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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsRepublicans suddenly love crypto. Americans should beware. (WP)
https://www.washingtonpost.com/opinions/2024/08/03/crypto-bitcoin-lobby-trump-vance/https://archive.ph/CfNqq
Republicans suddenly love crypto. Americans should beware.
The cryptocurrency lobby is lining up behind Donald Trump. Voters should see nothing good in this.
By the Editorial Board
August 3, 2024 at 6:00 a.m. EDT
When he was president a few years ago, Donald Trump called it “a scam.”
Nothing much has changed about cryptocurrency since then. In fact, the biggest news has been the spectacular crash of cryptocurrency exchange FTX and the conviction of its founder on fraud charges. Cryptocurrency is a volatile asset with no intrinsic value. It is used almost exclusively to speculate or to engage in shady businesses, such as selling drugs or collecting ransom, for which the anonymous nature of crypto accounts comes in handy.
The former president, however, has changed his tune, promising to make the United States the “crypto capital of the planet.” And the Republican Party seems eager to follow. Sen. Cynthia Lummis (R-Wyo.) has proposed that the federal government purchase around 5 percent of the world’s bitcoin supply to build a strategic reserve such as the ones the United States has for oil and gold.
Mr. Trump’s pivot attests to a new power emerging in American politics: a class of technological entrepreneurs and venture capitalists uncomfortable with government regulations intended to protect American consumers.
Crypto backers are staking their considerable fortunes on Republicans in 2024. Fairshake, a pro-crypto super PAC, has raised more than $200 million. The Winklevoss twins — big crypto investors who launched the Gemini crypto exchange — have contributed millions of dollars. Venture capitalists Marc Andreessen and Ben Horowitz, perhaps the biggest investors in crypto firms, have offered support to pro-Trump PACs. Silicon Valley entrepreneur Peter Thiel helped launch the political career of Sen. JD Vance (Ohio), who is now Mr. Trump’s running mate.
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tanyev
(49,483 posts)https://boingboing.net/2024/08/02/intellectually-very-high-level-watch-trumps-hilarious-attempt-to-understand-bitcoin.html
Turbineguy
(40,166 posts)He's skilled that way.
jimfields33
(19,382 posts)I think that would help a lot. However, I don’t think it’d be good for everyday purchases for individuals. A nice combo would be nice. I’m sure there were haters at all historical changes to money types through our history.
DinahMoeHum
(23,652 posts). . .and crypto in general:
"Rat poison" - WB
"Trading in turds" - CM
FalloutShelter
(14,558 posts)
I think Munger’s thought on the subject might explain Trump’s attraction to it.
BoRaGard
(7,591 posts)since so many of the repubes piss all over American values
BootinUp
(51,551 posts)
sanatanadharma
(4,090 posts)Curious if the crypto-holders are very happy to sell for US dollars?
The GOP delusion of converting reality into illusion is consistent.
getagrip_already
(17,802 posts)Crypto has no intrinsic value. There is no underpinning of physical value.
It obtains value when some rube hands in currency in exchange for bits on a blockchain.
It is the con of the universe. You literally program money.
central scrutinizer
(12,655 posts)Flock together
keithbvadu2
(40,915 posts)Think of Steve Bannon not letting you sell your coins of his cryptocurrency while he can sell his.
Experts Raise Warnings about Steve Bannon's New Cryptocurrency
Source: Mother Jones
Investing cryptocurrency with Steve Bannon
Crypto investing based on hate before profit.
Profit for the big boys.
An 'investment' that the big boys may not allow you to sell while they can sell at will..
https://www.motherjones.com/politics/2022/01/steve-bannon-boris-epshteyn-fjb-crypto/?fbclid=IwAR0LIVF8XP6mC3wbAaD1Fu9b_Msxe6DBm572KFyuyDjvGwClJ4z2R0zfIzI
Fla Dem
(27,727 posts)
William Seger
(12,517 posts)... by convincing other people they'll get rich buying crypto. I'd call that a scam.
womanofthehills
(11,007 posts)Trying to understand it.
I can see how people get rich -
William Seger
(12,517 posts)
Buns_of_Fire
(19,201 posts)Yep, I owned over 1,000,000 Shiba Inu's. Market value: About 20 bucks.
I bought them for fun, to see what it felt like to own a million of something. I didn't feel much different, so I decided the $20 would be better spent on a couple of six-packs of Guinness. 
