When China and Other Big Countries Launch Cryptocurrencies, It Will Kick Off a Global Revolution (theconversation.com) 166
There has been a massive rise in the number of bilateral agreements between central banks that allow two countries to swap currencies directly, a large number involving China. Meanwhile, a number of countries, including Germany and the Netherlands, have been repatriating their gold reserves from vaults in the US where they had long been stored. From a report: Yet by comparison, major sovereign digital currencies based on blockchain technology would be revolutionary. Blockchains are encrypted ledgers for storing information that are decentralized rather than being under any country's or company's control. When applied to international payments, this offers the prospect of much more transparent and cheaper transactions than SWIFT. It could cut the payments time lag from a couple of days to one second, and the cost from 0.01% to almost nothing. It will have the capacity to handle far higher volumes of payments, partly since they won't require bank accounts or even internet access.
Cryptocurrencies like Bitcoin and XRP have been a good experiment in using blockchains for international payments. Yet when countries issue equivalents of their own, these will have even more advantages. They will be backed by states, and completely decentralized cryptocurrencies like Bitcoin will not be able to compete with this. While technological change has been incredibly fast in the information era, the system of international payments has lagged behind. But once sovereign digital currencies start taking off, this will suddenly change. Just like smartphones quickly eliminated most old cell phones, no countries will be able to reject blockchain payments for long. So while, for example, the US Treasury Secretary Steve Mnuchin recently said that his country does not see itself launching a digital dollar in the next five years, there will be a moment when the political centre of gravity will shift and everyone will join the revolution. After the 5G network and the Internet of Things really mushroom in the next couple of years, it will be possible to replace the existing system even faster. This will be the beginning of a new international monetary era.
Cryptocurrencies like Bitcoin and XRP have been a good experiment in using blockchains for international payments. Yet when countries issue equivalents of their own, these will have even more advantages. They will be backed by states, and completely decentralized cryptocurrencies like Bitcoin will not be able to compete with this. While technological change has been incredibly fast in the information era, the system of international payments has lagged behind. But once sovereign digital currencies start taking off, this will suddenly change. Just like smartphones quickly eliminated most old cell phones, no countries will be able to reject blockchain payments for long. So while, for example, the US Treasury Secretary Steve Mnuchin recently said that his country does not see itself launching a digital dollar in the next five years, there will be a moment when the political centre of gravity will shift and everyone will join the revolution. After the 5G network and the Internet of Things really mushroom in the next couple of years, it will be possible to replace the existing system even faster. This will be the beginning of a new international monetary era.
51% (Score:4, Insightful)
Just saying...
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So why even have a blockchain and not just use a database.
Blockchains make every transaction 100% traceable, cash is much more difficult to track and therefore harder to enforce laws with. Similarly, a database can have historical records forged, unless it's a blockchain (which is actually a type of database.) That's the thing people miss when comparing "blockchain" vs "database" - they aren't two different things, it's like saying "why not use a database instead of a relational database" or "why not use a graph database instead of a database" etc - "blockchain"
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Re: 51% (Score:4, Insightful)
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Blockchain also offers transparency, without reducing security, if that's a goal. If you by design control the majority of the chain, there's still value in using a technology where every transaction is public and auditable by everyone who uses the system. For a system for processing large international transactions between banks, that sounds like a killer feature.
How fast transaction are to process is only relevant if you have a lot of transactions compared to the computing power available, which again m
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Without a third party, you will have the same system as 'git', as soon as two parties disagree, you will get two branches impossible to merge.
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Re: 51% (Score:5, Insightful)
Do you think government-backed crypto would truly be distributed?
Of course not. A blockchain is "distributed trust". You use it when there are many people you trust a little, but no one you trust a lot.
For a sovereign national currency, where there is already a central authority, using a blockchain makes no sense whatsoever.
TFA was written by someone who can spell the buzzwords and string them into sentences but doesn't know what they mean.
But fiat currency is valuable. By fiat. (Score:2)
Seems quite safe to predict that China will not adopt or even support any form of currency that weakens the power of their government. I would go farther and predict that the imperial dictators of China will actively attack any currencies that bother them and China has the economic clout to doom any form of money that they hate.
