India seeks to block most cryptocurrencies in new bill, government says

https://www.reuters.com/world/india/new-indian-law-will-allow-only-few-cryptocurrencies-government-says-2021-11-23/

by shenoybr • 5 years ago

201 218 5 years ago

reuters.com

onemoresoop• 5 years ago

How are they going to be doing that? China seems to be banning all crypto every year.

zepto• 5 years ago

Quite successfully, it would seem.

endisneigh• 5 years ago

Easiest way would be to block exchanges. Though one could go to another country and withdraw and convert the money, the more countries that block exchanges, the more targeted one could be towards the remainder for money transfers.

sombremesa• 5 years ago

Wouldn’t that just lead to a black market? Especially in a country that loves its informal economy like India?

instagraham3• 5 years ago

It's not as easy to participate in the informal economy as it used to be. Everything from one's bank to one's mobile number and govt id are linked. If you want to deposit funds in an exchange, you'll need some form of KYC--barring which your bank debit/credit card is linked anyway.

The banks, even before the ban (which has yet to come), were keeping track of customers making payments to exchanges. In some cases, they customers a letter, erroneously citing an central bank order banning cryptocurrencies that had later been struck down by the Supreme Court. Despite no regulation, they've been denying services to exchange, preventing their cards or UPI payment addresses being used to transact either. Most mobile wallets followed suit.

The only option that remained then was P2P. I should caveat that I'm not sure I fully understand how that works in this case, though.

The issue is there's no real anonymous way to pay someone besides cash, unless you already had a crypto account with a wallet that had been filled. So an informal economy will need a safe way of turning physical cash into crypto and vice versa, in a regulatory environment where it may be banned to transact cryptocurrencies.

Crypto adoption is a gradual curve where people will only slowly start putting their savings or investment funds into a crypto account.

joe_the_user7• 5 years ago

If bitcoin is illegal, the only reason to engage in a black market transaction to obtain would be if it gave you access to material thing you could not otherwise get - unless there active hyper-inflation going on, no one would want to illegally obtain bitcoin just so they could turn around and buy some good they'd be able to obtain with normal, legal transaction.

ashwagary7• 5 years ago

This just speeds up the rise of Dexes. How do you block an exchange like Bisq in India?

betwixthewires7• 5 years ago

Well, they can try, but even with centralized exchanges, a VPN will do. And then there are decentralized protocols.

Once you have some of your money in cryptocurrency there's no real way for anyone to stop you from moving your money around however you like. The only points that can be controlled are interfaces with banks.

instagraham3• 5 years ago

The interfaces have almost been reduced to a couple of options: A single mobile wallet, or P2P.

A ban would force the wallet's company to stop allowing its use on crypto exchanges.

mathnmusic2• 5 years ago

Banks can block accounts of centralized exchanges (and have done so in the past when govt asked them to). And once conversion from and to fiat money is disabled, there's very little value left in cryptocurrency.

petilon• 5 years ago

Unless you want to spend the money abroad.

ProfessorLayton• 5 years ago

The only points that can be controlled are interfaces with banks.

That's... A big deal?

lottin5• 5 years ago

Yeah, well, basically they stop you from cashing out, which means your crypto-holdings are worth zero to you, whatever their market value.

betwixthewires7• 5 years ago

It is a big deal if you're only speculating and need to cash out. But if you can buy goods and services informally in these currencies, or use tools like stablecoins to speculate on network, it's really nothing to worry about.

joe_the_user7• 5 years ago

If it's illegal to exchange goods or official currency for cryptocurrency in the nation you are in, the usefulness of cryptocurrency is going to be considerably constrained. This depends on how thorough or draconian the state is but a lot of people just shy away from illegal activity without enforcement being that strong. After all, if buy a tangible good, I want legal title to it and having engaged in an illegal transaction to get the stuff makes that less certain.

santiagobasulto• 5 years ago

That is why drugs and other illegal things are so cheap, right?

