This is an old favorite (written 14 months ago) that I've bookmarked and that I review from time to time. I find the logic extremely tight and the threat model eminently (terrifyingly) reasonable.
One thing I don't think he fully addressed was the game theory among nations aspect. I don't see Iran, North Korea, or even the brics nations following along with the U.S. at the mere mention of sanctions. #13 glossed over this too glibly.
You do realise, many people purchase via DEXs right? I've never done a single CEX and/or KYC purchase and have been in the Bitcoin game for many years.
What you'd see, a clear division between who cared for their privacy from the get-go, who saw the issues with CEXs before they became apparent, and who heeded warnings from other like-minded bitcoiners, hold their sats. The rest would be reported due to linking their fiat identity.
I've been warning about this for years, linking one's fiat identity and believing in bitcoin as a unit of account do not go hand in hand.
I know that some certainly have, and those people will be feeling pretty smart. Although given that I suspect that the price will have cratered, there will be a limit to their self-satisfaction, at least in the medium-term.
Again, it'll largely depend on why they got into Bitcoin in the first place, and if their reasoning changed, whether they took the appropriate precautions or not.
Example, and this obviously generalist, if you see Bitcoin as a tool you'll use it as a tool.
If you see it as a specupative asset ripe for trading, you'll not worry about KYC and will likely be looking to fiat-out in the end, for better or worse.
Also brings up the interesting question of how many bitcoiners might be lying to themselves.
Bitcoin has done more for many countries in less than a decade than fiat has, mostly regardless of price - And I only say mostly because if price continued to be low, the utility of it wouldn't have propagated as fast.
It's successfully withstood nation-wide attacks. It's helped thousands lift themselves from extreme poverty and escape countries without losing life-savings kind of wealth. And has offered alternative routes around CBDCs. Price increases are THE bonus. They're part of the mechanics of Bitcoin no doubt, but a bonus nonetheless.
Unconfiscatabe wealth was its reasoning for being created.
Also brings up the interesting question of how many bitcoiners might be lying to themselves.
I'd love to know the answer to this, but I suspect it's unanswerable. A related question might be: who holds btc, and how much? My sense is that, at this point, most bitcoin is held by non-idealists, speculators of various stripes, the group you describe this way:
If you see it as a specupative asset ripe for trading, you'll not worry about KYC and will likely be looking to fiat-out in the end, for better or worse.
Most of the people I personally know are not waiting for the revolution, they're looking to make some money, or, at best, protect themselves vs losing money. If that's the general template, then perturbations from state-level actors will be impactful. If it's mostly Adam Back-types, then state opposition will mean something different.
Price increases are THE bonus. They're part of the mechanics of Bitcoin no doubt, but a bonus nonetheless.
I mostly agree -- btc could be unconfiscateable wealth and be hugely useful to many, so long as it was more or less stable in price -- that works at $100 just as well as at $100k, provided the people who wanted their wealth to be un-confiscatable didn't purchase it at $100k and then watch it fall two orders of magnitude. The two camps are conjoined twins for that reason.
To be honest, I do think it's a bridge too far. They might try but it will be obviously enough ridiculous.
One part of the game theory regarding this is that they can't put us all into jail (lol). If I would get such a letter (what exactly would be stated in an executive order similar to 6102 but for bitcoin? I have to remember a number I might indeed have forgotten?) I would try to stall as much time as possible. They will not waste their time with people who are willing to waste their time. They will go for the low hanging fruits and the public figures that are obviously heavily involved with bitcoin first. At least that's what I think is most likely going to happen in such a scenario (ignoring that I can't even imagine how such an executive order could look like for bitcoin).
Btw, that's also why I try to take my online privacy serious. Plausible deniability might become a life saver. Don't be a low hanging fruit or public figure.
However, I have to admit, not being located in the US might make me biased. I have zero trust in my country being able to pull of such a thing for multiple reasons on multiple levels.
If I would live in the US and thus have gathered more first hand experience with "American culture" I might be more worried.
One of his principal points is that "ban" doesn't mean the thing will cease to exist. Dunno how he could have been be more clear about that.
The state is and always has been remarkably successful in prosecuting people at scale for being naughty, and ruining lives in the process, and a 100% success rate is not required to achieve those ends.
If you think rounding up a bunch of people and throwing their asses in jail or destroying them with legal process is beyond the capabilities of the US Govt then I don't know what to tell you. That's all that's needed for the "ban" described in the thread to play out to devastating effect.
Or so the argument goes. I'm hoping to be convinced otherwise but so far, no joy.
