China Cryptocurrency Ban

hi folks,
I think we should rein in on the OOT and also specific comments about the blog. While her blogging is in the public domain, and hence is open to scrutiny, but it feels kinda strange to be critical in the times when bitcoin and co are down, but kept silent when they were on their way up. In an alternate universe, they could be the the quacking ducks.

VB.com is value investing forum. Exploring more about blockchain technology or distributed ledger systems would be a better way to move forward. Example, what forumer Wildreamz has initiated and some of the follow-ups by others, have benefited myself (and probably many others).

Moderator

To avoid any misunderstanding, I would like clarify my position.

1) My post is not directed at any particular person, and is meant to be understood in general terms. It is not my intent to cause ill feelings. I apologise if you were hurt by what I have written.

2) With regards to criticisms, I think anyone who voluntarily place themselves, or their works, on a public platform must be willing to face unpleasant opinions occasionally. Having independent thought and opinion is important for an investor, and the sharing of these personal thoughts and opinions is important for a public platform forum like VB to prosper; lest the forum withers, or forms group think. That said, I acknowledge that being objective and sensitive in our approach will certainly create a more pleasant experience for all.

3) I am indifferent towards cryptocurrencies. What they are, and whether their value will appreciate or depreciate, is of no interest to me. I treat them as a distraction in my work to find value investments. If there are people who can profit from it, I'm happy for them. If they lose money from it, I don't derive pleasure from their misfortune. Good luck to whoever is trading cryptocurrencies.

Canadian Official Wants Google to Ban Ads for Crypto, ICOs
https://www.coindesk.com/canadian-offici...ypto-icos/

Cryptocurrency is somewhat like the dot.com days.
In its present form, most of it is pretty much useless and probably will be near worthless in the long run.
However those that are able to gain market acceptance(right now very very few merchants accept it as payment), and transform itself so that it is trusted as a currency and is easy for everyone to transact will see its value go up. Amazon and google did not go bust and ended up being the dominant player. They become intertwined in our daily lives, how useful the services they provide will ultimately decide how valuable the company/currency is. Right at this very moment cryptocurrency is best described as the gambling chips in a casino. It's sole use is for gambling.

I do not think that any Cryptocurrency itself, per se, would become immensely valuable in the long run. Unless it also serves as a right to ownership of an actual value producing asset (maybe some ICOs qualify as that).

99.9% of all cryptocurrency right now, overwhelmingly benefits early adopters. Which encourages speculation, fraud, and unfair redistribution of wealth from later adopters to early adopters. This result in a vicious cycle that will most likely bring upon it's own downfall.

it seems the governments/incumbents of the monetary system are also timing their strikes, with bans and statements (many negative) surfacing recently one after another, slamming on bitcoin while it's falling. it's a challenging period for both camps. as a spectator, it's truly exciting. digital currency is the future (in many ways it's already here), and in that regard, cryptocurrency will likely be huge. i dont have the slightest clue who the winners will be and cannot position myself.

(08-02-2018, 05:11 PM)BRT Wrote: it seems the governments/incumbents of the monetary system are also timing their strikes, with bans and statements (many negative) surfacing recently one after another, slamming on bitcoin while it's falling. it's a challenging period for both camps. as a spectator, it's truly exciting. digital currency is the future (in many ways it's already here), and in that regard, cryptocurrency will likely be huge. i dont have the slightest clue who the winners will be and cannot position myself.

From my observation, very likely a government (or consortium of governments/financial institution) backed (fiat?) crypto, with regulatory oversight. And countries like China, India and Russia will take the lead, instead of America (Trump government) or Europe (too busy fighting among themselves).

Putin, Modi and Xi have both political acumen and tech vision to pull it off.

(08-02-2018, 05:24 PM)Wildreamz Wrote:

(08-02-2018, 05:11 PM)BRT Wrote: it seems the governments/incumbents of the monetary system are also timing their strikes, with bans and statements (many negative) surfacing recently one after another, slamming on bitcoin while it's falling. it's a challenging period for both camps. as a spectator, it's truly exciting. digital currency is the future (in many ways it's already here), and in that regard, cryptocurrency will likely be huge. i dont have the slightest clue who the winners will be and cannot position myself.

From my observation, very likely a government (or consortium of governments/financial institution) backed (fiat?) crypto, with regulatory oversight. And countries like China, India and Russia will take the lead, instead of America (Trump government) or Europe (too busy fighting among themselves).

Putin, Modi and Xi have both political acumen and tech vision to pull it off.

China as we all know has had enough of cryptomania and has banned it and is implementing measures to block access to it by regulating VPNs.

India is only allowing it so they can tax it. They are not recognizing it as a legal tender, which means it will just be like a digital commodity in india. However should the government have problems taxing it, Modi will not hesitate to ban it. India's sudden switch to replace high-denominaiton currency notes in 2016 was a good indication of his no-nonsense attitude towards financial reform.
https://cointelegraph.com/news/india-med...crypto-tax

Putin was initially against crypto, but their stance now is reportedly towards regulating it, with legislation to regulate the mining and trading of cryptocurrencies still awaiting consideration by the Russian Parliament. 

