Topic: Bitcoin's Dystopian Future - page 5. (Read 28243 times)

As for tor, an enourmous tool for freedom of speech is unfortunately used to transmit "illegal activity", the same as cash and/or bitcoin or any other medium of exchange is used for an "illegal activity".

The problem is "illegal things" have always existed, and people have always found a way to get what they are looking for, illegal or not. This is no different than cash, which is used every day for numerous illegal activities.

His prediction already did happen in real life and nothing came out of it.  Oligarchs in Eastern Europe, where the Soviet Rouble was immensely devalued or the new currencies devalued, had no problems in hiring armies of bodyguards (armed with bullet-proof vests and assault rifles) to protect them (and all sorts of crime and trafficking did flourish).

Mind you a lot of people were reduced to eating dog food in the early 1990s in the eastern bloc, I don't know how it gets anymore dystopian than that.

Sounded great, until I got to "The Bleak Future of Law Enforcement". You sound like all of these problems are all of the sudden going to appear or get worse because of bitcoin (or whatever distributed currency comes about).

85 people on this planet have more wealth than 3.5 billion people.

Not that Bitcoin's distribution is any better but I suspect it has better distribution than the real world distribution of $Fiat and other assets.

Like many technologies, Bitcoin can and will be used for good and bad. When fire was "discovered" it was used to cook and to burn down villages. Etc etc. As with any major change in society there will be winners and loosers, lots of people lost their jobs in the industrial revolution, but today I don't hear many people saying they regret it happened. As I see banks and governments crumble and fall or adapt to a new, more liberal society i will have a big smile on my face. This is not Dystopia for me, far from it!  But then again, maybe I'm part of that libertarian fringe -movement...

(unless they opt to take our crypto-toy forcefully). Yes they supposedly can't, but they could try anyway -and knowing the subjects they will. So I would advise to stay mum about your crypto-riches even with your inner circle and have the passport ready to get out of Dodge in no time instead of flashing Lambos when the time will come. Better yet would be to anticipate them moving first to a safer place.

Well thought and well-written, OP. But you missed one important thing. All those governments and people you claim will be our enemies in the future? They won't be. Governments will capitulate sooner or later.

Because by the time we're all millionaires, every single one of those people -governments included - will have melted down their fiat for crypto. Nearly everyone will be on board.

Yup. This is why the economy grows long term (yes in real terms, so after correcting for inflation).

Only in a wealth transfer. But wealth is not a zero-sum game. One can create wealth by applying work to natural resources.

I think the OP's wife has long since been fucking the pool boy... 

Exactly. Whatever the risks are of decentralization, the current situation has wealth backed by war and torture. Absolute mortal force. It may not seem that bad if you are not paying attention, but, it is that bad. When I first got involved in cryptos, and Bitcoin, I thought the Anarchists were all crazy, now, I realize they have some really good points.

Additionally, the problems with the centralization of wealth will also likely be far better with people able to distribute money and wealth themselves. Rather than the current situation we have now with hellfire missiles and prison states, making sure people, nations, groups, and even ideas, don't get out of line.

The wild notion that I do totally agree with the OP on, is that crypto currencies, Bitcoin, Alts, whatever, are the future of money. Those underestimating it are making a grave error. This will change everything, forever, I am certain. So if possible, the smoothest transition should be encouraged. I certainly would hate to see how bad it could get it power starts to lose control and what they would do to keep it. Anyway, hold on to your Bitcoins, and maybe some of those new anonymous Alts may end up pretty darn valuable over time too.

Well, your grandma may not be at fault here, but on the other hand their generation (or rather the government of their generation) has 'borrowed' money from our generation by putting up a scheme of massive debt, the same debt we now have to pay off, while a lot of us don't have jobs, and the ones who do have jobs are massively underpaid.

So we are pretty much just 'stealing' back what they 'borrowed' from us in the first place. No offense to your grandma, it's not her fault, solely at least.


Well, yes many will see it like this, and it is somewhat true. Every time someone gains wealth, another persons loses it. But by now pretty much everyone in the world has had the chance to hear about bitcoin, and it's their own responsibility to inform themselves of the scam they are living in.

Bitcoin will hurt a lot of people and it will hurt a lot, probably it will hurt more than it will help, (in the short term at least, things will even out in the long run, if we make it that far). But it's a necessity because the fiat scam will only make things worse in the long run. It's already almost impossible to life normally even in a first world country, let alone in third world countries. And this will only get worse the more the debt increases. Debt to whom? Debt to the 0.1% who have the sole 'right' to print money. Either directly or through loans.