joshgrib2• 5 years ago

This is an important point - I think a lot of us tech people like to think "no it only exists on the internet the govt can't touch it! It's like international waters!", but then you have countries that can completely restrict or shut down the internet. As long as the infrastructure exists in the real world and is controlled by a govt, then the "imaginary online stuff" is still ultimately under their control. Even in "the matrix" someone was still running all those computers and could turn them off if they wanted.

sMarsIntruder• 5 years ago

Wrong.

wyager2• 5 years ago

This isn't true if your objective is just to protect wealth long-term. If bitcoin is "banned" in India (you can't exchange it for INR on an exchange), you can still "use" it in the sense that you can acquire it illegally or overseas and then hold onto it. Your liquidity is limited but this is a small downside long-term.

csomar5• 5 years ago

This gets repeated a lot around here but is far from the truth. Drugs are still traded, and so are other "illegal" items. And trading drugs is quite risky comparing to trading crypto (especially fully decentralized).

usefulness of cryptocurrency is going to be considerably constrained

Sure, but you are missing why 3rd worlds like China, India and Morocco are trying to restrict crypto. They are worried about capital outflows. It's not a surprise most of these countries already have rigid capital controls. People who have decided they want to "outflow" their capital are not really worried about government restrictions.

ngokevin2• 5 years ago

How are you supposed to turn the coins into FIAT where it's actually usable?

At that point, you cannot move your money around however you like, you can only move the tokens around on the blockchain.

tiborsaas3• 5 years ago

Worst case is to buy some physical goods and sell it. A bit cumbersome, but not impossible.

ashwagary7• 5 years ago

Gift cards and p2p exchange for fiat using a dex or another service. As long as there is money to be made, the Indian crypto black market will thrive and grow.

jazzyjackson3• 5 years ago

not just banks, but everywhere you can spend it in country. fine you can move money between virtual accounts and buy NFTs all day, but government can control whether local business are allowed to accept your crypto as payment, so you’ll need to liquidate crypto into local currency - which kind of sucks to do if the banks aren’t there to help.

xtracto• 5 years ago

This hasnt been a problem forvseveral years. There are different options:

- buy international prepaid cards for legal dervices (bitrefill)

- use p2p local crypto exchanges: localcrypto, localmonero (in some countries this can be 100% anonymous by using the "withdraw from atm with 1 time code" bank services)

- Exchange to alternate "tokens" that are legal (anyone remembers Linden dollars to BTC market around 2010?)

- Exchange locally via sneakernet.

YetAnotherNick4• 5 years ago

Once you have some of your money in cryptocurrency

That is a pretty big condition. Most of the people who buy crypto wants to buy from some trustworthy site, and if that is stopped there will be effectively zero new crypto being brought inside the country. Also no one knows how much hassle will it be to convert it into money in bank, this is likely to stop almost all trades.

idiotsecant• 5 years ago

If they make owning crypto a crime it becomes just a matter of showing that you used it then they put you in a concrete box for a while.

Hooray_Darakian• 5 years ago

Enforcement doesn't have to be perfect to curtail major usage.

BitwiseFool2• 5 years ago

If you are willing to break the law and risk being caught, sure, there is no way to actually stop from transacting using decentralized protocols. But there are plenty of other ways for the government to find out whether or not you are using crypto. Your bank will definitely keep tabs on your fiat transactions and continue to report KYC/AML information. Current KYC/AML is actually pretty good at detecting anomalies in cashflow and spending. Sure, you can lie about all this stuff but you might just be digging yourself into a hole.

m00dy• 5 years ago

You can seek to block cryptocurrencies but you can't block decentralised protocols.

