The centralisation of Libra made it easy to kill. Bitcoin can be hampered but not outright killed, at least not over night. A death by a thousand cuts is the most likely solution but by no means guarantees Victory.
> Simply hunt down vendors who accept Bitcoin and organizations who facilitate its exchange.
This is commonly a argument for having drugs illegal too. "If we hunt them down, eventually there will be no one left"
What we know now, is that making something illegal, could make it stronger. If Bitcoin becomes illegal in most country, would the price go up or down? Suddenly there is a black market, and opens up a whole other can of worms, so governments might not be able to simply outlaw it.
> What we know now, is that making something illegal, could make it stronger. If Bitcoin becomes illegal in most country, would the price go up or down? Suddenly there is a black market, and opens up a whole other can of worms, so governments might not be able to simply outlaw it.
It's not as though drugs became more popular because they became illegal. Prices may have gone up because they were harder to obtain and there's less competition. Demand was still there because.. well people like doing drugs or are addicted to them.
With Bitcoin, why would a business risk legal action to accept it? There's very little incentive as far as I can tell.
I'm not disagreeing with you, but I do think there's an allure to things that have been banned or that are illegal. For example, how many young music listeners would want to listen to an album even more after Tipper Gore managed to push through that 'Parental Advisory' warning on the front of albums?
This is not exactly a completely relevant example, but Colorado did see a decrease in teen marijuana use after marijuana was legalized recreationally (granted, it has also recently seen a decrease in teen heroin use, so the legal status may not be directly causal, but I find it interesting nonetheless):
Regarding Bitcoin, one incentive might be positive press coverage - a PR move, so to say, such as when APMEX, the popular online precious metals exchange began accepting Bitcoin in late 2017:
Many of these cryptocurrencies have non-profit foundations that push for adoption by getting ad-space at major events and pushing for the acceptance of cryptocurrencies in certain companies. Litecoin has the 'Litecoin Foundation' and they managed to get advertising for Litecoin in some UFC events. More often than not, I think partnerships like these make for good PR for both companies involved - here's a piece on why the Litecoin Foundation thought that this particular partnership was useful:
To clarify: Necessarily, if Bitcoin was illegal, any transaction with it would of course be illegal. :p That isn't to say that any and all transactions made with it, would be for the exchange of illegal goods. You can of course also use Bitcoin for the exchange of legal goods, but taking Bitcoin even for legal goods, would hence be illegal. In any case, just like people speeding, drinking moonshine, or enjoying marijuana where it's not allowed, I'm just as sure that very few would care.
Thing is, people have 'good reason' to want drugs: They feel good, and mostly, people get addicted. Moreover, there is much less of a scale requirement for drugs. It is pretty easy to make money on drugs when 0.1% of all people are using your drugs.
Whereas, a currency used by 0.1% of your friends / neighbors is totally useless.
These reasons make it 1) easier to suppress a currency 2) harder to suppress drugs.
I feel like you’re reasoning is biased, I’ve seen cocaine usage for adults 18-25 reported around 0.8% to 2.0%, and it sustains an illegal industry. I unfortunately have no figures on bitcoin participation and couldn’t find anything decent when searching on mobile, but I imagine it would be a similar niche.
Bitcoin, at the moment, isn't used as a currency. Nor is it very viable as one. Instead, it is a store of value, much like gold.
Using something as a store of value has much less of a scale requirement. You only need a few people that will be willing to exchange your Bitcoin into something else in order for it to work as savings / an investment. Whereas a currency requires multiple places where you buy goods to accept it. Moreover, those places only really have a reason to accept a currency if multiple customers would use that currency.
There's a black market for drugs because people like taking drugs. On the other hand, people only like receiving cryptographic tokens on the assumption that they will be able to exchange them for something in future, something considerably less likely if giving away products and services for alphanumeric strings is illegal... and unlike drugs, the supply of cryptoassets doesn't shrink when the government makes them more difficult to sell.
> There's a black market for drugs because people like taking drugs.
Perhaps this is somewhat pedantic, but I think it's more accurate to say that there's a black market for drugs because governments have passed laws to make certain drugs illegal and some groups of people have accepted the risks that come with supplying the demand for this particular market in order to make a profit.
> On the other hand, people only like receiving cryptographic tokens on the assumption that they will be able to exchange them for something in future
It may not be exactly this simple, although this is mostly true. There are those out there that purchase cryptocurrencies to make foreign financial transactions in a way that may be considerably more difficult with their country's accepted currency. This doesn't necessarily have to be an exchange, it could simply be sending said cryptocurrency to a wallet of a relative in a foreign country.
Do you really believe that a consortium of world governments cannot mount a permanent 51% attack against all crypto-coins that they wish? But it doesn't even need to be permanent, just a few hours would send the requisite message.
Or just block port 8333, or implement DPI and null route anything that looks like a block header or transaction, or any manner of things that can be done when the "virtual" currency still has to traverse very real public infrastructure.
