Topic: Bitcoiners kill Bitcoin, and governments are happy, boycott the CEXs (Read 962 times)

Thank you! This is an interesting information. Of course, I heard about something like that before, but the way it's explained in the Last Week Tonight with John Oliver is amazing, and it's definitely worth watching. The "middlemen of surveillance capitalism". F***ing hilarious! And a bit scary, I must say.

what you find is a single datapoint of say "email address". is only worth $0.0001
but some businesses want email addressess of people "aged 30-50", "male". and "enjoy chocolate"

this creates a basket datapoint value that is worth $0.02 due to it being a subgroup of a subgroup of a sub group  specific to a datapoint

its much like if you had a burger, a sausage, some onions, some cheese. and 4 condiments.
first appears to be just 8 ingredients(points) yet can be combined into hundreds of different varients of points

there are other double data points
eg one data point of: "meat eater".. is not just "enjoys meat", but also "non vegan"
eg "lives in the UK" is not just "british resident" but also "pound(£) user", "HMRC tax payer", "uses british brands"

its very very easy to create 1000 or even 11,000 data points by just knowing 110 things about someone where you can create new datapoints by combining a couple separate points into one larger subgroup datapoint
Eg "non vegan, under 30, female"

---

governments dont buy the random crap about if your a vegan or do you buy coffee
the FATF pay for KYC info that is supplied to them from suspicious activity. as a payment for delegating exchanges to police its customers
the tax office also as a separate agency pays for information on people of working age trading over $1k-$10k.. and $10k-$100k sub groups

governments dont care that you bought coffee using a starbucks giftcard you bought with crypto

but rival coffee companies would be interested in starbucks gift card customers.

No different really to when you keep your coins on a centralized exchange, and that exchanges decides to censor your transactions or freeze your account entirely because you did or said something they didn't like, tried to send money to someone they didn't like, or even just live under a regime they don't like. See my thread here: https://bitcointalksearch.org/topic/recent-events-should-make-everyone-withdraw-all-their-coins-to-their-own-wallets-5387401

Have a read about data brokers. It is a multi-trillion dollar industry which most people don't even realize exists. Have a read of my thread here: https://bitcointalksearch.org/topic/why-beginners-should-pay-attention-to-their-privacy-5394338. A single data broker company known as Acxiom has 11,000 data points on 2.5 billion individuals. 11,000 data points! Can you even think up a thousand data points about yourself? Now try 11,000! Everything from age, gender, address, through to employment, education, politics, religion, through to far more insidious things like financial history, purchases, debt, health conditions. They know what you like to watch, when you like to watch it, what you like to watch it on, and who you like to watch it with. They know what house you live in, who lives there with you, their relationship to you, how many bedrooms it has, and how much you pay in rent or mortgage. They know what health conditions you have or when you might be trying for a baby before your doctor does based on your internet search history, social media use, and recording of your private conversations. And yes, they know what exchanges you are signed up to, what addresses you use to deposit and withdraw from those exchanges, and how much money you are moving through those exchanges and when.

These data broker companies sell data to literally anyone who is willing to pay them, and governments are more than happy to spend your tax money on this.

I didn't know about that, and now I don't know how to verify this information, but considering your reputation I believe you. I must say, it sucks then. And not because I think all governments are evil by nature(I'm not an anarchist), but because it's a fact that there are bad guys in any government, and they can try to use the info against you.

here is the thing though,

there are 3 aspects
"property"
"currency"
"assets & commodity"

when bitcoin was just a property 2009-2014 government had no jurisdictions over crypto.
businesses(CEX) were just swap shops, like selling/buying trading cards. no regulations required

users fear was
if businesses would honour users deposits as still users property once converted to business displayed balance.
if strangers, peers would honour payments transfers as legal contract for goods/services
which would even today require a court claim if there was legal dispute over ownership/contract/agreements where a business/individual refused to honour agreements
...
when countries began to see crypto as a currency, this opened the door to some regulators who mainly had jurisdiction over just the businesses that service a currency for a fee, requiring said businesses to police its customers, identify them and report any suspicious currency uses

when regulators fought over the category of currency, (either asset or commodity) different jurisdictions got involved where they could get more involved with the crypto itself
EG as a commodity regulator could put quota's on trade value/yield or put circuit breaks on a crypto that pumps/dumps passed a limit of volatility, aswell as restrict whom can trade/be an accredited holder.. an environmental regulators can put production limits and environmental bans on the ways production is done

..
alot of people should have fought off the "currency" recognition and now fought off the "commodity" recognition as both allowed regulation to overstep and leap into controlling aspects of crypto that have not helped users. but hindered them

but due to the dream of "mainstream" they let regulators categorise crypto
such as highlighted by LeGaulois

these regulations and categories have not been consumer protection regulators though. 99.99% of them then are the banker regulators wanting to hinder/stifle crypto in favour of banking practices(most ceo of regulators are ex bankers)

governments cant and dont control bitcoin.. politicians do not sit at computers watching everyones purchases. governments dont walk around asic farms seeing if they are using renewable energy or using the most efficient miners. governments are simply lobbied by the banking industry, to put in laws to let banker led regulators to have powers to hinder/stifle bitcoin by classifying crypto into a jurisdiction that allows regulators(ex bankers) to step in
also governments are lobbied by the ex bankers where governments delegate regulators to do all the work

its getting a bit late to just say boycott CEX, because now even defi-DEX have to be careful.

