Switzerland embraces digital currencies and crypto-entrepreneurs(economist.com)
economist.com
Switzerland embraces digital currencies and crypto-entrepreneurs
https://www.economist.com/news/finance-and-economics/21737255-switzerland-embraces-digital-currencies-and-crypto-entrepreneurs-banking-centre
150 comments
> Cryptocurrencies are still 100% hype & speculation; a solution in search of a problem.
Without any sarcasm: I saw them in use twice during the last 6 months in a very real use case, ie, hackers requesting a ransom (in the first case it was BTC, in the second it was Monero, which makes even more sense AFAIK).
Without any sarcasm: I saw them in use twice during the last 6 months in a very real use case, ie, hackers requesting a ransom (in the first case it was BTC, in the second it was Monero, which makes even more sense AFAIK).
Might depend on your social circle, some groups might use it more then others. I have seen them being used much more frequently (and way beyond ransomware scenarios). For instance Bitcoin debit cards (e.g Ten X) are quite common and for those that got in the market early, it's a cheap way of buying anything. In some countries it's not even a taxable event to spend it. Still not perfect in the sense of having to use Visa, and down the road transactions will be much more direct when more merchants will start directly accepting crypto currencies.
my friends and I send BTC, LTC, ETH to each other instead of paypal, bank transfer, or cash
typically one of us pays the bill with a credit card and the others send him crypto to settle. same with selling electronics to each other and paying rent.
typically one of us pays the bill with a credit card and the others send him crypto to settle. same with selling electronics to each other and paying rent.
Me and my friends use Venmo. Why would I want to send my friends crypto if I expect its value to increase? I wouldn't also want to receive crypto if I expect it to crash soon. It's simply not practical to adopt crypto in large scale.
Isn't it incredibly expensive to send BTC for this?
I disagree. Plenty of people use cryptocurrency without caring about the current value, but merely as a medium of exchange. If I want to buy something with bitcoin, it really doesn't matter it's current price. I just buy some bitcoin at the current price and buy what I want leaving 0 bitcoin risk.
For what though? If I don’t have to make that conversion then what’s the point?
Whilst there is a lot of hype and speculation I think you are mistaken about there being no real-world applicability. My bank has so many fees and loopholes for sending money even within the EU and they can take days.
I owed a friend some money and I sent him BTC which arrived in a couple of hours with fees that were about 10% of what I pay using the banking system. Real-world applicability and a satisfied user.
I owed a friend some money and I sent him BTC which arrived in a couple of hours with fees that were about 10% of what I pay using the banking system. Real-world applicability and a satisfied user.
1) I don't what bank you're using but it's really bad
2) It's been a LONG time since we can transfer money really fast at a really low cost
2) It's been a LONG time since we can transfer money really fast at a really low cost
>>2) It's been a LONG time since we can transfer money really fast at a really low cost
Transferring money from many places in the world is not cheap or easy (think of third world countries) - but even in more developed countries it can take quite long and have heavy fees. Crypto enables people to be their own bank.
Transferring money from many places in the world is not cheap or easy (think of third world countries) - but even in more developed countries it can take quite long and have heavy fees. Crypto enables people to be their own bank.
really? what can you use to transfer money from the US to the Philippines "really fast at a really low cost"?
I transferred nearly 1000€ worth of BTC yesterday and it took one hour and cost cents.
With the new SEPA instant a transfer takes 10 sec max [1]
[1] https://www.europeanpaymentscouncil.eu/what-we-do/sepa-insta...
[1] https://www.europeanpaymentscouncil.eu/what-we-do/sepa-insta...
> so many fees and loopholes for sending money even within the EU
Get yourself a bank which does SEPA properly.
Get yourself a bank which does SEPA properly.
Easier said than done at least in Spain. Poor opening hours and poor customer service. It's one of the reasons I'm a fan of crypto for the ease of transferring.
But the issue is lack of competition, not something that can only be solved by crypto currency. The original statement was that crypto is still looking for an actual problem to solve. Lack of competition and slow transfers isn't something related to crypto. Meaning, at a point Bitcoin took hours to work as well which a really high fee. SEPA apparently is 1 EUR and 10 seconds.
Ease of transferring seems dubious as well, crypto can also be slow or quick.
Ease of transferring seems dubious as well, crypto can also be slow or quick.
But the issue is lack of competition
These are fair points, my reply was to the OP who said crypto was 100% hype and speculation which I didn't agree with. I'm giving a data point of crypto being useful for me, yes BTC has been slow at points but I've also had with each bank I've ever used (Natwest/Santander/Banco Sabadell/Barclays) points where my accounts were under maintenance and couldn't be moved.
Probably because historically banking licences where handed out to those sympathetic to the Franco regime.
Well, with BTC you don't need a bank at all.
In the EURO Zone, SEPA transfers worked really well for me so far:
- SEPA fee is less than 1 EURO, regardless of the volume (e.g. with UBS, but some banks might rip you off)
- it takes at most 2 banking days, but half of the payments made before the bank day opening, are transferred during the current day in my experience
In the Eurozone, SEPA transfers are free. Outside Eurozone, but within EU, there are typically small fees.
SEPA is made free by a law, not by good technical design. It means it is not free because the banks would like to charge us and can't, so maybe the whole bank account fees are superior in some way we can't see.
It's the same with the EU law for mobile roaming data. It looks like laws made for the riches cosmopolitan against the poor that don't travel much in Europe
It's the same with the EU law for mobile roaming data. It looks like laws made for the riches cosmopolitan against the poor that don't travel much in Europe
SEPA is completely free (as a customer), in my experience.
Those problems are not technical though. Centralized systems using banks are more efficient in theory. It's just databases talking to each other, there is no technical reason why transfers can't be near instantaneous and basically free. Cryptocurrencies might provide incentives for banks to lower their fees and polish their crusty legacy code, but I can't see them displacing banks for everyday use.
Good point but crypto are not only new payment system but also new currencies... No more helicopter money
Within the EU and EFTA, SEPA transfers are free.
In addition to having zero real world value other than speculation and hype value, the currencies have very real negative impacts on the world.
The one that worries me the most is environmental (power cost, gpu/asic manufaturing).
It also sucks for projects that actually needs to use computational time for real world problems like folding@home and seti@home.
And it sucks big time for PC gamers.
The one that worries me the most is environmental (power cost, gpu/asic manufaturing).
It also sucks for projects that actually needs to use computational time for real world problems like folding@home and seti@home.
And it sucks big time for PC gamers.
Oh no, the people trying to start a financial revolution accidentally screwed over people who wanted to play video games!!! Give me a break. Its very possible that cryptocurrencies will never make a difference and end up being a failed experiment but the majority of the arguments i see against it are so weak/tired. Large companies are ruining the environment in developing countries but you’re worried about the energy consumption of cryptos??
I don't think you should be so absolute in your assessment, it has many values to a lot of people. Also the traditional banking system is hardly a paragon of virtue when it comes to illegal money laundering, currency manipulation, LIBOR scandal,the sub-prime mortgages.
As the eco-system evolves hopefully the environmental impact would be reduced significantly.
As the eco-system evolves hopefully the environmental impact would be reduced significantly.
Plenty of real world uses. Cash on the internet needs to exist. Centralized financial control is not a good thing 100% of the time.
It does indeed suck it's turned into such an insane hype machine and get rich quick scheme - but it solved a real world problem that is going to become more and more acute. The war on cash is real, and having a digital cash to fight back with is necessary if you value freedom or privacy on any level.
Ask wikileaks how well relying on banking access went for them. And like it or not, plenty of grey and black markets exist.