Will it stop it completely? No - but put enough chicanes in the way and the incentive to use it will drop below critical mass required for it to achieve its actual long term goal, which is to undermine the power of a state to control the issue of currency (and with that, taxation).
Short term goals of facilitating grift by corrupted authorities and their crypto con artist enablers will remain largely unaffected.
Bitcoin can be killed by means other than technological.
For example it can be outlawed. Sure, people would still be able to use it, but they would be breaking the law and that would deter many, possibly enough to kill it outright.
Bitcoin does not need to be killed because it’s dead already: proved to be useless for all practical purposes, now used mostly for money laundering or other criminal activities
That's an interesting claim, all the time regular banknotes and coins offer way better alternatives for doing just that (e.g. money laundering and black market transactions), due to their much better relative untraceability as compared to just about all cryptocurrencies, and even so-called privacy coins.
The only thing cryptocurrency has clearly got going for it, is in relative better ease of use, and better security, as compared to coins and banknotes, especially when it comes to international transactions.
It's troublesome to move a literal ton of cash from A to B, while moving a virtual ton of cryptocurrency isn't. The cost and risk of moving said ton of cash from A to B, is also staggering compared to the relative security and ease of movement offered by cryptocurrencies.
Best of all, cryptocurrency just about removes the need to have a bank as a third party when both storing and moving your valuables. Thus it's a much bigger problem for banks, than governments. Remember, taxation still existed in a time when no valuables were traceable. So that fact that some cryptocurrencies are claimed to be untracable, doesn't really matter much to the state.
Money laundering and other criminal activities are a very profitable businesses that power an important sector of economy. If Bitcoin enables or facilitates them, it is far from what I would call useless.
Also: it will not be outlawed everywhere, some country will jump on the opportunity. So you earn bitcoins in one place, legalize then in another one, where it is legal. It's not so easy to prevent this, I'd even call an attempt futile.
Let's say, for the sake of argument that Ukraine legalizes BTC, while it's illegal everywhere else.
What you think will happen:
- Ukraine will make fat stacks from all the people who care about BTC. Crypto-libertarians will rejoice, issue fifty billion ICOs, and Ukraine's GDP will exceed that of the rest of the world. BTC will go to the moon, and anyone who didn't get on that train when its future was in doubt will be starving to death in a ditch, or working as an indebtured servant, soldering mining rigs for early adopters.
What will actually happen:
- Any Ukranian bank that touches BTC will be barred from doing business in USD. For a bank, this is as good as suicide.
- Any intermediary that exchanges BTC for a local currency (Hryvnia), without touching USD will be barred from transacting with any Ukranian banks, that don't want to be barred from doing business in USD.
- Anyone trying to use Hryvnia for any international transactions will be subject to strict AML scrutiny, because it is a well-known intermediary currency for laundering BTC. The burden of proof with AML is on you, not your accuser.
- The Ukranian Rada will quickly come to its senses, and, in order not piss in the cornflakes of the 99% of its citizenry that doesn't give a shit about BTC, will ban it, and stop being a pariah state in the world of international finance.
What a perfect example of a straw man argument you made! I just love when people tell me what they think I think!
No, hypothetical Ukraine will not issue fifty billion ICOs and its GDP will not exceed the rest of the world (btw it is rather ignorant to tie ICOs to bitcoin, they are completely different things).
What I think will happen in this hypothetical scenario, is that bitcoin will have a safe place in Ukraine where it can be legally turned in a very real cash USD, totally by an off-banking method. Then these USDs will be shipped to banks in Poland or Germany or Switzerland, which will accept it rather happily (as they usually do). Meanwhile, the rest of the world would continue using bitcoin for their day to day purposes, ignoring a worldwide ban. Some purposes will probably criminal [1], but many will have legal ones, especially in countries with failed fiat currency, like Venezuela or Zimbabwe. Because, you know, you can't really control a person who sells a pig to his neighbour and wants to have something REAL in return.
Should be mentioned, that if we pretend that just one country will legalize bitcoin, then it is more likely that this country will be the one least vulnerable to bank sanctions. Iran or North Korea are much more likely candidates than Ukraine.
Anyway, in reality, a worldwide ban is unlikely at this point, given the acceptance of bitcoin by too many jurisdictions already [2]. It's just a matter of time when it'll go to the moon and establish itself as the main world currency.
>Bitcoin can be hampered but not outright killed, at least not over night. A death by a thousand cuts is the most likely solution but by no means guarantees Victory.
Ignoring policy attacks, and focusing on the purely technical:
A useful metric here is to compare the cost of executing a 51% attack on Bitcoin long enough to erode confidence in the software to the military budget of the top nation states.
Additionally, the broadly assumed consistency properties of Proof-of-Work cryptocurrencies fall apart in the face of a powerful network adversary who can cause arbitrary segmentation.
Everyone seems to forget that whilst a 51% attack could easily be financed by a nation state, actually getting the hardware to perform it is the bottleneck.
