The pound sterling will remain the largest global currency. Nobody will
challenge the pound sterling in our analogue metaverse. But it will become
progressively harder for England to use the role of the pound sterling to force
the world to comply with its will. You can’t jail all the central bankers.
StukiMoi
2 years ago
“There are many ways governments can crush Bitcoin but a blanket prohibition of selling Bitcoin for cash coupled with merchant restrictions is the easiest to envision.
No one confiscators the bitcoins, and no one stops mining. You just have no way of buying anything with cryptos other than peer-to-peer barter.
No matter how many times I repeat this, Bitcoin bulls dismiss it as impossible. It’s not impossible.”
While perhaps not strictly impossible, it’s a lot LESS possible to block sales of Bitcoin for dollars, than it is to block sales of Gold for Dollars. Or of Cocaine for Dollars. Or of weapons-to-“terrorists” for Dollars.
As always, the real world is a continuum. And probabilistic. You can make things harder. But not impossible. In economics, harder is referred to as “more expensive.” “Impossible” would require infinitely expensive…… Ergo: governments can make transacting in, hence holding, crypto more expensive.
BUT, conversely, there are also costs associated with holding Dollars. Debasement being the most obvious and constant. But also the cost of hedging against the risk that your stuff arbitrarily gets stolen out of the blue. Just because some yahoo who is closer to a guy falling down airplane stairs wants some of it. And those costs are definitely higher now, that the Dollar is revealed to be even more of a vehicle for arbitrary confiscation than was previously thought to be the case.
IOW, since both dollars and cryptos have costs; what to hold and transact in, comes down to cost/benefit. Hence, unless the fiat pushers should somehow suddenly reverse the debasement and arbitrary “weaponization” of their favourite conduit-of-theft, crypto really has it quite easy: All Bitcoin has to do, is just stick around. Sooner or later, all Russians’ stuff will have already been arbitrarily stolen. So them, to keep the loot flowing, it will have to be on to someone elses stuff… Enough of that, and the costs of crypto no longer seems so bad anymore in comparison.
StukiMoi
2 years ago
“His crime, if you call it that, was instructing North Korea on how to use cryptocurrencies to avoid sanctions.”
IOW, his “crime” was being gullible enough to believe current day America is as committed to free speech as North Korea is. Just because it once used to be.
That’s what growing up indoctrinated-from-birth into total obedience to the ruling classes of a totalitarian country, did to him.
And Virgil Griffith is, comparatively, a very smart guy. Just imagine the effect this sort of all-encompassing indoctrination will have on the saps who are dense enough to believe fungus in their walls magically creates wealth for them as they sit there idly and cluelessly. Or that printing dead guys’ faces on paper pieces somehow, just as magically, creates trillions of new wealth to be handed out to lowbrows arbitrarily “deemed” and “held” to be “too big to fail”, despite them all obviously being “too dumb to not fail.”
Jojo
2 years ago
US Department of Justice, aided by cryptocurrency exchanges, seizes over US$3.6 billion in stolen Bitcoin
15 February 2022
On February 8, 2022, the United States Department of Justice (DOJ) announced a landmark seizure of 94,000 Bitcoin valued at over US$3.6 billion, the DOJ’s largest seizure of cryptocurrency ever and the largest single financial seizure in the department’s history. Two individuals were arrested and charged with conspiracy to commit money laundering and conspiracy to defraud the United States.
This landmark seizure is an early victory for the DOJ’s new initiative, the National Cryptocurrency Enforcement Team (NCET), first announced in October 2021. The seizure also highlights law enforcement’s growing ability to trace and recover digital assets used or obtained in connection with cybercrime, as well as the importance of the private sector’s role in helping to thwart unlawful activities involving cryptocurrencies.
The case began when a hacker infiltrated a virtual currency exchange
New law cracks down on shell companies to combat corruption
By JOSHUA GOODMAN
January 10, 2021
MIAMI (AP) — For years as a federal prosecutor in New York, Daniel R. Alonso led teams that had to search through a maze of anonymously owned corporate entities to expose criminal activity.
“It required all kinds of shoe-leather investigating to identify who was really behind these shell companies,” recalled Alonso. “You’d have to subpoena bank records and lawyers, as well as human sources, and even then you frequently hit a dead end.”
Now, thanks to a watershed overhaul of U.S. money laundering laws, locating the proceeds from foreign bribery, drug trafficking and financing for terrorists could be as easy as a few keystrokes.
The new legislation quietly passed by Congress last month after a decade-long fight is the most sweeping banking reform of its kind since passage of the Patriot Act, in the aftermath of the Sept. 11, 2001, terrorist attacks.
For the first time, shell companies will be required to provide the names of their owners or face stiff penalties and jail sentences. The information will be stored in a confidential database accessible to federal law enforcement and shared with banks who are often unwitting accomplices to international corruption.
“It’s not an overstatement that this law is a game changer in some serious ways,” said Alonso, who is now in private practice advising clients on foreign corruption and anti-money laundering issues.
Why is it necessary for a country whose currency is stored as reserves of another country to run a current account deficit? I doubt the brits had a trade deficit when the pound was king.
And the decision is made by other countries. Not the issuing country. So China doesn’t have final say.
