Not a crypto person at all but I do remember when the last US president ripped up the Iran deal which afforded the International Atomic Energy Agency the right to inspect their operations and replaced it with... nothing. I think this is proof enough that all of the talk about Iran being a threat (to the US? to the world?) is vastly over hyped.
Now we’ve got warhawks, oil companies & the finance industry all working together with Iran as the bogeyman driving all their policies. Watch for Yellen or congress to drop some “bitcoin supports Iran” talking points any minute now.
But yes, I agree with most of what you said, also what Jellen said about global corp tax is kind of messed up. They don't want to go after their own big corps, but rather control the rest of the world. As long as the fiscal years start at different times, they can still shuffle money around as they please, but nobody actually dares touching the US corps in the US.
Of course it is, otherwise it wouldn't be a government. People get really silly with this. Governments can define laws, enforce them and so on. They have many rules that apply to them and not to everyone else. That's the whole point.
You cannot imprison other people, but your government sure can. There are many cases where the government has special jurisdiction as compared to citizens and it is clearly recognized as a moral thing to have in democracies around the world.
However, in this practical case, the government is forcing people to make bad choices (to use a second rate fiat currency). It understands it is forcing people to make a bad choice, because it doesn't want to make that choice itself.
This is the thing I don't get about more tin-pot dictatorships. It is obvious why the States force people to use their first-rate fiat currency - the US benefits hugely from people using the dollar.
It is obvious why Iran might force its citizens to use the US dollar - if they didn't they probably get invaded by the US on some flimsy pretext.
But why force people to use a local fiat currency? It just makes their country poorer. Why are there all these idiots who look at their own economy and think "gee, this thing might work to well if we let people save in a liquid asset"?
How do people think they are going to generate wealth if not incentivising people to consume less than they produce? It is the only reliable path. Why do all these governments find it so scary?
It is unjust to delegate moral rights we do not have, and could no not legitimately exercise on our own in the absence of a state, like jailing peaceful people, to the state.
People who aren’t the government do, in fact, do that.
With a strong and effective government, there is a high probability that they eventually face significant adverse consequences for doing so, which may deter those who are deterrable, but even then it still happens.
There is an estimated 40.3 million slaves on Earth today. Just throwing that out there.
You don't get to complain when honest people lose cumulatively billions of their hard earned savings to scammers and hackers.
You don't get to complain when peope hire hitmen, buy drugs and child porn with it.
You don't get to complain when data mining centers hook illegally to the power grid and steal millions of dollars of energy.
Or when countries avoid sanctions, or manipulate other countries through it.
That's precisely what decentralization and deregulation looks like. It's the law of the jungle. Enjoy.
Sanctions seem like the least harmful way to deal with bad actors at the nation state level like Iran, North Korea, and Russia. This is the equivalent of not playing with the kid who can't play fair or follow the rules. Replace playing with trading.
You might say Iran is not a bad actor, but that's not a winnable position to take.
Would you prefer military intervention over sanctions? What else can you do in these kinds of situations?
It's still very fucked up that the US signed a treaty with Iran saying "we'll lift sanctions if you do X", Iran did X... and the first thing the US did after the next administration change was to say "Fuck the treaty we signed, we're putting sanctions back".
What's the message being sent to Iran? "It doesn't matter if you try to play nice, we're going to destroy your economy unless you submit as a vassal state to the US"?
Also, I don't see how the US has any sort of moral legitimacy to unilaterally decide which country is a "good actor" and which country is a "bad actor", even against the wishes of its allies (including western democraties). In a fair process the US would only be one of several countries deciding together, and would only act with common backing.
If your answer is "moral legitimacy doesn't matter, because the US has the power to enforce its decisions", sure, that's true. Enjoy it while it lasts.
But don't act surprised when other countries start banding against US hegemony.
Yeah it is fucked up. What is the word of the US worth if it's going to flip flop every time the party in power switches. That's going to have ramifications.
> Also, I don't see how the US has any sort of moral legitimacy to unilaterally decide which country is a "good actor" and which country is a "bad actor", even against the wishes of its allies (including western democraties). In a fair process the US would only be one of several countries deciding together, and would only act with common backing.