even the likes of sub networks like lightning, if you are a payment router you are facilitating a transfer of currency for a fee...
.. and banks are watching for users who do too many bank wires in trades on their personal bank accounts to treat them as a unlicensed business breaching their personal bank account policies

so its not "businesses" fault. its the declarations of "currency" "asset/commodity" that has lead to this over stepping of regulators that delegate businesses to police its customers

as for things that are businesses fault. they have always had property law even before crypto, by which possession is 9/10ths of the law. its upto the business/recipient to be honourable and agree to terms that give rights to people that handed them property, currency.. which is why #NotYourKeyNotYourCrypto is important to keep in mind

..
separate from that. no matter what bitcoin was defined as, handing any funds to a stranger you cant slap with a rotten fish is always a risk. whether a business or individual.
once they have your coins the only true method to get them back if they are dishonourable is via court.. if you can locate them to serve a court claim upon them

This stuff with crypto is funny, sometimes I'm tired with this industry, people are sheeps.

Showing you something to argue with a point I was talking about in the original post.

Look at Indonesia, this country intends to sell Bitcoin to its population, as part of a reform to regulate the cryptocurrency industry.
They will create their own CEX during 2023 and the citizens will be able to buy & sell BTC (and altcoins)
And of course, most Indonesians (include bitcointalk users) will use it because it will be easier and more convenient when it's about to sell and getting the money to the bank account

Bitcoin, a P2P payment method...using government agency. Great deal.


We decide the laws, we decide where you can buy, and we decide what you can do or not with it.
Irony: this country was one that decided to ban any payment using BTC, if I remember correctly

A decentralized currency, with centralized entities that decide


Another exemple to show that when it's not via government, it's via companies
It was a post from me in the French forum (I translate it)



sorry for the late reply.

It's the person who registered the account on the centralized exchange who have to report it
Failure to report, we (the citizens) pay the fine.

Maybe they were once, but I think they have run their course. There is nothing of real utility (i.e. on/off ramps, not staking for 70% APY or other such obvious scams which are of no real world utility) that a centralized exchange offers that is not offered by a decentralized exchange in a safer, more secure, and more private way. The problem with advising newbies to use centralized exchanges are spelled out by myself and LeGaulois above - once they realize the huge risk and lifelong implications from completing KYC on a centralized exchange, it is too late to reverse their decision and they will forever have their government and various third party agencies spying on their bitcoin activities.

And yeah, this doesn't just apply to centralized exchanges, but other centralized scams in this space, like the vast majority of altcoins.

What OP mentioned just wanted to emphasize bitcoin, and he is absolutely right, but when we talk about the crypto market, CEX really matters, IMO. CEX is a bank, and they are garbage for pure bitcoin investors, but for us who invest anywhere for profit, CEX is indispensable.

DEX, even if it is further developed, cannot replace CEX, if you are a trader, if you do not use CEX, there will be no second choice to make a profit.

I completely understand and agree with what the OP mentioned, but we can say we failed because 99% of the participants in this market are for profit and not using bitcoin as a means of payment as the original purpose.

Okay, yeah. I thought centralized exchanges only send their users data to the government when they request it, but now i know better, i guess that is why being a member in this forum is great, if you read often, you learn everyday.

@LeGaulois, with the way things work in your own country, i want to know, when you say "we have to declare..." in your post, do you mean the centralized exchange have to declare it to the government, or do you mean the person who registered the account on the centralized exchange have to report it and provide all these details, which of the two? And failure to report, who pays the fine?

---

Happy new year people.

Since you are bringing up a comparison between Bitcoin and Christianity, I will continue in order to contradict you.

No, not all Christians derived from the Bible. There are many of us who follow the rules in the strict sense of the word. I don't eat pork, don't drink alcohol, am against abortion, divorce, practice the Great Lent and so on. I have not been washed by the Vatican Council 2.
Why am I talking about this? Because the Vatican is centralized (like the CEX). A pope is not the words of Jesus, he is an entity in charge of "centralizing" and "giving directions". I only listen to Jesus and nobody else.

It's exactly the same with centralized platforms, and it doesn't matter what type (CEX, web wallet,) I don't want THEIR ideologies imposed. Which is often very different from Bitcoin's ideology anyway. And that's what deputies also do when  try to introduce laws that are totally against the ideology of cryptos. I only listen to Satoshi and nobody else
Otherwise, I have no use of cryptocurrencies and should leave it to going back to use fiat


Following @o_e_l_e_o's answer I will add that he is right and I will quote the situation in my country.

We have to declare every year the accounts on the CEXs (even closed account, yes closed account), and if we don't do it, we have to pay a fine of 750€ per account.
We have to provide them with details that are sometimes difficult to find, like the date of opening of your account. You have to be able to prove all deposits, transactions, trades and withdrawals.

