So either Mark Cuban is dumber than the Average Joe or ... the Average Joe probably isn't any more capable of handling a crypto wallet and would be better saved by a fiat bank account.
To paraphrase the first episode of https://podcasts.apple.com/us/podcast/two-and-a-half-coins/i... the banking world was already decentralized, so much that it’s inefficient and insecure. Crypto, at least part of the technology, is about simulating some sort of centralization by using a distributed database (which is resilient to byzantine faults). So banks can switch backbone for a more efficient and secure one, users don’t have to know or care about it.
I see this as a great opportunity to learn the next few lessons of traditional Finance system that lead to them not being finite and only driven by market forces.
Crypto really feels like a speed run of human monetary history.
Which money are you talking about? Most monies are driven substantially by monetary policy and other direct government intervention. The very reason fiat is no longer finite is due to government intervention in the 1930s (going off the gold standard).
Bitcoin (e.g.) is actually much more like gold in that the amount of it in circulation isn't determined by any law, policy or intervention.
The amount of bitcoin in circulation is very much determined by policies - the software of the bitcoin clients and servers. It is quite possible that mining rewards will be altered in the future as the amount dries up.
Bitcoin is not immutable. The current chain would make absolutely no sense to a (full-validating) client from 2011 due to various additions and protocol changes.
What it is, as a project, is being extremely conservative, but that's a human political value, not a property of a technical system.
The difference is this would require a hard fork, and the value of this fork would be determined entirely by market forces. Imagine if when the US decided to 'print' a few trillion bucks, it resulted in the creation of a new USD2 currency. And you were free to keep using USD1 or swap over to USD2. More or less the exact same thing has already happened with Bitcoin multiple times, with the outcome you could expect.
It's quite interesting in an economic sense too because, unlike our USD2 analogy, in the Bitcoin world users actually keep all their money in both forks (so if you have $1000 in USD, you'd also have $1000 in USD2) yet disproportionately favor one currency to the point that e.g. Bitcoin Cash is worth $217 per coin, while BTC mainline is worth $26,000 per coin.
Not necessarily. The main BTC software has already changed a few times over the years, and nothing prevents it from changing again. If the BTC maintainers and major miners would agree, they could very well push this change. The same way they decided to stop expanding the block size, for example.
The forks were the result of a split in the community. Not every change actually results in a fork.
It's more fair to say that currencies only decided to 'go infinite' starting in 1971. [1] Up until then Western currencies were still driven by the Bretton Woods System. [2] In this system the USD was convertible to gold at a fixed rate, which was a defacto gold backing. Of course 50 years feels like an eternity to most of us, because it's literally our entire existence. But on a historic scale 'infinite' currencies may yet end up being one of the most short-lived widescale experimental failures in monetary systems, ever.
This is even more true if one considers that after we defaulted on our obligations under Bretton Woods, we almost immediately transitioned to the petro dollar, making the USD the only way to obtain the most in-demand commodity in existence. So it still kind of had a backing. We've only really started to become 'free floating' extremely recently as more major oil producers turn against the petrodollar. And it doesn't seem to be leading to happy places.
There's a nuance here. When Germany and Canada trade, they settle that balance in USD. This means if another country just prints a bunch of money, they're actually going to suffer for it. By contrast, when the US prints a bunch of money, it means countries whose currencies strengthen against it stand to risk pricing themselves out of the biggest consumer market in the world. It tends to drive other countries to also weaken their currency. This is one of the ways that the US exports its inflation - "exporting inflation" being a term you could find a lot more hits on if this topic interests you.
If you look at countries by debt to GDP, the US is peers with economies like Laos, Sudan, Italy, Venezuela, and so on. [1] The unique position of the dollar alongside being the largest consumer economy gives the government immense room to absorb economic blunders. At least until the house of cards collapses, which will make 1929 look like the good ole days. This is one of the many reasons people are interested in currencies that cannot be manipulated outside of normal market forces.
> Bitcoin (e.g.) is actually much more like gold in that the amount of it in circulation isn't determined by any law, policy or intervention.
How so? Bitcoin is a set of political/economic ideas about money encoded into software by a group of humans, who are historically known to sometimes change their minds over time.
As long as I don't change my mind, my wallet software will not see any of those changes as legitimate, just as it didn't see Bitcoin Cash or Bitcoin SV as legitimate.
The chain is very mutable! How would SegWit and other changes have been implemented otherwise? Or does the official chain stop at some point in 2011 for you, soon after the genesis block?
Every fork happens in order to effect some change – and whether that change is beneficial or not is the matter of policy, not technology.
Voting against a fork (with your mining power or wallet) is also a policy decision. You can't escape human nature in a system built and used by humans, not even in a very conservative/change-averse one, because conservatism is, once again, a human value, not a technological one.
