For context: Turkey has been facing an several year long financial crisis with the Turkish Lira plummeting in value.
Erdoğan has done nothing good to solve the crisis and is just firing the central bank administrator one after the other.
The central bank has brought so much lira with its foreign currency reserve to try to maintain the price that it is almost running dry of any foreign currency, making the future look even bleaker.
Because of this, the population has been rushing in putting their money in other currency/assets (like euro, gold, dollar, ...), which is making the situation worse, so the government has been actively trying to force people to keep their money in lira and even buy more lira if they can.
So whatever they say about it, it is just another move in this direction. They want to prevent people from buying cryptocurrency and further risking depreciating the lira.
Yeah, let's destroy financial systems of governments and substitute it with a system that has 7 tps cap in which the majority of coins belongs to unknown entities (supposedly of criminal origin).
So you don't think it's valuable to give people power over their incompetent government?
7tps on the base layer, you're ignoring layer 2s and all other places where you can exchange crypto without it being recorded on the blockchain, as a matter of fact, unless you're buying directly from a miner, the single transaction that you use to put it in your wallet actually corresponds to many other transactions elsewhere.
> (supposedly of criminal origin)
Big bold claims also require some proof. It's a decentralized protocol that can't be controlled by anyone.
Do you really trust that your gov and the politicians/bankers have your best interest at heart?
So an exchange get's hacked and that makes the origins of Bitcoin criminal? That's like if a bank got hacked and we said US dollar's origin was criminal, it doesn't make any sense.
So if you don't trust them, why would you let them control your money, knowing them doesn't change much.
Sure there are other ways and people are free to choose whichever one they prefer.
> Do you really trust that your gov and the politicians/bankers have your best interest at heart?
On a scale of 0-1, representing my estimate of P(no catastrophic economic/valuation failure in any given year), my trust is: {Government (German): 0.99, Government (UK): 0.85, Politicians (UK): 0.67, Bankers (collectively and internationally): 0.95, BTC: 0.15, Cryptocurrencies in general: 0.05}.
> you're ignoring layer 2s and all other places where you can exchange crypto without it being recorded on the blockchain,
Thus negating all the so-called benefits of the Blockchain, but without the benefits of a double-entry bookkeeping database audited by professionals and with public liability insurance.
Bitcoin was never supposed to be capped at 7 transactions per second, there are no technical reasons for that limit to exist anymore (it was added in 2010 as a temporary measure). Until (if) Bitcoin BTC decides to scale people can use the Bitcoin Cash [0] fork, which today has ~32 times more capacity, with a roadmap to continue scaling to universal usage while keeping fees low [1].
I don't know who is down voting you.. But you are right. That temporary limit has been abused by a faction of people (funded by banks) trying to control Bitcoin. That's why there's a surge of other coins that have removed the limitation. And one of the reasons why Bitcoin's dominance stands below 54% today.
There are a lot of BTC maximalists that see any alternative cryptocurrency as a scam, something which is definitely not true for many of them that have thousands of daily active users. I also feel that many BTC maximalists don't appreciate how Bitcoin Cash makes apparent the limitations of BTC, as it processes more transactions than BTC while keeping fees under 1 cent. txstreet [0] makes for a great visualization, check the statistics at the bottom.
Personally I wish Bitcoin Cash didn't even need to exist, if BTC had scaled as it was originally planned by Satoshi Nakamoto (increasing the maximum block size before it got full). It was sad watching the adoption rate halt and then regress. Remember when BTC was becoming accepted by Steam, Microsoft, Dell, NewEgg and others back in 2015-2016? There is no doubt in my mind that if BTC had scaled properly almost every online shop and a lot of real-world shops would be accepting BTC by now (and incidentally BTC price would be even higher than it is today).
HN always seems to have bitcoin cash fans. I don't get it. Bitcoin cash has 'leaders' in the space who are very quesitonable. Bitcoin cash also has no place if we take into account other cryptos (Monero or Algorand). Bitcoin cash exists only to dilute the bitcoin 'brand' imo.
Bitcoin Cash exists to continue the original scaling plan for Bitcoin: increasing the maximum block size. I watched the Bitcoin scaling debate back in 2014, 2015 and 2016, and every attempt was made to increase BTC's maximum block size without a hard fork, but every move was blocked by Bitcoin Core's developers. "Diluting the Bitcoin brand" was never a goal, but at some point the fork was the only way to scale.
About "Bitcoin cash also has no place if we take into account other cryptos (Monero or Algorand)", I completely disagree. Bitcoin Cash brings a lot to the table:
- Shared history with BTC up to the fork day (August 1, 2017).
- SHA-256d mining, like BTC.
- Much increased capacity, about 20 times higher, with plans to continue scaling to order of magnitudes more.
- Very low fees (less than $0.01), with a roadmap to keep them low as usage grows.
- Reliable almost instant 0-conf for smaller-to-medium transactions, with plans to improve its security.
- Privacy improvements such as CashFusion [1].
I wish Bitcoin Cash didn't need to exist because BTC scaled, but until then I will keep using it and advising others to do so.
I'm not a BCH maximalist, I just want the world to benefit from sound Electronic Peer-to-Peer cash, and BCH works for that today, and is a good candidate for the future. I would use Algorand if it worked, was decentralized (haven't checked the project yet) and was accepted at shops.
I disagree with your comment about PoW because hashrate moves between coins. It's not impossible for hashrate to move from BTC to BCH in the future, especially if BCH adoption continues to rise.
In fairness, "the majority of coins belong to unknown entities (supposedly of criminal origin)" is only a small rephrasing away from a description of Erdogan's government / political party [0]. And they are scarier for Turkish citizens than BTC, since he also aggressively punishes dissent and is a de-facto dictator [1].
Sure, but the fact that Turkey is becoming increasingly corrupt isn't really a good argument why it would be a good idea to take away the ability of all central banks to perform monetary policy to stabilize the economy.
But there are no many surgeons here, theres only one, one central bank. The inflation rate of Turkey is 15%, is anyone really telling people to just "trust the goverment"? Would you put your life savings in the Turkish Lira?
Maybe you are not aware, but there are in fact other countries than Turkey, each with their own currency. Indeed, from Erdogans point of view, the fact that there are other currencies is their whole problem!
And that's fine. The population of each country can decide for themselves where they store their wealth and in which proportions. It's not like Bitcoin is the first tool to enable this. In fact, most Turkish people are much more used to store their wealth in precious metals.
If corruption isn’t a good argument for keeping your money out of a system, what is? Giving them more of your money isn’t going to make them less corrupt.
HN will hand save crypto no matter how much evidence and use cases for it are presented. It's really not worth wasting your breath, although I do hope to one day come here and find actual discussions on EIPs and other technical topics.
When has economic stability ever been a good strategy? Rapid improvement is very unstable.
Furthermore, stability and monetary policy seems to involve handouts to wealthy people. While I can certainly benefit from that, I don't see why handouts for wealthy people are a good idea. It looks like a bad idea. People seem to be getting angrier about it as time passes too.
>When has economic stability ever been a good strategy? Rapid improvement is very unstable.
These are two unrelated things. The relative instability of improvement doesn't have much to do with whether or not it's preferable to have a stable economic system.
Economic stability can be good. Rapid Improvement can be good. Rapid improvement can occur in economically stable times.
I seem to remember from studying economics and history that usually, economic instability occurs AFTER rapid improvement, not before or during. This is in part because rapid improvement outpaces regulation and the economy around it, leading to an unstable economic environment rife with opportunity for good and bad actors to make fortunes.
"why it would be a good idea to take away the ability of all central banks to perform monetary policy to stabilize the economy." laughing in central banker.
You don't need an on-chain transaction for most things, as you can just instantly send BTC over Lightning Network, a second layer on the BTC blockchain. There's no speed limit, it's not on the chain, only nodes between you and the node you paying are involved. It's pretty neat.
6 months away, what? I use it on a regular basis. Before covid I could even buy beer & burgers in my city. You can get coupons for everything, many online stores accept it.
“
Bitrefill provides products and services that allow anyone to live on cryptocurrency more easily. Bitrefill.com provides a catalog of gift cards, prepaid mobile refills, and Lightning networking services that can be purchased using Bitcoin and other cryptocurrencies worldwide. By using Bitcoin and Lightning Network technology we provide a safe and private user experience with fast digital delivery to anywhere in the world.
”
- It forces everyone who wants to receive money to constantly run a node at all times. If their node goes down at any time (or is intentionally taken down by a hacker), in certain situations, they could lose money.
- The channel provider needs to lock up a massive amount of BTC to provide liquidity to channels for all users. It costs BTC to open the channels.
- It's brittle because you need many watchtower nodes to constantly monitor every single participant in real time in order to ensure that nobody cheats and rolls back valid transactions.
- Watchtowers could be fooled by attackers to spend all their processing time on fake frauds to distract them from real frauds.
Sure, if you're in a developed country with proper economical policy and access to an open banking system, your argument stands.
But if you're in a country where your money have been dropping 10% per annum for the last 10 years, and where the concentration is anyway not that different from bitcoin, then things start to make more sense.
Also, most people in this situation are not looking for a day to day transactional currency, but rather for a store of value to hedge against their falling native currency.
If money is opaque then it also cannot be taxed or seized by judicial process. IMO this moves further towards an aristocratic society as possession goes from 90% → 100% to the law.
Cash is opaque, yet governments have been funding themselves via taxation for thousands of years.
If government charged a flat rate for its services, tax evasion would become impossible. One would simply show a proof of payment. This would only be ~$10k/year in US according to its current tax receipts and population. Property tax is also impossible to evade.
Yes, but most people don't keep cash in a box under the bed - they keep it in a bank. This means my elderly mother's house doesn't get broken in to on a regular basis by people trying to take her life savings.
Furthermore, her cash in a bank is protected by the government, and there are safeguards in place to help protect her from people trying to scam anything she has saved away from her. There are also mechanisms in place that when things 'go wrong' she's looked after.
I'm not arguing for or against cryptocurrency, but there is some value to having a society where those that earn more help those that earn less by paying more taxes. I'm also pretty happy to pay for police, and firemen, and someone to pick up my bins, pave my roads, medical care etc. etc. All too often it seems the crypto argument is "I don't want to pay taxes, it's MY money" - yeah, it hurts, but the benefit of doing so is very real.
The caveat, of course, is I say this living in a country with great free medical care, that's actually a pretty nice place to live, even if I really don't agree with some of our politicians. I appreciate not everyone lives in such a country.
Taxation and financial privacy are not mutually exclusive. Taxation and cryptocurrency are not mutually exclusive. Cryptocurrency and banking are not mutually exclusive.
I did say that there is a prevailing undercurrent within the crypto space that government and fiat is bad and wrong and taxing people pretty much amounts to theft. And without some visibility into how much money someone has or is making, ensuring that someone fairly pays taxes becomes a lot harder.
As for the banking part - whilst I understand where you're coming from, cryptocurrency is nowhere near as 'safe' as a regular bank for (probably) 99% of the population. My mum can barely use Amazon...
"custodians like banks" - so a bank then? Until she (eventually) gets all the same protections and benefits she already has from 'regular money' what reason would she (and many others) have to start using 'digital money' instead?
> All too often it seems the crypto argument is "I don't want to pay taxes, it's MY money" - yeah, it hurts, but the benefit of doing so is very real.
> The caveat, of course, is I say this living in a country with great free medical care, that's actually a pretty nice place to live
Unfortunately, not every country is nice. Not every country uses taxes for the benefits of its citizens. Some countries have governments so thoroughly corrupt even the bare minimum only gets done before elections. Some countries have government officials who purchase goods and services at incredibly inflated prices so they can pocket the difference. Government officials who steal money meant for COVID-19 vaccines.
If you're from such a country, paying taxes is really no different than financing any other type of criminal operation. In these cases, avoiding taxes is a moral imperative. In these places, it's the duty of every single citizen to pay as little taxes as they can get away with.
It depends, for instance the way the government collects income tax, even today, is by telling your employer no to pay you but to pay them. The fact that they are unable to seize the money once it's already in your possession doesn't make any difference. And of course the still have the ability to seize your physical assets and to put you in jail.
Most governments on earth are of certainly known criminal origin. In the best case they are taking away 2-5% of your money every year by printing more. And in pathological cases, like Erdoghan, they take 30% and spend it on mega-palace or war with neighbours.
Cryptocurrencies developed on 10+ year old tech, that have stayed in that state throughout may indeed have very poor tps as you state. However, this is absolutely not the majority, as that base tech has iterated both at the base level, and in the application of layers. Typical these days are tps-handling in the 1k's - 10k's, and beyond. This will only keep improving as the technology progresses.