If China decides to push any specific cryptocurrency, then it will not be for the sake of increasing freedom or supporting democracy, but rather to increase the strength of their own
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If China decides to push any specific cryptocurrency
There is no 'if' [fortune.com]. China wants to launch a national digital currency in the next 18 months. The link I shared is linked in the above article. The author may be talking out of wazoo about how he/she thinks it will affect world trade, but he is not speculating whether that is China's intent.
Re: But fiat currency is valuable. By fiat. (Score:2)
I for one cant wait for the Chinese govt to track every brexit dollar, or whatever you call that.
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China wants to launch a national digital currency in the next 18 months.
Digital currencies don't require blockchains.
Nearly all financial transactions in China are already digital. If you want to buy a coffee and donut, you reach for your phone not your wallet.
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Again, yours [cordovaCon83's] seems to be par for today's Slashdot. You appear to be agreeing with me on the substance of the issues at hand, but you are stretching for a "less charitable" interpretation or narrow sense of "if" so that you can come off all negative and critical. Again my response is "Where's your beef?" That's just intended as a tongue-in-cheek ACK.
Actually my own beef is elsewhere. My real concern is with China's still-hidden decision regards Trump. Attempting the humorous paraphrase: "If
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A thing on its own without any input from humans has no value. At least not to humans.
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Seems typical of Slashdot these days. It sounds like you are agreeing with my point, but in a confrontational tone of voice. The best I can come up with as a humorous ACK is "Where's your beef?"
Of course it's also possible that I was unclear again. My implicit "premise" or perhaps "fear" was that some BitCoin gamblers are going to sound off about how this proves their case for the "intrinsic value" of their latest moneymaking schemes.
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Thank you! A distributed ledger could/will probably be used but the coin mining stupidity is completely unnecessary. You just don't let untrusted parties sign transactions. Think git and not bitcoin.
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For a sovereign national currency, where there is already a central authority, using a blockchain makes no sense whatsoever.
Sure it does, as soon as there's more than one country making transactions, or if the point of the system, is to make auditing transactions between banks easier.
You've identified one reason to use a blockchain. That doesn't mean it's the only reason to do so.
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Do you think government-backed crypto would truly be distributed? Come on. They're going to do what Facebook Libra wanted to do.
Government-backed crypto will be usable as a currency IFF it represents an extension of an existing fiat currency, one whose money supply is managed by a country's central bank. Such a currency would be as trusted as the associated fiat, and would be treated as simply a way of making secret transactions in that currency. Unlike Bitcoin, this kind of crypto could actually work as a currency, if the associated blockchain setup can handle large numbers of transactions without bogging down.
BUT - it will never b
Oh great (Score:2)
Not again.
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Blockchain, IoT and 5G! How can that not be a smashing success!?
If only they could add in some additional words, like Tru, Super, Plus++ and add social media features so heads of state can add emojis to their transactions, it would be strongly perfect!
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Name checks out. Obviously already working in marketing...we're doomed.
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Not again.
As long as there are suckers taken in by the scam, we will have to suffer through this mind-melting bullshit.
Walk me through this (Score:3, Funny)
1) decentralize currency with blockchain
2) recentralize currency with state controlled block chain
3) ?
4) profit?
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A digital wallet doesn't require a thief to physically be in my bedroom to take it off the night stand while I'm sleeping.
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Why hasn't Slashdot published my submission yet? (Score:5, Funny)
All I know about this (Score:2)
#1. Remove that goddam comma in the headline.
#2. People who establish markets to trade all these currencies are going to make a fortune and I wish it was me.
Utter nonsense (Score:2)
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Re: Utter nonsense (Score:2)
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and lots of downside like losing control of their currency.
Why would you think that? Do you think the Fed controls the money supply by controlling the amount of physical printed currency? Money is a bunch of ledger entries, and the size of that pool isn't tied to the size of the pool of the underlying physical currency, whether dollar bills, gold coins, cows, or BTC.
Re: Utter nonsense (Score:2)
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When you deposit 100 BTC with a bank, the bank will immediately loan out that 100 BTC. Normal BTC transaction from you to the bank. Normal BTC transaction from the bank to someone selling a house (well, their mortgage company or bank). But your 100 BTC in savings is just a ledger entry, and the bank doesn't have your 100 BTC lying around to give back to you. Exactly like today.