> The chain is very mutable! How would SegWit and other changes have been implemented otherwise?
Through backwards-compatible soft forks.
Nobody removed the ability to make non-segwit transactions. SegWit did not change the existing transaction format or change the chain, it repurposed the "anyone-can-spend" transaction space.
Unlike with a lot of other cryptocurrencies, the Bitcoin dev team bends over backwards to try to make sure their protocol updates extend the existing protocol rather than changing it.
And most critically neither issuance nor balances have been changed, with the exception of the isolated value overflow error that was corrected during Bitcoin's infancy in 2010.
> Every fork happens in order to effect some change – and whether that change is beneficial or not is the matter of policy, not technology.
It's a matter of individual opinion. And with Bitcoin, every individual user can assert their own opinion by running the protocol version that aligns most with their own opinion. You can't opt out of your bank's software update.
> Voting against a fork (with your mining power or wallet) is also a policy decision. You can't escape human nature in a system built and used by humans, not even in a very conservative/change-averse one, because conservatism is, once again, a human value, not a technological one.
I can't argue with that. Being a bitcoin user is inherently a policy decision.
Everyone makes a policy decision by clicking the "download" button. It's part of Bitcoin's strength and it's part of Bitcoin's weakness.
I’ve transferred a few million dollars with CurrencyFair by now, the transfer across continents has always been less than 24hrs, the notification from my bank arriving before the emitter tells me it’s sent; only 4$ per transaction (so 0.003%) and the rate always within 0.5% of the stock exchange (less than the 2-3% it costs with Bitcoins).
Therefore the point of faster settlement and less burocracy doesn’t stand unless you are selling weapons, which proves that Bitcoin is only useful for criminal schemes.
State of the art crypto is instant payment, not “less than 24h”. For example, I get paid in crypto sometimes for work, I just get the money directly. The last gig I did in USD was like 2 weeks ago and I still haven’t seen the money in the bank account (altho bill.com has confirmed that it was sent)
None of that is a given with central custodians, which very often already have to comply with regulations concerning money laundering, embargo enforcement etc.
> (instead of the awful SWIFT)
SWIFT is a real-time messaging network.
International transactions being slow has almost nothing to do with legacy technologies – it's partially outdated processes (batch processing facilitates netting, and netting preserves liquidity!), but overwhelmingly that we (or at least the regulators making the rules) want them to be slow enough to be able to intervene in case of financial crimes.
Corrupt courts can't steal it, so my phrases on paper and USB locked in safes separated by 2000 miles helps me diversify. Governments do collapse, and I can recreate my signing keys from anywhere. It's different than a dozen gold coins in my pocket.
How is a crypto custodian immune to court orders, corrupt or otherwise?
> my phrases on paper and USB locked in safes separated by 2000 miles
That's nice (unless you lose access to both or make some other operational mistake), but literally the opposite of central crypto custody, which is what this thread is about.
I thought it was about self-custody via a web browser extension. Did I misread the article about Mark Cuban losing funds and then sending some to a custodian?
This doesn’t feel right to me: Mark Cuban is obviously a general target because he’s rich, but there are probably (tens of?) thousands of people not as rich as him who keep similar amounts of cryptocurrency in hot wallets. That’s all that matters to these specific attackers.
It's not that hard to be too stupid to realize you're going to get caught without being too stupid to realize that rich people have more money than poor people do.
Remember how Cuban made his fortune. He didn't build something great. He built something worthless and pawned it off on the dumbest guys in the room at the peak of the dotcom bubble.
Typically a 'hot wallet' is something connected full time. He had a web browser extension (which turns on and off) and apparently connected it to ... speculating ... sign a transaction which maybe then allowed the draining.
I have a very negative view of cryptocurrencies generally but I cannot imagine the anxiety and stress those in cryptocurrencies must feel:
- "Not your keys, not your coins" very frequently turns into "your keys, some scammers coins". Or "your keys, not your coins and no ones coins" when you lose access to a wallet by losing the private key, seed phrase, etc. Look around forums, subreddits, twitter, etc... These people expend tremendous amounts of time and energy just trying not to lose everything forever.
- Your other option is hosting them with custodians that have frequently proven to be anywhere from incompetent/reckless to outright criminals.
Time and time again individuals who are significantly more technical and astute than the general population STILL fall victims to both of these scenarios and many, many more.
Almost 15 years after the launch of bitcoin and at least tens of billions of dollars invested in development in the space there is still nowhere on the horizon any of this is ready for anything approaching mass adoption.
Other than the basic human trait of greed and gambling, get rich quick schemes, criminal and nefarious purposes, etc I have no idea how any of this is still a "thing".
> Other than the basic human trait of greed and gambling, get rich quick schemes, criminal and nefarious purposes, etc I have no idea how any of this is still a "thing".
