutdown for more than a month now. So far, this is the longest shutdown in the U.S history and it’s still proceeding since the Parliament in not in position to fund Trump’s idea of constructing a wall on the Mexican border.

Several industries are paralyzed and immobile, and employees are not being paid, having to recourse to living on foodstamps.

Read the details in the article of Coinidol dot com, the world blockchain news outlet: https://coinidol.com/us-govt-shutdown-is-major-threat-to-cryptoasset-industry/

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[DooMAD]

I've got zero sympathy for anyone who had the poor judgement to vote for that farcical caricature you call president.  You're getting everything you deserve.  I also have no sympathy for the ETF vultures.  Go play IOU somewhere else.

For everyone else, now more than ever, you should realise why crypto is designed so that you don't need to rely on government.  If you founded your company with the intent of becoming some sort of middleman to take a cut, meaning you rely on a functioning government and regulation, this is the point where you should start to realise that you're doing it wrong.  Crypto doesn't help middlemen to thrive.  In fact, it does the exact opposite.

Does anyone else think the phrase "cryptoasset industry" sounds like an oxymoron?  It's not an industry if you don't produce anything.  I can't help but think that if people keep trying to recreate traditional finance instruments in crypto, they're going to keep getting burned.  They're going to learn the hard way that it's not a viable business model.

[joniboini]

Last time I checked, Trump announced that the shutdown is over. Can we call it good news? I feel that this shutdown as a 'major threat' is too much. It might postpone/cancel ETF or Bakkt approval but crypto will just do their business as usual. I don't care about ETF or Bakkt at this point tbh, approved or not I'll still use Bitcoin.

This narrative puts too much importance of the US market in the cryptocurrency space as if what happens in the US will dictate where "crypto industry" will go. Meanwhile, Singapore, South Korea, Liechtenstein, Malta and so on already approve and get benefits from the crypto asset industry (read: ICO festival).

[figmentofmyass]

Does anyone else think the phrase "cryptoasset industry" sounds like an oxymoron?  It's not an industry if you don't produce anything.  I can't help but think that if people keep trying to recreate traditional finance instruments in crypto, they're going to keep getting burned.  They're going to learn the hard way that it's not a viable business model.

intuitively, that seems correct. but look around at the potential user base for these instruments---speculators (retail, institutional) who don't want to take custody themselves, mainstream folks who want a user/password to an app and not private keys, etc. you don't think there's a market for these services?

[Kakmakr]

Governments does not determine Bitcoin's success or failure. Most governments are elected by democratic votes and when this government fails to produce the service delivery that are expected of them, people should vote for a new government that can execute that mandate.

Trump was voted in based on his celebrity status and social media manipulation and now they are suffering the consequences of a bad decision. Walls have never stopped people. <Example Berlin wall / Great wall of China / Israel >, so why will the wall between Mexico and the US, be anything different?  

[davis196]

I thought that the US government shutdown is over.There was some agreement between Trump and the congress.There's no impact over the bitcoin price whatsoever.I don't think that the Trump presidency is that bad.It isn't good,but it's not a disaster.

[squatter]

I thought that the US government shutdown is over. There was some agreement between Trump and the congress.

Only temporarily, for about three weeks. If a permanent budget agreement isn't reached by then, the shutdown will continue.

This article is dumb, though -- unsurprising given that it's from Coinidol. If things like Bakkt or an ETF are held back, it's not a threat to the industry at all. Market demand for bitcoins has never been dependent on government rubber stamping or regulated markets. And on the bright side, a bare-bones SEC, CFTC, etc. means no enforcement actions coming down the pipeline either.

[DooMAD]

Does anyone else think the phrase "cryptoasset industry" sounds like an oxymoron?  It's not an industry if you don't produce anything.  I can't help but think that if people keep trying to recreate traditional finance instruments in crypto, they're going to keep getting burned.  They're going to learn the hard way that it's not a viable business model.

intuitively, that seems correct. but look around at the potential user base for these instruments---speculators (retail, institutional) who don't want to take custody themselves, mainstream folks who want a user/password to an app and not private keys, etc. you don't think there's a market for these services?

I think the market for those services will only last to the point where the custodians of those bitcoins start losing them.  Which, in my mind, is pretty much guaranteed when these companies inevitably gather a nice big stash of coins in one place and probably don't take security seriously enough.  There's a distinct likelihood some of these companies will have to pay out more in compensation for lost coins than they'll earn with their middleman fees.  Either that, or the insurance costs for the company will be so high that their prices won't be very attractive for customers.

I could be wrong, but as things stand, I just don't see it going well for these businesses.  If you are the custodian of a large number of bitcoins, you are literally painting a target on your back.  The most secure way to use Bitcoin is if everyone holds their own coins, with no vast sums stored in one conveniently hackable place. 

[figmentofmyass]

intuitively, that seems correct. but look around at the potential user base for these instruments---speculators (retail, institutional) who don't want to take custody themselves, mainstream folks who want a user/password to an app and not private keys, etc. you don't think there's a market for these services?

I think the market for those services will only last to the point where the custodians of those bitcoins start losing them.  Which, in my mind, is pretty much guaranteed when these companies inevitably gather a nice big stash of coins in one place and probably don't take security seriously enough.  There's a distinct likelihood some of these companies will have to pay out more in compensation for lost coins than they'll earn with their middleman fees.  Either that, or the insurance costs for the company will be so high that their prices won't be very attractive for customers.

on a long enough timeline, that's probably true. but there's always the possibility that we're underestimating their hypothetical security practices. also, if the market remains highly speculative, significant account management fees might be justifiable for a certain niche of customer/investor. GBTC comes to mind with its 2% annual fee.

[DooMAD]

I think the market for those services will only last to the point where the custodians of those bitcoins start losing them.  Which, in my mind, is pretty much guaranteed when these companies inevitably gather a nice big stash of coins in one place and probably don't take security seriously enough.  There's a distinct likelihood some of these companies will have to pay out more in compensation for lost coins than they'll earn with their middleman fees.  Either that, or the insurance costs for the company will be so high that their prices won't be very attractive for customers.

on a long enough timeline, that's probably true. but there's always the possibility that we're underestimating their hypothetical security practices. also, if the market remains highly speculative, significant account management fees might be justifiable for a certain niche of customer/investor. GBTC comes to mind with its 2% annual fee.

Maybe, but many exchanges and webwallets still can't get it right.  I don't see these other companies being any different.  There still seem to be a few fairly high profile hacks and heists each year.  No one seems to be learning from past mistakes.  Bitcoin is most secure when it's used directly peer-to-peer and isn't exposed to needless intermediary trust.  The more middlemen you introduce to the equation, the less secure it naturally becomes.

Plus, I get the feeling that as smart contracts become more evolved over time, they'll begin to replace certain types of intermediaries anyway.  Seems to be the way things are heading.  This is all stuff that can be built on top of Bitcoin's sturdy foundations in future.

[hatshepsut93]

What happened to cryptoanarchy, decentralization and removing the middlemen? Now we suddenly have some "Cryptoasset Industry" that depends on the US government? This is ridiculous.

Hiring employees

Bitcoin didn't need any hired workers.

Application delays

Bitcoin never needed any applications.

Bitcoin Exchange Traded Fund approval by SEC delayed

Bitcoin doesn't care.