Every country can decide for themselves who are good and bad countries, and they're free to take whatever action they feel is appropriate, including war. That's how nations work. Now some actions have consequences, and some nations have more or less power and influence. The US does have some moral authority in that it sometimes stands up for what's right rather than what's in their best interests. For example, bans on buying conflict minerals.
The UN is supposed to function like you're saying, but in reality it's quite dysfunctional. Because of the veto system the default action is no action so it's hard to agree on anything.
> But don't act surprised when other countries start banding against US hegemony.
They can and they will, but such is the nature of things. Nations rise and fall.
More like the equivalent of the school bully threatening to beat up any kid who plays with the kid he doesn't like.
They're not an American client state, bit they're no worse than America, China, or Saudi Arabia
You can argue that they're a threat to american interests and an embarrassment to the American intelligence agencies, but that's not exactly the same as being a bad actor.
China and Saudi Arabia are pretty dirty, but I don't see the US in that camp lately.
https://cepr.net/images/stories/reports/venezuela-sanctions-...
That's the two wrongs make a right logical fallacy. That the US did shit to Iran does not excuse the shit Iran is currently up to.
The book, "Twilight War," has a lot of material background on the matter.
[0] https://www.wilsoncenter.org/article/irans-islamist-proxies
[0] https://www.reuters.com/article/us-iran-iraq-proxies-insight...
You: economic sanctions are immoral!
Lol.
So, how do you feel about throwing gay people off buildings?
Edit: Yes, I know this isn't any part of why we have sanctions against Iran. But it should be.
I come from Venezuela, I have family in Cuba. I know what economic sanctions look like and what they do against dictatorships. Hint: they do nothing, because they're not going to abide by your rules or meet you in the middle.
This was mostly a knee-jerk reaction on my part because it often seems to me that in the rush to (rightly) denounce bad policies by the U.S. or other countries against Muslim majority nations/groups, the fact of extremely barbaric practices by some of these groups is just swept aside, like it's okay because they're being victimized. It's still not okay.
Regardless, I concede the point. I'll leave my prior comment up, though, because I can't be alone in these feelings and your response provides more nuance to the issue.
The US doesn't embargo Iran because of that. Otherwise they'd probably have to embargo a bunch of their closest allies for half a century or more.
It's all realpolitik, morals don't influence this issue much.
Besides, it was ISIS throwing gay people off roofs and filming for propaganda. Iran has an authoritarian system with it's (many many) own sins, but it's no different than any other country in the Middle East. All are terrible, but some receive love from the west and some don't.
[1] https://en.wikipedia.org/wiki/LGBT_rights_in_Saudi_Arabia
An international body has at least some checks and balances to keep it close to the truth.
At a consumption rate of ~1% of the potential exportable amount, this doesn't seem like a particularly significant evasion of sanctions.
The Iranian people impoverished by sanctions would beg to differ (no pun intended).
It’s possible bitcoin may produce something someday. But look at it from an outside perspective: a bunch of people, motivated by an idea, have got together and commissioned the burning of coal and oil on a vast scale.
Bitcoin more or less operates as “proof of carbon”. Imagine if a crypto network operated by “proof of art burned” or “proof of buildings destroyed”. And people got together and directed capital towards buying up art and burning it, or buying real estate and knocking this down.
And this secured their currency network. You’d have to have some very good output from the network to justify such waste.
Because proof of work is proof of waste. That’s how it’s set up and secures the network. Unlike existing systems it is antiefficient. And currently it is setup to waste carbon and GPUs.
As well, what major difference would there be to the world if bitcoin vanished overnight? What real-world value is it providing to us?
I don't see the costs of bitcoin being worth the benefits.
Nixon created it when he decided to leave the gold standard after France demanded physical gold as payments.
Iran and other countries under US sanctions use alternatives including barter. Bitcoin can just be one of those tools. But bitcoin mining is more a function of cheap electricity and high bitcoin prices. Electricity is cheap in Iran. 4.5 percent of bitcoin mining is negligible given the context of the sanctions. One would expect it to be at say 20 percent as their is an American embargo on the country.
This just seems to be more of a click bait article for self promotion or company promotion.
This aspect was not clear to me until I read The Bitcoin Standard by Saifedean Ammous, the first two thirds of which is more of a history of money than pro-Bitcoin propaganda. There he argues that moving off the gold standard was a bad idea in many ways apparently unrelated to money.
