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Comment by dclowd9901 | Hacker News Reader

There's something I can't reconcile in my head about crypto: What is the vested interest in a country like the US allowing crypto to become the de facto world currency, thus stripping the power of the Reserve away from the US (and indeed any other country with an interest in managing its own currency)? Doesn't it behoove countries with this interest to work to the bitter end to prevent crypto from becoming de facto?

And if I'm right, and crypto _can't_ become de facto, what is it aside from a security, since it would have no "home"?

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A decent fraction of the people in charge of making these decisions understand that new, risky forms of enterprise can lead to benefits for a lot of people.

Despite being a regulatory body, the SEC has a very free-market culture.

I think you're right insofar as wanting to get out of the way of companies, but I think when it comes to something as fundamental as _the currency which operates at a national level_, it would decidedly be more cautious, especially in giving away the power to inflate or offer 0% interest overnight loans.

> What is the vested interest in a country like the US allowing crypto

There is a reason US is called "leader of the free world", and why "freedom" is such an used word.

And we are way away from crypto replacing anything.

For its part, the US doesn't seem to have an interest in actual freedom, but rather, "freedom under the confines of what the US wants." If the US loses control of its currency, it loses control over things like, for instance, the 2008 market meltdown. I don't see the US willingly waving its hands during a scenario like that, saying "Welp, sorry, can't do anything about this, it's all crypto now."

> And we are way away from crypto replacing anything.

Unless there's a way for the US (or any respective region with a currency) to dig its population out of these catastrophes, it seems like we are infinity away from crypto replacing anything.

The main reason is that its not 2012 any more and the executive branches already know what crypto is and won't spend resources on that war of attrition.

The do-ers in government already know that their available tools to stop crypto would only slow it down as it routes around them.

The legislative branch could easily take a less educated reaction, and you saw that in 2011-2012 in the US. In the meantime, crypto grew faster than the knee-jerk machinations of government could react and it is already big enough and the officials are more educated about it.

There doesn't need to be a vested interest in the governing institution. Distributed ledgers offer a chance at a more efficient and egalitarian form of governance itself, without invoking the 19th century political ideologies that shaped the 20th century and now prevent anyone from proposing anything radical. Blockchains and DLT currently don't achieve that, and various agencies in the executive branch recognize its ability to offer them benefits and adapt to reach their potential.

I just don't see it happening unless the government itself issues a crypto currency (which it very well could).

> There doesn't need to be a vested interest in the governing institution.

You seem to believe that currency has no value but what we attribute to it. This is false.

what is the value of currency besides the value we attribute to it?

The price of a standing army, stability of a country's market, faith of its people in its government institutions. If you go blunt with it, you can say that a country is worth, in real terms, its GDP times its predictable future stability in years.

A couple possibilities:

1. As long as lots of money is being made, wealth created, and economic growth happening, politicians are willing to suspend action in shutting it down to see where it goes. They may not be not sure whether it’s a bubble or legit growth but won’t do anything until the answer to that question becomes more obvious than it is now.

2. “Blockchain not Bitcoin” has given cover to continue development of the technology under a dual use concept - the tech developed by permissionless cryptocurrencies could be of great value to enterprise blockchains. Lots of lobbying around this the past 5 years.

3. Politicians believe crypto won’t become the de facto world currency, for various reasons. The tech is too messy and risky (true), or they control certain gateways like fiat on/off ramps.

4. Ultimately the govt decides what is “legal tender” for payments, debts, and tax collection. Meaning the USD or other national currency is the only one ever guaranteed to be accepted in that country for debt payments and tax collection. Crypto may co-exist with it, but never fully replace it for that reason.

There’s a lot of hype and wishful thinking around crypto, and it’s fun and fascinating technology for sure, but there are decades of development to go before it’s realistically conceivable it could become the defacto global currency.

That said, it’s not necessarily a security just b/c it has no home. Money originally evolved as a tool invented by people not governments. There’s precedent for money being a grassroots thing rather than a centralized thing. Cryptocurrency is just a new way of doing that.

What is a potato? It can't become a de facto world currency, and it's not a security.

It's a commodity.

The zero sum effect of cryptocurrency displacing central banks is only one part of the potential set of effects. There's also the potential impact of cryptocurrency revolutionizing finance the way the internet revolutionized communication, and that has broad-based benefits for all interest groups.

Other comments aside, it strikes me that it makes for an amazing way to:

Launder money for black projects.

Track people who think they’re beyond the reach of government.

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