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How Governments Can Easily Kill Bitcoin odysee.com/@TraderUniversity:a/how-governments-can-easily-kill-bitcoin:8?r=8T2xqWjtafHWYGxQBSsrbw1wQPm7sWRq

1628 sats \ 52 comments \ @Undisciplined 9 Aug bitcoin

From Matthew Kratter's Bitcoin University

Video Description

In this video, I discuss two actions that governments could take that would permanently destroy Bitcoin:

Stop censoring money and freezing bank accounts
Stop over-spending and start living within their means

This two-prong attack could decimate demand for Bitcoin block space, thereby starving Bitcoin miners of transaction fee revenue.

As we see increasing government benevolence and competence spread across the globe, the risks of owning Bitcoin could skyrocket.

Fortunately, we will still have government-issued money like US dollars and Euros. In a scenario like this, this so-called "fiat money" could become an increasingly important store of value and medium of exchange over time.

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75 sats \ 15 replies \ @didiplaywell 9 Aug

This is true even today. The main reason bitcoin hasn't seen widespread adoption in the north hemisphere is because their currencies are still perceived as stable, and the only thing that dampens bitcoin adoption on 3rd world countries is the fact that said relative stability is rock-solid in comparison to the local currencies, so that much that they're perceived as a robust store of value, relegating bitcoin back to a niche.

However the reason bitcoin became more and more adopted here is not because of it's valuation virtue but because of it's freedom. Transacting USD, even if the USD is perceived as valuable in itself, is from difficult to impossible here. Using the standard banking system you will lose 50% of your money at an optimum best, due to regulations, and transactions can last weeks. Bitcoin and USDT broke all of those barriers, becoming desirable for that reason alone.

41 sats \ 11 replies \ @Undisciplined OP 9 Aug

I recall reading about people taking the ferry over to Uraguay in order to stock up on dollars.

41 sats \ 4 replies \ @didiplaywell 9 Aug

Exactly, and I know many who had to travel to the USA to be able to retrieve the money in person. Bitcoin and by far and large USDT allowed the proliferation of the freelacer industry here. It's insane to think that those technologies allowed (and allow) many of us to live decently, by all standards, amidst such a terrible crisis. That's the reason many of us hold to it for (literally) dear life. I hope bitcoin developers are proud to know they provided millions with a lifeline to actual work (not trading), gives me goosebumps to think about it.

20 sats \ 3 replies \ @Bell_curve 9 Aug

Hold on dear life or HODL

21 sats \ 2 replies \ @didiplaywell 9 Aug

Can't get more literal!

20 sats \ 1 reply \ @Bell_curve 10 Aug

Your story is remarkable. You should write a book!

21 sats \ 0 replies \ @didiplaywell 10 Aug

Thank you buddy, I appreciate that :)

I'm indeed slowly crafting a book around all of this in a similar style as Adam Smith did, and I'm planning to publish it on Nostr.

20 sats \ 5 replies \ @Satosora 10 Aug

People actually do that? Hold brings of dollars?

41 sats \ 4 replies \ @didiplaywell 10 Aug

As literal as you read it, it's not only a thing, it was by far the optimal alternative before USDT became more integrated. Travelling personally to another country to retrieve physical money and bringing in the stacks was the safest and most cost effective option by such a ridiculous margin that it was the go-to option.

10 sats \ 3 replies \ @Satosora 10 Aug

Wow, I am surprised people took that risk.

41 sats \ 2 replies \ @didiplaywell 10 Aug

The good thing is that for us the usefulness of crypto became so blatantly evident

0 sats \ 1 reply \ @Satosora 10 Aug

So people use USDT now? They dont bother getting stacks of cash?

21 sats \ 0 replies \ @didiplaywell 10 Aug

Not if they work for off-shore remote jobs, not anymore. Of course there are boomers who still need to have the physical bill in their hands, but the youth stays in crypto (either USDT or BTC or a mix of both). I personally like to keep my stack on BTC only, tough many keep it on USDT only.

People who earn in local currency, again mostly boomers, do keep their stack in phyisical USD only because it's really easy to get. But the youth use apps to buy USDT, tough most keep the money in local currency and use apps that provide yield in local currency.

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20 sats \ 2 replies \ @Bell_curve 9 Aug

Dollars are difficult to acquire in Argentina?

What about the underground or black market economy?

Interesting to hear about tether. Many people dismiss tether as ship coin. And they are very obnoxious and condescending. I say go to Argentina and say that to tether users.

21 sats \ 1 reply \ @didiplaywell 9 Aug

Dollars are fairly easy to get in the black market, it's so common that's even a safe operation. The problem is about getting it from off-shore transactions. You can do that via the black market too but it's cumbersome and costly. Prior to the appearance of USDT the best option by far was to travel to get the physical money in person, so insane the situation was. I can get the criticism USDT receives but here it became the golden standard, it's usefulness simply can't be overstated.

20 sats \ 0 replies \ @Bell_curve 10 Aug

Even in El Salvador dollar and USDT usage and adoption are higher than bitcoin

35 sats \ 1 reply \ @jasonb 9 Aug

I love how dead-pan he presents this. Kratter has the most charmingly droll sense of humor.

21 sats \ 0 replies \ @Undisciplined OP 9 Aug

Right? I went back and forth a few times on how serious he was.

61 sats \ 16 replies \ @grayruby 9 Aug

I don't think a sudden 180 on gov spending would magically erase the value of bitcoin. I mean people have witnessed what has happened the last 20 years and understand such a pivot would likely be short lived.

I also don't think the stopping of censorship and freezing bank accounts kills bitcoin. There is still centralization risk, institution insolvency risk, high fees, slow settlement that create friction for users in traditional banking.