P.S: I'm someone important at LongShort.Finance

0des2• 5 years ago

P.S: I'm someone important at LongShort.Finance

What a peculiar addition to your comment.

dboreham2• 5 years ago

someone important

Everyone here is important.

ganeshkrishnan• 5 years ago

no uh. not me

pinneycolton• 5 years ago

I'm important, but my importance is fully decentralised. It means almost nothing :)

blntechie• 5 years ago

P.S: I'm someone important at LongShort.Finance

So I opened the site and it pretty much only asks me to connect to the wallet. No explanation of what it does, what it’s for etc. which are even standard in scam websites. They sure appears extremely scammy even though it might not be.

babyshake• 5 years ago

A good rule of thumb is that if someone says they are important, they are probably not important. The important people are the ones with nothing to prove to plebs like us.

refsab• 5 years ago

You know you could just post a Show HN if you wanted to promote your crypto thingy. No need to be so ridiculous about it.

TekMol7• 5 years ago

Tokens like Bitcoin, Eth, NFTs etc are the only thing one can own in the digital space.

So if a country makes the possession of cryptocurrencies illegal, it makes their people digitally possessionless.

This would cut them off from the next version of the web. Similar to how North Korea cuts of their people from the current web.

So far it seems no country that cuts of their people from the internet has been able to flourish.

joe_the_user7• 5 years ago

Why is that a problem? I "possess" nothing in digital space but get much value from it and I posses various things in meat-space that I also get value from.

Moreover, I can spend my conventional money in digital space and get further use from. A "digital possess" seems a thing that doesn't improve the world in a good way.

TekMol7• 5 years ago

In the 90s many people said the same thing about "being online" and "having email". Writing letters and meeting in person works just fine, they said.

Crypto makes so many things so much more efficient that not having access to it will be like not having access to the internet today.

rollcat2• 5 years ago

All ownership (digital or not) is nothing but a social contract. The cryptocurrency (or normal currency) exists because enough people agree to recognise it.

You can buy and own a domain name. If trust in DNS is violated, we'll have much bigger problems.

TekMol7• 5 years ago

Owning a token means you can perform certain actions on a distributed system. No social contract needed. You own the token by owning a secret key which gives you the power to move it.

It's like owning a key to a door. It gives you the power to lock and unlock the door. No social contract needed.

You can not own a domain. You can only pay a registrar to have them talk to a registry. You then are at the mercy of both. Use the HN search tool to read an endless amount of horror stories of people who lost domains and sometimes decades of work because of this.

0des2• 5 years ago

Bitcoin is not a token.

TekMol7• 5 years ago

Google "native token of the bitcoin network".

Tepix3• 5 years ago

When you own property in real life the record of ownership is maintained by the city/state/country.

There's no reason why the ownership in digital space has to be on a decentralized blockchain, you can also record it centrally (as shown by trusted entities like VISA etc).

TekMol7• 5 years ago

    When you own property in real life the record of
    ownership is maintained by the city/state/country.

And the people of Turkey lost over 80% of their savings buying power because of this.

shubhank19• 5 years ago

The article seems a little misguided. The news was "private cryptos", not all cryptos.

givemeethekeys• 5 years ago

Would this would apply to a coin that a company would issue outside of the controls of a regulatory body vs. bitcoin, which is decentralized?

vmception• 5 years ago

but the layer 1 cryptos are all moving towards private

even bitcoin’s taproot amendment that just got passed and implemented does this to a limited extent

radicaldreamer• 5 years ago

This is about the 12th time that India has "banned" cryptocurrencies. Don't believe it...

dboreham2• 5 years ago

Crypto industry must not be contributing enough to politicians, like they seem to do in the US.

charlesju• 5 years ago

They need to sponsor more sports teams

rip_netrunner3• 5 years ago

And yet, the uniformed masses seize upon the news every time as proof that crypto is doomed.

SpaceManNabs2• 5 years ago

More of a reason for Polygon to go succeed with their zk plans.

k__2• 5 years ago

Would you mind to elaborate?

Tepix3• 5 years ago

In cryptography, a zero-knowledge proof or zero-knowledge protocol is a method by which one party (the prover) can prove to another party (the verifier) that a given statement is true, without conveying any information apart from the fact that the statement is indeed true.