I think you asked and answered your own question. It's still "a thing" because people still speculate on it. In particular, people gamble on it being more of "a thing" in the future.
>Almost 15 years after the launch of bitcoin and at least tens of billions of dollars invested in development in the space there is still nowhere on the horizon any of this is ready for anything approaching mass adoption.
You hit the nail on the head. Nobody can directly buy water, milk, fuel, transportation, or anything necessary with bitcoin. Its only legitimate use is an exotic and volatile investment vehicle for millionaires to play with.
Not trying to claim any expertise in the matter, but couldn't you say the same for gold? Any of us would love to have a box of it, but you can't do squat with it at the grocery store or the gas station.
I would love to come across a free box of gold, or a private key holding a large sum in bitcoin, or anything similar. HOWEVER, that is not because I would like to keep holding onto it -- just to convert it to cash and then convert that cash proportionally to cash/short term/long term investments.
I'd probably hold it as is. I wouldn't ever consider converting some of my hard-earned cash into bitcoin or physical gold, but for a no-cost investment I'll take the diversification.
Gold is an nonreactive and pretty metal, which itself makes it valuable. People independently regarded it as valuable across different cultures for thousands of years.
Fun fact: Technically, you could buy $50 dollars of groceries with an American Gold Eagle. You'd definitely confuse the cashier though.
Most of the people holding gold in a serious sense never actually see or touch it. They delegate that to trusted entities who can provide all the physical security and auditing that an average person can't. I feel like there's a parallel with the blockchain, in the sense that actual bitcoin is "heavy" to move but you can to a lot of IOU deals on the fringe of it.
> Almost 15,000 years after the launch of Gold and at least tens of billions of dollars invested in development in the space there is still nowhere on the horizon any of this is ready for anything approaching mass adoption. No one uses gold for store of value or purchases, it clearly has failed miserably.
Except that gold is also obsolete as currency, even if not as a store of value. If cryptocurrencies want to throw in the towel on the "currency" part, then I look forward to them adopting a new moniker, rather than trying to sneakily move the goalposts.
I bought 2 whole computers, a 3D printer and many parts for different equipment paid with Bitcoin.
Perhaps not quite "water, milk, fuel, transportation, or anything necessary" but certainly far from "an exotic and volatile investment vehicle for millionaires to play with".
Mentioning some relatively niche gadgets as a showcase example actually supports the premise of Bitcoin being nowhere near being ready for mass adoption. People would want to hear something like "I paid for all my needs for a full week with Bitcoins".
I remember (but very poorly, as this was over a quarter century ago and wasn't that important to me) back when there was a TV show (I remember this being in Japan, but that is quite likely my brain filling in gaps) where they locked someone in a room and they had to figure out how to live off of only things they could purchase off the Internet. Of course, this was extremely difficult, as most of the things you could order online were "some relatively niche gadgets". It was big news when you could order pizza off a website, but that was only in the United States and probably only in some places... I can't remember what he did to get calories but I remember it being interesting and I think it involved a website he found that sold cosmetics? It could very well be I am mixing this story up with something else :(. But like, it isn't as if the Internet was somehow universally useful from the very beginning... 1999 changed a lot, very quickly, but the Internet was already something even normal people could access for a number of years before then.
Yeah it's just gambling. My coworker explained to me what he does with crypto it's just "investing" it's not a currency to him at all. But it's also not an investment after you hear him explain his reasoning, it's just gambling
Exactly. Any reasonable person who sees crypto for what it is (gambling) doesn't touch it other than making trades in an order book on some exchange - treating BTC just like they would EUR, AAPL, etc.
It is simple to store and secure your cryptocurrency in a cold wallet.
1) Buy a Ledger* for $80
2) Make new 24 word passphrase and memorize it.
3) Copy your deposit address.
4) Reset the Ledger.
Hot wallets are harder and should never be more that 1-10% of your holdings. Most are safe using a combination of lit exchanges, like Coinbase and a phone wallet for their spending money.
It’s doable, e.g. you could take the names of twelve months in two languages; maybe even backwards and interspersed.
Still, the challenge is to live with that long term.
E.g. to not write it down. Or to write it down in a sufficiently cryptic way. But not too cryptic because you still need to remember it. Also you shouldn’t reuse this system. And every now and then you should check that it continues to work as you expect. And…
> you could take the names of twelve months in two languages
For the unlikely case that you're not trolling: Don't do this. You're gonna end up on the list of people that had their very clever brainwallets drained sooner or later.
Let alone that a BIP39-compliant wallet wouldn't even accept words not on the canonical word list.
Oh, thanks for the reply and sorry for the accusation then.
