Perfect example of why governments must hold Bitcoin

andriarto

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Quote from: Vishnu.Reang on September 15, 2019, 03:33:01 AM

Quote from: bitbunnny on September 14, 2019, 07:03:44 AM

Quote from: Vishnu.Reang on September 14, 2019, 06:06:14 AM

What Maduro needs is hard cash (in the form of United States Dollars or Euro). If he had Bitcoin or any other cryptocurrency instead of gold, I am not sure whether his fortunes would have brightened any further. The sanctions prohibit other countries from purchasing any assets from Zimbabwe and that includes gold and digital assets including Bitcoin.

I'm not sure that Bitcoin could help to Maduro or anyone else. They still need to stick to fiat money and gold. In general, Bitcoin is still too risky because of high volatility and governments can't rely on them. Could you imagine economic or financial system that would depend on Bitcoin? I don't think so.

Maduro should work on a national unity government after reducing the rampant corruption. Bitcoin is not a magic wand that can remove all the troubles in Venezuela overnight. As long as the sanctions and embargoes remain, there is hardly any chance of improvement in the economic situation. And there is not much that Bitcoin can do in this scenario.

bitcoin is used divenezuela because their currency has hyper inflation, so it becomes worthless, then the government chose bitcoin as their currency. I think it is right that Maduro should improve the government system first, before moving on to economic improvement, if the country has a lot of bitoin, maybe with an increase in the price of bitcoin later it can make a lot of money, making it easier to improve the economy

Vishnu.Reang

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Quote from: bitbunnny on September 14, 2019, 07:03:44 AM

Quote from: Vishnu.Reang on September 14, 2019, 06:06:14 AM

What Maduro needs is hard cash (in the form of United States Dollars or Euro). If he had Bitcoin or any other cryptocurrency instead of gold, I am not sure whether his fortunes would have brightened any further. The sanctions prohibit other countries from purchasing any assets from Zimbabwe and that includes gold and digital assets including Bitcoin.

I'm not sure that Bitcoin could help to Maduro or anyone else. They still need to stick to fiat money and gold. In general, Bitcoin is still too risky because of high volatility and governments can't rely on them. Could you imagine economic or financial system that would depend on Bitcoin? I don't think so.

Maduro should work on a national unity government after reducing the rampant corruption. Bitcoin is not a magic wand that can remove all the troubles in Venezuela overnight. As long as the sanctions and embargoes remain, there is hardly any chance of improvement in the economic situation. And there is not much that Bitcoin can do in this scenario.

rose9696

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I don't deny Bitcoin's profitability over the years, but I'm sure the risk is high when investing in bitcoins.
A country whose government fully believes in bitcoin is actually quite dangerous, if one day, bitcoin is manipulated and the price returns a few hundred dollars, then that country will go into crisis?
Basically, bitcoin is not technologically dominant and it only has a chance of deflation, halving every 4 years.
But Litecoin also has Bitcoin Cash as well, so what is the guarantee for bitcoin to grow forever?

Janation

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Quote from: jostorres on September 14, 2019, 09:36:26 AM

Government are not even supposed to attack cryptocurrency because it is like this even favored them more in the area that the op listed on the benefits of it for the government.

I don't think they will be putting an attack to cryptocurrencies.

Some might hate the idea of it but I don't think that all of them are the same.

I think what they would just do is take care of the citizen that are using cryptocurrencies. They can't control the crypto but they can add that under their law not only to support it but also to protect the citizens that are using it/

NavI_027

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Quote from: bitbunnny on September 14, 2019, 07:03:44 AM

Quote from: Vishnu.Reang on September 14, 2019, 06:06:14 AM

[snip]

I'm not sure that Bitcoin could help to Maduro or anyone else. They still need to stick to fiat money and gold. In general, Bitcoin is still too risky because of high volatility and governments can't rely on them. Could you imagine economic or financial system that would depend on Bitcoin? I don't think so.

Why not? Bitcoin got its own advantage which fiat or even gold can't offer. Bitcoin is the future, try to embrace it mate

. And for yout question my answer is Yes, I can imagine a cashless society. I know it's hard to believe but still possible for me especially knowing the fact that Venezuela's fiat is now losing its value and their countrynen are now looking forward into btc. Several countries are now also starting to adopt crypto which only means they really think that it could be a good tool to improve their economy.