You can build untraceable anonymous cryptocurrencies using these algorithms.

realce• 5 years ago

People are pretty arrogant around here, but we're reaching the next phase of crypto: Government Competition. The current crypto ecosystem is probably allowed so the tech can flesh out organically, then the best bits and bobbles will be plucked for inclusion in official government-approved currency. What State wants to be the guinia pig for any of this stuff - your whole country could collapse. Let people figure it out and give them all the risk, the State can take over later.

Other coins will be considered exclusive pathways for money laundering and will be nerfed like bearer-bonds or precious metals are in the US.

There's no actual resource - violent or material - that backs any crypto. The only backing is it's novelty. Once the novelty is copied by the State, it will be rubbed out IMHO.

cletus• 5 years ago

Crypto is increasingly looking like a Ponzi scheme to me. I know this is going to be an unpopular opinion on HN but it's no less true.

The fact is that blockchain solves a problem for almost nobody. The primary use seems to be to avoid real or threatened government intervention. These uses are largely illegal, by definition (eg bypassing capital controls in China). Now you can argue the morality of such laws but that's irrelevant.

Cyrptos have wildly failed as a "currency". Even so-called "stablecoins" just peg themselves directly or indirectly to fiat currencies so they're really just adding another point-of-failure. We should be calling them "cryptoassets" not "cryptocurrencies".

As for escaping government seizures and the like, try telling that to Ross Ulbricht [1]. This year, China started to crack down on crypto mining [2].

The "security" of crypto is a myth. They can and have forked and have well-known weaknesses (eg 51% attack). I can't help but think of this [3] wrt security.

Proof-of-work wastes a ton of energy for basically nothing and, just like China, countries will increasingly clamp down on this, especially as voters increasingly face rising energy costs.

Proof-of-stake is basically a fantasy of how we'll solve PoW problems with a lot of hand-waving. It having not happened yet is pretty good evidence of this being a fantasy.

All it really takes is for action by the US and/or EU to say something like "financial institutions who trade in cryptos lose access to the banking system" and the market implodes. Sure the government can't stop you adding more transactions to the blockchain but for what? If no one can take your "currency" what value does it have?

Weirdly, crypto has seen the resurgence of gold bugs who have long held an irrational hatred for fiat currencies, completely with false claims in some cases (eg the US dollar was never 100% backed by gold, ever).

Things like reversible transactions and the ability to print money are actually a feature not a negative as they're often portrayed.

And even if you get past all this, you want users to securely manage a wallet when failure to do so means they could be irreversibly be robbed of their balance?

Governments are slow to react and they tend to only react to things that become viewed as a threat. Crypto is so niche it's not a threat. But that doesn't mean the US government couldn't fatally wound the crypto market tomorrow if it chose to.

[1] https://en.wikipedia.org/wiki/Ross_Ulbricht

[2] https://www.nytimes.com/2021/09/24/business/china-cryptocurr....

[3] https://xkcd.com/538/

lordnacho• 5 years ago

Unpopular? What you've written is a summary of the orthodoxy on HN.

xwdv• 5 years ago

When people say it’s an “unpopular opinion” it’s really a dog whistle for supporters to come out and agree.

TrinaryWorksToo• 5 years ago

How is fiat money not a ponzi scheme?

romeros• 5 years ago

This is really a popular opinion on HN. It is kind of self evident too.

Defi, NFT, Crypto all have Ponzi features. The people who win are early investors and the ones who lose are those who are late to the game. So, we invent "new" schemes like NFT, Defi etc.

There is no product. Nobody uses Defi to "borrow". 99.999% of the people want to put their crypto in and magically get some crazy XY.ABC% APR on their crypto. Everything runs on greater fool theory.

When the bear market hits there will be a lot of bag holders wondering why the hell they paid $10k on a monkey pic with sunglasses and a cigar.

During the euphoria phase people act like they are misunderstood geniuses and people who rightly call this a ponzi scam are those who don't get "it"!

iskander8• 5 years ago

Nobody uses Defi to "borrow".