It does indeed suck it's turned into such an insane hype machine and get rich quick scheme - but it solved a real world problem that is going to become more and more acute. The war on cash is real, and having a digital cash to fight back with is necessary if you value freedom or privacy on any level.
Ask wikileaks how well relying on banking access went for them. And like it or not, plenty of grey and black markets exist.
>"Switzerland does not 'embrace' digital currencies per se. We (or rather: our politicians and ecosystem shovel-sellers) are looking desperately for a new focus area after having lost most of the historical wealth management appeal and since some of the early crypto companies settled here they kind of ran with it."
I'm guessing you are referring to the end of Swiss banking secrecy here? [1]
I agree that this seems like a very successful marketing juggernaut so far with Zug. Do you or anyone else know why Ethereum ended up being based in Zug? Is Zug that much cheaper than Zurich which is only 30 minutes or so by train?
[1] https://www.swissinfo.ch/eng/business/tax-evasion_swiss-say-...
I'm guessing you are referring to the end of Swiss banking secrecy here? [1]
I agree that this seems like a very successful marketing juggernaut so far with Zug. Do you or anyone else know why Ethereum ended up being based in Zug? Is Zug that much cheaper than Zurich which is only 30 minutes or so by train?
[1] https://www.swissinfo.ch/eng/business/tax-evasion_swiss-say-...
Yes, Zug is very advantageous for tax reasons.
Interesting, tax rates in Switzerland are on a canton by canton basis correct? I have also heard that the reason for Zug's favorable tax rates is because it was once one of the poorer cantons comparatively speaking.
I have also heard that Zurich is quite favorable as well which is interesting because its also quite expensive.
I have also heard that Zurich is quite favorable as well which is interesting because its also quite expensive.
> Interesting, tax rates in Switzerland are on a canton by canton basis correct?
Broadly speaking, yes.
> I have also heard that the reason for Zug's favorable tax rates is because it was once one of the poorer cantons comparatively speaking.
I don't know. Sorry!
> I have also heard that Zurich is quite favorable as well which is interesting because its also quite expensive.
I'm not sure - depends on whether you mean taxes for companies or private individuals. Also, certain tax brackets vary in the canton (almost village to village). Finally, it depends on your (or your company's) tax goals. Someone earning $30k/year will probably be better off in a Gemeinde/Canton which wouldn't be optimal at $300k/year.
Broadly speaking, yes.
> I have also heard that the reason for Zug's favorable tax rates is because it was once one of the poorer cantons comparatively speaking.
I don't know. Sorry!
> I have also heard that Zurich is quite favorable as well which is interesting because its also quite expensive.
I'm not sure - depends on whether you mean taxes for companies or private individuals. Also, certain tax brackets vary in the canton (almost village to village). Finally, it depends on your (or your company's) tax goals. Someone earning $30k/year will probably be better off in a Gemeinde/Canton which wouldn't be optimal at $300k/year.
Aside from low taxes, Zug is also home to Glencore and a lot of commodity trading shops. These skills translate extremely well to cryptocurrency trading.
Ah yes, Glencore - Marc Rich, the FBI's most wanted, the Mossad, Oil embargoes, dictators, a U.S Presidential pardon ...
For anyone not familiar with the story of Marc Rich and what became Glencore, it's pretty fascinating. It definitely helped put Zug on the map long before crypto-currencies. I had actually forgotten about all this.
See:
https://sites.utexas.edu/culturescontexts/2013/06/30/marc-ri...
and
https://www.economist.com/news/obituary/21580438-marc-rich-k...
For anyone not familiar with the story of Marc Rich and what became Glencore, it's pretty fascinating. It definitely helped put Zug on the map long before crypto-currencies. I had actually forgotten about all this.
See:
https://sites.utexas.edu/culturescontexts/2013/06/30/marc-ri...
and
https://www.economist.com/news/obituary/21580438-marc-rich-k...
>>a solution in search of a problem
Its their to enable - that's what technology is for.
Its their to enable - that's what technology is for.
> Cryptocurrencies are still 100% hype & speculation; a solution in search of a problem.
Just because you don't understand it, it doesn't mean that it has no uses. Beyond criminal activities, crypto assets have tremendous uses. I have practically moved all my assets to the crypto world and it has saved me a lot of money on international transfers, bank fees and I'm getting better return on investment.
Just because you don't understand it, it doesn't mean that it has no uses. Beyond criminal activities, crypto assets have tremendous uses. I have practically moved all my assets to the crypto world and it has saved me a lot of money on international transfers, bank fees and I'm getting better return on investment.
you and i have a very different definition of 'investment' then.
if i go to las vegas, put everything i own on red (because surely, red must be the future!) and win - have i made a great investment?
your other 'tremendous' use will disappear anyway in the traditional banking sector, as they did in Europe with SEPA (see comments below).
and don't forget that some of those fees buy you (legal) stability, low volatility and a system that's pretty robust in general. of course it could be leaner and faster but evolution is sometimes healthier than revolution if a lot is at stake (i.e. everyone's wealth)
if i go to las vegas, put everything i own on red (because surely, red must be the future!) and win - have i made a great investment?
your other 'tremendous' use will disappear anyway in the traditional banking sector, as they did in Europe with SEPA (see comments below).
and don't forget that some of those fees buy you (legal) stability, low volatility and a system that's pretty robust in general. of course it could be leaner and faster but evolution is sometimes healthier than revolution if a lot is at stake (i.e. everyone's wealth)
How often are you people making international transfers? The typical person surely does this only a few times in their life.
Not sure what the 'typical' HN person looks like. But I have lived in 8 countries, have had bank accounts in all of them, have had companies in 2 of them, projects in 3 (including countries in Africa where transfers are a nightmare) ... so yes, some of us do international transfers all the time. And MoneyGram / WesternUnion / your usual bank often sucks (takes a couple of days to clear / fees are crazy).
A cynical way to look at this will be that Switzerland had enabled people - corrupt politicians, dictators etc, especially from third world countries, hide money. They refused to divulge bank details citing privacy concerns. But in recent years details have come to light - either through leaked data or country actions. This has led to weakening of their infamous privacy rules.
With cryptocurrency's rise, it offers Switzerland a new way to continue their privacy bs. So, obviously they are going to embrace and enable.
With cryptocurrency's rise, it offers Switzerland a new way to continue their privacy bs. So, obviously they are going to embrace and enable.
> privacy bs
Privacy is always BS until the lack of it bites you personally. Privacy (i.e. 4th amendment) is to Swiss what 2nd and 4th amendment is to conservative Americans: Our insurance against government overreach.
The problem is of course that not every place is as democratic (i.e. ruled by the people as a whole) and low in crime, therefore privacy creates unwanted side effects in form of illegitimate uses. What exactly is illegitimate is up for discussion though - e.g. I consider tax hiding as simply a symptom of governments failing to create stringent market places where taxes flow automatically and fairly. As long as you don't have a world- (solar system?) wide government with total control, you'll never eliminate the availability of tax havens, they just get shifted around - currently the easiest place to hide is probably Delaware.
I see cryptocurrency as a nice opportunity to introduce a much more stringent monetary system where it's trivial to trace back the origin of money and track whether it has been earned in a legitimate way, including the deduction of taxes. People will still have the same options in general:
(a) store it in a personal offline wallet - somewhat dangerous due to potential loss and/or forgetting access codes
(b) give access codes to a trusted bank who will have an interest in tracing whether everything is in order (due to regulations)
(c) store it somewhere off-shore, risking fraud
What crypto enables is basically a clean separation of (b) and (c), which would make life easier for Swiss banks in the current landscape, i.e. allow them to once again deal freely with foreign nationals, especially Americans.