Many systems capable of such throughout are heavily under-utilised, showing that crypto technology is generally ahead of those needs. That there have been hiccups have been more due to "brand loyalty", not tech deficiency, but even those technologies (Ethereum, mainly), are in the process of being upgraded.
Given tps in the fiat world is somewhat of an inapplicable metric, as fiat transactions typically take in the order of days to complete - it's even more of a misleading comparison. Credit cards achieve 30k tps throughput only with the considerable caveats of reversibility and 30 day (or longer) finality. Crypto suffers from no such limitations.
The majority of worth in the space is absolutely not of "criminal origin", demographics of crypto holders have been studied extensively and are readily available.
Brand loyalty is probably less important than network effects. NewTechCoin may be way better than Bitcoin but nobody's going to buy it until everyone else is buying it.
Well, that's what makes cryptocurrency a worthwhile market for speculation. Many folks look to the "market cap ranking" to see what's hot in the space, and going down the list and positioning yourself in a rank 400 coin - a good one that shows promise as a tech platform, a more efficient coin, a useful financial instrument or whatever - is one of the most straightforward ways to see 1000% returns, because even if it doesn't make it all the way up to the top 10, its valuation can grow faster than the market as a whole. (It can also get hit with huge drawdowns when the bear market hits. It's not all roses...)
While it is the case that most things get priced relative to BTC, and this does have a network effect since you end up exiting to BTC and thus reenforce its price, it's increasingly common to see trading pairs for ETH, LTC, USDC/USDT. There is interest in getting more liquidity into the market and that's a large part of "DeFi". It's not that BTC is self-perpetuating lock-in, it's that they're all growing but everything else is running several years behind, so on a day to day basis BTC still holds relatively more of the market.
The question what will happen when Bitcoin flops. Will people trust other crypto? It looks like for the crypto train to keep on chugging, bitcoin needs to be sustained.
Right now it seems to be the main driver indeed. If the 'store of value' Bitcoin fails, I guess in the short term, all crypto's will crash. And then the question will be if one has a decent enough value proposition to rise up again. Although a lot of people are opinionated on this last part, the fact remains that none of us really knows.
Another option is of course that one crypto would just overtake Bitcoin. If I remember correctly this almost happend with Ethereum and was called the flippening. This scenario would be better for crypto of course than a real Bitcoin crash.
I routinely buy things with fiat that complete in seconds. There's on order of trillions of completed fiat transactions per day. They don't generally take days. Only a tiny, tiny amount of them of a very limited class take days. It's disingenuous to imply all fiat transactions take that long.
Your transaction isn't settled instantly. The actual money that flows between institutions behind the scenes is way slower than bitcoin. You can use credit/debit card on Bitcoin too, and your payments seem to go through instantly with whatever tps the network supports.
Your transaction isn't settled instantly. The actual money that flows between institutions behind the scenes is way slower than bitcoin.
... and yet the world turns; and credit cards amount to $3tn of payments in the U.S annually.
As it turns out, businesses do not actually care about instant settlement of payment transactions that much, what's important is instant authorization.
That's absolutely an apples to hand grenades comparison.
First of all, global credit card volumes are much larger than Bitcoin volumes. Asia Pacific has been a bigger credit card market than the U.S. for some time - for example.
Secondly, credit cards payments are overwhelmingly payments for services or goods; effectively none of Bitcoin's total volume is in that category.
In fact, virtually all of Bitcoin volume is gross settlement and relates to speculative trading activity.
Bitcoin trading volumes are in the several trillions per day. I'm not referring to those.
On-chain transactions are for a variety of things, but they are all payments, which was the criteria in question you brought up.
Regardless of how you might opine on those payments "merit" (I could equally deride the usefulness of plastic trinkets ordered from China on Amazon - for what good it would do), they are not insignificant on Bitcoin compared to legacy systems. They are all payments settled either from one party to another, or between one party's multiple accounts, and just because they are almost entirely "only" settlements does not imply they are somehow not useful or otherwise to be derided.
>Bitcoin trading volumes are in the several trillions per day. I'm not referring to those.
Where does that number even come from? I've been trying to source anything that's even vaguely in the same ballpark and coming up empty. Most of the sources I can find suggest ~$100bn a day.
But no, in any case, that's not what I'm talking about either. Nor am I trying to apply any moral value to the purposes to which payments are put.
The point is: you can't say "credit cards are small relative to BTC" without consider the segmentation of the payment market in the fiat world.
I encourage you to provide evidence of the size of the "credit card" usage (i.e. goods and services payments) of BTC. Good data is hard to find but it's self-evidently not in the "trillions of USD per year" order-of-magnitude.
If you want to talk about the gross settlements segment, again, BTC is a minnow. Sure counting every transaction on the BTC blockchain, it's a few $tn a year currently. Fedwire does that much every day, and that's only for inter-institutional transfer.
You said "credit cards amount to $3tn of payments [my emphasis] in the U.S annually.", doing so as if this somehow made crypto appear small. I pointed out that Bitcoin alone does more than this per year in payments since 2018, and that there are thousands of other crypto projects. Many of these are also making comparable numbers of payments.
By the simple metric of how much value cryptocurrency users are transmitting with each other as payments, versus how much users of credit cards are doing - which was the original framing as I understood it - crypto wins. And of course it does, you may be right its an apples to hand grenades comparison, but the simple fact of the matter is we are comparing apples to hand grenades.
In some ways this is all about as useful as comparing how many miles horses and carts are doing versus steam or combustion engines.
The point is, even early on, per mile travelled, engines win. And they do so not just because they can travel further faster, but because they enable new use-cases by doing so - just like crypto.
Crypto has been here for ten years already and despite being derided as a toy early on, is now worth, and transferring, trillions.
See you after the next ten years, when credit cards will almost certainly be as VHS tapes are now.
On a per-value basis, what I have claimed is entirely true.
The bulk of fiat does not move around on peoples payment cards or in cash in their hands, it moves in bank-to-bank transfers that indeed do take days or even weeks, and further have an up to 10% failure rate.
It may well be that through the use of caveats you don't see or think about, you are able to execute small transactions quickly with fiat, but it is the counterparty to your transactions who is bearing the burden of fiats shortcomings in these cases.
For example, if we're comparing digitally, in most cases, you are able to arbitrarily reverse the transaction up to or even over a month later, claiming it as fraudulent, or rejecting it for some other reason justifiable to you, but for which the vendor has little recourse. This is the concept of "transaction finality", and with fiat it is very, very broken.
With cash a similar problem exists with counterfeit money, a vendor may collect up a weeks earnings, only to take them to the bank and have a percentage of them rejected.
All of these problems are solved by crypto, it improves on money in many key ways (these are just a couple), that's its point, and why people are excited about it enough to drive its collective value up to the region of Apple's stock value, around 4x faster than Apple took to do so.
> This is the concept of "transaction finality", and with fiat it is very, very broken.
Worked quite well for me when my credit card details were stolen and I could revert $8k of purchases immediately. If my wallet keys are stolen or cracked, I will lose everything with "transaction finality" - that would be a problem which is enabled not solved by crypto.
As we've seen with the development of centralised exchanges, institutional and retail custodial solutions, many of which are backed by various forms of insurance, the fact that the base layer provides for transactional finality (along with many other things), in no way prevents the development of custodial and insurance-backed solutions on top of it.
That crypto can do new things, and yet may also facilitate all of the (useful) old things, simply makes it a superior tool. There can be no fundamental argument against this.
With the big difference that you can evaluate transactions on current cards and halt future ones preventing damage. If you lose a wallet key, you lose all of it. The insurance solution for that would be extremely high compared to the current network.
Sure but it's trivial to split funds across accounts to mitigate that (even dynamically), unlike with cards where getting/activating a new one is a major hassle.
In theory yes. In practice: 1. those keys will be accessible from the same place/machine 2. people won't do it correctly or will ignore the issue. (if developers can't reliably manage PGP keys, general population balancing multiple wallets is just not happening)
Yes, these are concerns, but anything like this will not ultimately be left to consumers to deal with. As part of the process of crypto becoming widely-adopted, this class of problems is in the process of being solved in ways that are transparent to the user, and that will continue. The fact we are still speaking in terms of the base layer at all in terms of many projects, reveals the stage of development we are at.
It's a bit like worrying about how internet users will deal with IP packets that don't arrive, in the context of thinking about about how smooth an experience they're going to have surfing the web. It's not, and won't be, their problem to deal with.
The fact adoption has rushed ahead such that many multi-millions of users are faced with the base layer is analogous to if millions had rushed into using the internet when it was command-line only. Sure, if that had happened, many people would make mistakes and delete their drives or whatever - and this illustrates how wanted and overdue crypto is.
There are tremendous consequences of using this tech at the base layer incorrectly, but it doesn't appear to be dissuading adoption.
Unless you’re paying cash, average final settlement time is ~90 days, in reality. That’s just been abstracted away from the credit card user. Bitcoin settles in 6 blocks (60 mins)
Now, on the UX topic, btc has a lot to improve. But I’m always surprised how rapidly people assume their transactions in fiat are settling as a comparative criticism for Bitcoin.
One way to look at it is w/ credit cards, bill isn’t due until the end of the month (for a reason, and then all settlement starts occurring once you pay it). Would like a better source, I have that timeframe from an Anthony Pompliamo (VC in the space) interview by Lex Fridman, but I’m looking for a primary source as well.
There are no technical reasons keeping Bitcoin from achieving universal usage (50 daily transactions for each of 10 billion humans) while keeping fees low. This article has a great analysis of not just the technology but the economics and decentralization of the network: http://blog.vermorel.com/journal/2017/12/17/terabyte-blocks-...
Well, if there is such a thing as _the_ feature of credit cards, it's credit, as in deffered payment. Reversibility has its pros and cons. Similar to censorship and centralization. Until crypto, you didn't really have a technological means to prevent it, so it being popular in the fiat financial systems doesn't say anything.
Depends on who you are. For me the features of a credit card all revolve around convenience and risk minimization. Convenience in that I don't have to fumble around with bills and coins. Risk minimization in that US laws give me far more protection from fraudulent uses of my credit card than fraudulent uses of a debit card (and stolen cash is just gone for good).
Only once have I ever use the deferred payment aspect of a card, and that was a 0% APR offer.
While true on some level, this is broadly incorrect.
The necessity for reversibility, and the inflexibility of being limited either to it, or some form of it, is indicative of an inherent, unfixable flaw in the system itself.
This flaw limits the systems growth, adaptability, and usefulness.
Those financial systems are destroying themselves. At the very least, BTC is a check on irresponsible fiscal behavior from central banks and governments. Manage your currency well or get vaporized.
The quality of this comment is not what I'd like to see on this forum. Firstly, do you really have to participate in this derogatory, sarcastic tone? Secondly, transactions per second are cryptocurrency-specific, so your point (about BTC, I presume) is irrelevant. Thirdly, majority of cryptocurrencies belonging to unkowns is fine, what's your point? Lastly, some of those unknowns are criminals: again, what's your point? Please, put some thought into your comments.
> Lastly, some of those unknowns are criminals: again, what's your point?
I think their point is criminals are bad, so anything they use is also bad. Like guns, and drugs, and cars, and food, and beds, and houses, and air. All bad. We shouldn't use those things, and we should ban them at the earliest opportunity.
There are things very useful for criminals and not so much for common people , air doesn't belong go this category, ak-47 and bitcoin yes, are both vastly more useful to criminals that common people, in countries where governments is not oppressive amd against the people (in those countries good and bad behavior may be more or less inverted depending on situation)
You're arguing against privacy. It's weird to have to rehash this debate, ever since tracking and data collection has become a widely recognized problem. Would you like to see Tor shut down as well? Same argument could be made for "unlicensed" encryption. Which feature of cryptocurrencies would you say is useful to criminals, but not to not-criminals? I'd argue that there's no such feature.
Imagine when he learns the currency that the majority of criminals use ...
I agree with you. Comments like that have such a low intellectual effort that they are mainly noise.
People in stable countries (us, uk, western Europe) don't understand the lack of confidence that citizens of underdeveloped countries have in their own government and financial institutions.
Money is power. The more relative power criminals will have over honest people – the more awful this world will be. The world should give power to public creators instead, not to hidden speculators, drug dealers, etc.
The argument that criminals also use ordinary money doesn't work here. Crypto was adopted by them at first, e.g. look at Silk Road, or billion volume hacks of exchanges. If BTC will grow then their relative power will grow.
* False on criminal origin majority, majority is non-criminal [1]
* roughly false on unknown entities for two reasons.
1) btc is fairly easy to surveil [1], and see Chainalysis
2) logic here doesn’t make sense. Are you saying you know all owners of cash deposits, or just assuming someone does? A lot of folks keep cash “in a mattress.” Is that bad as well, as it’s a mirror of holding crypto?