Well, just to reiterate – if you need to hold crypto, and if you're doing self-custody for it (no recommendation for either), don't come up with your own recovery phrase. Use a reputable wallet (again, I won't recommend one here) and make sure you have a backup plan that works, ideally offline and in multiple locations. And to reiterate: Even doing that, people lose their funds all the time. Opsec is hard, doubly so when literal money is at stake.
The human mind is quite bad at true randomness, but very good at coming up with puzzles that it perceives to be unsolvable (but that others can crack trivially).
You just described a serious of steps the average person has no chance of completing. The average person also makes mistakes, forgets things, and loses stuff. In fact, everyone does.
Ledger fails, gets lost, etc? Sorry, all gone. With the financial system outside of crypto I could lose everything I own in a house fire, get a government ID back, and walk into a bank and walk out with a debit card in minutes. Same thing applies if I get brain damage (`rm -rf /`) and forget how to do anything, or you know, simple stuff like dying unexpectedly and handling this in very straightforward means within the existing legal and financial system.
People make mistakes and these things (and more) happen in the real world. I swear this entire space is made of up aliens because they don't understand anything about humans or the real world.
These kinds of counter-arguments from those in the space only further prove my point.
These "problems" are only relevant to speculators. A normal person is not going to have $870K in cryptocurrency. Even a rich person is not unless they're speculating because they would otherwise hold their wealth as some kind of ordinary investment.
You might lose your cryptocurrency wallet with $50 in it, but you could just as well lose your traditional wallet with $50 cash in it.
The biggest impediment to adoption is actually regulatory. Vendors would love to accept a payment method with the transaction fees of Bitcoin Cash instead of the transaction fees of Visa and MasterCard. But not if it's ten thousand times more tax paperwork. Which competing payment methods might have had something to do with.
> A normal person is not going to have $870K in cryptocurrency. [...] You might lose your cryptocurrency wallet with $50 in it, but you could just as well lose your traditional wallet with $50 cash in it.
You're implying that people would only "invest" trivial amounts into cryptocurrency that they can afford to lose – and I unfortunately doubt that.
I don't doubt that there are some crypto users that really use it as a payment method (and then yes, who would hold more than $50 in USDC or whatever in their wallet when their bank account pays 4-5% interest right now!).
But the vast majority of people seem to be using it in a way that at least expects some incidental windfall by the price going up, if not outright as a poorly-understood investment vehicle.
If you're "investing" in something like this you're a speculator. That's fine, adults can go to the casino if they please, but if you place a bet and lose you don't get to ask for your money back. You can also take a hundred thousand bucks in gold bullion home with you to stick under your mattress. Play stupid games, win stupid prizes.
But nobody is forcing anybody to do that. And if you don't, you could still use it as a currency without having to worry about what happens to risk tolerant speculators/idiots.
> Vendors would love to accept a payment method with the transaction fees of Bitcoin Cash instead of the transaction fees of Visa and MasterCard.
Vendors love to accept what their customers pay them with.
Bitcoiners, etc still regularly post Twitter and forum posts when they find some random mom and pop store somewhere that actually takes BTC. Literally on the frontpage of the reddit bitcoin sub right now:
YES! So much adoption it's still a novelty worth putting on the internet!
If customers were asking to pay with BTC they would figure out a way to take it. Except customers don't so they don't because other than a tiny number of crypto zealots this space isn't anything other than something you gamble with.
Customers don't because the IRS is ridiculous, presumably on purpose.
If you sell cryptocurrency for more than you paid for it you have a capital gain. Okay, sure, if you made a million dollars then you owe taxes on a million dollars. But things like this commonly have exemptions for small transactions. If you pay for a $2 cup of coffee and had a capital gain of $0.03 for which you might owe less than one half of one cent in tax, it's obviously inefficient to require reporting for this. And it tends to even out because nobody is going to report a $0.03 capital loss either. So it makes sense to exempt transactions below some threshold. But for this they apparently don't. Which is hard to explain outside of malice.
And then people say "well nobody wants to use it."
> Customers don't because the IRS is ridiculous, presumably on purpose.
I have mixed feelings about the IRS too but people need to remember they are chartered to enforce the law as it is defined. The SEC and IRS has interpreted (IMO correctly) that according to current law and regulations crypto transactions are a taxable event as you describe. What you're not understanding is that many people actually appreciate this handling of crypto because of the benefit under current capital gains regulations (long-term capital gains). Another fundamental conflict in what crypto is and isn't, what the crypto community wants it to be, etc.
It's yet another one of those "crypto people don't understand the world as it is". They are trying to bend the world to them and not the other way around. It's not working and it never will. You're never going to have what is essentially product market fit if you live in an alternate universe like the crypto community.
> So it makes sense to exempt transactions below some threshold. But for this they apparently don't. Which is hard to explain outside of malice.
