
Why Do Decent People Accept Bitcoins? - lmm
http://m50d.github.io/2014/03/06/why-do-decent-people-accept-bitcoins.html
======
ashray
Why do decent people accept bitcoins ?

Because they see value in it.

The whole article goes on to paint every single bitcoin user as a criminal of
some sort while completely ignoring the fact that the title itself is a
glaring contradiction of the content.

Furthermore, a lot of bitcoin criticism comes from very US centric viewpoints.
Consumer protection in the US (for the most part..) is miles ahead of many
other places in the world. You can return stuff after 30 days and in some
cases even after using things! On the flip side, my CC was fraudulently
charged by Greenpeace a few months ago in India and I would've had to jump
through some serious hoops (including cancelling my credit card) to lodge a
case to recover my money. Considering the amount was small, I decided to just
forget about it. But I still pay the 3% charge built into prices that are
'credit card friendly'.

Not sure if the article is just trolling because it seems heavy on the
criticism but quotes other critics as citations. (eg. Stross)

One thing I love about bitcoin is that a lot of folks seem to be very
passionate about it. There's some serious fanboyism and there are some serious
haters. Personally, I like bitcoin but I don't feel polarized by it the way
some people do. I can see why fanboys are excited about it but I fail to
understand why the haters are so against it. This is like Mac vs PC or
Nintendo vs Sega kind of stuff all over again.

I honestly want to hear from people who have actually been burnt by it. (MtGox
victims ?) Did they turn into haters ? Or what happened there ?

The only cases I know of MtGox victims (guys demonstrating outside the Gox
office in Japan) seemed to indicate that they clearly blamed Mark Karpeles/Gox
and not bitcoin in general. So why are the Gox victim sympathizers so keen to
blame bitcoin ?

~~~
collyw
When I say I don't trust bitcoin, I mean the whole infrastructure. No
government backing. I don't trust the system as a whole. I guess people
blaming bitcoin are taking a bit more generally than bitcoin itself.

~~~
collyw
Trying to answer the question asked and I get down-voted? Is it because I
admit I don't trust the bitcoin infrastructure and lack of government backing.

------
Permit
His argument essentially boils down to: "Don't make Bitcoins illegal, but
discourage use and shame those who accept them as payment".

So let's imagine a world where this happens. Most vendors shut down
operations, people dump their coins and the price of Bitcoin crashes and
stabilizes at some sub-dollar amount. Now, only criminals make use of Bitcoin.

Well, nothing has changed. Consumers of drugs purchase Bitcoins for use on
Silkroad-esque sites. Sellers accept Bitcoin payment for drugs and then sell
the coins back to other individuals wishing to purchase drugs.

The use of Bitcoin to facilitate illegal activities does not require mass
adoption. As long as there are enough people participating in illegal
activities to keep exchanges liquid, nothing will change.

In short, his solution accomplishes nothing. It doesn't reduce Bitcoin's
ability to facilitate illegal activities at all.

------
rjknight
_The one remaining business where cash makes sense is crime - to the extent
that most $100 bills contain detectable traces of cocaine._

I think there may be a different reason for the connection between $100 bills
and cocaine, which has nothing to do with how they are paid for.

 _There 's one - or two - more legitimate case for bitcoin I can see - and
strangely enough I don't see bitcoin advocates arguing for them: buying
embarrassing things online, or donating anonymously to causes you might not
want to admit your support for in public_

The main reason most people ever got to hear about Bitcoin in the first place
was that it was, for a while, the only way to donate money to Wikileaks, after
PayPal and the credit card companies cut them off. I know this was more than a
year ago and time moves faster on the internet, but has this been forgotten
already?

------
dutchbrit
Some counter arguments:

[1] The same goes for cash - well, in some cases it's even more trackable than
cash.

[2] I tend to find credit cards disgusting - people get in all kinds of debts
that they can't pay back. I prefer debit cards & don't own a CC. The only
advantage is guarantee's that credit card companies offer. But what tells you
a company can't introduce the same for Bitcoin?

[3] Isn't it kind of the same as a debit card? If you put your monthly
allowance, or weekly allowance in your pay wallet, what's the problem? If you
have a huge amount of bitcoins in 1 address that's made for paying people &
isn't in cold storage, you are doing it wrong. Same with regular cash.

