The whole interview is worth a watch if you're interested in his perspective on the global economy. What Dalio actually said was in the long run he wouldn't be surprised if the US Government eventuallyattempt to ban Bitcoin, and he made the historical comparison to gold (which he favours).
For those that don't know their history[1]: "in 1933, Executive Order 6102 had made it a criminal offense for U.S. citizens to own or trade gold anywhere in the world, with exceptions for some jewelry and collector's coins.". These restrictions lasted for 30 years
I actually tend to agree with him. Bitcoin blows a gaping hole in any capital controls any government could ever want to impose, and its one available to ordinary plebs with an Internet connection.
The reality is though, only 3% of the ~32 million funded wallets in existence actually transact every day[2], and only 7 million wallets globally have more than $1,000 USD worth in them[3]. Bitcoin isn't really a threat to anything yet.
The gold ban was more nuanced and therefore not really a parallel to bitcoin.
First, the government forced people to sell gold to government and forbade hoarding it.
Bitcoin market cap today is $1 trillion. It would cost US government a pretty penny to re-purchase BTC owned by US citizens. That's today. Within a year market cap could be $2 trillion.
What if they just ban it without purchasing current Bitcoin? Even a two bit lawyer would immediately sue such law as unconstitutional. To me it's clearly "unreasonable seizure" under "unreasonable search and seizure" clause.
You think taking guns away is hard? Try taking hundrends of billions of dollars from tens of thousands of Americans.
Second, apparently the reason they did is: FED wanted to print money but they had a stupid rule of pegging us dollar to gold so to print more money they needed more gold.
This doesn't apply to Bitcoin (and I'm guessing the rule is long gone).
So in my opinion outright banning of Bitcon by U.S. Government would be unconstitutional and buying it out is already too expensive to be politically viable. Imagine a bill that would set hundreds of billions of dollars on fire.
The US government could make transacting with, or trading in, Bitcoin anywhere in the world illegal for US citizens and then offer $75,000/coin domestic redemption exclusively for those citizens. Offering a premium like this is exactly what the US did with Gold in 1934.
To prevent inflows from outside of its borders it could simply require that anyone redeeming prove that they are 1) a US citizen, 2) purchased the coins prior to a certain date and 3) did so with their own capital/earnings.
Sure the Fed would have to print a lot of dollars, but the Gov could then sell any coins it reaped in foreign markets, crashing the price overseas and only losing the premium they paid. The crashing price would drive further domestic redemption.
The market cap may be $1T but the trading volumes are tiny ($80bn/day peak), so the US could easily take it down with a concerted effort, particularly if other major nations (like the EU) were also in the game.
You're naive if you think the US and the EU simultaneously banning Bitcoin (and other decentralized cryptocurrency) wouldn't render it an interesting historical footnote. It's a speculative asset that doesn't have enough real world utility for anyone to go to war over.
>Bitcoin market cap today is $1 trillion. It would cost US government a pretty penny to re-purchase BTC owned by US citizens. That's today. Within a year market cap could be $2 trillion.
I don't see how you'd argue that the government has to pay the imaginary value that bitcoin fans ascribe to their currency. If the government removes or adds laws, it can create or destroy business models and tank stock and commodity prices. As of right now, BTC are just securetized CO2-waste. If the price drops after the US bans it for environmental damage, well it's the market. You are free to transact BTC in the rest of the world after all.
> The reality is though, only 3% of the ~32 million funded wallets in existence actually transact every day[2], and only 7 million wallets globally have more than $1,000 USD worth in them[3]. Bitcoin isn't really a threat to anything yet.
That doesn't include transactions within wallets (ie: coinbase), regulated market transactions (GBTC/OBTC), lightening network, other crypto currencies.
Bitcoin is a $1 trillion market cap store of wealth (though an estimate 20% of that is probably lost), it's really huge. Its economy now is larger than some countries, and only a couple countries (China/USA) could probably fully sabotage it today.
If France wanted to "shutdown" bitcoin, they'd probably fail and the most that comes out of it is a minimal price depreciation. In the future, only a coordinate global effort will be able to shutdown the network.
> Bitcoin is a $1 trillion market cap store of wealth
$1T market cap doesn't mean $1T of value is 'stored'. I can create a unique piece of art and offer to sell you a 0.000005% share for $50,000. You might even be silly enough to buy it. Congrats, the market cap of my doodle is now $1T. So I guess I now have $1T of value stored? No.
Companies with billion dollar market caps can go bust and go to zero. There's no "store of value" implied by a particular market cap, because those valuations are based on forward-looking discounted future earnings, taking in to account future outlook (earnings growth) and market sentiment (premiums and discounts).