There is speculation that Russia is now considering issuing a legal tender cryptoruble. Russia will retain control and jurisdiction of this digital form of their Ruble. But that is just a draft bill proposal by one of the ministers. 

For laughs, you can actually get your hands on a cryptocurrency PutinCoin (which is not endorsed by Russia)

With the recent crash of crypto, it has been demonstrated how volatile crypto can be. I am sure the attitude of governments before this event will have changed more towards the negative side.

In the end there really is not much reason for govs. to use cryptocurrency, everyone has their own national currency which already has their digital form in online bank accounts and bank transfers, all nicely stored in centralised databases.

(09-02-2018, 08:05 AM)BlueKelah Wrote: China as we all know has had enough of cryptomania and has banned it and is implementing measures to block access to it by regulating VPNs.

India is only allowing it so they can tax it. They are not recognizing it as a legal tender, which means it will just be like a digital commodity in india. However should the government have problems taxing it, Modi will not hesitate to ban it. India's sudden switch to replace high-denominaiton currency notes in 2016 was a good indication of his no-nonsense attitude towards financial reform.
https://cointelegraph.com/news/india-med...crypto-tax

Putin was initially against crypto, but their stance now is reportedly towards regulating it, with legislation to regulate the mining and trading of cryptocurrencies still awaiting consideration by the Russian Parliament. 

There is speculation that Russia is now considering issuing a legal tender cryptoruble. Russia will retain control and jurisdiction of this digital form of their Ruble. But that is just a draft bill proposal by one of the ministers. 

For laughs, you can actually get your hands on a cryptocurrency PutinCoin (which is not endorsed by Russia)

With the recent crash of crypto, it has been demonstrated how volatile crypto can be. I am sure the attitude of governments before this event will have changed more towards the negative side.

In the end there really is not much reason for govs. to use cryptocurrency, everyone has their own national currency which already has their digital form in online bank accounts and bank transfers, all nicely stored in centralised databases.

You brought up a great point. Government backed Fiat Cryptocurrency vs the Existing Fiat System (cash + checking deposits etc. aka M1 money supply). Probably will include a series in the Blockchain thread.

Anyway, the terms "centralized", "decentralized" and "distributed" should be differentiated in this discussion, ie:


Historically, we never had a truly centralized system, more like a somewhat disjointed "Decentralized" system with many moving parts. Money is spread among many different banking systems, online and offline among different exchanges. 

As FITS principle (Fraud, Intermediaries, Through Put, Stable Data) goes, the monetary system is perfect for a blockchain overhaul.

And government is further motivated to introduce a Fiat Cryptocurrency because, now ALL M1 supply in the system can be truly be tracked and accounted for, making money laundering virtually impossible.

Will further expound on the point when I have time.

On CryptoRuble, it is actually not accurate to call it a 'speculation'; there has already been multiple official announcement by the Russian Government:
Putin considers ‘cryptorouble’ as Moscow seeks to evade sanctions
Max Seddon in Moscow and Martin Arnold in London JANUARY 2, 2018

Quote:Moscow officials say President Vladimir Putin has commissioned work on establishing a cryptocurrency, as state-run Russian institutions rush to embrace blockchain, the shared ledger technology on which bitcoin and other digital currencies are based. 

 
On India:
Will Modi government kill Bitcoin for Lakshmi, its own cryptocurrency?
https://economictimes.indiatimes.com/new...833957.cms
ET Online|Updated: Feb 08, 2018, 06.43 PM IST

Quote:The Reserve Bank of India (RBI) is already looking at the brave new world of crypto currency. The success of Bitcoin may have encouraged the central bank to consider its own crypto currency since it is not comfortable with this non-fiat crypto currency.

A group of experts at RBI is examining the possibility of a fiat crypto currency which would become an alternative to the Indian rupee for digital transactions.


Last year, it was reported the government could launch its on cryptocurrency, Lakshmi.


RBI's crypto currency could be a part of creating its own Blockchain, a distributed digital ledger and technology that supports crypto currencies. State Bank of India has taken the lead in bringing lenders and tech companies together for using Blockchain technology to share information among banks which will eventually help prevent frauds and tackle bad loans which are almost one-fifth of banks' loan book. The SBI's initiative, christened Bankchain, is in partnership with IBM, Microsoft, Skylark, KPMG and 10 commercial banks.

On China:
China’s central bank is developing its own digital currency, even as it bans bitcoin and private cryptos

Quote:China’s central bank is conducting research to issue the country’s own sovereign digital currency, a move in parallel with similar efforts ongoing in Russia, even as the government has doubled down on banning the use and exchange of bitcoin and other cryptocurrencies.

Digital legal tender can help bring down transaction costs, extend financial services to rural areas and increase the efficiency of monetary policies, according to Yao Qian, who leads the research at the People’s Bank of China (PBOC), the country’s central bank.

“The development of digital economy needs central bank-issued electronic currency more than ever,” Yao said during a Saturday forum in Beijing. “It’s crucial to speed up the research and issuance.”

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Based on current trends, I would say that we would likely see the first sovereign, state-issued, fiat, cryptocurrency as early as 2019.