And of course there's this famous website: https://wtfhappenedin1971.com/. For reference, 1971 was when Nixon decoupled the US dollar from gold.
See Money: The True Story of a Made-Up Thing by Jacob Goldstein (of NPR's Planet Money):
* https://bookshop.org/books/money-the-true-story-of-a-made-up...
* https://en.wikipedia.org/wiki/Jacob_Goldstein
From what I've read on the topic, gold (and 'hard money' in general) is generally not a good in most circumstances. Yes, if your mint/central bank takes orders from the government to create more money it can lead to bad things, but generally that disaster only needs to happen once before everyone realizes how bad an idea it is and probably never does it again.
Recommend the book. Debt: The First 5,000 Years is also worth checking out:
>but generally that disaster only needs to happen once before everyone realizes how bad an idea it is and probably never does it again.
That clearly isn't the case or else no country would have experienced hyperinflation after the fall of Rome.
Keynes's Bancor[1] was essentially this idea, but Bretton Woods conference rejected this proposal. Oil exporting and general surplus nations, like Russia and China, have been moving in this direction by reserving more gold in recent years (look up various European nation increasing gold purchases since 2008) likely to move towards a more multilateral system of settling trade imbalances with a neutral settlement asset, rather than stockpiling fiat currency or fiat currency debt "assets" created in unrestricted supply by one nation, who forces world to then use this inflating currency to purchase energy... which equals future inflation for these nations that can't print it themselves.
It is also useful as a personal "store of value" to avoid "saving" in a depreciating fiat currency, along with other "hard" assets.
But gold or hard money cannot be the unit of account or medium of exchange for national commerce. Credit/fiat is better for this.
This is why some have argued that there's always been and probably always will be a need for "two monies". Bimetallism was an embodiment of this principle. Here is a very thorough discussion of this concept[0]. Ctrl+F "two monies" for specifics, but the whole article is insightful.
This dynamic also presents itself in debates about crypto currencies purpose to function as a high throughput transaction currency or a more inert store of value. Because of the inefficiencies of blockchain and Bitcoin's finite quantity, it cannot function as a unit of account or high volume transactions currency; fiat and fiat derivative platforms (Cash App, Paypal, credit cards, etc) are much better at serving this function. Trying to shoe-horn hard money into soft money use cases (or vice versa, saving in fiat) doesn't work. One form of "money" can't satisfy these two distinct functions.
[0] http://fofoa.blogspot.com/2011/05/return-to-honest-money.htm...
What you want is for the increase in the money supply to match the increase in productivity. What we care about is a stable M2V.
Here’s a quote that summarizes the effect of the time period nicely:
“The Nixon campaign in 1968, and the Nixon White House after that, had two enemies: the antiwar left and black people. You understand what I'm saying? We knew we couldn't make it illegal to be either against the war or black, but by getting the public to associate the hippies with marijuana and blacks with heroin, and then criminalizing both heavily, we could disrupt those communities. We could arrest their leaders, raid their homes, break up their meetings, and vilify them night after night on the evening news. Did we know we were lying about the drugs? Of course we did.”
— John Ehrlichman, to Dan Baum for Harper's Magazine in 1994, about President Richard Nixon's war on drugs, declared in 1971.
That’s what the fuck happened in 1971. Then, notice how many graphs actually show an inflection point around 1981 when Reagan started as president, employing Nixon’s Southern Strategy to get elected and then serving those voters with policies that attacked the lower and middle classes (slashing spending on federal aid programs, raising income taxes while lowering capital gains taxes, freezing the minimum wage, raising military spending which is essentially a cash transfer to rich arms dealers, etc). Then throw the Cold War in there, and you have a US government that is in an adversarial position with everyone but the 1%.
ps: I say this as a non-American.
One of the more interesting quote's I've encountered along the way, "The foreign tax rates of U.S. oil multinationals fell significantly after the first Gulf War, during which the United States intervened to protect Kuwait, a major oil producer. Although it is not possible to know for sure what caused this decline, a possible interpretation of the fall in taxes collected by oil-producing countries is that they reflect a return on military protection granted by the United States to oil-producing States."
Figure 2 on page 20 has the discontinuity.
