Charlie Munger calls BTC disgusting and contrary to the interest of civilization(cnbc.com)
cnbc.com
Charlie Munger calls BTC disgusting and contrary to the interest of civilization
https://www.cnbc.com/2021/05/01/charlie-munger-calls-bitcoin-disgusting-and-contrary-to-the-interests-of-civilization.html
83 comments
I mean he is kinda right about the energy use being "disgusting". Very hard to justify that much juice on literally useless calculations.
Their anger beyond that seems somewhat more deep seated than that though
Their anger beyond that seems somewhat more deep seated than that though
The other thing that isn't fantastic is the use of crypto to facilitate all manner of crime from illegally selling weapons to trafficking humans.
To verify a single transaction, the network uses 1150kWh of energy which produces 550kg of CO2 [1].
[1] https://digiconomist.net/bitcoin-energy-consumption/
[1] https://digiconomist.net/bitcoin-energy-consumption/
This is wrong, the number of transactions has (almost) nothing to do with the energy usage. I wrote almost in brackets because the transaction fees contribute slightly to the total compensation of the miners. So it is mostly the block reward that determines the energy usage (for now)
I can veryfy all Bitcoin transactions ever happened on the network on my laptop in a few days, I'm sure it's less than that, my Apple M1 laptop is quite energy efficient.
Parent said network not just a single machine.
That includes the cost of mining without which your computer would not be able to verify the transaction.
That includes the cost of mining without which your computer would not be able to verify the transaction.
The mining is not needed at all for verifying transactions, it is used to secure the network and to create new block of transactions.
This is just false.
New blocks are created with transactions in them and can’t be verified if they haven’t been mined, because verification works by checking the hash that the miner found.
Transactions that are not yet part of a mined block cannot be verified.
New blocks are created with transactions in them and can’t be verified if they haven’t been mined, because verification works by checking the hash that the miner found.
Transactions that are not yet part of a mined block cannot be verified.
What you wrote is all correct. Just don’t confuse creating the transaction and adding to the network (which is relatively expensive) with verifying (which is cheap, an SHA-256 hash can be computed in 2 days by a human with pen and paper, and for verifying the transaction you need an exponentiation on an elliptic curve, which is still efficient, though slower).
Sure, but a transaction cannot be verified without first being part of a mined block.
So paying the cost of mining is a prerequisite for verification.
You can definitely separate out the costs, but it’s misleading to imply that mining isn’t a requirement and that you also have to pay that cost first.
And a statement like this…
> The mining is not needed at all for verifying transactions, it is used to secure the network and to create new block of transactions.
…isn’t correct - mining is needed for verification. You cannot have verification of new transactions without mining.
So paying the cost of mining is a prerequisite for verification.
You can definitely separate out the costs, but it’s misleading to imply that mining isn’t a requirement and that you also have to pay that cost first.
And a statement like this…
> The mining is not needed at all for verifying transactions, it is used to secure the network and to create new block of transactions.
…isn’t correct - mining is needed for verification. You cannot have verification of new transactions without mining.
No one every called the resources to drive a bunch of cash around a waste, don't you wonder why? Calling it useless won't make people stop using it.
Which brings me to an imortant question, has anyone done a rough math as to the overall (1)cost of using bitcoin versus the using regular currency?
My guess is that for bitcoin would be _significantly_ lower.
(1)= should include the cost of printing, machinery, guarding, maintaining, ensuring uniqueness, non-forgability, distributing, inflation etc.
My guess is that for bitcoin would be _significantly_ lower.
(1)= should include the cost of printing, machinery, guarding, maintaining, ensuring uniqueness, non-forgability, distributing, inflation etc.
Hold my beer while I pollute the environment with this poison to mine for gold and other precious metals!
Sounds like that one time the gold rush in the United States killed like 100 species and then drained all of the swamp in California which most California was just to feed the gold rushers you know like completely destroy and change the native surroundings of an entire humongous State just so you can have a little bit of gold and sell some shovels. And then 100 years later wonder why there's a massive environmental problems like water shortages
They are excessive but not 'literally useless' - there's clearly a use, it just would be a lot better if that use was being served with less energy.