FlightyPouch

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Quote from: Findingnemo on September 14, 2019, 09:49:04 AM

Quote from: jostorres on September 14, 2019, 09:36:26 AM

Government are not even supposed to attack cryptocurrency because it is like this even favored them more in the area that the op listed on the benefits of it for the government.

But they will when once they started to lose their fiat value due to the increase in adoption of bitcoin and other decentralized matter,so bitcoin holders need to stay at that time to bring the real financial freedom.

"Attack"? What does that mean? You don't need to think that since they will never attack nor control crypto currency since even they have bitcoin saved, the majority of it is in the investors. Also, it is not easy to control a big crypto currency like bitcoin.

TheCoinGrabber

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Well not entirely rely on it but if a part of the treasury was used to buy bitcoins when it was pretty cheap, the value would be great by now. I don't know how they would use that to boost that economy though. Maybe they can have people outside converting it to whatever fiat is needed to buy goods and smuggle them back to Venezuela? That's the only way I can see that they can use it to get around whatever sanctions they have.

Findingnemo

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Bitcoin = Financial freedom

Quote from: jostorres on September 14, 2019, 09:36:26 AM

Government are not even supposed to attack cryptocurrency because it is like this even favored them more in the area that the op listed on the benefits of it for the government.

But they will when once they started to lose their fiat value due to the increase in adoption of bitcoin and other decentralized matter,so bitcoin holders need to stay at that time to bring the real financial freedom.

jostorres

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Quote from: Findingnemo on September 13, 2019, 02:20:01 PM

Quote from: omonuyak on February 08, 2019, 05:13:05 AM

That is the fact and the decentralized nature of cryptocurrencies or bitcoin makes one transactions synonymous. Outside governments I think even individuals should endeavour to hold bitcoin than gold in other to make things easier.

Its risky to hold decentralized thing like bitcoin as long as it didn't considered as legal tender in your country.I don't think any country considering bitcoin as currency in this world but many regulated it as digital assets so holding needs to pay taxes.

The anonymity is good for the users but really bad thing for the governments.

This is why government is trying to play wisdom with it, they don’t want to ban it because using it as an asset will also add additional benefit to the government but using it as currency will sure affect them and have you winder while they are all trying to create their own coins? Because, they know that is the only way that they can weaken the strength of bitcoin to be recognized and used as currency when they impose their own coin on their citizen which is not part of the freedom that is being signed by some of these governments when they assumed power.

Government are not even supposed to attack cryptocurrency because it is like this even favored them more in the area that the op listed on the benefits of it for the government.

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Quote from: Vishnu.Reang on September 14, 2019, 06:06:14 AM

What Maduro needs is hard cash (in the form of United States Dollars or Euro). If he had Bitcoin or any other cryptocurrency instead of gold, I am not sure whether his fortunes would have brightened any further. The sanctions prohibit other countries from purchasing any assets from Zimbabwe and that includes gold and digital assets including Bitcoin.

I'm not sure that Bitcoin could help to Maduro or anyone else. They still need to stick to fiat money and gold. In general, Bitcoin is still too risky because of high volatility and governments can't rely on them. Could you imagine economic or financial system that would depend on Bitcoin? I don't think so.

Vishnu.Reang

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What Maduro needs is hard cash (in the form of United States Dollars or Euro). If he had Bitcoin or any other cryptocurrency instead of gold, I am not sure whether his fortunes would have brightened any further. The sanctions prohibit other countries from purchasing any assets from Zimbabwe and that includes gold and digital assets including Bitcoin.

fiulpro

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*There would actually be a problem if they were holding bitcoins and the price decreased suddenly then their economy would go so down and there would be problems and problems .

Yes it could actually be good but unfortunately it could also doom them .

They are just trying to play safe .. which could get them through these days .

You cannot blame them for choosing gold

Findingnemo

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Bitcoin = Financial freedom

Quote from: omonuyak on February 08, 2019, 05:13:05 AM

That is the fact and the decentralized nature of cryptocurrencies or bitcoin makes one transactions synonymous. Outside governments I think even individuals should endeavour to hold bitcoin than gold in other to make things easier.