MineralMan
(151,476 posts)BComplex
(9,944 posts)We cannot let them get any headway with this horrible idea. This is another way to lose our country, and our position in the world.
HariSeldon
(541 posts)But the folks behind the current infrastructure and who are now supporting TCF are total scammers.
But a blockchain tech denominated in USD and run via "proof of authority" instead of climate-destroying "proof of work" -- perhaps run by the US Treasury or the Federal Reserve -- and adding a block every 5 seconds is something I could get behind. It would provide a direct solution to card account theft, easy interpersonal payments (bye, bye Zelle and Venmo), and tamp down fraudulent wire transfers.
mdbl
(8,721 posts)Don the con loves his illegal money hiding places.
GreenWave
(12,725 posts)
walkingman
(11,076 posts)but have no problem with allowing the crypto industry, even pursue their presence.
We live in a strange world these days.
moondust
(21,326 posts)Bitcoin still has to be reported.
https://www.fec.gov/help-candidates-and-committees/filing-reports/bitcoin-contributions/
dobleremolque
(1,128 posts)
snot
(11,848 posts)(css https://apnews.com/general-news-db008818acaf4d09a17f2c2aced42836 ) but ran into regulatory difficulties; and bills have been proposed in AZ, WY, GA, and possibly others that I'm not aware of.
Pluvious
(5,431 posts)
LessAspin
(1,983 posts)Saw a great line to the effect .. Trump knows as much about Crypto as he does about Christianity 
Here's another good line 
Link to tweet
Link to tweet
https://www.democraticunderground.com/111698449#post7
Mountainguy
(2,145 posts)That Trump wants to force retirees to convert their SS to crypto.
MrWowWow
(1,461 posts)launder "money?"
keithbvadu2
(40,915 posts)The big money return in crypto is:::
1. Starting it, hyping it, selling it, and getting out, leaving the
suckers holding the bag.
2. Handling/storing it for others.
...a. Not your own money/crypto. Someone else's money/crypto.
...b. Lots of fraud/money manipulation/theft/lack of regulation.
3. Backed by trust/faith/great promises/optimism... but no
real assets.
4. It can literally disappear and good luck with lawsuits.
------------------
A few have profited by 'investing' but not the majority.
Warpy
(114,650 posts)which allows them to move money around undetected. It's just another lunatic libertarian techno bro idea that some truly horrible people have immediately started to use. Libertarians have such a pathological hatred of governance that they've opened massive money pipelines for everybody from Putin and his ilk to the scumbuckets who film the rape of children to sell to men who like that shit.
Libertarians have got to be the biggest, most naive fools on the planet.
So of course Republicans love crypto, the boys at the top always have, it's one way they managed to fund the Jan 6 riot, bringing every violent loonie to DC via airlines and chartered buses. That's where they all got the money for their "revolution." Idiots.
Arne
(3,609 posts)Me, this wallet is empty...
Yes, of course it is.
snot
(11,848 posts)Last edited Sat Aug 3, 2024, 04:59 PM - Edit history (5)
"Cryptocurrency is a volatile asset with no intrinsic value." The dollar also has no intrinsic value (since Nixon took it off the gold standard in order to finance the Viet Nam War); ditto many other currencies, including any potential Central Bank Digital Currency (CBDC) and many other kinds of assets. As for volatility, there is no way crypto will ever cause the kind of carnage wrought by credit derivatives in the 2008 Global Financial Crisis, yet we now have more credit derivates than ever (and imho, we'd benefit much more if such derivatives were much more severely restricted than we would from restricting crypto).
"[Crypto] is used almost exclusively to speculate or to engage in shady businesses, such as selling drugs or collecting ransom, for which the anonymous nature of crypto accounts comes in handy." This is misleading or flat-out wrong in several ways.
First, note that the article provides zero support for this claim. Second, it makes no sense at all to generalize about crypto, because there are hundreds of kinds, each with different characteristics. Imho the only ones worth talking about, in terms of both their qualities and their share of the crypto markets, are BTC and ETH.
The vast majority of BTC are used not for crime but as a store of value, since the currency is non-inflatable. This is quickly verified since it's known that most of it is held by owners that have simply sat on it, often for years, watching its value rise and fall but mostly rise; in fact, this lack of circulation is decried by some as an impediment to BTC's development as a currency.
I know less about ETH, but my understanding is that it's principally used in facilitating and enforcing contractual arrangements.
