149 sats \ 2 replies \ @nullcount 31 Jul 2022 \ parent \ on: For those who dislike Monero…why? bitcoin
I forgot about the frequent hard forks and I agree it add centralization pressure and limits the "rights" it's holders have which is why I don't invest in XMR.
However, BTC sidechains like Liquid add even more centralization to achieve confidential transactions. Similarly with Fedimint. And to some extent, LN has centralizing effects as well since we're all reliant on whatever features the major implemtations decide to add. The difference is that the "asset" in these systems is redeemable 1:1 with BTC (LBTC, ecash tokens, and millisats in a channel)
If Monero was somehow implemented as a privacy layer for BTC without a token, or you could use it via atomic swaps in such a way that never exposed you to XMR volatility or it's consensus rules, would you consider it a shitcoin? Assuming it provides useful privacy in areas where it would take more work or be more expensive to achieve comparable privacy on BTC?
Great point!
And they are working on atomic swaps wirh BTC as we speak 🙃
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Now that I think about it, it's possible to use monero right now without exposing yourself to its volatility. If you use an exchange where you can short monero on the xmr<->btc pair, just do a 1x short.
As monero falls to lower and lower prices in satoshi terms, your bitcoin stash on that exchange will grow by an equivalent amount. Conversely, if monero grows in value in satoshi terms, your bitcoin stash will go down, but your monero stash will increase proportionally to equal out the difference. Whenever you want to cash out of monero you can sell your xmr tokens for bitcoins, putting you at the same amount of bitcoins you had when you started (minus some exchange fees).
So if you want to buy and use -- say -- $300 of xmr, first put up a 1x short on monero using $300 of your bitcoin as collateral. As you spend it, reduce your collateral til you're all out of both monero and collateral, then if you want to you can put up collateral again to repeat the procedure.
This does mean you have counterparty risk on the exchange as well as slippage risk due to trading fees and low liquidity on that trading pair. But for some people who want to treat monero like a sidechain, this is a way to do it that should work today. But the "peg" is secured by a centralized entity (the exchange), so there is that.
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