Privacy is always BS until the lack of it bites you personally. Privacy (i.e. 4th amendment) is to Swiss what 2nd and 4th amendment is to conservative Americans: Our insurance against government overreach.
The problem is of course that not every place is as democratic (i.e. ruled by the people as a whole) and low in crime, therefore privacy creates unwanted side effects in form of illegitimate uses. What exactly is illegitimate is up for discussion though - e.g. I consider tax hiding as simply a symptom of governments failing to create stringent market places where taxes flow automatically and fairly. As long as you don't have a world- (solar system?) wide government with total control, you'll never eliminate the availability of tax havens, they just get shifted around - currently the easiest place to hide is probably Delaware.
I see cryptocurrency as a nice opportunity to introduce a much more stringent monetary system where it's trivial to trace back the origin of money and track whether it has been earned in a legitimate way, including the deduction of taxes. People will still have the same options in general:
(a) store it in a personal offline wallet - somewhat dangerous due to potential loss and/or forgetting access codes
(b) give access codes to a trusted bank who will have an interest in tracing whether everything is in order (due to regulations)
(c) store it somewhere off-shore, risking fraud
What crypto enables is basically a clean separation of (b) and (c), which would make life easier for Swiss banks in the current landscape, i.e. allow them to once again deal freely with foreign nationals, especially Americans.
It seems it is true - you read what you believe and rest is all lost. So thank you for quoting a misused qualifier from my post for your counter.
I don't expect people who have not lived or experienced what people like me in the developing countries have to go through because of the Swiss privacy bs. Though I do expect them to hem and haw when stuff like Panama papers are revealed.
Additionally, it seems you don't really understand how cryptocurrency work. Bitcoin is pseudo-anonymous and hence, it allows stuff like this:
> I see cryptocurrency as a nice opportunity to introduce a much more stringent monetary system where it's trivial to trace back the origin of money and track whether it has been earned in a legitimate way, including the deduction of taxes.
True anonymity which you want from the 4th Amendment, happens in cryptocurrencies like Monero. Those are resistant to blockchain analysis and you can't trace it back to origin.
I don't expect people who have not lived or experienced what people like me in the developing countries have to go through because of the Swiss privacy bs. Though I do expect them to hem and haw when stuff like Panama papers are revealed.
Additionally, it seems you don't really understand how cryptocurrency work. Bitcoin is pseudo-anonymous and hence, it allows stuff like this:
> I see cryptocurrency as a nice opportunity to introduce a much more stringent monetary system where it's trivial to trace back the origin of money and track whether it has been earned in a legitimate way, including the deduction of taxes.
True anonymity which you want from the 4th Amendment, happens in cryptocurrencies like Monero. Those are resistant to blockchain analysis and you can't trace it back to origin.
Is it really fair to blame the Swiss for the behaviour of your politicians? I'm not convinced.
You don’t seem to be interpreting what I write favorably. My main point is that there is a balance to strike between privacy and control. One of the main issues in developing nations is that opening a small business legally is overly complicated (in some cases literally years of administrative work for the applicant), so people are forced to keep everything out of the books, which prevents them from ever gaining wealth needed to reinvest. An ideal system IMO would achieve full transparency for the money of larger organisations (including governments) while giving privacy to private people and small businesses. The Swiss system is very good at achieving the latter but rather poor at at former (for which instead direct democratic processes are intended to achieve the necessary checks). I don’t have a perfect solution for this problem, but IMO it’s worth thinking about - and crypto seems to be promising. Maybe a combination of Monero and Ethereum where privacy is optional, with regulations for what kind of transactions transparence is required?
> Privacy (i.e. 4th amendment) is to Swiss what 2nd and 4th amendment is to conservative Americans: Our insurance against government overreach.
Ah, that's utter BS. Not one of the advocates of banking privacy is demanding similar privacy for wage statements. Oh no, if your income comes mainly from wages, you obviously can't be trusted like people whose income comes from investments!
Ah, that's utter BS. Not one of the advocates of banking privacy is demanding similar privacy for wage statements. Oh no, if your income comes mainly from wages, you obviously can't be trusted like people whose income comes from investments!
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Your only defense against government overreach (ie violent aggression) is self-defense (ie genuine, well-trained militia of free people).
Reference to: The constitution of no authority by Lysander Spooner, and, The law by F.Bastiat
Reference to: The constitution of no authority by Lysander Spooner, and, The law by F.Bastiat
Does the genuine well trained militia also have genuine well-tested nuclear weapons, predator drones, recon and comm satellites, redundant infrastructure and easily access to manufacturing capabilities?
Every colonised and now forgotten group of people had what they thought was a genuine well trained militia, for all the good it did them.
Every colonised and now forgotten group of people had what they thought was a genuine well trained militia, for all the good it did them.
Americans have fought world's most powerful army and won, this is why they wrote it in their constitution. At the same time they have managed become world's most powerful army and still not managed to win against a ragtag group of militants.
If citizens of any country get to make a claim about the effectiveness of an armed citizenry, then it is the Americans.
If citizens of any country get to make a claim about the effectiveness of an armed citizenry, then it is the Americans.
> not managed to win against a ragtag group of militants.
Those militants are not ragtag. They all receive state sponsorship in the form of finances, hardware, training and logistics.
Your analysis also ignores the reality of asymmetric warfare, in particular the asymmetry of the value placed on the lives of the combatants on the different sides.
Terrorist organizations are far more willing to sacrifice their combatants than the US is, and they have a pool of people who share this outlook to recruit from, which is why they persist.
In the event of an internal armed conflict within a developed country, all sides are likely to value the lives of their fighters similarly.
Those militants are not ragtag. They all receive state sponsorship in the form of finances, hardware, training and logistics.
Your analysis also ignores the reality of asymmetric warfare, in particular the asymmetry of the value placed on the lives of the combatants on the different sides.
Terrorist organizations are far more willing to sacrifice their combatants than the US is, and they have a pool of people who share this outlook to recruit from, which is why they persist.
In the event of an internal armed conflict within a developed country, all sides are likely to value the lives of their fighters similarly.
What is an example of a genuine, well-trained militia, and how does it fare against a government's military?
This question falsely presumes that the government's military is not also fractured by whatever is causing the militia to revolt. The military is made up of citizens.
But then why do you need the militia?
To protect yourself from and fight against weakened fractions of the government.
The military cannot occupy the entire space of the US so maintaining order of a tyrannical government would require a low ratio of military guards to citizens. With even 50% of the citizens potentially armed and willing to fight back, it's an untenable position for the government.
A militia could fight just as effectively as the Taliban against the government and be several orders of magnitude larger. The US military is good at eliminating identified enemies, but it's pretty terrible at nation building and that's even in its strongest state.
The military cannot occupy the entire space of the US so maintaining order of a tyrannical government would require a low ratio of military guards to citizens. With even 50% of the citizens potentially armed and willing to fight back, it's an untenable position for the government.
A militia could fight just as effectively as the Taliban against the government and be several orders of magnitude larger. The US military is good at eliminating identified enemies, but it's pretty terrible at nation building and that's even in its strongest state.
Because I want to a reason to own lots of guns.
Afghan militia has fared well both against US/NATO and Soviet militaries in the past 50 years.
If you are referring to the Taliban and their precursors, they have had, and continue to have significant financial and logistical backing from nation states.
In a democracy it is the role of the free press, the courts and elections to defend against government overreach.
Do you really believe that the 20,000 to 60,000 estimated [1] militia members in the US is what is defending you agains government overreach? There are more than 1.2 million people in the US army (with a $600 billion budget) and 120,000 federal police officers [2].