Thus the money supply has just increased despite no new BTC being created. And that guy selling the house is probably also buyi
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What would obviously happen is that the government would keep control of the ledger to ensure maximum tax revenues (since they can track every single transaction), while the wealthiest/connected people simply move to a surrogate form of currency (or even a foreign currency) to transfer/preserve wealth. The little people will not win with a government backed digital currency as the primary method of payment.
Re: Utter nonsense (Score:2)
Re: Utter nonsense (Score:2)
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Why do we keep getting stories pushing crypto faux-currency? Why would any government do this? They can already track large non cash transactions and large pure cash transactions are irrelevant because only coke lords do that. And how would a centralized government controlled crypto faux-currency be any different than the fiat currency stored in databases we already have? Block chain and especially crypto faux-currency are a solution in search of a problem they actually solve. Block chain has some limited real world purposes. One of them is -not- "currency" or a "storage mechanism of value". Crypto faux-currency solves nothing.
You can read about the e-krona project by the swedish riksbank (central bank) in english here: https://www.riksbank.se/en-gb/... [riksbank.se] (both project reports in the linked article are also in english). Just to name one aspect is the possibility for the government to guarantee the transfer of money without using the banking system.
Re: Utter nonsense (Score:4)
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Because the payment system must work in a crisis. If the payment system is owned, controlled and managed by private actors like banks, it can not be guaranteed to work under stressed conditions like war or perhaps a financial crisis like the 2008 one.
Re: Utter nonsense (Score:2)
Authoritarian wet dream (Score:4)
Authoritarian states like China would love to switch to digital currencies: they could track every single transaction. Ditto for states like India or Greece where the cash economy is booming and tax evasion is the norm. And you still need something to back the currencies-ask Venezuela how well the petro went.
Digital, government-backed currencies are not a good thing, for a variety of reasons.
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Digital government (or powerful organization) backed currencies are a wonderful idea. They allow rapid transmission of money anywhere, fast transaction processing, etc.
That's why the fing Knights Templar invented them in the twelfth century.
Re:Authoritarian wet dream (Score:4, Interesting)
Authoritarian states like China would love to switch to digital currencies: they could track every single transaction.
China is already 99% digital. I was there for several weeks last year. Number of times I used cash: 0.
Even the beggars on the street accept digital currency. They have a QR sticker on the corner of their sob-story sign. Just open your payments app, scan the QR code, type in how many RMB you want to donate, and click submit.
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Exactly, you don't need blockchain to track every transaction
Lots of MBA-isms (Score:2)
I take this article with a grain of salt. The whole lure of cryptocurrencies is that they're (more or less) tough to trace, just like cash, but can be used for remote payments. If a country like China is getting involved (or the US for that matter), you can be *certain* that those transactions will be traceable - this is going in the wrong direction from a user perspective.
But then again, the author then breathlessly indicates 5G and IOT as "revolutionary" and then you realize that another know-nothing MB
Decentralization matters (Score:5, Insightful)
Without decentralization, the properties are the same as a standard database. These properties can't be anything else as the properties we already have on a standard database managed by a central authority. People rely on fairy tales to expect a different outcome.
Bitcoin is alone in this world as the only decentralized system solving The Byzantine Generals Problem.
Re:Decentralization matters (Score:5, Insightful)
Bitcoin was decentralized for a time, but at the end of the day, it's subject to the same economies of scale and specialization that everything else is in the world.
Re: Decentralization matters (Score:2)
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https://medium.com/@jimmysong/... [medium.com]
Re: Decentralization matters (Score:2)
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A 51% attack against Bitcoin is already beyond countries capability. You can't lend the whole electrical power supply of a country like Switzerland, and at the same time, build all the mining hardware.
65% of Bitcoin's hash power is already in China [theblockcrypto.com]. 54% of it in a single province in China. This was done, as far as anyone can tell, without the backing of the Chinese government. A state-sponsored attack on Bitcoin is laughably easy considering how easily hash power was already consolidated just for profit.
Re: Decentralization matters (Score:2)
Re: So why haven't people already done it? (Score:2)
This is not going to work. (Score:2)
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Cheaper and Faster? (Score:2)
Blockchain without Bitcoin = Standard Database (Score:3)
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I am esp head-desky over the idea that blockchain will somehow be faster and cheaper than current payment systems. It is already glacially slow and expensive compared to existing systems at a tiny fraction of the volume
That's because you're looking at systems designed to be decentralized. But government-designed cryptocurrencies won't be like that.