Not that I particularly like BTC at this point - it has been largely superseded by better projects.
Not that I particularly like BTC at this point - it has been largely superseded by better projects.
Bitcoin has been superseded by better projects like? care to give some examples?
I'd argue that every non-PoW blockchain is better than Bitcoin. Specifically smart-chains do both what Bitcoin does but also the coin is actually useful beyond a store of value (which they can also be used for). So e.g. Ethereum 2.0, Cardano, Solana etc are all better on everything Bitcoin is criticized for.
And if we talk about pure payments, projects like Stellar, Nano (yes, issues currently but getting fixed), and Monero have clear (different) benefits over it.
And if we talk about pure payments, projects like Stellar, Nano (yes, issues currently but getting fixed), and Monero have clear (different) benefits over it.
Bitcoin (or crypto in general) might be becoming one of the most divisive while really popular topics here. You rarely see quite that many downvotes on all sides on frequently discussed subjects.
Currency and money are weird and ancient concepts, in my view.
Of course they are part of society as common tools, but money can be corrupt or just a misleading way to measure value in society, especially with ecology and a very sophisticated society.
With the end of the cold war and the soviet union, there will be an endless supply of people arguing against planned economy, while it's clearly undeniable that all modern world governments are somewhat already centralized in a way or another, would it be by law, lobbies, government or monopolies.
It's really weird how bitcoin showed that normal banks are actually the best way to handle money. Government-regulated currencies are best because voters can actually have a saying in how money gets handled. You cannot say such thing about BTC. BTC is at the mercy of malware and BTC-to-dollar exchanges.
BTC really is the most shiny software gadget ever invented. Most people don't know how it work.
Of course they are part of society as common tools, but money can be corrupt or just a misleading way to measure value in society, especially with ecology and a very sophisticated society.
With the end of the cold war and the soviet union, there will be an endless supply of people arguing against planned economy, while it's clearly undeniable that all modern world governments are somewhat already centralized in a way or another, would it be by law, lobbies, government or monopolies.
It's really weird how bitcoin showed that normal banks are actually the best way to handle money. Government-regulated currencies are best because voters can actually have a saying in how money gets handled. You cannot say such thing about BTC. BTC is at the mercy of malware and BTC-to-dollar exchanges.
BTC really is the most shiny software gadget ever invented. Most people don't know how it work.
> Government-regulated currencies are best because voters can actually have a saying in how money gets handled
No, they don't. BTC is successful because citizens were against bailouts and yet government did bailouts to secure the "common good"
It's also popular because the Fed has a 2% inflation target whereas the population prefers a -2%
Government can kill btc in 3 seconds if it wants to do so...it just needs to give people what they want, what's popular so to speak, regardless of outcomes
No, they don't. BTC is successful because citizens were against bailouts and yet government did bailouts to secure the "common good"
It's also popular because the Fed has a 2% inflation target whereas the population prefers a -2%
Government can kill btc in 3 seconds if it wants to do so...it just needs to give people what they want, what's popular so to speak, regardless of outcomes
I feel like in all of these near-focus discussions one very important thing tends to get lost. its that Bitcoin is the first realistic attempt to take the power of issuing money away from politicians & central bankers. we all know it is not perfect but we have to acknowledge if it becomes a bit stable and more players buy into it then there is a good chance it could be a currency hedge commodity like gold or other precious metals. eventually its possible that many small currencies can be keyed off of it directly or indirectly by easy convertibility. In that bitcoin itself may not succeed but IMO some other block-chain based effort would. I think given the size of world economy & currency markets, a couple of trillion USD of market cap may be justifiable if it becomes successful in that.
Why are all these billionaires singling out bitcoin?
They likely mean any cryptocurrency. Bitcoin is simply the only type that is generally known and hence synonymous with all things crypto.