Its risky to hold decentralized thing like bitcoin as long as it didn't considered as legal tender in your country.I don't think any country considering bitcoin as currency in this world but many regulated it as digital assets so holding needs to pay taxes.

The anonymity is good for the users but really bad thing for the governments.

deisik

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Quote from: cellard on February 07, 2019, 10:56:35 PM

Quote from: deisik on February 07, 2019, 11:18:40 AM

What you say may be true, but this backup you are talking about is not possible without a way to enforce it (i.e. make it actually work as a backup in case such a need should arise), so while trusting an entire overseas jurisdiction with your gold is definitely not the way to go, trusting a few people with your bitcoins doesn't really look like a much better alternative at all unless you can make these people return your bitcoins in some way. The latter basically means you will have some power in the future, but this may not be the case with Maduro in particular and dictators in general

What would you do? If you were running some sort of dictatorship, independent republic, or any other organization which tries to be as neutral as possible, but no matter how neutral you plan to be, there's always going to be allies and enemies due game theory

I'm not running a dictatorship, so I basically don't know

However, I wouldn't trust anyone in particular. In this way, if I wanted to remain in power (and have a working backup plan), I would definitely follow a policy known since ancient times as "divide and conquer" with the emphasis on the first part (i.e. the divide part). This element is about breaking up larger chunks of power into smaller pieces so that no one individually would have sufficient power or desire to question my rule (let alone actually trying to end it)

So if we consider financial aspect of my imaginary dictatorship (for that rainy day when it might come to an end), it still comes down to trusting no one specifically. And this leads us to the conclusion that we should built a distributed system of trust where failure (read, betrayal) of any particular element or part of it could not threaten the financial stability of the whole (read, my financial well-being no matter what the circumstances might be). Do I count as a good dictator?

omonuyak

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That is the fact and the decentralized nature of cryptocurrencies or bitcoin makes one transactions synonymous. Outside governments I think even individuals should endeavour to hold bitcoin than gold in other to make things easier.

ufaiz50

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Quote from: cellard on January 27, 2019, 11:59:10 PM

If Maduro was holding Bitcoin instead of gold, specially gold outside of your borders, he wouldn't have had that little problem. Of course Maduro is probably too computer illiterate to get the thing done.

You could make the argument of "if he was holding his gold inside his country he wouldn't have been denied access". Well still, it would make sense to hold Bitcoin and not gold, specially when you have an empire like US always threatening anyone with entering your country and taking all of your gold and oil reserves as they will do with Venezuela. With Bitcoin they couldn't be able to take them as you could have safe backups overseas.

This is an unbeatable logical argument for the bullish case of institutions holding Bitcoin. Im not saying they should dump all of their gold, but definitely dump a certain % and diversify with Bitcoin. This will happen sooner or later, and it just takes a first mover for the rest to follow, they will not be able to afford not having some due game theory, similar to not having powder back in the way when when wars were fought with swords.

There is a positive side that can be taken here, indeed by using bitcoin you can secure you and make transactions easily. Regarding taking oil and gold reserves, I don't agree with the regulation and bitcoin can be a safe solution because your assets are anonym, this is why the government is a little scared because if assets are truly anonymized by using fake identities or not requiring an identity when making transactions. Diversification is really needed in the world of economics not only to reduce risk, but there are still many benefits from diversification assets. In essence, in my opinion diversification is necessary, it's up to you to throw away your assets so that when you have one problem with one of your assets, your other assets can help you, I don't want to talk about shortages in gold or cryptography, but in economic problems.

cellard

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Quote from: deisik on February 07, 2019, 11:18:40 AM

Quote from: cellard on February 07, 2019, 12:08:34 AM

Quote from: deisik on February 02, 2019, 07:11:52 AM

Indeed, you cannot trust gold for the reasons stated, but I don't think you can trust Bitcoin a lot more than that, either. To be 100% betrayal-proof, you should do everything by yourself. I don't think this is the case with Maduro as otherwise he wouldn't be in a situation like the one he is currently in). So he has to trust someone, and that is where there is not much difference between gold and Bitcoin as the flip side of trust is betrayal, as per definition. When money is involved and big money at that, you can't trust anyone, even your closest relatives like spouses, children, etc

That's why it is so lonely at the top (see Bezos case)

I understand what you mean, but any big infrastructure, like a government, is going to need some delegated tasks, and some backups. If you are the president, or the boss of a big deal with many people involved, you need allies.