Some people make me sick, but this might happen indeed and there's little i can think of we can do to prevent it.

I'm sure you're referring to the biblical prophecy in revelations. I'm not so sure the prophecy will be fulfilled this literally, especially because revelations in particular is a very symbolic book. But on the other hand, I wouldn't be too surprised if it happens. I would most likely resist such marks even if that means I will not be able to buy anything at all (even though at that point I'd be richer than most people on the earth). I'll just know that it's a sure sign that the prophecy is nearing fulfillment and the whole world as we know it will end soon by divine intervention. And the world will finally be cured from it's maddening sickness and corruption. It will be very tough, but it will only be tough for a short while.


I agree that it is likely that in case of a major wealth transfer, possible a transfer the world has never seen in the entire history of mankind, things will not go smoothly.

We'll be rich alright, but the world will most likely be in great chaos and many of them will hate us even more than they hate the bankers now. We may even have to fear for our lives.

Great thread.. and only part way through it atm...

But: Is there any reason to suppose that governments won't start accepting BTC?  In fact it would be a reasonable forecast that some smaller country somewhere will start piling in and that will probably precipitate the first in several dramatic rises relative to fiat currencies.

Once accepted, they would simply attempt to tax the windfalls that people have.

The NSA and other outfits can already get direct copies of what is happening on your computer screen in real time, I believe.  If not yet, it soon will be that way, or made to become that way.

All just speculation, of course.

That would lead to a lot of capital (savings Bank) to be inactive, and lets face it not everyone has investor soul/skills.
This is what a savings bank actually does: hedges the risk among many wannabe/ignorant/fearfull investors
I don't think an economy can afford not to have a saving bank for the above reason.

While it maybe true that enterprises that are led by own money. and by their founders are outperforming enterprises with boards and borrowed money,
but it takes unique circumstances to coexist for that to happen: capital, skillset, opportunity etc, its a gamble, but not something which economy can rely on to happen often, so enter investment banks that can at least take capital out of the equation. There will be always projects too big, or too risky for savings bank, and we would rather not have goverment do their job
So Investment banks is not something you can't cross out easily

I think the problem starts when savings bank are not isolated by investment banks, either by loans, or as a shared capital pool.
-did I mention Paul Penfield has in MIT opencourseware, a course in Information and Entropy series which he discuses this from Information Theory POV-

intresting i didnt know (only a week toying with BTC) we will need to see how those transactions play out, any experience/lessons out of it?
Yes that may well be, as "Verticalization" taking place, but that way lies cartelization, and well food is not something you want to see cartelizied... EU for example has a standing policy of hostility against agricartural co-ops for that reason, EU wants Farmers to work at cost.
True, infrastructure exists, but in this thought-game we have to assume they dont, you cant use products of inflation in your argument And what about future Industries?
In general though after bubbles rise and burst, and debts written off and a general mess, Infrastructure always grows and remains devalued yet, but a seed for future
I don't think it will be a very competitive ecosystem with a multitude of providers, I think large vertical players will dominate, who will either try to sabotage/starve each other or cut the pie. I don't see healthy competition there...
Crazies will always be there driving the world forward I guess, I just fear for their leverage
Corporation organization/ownership is stuck in the middle ages, I believe there is much room there for improvement and democratization within.
3d printing will definetly help the Selfproducer paradigm but that can seriously disrupt capitalism also making our conversation irrelevant...
In a world where anyone can JIT create anything, too much sci-fi here propably, and people work for "hobby", yes a deflatory economy could work but i think by then even the notion money will be long forgoten
Sure clauses are an option they are used even now, but it adds too much communication, negotiations, predictions in short red tape, But we are assuming here that all parties will try their best, but a single accident down the chain can propagate aggregating costs along the chain (more like tree actually) and bring all parties to a halt, and the resulting blame game will not help much.
Habits are the ones you should fear most, it may take 2 generations to either begin stabilizing if at all. You will not have much tollerance either, at the first sign of bad news people will want the good old model that worked back, yesterday.
this is how the unwind should be done inflation->GPD up -> lower Debt/GPD -> austerity -> deflation -> public investment -> inflation
with funds from austerity not diverted to debt repayment but to public investment aiming at restructuring and imbalances, easier said than done maybe
In Iceland they are Gods, If I ever decide to skip Greece, thats the only place I would go, if only for the climate. but it was easier to repudiate their debt because it was privately owned, so they simply killed their bad banks and voila!, while in greece it is not easy to kill the state .
The gamble here is that you hope that will never happen, as it really is the debt/gpd ratio that matters, as long as you have the denominator rising you can have it under control, (not that i am overenthousiastic about that notion). Still you will be left with the infrastructure in case you default - For example in 1893 Greece defaulted but was left with a railroad system and a ship canal- And inflation will let you change your trade balance.
Well Venezuela could well be a latin america Saudi Arabia, why has that not happen? seems that Oil is more than a curse than a blessing.
Why I am thinking of Hausdorf metric now? Anyway why impose an artificial wall (bitcoin) and not let "true" assets determine where the economy goes, at least this way people will try looking for workarounds. Land is expensive -> Go up, Oil is short -> go green/nuclear, Food is low ->
Still the IT industry is in a bad short sighted shape imho, all innovation lately is about another picture sharing service...
most ideas are at least a decade old. I still wait for my holodeck, my robotic AI maid, my flying car...
studends should only have one job: studying, anything else is a distraction.
Credit cards just help the poor survive waiting better days, hope is the greatest of all evils according to the myth of Pandora.
They wouldnt need the debt if they had an equal starting chance as others, bitcoin follows that meme too early/late adopters.
So purge sins through suffering? Agreed a strong ancient meme that works, but there must be a better way.
anarcho-capitalism ? Hagbard Celine nailed it "It's the privilege", as long as there are privileged players you can never have free-market.