Well, in this case this was during a Q&A session, so he was likely asked about bitcoin by shareholders (it was a shareholder meeting) to get his opinion.
Plus he makes it clear in the article that he finds it distasteful "shuffling out of your extra billions of billions of dollars to somebody who just invented a new financial product out of thin air."
Which I mean, if you're somebody who has "extra billions of dollars" lying around, you might not care to shuffle it around either.
As for other billionaires, at least one is actually into bitcoin (Elon Musk).
Plus he makes it clear in the article that he finds it distasteful "shuffling out of your extra billions of billions of dollars to somebody who just invented a new financial product out of thin air."
Which I mean, if you're somebody who has "extra billions of dollars" lying around, you might not care to shuffle it around either.
As for other billionaires, at least one is actually into bitcoin (Elon Musk).
I’m just hoping we get soon to the collapse of bitcoin so we can either normalize better cryptos or just abandon the concept of cryptocurrency as a whole.
Right now we are just inflating the proverbial balloon until it pops.
Right now we are just inflating the proverbial balloon until it pops.
Looks like Buffet/Munger have moved from the denial stage to the anger stage?
One BTC transaction consumes more energy than million visa transactions. BTC is the most energy inefficient financial transaction system ever developed.
Exactly, it is taxing our environment and will so ever more. Sooner or later it will become unbearable and will need to be regulated, simply due to its contribution to climate change. Let's hope that it can be regulated, even. It is by design not sustainable and we have just one planet.
> It is by design not sustainable
I've only read the Bitcoin whitepaper a few times, so I might not have a 100% understanding but I've missed this point in every single reading. Could you point out the section where this "Bitcoin should not be sustainable" is outlined in the original paper?
I've only read the Bitcoin whitepaper a few times, so I might not have a 100% understanding but I've missed this point in every single reading. Could you point out the section where this "Bitcoin should not be sustainable" is outlined in the original paper?
It’s in the Proof of Work. The „..difficulty is determined by a moving average targeting an average number of blocks per hour.“ The more nodes, the faster the hash rate the higher the difficulty. Here is a nice (exponential) graph showing difficulty over time since 2010 http://bitcoin.sipa.be
And „The average work required is exponential in the number of zero bits required and can be verified by executing a single hash.“
The difficulty of a unit of work can be practically limitless, the difficulty to verify a unit of work is practically nil. As long as work needs to be performed and as long as the network keeps growing, both the total amount of work and the amount of work per unit of work increase. The required energy of the network increases with them as long as the machines do not get efficient faster, which is highly unlikely.
Currently, the energy footprint of one BTC transaction is estimated to be 612 kWh and the estimated electricity demand increased over 10.000 % between 2015 and 2021. Digital currencies reportedly account for 112 TWh energy consumption per year in the top 10 countries. That is in the ballpark of the total electrical energy consumption of all 41,500,000 German households. (https://www.institutionalassetmanager.co.uk/2021/01/20/29466..., https://digiconomist.net/bitcoin-energy-consumption/ and https://www.cleanenergywire.org/factsheets/germanys-energy-c... and https://www.statista.com/statistics/464187/households-by-siz... ).
Blockchain currencies with alternative consensus algorithms are better in this regard.
And „The average work required is exponential in the number of zero bits required and can be verified by executing a single hash.“
The difficulty of a unit of work can be practically limitless, the difficulty to verify a unit of work is practically nil. As long as work needs to be performed and as long as the network keeps growing, both the total amount of work and the amount of work per unit of work increase. The required energy of the network increases with them as long as the machines do not get efficient faster, which is highly unlikely.
Currently, the energy footprint of one BTC transaction is estimated to be 612 kWh and the estimated electricity demand increased over 10.000 % between 2015 and 2021. Digital currencies reportedly account for 112 TWh energy consumption per year in the top 10 countries. That is in the ballpark of the total electrical energy consumption of all 41,500,000 German households. (https://www.institutionalassetmanager.co.uk/2021/01/20/29466..., https://digiconomist.net/bitcoin-energy-consumption/ and https://www.cleanenergywire.org/factsheets/germanys-energy-c... and https://www.statista.com/statistics/464187/households-by-siz... ).