If they were able to make a law with a 750€ fine, it's because they can know that. Otherwise they wouldn't have created a law knowing that they can't catch the villains.

Once you touch a CEX, you're busted. And the things will get worse in the future.

---

Happy new years guys.

I believe that is where the problem starts, new comers are being hijacked by these centralized services inculcating different versions of what satoshi envisioned.  They even have the courage to state that self-custody will incur more losses than keeping their cryptocurrency on exchanges promoting the anti-not your keys, not your coins idealism.

point taken, I may have lapses in research regarding the nature of these scams. Reading all these opened my eyes a little regarding just how far the rabbit hole goes when it comes to heinous acts of crime made by centralized exchanges. I do understand they became brooding grounds of scam and taking advantage of hapless people who are so trusting. My point is that, I think as much flak as they are receiving right now, centralized exchanges are still a great addition to the industry. In a sense that they became gateways for people who are still learning the ropes of the crypto exchange.

Celsius and Voyager were centralized exchanges and lending platforms, so they are included in the umbrella of CEXs. Terra was a centralized altcoin with their own centralized platform.

Every major hack, collapse, scam, bankruptcy, etc., in bitcoin's history had been of a centralized platform, service, exchange, altcoin, whatever. From Bitconnect to Luna, from Mt Gox to FTX, from ICOs to DeFi. It's always some centralized trash promising the world and delivering nothing.

I understand you and your statement, I myself hate loss of funds in all of its forms and manner as much as the next guy, but to link loss of funds exclusively to centralized exchanges just because one of them turned out to be a scam in one of the most substantial moments in crypto history is just absurd in my opinion. Loss of funds in Centralized exchanges are but a drop of water in an ocean of possible reasons and fields these acts of offense could thrive.

I agree, the issue with CEX especially FTX coming out to be a scam seriously hampered crypto's advance, but there are other facets to look at, recency bias is taking over the people's minds when there were more grave offenses committed in the crypto space that aren't CEX's Fault. Celsius, Voyager, Terra/Luna, for instance. Why are we not focusing on these ones, when they are just as damaging if not even more impactful than CEXs?

As soon as you complete KYC on an exchange, then that exchange is cross referencing the data you provide them with identity data held by your government, so immediately your government can know that you have opened an account with that exchange. Most jurisdictions will require the exchanges to keep complete records of everything you are doing and provide them to various agencies in order to comply with AML laws, and similarly if you trade above a certain amount then you will be automatically reported to various agencies for tax reasons. None of this requires any suspicion of wrongdoing first. And even if they don't provide data to your government directly, we know that centralized exchanges all share or sell data to blockchain analysis companies (or even run their own blockchain analysis subsidiaries), and that governments extensively purchase data and rent the services of such companies.

I mean, just go and read the privacy policy of an exchange like Coinbase, for example: https://www.coinbase.com/legal/privacy. It is so extensive and all encompassing, it essentially gives them carte blanche to do anything they like with your data.

I don't think there is any centralized service (even non-crypto related) that reports their users personal information to the government by default. But there is a reason they collect it, and part of it is that they would report it to the government if ever there is any need to, there is that possibility.

And many times the government never require it, but they get hacked and it gets stolen by bad actors, or there could be an inside job and someone sells the information out, or they could even file for bankruptcy and the court needs the information. In my humble opinion, i think the point is just that registering on centralized exchanges means your activities and personal info can be out in the public for one reason or the other.

I don't want to defend CEXs in any way, because so many respected by me people are against them, and I think they know better than me, and, also, I personally don't use them, but just to be clear. Centralized exchanges report all your activities only if an order has been issued by a court, or something like that. They are not doing it by default, right?

The original idea of Satoshi has been greatly defeated. I am not sad about it. Satoshi was a wise guy who solved a world big problem. But he isn't a spirit to know how the future will fare.
I don't expect that bitcoin remains as proposed by Satoshi year in year out.
Even in Christianity, the Christians have deviated from the original plans and instructions of Christ and yet there is Christianity.
Bitcoin and it's usage will keep metamorphosising

You can try atomicDEX: https://atomicdex.io/en/.
I doubt the liquidity is great though. Still, you can use it as a non-custodial and open-source wallet, as a bridge, and a DEX. The DEX works with Bitcoin, Ethereum, BNB, Komodo, Avalanche, Polygon, and a bunch of other networks. Too bad they don't support Tron and Tron-based tokens. It could be useful to have a bridge between USDT (TRC20), BTC, and ETH, for example. I don't know if there is such a solution right now besides CEXs.   

The crypto economy will survive, but people will find it hard to make investment, buying and trading practice. It had turned to be common to experience hacks and security breach, but the Exchanges taking responsibility need to be appreciated. Through exchanges common people who want to invest into cryptocurrencies can make use of it.

With big issues arising out of Exchanges at certain time interval makes a bad image among the people who are staying outside the market to make the entry into cryptocurrency. With time more Dex could be found on the market, but the usage will be limited against the CeX.