The quoted statement is also misleading in that if you want to do criminal transactions, sure, you can use crypto, but you can also use dollars – and dollars are in fact used for crime much more frequently.
Moreover, just about anything can be used in connection with crime – currencies, phones, computers, cars, buildings, clothing, food, etc. – but we don't outlaw those things, and even reducing access to them would first of all require a gigantic, tyrannical police state and secondly fail to get at any of the root causes for crime.
Finally, re- Warren Buffet's take on BTC, see "If You Invested $1,000 In Bitcoin When Warren Buffett Called It 'Rat Poison Squared,' Here's How Much You'd Have Now....$3,462.82...based on a price of $34,490.19 for Bitcoin at the time of writing. This represents a return of 246.3%...." (https://www.nasdaq.com/articles/if-you-invested-$1000-in-bitcoin-when-warren-buffett-called-it-rat-poison-squared-heres ). Buffett's investment firms have also made a lot of money investing in crypto.
In sum, this is a complex subject, of which the article imho shows very little understanding.
andym
(6,068 posts)The rebuttal you provided is flawed.
Saying Bitcoin is non-inflatable is misleading-- all that means is that the number of bitcoins to be minted is set at a finite number. So that means that supply is artificially limited. However, the minting of Bitcoins by mining which typically means getting a reward for validating transactions becomes successively more difficult, creating speculators' dream of near infinitely increasing value-- the crypto press is full of predictions of worth greater than some arbitrary outrageous amounts (Billy Bambraugh at Forbes has articles predicting Bitcoin at 20 trillion dollars sometime in the future). But it's really equivalent to synthesizing money out of thin air. Bitcoin is particularly ill-suited for financial transactions because if the artificial supply limit causes its value to greatly inflate relative to the dollar, then it's foolish to actually use it in financial transactions, as one is losing potential money every time it is used to buy something.
On the other hand, Bitcoin is open-source and easily cloned. There could be millions of Bitcoin clone blockchains exactly equivalent to Bitcoin, they could even be created in include all the previous transactions of Bitcoin, and while such efforts are likely to fail, why should they not be exactly equivalent? After all they are backed by the same backing as Bitcoin-- nothing or rather the belief by some folks that there is value there. So Bitcoin is kind of like a fiat currency like the dollar. However Bitcoin and any of its clones are not
backed by anyone but "investors" whom just as might as well be called speculators. OTOH, the dollar is backed by
1) The value of the U.S. dollar is based on the trust in the U.S. government and its economy. The U.S. has a large and diverse economy, a strong legal system, and a history of stable governance. This trust gives the dollar value, even if it’s not backed by a physical commodity.
2) The dollar’s value is influenced by economic fundamentals like GDP growth, interest rates, inflation, and trade balances. These factors are far from arbitrary and are rooted in the real economy.
3) The U.S. dollar is the world’s primary reserve currency. It’s used in international trade, and many countries hold large reserves of dollars. This global demand for the dollar provides it with significant value and stability, independent of any physical backing.
4) Monetary Policy: Central banks, like the Federal Reserve, use monetary policy tools to manage the supply of money and control inflation. These policies are designed to maintain the value of the currency over time, and are based on economic principles rather than arbitrary decisions.
5) The dollar’s value is determined in part by its exchange rate with other currencies. Exchange rates fluctuate based on economic conditions, trade balances, and investor sentiment, which are not arbitrary but reflect real economic activity and conditions. Meanwhile Bitcoin's value and non stable coin crypto is determined entirely by potentially fickle investor "trust" and greed.
The biggest difference between the dollar and Bitcoin will come during financial crises:
The dollar’s crises are often mitigated by central bank intervention and regulatory oversight, while Bitcoin’s decentralized and less regulated nature leaves it more vulnerable to market-driven crises with limited external support mechanisms.
snot
(11,848 posts)Among other points, cursory research should show that there is no realisitic possibility of effectively "cloning" Bitcoin.
Also, I'm having trouble even comprehending what you're trying to say about BTC's lack of inflatability. To me it simply means that no centralized or other authority can create a bunch more BTC out of thin air as the Fed has with dollars, with the result that if you'd spent a dollar on BTC ten years ago, you could now buy a lot more hamburger with it than you could if you'd simply kept your one dollar. And yes, BTC has been volatile, but overall it's outperformed most other investments.
andym
(6,068 posts)Last edited Sun Sep 8, 2024, 11:43 PM - Edit history (1)
So your cursory research is indeed cursory. Focus on the idea of "forks."