Blockchain currencies with alternative consensus algorithms are better in this regard.
No, I don't think GP is referring to Proof of Work here. Proof of Work is designed to be difficult and to enable securing of a network. Nowhere in the design of Proof of Work is it said that it has to not be sustainable, which was the main argument. So GP must have meant something else.
You are right, I also do not think that it is intentional, but just incidental insustainable. It is still an inherent and central part of its design.
Maybe that is the price of censorship resistance. Maybe that is the price of sound money. Maybe if you don’t have a system like this imperial hegemonic nations like the US will print money to stay ahead with impunity. Maybe, for all those things, that’s a price worth paying.
I’m sorry but this is just appeal to emotion that does not match the current reality of Bitcoin. In what way is Bitcoin “sound”? It’s volatile, opaque, and at the peak of the frenzy (i.e. when usage was high) transactions were both expensive, and slow.
I don’t see how the existence of BTC prevents the US Treasury from printing money. In some theoretical scenario maybe, but not in actuality. And I don’t buy that BTC is going to empower “the little guy”. Coinbase, the most accessible way to trade cryptocurrencies is now beholden to Wall Street and there are concerns about the amount of control China has over BTC [0]. The same people in control now will try to retain if the rules of the game change.
[0] https://www.investopedia.com/news/bitcoin-wont-win-worldwide...
I don’t see how the existence of BTC prevents the US Treasury from printing money. In some theoretical scenario maybe, but not in actuality. And I don’t buy that BTC is going to empower “the little guy”. Coinbase, the most accessible way to trade cryptocurrencies is now beholden to Wall Street and there are concerns about the amount of control China has over BTC [0]. The same people in control now will try to retain if the rules of the game change.
[0] https://www.investopedia.com/news/bitcoin-wont-win-worldwide...
It’s a feedback mechanism. The fed will always worry that if they get too loose the rich will dump all their money into gold and land and art and whatever pristine investments they can buy to avoid inflation. Guess what is the perfect digital equivalent to these things?
Conspiracy theories, money mystism and emotional rants.
"Surrender to the US monetary global hegemony for the enviroment"
Or build another one where trust doesn’t require burning down a planet.
Comments made during Berkshire annual (remote) meeting yesterday.
Interesting take and in line with what he said in the past,
Druckenmiller and Soros on the other hand are bullish
Interesting take and in line with what he said in the past,
Druckenmiller and Soros on the other hand are bullish
Who says you cannot be bullish on something that is disgusting? There is a lot of money made with Food, Water, Weapons etc.
Bitcoin is Pachinko for middle-aged white men.
You can quote me on that.
(And, really, do some research into the $200B a year Pachinko industry, and you’ll see some disturbing parallels.)
You can quote me on that.
(And, really, do some research into the $200B a year Pachinko industry, and you’ll see some disturbing parallels.)
First they ignore, then they laugh, then they fight, then you win.
Or then you lose
[deleted]
Or then they buy you and make you danse like the monkey you have always been.
The elites are disgusting and contrary to the interests of civilization.
You're disgusting and contrary to the interests of civilization, and you're disgusting and contrary to the interests of civilization, and you're disgusting and contrary to the interests of civilization!!
Everyone is disgusting and contrary to the interests of civilization!
Everyone is disgusting and contrary to the interests of civilization!
BTC does nothing more than slightly expand the set of elites. If anything, its distribution is much more lopsided than that of fiat money.
People have found a new scapegoat for energy use so they can feel less guilty about their meat heavy diet and heavy carbon footprint.
“Bitcoin is an energy grabbing monster that’s killing our planet!!! (And not us we swear!)
“Bitcoin is an energy grabbing monster that’s killing our planet!!! (And not us we swear!)
I'm all for greater accountability of big corp when it comes to climate change, but did I miss where they said "it's not us, we swear"?