Debates for me is the only way to test ones arguments, and move closer to the truth otherwise it's just autism, like many Hodling Parots here , thank you for indulging me
Lol sure after the crisis everyone in Greece focused on "WTF just happened" and all started to talk about economy, I wouldn be surprised if something similar with Japans  post-hiroshima tech-obsession happens here ok maybe wishfull thinking now.

Cut wages by half = you earn half as much, things cost twice your wage to buy.
2x inflation = you earn half as much, things cost same as your wage

Crap, you're right, Internal Devaluation sucks way worse



The original purpose of a bank was to provide security. I just meant that we will have "banks" go back to doing their original function, which is to provide security.


Since bitcoin is already deflationary, there is no need for a savings account that pays a little interest. Investment Banks will be the only reason to actually invest for an interest return. So, people themselves will be the private stashes, looking to invest money directly, or will have a large stash that they will give their investment bank authority to invest for them. We'll go from many people with small amounts of money funding "savings" accounts, to few people with large amounts. I haven't bothered to consider the implications yet.


I would hope that would be the case. Only people who know what they are doing, and have a personal vested interest in what's going on, should be investing. Imagine what the 2008 derivative market would have been if everyone actually questioned their bank about what it was doing with their money. Chances are such a market would have never materialized, or would at least have been properly insured.



BTCJam has been doing it for over a year now. There were (and probably still are) tons of personal lending in this forum's lending section.



You're right, this may be a problem, but I think that it will actually push farming into more industrial rather than less. A large corporation will be able to track sales and demands, and handle risks, much better than small individual farmers. I guess things with long-term investment, like olives, will become way more expensive. At least for those newly planted. However, since we already have many things planted, and are transitioning from inflationary to deflationary economy, those olives, farms, and other produce is already there, and already producing every year. A new olive tree added to sustain the orchard will just be a cost of continuing to do business. (entrenched old money?)


That's one option. The other is to diversify the risk by having multiple contracts with multiple smaller producers. I think that will be a cheaper and better option than to stock more, especially in a deflationary economy. Makes me wonder if inflationary economy is what pushed for large stocking to begin with.



A loan assisted deflationary economy can exist, but a loan driven can not, you are right. I think we are living in the results of loan driven economies, with countries and everyone else all straining under enormous debt. I don't know if that's a better alternative than a smaller economy not entirely propped up by debt. You can still be driven by prospect, though. You just have to be sure that your prospects will provide a higher return than the deflation rate. So yes, there will be less people taking extreme risks on new ideas.


I, unfortunatey, have not studied Japan's recent economic situation as much as I should have, so can't comment. With regards to entropy and insourcing, maybe. Maybe we will have a lot of diversification, too, with much more reliance on production being kept to higher standards. Then there's the whole 3D printing thing on the horizon that may change business dynamics entirely...


Heh, good point. Another option is to add discounting to the future purchase at the rate of deflation (somewhat being done now already). I have a contract where you will provide me a ton of steel 30 days from now for $1,000. If you take 45 days, I will only pay you $900. Pretty much the opposite of I sent you $1,000 worth of steel, and you have 30 days to repay me, or will repay $1,100 if you pay in 45 days. Though I guess this will delay production considerably in a JIT system, and would mainly work with established production flow.