Another point to consider: democracies outside the US, that don't have 'well-trained militia of free people', seem to be doing just fine. In a number of metrics that you can consider as a proxy for government overreach the US is actually doing much worse than average: number of people shot by the police, number of people imprisoned, number of (innocent) people executed.
[1] https://en.wikipedia.org/wiki/Militia_organizations_in_the_U... [2] https://en.wikipedia.org/wiki/Law_enforcement_in_the_United_...
Do you really believe that the 20,000 to 60,000 estimated [1] militia members in the US is what is defending you agains government overreach? There are more than 1.2 million people in the US army (with a $600 billion budget) and 120,000 federal police officers [2].
Another point to consider: democracies outside the US, that don't have 'well-trained militia of free people', seem to be doing just fine. In a number of metrics that you can consider as a proxy for government overreach the US is actually doing much worse than average: number of people shot by the police, number of people imprisoned, number of (innocent) people executed.
[1] https://en.wikipedia.org/wiki/Militia_organizations_in_the_U... [2] https://en.wikipedia.org/wiki/Law_enforcement_in_the_United_...
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This is a particularly stupid comment to make in the context of Switzerland, where everyone(+) keeps their national service rifle in their house.
(+) well, a lot of people, even if it's no longer every man of relevant age
(+) well, a lot of people, even if it's no longer every man of relevant age
In my opinion as a Swiss
- Large parts of our financial sector have never truly figured out how to make money doing honest services for honest customers. As traditional revenue sources (stealing from Nazi victims, hiding dictators' money, assisting in income tax fraud, LIBOR rate fraud) have gradually dried up, the prospect of a new, extremely shady, financial sector is irresistible to bankers and their political allies.
- The lack of imagination in honest banking is going along with chasing the tail end of trends, especially US trends. The large Swiss banks were always happy to provide the dumb money, e.g. in the 2008 crash.
So small wonder that a figure like Johann Gevers will find Swiss bankers and politicians eager to cozy up to him.
- Large parts of our financial sector have never truly figured out how to make money doing honest services for honest customers. As traditional revenue sources (stealing from Nazi victims, hiding dictators' money, assisting in income tax fraud, LIBOR rate fraud) have gradually dried up, the prospect of a new, extremely shady, financial sector is irresistible to bankers and their political allies.
- The lack of imagination in honest banking is going along with chasing the tail end of trends, especially US trends. The large Swiss banks were always happy to provide the dumb money, e.g. in the 2008 crash.
So small wonder that a figure like Johann Gevers will find Swiss bankers and politicians eager to cozy up to him.
FYI, The Swiss government also often freezes assets when requested by legal international means [1].
[1] https://www.eda.admin.ch/eda/en/home/foreign-policy/financia...
Edit: typo
[1] https://www.eda.admin.ch/eda/en/home/foreign-policy/financia...
Edit: typo
privacy BS? I find it weird that anyone would default to thinking nobody should have privacy. Why is it anyones business what anyone else does with money? Unless you are breaking the law ( which is already illegal ) why does it matter what people anywhere are doing with their money?
> Unless you are breaking the law ( which is already illegal )
I think the critique is that the privacy is being used as a mechanism for breaking the law, by hiding illegally gotten gains.
I think the critique is that the privacy is being used as a mechanism for breaking the law, by hiding illegally gotten gains.
The argument for violating privacy in communications is literally that it is being used as a mechanism for breaking the law.
I'd be interested in hearing a logically consistent argument for why bad guys hiding illegally gotten gains is a legitimate reason for opposing banking privacy, but bad guys using encrypted communication platforms for planning crimes isn't a legitimate reason to oppose communications privacy.
In both cares, the information would of course only be available to the government who will only ever use it for Legitimate Good(tm).
I'd be interested in hearing a logically consistent argument for why bad guys hiding illegally gotten gains is a legitimate reason for opposing banking privacy, but bad guys using encrypted communication platforms for planning crimes isn't a legitimate reason to oppose communications privacy.
In both cares, the information would of course only be available to the government who will only ever use it for Legitimate Good(tm).
But by that logic it should be ok to monitor everything anyone does because if you do not, a person might be able do to something illegally under the cover of privacy.
I don't understand your use of "monitor" here. Banks by their very nature "monitor" your financial details, what else are they going to be doing?
Swiss banks will routinely refuse to honour legal requests for information from international law enforcement, e.g from 3rd world countries investigating their own corrupt politicians.
Swiss banks will routinely refuse to honour legal requests for information from international law enforcement, e.g from 3rd world countries investigating their own corrupt politicians.
What's even better is that crypto currencies are redefining in their own way "money" so I would rephrase what you said in "Why is it anyones business what anyone else does with their computer and internet connection? "
encryption has brought data back into our own control to an extent. cryptocurrency is doing the same with money. I think people are so steeped in the current system that they don't realize that people expected a certain degree of financial privacy up until recently. Besides paying your taxes ( which is also a recent invention in the US ) it was never any business of the government what anyone did with their money. Reading about the history of the US people seem to have forgotten why the country was founded and what people thought before about 80 years ago. Life, liberty, property. In no way does that include thugs with guns forcing you to give up your hard earned money.
There was NO income tax on individuals up until WW1 ever in the US. Through a slow process that takes years to change the Federal government has crept into our lives taking more money and control. It is extremely worrysome to me that other young people my age want more government control and not less.
https://en.wikipedia.org/wiki/Income_tax_in_the_United_State...
There was NO income tax on individuals up until WW1 ever in the US. Through a slow process that takes years to change the Federal government has crept into our lives taking more money and control. It is extremely worrysome to me that other young people my age want more government control and not less.
https://en.wikipedia.org/wiki/Income_tax_in_the_United_State...
I think you're giving our politicians/finance system too much credit. Besides, after the US debacle regulators did a 180 on the topic.
If (and that's a big if) cryptocurrency ecosystems get large enough to attract significant institutional money / wealth management you can be sure that all participants will be held accountable in terms of KYC / AML / Regularization etc.
If any of the startups here think differently they will be in for a rude awakening.
If (and that's a big if) cryptocurrency ecosystems get large enough to attract significant institutional money / wealth management you can be sure that all participants will be held accountable in terms of KYC / AML / Regularization etc.
If any of the startups here think differently they will be in for a rude awakening.
Cryptocurrencies have made it easier than ever to channel large amounts of black money out of your country.
And since Switzerland is the world's favorite place to hide money, it is no more than logical that it embraces this new vehicle of black money transport.
> corrupt politicians, dictators etc, especially from third world countries
How is that Switzerland issue or responsibility? They can't judge people for what they do overseas.
How is that Switzerland issue or responsibility? They can't judge people for what they do overseas.
This is somewhat off-topic, but I think the cryptocurrency craze came at the worst possible time. Here we are, amidst an ecological crisis, the poles are melting, and people are using insane amounts of energy on...mining digital "currencies".
Yes, blockchains are useful, cryptocurrency has its place, but if the current (ecological) trend continues, even fiat money will be worthless in many parts of the world in 20 years.
Please consider the environment before buying a $3000 mining rig with expected profits of $100/month.
Yes, blockchains are useful, cryptocurrency has its place, but if the current (ecological) trend continues, even fiat money will be worthless in many parts of the world in 20 years.
Please consider the environment before buying a $3000 mining rig with expected profits of $100/month.
I’m not saying we shouldn’t look for better solutions, but just to put things in perspective, Bitcoin uses approximately 30 TWh/year, while global energy consumption is more than 100,000 TWh/year (so 0.03%).
People have also hypothesized that energy used in mining cryptocurrency will tend to be cleaner since mining operations can be located close to cheap/renewable electricity.