Contrary to popular belief in the crypto community there isn't some cabal scheming to "keep crypto down" or any such nonsense as we can see now by the traditional investment community trying to offer bitcoin ETFs, etc. It's an asset and even though the cryto community falls back to "it's about the tech", "save the world", etc in a bear market we all know they're actually all about gambling in fiat. Wait for a bull market for "have fun staying poor" and endless posts about the value in fiat to come back in full force. If anything it's just another thing to provide tax revenue to the US Treasury. They don't care what you're trading as long as you follow the tax code.
With the scheme you have described there are obvious avoision loopholes, such as people avoiding taxable events altogether by just executing all of their trades in amounts under the threshold. Then what do you do, come up with some complicated scheme to define it under total transaction amount in a year for a given entity? This will then be abused because there are all kinds of things you can do to game that. If such a legal framework were implemented I guarantee the next product from exchanges would be schemes to avoid taxation to automatically execute trades to fit your loophole.
The other issue is knock-on effects - this regulation would have to apply evenly across other asset classes as any language to specifically exempt crypto would also be nebulous and very gameable. Why should crypto have a fundamental tax advantage over other asset classes? The tax code is already a byzantine mess and this would only add to that.
> And then people say "well nobody wants to use it."
It's clear people don't want to use it, they want to gamble. There are and have been "pro-crypto" politicians but the number of voters who support this are the tiny handful of crypto zealots that don't remotely move the needle in an election. Crypto doesn't get votes because the vast majority of people see it for what it is - a toy to gamble with and once again the actual adoption numbers, demand, etc reflects that.
> I have mixed feelings about the IRS too but people need to remember they are chartered to enforce the law as it is defined.
The issue is that they're classifying it as an investment instead of a currency but the rules for investments make in impractical to use as a currency.
Conceivably this could be better suited to new legislation, but it's not obvious that they couldn't have done something more sensible, such as treating large holdings as investments and small holdings as currency.
> we can see now by the traditional investment community trying to offer bitcoin ETFs, etc.
Banks will do whatever makes them money. Offering ETFs of any kind where they get a vig makes them money. Replacing existing payment networks where they currently get $0.30 + 2.9% with new ones where the transaction fees are lower and go to someone else costs them money.
> With the scheme you have described there are obvious avoision loopholes, such as people avoiding taxable events altogether by just executing all of their trades in amounts under the threshold.
This is not a new problem. There is a $200 personal exemption for foreign currency. If you have a million dollars worth of Euros and the Euro is up against the dollar and you execute 5025 separate trades of Euros for US dollars in the amount of $199 each, what do you imagine happens?
> The other issue is knock-on effects - this regulation would have to apply evenly across other asset classes as any language to specifically exempt crypto would also be nebulous and very gameable.
It would be great to be able to use fractional shares of market ETFs as a global digital currency too.
> It's clear people don't want to use it, they want to gamble.
The gamblers want to gamble. I'm still not clear on why a global digital payments system with lower transaction fees than credit cards should have no market in a non-adversarial regulatory environment. That seems like something people would want.
International wire transfer scams are still somewhat common. The amount of convicted perpetrators is surprisingly low.
The best tool we have against them is prevention. In practice, this usually means a friendly bank employee refusing to honor a customer's wire transfer. Because once the money is sent, there's no getting it back.
In fact, all else equal, I'd rather have crypto stolen by someone else in my home country than to have fiat currency stolen by an international thief. At least with the domestic criminal there's some chance of tracing the theft, tracking them down, and bringing them to justice in my home justice system. With the international thief, there's really zero chance of that.
Russ Hanneman in the series Silicon Valley, whose character is loosely based on Mark Cuban, also lost a bunch of crypto when his cleaning lady mistakenly threw away his hardware wallet.
I don't understand storing crypto in an online wallets or exchange. To me, it's the equivalent of keeping gold bricks in your car in a public parking lot. Exchanges and online mixing/wallet points should only be used for ephemerally for transactions.
Generate your own wallet and keep it completely offline.
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[ 20.1 ms ] story [ 1091 ms ] threadRugpulls and ponzi schemes
Crypto really feels like a speed run of human monetary history.
Which money are you talking about? Most monies are driven substantially by monetary policy and other direct government intervention. The very reason fiat is no longer finite is due to government intervention in the 1930s (going off the gold standard).
Bitcoin (e.g.) is actually much more like gold in that the amount of it in circulation isn't determined by any law, policy or intervention.
If someone alters the amount of bitcoins out there, my wallet software won't recognize those bitcoins as legitimate.
What it is, as a project, is being extremely conservative, but that's a human political value, not a property of a technical system.