[4] If you lose your wallet, you can still have a password on it. If you know
you've lost your wallet, find the backup at home of your wallet private keys
and move the bitcoins to a different address - that means that when you lose
your wallet, you don't automatically lose your cash...

[5] Exactly. You can debate if it's bad or good - but it does protect the
seller against chargebacks.

[7] That's great though right? Bitcoin wasn't designed for criminals only.
Sure, it has certain advantages for criminals. But it has a lot of other pros
too. International transactions take days compared to bitcoin transactions,
and are a hell of a lot cheaper too.

~~~
lmm
> The only advantage is guarantee's that credit card companies offer. But what
> tells you a company can't introduce the same for Bitcoin?

Unlikely in a system where transactions are irreversible by design. If a
credit card transaction is suspicious, the banks will hold the funds, or
refuse the transfer. The only way to have this work with bitcoin would be if
you paid the bank rather than paying the seller - in which case you're just
reproducing the existing credit card system with extra complexity.

> Isn't it kind of the same as a debit card? If you put your monthly
> allowance, or weekly allowance in your pay wallet, what's the problem? If
> you have a huge amount of bitcoins in 1 address that's made for paying
> people & isn't in cold storage, you are doing it wrong. Same with regular
> cash.

Sure; my point was that there's no advantage for bitcoin here, not that it's
any worse than the other options.

> Bitcoin wasn't designed for criminals only. Sure, it has certain advantages
> for criminals. But it has a lot of other pros too. International
> transactions take days compared to bitcoin transactions, and are a hell of a
> lot cheaper too.

That's the judgement we have to make. My view is that the advantages for
criminals are much bigger than the advantages for non-criminals, and so a
world with a thriving bitcoin economy is, on the whole, worse than a world
without one.

~~~
icebraining
What about the advantage of not having to trust _every single merchant_ to
properly secure the CC numbers?

You could say, "I don't care, I can issue a chargeback for fraudulent
transactions made with my card", but the $190 _billion_ per year that
merchants lose due to fraud doesn't come from thin air, it comes from your
pocket as higher prices.

I can understand not defending Bitcoin, but for the life of me I can't
understand people who defend a broken pull system like CCs, and right now
Bitcoin is the only push system working internationally that doesn't take days
and huge fees to transfer.

~~~
lmm
> the $190 billion per year that merchants lose due to fraud doesn't come from
> thin air, it comes from your pocket as higher prices.

And how much has been lost to fraud in the Bitcoin system? How do those
numbers compare as a proportion of transactions? CCs are not perfect, but the
costs of Bitcoin's irreversible transactions are bigger, and rather than
everyone paying a small percentage fee, Bitcoin fraud wipes out businesses and
even individuals.

------
dnautics
Why do charities accept bitcoins?

Because a deflationary economy means in the long term you don't have to worry
about inflation eroding the value of your accumulated donations which means
less participation in potentially morally questionable[0] endowment management
practices.

You could claim that accepting bitcoin facilitates an economy that has morally
questionable elements, too, but that is _also true for dollars_.

[0] for example, investing in stocks which are of companies that run counter
to the purpose of your organization, having investments in countries that
engage in political practices that are questionable (e.g. apartheid), or just
plain old subjecting your donor's funds to risk (which they may not want).

------
chjj
I still can't figure why people feel the need to have an all-or-nothing
opinion on cryptocurrency.

Stross' article says:

> Bitcoin comes with an implicit political agenda attached.

I disagree. Bitcoin was always supposed to be an experiment. Can we stop
inserting political and economic agenda into everything? Bitcoin has never
claimed to be the savior of mankind. It may succeed, it may fail. Can't people
stop speculating about it? And a lot of it isn't mere speculation: it's
extremely adamant positions on whether bitcoin will/should fail or flourish.

Why don't we just wait and see what happens instead of fabricating prophecies?
All of this is really tiring me out. I don't think I'm the only one.

------
hendzen
It's time for those of us who believe in the rule of law to put a stop to
this. I don't suggest making Tor illegal - enforcing such a ban would require
truly scary violations of liberty. But what we can do is establish a social
norm of treating Tor users like the criminals they are. Don't accept any HTTP
requests from known Tor exit nodes, and look twice at a website operator who
accepts them - if you can find a similar website that blocks Tor, use them
instead.