* Is this source from a crypto lobbying group - yes. Is the author the deputy director and twice acting director of the CIA, so he probably knows bitcoin’s use for criminal payments more than the average critic - yes.
- me: criminal activity not a majority of btc use and severely overstated overall, and it enables surveillance, aka intelligence gathering for LEO/IC if properly utilized.
- 30 year veteran, ex-deputy director of the CIA:
“However, based on our research and discussions with industry experts, I have confidence in two conclusions:
• The broad generalizations about the use of Bitcoin in illicit finance are significantly overstated.
• The blockchain ledger on which Bitcoin transac- tions are recorded is an underutilized forensic tool that can be used more widely by law enforcement and the intelligence community to identify and dis- rupt illicit activities. Put simply, blockchain analysis is a highly effective crime fighting and intelligence gathering tool.”
“ All of this together suggests a broader point—that the illicit use of cryptocurrencies in general and Bitcoin in particular, as a share of total market activity, is cer- tainly not higher than it is in the traditional banking system and is most likely less”
Quite literally does say something/anything like what I said.
The report isn't written by Michael Morell, the aforementioned 30 year etc., but "co-authored", and the whole thing was sponsored by Coinbase and Square. Who pays the piper, and all that. And if you want to use his CIA experience as authority: his expertise was counter-terrorism, not "normal" crime, and he defended the use of drone strikes and torture.
Their evidence is: "the firms we spoke with believe the unseen illicit activity is relatively small". That's it. The confident conclusion that it's overstated doesn't even allow you to infer if it's more or less than 50%; it doesn't even say which statistic they actually used.
If it's total percentage of transactions or sum of traded bitcoins, that isn't even that important: you can amass a small fortune in just a handful of transactions, whereas trading bitcoin for investment generates many more transactions, all completely irrelevant to the influence of bitcoin on crime.
There are other quotes from experts available, such as “Bitcoin — and virtual currency in general — is widely used in the trafficking of weapons and drugs, and in ransomware and extortion cases. It is used a lot by criminals.”
Unfortunately the financial systems of governments are getting destroyed and we are powerless to stop it.
Cryptocurrencies are not destroying government run financial systems. They are just an alternative.
Bitcoin's 7 tps is a base-layer limitation. Layer 2 technologies like Lightning aim to address this issue. Lightning is functioning well and growing rapidly.
I don't think it's fair to say most Bitcoin holders are unknown entities. The AML/KYC requirements for converting crypto into spendable fiat are strong. The criminal use of Bitcoin is a small compared to it's legitimate use as a store-of-value.
Even if you take all decentralized currency fads failures, it's hard not to root a little bit for them compared to your own government ruining your life constantly.
Governments cannot ban crypto. They may ban exchanges, but if crypto ever establishes a value of its own as a currency, the government cannot do anything. At least not without basically turning off the internet. Which is, well, not out of the question for Erdogan as he is a dictator.
This sarcastic and snarky view is a bit shortsighted, isn’t it? Piracy worked because it was decentralized distribution. If the government goes after the gatekeepers in the same way they went after piracy they’re not just shutting down distribution - they’re taking the asset too. When someone takes over a coinbase or a binance they’re taking the coins.
Not your keys, not your coins. Your response now will, of course, be “well that’s why you rotate your coins out into cold storage” which is sort of like me saying “you just convert your lira to dollars at the end of the day when you’re done buying food and water.”
It's a good comparison but the value here is orders of magnitude off. A pirate might download a few hundreds of dollars' worth of music and movies. Crypto can be millions of dollars in a transaction. Government goes after the whales, the whole ecosystem dies.
How are you ever going to buy anything physical item ever other than "subscriptions" with crypto, if they ban it?
Afaik govts are having tough time with Online Piracy but not Shipping piracy.
I was also thinking that this is the perfect excuse for them to dump their fiat monetary system and let their citizens adopt crypto... I'm pretty sure all other countries' fiat monetary systems will also fail soon, Turkey has a unique opportunity to allow their citizens to amass large amounts of crypto ahead of every other country... And yet they choose to pass up on that opportunity due to a fear of the unknown.
Imagine if the Turkish government had allowed their citizens to use DogeCoin a few days ago before the big pump, they'd already be out of their recession ;p
Easy counterargument: Policy like the Magnitsky Act can't be implemented as a pre-physical confrontation approach against known bad actors.
If Bitcoin is global currency system then there's no chance of using such a mechanism-tool-lever, however with current system of governments it can be used; Biden's recent financial acids actions against Putin's actions against the US is another example of this.
After turning the country into a dictatorship, regularly arresting and torturing foreign tourists, and now corona, I doubt that there are any tourists left at all.
Most of the countries are lovely when you are a tourist. Sadly being local under a suppressed government, without solid democracy, justice and freedom of speech, with high taxes and very little services, corruption to the bone, destroyed education, political religion, shitty health care, no woman rights, or any equality at all, is not that lovely.
You are in a thin line in Turkey, your life can change dramatically in a blink of an eye, and where you find yourself in really dangerous positions for very basic reasons.
>It’s one of the most popular tourist destinations. The only issue is COVID.
Not true.
Since Erdogan took over and increasingly showed his true face (he started as a moderate muslim democratically elected leader and and basically turned into an Ayatollah since then) many folks in Europe (France, Germany) are very reluctant to travel there for vacation.
> and basically turned into an Ayatollah since then
It's not as simple as that, he's no religious zealot. Erdogan simply leverages conservative support in order to act as an imperialist (and illiberal) king - a new sultan.
And "we" let him do it because "we" need to keep Russia out of Anatolia and the straits, and "we" consider most of the Southern coast of the Mediterranean Sea as a de-facto concentration camp for African and Middle-Eastern migrants.
It also puts off and foreign investors, makes it hard for local businesses to import stuff they need. And leads to corruption if you can only change local to foreign if you get a permit from the ministry run by the presidents nephew etc.
Also with gold. Some news headlines: "Turkey tightens regulation of jewellers after demand for gold soars", "Turkey's Erdogan repeats call for citizens to convert forex, gold holdings".
See, Erdogan has this unorthodox economical theory that if you lower the interest rates, the inflation will decrease and the Turkish lira will stabilize.
The last central bank head was fired after increasing the rates. Erdogan consistently installed figureheads to high ranking positions to implement his theories and those who failed at it were swiftly removed.
The previous Ministry of Treasury and Finance is married to his daughter, for example. The new governor of the central bank is a low grade academician who was paddling Erdogan’s theories in his column at a pro-Erdogan newspaper.
Turkey is that close to become Turkmenistan. Turkmenistan at least has gorgeous horse statues.
"The central bank has brought so much lira with its foreign currency reserve to try to maintain the price that it is almost running dry of any foreign currency, making the future look even bleaker."
All it needs to do is stop doing that and make it clear to the market that it will no longer do that. That removes the patsy from the market and the currency will find its level.
What you have to do is make lira scarce. And you do that by putting taxes up, stop paying interest on lira savings, and putting into administration any firm borrowing in foreign currency but earning in lira, and then refinancing them with lira loans.
All of which is the precise opposite of the view suggested by the "Washington Consensus".
Unfortunately Erdogan is a sound finance guy. Like Putin he thinks money is gold coins and that we're playing some D&D game.
He needs to understand its about the flow of money, not the stock. People holding savings in Gold, Crypto or dollars is a benefit to the lira economy, since it means lira will flow more freely and rapidly increasing economic velocity.
"Using the phrase "Washington Consensus" just indicates you're out of touch and it makes it hard to take any argument you make seriously"
Yet that is still how central banks operate. They are completely out of date, continuing to target inflation using interest rate movements and getting absolutely nowhere. In fact largely getting the opposite response. Everybody knows that they are making no impact, yet nobody dare point it out out of politeness. However this emperor definitely has not clothes at this stage.
The central banks haven't moved on because their operational mode is still stuck in the 1990s. Eventually one will change tack - as New Zealand did before.
Turkey is still weak economically, it has untapped investment opportunities. The USA is extremely strong, at this point the majority of investments have been tapped and we must manufacture artificial investments (infrastructure bill) just to keep macroscopic balance (savings = investments).
What Turkey needs is more foreign investment (plus the trust of its citizens) and that requires eliminating corruption.
Since when did trade liberalization and legal security for property rights die? Did the world Bank suddenly tell us these things didnt matter after all?
Or, is this a variant of the weird perpetual claim made by dyed-in-the-wool neoliberals that they actually don't exist and never did?
> All it needs to do is stop doing that and make it clear to the market that it will no longer do that.
I think that after the sack of the previous governor by Erdogan, it is clear to investors who is really running the Central Bank and what he think. For many investors the only way to make it clear that it will no longer do that is a change not in the CB, but in the Presidency.
> What you have to do is make lira scarce. And you do that by putting taxes up, stop paying interest on lira savings [...]
I disagree with this part. To make lira scarce you have to make it so people are willing to buy lira. If you stop paying interest on lira savings people will sell their liras and buy dollars (this is exactly what happened in the past years).
On the other side if the interest rates are higher people and foreign investors will be more eager to change their dollars for lira, helping the exchange rate. Also higher rates means less people will take credit, reducing the amount of lira circulating. This was exactly was happening with the previous governor.
More importantly, people will buy lira only if they trust the Turkish state and consequently the lira. Just imagine, simply by firing the previous governor (which was considered a competent person), Erdogan caused the Turkish Lira to lose about 10-15% of its value in a single night.
I think that the situation will not improve much unless there are serious economic and institutional reforms, but I don't see them coming while Erdogan is still ruling the country.
> To make lira scarce you have to make it so people are willing to buy lira. If you stop paying interest on lira savings people will sell their liras and buy dollars (this is exactly what happened in the past years).
Which is what you want them to do since that puts lira back into circulation where it passes (higher) tax points which then drains the currency. Reducing government spending would do the same thing.
When there is less lira in circulation, then obtaining it to purchase Turkish output becomes more difficult and the price rises.
People saving in any currency is the problem since the lack of spending it represents denies somebody else an income.
You don't want 'foreign investors'. Turkey has its own currency and can purchase anything available for sale in lira on its own. In fact 'foreign investors' have to obtain lira before they can buy anything so why not cut out the middleman?
> More importantly, people will buy lira only if they trust the Turkish state
Again a myth. People will obtain lira if Erodogan will otherwise jail them for tax evasion. The lira always has value to those with a tax liablity in lira and who are sufficiently scared of Erdogan's tax collectors.
I agree about one thing, the turkish central bank has kept inflation above 2% and real interest rates are roughly at 2%%, therefore it doesn't have to do anything anymore, it just has to wait for the market to do its own thing.
Of course COVID caused massive problems that need a one time fix but Turkey is not in the position of the USA where excess corporate savings are dragging inflation down. If inflation is in the double digits, then people are simply not saving enough. The only thing the central bank needs to do to encourage saving is to keep the interest rate above inflation and it did. The Turkish government can also raise taxes to reign in inflation as you said. If inflation falls faster than the interest rates this would further encourage savings.
> No lender is going to exchange foreign denominated loans for Lira denominated loans during a currency crisis.
They won't get that chance. When the firm is put into administration those foreign loans will be written off, which pushes the loss home to where it belongs - people lending in dollars to entities that have unhedged income in lira.
The state/local investors then buy the firm out of administration with lira loans.
Ok, but then you are advocating that they default on their loans and destroy their credit rating.
...which eliminates their ability to borrow money for several years. And that can have severe impacts on the trade that exists today as creditors scramble to seize Turkish assets held in foreign banks/ports/contracts.
It's a much much more destructive move than what you're describing.
The interest rates set by the Turkish central bank are so high I honestly can't even comprehend why anyone would flee the Lira. You lose 17% to inflation but you also get back 19% from interest. The problem isn't the currency. The problem is that nobody wants to invest into a corrupt regime, people are fleeing Turkey, not the Lira. If Turkey was a trustworthy nation the US government could just purchase Turkish government bonds and solve the problem in an instant.
As a Turkish citizen I can say that the real inflation is much higher than 17% but they are trying to make it look lower by changing the formula constantly so they don't have to raise government employee's salaries so much. I would say the real inflation is closer to 50%.
I didn't do much research so lets assume you are right but at the same time I hope you do not confuse asset prices with consumer prices. The PCI in the USA is correct and people still cry that it is manipulated.
If the government is under reporting inflation that is a problem with the government. The obvious solution is to just report correct inflation. Once the government has reported correct inflation numbers the Turkish central bank must raise interest payments and that would mean at least 52% interest. The fundamental problem doesn't change though. People are still fleeing the influence of the Turkish government, not the currency. You need to trust the government and the government must eliminate internal corruption.