Countries hold reserves primarily so they can still buy stuff in the event their currency collapses. It would make the most sense to hold reserves from countries from which you buy necessary goods. US GDP is about 75% services. China’s is about 50%. We don’t make a lot of stuff any more.
Agent_Smith
2 years ago
I think the scenario Luke Gromen outlines is somewhat likely: trade in whatever currencies countries want with imbalances settled in gold, and all currencies floating against gold. The US dollar never really loses its reserve currency status, it just gradually becomes less important. US treasuries, however, do lose their reserve asset status in a much more meaning way. Obviously there are all kinds of implications if things trend like this.
On a separate note, I am finally starting to get interested in cryptocurrencies as more than an interesting concept. If Ethereum successfully completes The Merge and becomes proof of stake, we actually have something potentially practical for high volume transactions. (Maybe Algorand is this way too, I’m just not familiar with it). I will probably take a lot of heat for bashing Bitcoin, but I just can’t see it as anything other than an environmental disaster with all the energy proof of work requires.
Algorand was built from the ground up to be low energy, fast settling, and has a transaction fee of a flat .01 cents. It’s also headed up by the guy that invented the zero knowledge proof that makes blockchains work.
Of all the blockchains I looked at, Algorand is by far the best engineere.
Bitcoin is jankey old tech now. Modern blockchains like Algorand have reduced the energy, time, and transaction costs to be as good or better than swift.
Want an account? Just make one. No gatekeepers involved. No government manipulation of value. Full transparency.
The user experience is still rough, and it’s the Wild West now, with scammers in all directions, but things will settle down. The tech is good for a lot of things besides currency… deeds, concert tickets, ip, anything that a ledger can keep track of.
One of the applications that has stood out is lofty. They buy houses and sell tokens for ownership shares. Each house gets an LLC that defines how revenue is distributed based on the tokens. If I didn’t think housing was about to crash, I’d participate.
You guys should give blockchain a second look Algorand in particular. I thought it was bs for several years, but it’s a really useful idea.
Eighthman
2 years ago
Another point about this topic: is the US rapidly losing its ability to monitor Russian/Chinese transactions because of encryption and SWIFT sanctions? Not that they need real proof of anything for sanctions to be applied but I wonder if they lose any grasp of what’s really happening.
Eighthman
2 years ago
13 % of Russian reserves are yuan. I think we must question the whole idea of having reserve currency especially the dollar. China/Russia are getting by with currency swaps across the globe. What remains is a sense of national savings, together with gathered interest, on reserves. I think that goes to gold and commodities or just diversifies into a currency basket. Israel just increased their yuan reserves and that raised eyebrows. Anyway, I think a patchwork of workarounds is much more likely than any of Glazyev’s ideas.
U.S., allies plan for long-term isolation of Russia
A new strategy would mark a return to containment after years of seeking cooperation and coexistence with Moscow
By Karen DeYoung and Michael Birnbaum
April 16, 2022 at 7:28 p.m. EDT
Nearly two months into Vladimir Putin’s brutal assault on Ukraine, the Biden administration and its European allies have begun planning for a far different world, in which they no longer try to coexist and cooperate with Russia, but actively seek to isolate and weaken it as a matter of long-term strategy.
At NATO and the European Union, and at the State Department, the Pentagon and allied ministries, blueprints are being drawn up to enshrine new policies across virtually every aspect of the West’s posture toward Moscow, from defense and finance to trade and international diplomacy.
Outrage is most immediately directed at Putin himself, who President Biden said last month “can’t remain in power.” While “we don’t say regime change,” said a senior E.U. diplomat, “it is difficult to imagine a stable scenario with Putin acting the way he is.”
But the nascent new strategy goes far beyond the Kremlin leader, as planners are continuing to revise seminal documents that are to be presented in the coming months. Biden’s first National Security Strategy, legally required last year but still uncompleted, is likely to be significantly altered from initial expectations it would concentrate almost exclusively on China and domestic renewal. The Pentagon’s new National Defense Strategy, sent last month in classified form to Congress, prioritizes what a brief Pentagon summary called “the Russia challenge in Europe,” as well as the China threat.
America “write documents” making up every more harebrained excuses for why it is OK for them; but not for anyone else; to steal the stuff others make, pump and dig up…..
Who the heck do people think the rest of the world will be first to dump and route around, once the institutional hangover of arrangements which made sense immediately post WW2 recedes ever further in the rear view mirror?
Dutoit
2 years ago
I think there we see the birth of an alternate market (and the end of a unified world market), where the dollar (and euro) will not be necessary any longer.
Of course all will depend in the future of the volume of this market.
Captain Ahab
2 years ago
Thinking critically, is it not HIGHLY likely that the US-made servers on global internet hubs already have installed software to detect viruses, and cryptocurrency transactions?
Regarding, “100% gold-backed currency, no country will accept the fiscal and trade
discipline conditions that commodity backing of currency requires”
Does gold need to be in currency form for transactions? It can be valued and traded by weight alone.
challenge the pound sterling in our analogue metaverse. But it will become
progressively harder for England to use the role of the pound sterling to force
the world to comply with its will. You can’t jail all the central bankers.
No one confiscators the bitcoins, and no one stops mining. You just have no way of buying anything with cryptos other than peer-to-peer barter.
No matter how many times I repeat this, Bitcoin bulls dismiss it as impossible. It’s not impossible.”
discipline conditions that commodity backing of currency requires”