~~~
markmassie
Please tell me you're joking.

~~~
hendzen
I was making the point that this (IMO terrible) argument would also apply to
Tor, PGP, or any other technology that allows its users to
communicate/transact anonymously.

------
austinz
Large, private credit bureaux hold a significant amount of my most intimate
personal financial data, much of which is shared freely with banks but
grudgingly (at best) with me. Credit card numbers and other identifying data
are constantly being stolen, hacked, or leaked due to gross incompetence.
Machine learning algorithms are constantly going through my spending habits
for fraud protection purposes (and God knows what else).

I don't like Bitcoins and I don't own any, but even I can see why there might
be people reluctant to rush headlong into the glorious, corporate-mediated
digital future that the author claims is making cash obsolete. I cherish the
option to pay for things in cash. I understand why "upstanding citizens" might
cherish the option to carry out transactions using Bitcoins.

~~~
collyw
I don't really trust the banks 100% with my savings, but I trust bitcoin even
less. At least the banks have official government backing (another party I
don't trust 100%).

I guess if you trust bitcoin more than the combination of the other two it
makes sense.

~~~
ryanjshaw
You don't trust Bitcoin-based systems today, but will you tomorrow?

What fascinates me is the number of people who answer that question with a
definitive "NO!", some even going as far as this guy with a "NO AND YOU
SHOULDN'T TOO OR YOU'RE A CRIMINAL AND I'M GOING TO DO EVERYTHING I CAN TO
STOP YOU!"

Yet when you read their justification for their absolutist position, it's
always based on flaws in today's systems and services, or a naive tacit
assumption that every problem must be solved with an automated solution baked
into the protocol, or a strawman belief that just because some Bitcoin
supporters think it should replace cash that that is the only possibility
worth discusing.

Our present banking system - including regulatory oversight - did not develop
in 5 years, so why do people expect the decentralised cryptocurrency
environment to be any different?

I have no idea if Bitcoin-based systems will become a material part of our
civilization's future. Were I to guess, I think the technology is novel and
interesting enough that _something_ useful will come out of it.

But I really don't understand people who seem to claim it _definitely_ will or
won't 'go big' \- why don't they just sit back and see, or participate, and
phrase their beliefs more conservatively with a good dose of "I don't know but
I think ... because ..."?

What's with all the prophets running around?

~~~
collyw
Its not the technology as such I don't trust (I haven't read up on it enough
to say one way or another). Its the whole infrastructure surrounding it.

I don't trust bitcoin exchanges not to be hacked. Maybe the currency itself. I
don't trust there not to be bugs in the systems yet. Some governments are
trying to ban the use of it. Whats to say your government will not be next? If
it gets banned, I assume the value of any bitcoins you own will go down.

Mt .Gox just declared bankruptcy. If it was a normal currency, then you would
have some sort of guarantee (in the UK anyway) so that at least some of your
money is protected. Do the people that had bitcoins there have any of that
protection?

------
DavidSJ
Does the author not see the contradiction in complaining that a decent,
legitimate business would accept a currency which is purportedly only used for
crime?

~~~
ryanjshaw
Not to mention that if his rule is duly applied then Bitcoin _could_ never
become used for anything 'decent'. One of the most illogical anti-Bitcoin
arguments I've read in a long time.

------
JoeAltmaier
Op is an essay, which is a written passage seeking to make a point through
convincing prose. Its not a research paper, nor a documentary. Its emotional
pleas to think of things the author's way.

Its not very convincing, except to those already convinced. It compiles trite
phrases you can remember and regurgitate at a cocktail party or wherever (do
they even still have cocktail parties?) and sound smart. If you like to rant,
then here's plenty of material for you.

But reading it, as a person neutral to cryptocurrency, I'm unconvinced, even
slightly. The guy doesn't like bitcoin, I get that. But the arguments are so
tangential (its slower than cash in person? Until I get an app I guess) I
smell a rat: he's got nuthin.

If I wanted to criticize cryptocurrency with hard facts, I'd use this one: it
burns energy (and carbon credits) for imaginary points. I'd call it cynical -
burn the ecosphere because you don't trust anybody to be an issuing agent for
your currency. I've never heard that one promoted in an essay, and I'd like
to.

------
pyalot2
1) OP is an asshole

2) I accept bitcoin as payment for web development freelance services
(specifically WebGL/3D development). I do it because, I'm not troubled by the
exchange risk, and because the only way that people can pay otherwise is wire
transfers from their bank. These are costly, slow, and increasingly, they
fail. There's many reasons why they fail, but they basically boil down to that
banks suck. And don't even think that PayPal would be better. Conducting
business trough paypal is basically, much more risky than being exposed to
bitcoins volatility.

It's extremely refreshing to send out an invoice, and receive payment within
seconds, and have it securely confirmed, irreversibly within an hour.

------
jmnicolas
This is such a troll that I didn't read it 'till the end.

And I personally don't use Bitcoins nor do I intend to use them in the nearest
future.

------
anthracis417
>Companies hate doing business in cash, using it only when forced to.

This is pretty stupid.