While Bitcoin and gold share some properties on the supply side, where they differ is that gold has very predictable demand which gives relative price stability. Half is used for jewelry and ~10% is used in industry. It's the price stability that people are referring to when they say gold is a "store of value".
Only ~330,000 Bitcoin have been created in the last 6 months. Even at currently prices (~$50K) that's only $16.5bn of new 'storage'. Everything else generated throughout the 6x increase in market price in that time is speculative. If significant outflows start, that $1T can evaporate very quickly.
If you buy or hold Bitcoin today you have to decide whether it actually has $1T worth of net benefit to society.
Bitcoin won't get banned because an increasing number of local governments find it useful. This movement will resemble marijuana legalization if the federal government ignores what the people want.
BTW, Texas governor just stated he fully supports Bitcoin adoption.
If you're really concerned about any of that, we should start by banning video games. Then Netflix and YouTube.
All those GPUs wasted on rendering Cyberpunk 2077!
All this energy wasted playing Minecraft!
Come to think of it, you should stop reading and commenting on HN. Every minute you unnecessarily keep you laptop powered uses energy and destroys the environment. Do your part to prevent the tragedy, I beg of you!
It's absolutely hilarious to see these arguments made on HN, I don't actually hold much faith in online discourse and clearly the propaganda (by the BBC et al) has _really_ worked.
Yet what about the websites that load over 10MB of JS/other tracking scripts? Globally it probably uses more energy than entire continents! Or at the very least uses 5-10% of battery life that could otherwise be saved.
Let's start by banning > 1MB of tracking related JS/adverts which do far, far, far more damage than Bitcoin.
Sauce: Use a simple web browser on mobile, one with adblock/tracking block and one without, see how fast the device with no adblock reaches 0%, I bet it doesn't take much time at all on the really heavy JS pages.
Depends on the digital stuff. BTC in particular is incredibly traceable. Tax on conversion to fiat if source of BTC is a country that doesn't tax carbon. Any sensible anti money laundering system should be tracking all the relevant information anyway.
The environmental impact argument to me seems like more of the same: China wastes energy and pollutes on a massive scale and western countries are the ones getting a stern talking to. Give me a break, it’s a convenient argument, but at the end of the day Bitcoin is a way for regular citizens to (mostly) keep the government’s hands off their wealth.
> Bitcoin is a way for regular citizens to (mostly) keep the government’s hands off their wealth.
What is the evidence for the "regular citizens" claim? Is there data on which social groups are over-/underrepresented in Bitcoin holding compared to non-Bitcoin wealth holding? My guess is that groups low in regular wealth/income are disproportionally low in Bitcoin wealth.
Government activities such as defense, education and infrastructure will still need funding. If some resource A shifts to Bitcoin and, assuming for argument, thereby becomes non-taxable won't some other non-Bitcoin resource B be taxed instead, with no net "hands off" effect?
bitcoin can still work on PoS, we should stop thinking it as a single, unmovable, un-updatable thing.
A switch to PoS like ETH2 is not going to make it lose value, decentralization and might even be an opportunity to go beyond the ridiculous 4-7 transactions/sec limit.
Going beyond the 4-7 transaction/sec would make so that exchanges stop asking you to give up control of the money, thus making it even more decentralized.
I see only positive benefits in switching to Pos. Lose nothing, gain everything
The original interview is here, and the Bitcoin segment starts at 14:30:
https://www.youtube.com/watch?v=cJ82qABNWQA
The whole interview is worth a watch if you're interested in his perspective on the global economy. What Dalio actually said was in the long run he wouldn't be surprised if the US Government eventually attempt to ban Bitcoin, and he made the historical comparison to gold (which he favours).
For those that don't know their history[1]: "in 1933, Executive Order 6102 had made it a criminal offense for U.S. citizens to own or trade gold anywhere in the world, with exceptions for some jewelry and collector's coins.". These restrictions lasted for 30 years
I actually tend to agree with him. Bitcoin blows a gaping hole in any capital controls any government could ever want to impose, and its one available to ordinary plebs with an Internet connection.
The reality is though, only 3% of the ~32 million funded wallets in existence actually transact every day[2], and only 7 million wallets globally have more than $1,000 USD worth in them[3]. Bitcoin isn't really a threat to anything yet.
[0] https://finance.yahoo.com/news/india-proposes-ban-bitcoin-us...
[1] https://en.wikipedia.org/wiki/Gold_Reserve_Act
[2] https://www.bitcoinmarketjournal.com/how-many-people-use-bit...
[3] https://bitinfocharts.com/top-100-richest-bitcoin-addresses....