People have also hypothesized that energy used in mining cryptocurrency will tend to be cleaner since mining operations can be located close to cheap/renewable electricity.
The problem is that bitcoin is used by less than 0.03% of the people in the world. Bitcoin energy spenditure is proportional to demand for bitcoin and we should expect mining costs to go up drastically if Bitcoin becomes more popular. (Mining costs are proportional to mining rewards, which in turn is proportional to prices, which are a function of demand).
True, but mining rewards also halve every 4 years.
currently the most energy efficient places are mainly used for the large crypto mines. places with "excess" energy such as new hydroelectric dams in rural China and recently wind and solar with excess production.
Also for perspective the old school equivalent of bitcoin mining, gold mining uses about 220 TWh/year or rather more.
That's still the equivalent of 2.3 million people, more than the population of a third of the countries in the world.
And? The global population increases by about 80 million people per year.
Comparisons like yours feel like they're designed to inflate the scale of a problem.
Comparisons like yours feel like they're designed to inflate the scale of a problem.
I guess you could argue it's ironic or hypocritical in some way to squander electricity in the era of climate change, but it's completely wrong to identify cryptocurrency as a serious contributor to climate change.
We can even set aside the fact that renewable sources of electricity can be and are used to mine cryptocurrency (e.g. the vast bitcoin mines co-located with Chinese hydro dams). The real problem with this argument is it represents the same fallacy you see with "violent video games are driving kids to be more violent"
Even if it were true, it tackles the social problem in question backwards. Instead of asking "do video games make kids more violent" we should be asking "what are the main drivers of violence in our society?"
Climate change is caused by fossil-fuel power generation, trucking, personal automobiles, greenhouse gas emitting industry, and agriculture. It's not caused by bitcoin, even if bitcoin mining contributes to it in some minuscule way by comparison to the real drivers.
We can even set aside the fact that renewable sources of electricity can be and are used to mine cryptocurrency (e.g. the vast bitcoin mines co-located with Chinese hydro dams). The real problem with this argument is it represents the same fallacy you see with "violent video games are driving kids to be more violent"
Even if it were true, it tackles the social problem in question backwards. Instead of asking "do video games make kids more violent" we should be asking "what are the main drivers of violence in our society?"
Climate change is caused by fossil-fuel power generation, trucking, personal automobiles, greenhouse gas emitting industry, and agriculture. It's not caused by bitcoin, even if bitcoin mining contributes to it in some minuscule way by comparison to the real drivers.
It is very much relevant. In the oft-recited "Reduce. Reuse. Recycle.", they're ranked in order of descending effectiveness: it's most effective to look for ways to reduce energy consumption. Yes, we need to look at which sources we're getting energy from, but just like the most bug-free code is the code that's never written, not needing the energy in the first place makes the first question moot. Of course, this is important across all energy consumption, but that doesn't make it irrelevant or hypocritical to discuss in the context of cryptocurrency mining.
Do you heat your house? Maybe not, maybe you live somewhere warm, but many people do.
Consider that bitcoin mining (or hashing for science) is a much more efficient way to make heat than simply converting energy into heat for the sake of heat.
Consider that bitcoin mining (or hashing for science) is a much more efficient way to make heat than simply converting energy into heat for the sake of heat.
I've heard that, in Switzerland, you can buy Bitcoin at train station ticket machines.
I'm not sure you can buy Bitcoin, but you can buy public transit tickets with Bitcoin (from kiosks) in Zurich and likely elsewhere in Switzerland.
I recently was lucky enough to have a conversation with a co-founder of a large cryptocurrency (identifying details redacted for his privacy), and among many other interesting ideas, he talked about the inflection point for a potential crypto-filled future.
He doesn't see people being willing, en masse, to convert the currency they receive (in a paycheck, for example) into another currency unless absolutely necessary. This is a chicken-egg problem if you want crypto widely adopted, where you need the vendors to adopt crypto but it'll likely have to be the government or company first that distributes it to citizens/employees.
He specifically mentioned Switzerland as a great country to explore a system like this (think Anti-Venezuela lol); if they were to found/back a decentralized currency, it could quickly reach mass adoption and we could actually function in society on crypto. I'm interested to see whether Switzerland could go that far with their approach.
The incentives that could be provided to make it worthy for a country like Switzerland to found/back a currency which they don't ultimately control are unclear, but nonetheless an idealistic concept.
He doesn't see people being willing, en masse, to convert the currency they receive (in a paycheck, for example) into another currency unless absolutely necessary. This is a chicken-egg problem if you want crypto widely adopted, where you need the vendors to adopt crypto but it'll likely have to be the government or company first that distributes it to citizens/employees.
He specifically mentioned Switzerland as a great country to explore a system like this (think Anti-Venezuela lol); if they were to found/back a decentralized currency, it could quickly reach mass adoption and we could actually function in society on crypto. I'm interested to see whether Switzerland could go that far with their approach.
The incentives that could be provided to make it worthy for a country like Switzerland to found/back a currency which they don't ultimately control are unclear, but nonetheless an idealistic concept.
It sounds like what you're describing is replacing the functional (read: relatively stable inflation-wise) swiss franc with... ?
Assuming you implemented a POW blockchain-based, decentralized (anyone can download and run a node), virtual currency, this would remove control over the supply and generation of the currency from the Swiss National Bank (fiscal and monetary policy experts) and give it to...Chinese cryptocurrency miners + whatever group of developers Switzerland decides to put in charge of maintaining and upgrading the swiss blockchain?
What your friend is referring to is actually an idealized economic concept, the "Stablecoin" - one that is pegged to the exact right basket of goods, services, and semi-finished industrial products that it experiences little to no inflation/deflation and can be counted on as a store of value.
All countries are or should be trying to create a Stablecoin relative to their own economies - allowing private citizens to assume their $5,000 USD will be able to buy roughly the same amount of goods and services in, say 6 months.
All this to say...the Swiss have already created a Stablecoin for their economy...the franc. There is no reason to break up and decentralize an organization that is competently managing a currency. It only makes sense in cases (such as Venezuela) where the central authority is doing a terrible job of managing their currency, and is nowhere near achieving "Stablecoin" status. Or for markets where there is no accepted "Stablecoin" because they are illegal/no enforcement mechanism to honor the transaction (e.g. you can't bring a lawsuit in a US court against a drug dealer if he takes your USD and sells you bad drugs).
Assuming you implemented a POW blockchain-based, decentralized (anyone can download and run a node), virtual currency, this would remove control over the supply and generation of the currency from the Swiss National Bank (fiscal and monetary policy experts) and give it to...Chinese cryptocurrency miners + whatever group of developers Switzerland decides to put in charge of maintaining and upgrading the swiss blockchain?
What your friend is referring to is actually an idealized economic concept, the "Stablecoin" - one that is pegged to the exact right basket of goods, services, and semi-finished industrial products that it experiences little to no inflation/deflation and can be counted on as a store of value.
All countries are or should be trying to create a Stablecoin relative to their own economies - allowing private citizens to assume their $5,000 USD will be able to buy roughly the same amount of goods and services in, say 6 months.
All this to say...the Swiss have already created a Stablecoin for their economy...the franc. There is no reason to break up and decentralize an organization that is competently managing a currency. It only makes sense in cases (such as Venezuela) where the central authority is doing a terrible job of managing their currency, and is nowhere near achieving "Stablecoin" status. Or for markets where there is no accepted "Stablecoin" because they are illegal/no enforcement mechanism to honor the transaction (e.g. you can't bring a lawsuit in a US court against a drug dealer if he takes your USD and sells you bad drugs).
If any country wants to have a stable coin, they can choose US dollar or Swiss Franc as its currency. There are already some countries doing that. Hence, there is no need for a crypto currency for a stable coin.