While this is true, as other have said, there is a high chance that inflation is higher than what is shown (although i doubt that this is as much as 50%). But another issue is that the government as been trying to fix its own deficit, due to the lasting crisis, by adding taxes to almost anything.
You now pay taxes for buying a phone (second hand or not), for buying gold, for buying a car (fairly common but it is much higher now), taxes on alcohol are now at an all time high, ... And in general, foreign good cost a lot more. As an example, some of my acquaintance in Turkey are asking me to buy some electronic device (like computer, playstation, ...) here in France and they will send me the money, because the price of those goods in France is overall cheaper, even when you include the cost of converting lira to euro.
Now, this should in fact raise the inflation, but it seems that they indeed chose a way to compute inflation that doesn't show this effect as much.
Something similar happened in Argentina. +60% interest rates with 45% "official" inflation and a constant exchange rate with the USD. I was able to get returns of more then 60% in USD because I sold my mutual funds and bought dollars before they chose to devaluate the peso.
The problem was they allowed the currency to devaluate in a matter of days. People with CDs or mutual funds with long withdrawal time lost a lot of money. I'm talking about going from 18pesos = 1 usd to 36 pesos = 1 usd in something like one week.
You can actually see how the lira is losing against the usd since 2008.
But the article specifically mention payments, not investment.
The way I understand it, you can buy and sell cryptocurrencies and store your money into Bitcoin instead of lira. However you can't say, "I will sell you this for X BTC", instead you have to sell it for Y lira (or euros, dollars, ... I suppose). How the buyer gets the money and what the seller does with it, including selling/buying cryptocurrencies is not part of the payment process, what matters is that there is no BTC on the bill, and presumably, the payment has to be traceable.
How it relates to currency stability, I don't know, but it looks more like an anti money laundering / tax evasion law.
>In a statement explaining the reason behind the ban, the bank said these assets were "neither subject to any regulation and supervision mechanisms nor a central regulatory authority," among other security risks.
Considering lots of miners are from China, no what you've read is not completely true. What's true is that Chinese users have no easy/legal way to convert between crypto and fiat (other than mining, that is).
Why politicians still think that if they ban something then it will magically go away? As if people will think "oh it's banned, I guess I'll stop using it then". It's another weapon against the poor, as those people are the ones who feel consequences of such actions (good example is the war on drugs - poor people are in jail, rich bankers powder their noses as they please).
> Why politicians still think that if they ban something then it will magically go away?
But it probably would. Not completely, but few people would risk putting their life savings or any significant amount of money into something that was illegal.
> Why politicians still think that if they ban something then it will magically go away?
because people don't like to go to jail
> "oh it's banned, I guess I'll stop using it then"
that's exactly what's gonna happen in Turkey though.
But even if it wasn't Turkey which is ruled by an autocrat, a ban would steer away casual users that usually means the thing banned won't succeed in the long run.
imagine if YouTube was banned in some country and the ban would stay even after public protests (admitting that public protests were allowed)
YouTube usage would immediately drop to a number very close to zero.
torrenting illegal material was already illegal, before Netflix.
and France is not Turkey, but no Germany either where the ban on illegal downloads actually works, because they will get you.
In my opinion cause and effect are reversed here: Netflix is going strong because there is a ban on torrents and sharing copyrighted material in general and it worked.
If it was the other way around, Netflix would earn peanuts.
Also, people get around a ban on torrents because there is no risk, the worse thing that can happen is that you won't watch a movie illegally.
Now think about using illegal money and the consequences...
> HADOPI is slowly dying.
again, wrong comparison.
How many people watch YouTube videos in China and how many would if it was not banned?
That's your benchmark.
Look at the ban on guns, where the ban exists the number of guns in people hands is very low.
If it worked as you said, where arms are banned people would use them illegally.
But instead they do not (again: generally speaking).
Think about prostitution, it's legal in Germany where the government estimates the real number may be as high as 400,000 almost 0.5% of the population.
In Italy, where it's practically illegal (it's complicated, but we can safely assume it is not legal as in Germany) the number is estimated at 100,000 or 0,15% of the population.
Bans do work, the fact that not all bans work the same way, doesn't mean that they don't work.
Why? Every time cryptocurrencies get discussed here, the talking points are “crypto is trust-less” (incompatible with centralised), and “government can’t be trusted” (ditto).
I can believe they’ll make a new currency, might even call it a “cryptolira” or whatever as branding, but there is exactly zero value in a government-run money Blockchain. Databases already exist, much lower energy cost, well studied, easy to audit and backup or rollback.
Cynical take: your comment's votes keep fluctuating because those who upvote agree, and those who downvote do it because the comment doesn't add anything to the discussion.
Greece was never stable. It corrupted the auditors to lie about their financial situation and did nothing to improve it.
I have both the feeling that we should have just dropped them to not have a weight on us, and I am empathic to the people who lived there (who were avoiding taxes as well, so that may not be the correct feeling I should have)
I'm a mixture of Greek, Turkish and Bulgarian, and am now a German citizen. I understand that it's impossible for me to be impartial in such discussions but it may help others in the discussion being more civil if you could say something to the tune of "there needs to be consequences" instead of saying that "we" should have dropped "them" not have a "weight" on "us".
I was rather trying to show the mixture of "why bother, just let them go" and "there are real people out there" that was expressed several times (and that was feeling as well).
Hope is an expression of opinion; Unlike tsss, I hope they do get to join the EU — naturally, I’m hoping this is because Turkey changes rather than because the EU does, I’m sure you feel the exact opposite given your username — but tsss was correct to say Turkey isn’t in it.
I never stated that it was. Turkey is meaningless in regards to the future of crypto, just like Germany or Peru is. But the EU has a power of regulation which affects a somewhat significant amount of earth's population, so it makes sense to play with the thought of it.
Hopefully the number of separatist statements will die down eventually.
Blanket statements like this verge on being racist. Totally okay if you state your reasons, and I would also agree that Turkey, in its current political and economic climate is far away from EU compatibility. But, when you say "hopefully never", you indicate that there's something categorically wrong with Turkey joining EU and most people would think race or religion.
We are already there. Europeans all use Coinbase and other US exchanges. Coinbase alone brought over $80B in market cap to the US. 100 times more than the market cap of Yahoo when it IPOed.
Also, Germany and three other European countries are left out explicitly by their EULA. You can create an account and use it for trading, but this would be against their EULA.
It does not matter that much to the ruler. If they know that they will be fine then they will not care.
OTOH they were elected by their population so statistically the population should be happy (this is the case in Poland, where the corrupted/hypocrite government is elected I think now three times in a row. This is pitiful to the population that is against them but at some point you have the country you have, or you leave)
Hmm... I only agree that two of these should be illegal, which are alcohol sold to minors and tanks as private vehicles. Every other one has many aspects that I don't want a government involved in. But there's a lot to be written about that.
See, the problem is that you are savages, no offense.
Of course smoking in public offices must be restricted by the government, which represent the voters and which in turn are elected to govern the State.
The public cannot harm the health of the citizens that it has to protect by mandate.
If you wanna smoke and harm yourself (I am a smoker myself) do it on private property, away from people that have to be there for reasons beyond their will (for example testify at a trial).
Of course the government is the solely ultimate responsible of controlling (i.e. banning for some uses) hard drugs.
Who would you put in charge of it?
Of course it has to control guns, you can't let it control to private entities that profit from arms, it would be crazy!
You would see kids that go to school and shoot other kids.
Lucky us nobody in the World has ever thought of not strictly controlling guns!
That would be a nightmare!
Of course it is the only one who can ban diesel cars from cities and all of the above, you need laws to make it happen, the parliament writes and approves them, it's government's duty to enforce them.
Government is not the enemy, government is the average of public opinion that becomes ruling class for a brief period of time depending on how many votes that coalition of ideas and (of course) interests can get from the citizens.
The idea that the government is formed by aliens who come from another galaxy to ruin our otherwise beautiful peace and harmony is idiotic at best.
First off, I'm not American, nor have I been to the US. Given that you started off with "Americans are savages", I don't really see the point in trying to have any sort of reasonable exchange here...
You can't create accounts to pose as separate persons in an argument, and you can't use HN for flamewar like this. Please stop creating accounts to break the site rules with.
WTF happened here, my new comments are all flagged as dead, why???
I swear I have nothing to do with anything you are implying, why should I reply with a different account when I could have used this one? and BTW my comment had positive upvotes!
that's not me, why in the hell I am being punished for something I haven't done and had no reason to do????
please reverse your decision, you're making a big mistake here.
I have no idea why you assumed that's me, I haven't used my HN account after that comment and looked at it again only today.
Your account appears to be one of a long series of accounts we've previously banned. The holder of these accounts has not only been breaking the site guidelines and getting banned here for years, they've also used multiple accounts in the same threads to appear to be multiple people, which is obviously an abuse in its own right.
It hasnt‘t to be banned officially to be banned effectively. - Here in Germany buying and owning crypto currencies is not illegal. But try to transfer only 20k Euros from your bank account to Kraken.com to buy some crypto assets. Then you might get a letter from your bank telling you they just cancelled your bank account, without telling you why. And they will refuse to explain anything. - Trying to get background infos from insiders on reddit, you‘ll hear that there are departments focusing on money laundering that get noticed whenever largish amounts are being transfered to crypto marketplaces. And that their prefered action is to quit an account instead of investigating details.
In the end you realize that it‘s officially not forbidden, but that you rather don‘t touch these assets.
This is the world we are in 2021. Officially these are measures trying to prevent money laundering and tax evasion, but eventually we wake up in a pretty darn restrictive world where you can‘t even transfer 10k euros from A to B without having to explain things. (If and when you get the chance to explain.)
That's not true, there's no such thing in France, only Banque de France storing your loan and account history that lenders can consult on top of actual circumstances ( employment, etc) to determine credit worthiness
It collects much less information than American credit bureaus, but the SCHUFA does save what banks you have accounts with and for how long - the longer the better.
No, there’s no reason to want to go OTC for just 20k and most desks won’t will deal with you for that amount. That isn’t even half a BTC at current prices, every major exchange has the market depth to support that.
In France we have Tracfin, an institution that tracks the movement of money.
Once you make a transaction over 10k€, the bank has to report it and request from you the reason of the transfer and where the money comes from (initially). They cannot block the transfer but they have several flags attached to the report where they can hint that the transfer is illegal.
You buy a house and transfer the money to the notary? No problem.
You receive money from the UE, there is some explanation do but not that much.
You receive money from a shady place, or send to one (the definition of "shady" is up to the bank and Tracfin), you will need to explain really carefully the move, and you will be on a list.
All in all this is fine, the real problem is if you get into a situation where you are OK but your explanations are not - then you are in trouble.
I haven't made a single transfer of that size but have made many smaller transfers over the last years from Germany and have never had a problem.
If anything I feel like investing in crypto is indirectly incentivized in Germany given that you basically don't owe tax on profits if you buy and hold for over a year without doing anything else.
The situation is kind of mixed in Europe. I was just on to some banks. Santander Jersey said they wouldn't transfer to crypto businesses at all as a policy, Bank Sabadell in Spain has been ok. FirstDirect blocked my payment as suspected fraud but were ok when I called them. You have to try different options sometimes.
Going via Revolut can be a good option though I find them annoying.
> eventually we wake up in a pretty darn restrictive world where you can‘t even transfer 10k euros from A to B without having to explain things
This is the exact problem cryptocurrencies were invented to solve. We're supposed to be free to spend our money without the indignity of having to explain things to some bank or government. The better the technology, the more tyrannical the government must become to maintain the same level of control. We'll either end up with total subversion of government controls or totalitatian governments.
Bitcoin is bad for this. Monero is much better. I'd use it for payments if I could but very few people accept it.
Unfortunately fiat currencies will always be necessary due to force of law. All governments want to have their own currency for some reason. They make laws forcing businesses to accept their currency and refuse to accept taxes in any other currency.
What stability? Governments are literally printing money at unprecedented rates. Fiat currencies are losing value at increasing speeds. We're discussing cryptocurrencies in a thread about Turkey attempting to force citizens to use their own rapidly depreciating currency instead of bitcoin.
> currencies are losing value at increasing speeds
Wouldn't that imply high levels of inflation, which isn't happening in many economies, especially widely available and exchanged ones like USD, EUR, etc.? The value of the Lira is falling and there is high inflation, but it's disingenuous to pretend this is common for currencies and economies around the world.
Right, current value is stable. But there's so much fiat money being issued into circulation without corresponding increase of wealth. That makes its future value risky. Or if there's an explanation why it is not risky I'd like to see one.
