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| coppice:
--- Quote from: EEVblog on March 16, 2023, 12:39:48 pm --- --- Quote from: tom66 on March 16, 2023, 10:49:47 am ---A decentralised system will still need some kind of financial regulation. What the current experiment with crypto has shown is it is not sustainable to expect the market to regulate itself. --- End quote --- In this case it's not regulation, it's an attempt at active supression. --- End quote --- While governments don't like crypto, can you really expect a government to bail out a bank that got in trouble through crypto, and hand it back to the volatile crypto world to rinse and repeat? |
| tom66:
--- Quote from: coppice on March 16, 2023, 01:32:38 pm --- --- Quote from: tom66 on March 16, 2023, 10:49:47 am ---A decentralised system will still need some kind of financial regulation. What the current experiment with crypto has shown is it is not sustainable to expect the market to regulate itself. --- End quote --- Nobody has ever come up with a decentralised financial system. They like to talk about crypto as decentralised, but every scheme proposed so far has a choke point where people can take control. --- End quote --- Well, there are crypto systems that are entirely decentralised. You can buy and sell Bitcoin without a central authority. That's the whole point of Bitcoin after all. The problem is how to make that function in the real world - you have payment dispute, fraud, theft, and the like. For those the only way to resolve the issue is to add an authority, or to accept that it is a cost of buying and selling. This might work for crypto-enthusiasts, but I imagine Joe Public will struggle with the idea. The secondary issue is many cryptotokens that function in a truly decentralised manner, like Bitcoin, have absurd power requirements to maintain the mining rate. It has to be very difficult to make new tokens, or the currency loses value quickly as hardware escalates in compute power. Alternatives based on proof-of-storage (e.g. Chiacoin) have a similar issue, with a significant amount of hard drive supply at one point being taken up by storage miners. Ethereum is now proof-of-stake which is a good thing from energy consumption but means the largest owners of tokens on the network can control the network creating the risk of a fork and destabilising the currency. |
| bdunham7:
--- Quote from: james_s on March 16, 2023, 07:08:26 am ---What if they were to limit the rate at which money could be withdrawn? I suppose that would cause all manner of other problems. The problem happens when too many people withdraw too much too rapidly. --- End quote --- If they try to change the terms retrospective of the deposit you can expect a full blown panic and a spot on the evening news. To reduce the 'runnability' of a deposit portfolio, the bank has to offer time deposits that are either less likely to be withdrawn (retail CDs) or are impossible to withdraw early (brokered deposits). Of course they have to pay more for that money. If you can get billions of deposits in non-interest bearing transactional accounts you can make more profit. Risk? Oh, we fired that guy and haven't replaced him. |
| coppice:
--- Quote from: tom66 on March 16, 2023, 01:53:13 pm ---Well, there are crypto systems that are entirely decentralised. You can buy and sell Bitcoin without a central authority. That's the whole point of Bitcoin after all. --- End quote --- As it says on the Wikipedia page, "A network of communicating nodes running bitcoin software maintains the blockchain.". Attack those, and you have control. Maintaining the blockchain, so its thorough but doesn't explode in size through a myriad of tiny transactions, is the Achilles heal of blockchain systems. They are not as distributed as they are portrayed. |
| bdunham7:
--- Quote from: tom66 on March 16, 2023, 01:53:13 pm ---Well, there are crypto systems that are entirely decentralised. You can buy and sell Bitcoin without a central authority. That's the whole point of Bitcoin after all. --- End quote --- They really aren't decentralized. The terms and code of Bitcoin have been changed several times by a committee. It is an oligolopoly at best, a wretched hive of scum and villainy at worst. North Korea, child pornographers, hit men and drug dealers along with SBF and the Winkelvoss twins. Bitcoin has merely gone from obscure low-level dirtbag usage to global crisis level criminal usage. |
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