| You don't even have to look to geopolitical analogies. It's an everyday thing, all the way down to basic "exclusive club" gatekeeping. There's a longstanding tendency across financial systems historically to use the law to bar access to the "real" products for various reasons that happen to favor the incumbent elite. Instead, if you get any access, it's the version mediated by a middleman of some kind. There is often a rationalization in play, but the effective control over societal outcomes is the same. Want to found a disruptive company in 16th century Europe? You had better have a royal charter. Maybe it's the 19th century and you have a great invention: "Patent fees for England alone amounted to £100-£120 ($585) or approximately four times per capita income in 1860." [0] You're a laborer in 1900, and you've pooled a little nest egg you want to use to trade stocks? You can't afford the real stuff, so you will have to play in a bucket shop. You're a middle-class Black person in the 1950's US and you want to own a home or start a business? Redlining ensures that you won't get a good deal or your neighborhood of choice, neither will you get a loan from the major banks(at least, not one on reasonable terms). And so I have to conclude that the whole basis of the debt system is always subject to some form of gatekeeping, at some point, and that's what has drawn people back to precious metal exchange over centuries, despite its limits. We've been through a long period where debt worked really well, because our economies experienced industrial growth patterns and could coexist within a stable framework(some world wars and interventions notwithstanding). That does not mean it's better or forever. The same kind of framework is in the process of being enforced in cryptocurrency; cypherpunk-friendly privacy coins that have some adherence to Bitcoin's original spirit like Monero or ZCash have been delisted from most exchanges through regulatory pressure, while defanged "blockchain economy" tokens have stones-throw availability and heavy promotion. Meanwhile a substantial number of token exchange services will play games with your ability to withdraw to keys you own. But I think that's going to be about as hopeless an endeavor as stopping music piracy was; it's abundantly clear that we're headed towards a long term trend of breakdown in "trust me" debt economies and their model of operation, even if some of the leaks get plugged in the near term in the way that Spotify "solved" piracy[1]; what "trust me" now results in at Internet scale is increasingly sophisticated ransomware hacking. So, while debt and lending itself could still exist and be a rewarding venture, tokens lacking credible mechanisms to back their fundamental value and consensus are going to wash out. (I also think the El Salvador plan is a stunt - a way of marketing the country with a side of personal benefit - albeit one that could become consequential in surprising, unpredictable ways, in the way Bitcoin has been generally.) [0] https://eh.net/encyclopedia/an-economic-history-of-patent-in...
[1] https://www.digitalmusicnews.com/2018/03/22/music-piracy-spo... |
And I switched from a mild crypto believer to a metal stacker a couple of years ago.
I think one of the next big avalanches will be some more issues with crypto exchanges. There's a lot of people in the crypto space without the technical knowledge to properly secure their assets. I was one of the people who got burned by Mt. Gox. It wasn't everything, I had multiple wallets under my own control, but it was enough to hurt. And that wasn't a one time event.