Because they are not owed any explanation. It's our money, we should be able to spend it on whatever we want. We don't have to prove anything to anyone.
Anything else means the money doesn't actually belong to us, it belongs to the bank or government and they're just generously allowing us access to it. People work hard every day for a living, they shouldn't have to suffer this sort of indignity.
You're born into a contract with society. If it's purely "your" money, then you should exist outside the protections offered to you by society that is based on a currency anyway.
Contracts are voluntary agreements. Nobody is born into a contract. The idea of a social contract implies we have a choice: accept the group's rules or be removed and lose group benefits. This is simply not possible.
We are forced to try and change the system from within. The means for doing it vary. Lobbying the government, electing favorable politicians, violent revolution... In current times people can just build technology that implements whatever change they want to see in the world. Technology so powerful it alters the "social contract" whether governments want it or not.
Sure, you can destabilize the contract. Make your own money that has its own pitfalls. Just because it’s more advanced technically doesn’t mean it’s better for a society.
A deflationary currency is actually terrible for a world with population growth. It ensures if you were born earlier you have more wealth.
This shows how scared goverments are. And its a great way for the people to put pressure in their goverments, get your sh*t together or Im not trusting you with my money, when people deem bitcoin more stable than your local currency you know things are pretty bad.
The risks cited may have to do with the irreversibility of transactions and the lack of a deposit guarantee scheme when using cryptocurrency.These are valid concerns.
This will however not help with their financial crisis, because the national issuing of money and collection of taxes is still in Turkish Lira. All payment by the government for goods and services is in Lira and needs to be converted to cryptocurrency and all cryptocurrency needs to be converted back to Lira to pay taxes.
Another article about cryptocurrencies, another comments thread where I shake my head at the Cryptozealots spouting "It's the solution to everything! Resistance is futile! You will be assimilated!".
I read something interesting about this behavior a while ago, if you've put money into crypto, of course you're going to be cheerleading it, nobody puts money in something expecting to lose it (oh wait... I can see the /r/wsb crowd raising their hands). And the more people you recruit into your ponzi scheme, the more profit you stand to gain, so consciously or not, you'll be trying to convince everyone to get in on this whole scheme.
On the flipside, the skeptics are convinced it's a bubble that can implode any time and that the argumets "it will replace fiat and central banks!" are just silly delusions. And yes this is how I think. To be honest, I like money too, and I wished I had put some money in BTC. Someone's going to reply "Sour grapes!" under here, but still, I'm in the opinion, the rise of BTC is irrational.
Then again, it can be argued that the current world economy is also running on galactic amounts of irrationality...
What so "clearly" about this? Is the Lira plummeting because it's a fiat currency? Are cryptocurrencies inherentially stable? They can't technically plummet? I don't get how crypto is "clearly" a solution here. Turkey has a financial issue, an economical crisis. The Lira isn't in troubles because people want to audit the database and they can't.
I mean, I get it, if your country's currency is collapsing you usually buy foreign currency or gold, but a lot of times banks control the currency market (and governments/central banks can impose limits that banks have to adhere to), or if you go to a currency exchange they might be out of actual USD notes, and same with gold. Nowadays if you're technically savvy, you can get an online exchange account and buy something with your Lira before it plummets further. It's a selfish move (good for the individuals but bad for the country), but if the country's run by corrupt idiots, and you want to continue to have food on the table, you can't escape being selfish.
Well it's still rubbish for making payments so it's only really useful as an asset you can swap your Lira for along with property, gold, shares, foreign currency and the like.
While I can't substantiate it, I also have the feeling that current crypto hype is unnatural and kind of a bubble. It looks like a lot of fiat money is flowing into crypto and one must wonder where this money is coming from. One obvious source is the overblown money supply of FED/ECB (with claimed reasons the COVID crisis). While initially some of this money must have been poured into things like SP500 (judging by the rapid index recovery in 2020), then it probably found a more fertile ground in the volatility of crypto markets and people's savings followed the hype (somewhat reminiscent of large scale ponzi scheme).
Money supply and the resulting inflation does not serve a good purpose to fiat in the long run, because it diminishes its ability to serve as a store of value. If its other abilities (unit of exchange and accounting) are undermined, fiat will be in real trouble. So, I guess a crypto bubble serves a good purpose as a sort of a buffer for the inflation. In other words, if lots of people lose fiat money on a crypto bubble, there will be less money lost due to inflation for the ordinary folks. Replace crypto with stock, property and other bubbles and you basically get the same effect.
So I guess what the Turkish government is doing is diminishing the ability of crypto to serve as a unit of exchange. If they don't do it, they might very well lose control of their monetary system. That is, all financial transactions (except maybe taxes) bypassing their local currency and leading to even more inflation and a default (or some kid of war).
I feel like in some ways cryptocurrencies might also present a sort of credible threat towards central banks to make sure they keep inflation in check. I'm skeptical about cryptocurrencies (though I'm quite positive about blockchain/smart contracts) but potentially this could be an aspect that all could benefit from, also those who are not invested.
> if lots of people lose fiat money on a crypto bubble, there will be less money lost due to inflation for the ordinary folks
Isn't it a zero sum game? Someone's loss is anothers gain?
But generally the point about the loss of control of the monetary system, plus the billions made annually from the printing press will be in my opinion the limiting factor of crypto as a currency, but will stick around as a store of value purely on inertia for the medium term.
The whole financialized economic system is running on irrational exuberance and is frothy as hell. We could have a collapse in trust and a deflationary shock would send valuations to the ground but that is unlikely to happen because that would threaten the whole financial system, including the bond market. It's almost like the cryptocurrency market is the perfect scheme to take advantage of this situation. The game must go on and the central banks know it, that's why whenever there's a hiccup in the credit markets they intervene. So have fun everyone!
Regardless of the irrationality of current valuations, the cypto asset industry is here to stay and it will slowly syphon more use cases from the traditional financial system. The overall trend is real, just like the Internet trend in 2000 was real, regardless of the subsequent crash. Position yourself accordingly.
>Cryptozealots spouting "It's the solution to everything! Resistance is futile! You will be assimilated!".
is a pretty unusual sentiment on HN. In the comments above I only saw a couple of mildly positive ones.
It's true people do tend to talk their book as it were. I feel I'm semi neutral as I've bought a bit in the booms and sell it when it seems to have peaked.
The truth is probably somewhere in the middle. It won't replace fiat but it's also not going away in a hurry.
> the rise of BTC is irrational.
Yeah but humans are irrational creatures. Life itself is kind of irrational. You muck around a while then die and try to have fun while doing so. Crypto is quite fun.
>To be honest, I like money too, and I wished I had put some money in BTC.
Never too late! ETH is probably going up some more.
I'm not sure how they're planning to enforce this though..
And as the article lays out, for sure all those potential fintech companies who would like to participate with crypto are not going to touch Turkey.. Seems like a counter productive action for a struggling economy.
This has nothing to do with Crypto, or Istanbul not understanding how Crypto markets work. Citizens of Turkey could exchange their Liras freely (cash) on the many small exchanges that exist.
If I was there, I would know that these days are over; and capital/exchange controls are just a few days (weeks at most) of being implemented.
A regulatory move in the same direction from the US wouldn't be that surprising, by the end of this year.
Also an overlooked detail in the article: "Last week, Turkish authorities demanded user information from crypto trading platforms." Your BTC can be an asset that can be seized as part of a confiscation procedure –also in Turkish law... Seriously, not your keys not your money. DEX is under-appreciated in this ecosystem.
Whatever naysayers may think, it looks like the "BTC as a store of value" case is pretty strong if even dictatorial govts are feeling the need to act against it (and Turkey isn't the first, see Venezuela and their various attempts at taking BTC down).
"BTC, timeless store of value, as acknowledged by many dictators around the world" (tm)
In Venezuela they haven't banned cryptos, they banned mining, especially if it's done on state funded electricity (for obvious reasons)/and because other cryptos compete with the state backed crypto, the Petro.
> A total of 100 million Petros will be sold, with an initial value set at $60, based on the price of a barrel of Venezuelan crude in mid-January.
Unfortunately we know that its purpose is raise cash because they can't repay their huge national debt.
Which is why every dictator loves cryptos if they can control them as they control state currencies.
The narrative can be shifted to we are all in this together, we live and die together.
If they'd allow bitcoins for the general population (they love them only for themselves) some would become richer, but the country as a whole would not benefit a bit from it.
And failing at that is something no politician can survive.
Such bans should be seen as a litmus test - this should be seen as a vote of no confidence on the part of the Turkish government in their own currency. Their currency should therefore plummet.
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[ 4.6 ms ] story [ 288 ms ] threadErdoğan has done nothing good to solve the crisis and is just firing the central bank administrator one after the other.
The central bank has brought so much lira with its foreign currency reserve to try to maintain the price that it is almost running dry of any foreign currency, making the future look even bleaker.
Because of this, the population has been rushing in putting their money in other currency/assets (like euro, gold, dollar, ...), which is making the situation worse, so the government has been actively trying to force people to keep their money in lira and even buy more lira if they can.
So whatever they say about it, it is just another move in this direction. They want to prevent people from buying cryptocurrency and further risking depreciating the lira.
7tps on the base layer, you're ignoring layer 2s and all other places where you can exchange crypto without it being recorded on the blockchain, as a matter of fact, unless you're buying directly from a miner, the single transaction that you use to put it in your wallet actually corresponds to many other transactions elsewhere.
> (supposedly of criminal origin)
Big bold claims also require some proof. It's a decentralized protocol that can't be controlled by anyone.
Do you really trust that your gov and the politicians/bankers have your best interest at heart?
I don't have much trust in my government either (Ukraine), but at least I know who they are.
Also there are many other ways to store a value.
[1] https://news.ycombinator.com/item?id=26811111
So if you don't trust them, why would you let them control your money, knowing them doesn't change much.
Sure there are other ways and people are free to choose whichever one they prefer.
On a scale of 0-1, representing my estimate of P(no catastrophic economic/valuation failure in any given year), my trust is: {Government (German): 0.99, Government (UK): 0.85, Politicians (UK): 0.67, Bankers (collectively and internationally): 0.95, BTC: 0.15, Cryptocurrencies in general: 0.05}.
> you're ignoring layer 2s and all other places where you can exchange crypto without it being recorded on the blockchain,
Thus negating all the so-called benefits of the Blockchain, but without the benefits of a double-entry bookkeeping database audited by professionals and with public liability insurance.
https://en.m.wikipedia.org/wiki/GHash.io
[0] https://bitcoincash.org/
[1] https://whybitcoincash.com/
Personally I wish Bitcoin Cash didn't even need to exist, if BTC had scaled as it was originally planned by Satoshi Nakamoto (increasing the maximum block size before it got full). It was sad watching the adoption rate halt and then regress. Remember when BTC was becoming accepted by Steam, Microsoft, Dell, NewEgg and others back in 2015-2016? There is no doubt in my mind that if BTC had scaled properly almost every online shop and a lot of real-world shops would be accepting BTC by now (and incidentally BTC price would be even higher than it is today).
[0] https://txstreet.com/v/bch-btc
About "Bitcoin cash also has no place if we take into account other cryptos (Monero or Algorand)", I completely disagree. Bitcoin Cash brings a lot to the table:
- Shared history with BTC up to the fork day (August 1, 2017).
- SHA-256d mining, like BTC.
- Much increased capacity, about 20 times higher, with plans to continue scaling to order of magnitudes more.
- Very low fees (less than $0.01), with a roadmap to keep them low as usage grows.
- Reliable almost instant 0-conf for smaller-to-medium transactions, with plans to improve its security.
- Privacy improvements such as CashFusion [1].
I wish Bitcoin Cash didn't need to exist because BTC scaled, but until then I will keep using it and advising others to do so.
[1] https://cashfusion.org/
Other coins have low fees and privacy. Neither are unique selling points.
Why not use Algo instead of bitcoin cash? https://algorand.foundation/the-algo/algo-basics
I disagree with your comment about PoW because hashrate moves between coins. It's not impossible for hashrate to move from BTC to BCH in the future, especially if BCH adoption continues to rise.
Disclaimer: I hold huge amount of Algorand as a liquidity or custodial
[0] https://en.wikipedia.org/wiki/2013_corruption_scandal_in_Tur...
[1] https://en.wikipedia.org/wiki/Recep_Tayyip_Erdo%C4%9Fan#Auth...
Are you serious? Honest question.
There are bad surgeons, you should still probably want surgery if you're sick.
The central banks monetary policy is exactly what's destabilizing the economy
Furthermore, stability and monetary policy seems to involve handouts to wealthy people. While I can certainly benefit from that, I don't see why handouts for wealthy people are a good idea. It looks like a bad idea. People seem to be getting angrier about it as time passes too.
