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Comment by btown | Hacker News Reader

The interesting thing is that the Chinese government could theoretically nationalize all those data centers and be very close to (or far beyond) 51% on any proof-of-work-based cryptocurrency [0]. This would, of course, be a one-way street, immediately lead to a price crash, and likely be unprofitable... but it might be viable, say, as part of a scorched-earth cyberattack to cause chaos and wipe out international wealth parked in Bitcoin.

It's heartening to see things like Ethereum moving in a proof-of-stake direction [1], and there's a lot of hope for a lot of the new cryptocurrencies out there. But Bitcoin itself is far more centralized and government-controlled than a lot of people think.

[0] https://medium.com/@homakov/how-to-destroy-bitcoin-with-51-p...

[1] https://www.ccn.com/ethereum-moves-one-step-closer-to-proof-...

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Given that money laundering is a significant use of Bitcoin, and given China's extensive history with capital controls [1] and their willingness to execute people for corruption [2], it would not shock me much to see them do this for purely internal reasons. Chinese leaders are historically not big fans of things they can't control.

[1] It's a hot topic: https://www.google.com/search?q=china+capital+controls

[2] E.g.: http://time.com/4298731/this-is-how-much-money-you-can-take-...

Why would people use Bitcoin for money laundering?

I don't understand the question. Bitcoin's aim was to be international electronic cash. People use actual cash for money laundering. Why wouldn't they use electronic cash?

If you're interested in learning more, I'd suggest starting with Google: https://www.google.com/search?q=bitcoin+money+laundering

I think your mistake stems from holding too tightly to the term "cash" used in the original Bitcoin paper.

>People use actual cash for money laundering. Why wouldn't they use electronic cash?

I'll help you to the conclusion without googling. Actual cash is not electronic, and thus tracing efforts are much harder. Electronic cash can be traced near instantly.

I really don't see why you had to have this PA tone on your comment? Could you elaborate more on your stance?

  China's [...] willingness to execute people for corruption

I read a fascinating (although very cynical) book a few months ago, and it said something very interesting about corruption.

If an autocracy needs to buy the loyalty of the army/police/government officials, instead of paying them cash the autocracy can simply turn a blind eye to corruption. That means you don't need to spend your own money to bribe them - and if any of them display disloyalty, you can simply have them executed... for corruption!

So you always have to be wary when you hear a regime is cracking down on corruption - it may be they're simply cracking down on disloyalty, while retaining their private pro-corruption stance.

Oh, yeah, I'd believe there's some of that going on here. Although I'd also believe that the real rule isn't "don't steal", it's "don't steal too much". With "too much" being defined by some combination of "more than those superior to you in the pecking order" and "in a way that causes public upset".

That has definitely been a commonly deployed trick throughout historical Chinese dynasties. However there are always two sides to it and nothing can be regarded simplistically, especially if you're talking about Xi's anti-corruption campaign. While Xi might be consolidating power with the corruption crackdown, the general welfare of Chinese civil servants have indeed been reduced a lot, to the extent that many of them simply quit and started their own businesses indeed.

Whether one likes it or not, Xi is genuinely trying to make China more like the US and letting the private market play a much bigger role while reducing government support. He's just like Reagan.

They're busier with a bigger fish.

As for Bitcoin, people can always fork it. Remember to ask the question, "What is money?" I think it's in the interest of the Chinese gov't to extract value from Bitcoin, not destroy it.

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