It will be much more difficult to replace fossil fuels, which have a direct upside (keeping a big chunk of the world moving, chemical industry, etc), despite the eco-devastation. I'm yet to see which fundamental, irreplaceable need cryptocurrencies fill.
Also, as a note, fossil fuels and mass meat production started in a time where climate change was not a concern. They are deeply ingrained in the majority of societies, even though the trend since the end of the last century is to divest.
I see the exact opposite in cryptocurrencies. They started to become mainstream in a period were people should know better about these things and the trend is to grow even more.
It will be much more difficult to replace fossil fuels, which have a direct upside (keeping a big chunk of the world moving, chemical industry, etc), despite the eco-devastation. I'm yet to see which fundamental, irreplaceable need cryptocurrencies fill.
Also, as a note, fossil fuels and mass meat production started in a time where climate change was not a concern. They are deeply ingrained in the majority of societies, even though the trend since the end of the last century is to divest.
I see the exact opposite in cryptocurrencies. They started to become mainstream in a period were people should know better about these things and the trend is to grow even more.
> They started to become mainstream in a period were people should know better about these things
They should know better about the climate but they also know better that you cannot trust the US financial system so its better to have a hedge in the form of crypto.
They should know better about the climate but they also know better that you cannot trust the US financial system so its better to have a hedge in the form of crypto.
Farming corporations do it constantly they're by far the biggest wasters of water but they run ad campaigns telling you to turn the faucet off when you're brushing your teeth. The dump so much NPK in the fields now that they're destroying our waterways then they claim it's not farming corporation practices it's all the sewer from the people
> I'm all for greater accountability of big corp when it comes to climate change, but did I miss where they said "it's not us, we swear"?
Corporations gaslight consumers all the time for anything inconvenient to them and their profits.
If you want to see a good case made for one example of it, plastics and plastic recycling, check out John Oliver's Last Week Tonight on plastics (you probably even believe a few of the lies they've been telling everyone about plastic recycling yourself right now. it even surprised me and I already knew plastic recycling was a little bit bullshit already).
https://youtu.be/Fiu9GSOmt8E
Here's a whole 11 episode podcast put out by the BBC called "How They Made Us Doubt Everything" about big business using the same techniques to tell us lies about smoking causing cancer to make us doubt climate change. I just found out about this now but I do intend to give it a listen:
https://www.bbc.co.uk/programmes/m000l7q1
Here's an article that's an excerpt from a book called "The New Climate War" that Michael Mann wrote about this very topic:
"Then there’s the now iconic “Crying Indian” ad. Some readers may recall the commercial from the early 1970s. Featuring a tearful Indian named “Iron Eyes Cody,” it alerted viewers to the accumulating bottle and can waste littering our countryside. The ad, however, wasn’t quite what it appeared to be on the surface. A bit of sleuthing reveals that it was actually the centerpiece of a massive deflection campaign engineered by the beverage industry, which sought to point the finger at us, rather than corporations, emphasizing individual responsibility over collective action and governmental regulation."
https://www.sciencefriday.com/articles/michael-mann-climate-...
Not really in the mood to argue the crypto front. I'm actually in a bit of a quandary myself, as I was excited about bitcoin when it was first released, and didn't see how much energy it would eventually use, and I actually have some wealth (modest in these circles since a lot of you work in Silicon Valley and I don't) thanks to speculating on it and other cryptocurrencies.
I want to see crypto succeed, but I also want it to not use tons of energy. I'm aware of alternatives to "Proof of Work" (which is why Crypto has started using so much energy) such as "Proof of Stake", but it's not going to be easy to shift Bitcoin to that, and as far as I'm aware we don't yet have any coin that's proven that Proof of Stake will work at scale yet (although Ethereum is working towards that, so hopefully it will show that more environmentally-friendly alternatives can exist).
So long story short, I'm hoping that ultimately the environmental issues of bitcoin will eventually be significantly fixed, or people will shift to a coin that does fix it.
In the meantime, however, there's tons of other industries that are severely damaging our environment and are doing little to nothing to stop it, and blaming everyone else for the problem instead of us.
