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Anti-bitcoin-because-environment people, I hear you. I even identify with you.

But, I'm curious.

What *should* be the future of ?

@celia
I am hoping for future without a concept of money.

@jalcine @celia Pretty much this. It’ll look mostly the same as it always has, until it starts vanishing.

@celia I’m an anti-bitcoin-because-environment-but-also-it’s-a-terrible-currency person, so I hope that qualifies. :-) The future of money will look mostly like the past and present of money, and that’s fine. Bitcoin, at best, solves a super-niche problem at tremendous cost.

@celia I found this book very useful in having a better understanding of money creation and its purpose - https://www.versobooks.com/books/2706-the-production-of-money

Among the take-outs, the fact that money (and how you create them) can and should be part of broader political agenda. Hence, for example, the (problematic and relatively recent) myth that central banks should be "independent".

Lots of takes on crypto don't make much sense in this context. A global currency, or a currency with fixed rules, doesn't really fit into this line of thinking.

If we think about transfers instead of creation, eventually, the actual way in which money transfers are recorded (be it in databases managed by banks, or ledgers), is not that important. It may have some relevance in the case of increased transparency requirements, or to contrast money laundering, but the technical way this is implemented is ultimately a technical matter of relatively little importance.

@g @celia what do you mean when you say that there is a recent myth that the central bank should be independent? In the US, the independence of the fed from the (political) treasury was established over 100 years ago. Are you suggesting that central banking should be politicized?

It has been tried. It's not great.

@mwt @celia I say "relatively recent" because, well, it is.

Interest rates, for example, were set by governments until the 1970s in much of Western Europe (or 1990s in England).

See for examples this paper from the European Central Bank published in October 2020, which is of course in favour of the independence of central banks, but has been produced for the very reason that there is a debate about it, and the consensus about is not so solid as may appear from the official routine declarations. https://www.ecb.europa.eu/pub/pdf/scpops/ecb.op248~28bebb193a.en.pdf

As that report shows, central bank independence is not a question or either yes or no, but of degrees.

I said it's a "myth", because I think we should have an open (and yes, political) conversations about the production of money and central banks, and the relatively recent conventional wisdom about the importance of having "independent" central banks should be questioned.

@g @celia Thank you, I did not know England was so late.

Independence of the central bank doesn't mean that it's not part of the government. Central banks are (with few exceptions) part of the government.

Independence usually just means that the legislature can't vote to print money or lower the interest rate for (short term) political convenience. Such actions have to be judged to be in the public's long term interest by a council of appointed experts.

@mwt @celia right, yes, thanks. I appreciate it's a nuanced conversation!

And also a technically complex one, where prevalent practices are often not aligned with stereotyped understandings of how things work, e.g. how much broad money is actually created by private banks vs by central authorities, or how quantitative easing works.

I think some more politically defined conditionality on such processes may not be bad, if done right (obviously, not easy!)
@celia Also, we had some debate a couple of days ago about the merits of "proof of stake" crypto compared to proof of work here: https://fed.giorgiocomai.eu/notice/A44ImFqbEKR1SfMaoq

I still think bitcoin should be outlawed on ecological grounds (different provisions targeted at mining and exchange in just a few countries can broadly achieve this goal). As for proof-of-stake, "because-environment" is not the point anymore. It's technologically interesting, and may have some use-cases, but still not sure about its pratical use. Many uses possible, not sure "money" is a key part of it.

@celia Currencies that are only valid into local communities (scale of a city or a region) and that you can only use for local services like local shops, local freelancers, local tourisme…

To get this currency, you either buy it with another currency, either receive it as a trade for your service.

I’m not a specialist at all, so Wikipedia is probably a good entry gate for that: en.wikipedia.org/wiki/Local_cu

@meduz @celia My country is keen on LETSing: en.wikipedia.org/wiki/Local_ex.

Since the optimal size of a community is 150 members (Dunbar's number), LETSing is a great fit; it encourages cohesion.

My own guess for the future of money would be the system we have now, but where financial criminals actually go to jail instead of paying fines which means nothing to them.

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@meduz @celia
However, there should be a way for people to receive money without the risk of being deplatformed. And I don't mean arms traders or human traffickers, but merely people with an unpopular opinion.

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@celia cash tbh. And cash bought digital equivalents (like gift cards but more universal)

@celia bitcoin already is the future of a monetary system. Other parts might simply be implemented on top. is it possible somebody comes up with something better? It just hasn't happened yet.

@celia Something like #Gridcoin which performs societally useful computations, for research, medicine, etc.

There are other blockchains that are more environment friendly.

@celia digital currency that can be exchanged for physical currency has been around for a while. The only benefit of crypto currency is decentralization.

Yet currency has immense gains from centralization. Without it, you can't provide stimulus or prevent fraud.

Technological advancement isn't about replacing established systems with new ones. It's about making things better.

@celia So, in its entire history, bitcoin has peaked at not even 500k transactions per daya. Even if that was sustained (which it wasn't) then it would be at 140 million transactions per year. The federal reserve reports 15,584 million transactions per year for 2019[b] (and that's only clearinghouse transactions, the real number is likely far higher). So, bitcoin has <0.8% of the yearly transactions that the global banking system has.

Now, bitcoin uses 77.78TWhc of energy yearly as a conservative, years-outdated estimate. The global banking system uses an estimated 100TWhd of power yearly. So, for well under 1% of the transactions bitcoin uses 78% (more like 121%e) of the energy the banking system uses. Is that really efficient in the slightest?

@celia Also, from a pragmatic perspective, bitcoin's transaction fees haven't gone below US$1.50 once in the past 6 monthsa, and hasn't gone below $2.50 in the past 3 months, not practical for small transactions at all.

@celia, I think Stellar has a good shot. It’s idea is that you can create tokens that represent something, like dollar, stock shares, or even beers. These different token types can be exchanged, but the trick is that it can happen automatically, and not necessarily directly. There is a native token called Lumens that pay for the (very low) transaction fees, and can also function as an exchange medium if needed.

@celia, of course anyone can create tokens, so there is an issue of trust. But Stellar built that in: you decide whose tokens you accept and it’s prudent to only accept national currencies from legit banks. But you don’t care what other people accept as payment, you can just send funds to them.

@celia

> What *should* be the future of #money?

I'm quite good at disposing of it and I'm always willing to give a hand.

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