The downside is that you cannot control the monetary policy of your of own country. You cannot pump money according to the economic situation. Look at the eurozone, for example, Germany wants to increase rates -hence increase the value of Euro- whereas Greece is still struggling. Leaving your currency to somebody else’s decisions may not be a good idea.
The downside is that you cannot control the monetary policy of your of own country. You cannot pump money according to the economic situation. Look at the eurozone, for example, Germany wants to increase rates -hence increase the value of Euro- whereas Greece is still struggling. Leaving your currency to somebody else’s decisions may not be a good idea.
Just a small off-topic comment: the Swiss Franc is not as stable as you think. For example, it used to be pegged (as in, CHF 1 was supposed to be worth EUR 1.2), but in recent history the Swiss Central Bank decided to unpeg the CHF to EUR, seemingly out of the blue.
Some reading: - https://www.economist.com/blogs/economist-explains/2015/01/e... - https://www.reuters.com/article/us-swiss-franc-shock/three-y...
Some reading: - https://www.economist.com/blogs/economist-explains/2015/01/e... - https://www.reuters.com/article/us-swiss-franc-shock/three-y...
Yes... But since we're off-topic, running with the thread for a bit, the kind of upset caused by the euro/franc un-peg is entirely inside the boundaries of "stable" in the context of the kind of country for which just adopting another nations currency is an attractive choice.
There is no reason the governance needs to change, they could still create a distribed mined coin and maintain goverance over the issue and destruction of tokens to maintain stable trading values.
Wrong...if you create a distributed mined coin, you're giving power to the miners. You can try and push updates (say from version 1 to version 2) to the nodes, but if the miners choose to ignore those updates, they can hard fork the network and run it according to a past version, or their own version, essentially creating a derivative currency. This has happened to Bitcoin - see bcash, bitcoin gold, bitcoinX, etc.
Decentralizing control by definition gives power to all of the nodes in the network, requiring their buy-in to conduct any type of "monetary policy" by changing the source code and rolling out an upgraded application.
Any changes that could increase the hash rate, increase the max number of tokens, "destroy" transactions, rollback to a certain state, etc. would require miner cooperation. Whereas right now central banks can just "create" liquidity by tweaking monetary policy without needing the banks and populace to approve and agree to these changes.
Decentralizing control by definition gives power to all of the nodes in the network, requiring their buy-in to conduct any type of "monetary policy" by changing the source code and rolling out an upgraded application.
Any changes that could increase the hash rate, increase the max number of tokens, "destroy" transactions, rollback to a certain state, etc. would require miner cooperation. Whereas right now central banks can just "create" liquidity by tweaking monetary policy without needing the banks and populace to approve and agree to these changes.
the miners can't control what's legal
Ok so if you’re going to send inspectors and police out to the ASIC farms to verify compliance and register that miner as a “chartered” miner running the right software...why change the system at all? That’s how it works with banks under the current federal reserve system in the US and defeats the whole point of decentralization
you missed the point. miners can do whatever they want with currency. but ultimately government control how you translate that into goods, land, and how those things are taxed.
Pick a consortium style chain instead? dBFT or dPOS would be great for a national, distributed currency which a government still exerts a great amount of influence over
From an economic perspective, you always have to ask: what are the incentives for someone to switch currencies. At first sight, it does not seem to matter much which unit of account you are using. However, there is in fact a strong financial incentive for the young, working generation to switch to a new currency, thereby devaluing all the nominal savings of the old, retired generation. So even in a country like Switzerland, Bitcoin or another cryptocurrency could be used by the young to brake free from paying an unfairly large share of their income to the old.
a) switch to a new currency
b) thereby devaluing all the nominal savings of the old, retired generation
In reality it won't work like that (A -> B). In this world you most likely will devalue net worth of 99% of people (poor) and prop up net worth of 1% of people (rich) simply because they OWN actual assets - whole factories and industries, mines, planes, ships, hotels, etc. everything that is bigger than a phone and more useful than a house. This move (if hypothetically it ever happened) will create even bigger disparity and faster than now, in years instead of decades.
b) thereby devaluing all the nominal savings of the old, retired generation
In reality it won't work like that (A -> B). In this world you most likely will devalue net worth of 99% of people (poor) and prop up net worth of 1% of people (rich) simply because they OWN actual assets - whole factories and industries, mines, planes, ships, hotels, etc. everything that is bigger than a phone and more useful than a house. This move (if hypothetically it ever happened) will create even bigger disparity and faster than now, in years instead of decades.
Changing your unit of account does not make a difference to your employer, your landlord, your utility company, or the shop you buy your groceries at.
It's simple, the crypto market rate beats the standard money market rate by leaps and bounds when the average consumer goes cash e.g. during the next downturn or bear market.
> However, there is in fact a strong financial incentive for the young, working generation to switch to a new currency, thereby devaluing all the nominal savings of the old, retired generation.
Huh? They could switch too. I don't see the advantage.
Also, block chain is the perfect tool for governments to track their citizens' spendings.
Huh? They could switch too. I don't see the advantage.
Also, block chain is the perfect tool for governments to track their citizens' spendings.
a strong financial incentive for the young, working
generation to switch to a new currency, thereby devaluing
all the nominal savings of the old, retired generation.
First, who is producing the new supply? How is the new supply being produced? Hopefully by them, and not a 3rd party that exploits the production and sale of this new medium...
The reason proof of work coins have no inherent value, is because there's zero economic demand except from speculators. Coins are generated though software which has a measurable cost, and why would a vendor or nation state expose their real world assets to be traded for a database token produced though this software method?
You can't just tell all the kids to start using seashells or cryptocoins for their money because it would have to equate or surpass the abilities of normal cash.. for both client and vendor.
If anything, one can imagine a nation state issuing a protocol tied to their centralized treasury but that's not too different than using a debit card.
Of course it depends on what you intend to do with your money, but for living and operating, local currency is usually most important.
Cryptocurrencies serve many specialized needs, particularly in global transfers, but they have little use in day to day, local transactions.
Anything that can be traded for value can be considered a currency, so you could theoretically trade equities with other people for goods and services. But usually, that is much less practical than exchanging local fiat currency.
Same goes for virtual currencies. Instead, you'll perhaps use virtual currencies as an intermediate currency for simplified financial transfers, or perhaps for storing some of your investments, or for utility reasons (such as tokens which are the utility fee tokens for some exchanges), or perhaps as a form of startup investment (as with ICOs).
I do wonder if the effectiveness of bitcoin as a transfer currency was any motivation behind the recent improvement in EU bank to bank transfers. What previously took one or maybe two business days for SEPA transfers has recently been improved to be near instant (so I've read; I haven't paid attention lately). Maybe the banks felt pressure to keep up?
Meanwhile, US banking customers are still passing handwritten pieces of paper around. Once US customers get verified accounts with some of the cryptocurrency money exchangers, quick USD->bitcoin->bitcoin->USD transfers are nice and fast and relatively inexpensive (with the recent dramatic drop in bitcoin mining fees).
Cryptocurrencies serve many specialized needs, particularly in global transfers, but they have little use in day to day, local transactions.
Anything that can be traded for value can be considered a currency, so you could theoretically trade equities with other people for goods and services. But usually, that is much less practical than exchanging local fiat currency.
Same goes for virtual currencies. Instead, you'll perhaps use virtual currencies as an intermediate currency for simplified financial transfers, or perhaps for storing some of your investments, or for utility reasons (such as tokens which are the utility fee tokens for some exchanges), or perhaps as a form of startup investment (as with ICOs).