It's quite interesting in an economic sense too because, unlike our USD2 analogy, in the Bitcoin world users actually keep all their money in both forks (so if you have $1000 in USD, you'd also have $1000 in USD2) yet disproportionately favor one currency to the point that e.g. Bitcoin Cash is worth $217 per coin, while BTC mainline is worth $26,000 per coin.
The forks were the result of a split in the community. Not every change actually results in a fork.
This is even more true if one considers that after we defaulted on our obligations under Bretton Woods, we almost immediately transitioned to the petro dollar, making the USD the only way to obtain the most in-demand commodity in existence. So it still kind of had a backing. We've only really started to become 'free floating' extremely recently as more major oil producers turn against the petrodollar. And it doesn't seem to be leading to happy places.
[1] - https://wtfhappenedin1971.com/
[2] - https://en.wikipedia.org/wiki/Bretton_Woods_system
...Except for all the other major fiat currencies that are not USD.
If you look at countries by debt to GDP, the US is peers with economies like Laos, Sudan, Italy, Venezuela, and so on. [1] The unique position of the dollar alongside being the largest consumer economy gives the government immense room to absorb economic blunders. At least until the house of cards collapses, which will make 1929 look like the good ole days. This is one of the many reasons people are interested in currencies that cannot be manipulated outside of normal market forces.
[1] - https://en.wikipedia.org/wiki/List_of_countries_by_governmen...
How so? Bitcoin is a set of political/economic ideas about money encoded into software by a group of humans, who are historically known to sometimes change their minds over time.
Every fork happens in order to effect some change – and whether that change is beneficial or not is the matter of policy, not technology.
Voting against a fork (with your mining power or wallet) is also a policy decision. You can't escape human nature in a system built and used by humans, not even in a very conservative/change-averse one, because conservatism is, once again, a human value, not a technological one.
Through backwards-compatible soft forks.
Nobody removed the ability to make non-segwit transactions. SegWit did not change the existing transaction format or change the chain, it repurposed the "anyone-can-spend" transaction space.
Unlike with a lot of other cryptocurrencies, the Bitcoin dev team bends over backwards to try to make sure their protocol updates extend the existing protocol rather than changing it.
And most critically neither issuance nor balances have been changed, with the exception of the isolated value overflow error that was corrected during Bitcoin's infancy in 2010.
> Every fork happens in order to effect some change – and whether that change is beneficial or not is the matter of policy, not technology.
It's a matter of individual opinion. And with Bitcoin, every individual user can assert their own opinion by running the protocol version that aligns most with their own opinion. You can't opt out of your bank's software update.
> Voting against a fork (with your mining power or wallet) is also a policy decision. You can't escape human nature in a system built and used by humans, not even in a very conservative/change-averse one, because conservatism is, once again, a human value, not a technological one.
I can't argue with that. Being a bitcoin user is inherently a policy decision.
Everyone makes a policy decision by clicking the "download" button. It's part of Bitcoin's strength and it's part of Bitcoin's weakness.
Therefore the point of faster settlement and less burocracy doesn’t stand unless you are selling weapons, which proves that Bitcoin is only useful for criminal schemes.
> (instead of the awful SWIFT)
SWIFT is a real-time messaging network.
International transactions being slow has almost nothing to do with legacy technologies – it's partially outdated processes (batch processing facilitates netting, and netting preserves liquidity!), but overwhelmingly that we (or at least the regulators making the rules) want them to be slow enough to be able to intervene in case of financial crimes.
> my phrases on paper and USB locked in safes separated by 2000 miles
That's nice (unless you lose access to both or make some other operational mistake), but literally the opposite of central crypto custody, which is what this thread is about.
> Banks are here to stay, even in crypto imo
[0] https://news.ycombinator.com/item?id=37268750
Crypto, perfect, as long as you don't have too much money.
"Be a small target and hope for the best" is about the weakest form of security and does not instill a lot of comfort or confidence.
Maybe that takes smarts, but not a kind I value.
- "Not your keys, not your coins" very frequently turns into "your keys, some scammers coins". Or "your keys, not your coins and no ones coins" when you lose access to a wallet by losing the private key, seed phrase, etc. Look around forums, subreddits, twitter, etc... These people expend tremendous amounts of time and energy just trying not to lose everything forever.
- Your other option is hosting them with custodians that have frequently proven to be anywhere from incompetent/reckless to outright criminals.
Time and time again individuals who are significantly more technical and astute than the general population STILL fall victims to both of these scenarios and many, many more.
Almost 15 years after the launch of bitcoin and at least tens of billions of dollars invested in development in the space there is still nowhere on the horizon any of this is ready for anything approaching mass adoption.
Other than the basic human trait of greed and gambling, get rich quick schemes, criminal and nefarious purposes, etc I have no idea how any of this is still a "thing".
I think you asked and answered your own question. It's still "a thing" because people still speculate on it. In particular, people gamble on it being more of "a thing" in the future.