Such copies (typically with a new protocol layer, though all that would be needed is to create a protocol layer adding new data to a frozen copy of the BTC blockchain at the time of the fork) are the result of "hard forks." Since everything is open source this is not even difficult. Of course there can be a big problem in selling the new blockchain/token as being "worthy" of being mined or invested in.
A few examples that actually succeeded somewhat are Bitcoin Cash, Bitcoin Gold and Bitcoin SV.
Here is one starting point:
https://www.fidelity.com/learning-center/trading-investing/hard-fork
BTC's volatility is its largest negative, because it is baked into the system. Yes, it has increased in value-- and likely will continue to do so (but when it gets bigger (probably around 10x), it's volatility will represent quite the threat to the world economy)
snot
(11,848 posts)and as the article you link to points out, the vast majority of forks quickly wither and die. Forks really can't succeed without the consensus of a substantial community of users, and since it's generally against their interests in the value of their investment to create more BTC, such a consensusis rarely achieved and maintained. As you mention, "there can be a big problem in selling the new blockchain/token as being 'worthy' of being mined or invested in."
In any case, the possibility of inflation via BTC forks is trivial compared to the ongoing inflation/destruction of currency value via dollar-printing.
andym
(6,068 posts)plus optional extra changes, with the minimum change to point to a new blockchain which was a snapshot of the original one. Most try to be improvements by actually changing the protocol-- but they don't have to. I or any competent coder could create Bitcoin 1A, Bitcoin 2A, Bitcoin 3B tomorrow, preserve the protocol and the old chain, but make one change point it to a cloned/copied new chain with new keys. I thought I explained the technical aspects in my last post. Original Bitcoin would have no technical advantage, only mind share, which is not trivial I grant you. What I am stating is that there is nothing special technically about Bitcoin, and if enough folks were convinced something about the new chain were better (Some economic superpower stating they would make it their currency for example) then it could replace Bitcoin as the dominant cryptocurrency --granted that is not likely.
As for dollar printing., sometimes the Fed actually reduces the money supply-- these actions are supposedly dictated by economic models, but I have to grant it is possible for them to err. That doesn't compare with Bitcoin's volatility and greed-based price inflation.
snot
(11,848 posts)on vocabulary and on how we evaluate the importance of various risks.
For one thing, the word "inflation": when I and I think most people speak of inflation w.r.t. a currency, we're referring to the situation in which a unit of the currency falls in value relative to that of most goods and services, so that it takes more of the currency to buy less goods or services. Most of us regard this kind of inflation as bad.
The "price inflation" of BTC that you speak of is something that I think most people would regard as the opposite of bad, because it's the situation in which the currency increases in value relative to that of goods and services, so the currency buys more, not less. I thus find your use of price "inflation" confusing, since it seems to suggest that BTC's increasing price relative to goods and services is somehow bad.
I also find your warning about "clones" to be confusing, since the whole point of a forked currency that it's at least somewhat different from the original; so it's not as if there's any risk of someone copying your BTC and spending it before you do. The result of a fork is simply the creation of another, separate currency, which may or may not compete effectively with the one you're holding, presenting a kind of risk no different from the kind that the dollar might face in competition against, say, Swiss francs.
As for the Fed reducing the money supply, it's been a very long time since they did much of that.
andym
(6,068 posts)I didn't mean to say that a clone of bitcoin would necessarily devalue bitcoin. Just that because it can be cloned, there is nothing special technically about Bitcoin versus its clones. Why "invest" in Bitcoin versus "Bitcoin-3?" The answer is because it is the original with the mindshare and "miners". The interesting thing about a true clone is that if it did ever become worth anything, holders of bitcoin might automatically also own tokens in the new clone blockchain and actually increase their investment by "diversification." That would depend on whether the programmers allowed that kind of thing to happen.
As for tightening the money supply recently: it's surprising but the Fed tightened the money supply from June 2022 to October 2023 (M2).
https://fred.stlouisfed.org/series/M2SL#:~:text=Download,2024%2012:02%20PM%20CDT
A articles if you are interested from 2022-2023:
https://www.goldmansachs.com/insights/articles/why-the-us-money-supply-is-shrinking
https://www.richmondfed.org/publications/research/econ_focus/2022/q3_federal_reserve