I do wonder if the effectiveness of bitcoin as a transfer currency was any motivation behind the recent improvement in EU bank to bank transfers. What previously took one or maybe two business days for SEPA transfers has recently been improved to be near instant (so I've read; I haven't paid attention lately). Maybe the banks felt pressure to keep up?
Meanwhile, US banking customers are still passing handwritten pieces of paper around. Once US customers get verified accounts with some of the cryptocurrency money exchangers, quick USD->bitcoin->bitcoin->USD transfers are nice and fast and relatively inexpensive (with the recent dramatic drop in bitcoin mining fees).
Day to day transactions are actually the most likely to be disrupted by crypto when the UX & education hit the right point. The reason for this is crypto can trade with almost zero fees, which compared to card transaction fees make paying in crypto better for merchants, like taking cash.
I live in Switzerland and domestic payments are near instantaneous and free. EU based payments are also free and settle within a day. Saying crypto can trade with low fees as some sort of unique benefit is either naive or disingenuous. There is literally zero need for cryptos in this regard, because the problem can be solved in context of the existing systems too. At best, one could argue that the threat of cryptos can force shoddy banks and payment orocessors to up their game.
Debit cards already have essentially zero fees (free for customer, 0.1-0.2%) for merchants.
So that’s why most crypto currencies have exhorbitant (compared to credit card transactions) fees?
Which ones do you include in your "most" category?
Bitcoin fees, for example, are based partly on the amount of data in the transaction. It's not really a percent of amount sent factor. Whether you send 100 BTC (which is a lot of money) or 0.001 BTC, you'll pay about the same fee assuming the same number of input and output addresses.
Also, while bitcoin fees had gotten quite high toward the end of 2017 and early 2018, lately they have reset back down to a very low level. I routinely send batch payments from a dozen input addresses to some output addresses with a value total of a few thousand dollars, paying less than $1 in fees.
And anyway, you can't send people money to their credit card.
UPDATE: It appears bitcoin fees are back on the rise..., 10x what they were a day ago.
Bitcoin fees, for example, are based partly on the amount of data in the transaction. It's not really a percent of amount sent factor. Whether you send 100 BTC (which is a lot of money) or 0.001 BTC, you'll pay about the same fee assuming the same number of input and output addresses.
Also, while bitcoin fees had gotten quite high toward the end of 2017 and early 2018, lately they have reset back down to a very low level. I routinely send batch payments from a dozen input addresses to some output addresses with a value total of a few thousand dollars, paying less than $1 in fees.
And anyway, you can't send people money to their credit card.
UPDATE: It appears bitcoin fees are back on the rise..., 10x what they were a day ago.
Exactly. Soooo... Where’s the promise of ”zero fees compared to credit cards, especially for merchants”?
A real merchant example: Steam had to stop accepting bitcoins because:
- transactions took too long o complete
- (main reson) fees were unpredictable and sometimes higher than the cost if the game
A real merchant example: Steam had to stop accepting bitcoins because:
- transactions took too long o complete
- (main reson) fees were unpredictable and sometimes higher than the cost if the game
One major benefit is that the transactions are non-reversible. I suppose if you're a crooked merchant, that's not good for people.
But credit card companies have made it so easy for users to press one button to chargeback that some less than ethical consumers do this on a regular basis and get away with it.
Another thing to keep in mind is that if you operate a business and accept bitcoin as one form of payment, nobody can cut off your means to accept payment. If the kind of product or service you provide is something banks don't want to touch (even though they are legal), then you're left with few options unless you consider cryptocurrency payments. Even if you get a credit card merchant agreement, the ccard companies will routinely shut you down until you have a conversation with them, reminding them that their senior risk department has already verified you multiple times. Trust me, that gets old.
But credit card companies have made it so easy for users to press one button to chargeback that some less than ethical consumers do this on a regular basis and get away with it.
Another thing to keep in mind is that if you operate a business and accept bitcoin as one form of payment, nobody can cut off your means to accept payment. If the kind of product or service you provide is something banks don't want to touch (even though they are legal), then you're left with few options unless you consider cryptocurrency payments. Even if you get a credit card merchant agreement, the ccard companies will routinely shut you down until you have a conversation with them, reminding them that their senior risk department has already verified you multiple times. Trust me, that gets old.
1. All this doesn’t answer my question
2. All of the perceived problems have known and working solutions. BTW, fraudulent merchants are arguably a bigger problem than fraudulent consumers.
3. If I consider cryptocurrency solutions, I will:
- run into slow non-efficient transactions that can be ground to a halt by a simple cat-breeding game.
- run into unpredictable exorbitant fees that can easily be higher than the price if the product I sell.
- “nonreversible transactions” is bullshit, as there have already been cases of transactions being reversed for hacked wallets.
2. All of the perceived problems have known and working solutions. BTW, fraudulent merchants are arguably a bigger problem than fraudulent consumers.
3. If I consider cryptocurrency solutions, I will:
- run into slow non-efficient transactions that can be ground to a halt by a simple cat-breeding game.
- run into unpredictable exorbitant fees that can easily be higher than the price if the product I sell.
- “nonreversible transactions” is bullshit, as there have already been cases of transactions being reversed for hacked wallets.
Do you have a link/source to reversed BTC transactions?
At point 3, you seem to be strawmanning ETH for BTC, where it seems the user you're replying to is referring to BTC.
Early tech is early tech. We all know this. More people use the internet now that you don't have to dial-up and make your phone line busy for it.
Credit card fees are (typically) pushed to merchants, the actually settlement time takes far longer than the transaction time.
Let's say in 10 years, all of your issues are solved by a cryptocurrency -- would you like the option of having a non-state issued, hard to confiscate, tamper-resistant money?
At point 3, you seem to be strawmanning ETH for BTC, where it seems the user you're replying to is referring to BTC.
Early tech is early tech. We all know this. More people use the internet now that you don't have to dial-up and make your phone line busy for it.
Credit card fees are (typically) pushed to merchants, the actually settlement time takes far longer than the transaction time.
Let's say in 10 years, all of your issues are solved by a cryptocurrency -- would you like the option of having a non-state issued, hard to confiscate, tamper-resistant money?
> Do you have a link/source to reversed BTC transactions?
"Ethereum Executes Blockchain Hard Fork to Return DAO Funds". If you tell me I'm strawmanning ETH for BTC (or whatever other bullshit three-letter acronym) I answer this: it does not matter. Something that happens in one, will happen in another. The precedent has been set, the path is clear.
> At point 3, you seem to be strawmanning ETH for BTC, where it seems the user you're replying to is referring to BTC.
Doesn't matter. Bitcoin is just as susceptible. And no, Lightning will not save it (for obvious reasons which are totally glossed over by the dreamy-eyed proponents).
> Early tech is early tech. We all know this.
Yes. We know this. Cryptocurrency proponents seem to remember this fact only after being confronted with reality.
See how this conversation played out:
- Day to day transactions are actually the most likely to be disrupted by crypto. The reason for this is crypto can trade with almost zero fees
- No, the fees are not zero. In fact, they are prohibitively high, and unpredictable
- Yes, but... but.. the transactions are non-reversible, and there's fraud protection
- There is at least one precedent of a cryptocurrency being hard forked to reverse transactions. Fraud is already being handled. etc. etc.
- Yes, but.. but... it's early tech!
Indeed. It's early tech with very few, if any, practical uses. With exorbitant unpredictable fees, extremely slow transactions, overall inefficiency etc. etc. etc. And yet for some reason it's hailed as the saviour of everyone and everybody now even though it offers a near-zero improvement on what we already have today.