~~~
arethuza
Companies pretty much do hate working with _physical_ cash - it is heavy,
difficult to secure, prone to theft etc.

This was the genius of offering "cashback" when doing a card transaction at
somewhere like a supermarket - it is a real win-win - the customer gets cash
they might need for something and the supermarket reduces the amount of cash
they have to deal with.

------
csandreasen
I think there are much better reasons for not wanting to see bitcoins become
ubiquitous. Bitcoins are not anonymous - they're pseudonymous. They're less
private than a VISA gift card because instead of only having to worry about
VISA seeing your transactions, now _everyone_ can see them. If bitcoins become
ubiquitous in the future, it won't be long before the addresses belonging to
businesses that accept bitcoin are publicly catalogued. You would be able to
see that this particular wallet went to the Starbucks on the corner, walked to
grocery store down the street and spent $100 in groceries, fills up their gas
tank at the gas station in the center of town once a week, etc. Once you buy
something from a vendor that wants your name/mailing address, they can then
tie your identity to your entire purchasing history for that wallet. Yeah, you
can change wallets, but what average consumer is actually going to do this? Do
you know anyone who carries multiple credit/debit cards expressly for the
purpose of maintaining anonymity?

I would think the average criminal would be smart enough to obfuscate their
tracks, but right now I think the only reason they use bitcoins is because
their lack of ubiquity allows them some degree of anonymity. If they had to do
their grocery shopping in bitcoin, they'd be doing their criminal activities
in something else.

------
dutchbrit
Consider reading this too:
[http://blog.coinbase.com/post/78558321110/coinbase-and-
overs...](http://blog.coinbase.com/post/78558321110/coinbase-and-overstock-
com-the-results-are-in)

Actually, accepting bitcoin right now will give you a huge advantage -
especially because your competitor probably doesn't and it's a pretty big
market.

------
dnautics
Why Do Decent People Accept Dollars?

"You can't ban dollars, you'd have to make governments illegal!" is the all-
too-frequent reply to anarchocapitalists who advocate for the separation of
state and economy. And it's true, more-or-less; while we can prosecute corrupt
politicians, there's little we can do to get rid of political structures that
are inherently problematic.

What I don't get, though, is why any upstanding citizen would want to help
them out.

Like any government-backed money instrument, dollars are created through a
system that starts with federalized debt; the usual economic cycle is that the
treasury issues a note (realistically an unbounded proposition in spite of
'debt ceilings), and exchanges them with a rich person or institutional
investor seeking a percentage return. This note is then exchanged with the
Federal Reserve bank, which in turn instructs the treasury to print up dollar
bills to satisfy this debt (with interest).

The one unique twist is that, being purely a political instrument, there is no
physical limit to this process and because overprinting money devalues savings
of the poor (and typically only bankers and the rich have impactful access to
the yield-bearing interest) the only thing limiting total economic collapse is
how effectively the government can hoodwink the populace into thinking that
spending is good for them - so the poor are thrown peanuts in terms of token
social programmes while other rich people like contractors and so forth (most
recently big pharma and healthcare sector) really get the mother lode in
spending (and bankers and fund managers make away with the interest)... But in
the united states, a full 50% or so percent goes to the "defense" department
and the "defense industry" (read: "war" department and "warmaking industry").

