It's a technology for allowing money to bypass the rule of law. By design it concentrates power in the hands of property owners, and allows them to undercut democratic rules against activities with negative externalities - and since it's more expensive than currency, those are the only use cases that make sense; prime use cases would be things like drugs, smuggling, tax evasion, child porn, terrorism. I think IED control software is a pretty fair comparison actually, except that IEDs are somewhat more democratic.
It's not that it has no use case. It's that it has a very niche use case.
Government were never going to allow some unfettered parallel monetary system. Governments invested a lot of political capital to monitor and control monetary flows (from reasons/excuses like fraud, terrorist financing, money laundering). No way there were gonna relinquish that power.
They might use the technology itself as CBDC, but that is about it.
It was sold as new web 4.0 or whatever. NFTs were the future. Smart contracts.... And all it seemed to deliver were all mistakes and scams monetary system made in 19th century.
The only use, which is enough, is to subvert those who claim authority over others.
A specific example is committing crimes: buying or selling drugs, money laundering, tax evasion, etc.. but maybe its building a nest egg to help escape an abusive relationship or God knows what. Hiding money from some sort of extortion.
Most "crypto" isn't hidden, it isn't crypto. It's gimmicky marketing. Not currency either.
Fully fungible (all units equal) crypto (hidden) currency (means of exchange, store of value) is incredibly useful. Everyone understands why untraceable money that you can send cheaply, globally and securely in an instant is useful.
Monero, maybe not the best or final ideal tech, but it has real utility.
The ultimate use case is control and tracking beyond any form created thus far.
Paper currency that may be in your pocket has serial numbers printed on it. Those numbers cannot be readily associated with an individual. Bitcoin and all other blockchain systems can be connected to a user directly or through alternative methods. This is ideal for government and is the direction most are taking - control over blockchain systems and therefore control over the system's users.
Pointing to credit or debit cards is a poor comparison since those require significant hurdles for participation. Cryptocurrency requires only a smartphone or some kind of computer and a rudimentary internet connection. The infrastructure for the entire system is already in place, unlike growth of the early internet needing computers and modems. Transactions work now and have been for years; higher level functions such as decentralized exchanges, asset registration and such are gradually being tested and implemented.
Meanwhile, users are voluntarily joining. Government needs do little other than take some corrective actions and dictate rules for usage of cryptocurrency that can be enforced within borders. It's a control-freak's dream come true.
A lot of people have made the point that the vast majority of its value is for people who want to commit crimes, which is exactly the use case you described.
Crypto is useless outside black market, illegal activities. I can't find any use cases which money issued by gov can't cover but crypto can. Basically it's an re-invented wheel, like so many new programming languages which are interesting but not necessary.
You're completely missing the point raised though.
They said there are no real uses of this technology outside of speculation and laundering and your response is that tools for speculation and laundering are useful. That's not really what the argument is here.
The argument is that this technology is being touted as diverse and widely popular when it in fact is not and mostly only used in circular use cases involving itself.
That's a super niche application, not a mass market use.
And yes, I know about the supposed use for people in countries with unstable regimes but I'm not convinced at the moment. Plus that use case, being that of people generally having low disposable incomes (barring China) absolutely doesn't justify the market value of crypto at the moment.
Cryptocurrencies have a valid but very specific use-case: being able to transact in a hostile environment. It does so by making certain trade-offs such as an energy-intensive verification process.
This is a very valid use-case when you need to transact against the will of a powerful adversary such as governments. It needs to be there and needs to be protected just like free speech needs to be protected.
However, day-to-day, if you're making transactions that the government approves of, it's better and more convenient to rely on said government to protect you and end up using a much more efficient (in terms of transactions per second, fees & energy usage) and convenient system such as credit cards.
Crypto is like a tank - useful if you need to go into battle and defend yourself, and while it can be used to go buy groceries at the mall, it's not the most convenient. When you're not in battle, you're better off just using a normal car and relying on local laws and subsequent enforcement to deter anyone from harming you, which, at least in civilized countries, works the majority of the time.
In some sense, yes the ultimate purpose of a bearer currency in the era of government controlled custodial currencies is having a currency that the government can't seize from you or put prior restraint on you spending. Thus by definition, the main use case is "illicit".
But remember that "illicit" also includes sending donations to protestors in Canada when the government froze their bank accounts, or sending payments to dissident organizations that have been blacklisted and denied banking services, etc.
We can also say that the primary use case of signal is "illicit" communication -- that is, attempts to skirt eavesdropping by various government security organizations, and this is why Signal received funding from the U.S. government - it was a device to assist in coordinating anti-government protests in nations the US wanted to oppose. For the same reason, the U.S. Navy created and funded Tor.
So this is a two way street -- the ability to send payments and securely communicate even if your government doesn't want you to do that is great when they are used to support dissidents in nations you oppose, but not so great when they are used for similar purposes at home, or when they are used for organized crime. Just because a technology's primary use case is "Illicit" doesn't mean it's not a valuable or useful technology.
The only real use-case of crypto is value transfer that is immune to government interference - I don't think anyone is denying that.
But for the vast majority of businesses which interact with the real world, it doesn't matter whether the actual logic is on a bulletproof, uncensorable VM if the government can just go after the few input/output points where the system interacts with the real world.
Therefore, it's no better than just running SQLite and much worse because crypto makes significant tradeoffs (to be resistant to adversary interference) that aren't actually useful here.
Can you please name what these specific use cases/'legitimate things' are? I'd take literally 1 example. My experience (full disclosure of priors: I don't think they exist) is that crypto enthusiasts always vaguely reference them, and then when you look at it it's a tiny project used by virtually no one. I am unaware of any mass-market crypto product that's used by say millions of people, but you certainly prove me wrong by naming one or two.
As far as I can tell crypto is a place for speculation, ponzi schemes, and (to be fair) is a mild upgrade in the field of illegal payments. Other than that, there are no legitimate use cases 15 years after its invention. It's just a technological dead end with an unusual amount of hype
It 's been instrumental in illegal purchases online (drugs, weapons, counterfeit currency, etc), tax evasion, sanctions avoidance, and money laundering.
Some of these things, in some contexts, are both ethical and critically useful. Obviously there are also many (if not most) unethical use-cases.
...but you cannot claim it has no practical value.
That's cryptocurrency. There are some other applications of blockchain, usually centred around recording non-cryptocurrency transactions (transfer of ownership of diamonds being the best known example), or smart contracts for things like flood insurance where the activating event for the policy can be taken from a mutually trusted sourec. I think that most of them are inferior to traditional ways of reaching the objective, but they are not open to Ponzi schemes.
I think those are all basically the same use case - they're all about routing money of nontrivial value around governments. Much like Tor, it is not 100% unblockable, but it is quite difficult to block if you keep the internet flowing at all.
And like Tor, it can be used for both moral good and moral bad. (In fairness, you can decide that the good outweighs the bad for Tor but not for cryptocurrency; you can also believe that the good doesn't outweigh other harms like the computational/energy cost of running a secure blockchain, which necessarily needs a nontrivial fraction of the world's purchaseable computing power.)
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