[sepiasaucer]

IMO the technology blockchain has only demonstrated success in 1 application which is cryptocurrency. Cryptocurrency has only demonstrated success in 2 applications: speculative investment and illegal online purchases. I would include NFT’s under the speculative investment category.

These applications are obviously problematic for 3 main reasons: it wastes enormous amounts of energy, the investment is often at the expense of less tech/financial savvy people, and most people don’t want it to be easier for criminals to conduct financial transactions.

IMO, it is not a few bad apples spoiling the bunch. It is a bunch of bad apples with a few good apples mixed in. Even if your motivations in working in this space are good (not simply for your own technical stimulation/amusement), you are trading off furthering/enabling real world harm now against optimistic speculation about future positive outcomes.

[maxilevi]

I disagree. I use crypto to protect against high inflation in my country and mantain the value of the fruits of my labour. Where does that fit in your categories?

Crypto and DeFi have a lot of applications, especially in third world countries with bad financial systems.

[notahacker]

> I use crypto to protect against high inflation in my country and mantain the value of the fruits of my labour. Where does that fit in your categories?

This is obviously speculative investment.

(Even if your local currency is so horrendous it lost more value than Bitcoin this month, less volatile ways of hedging exist. Maybe you bought lower or changed cryptoassets so you've gained far more than BTC fell, but that's speculative investment and trading, not maintaining value)

[maxilevi]

Its not. I am using stablecoins to hold currencies I wouldn't be able to hold because of capital controls.

[anon9001]

So what you're saying is that you buy ETH for its utility of processing transactions on tokenized assets? And you get more value out of spending the ETH on gas than it cost you to purchase it?

That sure sounds like a useful product to me.

I think HN is so anti-crypto because so few people in the industry currently have your use-case.

Personally, I think what you're doing is exciting and helps put a value on the utility of paying to run these contracts.

[maxilevi]

Yes and it's also much easier to trade tokenized assets between people than bonds or other financial instruments.

Also the whole DeFi ecosystem allows you to use your tokenized assets in different ways, giving even more value to it.

I think many people have my use case, it's just that you can't really see it unless you live in a country with a very mismanaged central bank. Which in my opinion is becoming more and more common every day.

[alexb_]

How exactly is using stablecoin to hold money different than holding your wealth in USD? Is it an access thing?

In any case, many "stablecoins" are ponzi schemes waiting to burst. I would much rather use a government backed currency to hold wealth against inflation than something like Tether.

[maxilevi]

The difference is you can't buy USD digitally.

You say that but imo having a currency that loses 50% it's value every year is worse than holding Tether. I don't trust Tether either and thats why I am holding DAI.

[alexb_]

>having a currency that loses 50% of it's value every year is worse than holding Tether

What are you talking about? Tether (and many "stablecoins" like it, including DAI) are entirely based around the idea that they are pegged to the US dollar. If USD has inflation or deflation, so does the coin. The "50%" figure is just completely made up, and you know it - inflation right now is pretty bad, but saying USD lost 50% of its value is just completely and utterly wrong.

>you can't buy USD digitally

...again, this is just blatantly untrue on every level. You can use almost any bank and they will convert it for you. Of course, they will take a fee, but that's much preferable than having to involve yourself with cryptocurrencies backed by cryptocurrencies backed by thin air. Tether is especially egregious with this, and I assume that's why you don't trust it - but from what I'm looking at, DAI is backed by USDC and ETH. MAYBE USDC is being honest with how much money they have, maybe they aren't, and ETH has some very obvious awful problems (e.g. the insane instability).

Overall, you haven't given me literally any reason to believe that holding the flavor-of-the-month stablecoin is in any way, shape, or form better than using actual US dollars.

[sepiasaucer]

In the absence of a stable government backed currency it seems cryptocurrency could have some value. However, cryptocurrency is also unstable. You are speculating that holding crypto will be better over some period of time than any alternative value store you can access. That may well be true, but seems like that depends on what other options you have access to and would require more rigorous analysis of the tradeoffs. For example, if you were to say “crypto is a better currency than eggs” [1], that seems likely, but eggs don’t require internet access and specialized knowledge of a particular technology.

[1] https://www.economist.com/finance-and-economics/2018/07/19/w...

[maxilevi]

You are assuming I use BTC or ETH directly as currency but I use stablecoins like DAI which are pegged to the USD dollar.

This allows me to hold currencies I wouldn't be able to buy because of capital controls by the government.

[sepiasaucer]

“Where does that fit in your categories?”

It sounds like it falls mostly under illegal transactions because you are using crypto for something that would otherwise be illegal (avoiding capital controls). Is it technically illegal? I don’t know. Is it ethically wrong? I guess not directly. However, I imagine there are also a lot of nefarious reasons somebody might want to avoid capital controls which crypto could also help facilitate.

[maxilevi]

It's illegal to buy dollars but not assets that track the USD dollar. Buying DAI is legal for the same reason buying USD denominated bonds is legal, they are not dollars and you are not taking them from the central bank.

And either way I don't think grouping "criminal transactions" with "stuff that's illegal in X country" is fair. At many points in history governments outlawed things that are very wrong (e.g. nazi germany) Just because someone doesn't want to succumb to corrupt institutions doesn't mean he/she is a bad guy.

[Illniyar]

Your government has capital controls (mentioned in a different response) to prevent you from purchasing foreign currency.

Which makes buying crypto (or stablecoin) illegal online purchase.

Illegal doesn't always means wrong or immoral, depends on whether the laws are good or not.

[maxilevi]

It's illegal to buy dollars.

I am buying an asset that is pegged to the USD dollar. That is not illegal neither is buying USD denominated bonds. In fact the goverment even has sold USD denominated bonds.