I mostly "use" crypto to keep USDC in DeFi sites like Aave for ~3-10% APY and some on Gemini for a FDIC insured 8% APY. This money primarily gets lent out for other people margin trading, but you don't really need to take on any of that risk for yourself.

Zamicol6• 5 years ago

Proof-of-stake is basically a fantasy [...] hand-waving. It having not happened yet is pretty good evidence of this being a fantasy.

This couldn't be further from reality. Blackcoin (2014), Peercoin, Decred, etc...

Eth 2.0 is running, right now, with billions in value. The whole of Eth is planned to move to 100% PoS quarter 1 of 2022.

IceWreck• 5 years ago

The whole of Eth is planned to move to 100% PoS Quarter 1 of 2022

I have heard this so so many times. ETH moving to PoS fully in X months. I'll believe it when it happens.

And I'm glad they plan on making it happen cause there way too many things harming the environment already. A major cryptocurrency reducing their environmental impact is welcomed.

iskander8• 5 years ago

The rest of your post is a very standard HN response to crypto, to the point where I'm not even sure if you wrote it or copied it.

I just want to respond to this:

Proof-of-stake is basically a fantasy of how we'll solve PoW problems with a lot of hand-waving. It having not happened yet is pretty good evidence of this being a fantasy.

PoS is bog standard for new chains. Every "up and coming" chain is essentially a clone of Ethereum with some scalability improvements and proof-of-stake for consensus. See: Harmony, Luna, Avalanche, &c

masa331• 5 years ago

Another thing is the more people will use crypto the more they will actually want it to be regulated. The more money there is more guarantees will holders want. And it will slowly turn into the same currencies we now have - centralized, regulated, traceable, stable. What an irony for crypto fans

yashg3• 5 years ago

Not unpopular. Programmers who can understand the underlying technology and look beyond the lofty ideological BS of blockchain will immediately know, this will not work in real world scenarios.

I tried to find any company who was using blockchain in any meaningful way. I couldn't find any. All I could find was promotional pieces mentioning what COULD BE DONE with blockchain or a trial that some big name company was CONSIDERING. No updates on the results of those trials or if anyone actually carried out the trial.

Proof-of-worrk blockchain is such a terrible, wasteful and bad concept that anyone who has ever worked with any database would know it's not even close o being useful.

seaourfreed• 5 years ago

Don't tell the Indian government where Polygon chain / MATIC came from.

largbae• 5 years ago

First they ignore you... then they laugh at you... then they _fight_ you....

seaman19212• 5 years ago

and then you lose :)

iskander8• 5 years ago

An interesting angle that seems overlooked in articles about India and China "banning" cryptocurrencies is that these efforts are often linked to a desire to create centralized digital currencies.

e.g. from this article: "India is also looking to make a framework for the official digital currency that will be issued by the Reserve Bank of India."

trasz• 5 years ago

Ie creating something that could be useful as an actual currency?

RealityVoid• 5 years ago

I find it amusing the baked in assumption of your post that currencies can only be real if they are backed by a state. I think that is... No necessarily true. Just because something held up for a long time does not mean there is some essential reason why things can't be another way.

That holds true of a lot of human innovations. People could not imagine automobiles or flying or computers, but that did not make them impossible.

iskander8• 5 years ago

It would definitely have a lot more buy-in from banks if it were centrally sanctioned but I'm not sure if the functionality would be much different from a stablecoin on an efficient L2. I would personally rather have banks integrate with e.g. USDC on zkSync but I suspect that the lack of control is what makes that scenario undesirable for governments.

rufusroflpunch• 5 years ago

It's 100% about CBDC's. CBDC's are the endgame for tyranny, really. We should be doing absolutely everything we can to fight this.

spiralx7• 5 years ago

How are CBDCs the "endgame for tyranny" in a way that (presumably) fiat currencies or cryptocurrencies aren't? Seems a bit hyperbolic, but maybe you have good reasons to be so alarmed.

spiralx7• 5 years ago

Do you have evidence that "a desire to create centralized digital currencies" has anything to do with "banning cryptocurrencies"? Because lots of countries have expressed interest in CBDCs and most of them aren't talking about banning anything. Indeed, it's often central banks talking about CDBCs, which aren't even in the position of banning anything.