It’s certainly possible that the doors could suddenly close in any particular country—getting them all to align at once is another matter. I’d happily spin up a VPN and buy bitcoin at a 99% discount. Unfortunately, I have this problem where any bitcoin I purchase online gets the keys lost forever so I won’t be able to return it, sry.
I think he needs to define what he means by end bitcoin. (He said crypto, but let's focus on bitcoin).
If by end he means collapse the exchange-quoted last-traded-price, then he's right.
If by end he means massively reduce the amount of holdings and usage for mainstream commerce, then he's right.
If by end he means ending the chain so that no more valid blocks are being produced, then he's wrong. Bitcoin will continue to operate and those who want to use it will continue to find a way, even in the U.S. In fact, I can see a scenario where the black-market price of bitcoin continues to go up after some initial shock, because all this scenario does is reinforce the need for a monetary system outside nation-state control
I think you and he are in agreement. He says explicitly that btc will keep chugging along, even if it's at $100. A lot of people claim to be fine with that outcome, but I don't think almost anybody in the space would really be fine with it.
It might make the network more resilient 50 years from now, though.
One point of disagreement is that I think the price of bitcoin could recover fairly quickly after the initial shock. There are still many countries besides the US where bitcoin can be used, and such an action by the US govt only highlights the need to have assets resistant to capital controls. Although US customers won't be able to purchase bitcoin easily, I think there will still be a demand for it and the black market price could rebound fairly quick. I don't know if it will come back to $42k, but I also don't think it would stay at $100 for a decade either.
Given that all functional governments (who have monetary sovereignty, rule of law, functional tax systems, etc) have reason to fear btc for the same reason the US govt does, the "safe haven" / competition argument has always seemed dubious to me, as 6529 points out. Which leaves the governments with nothing to lose -- maybe the ones who don't control their own currency anyway could be friendly to btc even in the face of US opposition?
Although it remains to be seen how friendly they'd be when the thumb screws started tightening -- look at who fell in line leading up to Desert Storm. I think a lot of bulls have a super false sense of security about this. On a scale of 1 to 100, I think that, to date, we've seen state opposition at about ten.
I hope we never see it get any higher, but if it goes to 85, I guess the silver lining is that we'll have answers to these questions.
fiat-to-crypto exchanges will terminate operations in 30 days
It seems like the chances of this decrease if companies like Coinbase (and other institutional interests) continue to grow. But Coinbase won't grow if industry regulations keep coming. The whole industry is speculating on the freedom to transact on the internet and stifling that stifles the industry. I think they've already done enough to keep bitcoin dormant in the US and I don't think they'll need to do anything as drastic as this thread suggests to prevent transacting.
I already expect bitcoin to be a grey market asset for the average US citizen over the next few decades. They'll continue to make it so impractical to use legally that it'll mostly be a store of value for privileged folk.
If Bitcoin begins to seriously compete with government bonds and the US government is not prepared, however, I think the probability of this is closer to 100% than 25%. I can imagine us going to war with a country that's pro-bitcoin where every US bitcoin exchange, person, and company becomes an enemy sympathizer. We'll have an Orange Scare.
Bruh, ever heard of peer-to-peer? Bitcoin does not need exchanges to function.
In this day and age, a western "democracy" banning something like Bitcoin would only raise more questions. This is not 1933 America which walked into Executive Order 6102 like sheep.
The State would need an extremely strong reason to do it (such as planned massive debasement of currency). That reason would get leaked immediately, spread like wildfire accross the Internet and generally have the exact opposite effect, i.e. p2p usage would skyrocket.
Sure, coins already locked up on exchanges would be captured but have fun going door to door in the most heavily armed society in the world, attempting unconstitutional siezures. You'd get some lead in the face or a surge of boating accidents.
(BTW I can only comment on the first page of the thread because I don't use Shitter.)
All this coming from someone unwilling to use a human name? I view his points as a stretch. We are approaching year 15 and usage and adoption are at all time highs. Don’t discount how much Bitcoin the US government has!
endbitcoin. (He said crypto, but let's focus on bitcoin).endhe means collapse the exchange-quoted last-traded-price, then he's right.endhe means massively reduce the amount of holdings and usage for mainstream commerce, then he's right.endhe means ending the chain so that no more valid blocks are being produced, then he's wrong. Bitcoin will continue to operate and those who want to use it will continue to find a way, even in the U.S. In fact, I can see a scenario where the black-market price of bitcoin continues to go up after some initial shock, because all this scenario does is reinforce the need for a monetary system outside nation-state control