A lot of how our economy functions will have to change, though if the rate of deflation is only 1% to 3%, it may not have to be by much.


I see it as the steps by which a debt-based economy inevitably unwinds itself as it finds itself no longer able to borrow. Greece should be a warning to all the other countries who are rapidly getting to the point where they can't print and borrow any more to sustain themselves.


Or you wait until you get to the actual economic rate of your country, not one propped up by debt, and start from there. Iceland had similar issues, and somewhat cut their suffering short by repudiating their debt, and starting over with much more strict limits on government borrowing and austerity. It has worked fairly well for them, even if a lot of people lost out on the debt. Countries with close knit communities and families will be able to survive this much better than countries with "rugged individualism" (looking at you, USA).


That's somewhat what has actually been happeming. The FED is inflating like crazy, and the cities and counties that ended up with too much debt are getting fucked directly by having their governments replaced with state appointed unelected "emergency" leaders, who's job is typically to sell off everything the towns had and GTFO before the locals get too restless.


If Greece kept borrowing and paying out in austerity more than it received from taxes or generated economicaly, you would have a more sustainable growth right up to the point where your borrowing matched your interest payments, at which point no one would lend you any more, and you would either have to hyperinflate, or be in the same situation you are in now. You can't have economic growth without the actual underlying economy. If you are growing through inflation and debt, someone, somewhere, will have to pay for that everntually


They are quite socialist, which is quite different from what US policy claims to promote. Maybe US meddling caused them to rebel and pushed them further into socialism?


Yeah, that's kind of the point I was making. Growth in an economy, or more specifically investment growth, is limited by the highest interest return of the lowest risk asset. It doesn't really matter what it is. If bitcoin is not that asset, but, say, oil will give you the highest return for the lowest risk, then people would only invest in businesses that provide a higher return than oil does. Oil would end up being that deflectory wall that bounces the economy back. The problem with inflationary dollars is that they provide a very low wall, but at the expense of future debt. So the deflectory bounce back is basically being pushed further and further into the future, until it can't be sustained or paid for any more.
Honestly, I'm too distracted to juggle all the economic variables in my head right now, with regards to the effects of this on inflationary and deflationary economies, so I'll leave that up to you.


Not if the product has a chance of providing higher returns than the deflationary currency. Our tech sector operates under the threat of their investments becoming worthless due to competitors and obsolescence all the time.


The staff themselves, I hope. Not through loans, but by paying their way through education.


If credit cards are not available to them, they won't have much of a choice.


I believe part of what keeps the poor poor is debt. Credit cards, dependence on social programs, etc. Inflation also makes their wages constantly depreciate. Under deflation, they would get an automatic slow growth in income. Plus, if they want anything like a TV, they would have to save for it, too. China has a lot of poor people, almost no social programs, and a huge culture of savings, even among the very poor, because they know there won't be anyone to come save them if they get in trouble. This also leads to more closely knit communities with interdependence. I think that is better than what we have now, with everyone being very individualistic, with little empathy for others.


Which, again, is why I'm an anarcho-capitalist. Remove the power of the state to give handouts, and there won't be a reasin for firms to bribe officials.


Likewise

BTW, very impressed that you know so much at such a high level of understanding. It's refreshing to be so challanged and be forced to think so hard in a debate (especially on this forum )

To the contrary, I only found this forum 18 months after I started mining, my go to for Bitcoin Groupthink was Slashdot. 
All I am saying is, if Bitcoin doesn’t offer any benefits don’t use it that is my advice to all. If you see value in the system, start by backing Bitcoin with wealth you can afford to lose. 

My values are very different from many here, but ultimately my prosperity is derived from the prosperity of all, so I seek solutions to maximise prosperity, a universal p2p triple enter accounting system (the encrypted blockchain) is the most viable solution I have come to understand.

The Rothschilds yielded a power more influential that the armies of Neapolitan and the land he plundered , and those backing Bitcoin yield a power superior to that of the Rothschilds. I buy Bitcoin for the good of humanity.

money is Trust, there is no better resource in a human society

We will never solve the problems of money with money, even if it is a better money. Investigate a resource based economy.