You hit the nail on the head. Nobody can directly buy water, milk, fuel, transportation, or anything necessary with bitcoin. Its only legitimate use is an exotic and volatile investment vehicle for millionaires to play with.
Fun fact: Technically, you could buy $50 dollars of groceries with an American Gold Eagle. You'd definitely confuse the cashier though.
Don’t they?
Perhaps not quite "water, milk, fuel, transportation, or anything necessary" but certainly far from "an exotic and volatile investment vehicle for millionaires to play with".
[1] https://en.m.wikipedia.org/wiki/Nasubi
And yes, I'm talking about using it on the grocery store.
Does that mean stablecoins should be discontinued because it's not mass adopted at all? even if it's useful for a minority? I disagree
It is simple to store and secure your cryptocurrency in a cold wallet.
1) Buy a Ledger* for $80
2) Make new 24 word passphrase and memorize it.
3) Copy your deposit address.
4) Reset the Ledger.
Hot wallets are harder and should never be more that 1-10% of your holdings. Most are safe using a combination of lit exchanges, like Coinbase and a phone wallet for their spending money.
You are GREATLY exaggerating the compelxity.
* https://shop.ledger.com/products/ledger-nano-s-plus/ruby-red
What are you rain man?
It’s hard to know what approach to pick, or even which source to trust, especially when you’re starting.
And it’s extra hard to continuously manage and improve your security; even moving coins to cold storage.
Single-shot memorizing 24 words is utterly out of the question for almost everybody.
Still, the challenge is to live with that long term.
E.g. to not write it down. Or to write it down in a sufficiently cryptic way. But not too cryptic because you still need to remember it. Also you shouldn’t reuse this system. And every now and then you should check that it continues to work as you expect. And…
For the unlikely case that you're not trolling: Don't do this. You're gonna end up on the list of people that had their very clever brainwallets drained sooner or later.
Let alone that a BIP39-compliant wallet wouldn't even accept words not on the canonical word list.
Well, just to reiterate – if you need to hold crypto, and if you're doing self-custody for it (no recommendation for either), don't come up with your own recovery phrase. Use a reputable wallet (again, I won't recommend one here) and make sure you have a backup plan that works, ideally offline and in multiple locations. And to reiterate: Even doing that, people lose their funds all the time. Opsec is hard, doubly so when literal money is at stake.
The human mind is quite bad at true randomness, but very good at coming up with puzzles that it perceives to be unsolvable (but that others can crack trivially).
How easy! Just have an Eidetic memory,
And I prefer vi, or now vim tiny.
Ledger fails, gets lost, etc? Sorry, all gone. With the financial system outside of crypto I could lose everything I own in a house fire, get a government ID back, and walk into a bank and walk out with a debit card in minutes. Same thing applies if I get brain damage (`rm -rf /`) and forget how to do anything, or you know, simple stuff like dying unexpectedly and handling this in very straightforward means within the existing legal and financial system.
People make mistakes and these things (and more) happen in the real world. I swear this entire space is made of up aliens because they don't understand anything about humans or the real world.
These kinds of counter-arguments from those in the space only further prove my point.
You might lose your cryptocurrency wallet with $50 in it, but you could just as well lose your traditional wallet with $50 cash in it.
The biggest impediment to adoption is actually regulatory. Vendors would love to accept a payment method with the transaction fees of Bitcoin Cash instead of the transaction fees of Visa and MasterCard. But not if it's ten thousand times more tax paperwork. Which competing payment methods might have had something to do with.
You're implying that people would only "invest" trivial amounts into cryptocurrency that they can afford to lose – and I unfortunately doubt that.
I don't doubt that there are some crypto users that really use it as a payment method (and then yes, who would hold more than $50 in USDC or whatever in their wallet when their bank account pays 4-5% interest right now!).
But the vast majority of people seem to be using it in a way that at least expects some incidental windfall by the price going up, if not outright as a poorly-understood investment vehicle.
But nobody is forcing anybody to do that. And if you don't, you could still use it as a currency without having to worry about what happens to risk tolerant speculators/idiots.
Vendors love to accept what their customers pay them with.
Bitcoiners, etc still regularly post Twitter and forum posts when they find some random mom and pop store somewhere that actually takes BTC. Literally on the frontpage of the reddit bitcoin sub right now:
https://www.reddit.com/r/Bitcoin/comments/16k82kk/bitcoin_ac...
YES! So much adoption it's still a novelty worth putting on the internet!
If customers were asking to pay with BTC they would figure out a way to take it. Except customers don't so they don't because other than a tiny number of crypto zealots this space isn't anything other than something you gamble with.