Corporations gaslight consumers all the time for anything inconvenient to them and their profits.
If you want to see a good case made for one example of it, plastics and plastic recycling, check out John Oliver's Last Week Tonight on plastics (you probably even believe a few of the lies they've been telling everyone about plastic recycling yourself right now. it even surprised me and I already knew plastic recycling was a little bit bullshit already).
https://youtu.be/Fiu9GSOmt8E
Here's a whole 11 episode podcast put out by the BBC called "How They Made Us Doubt Everything" about big business using the same techniques to tell us lies about smoking causing cancer to make us doubt climate change. I just found out about this now but I do intend to give it a listen:
https://www.bbc.co.uk/programmes/m000l7q1
Here's an article that's an excerpt from a book called "The New Climate War" that Michael Mann wrote about this very topic:
"Then there’s the now iconic “Crying Indian” ad. Some readers may recall the commercial from the early 1970s. Featuring a tearful Indian named “Iron Eyes Cody,” it alerted viewers to the accumulating bottle and can waste littering our countryside. The ad, however, wasn’t quite what it appeared to be on the surface. A bit of sleuthing reveals that it was actually the centerpiece of a massive deflection campaign engineered by the beverage industry, which sought to point the finger at us, rather than corporations, emphasizing individual responsibility over collective action and governmental regulation."
https://www.sciencefriday.com/articles/michael-mann-climate-...
Not really in the mood to argue the crypto front. I'm actually in a bit of a quandary myself, as I was excited about bitcoin when it was first released, and didn't see how much energy it would eventually use, and I actually have some wealth (modest in these circles since a lot of you work in Silicon Valley and I don't) thanks to speculating on it and other cryptocurrencies.
I want to see crypto succeed, but I also want it to not use tons of energy. I'm aware of alternatives to "Proof of Work" (which is why Crypto has started using so much energy) such as "Proof of Stake", but it's not going to be easy to shift Bitcoin to that, and as far as I'm aware we don't yet have any coin that's proven that Proof of Stake will work at scale yet (although Ethereum is working towards that, so hopefully it will show that more environmentally-friendly alternatives can exist).
So long story short, I'm hoping that ultimately the environmental issues of bitcoin will eventually be significantly fixed, or people will shift to a coin that does fix it.
In the meantime, however, there's tons of other industries that are severely damaging our environment and are doing little to nothing to stop it, and blaming everyone else for the problem instead of us.
The headline does make it seem like it's about the environmental footprint, but his actual quote in the article doesn't seem to be about that. He just doesn't like giving money to financial products "created out of thin air".
That being said, you're right in regards to other people who are definitely scapegoating it.
That being said, you're right in regards to other people who are definitely scapegoating it.
> He just doesn't like giving money to financial products "created out of thin air".
and yet he supports bailouts for reckless financial institutions by printing money created out of thin air.
and yet he supports bailouts for reckless financial institutions by printing money created out of thin air.
Good point. Even reading the article I assumed that but at no point that gentleman mention consumption indeed.
If he concern about the “thin-air” aspect, someone has to tell him about the thin-air aspect of most financial things.
If he concern about the “thin-air” aspect, someone has to tell him about the thin-air aspect of most financial things.
It's interesting because if anything, it's the current financial system that's created out of thin air.
So what? It exists, and it's decentralised, and it solves many people's needs (and yes, these needs are usually criminal in nature, so they are not even supposed to be in the interest of civilization). Outlaw it and this is all they want - because it means unchecked existence.
Read an interesting article that stated that crypto is not private enough to enable good money transfer for criminals. Cash is still the best. In general it stated that crypto currencies are rather useless.
https://www.currentaffairs.org/2021/04/why-cryptocurrency-is...
And a couple notes about blockchain https://thecorrespondent.com/655/blockchain-the-amazing-solu...
Personally I have not dig deeper into the pros and cons of crypto but my gut feeling is that it’s pretty useless.