Let's look at how the petrodollar came about. The first step with the run on gold in 1971 which broke the Breton Woods system. The value of the dollar went through the floor. Having a big navy didn't make any difference. This hurt oil exporters because now their dollar earning weren't worth as much, but they didn't abandon dollars. There was no credible alternative, and there was no military dimension to that fact.
Then in 1973 US support for Israel lead to the OPEC oil embargo. Oil prices quadrupled. You could say it was American military aid that caused this, well maybe but no actual projection of force by the US was involved. Military aid to Israel was no different in character from Soviet aid to Arab regimes. The reasons the embargo mattered and had an effect were economic reasons, not military ones.
When the United States-Saudi Arabian Joint Commission on Economic Cooperation was established in 1979 the US hadn't invaded any Middle Eastern nation, hadn't blockaded any Middle Eastern ports, hadn't established any bases in the Middle East. The total of their interference was support for Israel, a small state a long way from any of the actual oil.
All three of those milestones were entirely economic in character. Military power projection played no part in them. The US has and uses economic power anyway, regardless of how effective it's navy or army is. It was a military midget, but economic powerhouse in 1941 when Japan attacked Pearl Harbour. It parlayed that economic power into military might, not the other way around. By the end of the war the US was launching 2 aircraft carriers per month due to sheer economic muscle.
US military intervention in the Middle East long post-dates the establishment of the petro-dollar. Those claiming the petro-dollar is a result of military power have it exactly the wrong way around.
Armed force superiority is a requisite for maintaining order, which is a valuable good in and of itself, but the country also needs to produce goods themselves (such as research, medicines, technology, media) which is greatly enabled by a large population that has a higher than average level of trust between each other.
I would even assume the latter is far more difficult to create than the armed forces, and only arises from a perfect storm situation. And it feels like it’s in a downward trajectory, but hopefully that is not true or will reverse.
The Eurozone can do so as well. Actually, it must do so to prevent the collapse of the euro. It's the same with the USD, foreign nations keep "stealing" USD and take them out of the US and therefore the US must replace the lost USD just to stay still.
Also, the fact that no money is being printed is one of the biggest problems. Yes, you can increase the money supply without printing. For every USD you create, you also create an obligation to return it which is called debt. When the newly created USD are allocated to otherwise idle resources you may unlock value equivalent or higher than the debt you took on. The excess value you have created in the process is called economic growth. It turns out, fiat creation is highly deflationary and deflationary forces from other sources are extremely high as well. However, debt is inaccessible to the vast majority of the population. I personally still get 4% interest rates on private loans. The borrowed money never ends up in the real economy indicated by low inflation rates.
We are basically experiencing the great depression again but to a milder degree, therefore we should do our best to prevent it from becoming a problem in the first place. The fact that the US hit inflation goals because of a pandemic is pathetic. What if they were not blessed with a natural disaster that spurred politicians to act (it wasn't enough to get trump to act)?
Hitting inflation goals and moderate interest rates quickly is absolutely necessary to keep the economy stable. With every year of low interest and low inflation the imbalance keeps growing but the correction will happen in a flash, therefore we must ensure that any imbalance is as small as possible before we run into the crash.
It's like extinguishing wild fires as soon as they happen while the fire is still under control. At some point you can no longer contain the fire but the consequences have become unbearable.
It's better to crash small today, than crash big tomorrow. Unfortunately, today is many years too late.
Currently, there isn't a country that isn't doing this.
But I agree, when the music is gonna stop globally the US can print the longest.
+50% since 2016, +20% since pandemic started.
In a fashion, the US printing dollars lowers the value of a dollar which effectively taxes the rest of the world by lowering the value of their dollar denominated assets. Particularly oil. Still it’s an odd system as the US is ultimately on the hook for that debt, to US federal debt holders who are still majority Americans.
It’ll be interesting to see how post-oil world economy will handle it. Possibly more serious large scale wars between regional powers.
This article explains the link between Saudi Arabia and the US. It explains a lot about the relationship that exists despite so much chaos and turmoil. As they say, money talks and bullshit walks.
Interesting. It seems like they're basically saying that mined blocks should be accepted based on the location of the one submitting it. This whole article seems to be a sales pitch. Lets see how decentralized and unregulated Bitcoin really is.
>This level of Bitcoin mining would currently bring in annualised revenues of close to $1 billion.
