[kragen]

pretty much the entire currency black market here in argentina used to run on cryptocurrencies, which is more significant than it sounds given how large a fraction of argentina's employment is illegal (something like a third, last i heard). i think us banks have taken some of that business away from cryptocurrencies in recent years, but every illegal moneychanger still accepts them even if most of their business runs over zelle

as for how countries might do better, while it is interesting to discuss what policies policymakers ought to adopt, argentine (and turkish, venezuelan, etc.) policymakers do not want to adopt the policies they ought to adopt; they want to adopt the policies that serve their political interests. the rest of us are left to figure out how to cope with their terrible policies. and that's the sense in which bitcoin matters; it makes it possible for argentines and venezuelans to do things like save money, leave the country, and send money to their families back home when they're working abroad

on a financial macro perspective, there's currently about 1.1 trillion dollars stored in bitcoin, which is a few days of global gdp. other cryptocurrencies together are something like half a trillion. it's entirely plausible that 80%, 90%, 95%, or 99% of bitcoin's number is owned by keys that were lost in disk drive failures back in the cpu mining epoch, but that's less likely for the other cryptocurrencies. so i don't know that i'd agree that they don't exist on a financial macro perspective. certainly they aren't anywhere near the importance of asset classes like real estate, commercial paper, forex, commodities futures, or stocks, and it's questionable how much real liquidity exists in the market—if satoshi were to start selling off his coins now, how much would it tank the market before he was done?

[gumby]

> on a financial macro perspective, there's currently about 1.1 trillion dollars stored in bitcoin, which is a few days of global gdp

You need to compare like to like. $2T of cryptocurrencies is about 2% of all the world’s stock exchanges (after the recent fall). Or compare it to total world fungible assets: https://www.visualcapitalist.com/all-of-the-worlds-money-and...

[kragen]

that seems like the right kind of comparison, yeah, although it's surprising the world's stock exchanges aren't worth more.† the infographic article is excellent, though i guess now cryptocurrencies would be more like 15 squares instead of three

2% is far from insignificant! argentina's gdp is less than 1% of the world's—as are each of switzerland, taiwan, belgium, israel, south africa, pakistan, new zealand, nigeria, greece, and hungary. if the advent of cryptocurrencies has added a new power to the world stage of the same order of magnitude as taiwan, pakistan, or nigeria, that's a momentous event—particularly since it's doing it by giving tens of millions of the world's poorest people relief from terrible governance

(funding universal public access to history's biggest library despite prohibitions from the world's greatest powers seems significant, too. you've been in india, you know what library access is like outside the rich world, and you're surely aware that sci-hub and libgen have had a huge positive impact even inside the rich world)

in the infographic, the m1 money supply is about four months of world gdp, 35 trillion dollars, and that seems like the most nearly equivalent thing in the list to compare bitcoin to. it's about 3%. if we assume that countries' money supply is close to proportional to their gdp, that would make bitcoin the 8th largest world currency, following the euro, the us dollar, the yuan, the yen, the indian rupee, the pound, and the brazilian real. it would beat the canadian dollar, the russian ruble, and the other 150 or so national currencies, going by https://en.wikipedia.org/wiki/List_of_countries_by_GDP_(nomi...

if we use the m2 money supply instead, bitcoin is about 1% of it and drops to about 15th

on the opposite end of the scale, supposedly there are two or three thousand billionaires in the world; bitcoin distribution is widely considered to be highly inequitable, and so it may have added a few dozen or a few hundred to that number. considering the historical impact of certain individual billionaires like andrew carnegie, george soros, john d. rockefeller, and leland stanford, that seems like it might also be important

______

† world gdp is 110 trillion dollars per year; if corporate profits are 10% of that, that'd be 11 trillion dollars per year of profits, and you'd expect share prices to average around 20 years of profits, which would be 220 trillion dollars, much higher than the 89.5 trillion dollars in the infographic. perhaps outside the usa corporate profits are much lower, or investing in the stock market is much riskier? it's certainly riskier here

[kragen]

an interesting additional data point is https://www.chainalysis.com/blog/bitcoin-market-data-exchang... — while i don't trust chainalysis in general i suspect that they are probably telling the truth when they say

> As of June 2020, roughly 18.6 million Bitcoin has been mined. (...) Another 20% hasn’t moved from its current set of addresses in five years or longer. We consider this lost Bitcoin.

which suggests that the amount of lost bitcoin is at most 20% rather than the 90% or 95% i was suggesting

also, in talking about its historical impacts, it seems like probably we really should mention ransomware and darknet markets for, mostly, illegal drugs