Seems to me that CDBCs are just the new topic for conspiracies about how cryptocurrencies are being held back by the Powers That Be.

iskander8• 5 years ago

The two are often juxtaposed in the coverage of crypto bans, I don't know if they're also juxtaposed in the political intentions.

gvv• 5 years ago

Load ze India FUD ...

sekura• 5 years ago

Looking at "India's first crypto Unicorn" you wouldn't know that government is planning to block anything.

https://coindcx.com

nathias• 5 years ago

let's make a cricket DAO

csomar5• 5 years ago

The discussions around crypto here kind of proves that you cannot use popular opinion in HN to predict the future. People were very negative (and still are) about crypto. Market cap kept proving them wrong year after year and we are here with around $2.6 Trillion and yet people here still think crypto is going to die.

It's interesting because in startups, you learn from the first day that you should listen to customers and follow the demand. The demand is very high and some people were puzzled how other people where depositing money in "shady" exchanges. Yet, that's a perfect example of "demand" that needs instruments to be satisfied.

Reality check: Most of the world suffers from hyper-inflation at worst and inflation at best. Not everyone lives in the USA/Europe and has access to good banking and investment options. Not everyone cares about their governments like in a developed first-world country.

Crypto is here to stay and it is going to play a significant role in global finance. Somebody here should read what the bureaucrats at the IMF thinks, or look at the roads in New Delhi. Gov. blocking crypto, yeah, right.

0xB31B1B3• 5 years ago

marketcaps in crypto mean nothing. The universe is full of wash sales, there is not 2.6T of liquidity, a ton of volume is insanely leveraged and amplified through defi pools, and looking at a transaction volume adjusted view of the world, like 99.9% of transactions are valueless gambling OR money laundering. Lets see what happens after the run on tether happens, then we can talk about what the crypto world looks like.

csomar5• 5 years ago

Even at 1/4 of that, it's $650bn. That's a tons of value.

like 99.9% of transactions are valueless gambling OR money laundering.

You need to prove that. GBTC and CME options volumes/open value are in the billions. I don't think people are laundering money through these instruments.

aeternum• 5 years ago

A more accurate statement would be that volume means nothing.

Market cap absolutely does. It's meaningful that of the 18.8mil btc out there, no one is willing to part with one for less than $56k.

Even the Tether concern is somewhat outdated. It now makes up only 4.5% of btc & eth's combined market cap. The mkt cap of btc and eth fluctuates about that much every few days, is it enough to really matter?

scottcodie6• 5 years ago

Inflation isn't bad. Most of the world doesn't suffer from hyper-inflation. Decentralized finance doesn't provide a tremendous benefit over a trusted third party. High volatility and high transaction cost makes it a poor choice for a currency. Most of the worlds economy already runs on digital transactions without the need for crypto. There are plenty of reasons why crypto doesn't make sense and it is perfectly rational to distance your financial market from crypto.

whb072• 5 years ago

Tell that to the retiree living on a fixed sum for life.

Of course inflation is bad you should see what $100 over 10 years at 2% inflation is.

Now try it for 6%+.

It’s the reverse compounding for savings people should strive for.

Who did you learn your basic economics from?

rfd4sgmk8u2• 5 years ago

Inflation is bad. Hyperinflation is worse. Reported CPI does not reflect actual inflation. One just needs to look at asset prices, stock prices, etc to see what is happening. You and everyone else is being robbed, every day, and it gets worse...

I strongly suggest you look into why people would want "censorship resistant, decentralized, non-state, peer to peer currencies". The existing financial system doesn't make sense. Stores of value outside the reach of the state is highly desirable. The ability to transmit value, trustlessly, anywhere on the planet via a communication channel is a breakthrough technology.