I wondered how they came up with that number. Miners currently seem to earn around $30 million per day[0]. 30*365*0.045 = ~500 mil. Seems like they conveniently used the highest recent rewards of $60mil per day. The statement just seems sensationalist at best, all things considered.
That's silly. Mining doesn't use a lot of bandwidth, so setting up a tunnel to mask the origin of the block would be trivial. The moment Iran's blocked, why wouldn't miners do that?
This implies forking the blockchain. So some clients will use "curated" blockchain. I don't think that this fork will be popular.
They're not talking about censoring/forking/manipulating the chain. They're talking about centralized financial services built on top of bitcoin blocking coin that is linked to Iran.
- legitimate miners should be willing to spend $1 mining to gain $1+delta
- launderers should be willing to spend $1 (dirty) mining to get $1-delta (laundered)
So launderers should outcompete legitimate miners.
“Ulterior motives” includes a lot of things. It definitely includes money laundering (see Iran and China) but it also includes people who mine so they can conduct 51% and MEV attacks on the network. On the positive side it may include pseudo-altruistic types such as major currency holders, who are willing to mine at a loss in order to support the currency’s value. The thing all of these parties have in common is that none of them are incentivized to mine honestly solely because of the intrinsic profits involved in mining: your hope is that their ulterior motive is compatible with honest behavior. When that isn’t born out, your network runs into trouble.
* Obviously in the real world there are tons of capital expenses and prices fluctuate wildly, so this model is loaded with inefficiency that can allow some folks to make money on mining as a business in and of itself. But PoS systems will have fewer such inefficiencies.
[Edit: Actually matthewdgreen is right in a sibling comment, that the argument can be made without considering laws as such]
or laundry mat…
or car wash…
or…
The petrodollar system is why the USD was able to retain status as the international reserve currency even after Bretton Woods: https://en.wikipedia.org/wiki/Petrodollar_recycling
Why should the US be able to do that?
The US cares about the Syrian deaths about as much as they do about those in Yemen. Morals play absolutely no role here. And when a politician howls something about humanitarian reasons you can be sure it’s a farce.
What matters is giving head to the right person. Do that, and anything is fair game.
Especially since they fueled the war themselves. Regime change is less risky if you can just pay people on the ground to do it for you.
Whether one side or the other has in the past acted immorally is irrelevant. You don't win the argument by saying "America has done bad things too", as if that should persuade it to change its behavior. It's a category error; nothing but ineffectual emotive fluff. You'd have more traction arguing that sanctions are, in fact, not in America's long term best interests.
Also, the supreme leader is at the top of Iran's power structure and is not elected by the iranian population.
I don't know the history super well but I would speculate that either Iran wanted to sell oil in another currency, or the other oil exporting countries we got in bed with (OPEC) didn't like Iran, or another one of our allies (Israel) didn't like Iran.
I'm not saying the Iranian government doesn't do bad things - it absolutely does, though you could (easily) argue that the US has done far worse. Hell, you can also (again, easily) argue that the US and UK are largely responsible for many of the past wrongs of Iranian governments.
As a singular anecdote from 21 years back, I spent a couple of weeks in Iran way back in 2000 (my father was working there as a geologist for an oil company and I joined him during the summer holidays) - things seemed very different than I'd been led to believe. I felt completely safe wandering Tehran alone, and everyone I came across seemed extremely friendly and curious. They seemed to know how their country was portrayed outside of Iran, and wanted to show me otherwise. People talked freely about politics too, expressing likes and dislikes just like any western nation. And the food, my word the food...
"As Iran sentences Nazanin Zaghari-Ratcliffe to a further two years in Iran, her husband outlines why the UK’s secretive, unaccountable arms trade is a danger to British citizens and why his family remains haunted by an unkept promise made by the UK government."
https://www.dailymaverick.co.za/article/2021-05-01-nazanins-...
This government didn't install itself.
Brought (unwillingly) into power by the US once more:
https://en.wikipedia.org/wiki/1953_Iranian_coup_d%27%C3%A9ta...
>I’m not exactly sure the Iranian government are particularly nice people.
One could say that about the CIA and the US-Government too.