Cryptocurrency ultimate tool for blame tracking (Score:2)
If you think about it, government cryptocurrencies are inevitable because of the benefits they offer to government.
When everyone has to give a DNA sample to get a wallet, it means government can easily track every dime spent without even having to convince a third party to let it see purchase records.
But beyond that, is the ultimate tool - the ability to compute with complete accuracy your eventual contribution to thought crime X. That is to say, you bought a hammer from a store for $10, then from there th
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better would be an embedded chip in your hand, or it could be done in your head and that would be able to work as a phone.
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companies are already working on it, easy to implement it with a system similar to apple watch..
Now with 100% more surveillance! (Score:2)
I get shouted down every time I say this, and I'll get shouted down for it now, but fuck the haters: 'cryptocurrency' has always been used primarily for bad things. First for criminals to hide their actitivies, and now big authoritarian dictatorial human-rights-ignoring governments like China will leverage it to tighen their grip on the millisecond-by-millisecond lives of the Chinese people.
Do you live in a first-world country that believes in human rights, civil rights,
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Revolution? (Score:2)
When China and Other Big Countries Launch Cryptocurrencies, It Will Kick Off a Global Revolution
And by "revolution" we mean "authoritarian nightmare".
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That is one of the most common outcomes of a revolution.
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That is one of the most common outcomes of a revolution.
True, true. I guess the real question is, is that also the desired outcome by those at the top organizing the revolution? I think that you can make a compelling argument for the affirmative case.
the rest of the world (Score:3)
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The rest of the world has two choices. First, trust each other and create a mutual currency. Two, shut up and use the U.S. dollar. They may not like Uncle Sam but they trust him more than each other.
Each other includes known-bad actors like China and Russia. Imagine if Russia had ability to print EUs. It would be like that.
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They could also switch to Euros but that didn't work out so well for Iraq...
peak buzzwords reached.... (Score:2)
The reality is "IF" and I do say "IF" globally banks go to a digital currency, the world may ditch the dollar as the global currency. Going off the dollar as global currency will result in an immediate and deep US depression which will domino into a major global depression.
Don't think this will happen anytime soon (Score:2)
Not going to happen soon: Governments really, really like fiat currencies. Why? Control over the currency allows the government to control the money supply, enabling ways of stimulating growth and controlling inflation. Blockchain based distributed currencies like bitcoin would necessarily mean that governments would give up that control. It's similar to a gold or silver standard. Some people might think that's a good thing, but I would argue that the world economy has been far more stable since g
will happen this way (Score:2)
Blockchain would be used, but would not be anonymous, government could see all transactions for taxation, investigations, demographic stats, etc.
The hype in this article's summary is naive and ignorant
China would copy my money without permission. (Score:2)
Whoo hoo! 2020 is the year! (Score:2)
2020 is the year of cryptocurrency on the desktop! The revolution is coming!
Any time now...
no revolution for you (Score:2)
Ignorant prattle: taxation, crime investigation, analytics... all these things and more the government will demand of any currency system. None of the imagined benefits will happen even if a blockchain system is used, and there are far better distributed database systems with integrity verification than blockchain based ones.
no revolution coming, no privacy.
What a load of crap (Score:2)
This is, of course, complete nonsense (Score:2)
If any player that matters does this, there will not be any advantages for ordinary people. There will be disadvantages, such as tracking money-flows becoming or generating spending profiles for people far easier. Anybody that believes differently is deluded. The only possible advantage some cryptographic currencies have is anonymity (not really good anonymity these days, but that can improve). No major financial player will ever allow that in as a feature in anything they support.
"Advantages" (Score:3)
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Lightning is the payment system of Bitcoin, and Lightning can scale.
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Gold is the right analogy, what matters is the scarcity (stock-to-flow ratio) first. The scarcity enables the Store of Value property (SoV), and everything else follows.The book: "The Bitcoin Standard: The Decentralized Alternative to Central Banking" is the right one to get the full picture.
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Bitcoin is now the hardest monetary asset available to the humankind, with new properties we never had before (censorship resistance, cross border...)
The genuine SoV property is the only reason Bitcoin went from $0 to $20000.
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One of many problems with this idea, the planet's ecosystems can't afford the large-scale use of today's blockchain technologies, they are horrendously inefficient.
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