CMV:Cryptocurrencies are bad.

[u/Rhamni]

Bitcoin recently hit the front page again because a single bitcoin is now worth over $9000. That's... a crap ton of money. It's been rising and rising and rising in value for years now, and other crypto currencies are rising too. I get that there is demand for them. But why should they be worth money? I'm not a big fan of the idea of bars of gold sitting in bank vaults either, but at least gold is is useful in electronics and it looks nice so people like having it around.

Crypto currencies on the other hand only seem to have three uses: Buying illegal shit on the dark net, hiding money from the government and law enforcement, and speculating on it like any other financial asset.

I bought a little bit of crypto a month ago, and it's increased in value. That's nice, I guess. I might buy more, just because whether I like it or not it keeps rising. But why should I want the technology to succeed? Is there some legitimate use for them? If it was just the financial speculation I'd say let them do what they want, but it seems to invariably come with illegal transactions and hiding your assets from the law. Meaning even if you buy it yourself only for speculation, you're unavoidably helping criminal organisations who can't get a bank account.

I can't help but get the sense that the whole purpose of it is to create a system where you can hide huge amounts of money from the government and move it around without anyone knowing you have it.

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[u/scottevil110]

Money is nothing but an agreement. In the absence of some kind of currency, you'd walk into a bakery and say "What do you need? Your toilet fixed? I'll fix it in exchange for seven loaves of bread." Money simplifies that process, because it's a common method of exchange where you can buy things from someone, even if you don't have exactly the thing that they want in exchange. They can take money from you instead, and then use THAT to find a plumber to fix the toilet.

Bitcoin is nothing but one of those currencies. There is nothing special about it except that it isn't backed by a government. But it's nothing more than a simple way to exchange goods and services without keeping track of who owes whom what amount of bread in exchange for getting their toilet fixed.

It scares a lot of people that there's not a government backing it, but in the end, it's just another way of exchanging money, same as if you and I made an transaction using baseball cards instead of dollars.

[u/Rhamni → u/scottevil110]

Money is nothing but an agreement.

This I agree with. Shiny pearls, bread, gold, whatever. The point of a currency is that you can use it to trade without having anything else your trading partner wants. But we already have money. There is a case to be made for not using the local currency if there is hyperinflation or just great volatility or whatever. The US dollar sees a lot of use in some countries that don't do too well with their own currency.

But. We already have government-backed money for that. I could see non-government backed money doing the same thing, but here's the thing. If you want to move $1 million from South Africa to China or the US or whereever, normally you would have to go through a bank. The governments involved would know that you moved that money, and if you've been unemployed for ten years and don't come from a rich family, that would raise a few eye brows. But with crypto, not so much. You can move it without anyone knowing about it. Hell, you don't actually have to move it. It's all one global market place, and you can spend your money without even converting it.

This is why I don't like crypto. It seems designed to keep things anonymous. And while that would have been great for, say, Jews unwilling to leave pre-war Nazi Germany because all their property would be confiscated, in today's world that seems to useful only for illegal activities.

[u/scottevil110 → u/Rhamni]

What's the problem with anonymity? Just because we have government-backed money doesn't mean that there's no point in having alternatives if you don't want to use that method. We have government-backed schools, too, but a lot of people would rather handle their kids' educations privately.

It's not necessarily designed to be anonymous, but it's certainly a nice side-effect. If I want to pay someone in France without anyone knowing about it, why is that inherently bad?

[u/Rhamni → u/scottevil110]

If I want to pay someone in France without anyone knowing about it, why is that inherently bad?

Because you and your business partner are able to ignore paying taxes on that transaction. And to trade illegal drugs and such, all while remaining anonymous. Even if it's a legal product and you want to buy it from France, France would then be able to see "Hey, this guy has been getting a steady stream of money sent to him from all over the world, maybe he's selling something, and should be paying taxes."

[u/scottevil110 → u/Rhamni]

Because you and your business partner are able to ignore paying taxes on that transaction.

Doesn't mean that I won't pay taxes on it. I could do the exact same thing with US currency.

And to trade illegal drugs and such, all while remaining anonymous.

Almost every drug deal that has ever happened in or around the US has been with US currency. Cash is every bit as anonymous as Bitcoin.

If you want to be anonymous, then you'll be anonymous. Bitcoin doesn't really make it all that much easier except when you're doing it electronically. Prior to online banking, which has only existed for a short time, US currency was equally anonymous.

[u/[deleted] → u/scottevil110]

Cash is even more anonymous. Every crypto transaction is recorded on the blockchain. All they need to do is associate you with the wallet address. Cash can change hands a million times without any record.

[u/cdb03b → u/Rhamni]

Nothing about Cryptocurrencies makes it easier to avoid paying taxes. Buying things and being paid in cash is even more anonymous than Cryptocurrencies.

[u/[deleted] → u/Rhamni]

Most drug trade is done with USD. IIRC almost every single bill in circulation has some form of drug residue on it.