While I don't think this two prong attack would kill bitcoin, it would likely diminish its perceived usefulness to a lot of normal folk.

81 sats \ 15 replies \ @Undisciplined OP 9 Aug

I think Professor Krattert was making his point tongue-in-cheek.

44 sats \ 14 replies \ @grayruby 9 Aug

Yes, I assumed that. I am just playing out the thought experiment.

71 sats \ 13 replies \ @Undisciplined OP 9 Aug

I had similar thoughts as you, while watching.

Part of the case he's making has to do with how long bitcoin goes between difficulty adjustments. Someone else was talking about this recently and I don't know enough to say whether they're right or wrong.

If demand plummeted and the vast majority of miners left suddenly, Bitcoin might stop being able to function well and it could take a very long time to get to the difficulty adjustment.

53 sats \ 11 replies \ @grayruby 9 Aug

You should check out Preston's podcast with Bob Burnett. He predicts over the coming years you will essentially have a futures market for blockspace the same you do for oil where companies can smooth out the variance in revenue.

Now if there was no demand for block space there would be no need or demand for this type of market but it was an interesting conversation and somewhat adjacent to what we are talking about, which is why I brought it up.

41 sats \ 0 replies \ @Undisciplined OP 9 Aug

Sounds interesting

20 sats \ 9 replies \ @Bell_curve 10 Aug

A futures market for hash rate

There are a few markets for buying hash rate like nice hash.

I even won a BCH block!

21 sats \ 8 replies \ @grayruby 10 Aug

6.25 or 3.125?

50 sats \ 7 replies \ @Bell_curve 10 Aug

Lower

I forget the exact number. I received a fraction of what the entire mining team received. I purchased 12 dollars worth of hash rate. My reward was 50 dollars.

I can double check the exact amount in my nice hash account

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50 sats \ 0 replies \ @Bell_curve 10 Aug

Most miners leave temporarily. If most left permanently new miners would enter or existing miners would increase their hashrate

Too many miners have made large capital investments

38 sats \ 0 replies \ @Bell_curve 9 Aug

I like his sarcasm

Increasing government benevolence and competence

36 sats \ 0 replies \ @Satosora 9 Aug

Its like going to mcdonalds for a salad. Aint gunna happen.

61 sats \ 1 reply \ @SimpleStacker 9 Aug

It feels a bit like saying, "How drug addicts can get clean: 1. Stop taking drugs. 2. Start living healthy."

32 sats \ 0 replies \ @Undisciplined OP 9 Aug

It would be a bit more like "How to destroy the rehab industry: 1. Stop taking drugs. 2. Start living healthy."

29 sats \ 0 replies \ @LOSTandUNFOUNDS 9 Aug

We all go to the same school! First year student here!

He reminds me of Gordon Ramsey when he’s evaluating.

I’m sad…

Pan to panicked chef…

I’m sad because, I sat through all these dishes just to end up here with this…

Quick pan to the rest of the judges panel And even more anxious chef.

Masterpiece. Well done.

46 sats \ 2 replies \ @Cje95 9 Aug

According to Andrew Sorkin they just gotta unplug the data centers… up there with Rep. Brad Sherman’s comment of we should just flip it off like a light switch comment….

21 sats \ 0 replies \ @Undisciplined OP 9 Aug

I knew they shouldn't have put that on/off switch on it.

0 sats \ 0 replies \ @Bell_curve 10 Aug

Brad Sherman is truly clueless.

His district is in Los Angeles

45 sats \ 1 reply \ @ChrisS 9 Aug

Not only would the govt have to do these two things we would also have to have a guarantee they wouldn’t start doing it again. So in opinion even if they stopped spending so much, just the fact that with the current system they can is enough for me not to want to store my wealth in fiat.

32 sats \ 0 replies \ @Undisciplined OP 9 Aug

That's right. The video is making this point in a somewhat facetious manner. The only "threat" to Bitcoin is for the state to stop acting like a state.

26 sats \ 0 replies \ @Coinosphere 9 Aug

Goddammit, we're screwed...

41 sats \ 1 reply \ @freetx 9 Aug

Yes, if Volcker 2.0 arrived and raised rates to 18% (like they did in 1980s) combined with doing away with all "war on cash / kyc" policies it would destroy Bitcoin.

This is the point that I used to always make to friends who would say: "Won't the govt try to ban bitcoin" and I would say, "They already have the power to destroy bitcoin, it just requires them to live within a strict budget and not print money for their wall-street friends".

Given the fact they consistently do the opposite we can only assume they not only want Bitcoin to exist, but to flourish.

42 sats \ 0 replies \ @Undisciplined OP 9 Aug

You'd need more than Volcker 2.0, because the rest of the world is even worse on many of these things, so you'd need at least half a dozen Volcker's plus ending those policies everywhere.

23 sats \ 0 replies \ @iam_jerry 9 Aug

Don't be naive to think that governments and central banks will ever stop printing more and more of their currencies, including the U.S. I believe prof. Krater is making a sarcastic statement there. Think about it, how much of its purchasing power has the U.S. dollar lost so far? What about the U.S. debt? Will they ever stop the printers? I don't think so. Their source of power lies in the printers. And they need to keep printing in order to keep the coarcion alive.

0 sats \ 0 replies \ @eduardopro 9 Aug

Hilarious concept, LOL.

0 sats \ 0 replies \ @Satoshi__Nakamoto 9 Aug

Government can but it not pratica

0 sats \ 0 replies \ @160ed04091 10 Aug

Governments could implement high taxes on Bitcoin transactions or holdings, discouraging people from using the currency just like in some African country like Nigeria