These are two unrelated things. The relative instability of improvement doesn't have much to do with whether or not it's preferable to have a stable economic system.
Economic stability can be good. Rapid Improvement can be good. Rapid improvement can occur in economically stable times.
I seem to remember from studying economics and history that usually, economic instability occurs AFTER rapid improvement, not before or during. This is in part because rapid improvement outpaces regulation and the economy around it, leading to an unstable economic environment rife with opportunity for good and bad actors to make fortunes.
The sats will return to you in 2 weeks.
https://bitcoinmagazine.com/.amp/technical/understanding-the...
Such as...?
https://www.bitrefill.com/faq/?hl=en#what-is-bitrefill
- It forces everyone who wants to receive money to constantly run a node at all times. If their node goes down at any time (or is intentionally taken down by a hacker), in certain situations, they could lose money.
- The channel provider needs to lock up a massive amount of BTC to provide liquidity to channels for all users. It costs BTC to open the channels.
- It's brittle because you need many watchtower nodes to constantly monitor every single participant in real time in order to ensure that nobody cheats and rolls back valid transactions.
- Watchtowers could be fooled by attackers to spend all their processing time on fake frauds to distract them from real frauds.
And there are a lot more serious vulnerabilities outlined here: https://www.coindesk.com/bitcoin-lightning-network-vulnerabi...
I think for high volume payment processing, we might as well use centralized payment providers off-chain.
But if you're in a country where your money have been dropping 10% per annum for the last 10 years, and where the concentration is anyway not that different from bitcoin, then things start to make more sense.
Also, most people in this situation are not looking for a day to day transactional currency, but rather for a store of value to hedge against their falling native currency.
Privacy is a feature, not a bug. I don't want people knowing how much money I have.
If government charged a flat rate for its services, tax evasion would become impossible. One would simply show a proof of payment. This would only be ~$10k/year in US according to its current tax receipts and population. Property tax is also impossible to evade.
Furthermore, her cash in a bank is protected by the government, and there are safeguards in place to help protect her from people trying to scam anything she has saved away from her. There are also mechanisms in place that when things 'go wrong' she's looked after.
I'm not arguing for or against cryptocurrency, but there is some value to having a society where those that earn more help those that earn less by paying more taxes. I'm also pretty happy to pay for police, and firemen, and someone to pick up my bins, pave my roads, medical care etc. etc. All too often it seems the crypto argument is "I don't want to pay taxes, it's MY money" - yeah, it hurts, but the benefit of doing so is very real.
The caveat, of course, is I say this living in a country with great free medical care, that's actually a pretty nice place to live, even if I really don't agree with some of our politicians. I appreciate not everyone lives in such a country.
I did say that there is a prevailing undercurrent within the crypto space that government and fiat is bad and wrong and taxing people pretty much amounts to theft. And without some visibility into how much money someone has or is making, ensuring that someone fairly pays taxes becomes a lot harder.
As for the banking part - whilst I understand where you're coming from, cryptocurrency is nowhere near as 'safe' as a regular bank for (probably) 99% of the population. My mum can barely use Amazon...
The banks can give her those same protections and she will be the last to adopt it. She will hardly notice and just tap her card/phone like always
> The caveat, of course, is I say this living in a country with great free medical care, that's actually a pretty nice place to live
Unfortunately, not every country is nice. Not every country uses taxes for the benefits of its citizens. Some countries have governments so thoroughly corrupt even the bare minimum only gets done before elections. Some countries have government officials who purchase goods and services at incredibly inflated prices so they can pocket the difference. Government officials who steal money meant for COVID-19 vaccines.
If you're from such a country, paying taxes is really no different than financing any other type of criminal operation. In these cases, avoiding taxes is a moral imperative. In these places, it's the duty of every single citizen to pay as little taxes as they can get away with.
Is this supposed to be bad? Look at what the US government does with civil forfeiture. Can't do that with cryptocurrencies and that's a good thing.
Cryptocurrencies developed on 10+ year old tech, that have stayed in that state throughout may indeed have very poor tps as you state. However, this is absolutely not the majority, as that base tech has iterated both at the base level, and in the application of layers. Typical these days are tps-handling in the 1k's - 10k's, and beyond. This will only keep improving as the technology progresses.
Many systems capable of such throughout are heavily under-utilised, showing that crypto technology is generally ahead of those needs. That there have been hiccups have been more due to "brand loyalty", not tech deficiency, but even those technologies (Ethereum, mainly), are in the process of being upgraded.
Given tps in the fiat world is somewhat of an inapplicable metric, as fiat transactions typically take in the order of days to complete - it's even more of a misleading comparison. Credit cards achieve 30k tps throughput only with the considerable caveats of reversibility and 30 day (or longer) finality. Crypto suffers from no such limitations.
The majority of worth in the space is absolutely not of "criminal origin", demographics of crypto holders have been studied extensively and are readily available.
While it is the case that most things get priced relative to BTC, and this does have a network effect since you end up exiting to BTC and thus reenforce its price, it's increasingly common to see trading pairs for ETH, LTC, USDC/USDT. There is interest in getting more liquidity into the market and that's a large part of "DeFi". It's not that BTC is self-perpetuating lock-in, it's that they're all growing but everything else is running several years behind, so on a day to day basis BTC still holds relatively more of the market.
Another option is of course that one crypto would just overtake Bitcoin. If I remember correctly this almost happend with Ethereum and was called the flippening. This scenario would be better for crypto of course than a real Bitcoin crash.
... and yet the world turns; and credit cards amount to $3tn of payments in the U.S annually.
As it turns out, businesses do not actually care about instant settlement of payment transactions that much, what's important is instant authorization.
Credit cards are small by comparison.
https://mobile.twitter.com/yassineARK/status/134613927863667...
First of all, global credit card volumes are much larger than Bitcoin volumes. Asia Pacific has been a bigger credit card market than the U.S. for some time - for example.
Secondly, credit cards payments are overwhelmingly payments for services or goods; effectively none of Bitcoin's total volume is in that category.
In fact, virtually all of Bitcoin volume is gross settlement and relates to speculative trading activity.
On-chain transactions are for a variety of things, but they are all payments, which was the criteria in question you brought up.
Regardless of how you might opine on those payments "merit" (I could equally deride the usefulness of plastic trinkets ordered from China on Amazon - for what good it would do), they are not insignificant on Bitcoin compared to legacy systems. They are all payments settled either from one party to another, or between one party's multiple accounts, and just because they are almost entirely "only" settlements does not imply they are somehow not useful or otherwise to be derided.
Where does that number even come from? I've been trying to source anything that's even vaguely in the same ballpark and coming up empty. Most of the sources I can find suggest ~$100bn a day.
But no, in any case, that's not what I'm talking about either. Nor am I trying to apply any moral value to the purposes to which payments are put.
The point is: you can't say "credit cards are small relative to BTC" without consider the segmentation of the payment market in the fiat world.
I encourage you to provide evidence of the size of the "credit card" usage (i.e. goods and services payments) of BTC. Good data is hard to find but it's self-evidently not in the "trillions of USD per year" order-of-magnitude.
If you want to talk about the gross settlements segment, again, BTC is a minnow. Sure counting every transaction on the BTC blockchain, it's a few $tn a year currently. Fedwire does that much every day, and that's only for inter-institutional transfer.
You said "credit cards amount to $3tn of payments [my emphasis] in the U.S annually.", doing so as if this somehow made crypto appear small. I pointed out that Bitcoin alone does more than this per year in payments since 2018, and that there are thousands of other crypto projects. Many of these are also making comparable numbers of payments.
By the simple metric of how much value cryptocurrency users are transmitting with each other as payments, versus how much users of credit cards are doing - which was the original framing as I understood it - crypto wins. And of course it does, you may be right its an apples to hand grenades comparison, but the simple fact of the matter is we are comparing apples to hand grenades.
In some ways this is all about as useful as comparing how many miles horses and carts are doing versus steam or combustion engines.
The point is, even early on, per mile travelled, engines win. And they do so not just because they can travel further faster, but because they enable new use-cases by doing so - just like crypto.
Crypto has been here for ten years already and despite being derided as a toy early on, is now worth, and transferring, trillions.
See you after the next ten years, when credit cards will almost certainly be as VHS tapes are now.
The bulk of fiat does not move around on peoples payment cards or in cash in their hands, it moves in bank-to-bank transfers that indeed do take days or even weeks, and further have an up to 10% failure rate.
It may well be that through the use of caveats you don't see or think about, you are able to execute small transactions quickly with fiat, but it is the counterparty to your transactions who is bearing the burden of fiats shortcomings in these cases.
For example, if we're comparing digitally, in most cases, you are able to arbitrarily reverse the transaction up to or even over a month later, claiming it as fraudulent, or rejecting it for some other reason justifiable to you, but for which the vendor has little recourse. This is the concept of "transaction finality", and with fiat it is very, very broken.
With cash a similar problem exists with counterfeit money, a vendor may collect up a weeks earnings, only to take them to the bank and have a percentage of them rejected.
All of these problems are solved by crypto, it improves on money in many key ways (these are just a couple), that's its point, and why people are excited about it enough to drive its collective value up to the region of Apple's stock value, around 4x faster than Apple took to do so.
Worked quite well for me when my credit card details were stolen and I could revert $8k of purchases immediately. If my wallet keys are stolen or cracked, I will lose everything with "transaction finality" - that would be a problem which is enabled not solved by crypto.
That crypto can do new things, and yet may also facilitate all of the (useful) old things, simply makes it a superior tool. There can be no fundamental argument against this.
It's a bit like worrying about how internet users will deal with IP packets that don't arrive, in the context of thinking about about how smooth an experience they're going to have surfing the web. It's not, and won't be, their problem to deal with.
The fact adoption has rushed ahead such that many multi-millions of users are faced with the base layer is analogous to if millions had rushed into using the internet when it was command-line only. Sure, if that had happened, many people would make mistakes and delete their drives or whatever - and this illustrates how wanted and overdue crypto is.
There are tremendous consequences of using this tech at the base layer incorrectly, but it doesn't appear to be dissuading adoption.
Now, on the UX topic, btc has a lot to improve. But I’m always surprised how rapidly people assume their transactions in fiat are settling as a comparative criticism for Bitcoin.
Do you have a source for that? I tried looking and everything I saw is it would take between 24 hours and 3 days on average, for credit cards.
You very well could be right, I'd just like to see something that confirms it, and wasn't able to find anything.
Example source: https://lifehacker.com/this-is-why-your-credit-card-transact...
But you can't make a trustless exchange on top of a custodial framework.
Base layer has to be trustless / permissionless; all manner of third parties can build all kind of things on top of that.
But reverse isn't true - if base layer controlled by small number of third parties; nothing built on top can claw back that control.
Only once have I ever use the deferred payment aspect of a card, and that was a 0% APR offer.
The necessity for reversibility, and the inflexibility of being limited either to it, or some form of it, is indicative of an inherent, unfixable flaw in the system itself.
This flaw limits the systems growth, adaptability, and usefulness.
Governments do that on their own they don't need any help from crypto.
Banning crypto payments is like an airport refusing landing clearance to bicycles.
I'm fine with that. Current monetary policy sucks.
I think their point is criminals are bad, so anything they use is also bad. Like guns, and drugs, and cars, and food, and beds, and houses, and air. All bad. We shouldn't use those things, and we should ban them at the earliest opportunity.
I agree with you. Comments like that have such a low intellectual effort that they are mainly noise.
People in stable countries (us, uk, western Europe) don't understand the lack of confidence that citizens of underdeveloped countries have in their own government and financial institutions.
The argument that criminals also use ordinary money doesn't work here. Crypto was adopted by them at first, e.g. look at Silk Road, or billion volume hacks of exchanges. If BTC will grow then their relative power will grow.
And you could use this exact argument against the Turkish government banning crypto to protect its own exploitative currency scheme..
* roughly false on unknown entities for two reasons.
1) btc is fairly easy to surveil [1], and see Chainalysis
2) logic here doesn’t make sense. Are you saying you know all owners of cash deposits, or just assuming someone does? A lot of folks keep cash “in a mattress.” Is that bad as well, as it’s a mirror of holding crypto?
[1] https://decrypt.co/66411/cia-bitcoin-surveillance
And
https://cryptoforinnovation.org/resources/Analysis_of_Bitcoi..., for the primary source.*
* Is this source from a crypto lobbying group - yes. Is the author the deputy director and twice acting director of the CIA, so he probably knows bitcoin’s use for criminal payments more than the average critic - yes.
- me: criminal activity not a majority of btc use and severely overstated overall, and it enables surveillance, aka intelligence gathering for LEO/IC if properly utilized.