I don't see how halving wages is functionaly the same thing as inflation
Ok here you run around in circles, ending up essentially in the same model as we have now?
Not that I disagree that the fusion of Savings Bank with Investment Banks is a root cause.
Paul Penfield on an MIT opencourse in is series about Entropy&Information discuses about it don't have a link right now.
But if people need security I am sure there will be services that provide just that. (Not a Bank)
People will only go to a Bank to collect Interest, no Interest no Savings Bank, but will Banks be able to provide that or will they have Negative interest rates as FED is planing to? No Fractional Reserve -> No loans -> No Interest
So in my mind Saving Bank is a Non Entity, and that will mean that a lot of people (and capital) will be out of investment options
in private stashes.
Now on Investment Banks, which will capture only a handfull of capital, it will be risky bussiness.
My guess is that there will be many high profile scandals that will discredit and scare people away from banks,
sepecially if it is so easy to just Hodl and gain value.

Is there any recorded case of anyone lending out bitcoins? even as we speak, with bitcoin being currently inflating?

Regarding the Time constrains, for example Olive trees take decades to grow and start produce, so JITing food is easier said than done.
Farmers have a hard time even now, there are many risks that cannot be factored in the upfront investment to ensure timely returns, Oil and weather screw farmers systematicaly and increasingly, water is about to kick in (as real cost) as well as seeds. One would thought that Farmers beeing closer to the self-production model,positive "trade balance" making them winners in a deflative economy, but that would mean reverting to non-industrial farming, which cannot feed us all.
Flushing the pipelines means lower clock rates,
 Production delays -> Cost,Risk -> Cost,Cost,
 Less efficiency -> Less machine utilization -> Less capital utilization -> Cost
To balance those costs you have to shrink.
It's counterintuitive but, No they don't shutdown, because ROI comes from uptimes and utilization, not product quality
So by introducing any kind of delay (say one provider failed to provide on time, without buffers) you push ROI away.

Having said that and going back to the stock problem, bussiness already keep the lowest stock possible (there are still costs to maintain a stock) Problem is that because of higher risk now, involved by a provider failing to provide on time, you need to stock *more* at higher cost.
Ok so a root argument lies on whether a loan driven deflationary economy can exist. I don't think the backward looking dynamics allow that to happen. In deflation you are not been driven by Prospect, rather than Need, so you are bound to rush into bad calls here.
It will be an environvent with too much entropy, the players will start rely on increasingly fewer providers (insourcing production).
It well may end like Japan, with large Vertical "Corpotations" actually more like Feuds, btw is japan's economy in truth deflative? is Japan's Model stable in isolation?
Well contracts mean shit in bussiness, if a provider cant provide no contract can make him, you'll just swallow the delay and be wiser next time. And come on we just created freaking cryptocurrencies only to go back to barter economy? not arguing that it cannot work I can argue that it will be the way economy will respond. but that will reduce bitcoin to catch22.
Just watching the news: unemployment this month 27,9%,
Nevermind it's a spiral... deflation -> lower GPD -> Higher Debt/GPD ratio -> More austerity -> deflation
It's seems that once you are in this hole you can't dig yourself up again, you need external help, you need a Marshal Plan...
If ECB printed greece out of trouble, it would had minimal effect on Euro inflation, but I guess it would set a dangerous precedence,
and protestant thinking would not accept it selfrighteous bastards they are , Fuck the citizens so they fuck their goverment
On the other hand if we were a State in US, I bet FED would had done just that, and fuck the goverment directly afterwards.
If we had our own currency I don't think we would be in this mess, we would had a more sustainable and consolidated growth.

Argentina and Venezuela were always under the shadow control of US, I tend to blame US policy (over the years) for that mess over there.
I strongly disagree on growth, all dynamics lead to shrinking, If the economy has an any intend to grow it will hit the deflec(a)tory wall and bounce back, just as a recessing economy if inflated will bounce up.
Healthy bussinesses have standing staff, producing products, before a customer even dreams he needs them.
in a deflation Bussinesses hire staff in time in order to produce what the customer asked them.

Also Staff is propably underqualified because who would invest in education?
I am being sarcastic, at the notion that the poor can ever get to survive much less save
The poor will/need to raise their standard of living first, save second. Inflation/Deflation doesnot touch them, They don't give a fuck about bank accounts. All the poor care about is Jobs.
you know corruption takes 2 to tango, how many US firms have paid off officials in 3rd worlds countries? how many corrupt officials had CIA installed?
there is local corruption, there is imported corruption, and there is exported corruption,
Latin america suffered hard from US imported corruption, at first due to Cold war, later for economic reasons.
Africa likewise by Europe.
You know USD is not backed up by gold, or guns as Krugman says, it is backed up by Oil.


EDIT: apologies of quoting mayhem