"Ethereum Executes Blockchain Hard Fork to Return DAO Funds". If you tell me I'm strawmanning ETH for BTC (or whatever other bullshit three-letter acronym) I answer this: it does not matter. Something that happens in one, will happen in another. The precedent has been set, the path is clear.
> At point 3, you seem to be strawmanning ETH for BTC, where it seems the user you're replying to is referring to BTC.
Doesn't matter. Bitcoin is just as susceptible. And no, Lightning will not save it (for obvious reasons which are totally glossed over by the dreamy-eyed proponents).
> Early tech is early tech. We all know this.
Yes. We know this. Cryptocurrency proponents seem to remember this fact only after being confronted with reality.
See how this conversation played out:
- Day to day transactions are actually the most likely to be disrupted by crypto. The reason for this is crypto can trade with almost zero fees
- No, the fees are not zero. In fact, they are prohibitively high, and unpredictable
- Yes, but... but.. the transactions are non-reversible, and there's fraud protection
- There is at least one precedent of a cryptocurrency being hard forked to reverse transactions. Fraud is already being handled. etc. etc.
- Yes, but.. but... it's early tech!
Indeed. It's early tech with very few, if any, practical uses. With exorbitant unpredictable fees, extremely slow transactions, overall inefficiency etc. etc. etc. And yet for some reason it's hailed as the saviour of everyone and everybody now even though it offers a near-zero improvement on what we already have today.
Bitcoin is the best cryptocurrency. I expect that bitcoin will beat the record this year too) Because I want to buy bitcoins. What is the best way to do this? Apparently it's buy bitcoins with paypal ( https://bitcoinbestbuy.com/how-buy-bitcoins-paypal/ ). Or I'm wrong?
Oh. And let's not forget http://dayssinceacryptocurrencyexchangehaslostmorethan100mil...
You are hallucinating here, please reread our exchange.
Your conflation of ETH and BTC is disingenuous.
What were your thoughts on the iPhone when it came out?
Your conflation of ETH and BTC is disingenuous.
What were your thoughts on the iPhone when it came out?
If fees are close to zero, then how do miners get paid?
In the bitcoin world, they earn a mining reward of 12.5 BTC.
The mining reward will eventually drop to 0 BTC though.
the idea is that by that time there will be so many transactions that the fees will fill that. also, if users are also miners they have an incentive to continue the BTC network for their own self benefit even if the fees were less.
> the idea is that by that time there will be so many transactions that the fees will fill that
This comes with its own scalability issues which are currently unsolved (and might well be unsolvable)
> also, if users are also miners they have an incentive to continue the BTC network for their own self benefit even if the fees were less.
This is equivalent to the users themselves paying fees, but much less secure, stable, and decentralized.
This comes with its own scalability issues which are currently unsolved (and might well be unsolvable)
> also, if users are also miners they have an incentive to continue the BTC network for their own self benefit even if the fees were less.
This is equivalent to the users themselves paying fees, but much less secure, stable, and decentralized.
We'll need two things in a crypto-utopia
1. Decentralized derivative adjusted assets. Basically you are holding a contract of 100 Units (instead of 100USD) that represent a decentralized smart contract which trades against other cryptos. Crypto goes up or down but your contract holds a stable value.
2. Automatic search for gateways and routing of transactions. The merchant just shows you the amount in the universal unit (ie: 35 Units) and a QR Code. You scan the QR code and the merchant is paid. The applications and blockchains figure out the rest and connects the different blockchains together.
1. Decentralized derivative adjusted assets. Basically you are holding a contract of 100 Units (instead of 100USD) that represent a decentralized smart contract which trades against other cryptos. Crypto goes up or down but your contract holds a stable value.
2. Automatic search for gateways and routing of transactions. The merchant just shows you the amount in the universal unit (ie: 35 Units) and a QR Code. You scan the QR code and the merchant is paid. The applications and blockchains figure out the rest and connects the different blockchains together.
Yes, or a bunch of coins in your pocket. Not so utopic, but they don't require data access and require no electricity.
He doesn't see people being willing, en masse, to convert the currency they receive (in a paycheck, for example)
I think he meant in the short term, didnt he? In the long term, this is obviously wrong. For two reasons. 1) You dont get a craze like we are witnessing when people dont like the technology. At some point, you have to stop making things complicated: people want it, they are not afraid of it, they are damn excited about it. It's the new gold rush. 2) Cryptocurrencies, once mature, will offer a significant increase in banking quality, innovation and competition. Your current banking system and VISA are 19th-century in comparison of what's coming.
In short, we have: people-love-it + old-system. I call the result of that equation obvious on the long term.
I think he meant in the short term, didnt he? In the long term, this is obviously wrong. For two reasons. 1) You dont get a craze like we are witnessing when people dont like the technology. At some point, you have to stop making things complicated: people want it, they are not afraid of it, they are damn excited about it. It's the new gold rush. 2) Cryptocurrencies, once mature, will offer a significant increase in banking quality, innovation and competition. Your current banking system and VISA are 19th-century in comparison of what's coming.
In short, we have: people-love-it + old-system. I call the result of that equation obvious on the long term.
I look forward to that glorious day when Bitcoin, now mature, has crushed the global financial system and established a new era of whale dominance. I'm just not sure that I have enough years left in me to wait until the impossible future arrives...
I'm not sure there's much of a chicken and egg problem at all. The cryptocurrency adoption has steadily increased so far.
If anything the biggest problem is understanding how to use cryptocurrencies in the first place. For mass adoption that's where we need to see innovation most (and of course scalability, which is directly tied to mass adoption).
I don't see the government adopting/not adopting a cryptocurrency affect adoption in a major way on its own. People who don't understand how to use cryptocurrency still wouldn't use it unless it was forced upon them somehow, like their employer saying their salary will be exclusively offered as cryptocurrency from the next month forward. But that could cause all sorts of issues.
If anything the biggest problem is understanding how to use cryptocurrencies in the first place. For mass adoption that's where we need to see innovation most (and of course scalability, which is directly tied to mass adoption).
I don't see the government adopting/not adopting a cryptocurrency affect adoption in a major way on its own. People who don't understand how to use cryptocurrency still wouldn't use it unless it was forced upon them somehow, like their employer saying their salary will be exclusively offered as cryptocurrency from the next month forward. But that could cause all sorts of issues.
>The cryptocurrency adoption has steadily increased so far.
For speculation and investment, not for anything currency-like, though.
For speculation and investment, not for anything currency-like, though.
Why is that do you think?
I'd say lack of transaction speed, they're not easy to use, and almost all crypto-currencies lack privacy. Should everyone in the world get to know that I stupidly bought a soda from the vending machine at 3pm? Or worse..
It's nice that they take a positive approach to management and regulation, but it's too bad they're so strict about who they let in. I believe if you're an EU citizen you have a path to get in and start a business, but if you're American it seems you're not welcome (unless you start with a lot of funding and basically buy your way in).
The Netherlands will let an American come start a business with only (about) 5,000 € and a bit of paperwork, plus another 1,400 in fees. NL isn't making a great effort to attract blockchain businesses, but they do benefit from the generally calm EU regulatory approach to the new technologies.
The Netherlands will let an American come start a business with only (about) 5,000 € and a bit of paperwork, plus another 1,400 in fees. NL isn't making a great effort to attract blockchain businesses, but they do benefit from the generally calm EU regulatory approach to the new technologies.
The robust political system and wealthy quite egalitarian society is a nice environment to run your company in but is also the reason that the next step of the cryptocurrency revolution will not happen here.
Cryptocurrencies are still 100% hype & speculation; a solution in search of a problem. Unless it delivers some real-world applicability i'm not very happy about the reputational risk we expose our country too as i'm strictly in the camp of that it will all come crashing down in a big bang soon.