- 30 year veteran, ex-deputy director of the CIA:
“However, based on our research and discussions with industry experts, I have confidence in two conclusions: • The broad generalizations about the use of Bitcoin in illicit finance are significantly overstated. • The blockchain ledger on which Bitcoin transac- tions are recorded is an underutilized forensic tool that can be used more widely by law enforcement and the intelligence community to identify and dis- rupt illicit activities. Put simply, blockchain analysis is a highly effective crime fighting and intelligence gathering tool.”
“ All of this together suggests a broader point—that the illicit use of cryptocurrencies in general and Bitcoin in particular, as a share of total market activity, is cer- tainly not higher than it is in the traditional banking system and is most likely less”
Quite literally does say something/anything like what I said.
Their evidence is: "the firms we spoke with believe the unseen illicit activity is relatively small". That's it. The confident conclusion that it's overstated doesn't even allow you to infer if it's more or less than 50%; it doesn't even say which statistic they actually used.
If it's total percentage of transactions or sum of traded bitcoins, that isn't even that important: you can amass a small fortune in just a handful of transactions, whereas trading bitcoin for investment generates many more transactions, all completely irrelevant to the influence of bitcoin on crime.
There are other quotes from experts available, such as “Bitcoin — and virtual currency in general — is widely used in the trafficking of weapons and drugs, and in ransomware and extortion cases. It is used a lot by criminals.”
Cryptocurrencies are not destroying government run financial systems. They are just an alternative.
Bitcoin's 7 tps is a base-layer limitation. Layer 2 technologies like Lightning aim to address this issue. Lightning is functioning well and growing rapidly.
I don't think it's fair to say most Bitcoin holders are unknown entities. The AML/KYC requirements for converting crypto into spendable fiat are strong. The criminal use of Bitcoin is a small compared to it's legitimate use as a store-of-value.
Not your keys, not your coins. Your response now will, of course, be “well that’s why you rotate your coins out into cold storage” which is sort of like me saying “you just convert your lira to dollars at the end of the day when you’re done buying food and water.”
Corruption is causing the devaluation of the currency in this case. The devaluation is already a method for hurting the ones responsible.
I'd think that the ones that are corrupt would be able to store their currency in crypto, while the rest of the citizens are not.
Crypto doesn't help anything. It could help some who know how to use it ( and will not forget their password)
Imagine if the Turkish government had allowed their citizens to use DogeCoin a few days ago before the big pump, they'd already be out of their recession ;p
If Bitcoin is global currency system then there's no chance of using such a mechanism-tool-lever, however with current system of governments it can be used; Biden's recent financial acids actions against Putin's actions against the US is another example of this.
You are in a thin line in Turkey, your life can change dramatically in a blink of an eye, and where you find yourself in really dangerous positions for very basic reasons.
Not true.
Since Erdogan took over and increasingly showed his true face (he started as a moderate muslim democratically elected leader and and basically turned into an Ayatollah since then) many folks in Europe (France, Germany) are very reluctant to travel there for vacation.
It's not as simple as that, he's no religious zealot. Erdogan simply leverages conservative support in order to act as an imperialist (and illiberal) king - a new sultan.
And "we" let him do it because "we" need to keep Russia out of Anatolia and the straits, and "we" consider most of the Southern coast of the Mediterranean Sea as a de-facto concentration camp for African and Middle-Eastern migrants.
https://ekurd.net/kurdish-tourists-beaten-turkey-2019-07-20
I couldn't find anything regarding arresting and torturing foreign tourists.
It seldom works very well though in terms of bringing prosperity to the country.
Turkey has a lot more going on than tourism, it has a significant manufacturing sector.
If the Russians took payment for S400s in Bitcoin, they would soon reverse this ban.
Historical context: https://tradingeconomics.com/turkey/interest-rate
The last central bank head was fired after increasing the rates. Erdogan consistently installed figureheads to high ranking positions to implement his theories and those who failed at it were swiftly removed.
The previous Ministry of Treasury and Finance is married to his daughter, for example. The new governor of the central bank is a low grade academician who was paddling Erdogan’s theories in his column at a pro-Erdogan newspaper.
Turkey is that close to become Turkmenistan. Turkmenistan at least has gorgeous horse statues.
All it needs to do is stop doing that and make it clear to the market that it will no longer do that. That removes the patsy from the market and the currency will find its level.
What you have to do is make lira scarce. And you do that by putting taxes up, stop paying interest on lira savings, and putting into administration any firm borrowing in foreign currency but earning in lira, and then refinancing them with lira loans.
All of which is the precise opposite of the view suggested by the "Washington Consensus".
Unfortunately Erdogan is a sound finance guy. Like Putin he thinks money is gold coins and that we're playing some D&D game.
He needs to understand its about the flow of money, not the stock. People holding savings in Gold, Crypto or dollars is a benefit to the lira economy, since it means lira will flow more freely and rapidly increasing economic velocity.
The Washington Consensus was on life support by the year 2002 -- that's two decades ago -- and was completely dead by 2008 -- well over a decade ago.
Making strawman arguments against things 15 years out of date doesn't make your argument look stronger.
Yet that is still how central banks operate. They are completely out of date, continuing to target inflation using interest rate movements and getting absolutely nowhere. In fact largely getting the opposite response. Everybody knows that they are making no impact, yet nobody dare point it out out of politeness. However this emperor definitely has not clothes at this stage.
The central banks haven't moved on because their operational mode is still stuck in the 1990s. Eventually one will change tack - as New Zealand did before.
Hope that is a Western one, not Erdogan.
What Turkey needs is more foreign investment (plus the trust of its citizens) and that requires eliminating corruption.
Since when did trade liberalization and legal security for property rights die? Did the world Bank suddenly tell us these things didnt matter after all?
Or, is this a variant of the weird perpetual claim made by dyed-in-the-wool neoliberals that they actually don't exist and never did?
I think that after the sack of the previous governor by Erdogan, it is clear to investors who is really running the Central Bank and what he think. For many investors the only way to make it clear that it will no longer do that is a change not in the CB, but in the Presidency.
> What you have to do is make lira scarce. And you do that by putting taxes up, stop paying interest on lira savings [...]
I disagree with this part. To make lira scarce you have to make it so people are willing to buy lira. If you stop paying interest on lira savings people will sell their liras and buy dollars (this is exactly what happened in the past years).
On the other side if the interest rates are higher people and foreign investors will be more eager to change their dollars for lira, helping the exchange rate. Also higher rates means less people will take credit, reducing the amount of lira circulating. This was exactly was happening with the previous governor.
More importantly, people will buy lira only if they trust the Turkish state and consequently the lira. Just imagine, simply by firing the previous governor (which was considered a competent person), Erdogan caused the Turkish Lira to lose about 10-15% of its value in a single night. I think that the situation will not improve much unless there are serious economic and institutional reforms, but I don't see them coming while Erdogan is still ruling the country.
Which is what you want them to do since that puts lira back into circulation where it passes (higher) tax points which then drains the currency. Reducing government spending would do the same thing.
When there is less lira in circulation, then obtaining it to purchase Turkish output becomes more difficult and the price rises.
People saving in any currency is the problem since the lack of spending it represents denies somebody else an income.
You don't want 'foreign investors'. Turkey has its own currency and can purchase anything available for sale in lira on its own. In fact 'foreign investors' have to obtain lira before they can buy anything so why not cut out the middleman?
> More importantly, people will buy lira only if they trust the Turkish state
Again a myth. People will obtain lira if Erodogan will otherwise jail them for tax evasion. The lira always has value to those with a tax liablity in lira and who are sufficiently scared of Erdogan's tax collectors.
Of course COVID caused massive problems that need a one time fix but Turkey is not in the position of the USA where excess corporate savings are dragging inflation down. If inflation is in the double digits, then people are simply not saving enough. The only thing the central bank needs to do to encourage saving is to keep the interest rate above inflation and it did. The Turkish government can also raise taxes to reign in inflation as you said. If inflation falls faster than the interest rates this would further encourage savings.
This isn't really an option. No lender is going to exchange foreign denominated loans for Lira denominated loans during a currency crisis.
If he really cannot get the country's finances in order, he's better off just defaulting on all the loans, and starting fresh like Russia did.
They won't get that chance. When the firm is put into administration those foreign loans will be written off, which pushes the loss home to where it belongs - people lending in dollars to entities that have unhedged income in lira.
The state/local investors then buy the firm out of administration with lira loans.
...which eliminates their ability to borrow money for several years. And that can have severe impacts on the trade that exists today as creditors scramble to seize Turkish assets held in foreign banks/ports/contracts.
It's a much much more destructive move than what you're describing.
Not really. It's a refinancing of the firm in a new structure. That happens all the time - with huge amounts of borrowed money.
Getting rid of deadweight loans and refinancing elsewhere is what administration is for, and what happens regularly.
In fact freeing up collateral and sending losses abroad makes a firm more creditworthy, not less.
If the government is under reporting inflation that is a problem with the government. The obvious solution is to just report correct inflation. Once the government has reported correct inflation numbers the Turkish central bank must raise interest payments and that would mean at least 52% interest. The fundamental problem doesn't change though. People are still fleeing the influence of the Turkish government, not the currency. You need to trust the government and the government must eliminate internal corruption.
...which is exactly why they're turning to crypto.
...which is exactly why Turkey enacting currency export controls, like banning crypto.
Now, this should in fact raise the inflation, but it seems that they indeed chose a way to compute inflation that doesn't show this effect as much.
The problem was they allowed the currency to devaluate in a matter of days. People with CDs or mutual funds with long withdrawal time lost a lot of money. I'm talking about going from 18pesos = 1 usd to 36 pesos = 1 usd in something like one week.
You can actually see how the lira is losing against the usd since 2008.
Why would anyone want to hold a depreciating fiat currency when even dogecoin increases in value? They should just stop fighting it and let it happen.
The way I understand it, you can buy and sell cryptocurrencies and store your money into Bitcoin instead of lira. However you can't say, "I will sell you this for X BTC", instead you have to sell it for Y lira (or euros, dollars, ... I suppose). How the buyer gets the money and what the seller does with it, including selling/buying cryptocurrencies is not part of the payment process, what matters is that there is no BTC on the bill, and presumably, the payment has to be traceable.
How it relates to currency stability, I don't know, but it looks more like an anti money laundering / tax evasion law.
That's exactly what they made for, duh
Is that true?
With a lot of crypto activity happening in China, would a crackdown there cause a fall in the market?
Certainly not banned outright though. Parts of Chinese gov have actively invested cash into ICO-less projects
Blockchain in general is also on their five year plan - though at a regional level not the national five year plan
But it probably would. Not completely, but few people would risk putting their life savings or any significant amount of money into something that was illegal.
It means you cannot do the bank transfer to move your Liras to a crypto exchange. It definitely puts a meaningful barrier on buying crypto.
because people don't like to go to jail
> "oh it's banned, I guess I'll stop using it then"
that's exactly what's gonna happen in Turkey though. But even if it wasn't Turkey which is ruled by an autocrat, a ban would steer away casual users that usually means the thing banned won't succeed in the long run.
imagine if YouTube was banned in some country and the ban would stay even after public protests (admitting that public protests were allowed)
YouTube usage would immediately drop to a number very close to zero.
> YouTube usage would immediately drop to a number very close to zero.
Let's take the real example of HADOPI in France, the illustration of the institution that was supposed to hunt bittorrent use in France.
When it was announced, some people dropped bittorrent, but not that much. You had zillions of tutorials on how to avoid it.
What is killing bittorrent is Netflix. As someone else put it very well in another comment: this is a viable alternative.
Now that bittorrent usage is stable and that lots of people moved to netflix because it is easier, HADOPI is slowly dying.
that's not the same thing.
torrenting illegal material was already illegal, before Netflix.
and France is not Turkey, but no Germany either where the ban on illegal downloads actually works, because they will get you.
In my opinion cause and effect are reversed here: Netflix is going strong because there is a ban on torrents and sharing copyrighted material in general and it worked.
If it was the other way around, Netflix would earn peanuts.
Also, people get around a ban on torrents because there is no risk, the worse thing that can happen is that you won't watch a movie illegally.
Now think about using illegal money and the consequences...
> HADOPI is slowly dying.
again, wrong comparison.
How many people watch YouTube videos in China and how many would if it was not banned?
That's your benchmark.
Look at the ban on guns, where the ban exists the number of guns in people hands is very low.
If it worked as you said, where arms are banned people would use them illegally.
But instead they do not (again: generally speaking).
Think about prostitution, it's legal in Germany where the government estimates the real number may be as high as 400,000 almost 0.5% of the population.