Whatever your feelings about US/Iran or your feelings about Bitcoin/Climate Change, sanctions have been an effective peace-time tool for the UN to bring countries to the negotiating table. Perfectly effective? No. Security Council politically motivated? Yes.
Better than war for the citizens of all countries? Yes.
Will Bitcoin lead to more war as a result of weakening the power of sanctions? I wouldn't hazard a guess. But I didn't see this possibility coming.
If one values international law, or the, "international order" (as Secretary of State Blinken put it, without irony), then a bright line needs be drawn between, "international sanction tools" that are used by the UN and the unilateral sanctions issued by the US.
>Will Bitcoin lead to more war as a result of weakening the power of sanctions?
Bellicose nations have always issued demands to other sovereign nations backed by the threat of illegal wars of aggression. Will the ability of targeted nations to avoid being starved to death via the use of bitcoin lead to more war? Possibly, but is the problem there really bitcoin, or rogue nations who consider themselves above international law?
Yes, exactly. They (in part) defeat an act of unilateral violence, one that is very cheap for the perpetrator, from one country against another. Which seems a very good thing.
From a practical perspective Bitcoin is effectively a virtual, self declared nation state but the only thing that exists within that nation is Bitcoin itself. Thus military expenses in the form of Bitcoin mining only cover a small subset of protection offered by conventional military.
Because of this, most Bitcoin proponents are extremely narrow minded, they think the currency equates the entire nation, therefore the USD is equivalent to the entire US and only protecting the USD is equivalent to protecting the entire nation.
Every day people run into the same problem with rent control. They believe there are no real resource constraints represented by the price, therefore they believe changing the price alone is enough to solve the problem. Yet they never realize that prices are just information used to allocate scarce real resources. If information is manipulated and no longer reflects reality then it has become a lie and therefore serves nobody except the one who told the lie.
Okay now that we have established that currencies are information that reflect the allocation of real resources, then what real resources does Bitcoin allocate? It allocates a share of real resources around the world based on the people who bought and sold it. The irony is that these real resources are being protected by their respective governments, thus the existence of the US military (and all other militaries) is an essential part of Bitcoin's current valuation.
Sadly this is true, but not for long. Bitcoin adoption is still very small but it will grow. Once it grows to cover the vast majority of merchants in the world, the next flip of a switch will be in people's minds: they will start valueing things in bitcoin (or bits, or satoshis), instead of USD, EUR, etc. (In pretty much the same way people switched from drachmas to euros recently...)
And once that happens, people will stop thinking of the fiat monetary value of one bitcoin (or bit, or satoshi), and then your statement will not be true anymore.
No country is going to give up its control of monetary policy in exchange for cryptocurrency - there will simply be digital currencies also controlled by governments. We already see this happening. The result will be even more traceable, controllable transactions - not this anarcho currency you're envisioning.
That's really no different than bitcoin. With USD a ton of energy is used to protect what backs it, which is physical resources. With BTC a ton of energy is used to protect what backs it, which is the chain.
Military also protects against external threats (like other countries). Mining also protects against external threats (like bad actors).
Historically prior to the 1900s pretty much everywhere was on a gold or silver standard of some sort.
The US has national interests economic and strategic that exist independently of the reserve status of the US dollar. The sprawling US military infrastructure does not exist to preserve the status of the dollar, it exists to protect these interests. The US doesn't operate bases in Germany and Japan for the dollar. Or do you really believe that should Bitcoin replace the dollar as the international reserve asset, these military bases around the world would be closed down?
The importance of the petrodollar is vastly overstated and the reserve status of the dollar has far more to do with the liberal attitude the US takes to foreign capital flows and the size and depth of US economy and consequently its capital markets. Mercantilist economies such as Japan and China would be unwilling to accept foreign capital flows appreciating their currencies and making their exports more expensive largely because of the domestic political issues this would cause.
4% of the post-sanction exports. It seems that the sanctions "evasion" does not have an impact on the efficacy of the sanction.
Instead of seeing Iranian mining boom as some tech-enabled sanction workaround, I see it as just that -- a boom just because electricity is cheap.
It's been a good ride.
So...if I open a mosque and mine Ethereum instead of Bitcoin, can I still get some of that free electricity?
the subtext here is obvious: dear normal people, Uncle Sam will not tolerate a competitor to the USD. get out before we criminalize crypto.