Dollars are, as Smedley Butler described, are, a currency designed to
facilitate the military industrial complex. When a guy walks into a place of
business and uses cash (or really any dollar-backed financial instrument, such
as a credit card or checks), ultimately, 50% of the debt that was used to
bring that dollar into existence went to finance a sprawling imperial
organization with thugs stationed in 180-odd countries around the world, has
invaded no less than two countries in the last decade and is responsible for
bullyish diplomatic (and sometimes underhanded) tactics for over a century.

And yet we celebrate when a business starts accepting dollars, a currency that
comes into existence supporting a questionable military. We create companies
whose mission is helping them trade this dirty money for clean. We ask
reputable sites to legitimize it by treating it as just one more money
transfer service, like accepting a new credit card type.

It's time for those of us who believe in peace to put a stop to this. I don't
suggest making dollars illegal - enforcing such a ban would require truly
scary violations of liberty. But what we can do is establish a social norm of
treating dollars like the warmongering tokens they are. Don't accept them in
payment, and look twice at a seller who accepts them - if you can find a
similar business that takes, say bitcoins, buy from them instead.

It won't stop dollars completely - an financial instrument that owes a full
50% of its existence to the US military industrial complex. But if decent
people don't accept dollars, it means these thugs and worse will have to
finance their morally questionable acts by asking us directly, which allows us
to at least have some moral oversight, cutting in to their warmaking ability.
And that, by the simple rules of democratic principles that supposedly the US
believes in, means that people will feel the cost of war by direct taxation,
and fewer politicians will choose to wage wars.

~~~
LispShmisp
It's interesting to look at wealth distribution of Bitcoin:
[http://imgur.com/Vt7PvbW](http://imgur.com/Vt7PvbW) (source:
[http://bitinfocharts.com/top-100-richest-bitcoin-
addresses.h...](http://bitinfocharts.com/top-100-richest-bitcoin-
addresses.html)). 4% of users own 95.09% of currently available Bitcoins. I
think that as the number of users increases so will value of Bitcoin in USD,
wealth distribution will only get worse while making top even richer. Even if
wealth distribution doesn’t bother you, consider that part of these users(4%)
mined/gathered it in questionable ways(mining via compromised systems). Early
adopters gaining large part of Bitcoin for little effort seems silly too. I
personally consider this unacceptable.

~~~
joveian
That might be the most important reason to dislike bitcoin right now. It is
obvious why people who have a public ledger that claims they have a bunch of
money would be fanatical about wanting other people to recognize that claimed
wealth but not at all obvious what is in it for others.

However, even if that is fixed (e.g. some other similar cryptocurrency without
that issue) I would add two more issues: 1) The system as a whole, for any
possible system similar to bitcoin, seems vulnerable to being disrupted by
anyone with enough money (at best this would still cost a fair amount of
money, but I'm fairly sure it would cost a lot less and be less recoverable
than trying to similarly disrupt (at least most) other currencies). 2) The
estimates I've seen suggest that a huge amount of power is going into
cryptocurrencies for no good reason. This seems like both a horrible response
to global warming and (per point 1) is making the same cryptographic mistake
that hashcash made on a much smaller scale. Hashcash seemed like a good idea
at the time, but I'm not sure why it seems like a good idea to anyone now.

I would love to see more work done on various ways to implement robust local
currencies rather than all this effort on trying to create fragile global
currencies that suck huge amounts of power. Last I looked there were a few
things available but it seems like a lot more can be done.

------
dutchbrit
Another pro of Bitcoins over traditional banking can be read here:
[http://www.thisismoney.co.uk/money/experts/article-2540445/W...](http://www.thisismoney.co.uk/money/experts/article-2540445/What-
maximum-money-I-withdraw-HSBC.html)

------
lotsofmangos
I'm not allowed to use these exciting things like credit cards with my bank
account after taking too long too pay off student debts many years ago.

I'm keeping an eye on bitcoin as it might finally let me spend money online
without first having to ask permission to do so.

------
freework
this article was written specifically to piss of bitcoiners

------
iterationx
Is there a phrase for when someone takes the "Moral High Ground" where there
is none to take?