In Italy, where it's practically illegal (it's complicated, but we can safely assume it is not legal as in Germany) the number is estimated at 100,000 or 0,15% of the population.
Bans do work, the fact that not all bans work the same way, doesn't mean that they don't work.
I can believe they’ll make a new currency, might even call it a “cryptolira” or whatever as branding, but there is exactly zero value in a government-run money Blockchain. Databases already exist, much lower energy cost, well studied, easy to audit and backup or rollback.
UPDATE: It's fun watching how this comment votes keep fluctuating up and down :-)
The US will then continue developing solution with and for it, eventually building the next big thing, revolutionizing a market.
Wouldn't that then place the EU in a position of a consumer until they can then catch up eventually, if that would even be possible?
...glances at Greece
I have both the feeling that we should have just dropped them to not have a weight on us, and I am empathic to the people who lived there (who were avoiding taxes as well, so that may not be the correct feeling I should have)
I was rather trying to show the mixture of "why bother, just let them go" and "there are real people out there" that was expressed several times (and that was feeling as well).
Once they understand the notion of separation of church and state at a cultural level, that may become a possibility again.
This will likely be a very long while though.
I never stated that it was. Turkey is meaningless in regards to the future of crypto, just like Germany or Peru is. But the EU has a power of regulation which affects a somewhat significant amount of earth's population, so it makes sense to play with the thought of it.
Blanket statements like this verge on being racist. Totally okay if you state your reasons, and I would also agree that Turkey, in its current political and economic climate is far away from EU compatibility. But, when you say "hopefully never", you indicate that there's something categorically wrong with Turkey joining EU and most people would think race or religion.
In short: Please don't do blanket statements.
source? I dont use coinbase because of higher costs and all the US shenanigans with other people's data
They certainly don't.
Coinbase is one of the, if not THE most expensive exchange on the planet.
Their infra stack is a disaster, and their feature set, espectially when it comes to transacting with non-US bank is a freaking nightmare.
Only the captive US market that can't use EU-based exchanges is forced to use coinbase.
https://www.coinbase.com/places
OTOH they were elected by their population so statistically the population should be happy (this is the case in Poland, where the corrupted/hypocrite government is elected I think now three times in a row. This is pitiful to the population that is against them but at some point you have the country you have, or you leave)
They are printing too much money for the rich and not helping/saving anyone and want to block all from getting away.
That's probably not gonna work. Banning something has proven to never work in history.
By definition there are lots of banned things in every legal system, and I'd argue many of them for very good reasons.
What's usually ineffective is banning something without providing a viable alternative.
alcohol sold to minors.
unlicensed doctors.
guns.
hard drugs.
tanks as private vehicles.
old polluting cars.
the list is endless.
See, the problem is that you are savages, no offense.
Of course smoking in public offices must be restricted by the government, which represent the voters and which in turn are elected to govern the State.
The public cannot harm the health of the citizens that it has to protect by mandate.
If you wanna smoke and harm yourself (I am a smoker myself) do it on private property, away from people that have to be there for reasons beyond their will (for example testify at a trial).
Of course the government is the solely ultimate responsible of controlling (i.e. banning for some uses) hard drugs.
Who would you put in charge of it?
Of course it has to control guns, you can't let it control to private entities that profit from arms, it would be crazy!
You would see kids that go to school and shoot other kids.
Lucky us nobody in the World has ever thought of not strictly controlling guns!
That would be a nightmare!
Of course it is the only one who can ban diesel cars from cities and all of the above, you need laws to make it happen, the parliament writes and approves them, it's government's duty to enforce them.
Government is not the enemy, government is the average of public opinion that becomes ruling class for a brief period of time depending on how many votes that coalition of ideas and (of course) interests can get from the citizens.
The idea that the government is formed by aliens who come from another galaxy to ruin our otherwise beautiful peace and harmony is idiotic at best.
The definition of the word "savage" from the Cambridge dictionary states
savage
adjective
uk /ˈsæv.ɪdʒ/ us /ˈsæv.ɪdʒ/
extremely violent, wild, or frightening.
Americans from USA are savages under that definition.
But I'm interested to know why you think that the government shouldn't care about pollution and who actually should.
https://news.ycombinator.com/newsguidelines.html
I swear I have nothing to do with anything you are implying, why should I reply with a different account when I could have used this one? and BTW my comment had positive upvotes!
that's not me, why in the hell I am being punished for something I haven't done and had no reason to do????
please reverse your decision, you're making a big mistake here.
I have no idea why you assumed that's me, I haven't used my HN account after that comment and looked at it again only today.
Is this some kind of joke?
Have I upset the wrong person?
This is my first account here, I've been reading HN for no more than a year now...
> they've also used multiple accounts in the same threads to appear to be multiple people, which is obviously an abuse in its own right
What?
I repeat myself: you're making a big mistake, I don't know how you jumped at those conclusions, but they are wrong.
Why in the hell should I have done that?
My parent comment received another upvote after you banned me.
Where's the proof of what you say?
I had no reason, no motive and there's obviously no gain from doing it.
Are you implying that I am stupid?
Please reconsider.
Or don't, I can live without HN.
You know what's frustrating?
Being the black man that is banned, without proof, by white people with blue eyes.
History repeating...
In the end you realize that it‘s officially not forbidden, but that you rather don‘t touch these assets.
This is the world we are in 2021. Officially these are measures trying to prevent money laundering and tax evasion, but eventually we wake up in a pretty darn restrictive world where you can‘t even transfer 10k euros from A to B without having to explain things. (If and when you get the chance to explain.)
## Edit
But banks cancelling your account is not something without consequences. Your credit rating may and propably will suffer.
They are probably right in most of cases, given how widespread corruption is.
What you want, and what the administration of the Gulag you currently live in are - on average - two very different things.
Once you make a transaction over 10k€, the bank has to report it and request from you the reason of the transfer and where the money comes from (initially). They cannot block the transfer but they have several flags attached to the report where they can hint that the transfer is illegal.
You buy a house and transfer the money to the notary? No problem.
You receive money from the UE, there is some explanation do but not that much.
You receive money from a shady place, or send to one (the definition of "shady" is up to the bank and Tracfin), you will need to explain really carefully the move, and you will be on a list.
All in all this is fine, the real problem is if you get into a situation where you are OK but your explanations are not - then you are in trouble.
If anything I feel like investing in crypto is indirectly incentivized in Germany given that you basically don't owe tax on profits if you buy and hold for over a year without doing anything else.
Going via Revolut can be a good option though I find them annoying.
This is the exact problem cryptocurrencies were invented to solve. We're supposed to be free to spend our money without the indignity of having to explain things to some bank or government. The better the technology, the more tyrannical the government must become to maintain the same level of control. We'll either end up with total subversion of government controls or totalitatian governments.
Unfortunately fiat currencies will always be necessary due to force of law. All governments want to have their own currency for some reason. They make laws forcing businesses to accept their currency and refuse to accept taxes in any other currency.
Wouldn't that imply high levels of inflation, which isn't happening in many economies, especially widely available and exchanged ones like USD, EUR, etc.? The value of the Lira is falling and there is high inflation, but it's disingenuous to pretend this is common for currencies and economies around the world.
Why do you think that?
Anything else means the money doesn't actually belong to us, it belongs to the bank or government and they're just generously allowing us access to it. People work hard every day for a living, they shouldn't have to suffer this sort of indignity.
We are forced to try and change the system from within. The means for doing it vary. Lobbying the government, electing favorable politicians, violent revolution... In current times people can just build technology that implements whatever change they want to see in the world. Technology so powerful it alters the "social contract" whether governments want it or not.
A deflationary currency is actually terrible for a world with population growth. It ensures if you were born earlier you have more wealth.
And I say this with 50% NW in crypto.
Time to change bank.
And you're in Europe, which means you should be able to go bank-shopping beyond German borders.
Competition is a good thing, but customers must make use of it.
This will however not help with their financial crisis, because the national issuing of money and collection of taxes is still in Turkish Lira. All payment by the government for goods and services is in Lira and needs to be converted to cryptocurrency and all cryptocurrency needs to be converted back to Lira to pay taxes.
I read something interesting about this behavior a while ago, if you've put money into crypto, of course you're going to be cheerleading it, nobody puts money in something expecting to lose it (oh wait... I can see the /r/wsb crowd raising their hands). And the more people you recruit into your ponzi scheme, the more profit you stand to gain, so consciously or not, you'll be trying to convince everyone to get in on this whole scheme.
On the flipside, the skeptics are convinced it's a bubble that can implode any time and that the argumets "it will replace fiat and central banks!" are just silly delusions. And yes this is how I think. To be honest, I like money too, and I wished I had put some money in BTC. Someone's going to reply "Sour grapes!" under here, but still, I'm in the opinion, the rise of BTC is irrational.
Then again, it can be argued that the current world economy is also running on galactic amounts of irrationality...
replace crypto with $TSLA or $XXXX , people will try to justify their whatever decisions
Money supply and the resulting inflation does not serve a good purpose to fiat in the long run, because it diminishes its ability to serve as a store of value. If its other abilities (unit of exchange and accounting) are undermined, fiat will be in real trouble. So, I guess a crypto bubble serves a good purpose as a sort of a buffer for the inflation. In other words, if lots of people lose fiat money on a crypto bubble, there will be less money lost due to inflation for the ordinary folks. Replace crypto with stock, property and other bubbles and you basically get the same effect.
So I guess what the Turkish government is doing is diminishing the ability of crypto to serve as a unit of exchange. If they don't do it, they might very well lose control of their monetary system. That is, all financial transactions (except maybe taxes) bypassing their local currency and leading to even more inflation and a default (or some kid of war).
Isn't it a zero sum game? Someone's loss is anothers gain?
But generally the point about the loss of control of the monetary system, plus the billions made annually from the printing press will be in my opinion the limiting factor of crypto as a currency, but will stick around as a store of value purely on inertia for the medium term.
Regardless of the irrationality of current valuations, the cypto asset industry is here to stay and it will slowly syphon more use cases from the traditional financial system. The overall trend is real, just like the Internet trend in 2000 was real, regardless of the subsequent crash. Position yourself accordingly.
is a pretty unusual sentiment on HN. In the comments above I only saw a couple of mildly positive ones.
It's true people do tend to talk their book as it were. I feel I'm semi neutral as I've bought a bit in the booms and sell it when it seems to have peaked.
The truth is probably somewhere in the middle. It won't replace fiat but it's also not going away in a hurry.
> the rise of BTC is irrational.
Yeah but humans are irrational creatures. Life itself is kind of irrational. You muck around a while then die and try to have fun while doing so. Crypto is quite fun.
>To be honest, I like money too, and I wished I had put some money in BTC.
Never too late! ETH is probably going up some more.
https://www.youtube.com/watch?v=sZHCVyllnck
Sorry, couldn't resist.
And as the article lays out, for sure all those potential fintech companies who would like to participate with crypto are not going to touch Turkey.. Seems like a counter productive action for a struggling economy.
Two weeks ago: https://www.dailysabah.com/business/finance/turkey-demands-u...
Two days ago: https://ahvalnews.com/turkey-gold/turkey-tightens-regulation...
This has nothing to do with Crypto, or Istanbul not understanding how Crypto markets work. Citizens of Turkey could exchange their Liras freely (cash) on the many small exchanges that exist.
If I was there, I would know that these days are over; and capital/exchange controls are just a few days (weeks at most) of being implemented.
Also an overlooked detail in the article: "Last week, Turkish authorities demanded user information from crypto trading platforms." Your BTC can be an asset that can be seized as part of a confiscation procedure –also in Turkish law... Seriously, not your keys not your money. DEX is under-appreciated in this ecosystem.
Shame really, up until not long ago (before Erdogan) Turkey was a really nice place to visit and on its way up economically (and the food, yum).
But now, they're headed straight back to the dark ages.
"BTC, timeless store of value, as acknowledged by many dictators around the world" (tm)
In Venezuela they haven't banned cryptos, they banned mining, especially if it's done on state funded electricity (for obvious reasons)/and because other cryptos compete with the state backed crypto, the Petro.
Dictators love cryptos, especially bitcoins.
If they didn't, criminals wouldn't use them.
> A total of 100 million Petros will be sold, with an initial value set at $60, based on the price of a barrel of Venezuelan crude in mid-January.
Unfortunately we know that its purpose is raise cash because they can't repay their huge national debt.
Which is why every dictator loves cryptos if they can control them as they control state currencies.
The narrative can be shifted to we are all in this together, we live and die together.
If they'd allow bitcoins for the general population (they love them only for themselves) some would become richer, but the country as a whole would not benefit a bit from it.
And failing at that is something no politician can survive.
Custodial solutions like Coinbase can be banned. Full nodes are much harder to ban.