The difference between hosting gold reserves overseas in a different jurisdiction vs appointing some high trusted, very select set of people to host Bitcoin backups, I think lowers risk of betrayal by several orders of magnitude.

As I said before, Maduro would have reduced risk to a few people vs trusting an entire overseas jurisdiction, bank and whatnot. There's no such thing as perfect security, it's all about getting the best that you can get.

You are underestimating people's greed

What you say may be true, but this backup you are talking about is not possible without a way to enforce it (i.e. make it actually work as a backup in case such a need should arise), so while trusting an entire overseas jurisdiction with your gold is definitely not the way to go, trusting a few people with your bitcoins doesn't really look like a much better alternative at all unless you can make these people return your bitcoins in some way. The latter basically means you will have some power in the future, but this may not be the case with Maduro in particular and dictators in general

What would you do? If you were running some sort of dictatorship, independent republic, or any other organization which tries to be as neutral as possible, but no matter how neutral you plan to be, there's always going to be allies and enemies due game theory.

Let's say on a long enough timeline an imperialist force like the US tries to invade your borders and you have no options but to fight, or give up, both outcomes end up in your assets stolen.

Of all possible options, what is better but to have Bitcoin as your reserve asset and have overseas backups? with a scheme of choice to try to end up with a successful outcome. You have many options like seeds, timelocks, or just good ol trust for someone to carry your wallet. What other asset gives you options?

Like I said, it's about having options, nothing is perfect. Bitcoin is the closest to perfect there is.

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Quote from: kolesozw on January 28, 2019, 01:23:15 AM

EU and UK are toothless loyal US dogs. They doesn't have own decision making process now. The point here isn't is Maduro good or bad, but the point is they are breaking all democratic principles.

Having Bitcoin will not help Maduro anyway. He will need to convert to fiat at some point. And all cryptos are what 120B? This is nothing compared to world finances and needs.

At this point in time you are right but if we begin to think about the future then it makes sense that something like bitcoin should be favoured as a way to store your money safely and to avoid the scenario we are seeing now, but before we get to that point it will be important that we do this at the personal level since this is no different than what banks do to people every day denying you access to your funds just because they do not feel like giving you your money.

kkaroul4

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because holding bitcoin will definitely make Bitcoin experience a rapid price increase, because if the government wants to hold the bitcoin it has a positive impact on the value of bitcoin

deisik

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Quote from: cellard on February 07, 2019, 12:08:34 AM

Quote from: deisik on February 02, 2019, 07:11:52 AM

Indeed, you cannot trust gold for the reasons stated, but I don't think you can trust Bitcoin a lot more than that, either. To be 100% betrayal-proof, you should do everything by yourself. I don't think this is the case with Maduro as otherwise he wouldn't be in a situation like the one he is currently in). So he has to trust someone, and that is where there is not much difference between gold and Bitcoin as the flip side of trust is betrayal, as per definition. When money is involved and big money at that, you can't trust anyone, even your closest relatives like spouses, children, etc

That's why it is so lonely at the top (see Bezos case)

I understand what you mean, but any big infrastructure, like a government, is going to need some delegated tasks, and some backups. If you are the president, or the boss of a big deal with many people involved, you need allies.

The difference between hosting gold reserves overseas in a different jurisdiction vs appointing some high trusted, very select set of people to host Bitcoin backups, I think lowers risk of betrayal by several orders of magnitude.

As I said before, Maduro would have reduced risk to a few people vs trusting an entire overseas jurisdiction, bank and whatnot. There's no such thing as perfect security, it's all about getting the best that you can get.

You are underestimating people's greed

What you say may be true, but this backup you are talking about is not possible without a way to enforce it (i.e. make it actually work as a backup in case such a need should arise), so while trusting an entire overseas jurisdiction with your gold is definitely not the way to go, trusting a few people with your bitcoins doesn't really look like a much better alternative at all unless you can make these people return your bitcoins in some way. The latter basically means you will have some power in the future, but this may not be the case with Maduro in particular and dictators in general

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