If you sell cryptocurrency for more than you paid for it you have a capital gain. Okay, sure, if you made a million dollars then you owe taxes on a million dollars. But things like this commonly have exemptions for small transactions. If you pay for a $2 cup of coffee and had a capital gain of $0.03 for which you might owe less than one half of one cent in tax, it's obviously inefficient to require reporting for this. And it tends to even out because nobody is going to report a $0.03 capital loss either. So it makes sense to exempt transactions below some threshold. But for this they apparently don't. Which is hard to explain outside of malice.
And then people say "well nobody wants to use it."
I have mixed feelings about the IRS too but people need to remember they are chartered to enforce the law as it is defined. The SEC and IRS has interpreted (IMO correctly) that according to current law and regulations crypto transactions are a taxable event as you describe. What you're not understanding is that many people actually appreciate this handling of crypto because of the benefit under current capital gains regulations (long-term capital gains). Another fundamental conflict in what crypto is and isn't, what the crypto community wants it to be, etc.
It's yet another one of those "crypto people don't understand the world as it is". They are trying to bend the world to them and not the other way around. It's not working and it never will. You're never going to have what is essentially product market fit if you live in an alternate universe like the crypto community.
> So it makes sense to exempt transactions below some threshold. But for this they apparently don't. Which is hard to explain outside of malice.
Contrary to popular belief in the crypto community there isn't some cabal scheming to "keep crypto down" or any such nonsense as we can see now by the traditional investment community trying to offer bitcoin ETFs, etc. It's an asset and even though the cryto community falls back to "it's about the tech", "save the world", etc in a bear market we all know they're actually all about gambling in fiat. Wait for a bull market for "have fun staying poor" and endless posts about the value in fiat to come back in full force. If anything it's just another thing to provide tax revenue to the US Treasury. They don't care what you're trading as long as you follow the tax code.
With the scheme you have described there are obvious avoision loopholes, such as people avoiding taxable events altogether by just executing all of their trades in amounts under the threshold. Then what do you do, come up with some complicated scheme to define it under total transaction amount in a year for a given entity? This will then be abused because there are all kinds of things you can do to game that. If such a legal framework were implemented I guarantee the next product from exchanges would be schemes to avoid taxation to automatically execute trades to fit your loophole.
The other issue is knock-on effects - this regulation would have to apply evenly across other asset classes as any language to specifically exempt crypto would also be nebulous and very gameable. Why should crypto have a fundamental tax advantage over other asset classes? The tax code is already a byzantine mess and this would only add to that.
> And then people say "well nobody wants to use it."
It's clear people don't want to use it, they want to gamble. There are and have been "pro-crypto" politicians but the number of voters who support this are the tiny handful of crypto zealots that don't remotely move the needle in an election. Crypto doesn't get votes because the vast majority of people see it for what it is - a toy to gamble with and once again the actual adoption numbers, demand, etc reflects that.
The issue is that they're classifying it as an investment instead of a currency but the rules for investments make in impractical to use as a currency.
Conceivably this could be better suited to new legislation, but it's not obvious that they couldn't have done something more sensible, such as treating large holdings as investments and small holdings as currency.
> we can see now by the traditional investment community trying to offer bitcoin ETFs, etc.
Banks will do whatever makes them money. Offering ETFs of any kind where they get a vig makes them money. Replacing existing payment networks where they currently get $0.30 + 2.9% with new ones where the transaction fees are lower and go to someone else costs them money.
> With the scheme you have described there are obvious avoision loopholes, such as people avoiding taxable events altogether by just executing all of their trades in amounts under the threshold.
This is not a new problem. There is a $200 personal exemption for foreign currency. If you have a million dollars worth of Euros and the Euro is up against the dollar and you execute 5025 separate trades of Euros for US dollars in the amount of $199 each, what do you imagine happens?
> The other issue is knock-on effects - this regulation would have to apply evenly across other asset classes as any language to specifically exempt crypto would also be nebulous and very gameable.
It would be great to be able to use fractional shares of market ETFs as a global digital currency too.
> It's clear people don't want to use it, they want to gamble.
The gamblers want to gamble. I'm still not clear on why a global digital payments system with lower transaction fees than credit cards should have no market in a non-adversarial regulatory environment. That seems like something people would want.
Mark Cuban loses $870k to a crypto scam: ‘They must have been watching’ https://www.dlnews.com/articles/people-culture/mark-cuban-lo...
The best tool we have against them is prevention. In practice, this usually means a friendly bank employee refusing to honor a customer's wire transfer. Because once the money is sent, there's no getting it back.
In fact, all else equal, I'd rather have crypto stolen by someone else in my home country than to have fiat currency stolen by an international thief. At least with the domestic criminal there's some chance of tracing the theft, tracking them down, and bringing them to justice in my home justice system. With the international thief, there's really zero chance of that.
Generate your own wallet and keep it completely offline.