Who wants inflating, dirty, war promoting, state based fiat, when they can have deflating, clean, peace promoting, non-state based cryptocurrency?

daveed• 5 years ago

Most of the world suffers from hyper-inflation at worst and inflation at best. Not everyone lives in the USA/Europe and has access to good banking and investment options.

Real question - you mention earlier to "follow the demand". Is there evidence that demand for crypto is coming from countries with unstable banking?

inter_netuser5• 5 years ago

Yes. Page 7 in the document.

https://think.ing.com/uploads/reports/IIS_New_Tech_Cryptocur...

The more unstable the country, or higher inflation - the higher penetration.

I'm surprised people still ask these questions. It this not painfully obvious?

dufferzafar2• 5 years ago

Hi, I live in Delhi. New Delhi is one of 11 districts in Delhi.

Not sure if you meant "look at the roads in New Delhi" in a "derogatory" sense, but I'd just like to say that the roads in New Delhi are some of the best roads here.

kamaal• 5 years ago

>Not sure if you meant "look at the roads in New Delhi" in a "derogatory" sense

I live in Bangalore(Roads here are darn horrible) not Delhi, but instead of looking at this in an "derogatory sense", in all honesty what the person is actually right.

In the overwhelming number of issues facing India- Literacy rates, hunger, infrastructure, social crises, is crypto the biggest issue facing India?

thepasswordis• 5 years ago

So did the "China bans cryptocurrency" FUD wear off or something?

heywherelogingo• 5 years ago

If I'm not mistaken, the bitcoin price has been unaffected by this news - how does that work?

yashg3• 5 years ago

Bitcoin has crashed on the largest Indian exchange WazirX by 25%.

victoro• 5 years ago

Honest question I constantly think about and have never been able to answer about the future of cryptocurrency development: Why/when would a government ever want less control over the primary means used to transact within its borders?

This is one of the, if not the most, important levers it has to wield power. Governments have fought wars and enslaved entire continents to protect and increase the value of their means of account. Even recently, think of how hard the US works to maintain the dollar as the only currency that can be used international oil transactions aka the petrodollar.

Ultimately, cryptocurrency is a technological attempt to solve the problem of a fundamental lack of trust in our traditional institutions. After all, its powered by a set of de-centralized, trustless protocols. If you use crypto as an inflation hedge, that means you don't trust your government to not de-value your labor via printing tons of new currency. If you use it to carry out transactions, it means at least a small part of you has doubts that our that our current, centralized payment processing institutions won't unilaterally roll those transactions back or eliminate them outright in the future. Ditto for property rights and NFTs (and all the other use cases that guarantee a transaction is recorded by distributing it on chain).

Allowing crypto-currencies to supersede local currencies would not only put governments at the mercy of the mob (or perhaps a small number of whales and exchanges) for determining the value of their citizen's output, it would be an existential admission of their failure. Other than governments that have already failed at administering a currency like El Salvador, why would any self-respecting government with a functioning currency admit defeat like this?

seaman19212• 5 years ago

Agreed. As long as people make some quick profits, they will blindly support anything, even fight governments - even if that thing makes it easy for criminals to launder money.

It is going to be an interesting battle. I got my popcorn and enough fiat currency to survive whichever way this goes. In the worst case my plan is https://xkcd.com/538/

yashg3• 5 years ago

Majority of the people who gamble on crypto are doing so only to make a quick buck. They neither know nor care about the ideology, decentralization, removing intermediaries and other such lofty goals of crypto. Most people are in it because they either saw someone making a lot of money or read about it in the media and they also want a piece of it.

It's speculation, plain and simple. If not ban, government needs to regulate it like it regulates other speculative markets.

As for the libertarian goals of removing the central authority - that's not happening.

India seeks to block most cryptocurrencies in new bill, government says

Related Stories