Would be better to improve existing structures.
https://www.currentaffairs.org/2021/04/why-cryptocurrency-is...
And a couple notes about blockchain https://thecorrespondent.com/655/blockchain-the-amazing-solu...
Personally I have not dig deeper into the pros and cons of crypto but my gut feeling is that it’s pretty useless.
Would be better to improve existing structures.
Most cryptos as they are now are useless. Yes. The tech is not great and from a developer or entrepreneur standpoint it’s ... messy and hard to build on.
But what’s emerging now is faster, lighter, better documented, and you would not believe it but it’s true: some even serve a true purpose around the “trust-less” idea.
It’s around, deploying as we speak.
But what’s emerging now is faster, lighter, better documented, and you would not believe it but it’s true: some even serve a true purpose around the “trust-less” idea.
It’s around, deploying as we speak.
What examples do you have in mind?
You should dig a little deeper, so that you get an actual understanding instead of a gut feeling about something you don't know anything about. Read about the technology, learn how it works, read what proponents like about it and what opponents dislike about it. That way you can form a proper opinion.
This seems like a poorly researched article though. They didn't even mention any privacy coins that do offer privacy or at least plausible deniability like Monero.
I admittedly just skimmed it, but I also didn't see them refute Bitcoin as a store of value.
I admittedly just skimmed it, but I also didn't see them refute Bitcoin as a store of value.
Ok, so you can't get any privacy when using Bitcoin, let's say you use Monero instead.
So you kidnap someone, demand a payment in Monero and the family pays it. So now you have X Monero. Now what? In order to use it for something, either you need to purchase it with Monero (meaning you can only buy things like drugs and other illicit things, no popular stores offers Monero as payment), or you trade Monero for Y-coin and lose your privacy again or you sell Monero on a exchange for Z, again losing your privacy.
Replace Monero with any other "privacy" coin and you have the same problem.
Cryptocurrencies with public ledgers, "privacy" focused on not are simply not a good solution for crimes and preventing people from finding you. The best tool for that job is still cash.
So you kidnap someone, demand a payment in Monero and the family pays it. So now you have X Monero. Now what? In order to use it for something, either you need to purchase it with Monero (meaning you can only buy things like drugs and other illicit things, no popular stores offers Monero as payment), or you trade Monero for Y-coin and lose your privacy again or you sell Monero on a exchange for Z, again losing your privacy.
Replace Monero with any other "privacy" coin and you have the same problem.
Cryptocurrencies with public ledgers, "privacy" focused on not are simply not a good solution for crimes and preventing people from finding you. The best tool for that job is still cash.
> you trade Monero for Y-coin and lose your privacy again
This seems to work fine, though. If Y coin is Bitcoin, all anyone can tell is you traded Monero for Bitcoin. They can't go and track where the Monero came from as they could with Bitcoin. It gives plausible deniability.
This seems to work fine, though. If Y coin is Bitcoin, all anyone can tell is you traded Monero for Bitcoin. They can't go and track where the Monero came from as they could with Bitcoin. It gives plausible deniability.
So the IRS asking questions as to how you got all that monero is not an issue?
How are you performing this "Monero for Bitcoin" trade without loosing your privacy to at least the person/entity you're trading with? You can't.
I felt that article was well written with an outsider point of view and asking very interesting questions.
It seems that he doesn’t like BTC because it’s unregulated, highly volatile, and could be used for illegal behavior (I hope he doesn’t figure out what many people use USD for).
Having worked in crypto for a little while, I do sort of agree with Charlie on his last point to some extent:
“Bitcoin reminds me of what Oscar Wilde said about fox hunting. He said it was the pursuit of the uneatable by the unspeakable,” he added.
I just don’t see any interesting use cases in crypto that don’t look like Ponzi schemes. The ecosystem is bifurcated into scam artists and philosopher engineers who work on impressive infrastructure projects to nowhere. The most popular crypto isn’t scalable or has governance issues. It’s so expensive to send and receive money on most of these block chains that they can’t even be used for basic commerce.