tag:blogger.com,1999:blog-6704573462403312459.post1882864319169097846..comments2024-03-29T02:53:03.321-04:00Comments on Moneyness: From unknown wallet to unknown walletJP Koninghttp://www.blogger.com/profile/02559687323828006535noreply@blogger.comBlogger7125tag:blogger.com,1999:blog-6704573462403312459.post-76061444564722009292019-12-06T11:49:20.982-05:002019-12-06T11:49:20.982-05:00Wow, quite the reply. Thanks Chase.
"... but...Wow, quite the reply. Thanks Chase.<br /><br />"... but it made me wonder why you think the most likely option will be a ban? Is it because of its simplicity?"<br /><br />Yes, the simplicity. It's very difficult to put a ceiling on anonymous money. People will just get around the ceiling by opening multiple accounts. <br /><br />The same criticism can be levelled at prepaid cards, of course. If the ceiling on prepaid anonymity is $500, then with three cards someone can reach $1500. This is somewhat mitigated by the fact that cards can only be used where retailers accept Visa/Mastercard, and not in p2p transactions. This limits their usability. Also, regulators can simply tell stores (or the card networks) to disallow the usage of multiple gift cards to make one transaction.JP Koninghttps://www.blogger.com/profile/02559687323828006535noreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-77125946171133413232019-12-04T14:48:46.698-05:002019-12-04T14:48:46.698-05:00Option 3 is the in between option. I see the power...Option 3 is the in between option. I see the power of those within the pseudonymous money market to be strongly against this option as it slows down their current market. The competitors would likely be in favor of this option in comparison with some of the other options. This would allow competitors like Citibank to utilize online pseudonymous money market options without losing a large share of their overall banking market or financial data market. Given their current resources, they would likely compete within this market with ease. Regulators would also likely be in favor of this option as it limits the laundering that they see and leaves less need for future litigation. We would likely still see laundering as we do with prepaid cards, but it would require more energy and resources to do so, thus it would be less likely to occur. Yet, the fact that the ceiling is a similar law as the current law on prepaid debit cards, it means that there would not be a need to adapt the current law on prepaid debit cards (thus less pushback from those powers), creating an incentive to option 2 for its future ease. Lastly, citizens would likely be in favor of this option as well. It would be new to them, thus they would have distrust for change, but the small scale of it will not worry them severely. On top of that, if more professional competitors, such as Citibank, enter the market it would likely just be seen as a new way to transfer money and not so much as a sketchy online money scheme. All the while, those citizens who believe in freedom of choice and privacy would likely favor it to an extent as it is at least a compromise to the options available. Thus option 3 presents us with nobody strongly against with the most strongly opposed power being a weaker one in that of those already in the market/those looking to enter the market. The strongest of the powers, regulators and citizens, would likely advocate for option 3 as it provides them ease, transition, and freedoms while limiting the current state of laundering and corruption. <br /><br />Looking at it this way makes me believe that the option you present about creating a ceiling system and similar regulation to those currently on prepaid debit cards is the most likely option to occur in the future.Of course it still leaves room for laundering and corruption, but what does not? This is obviously not a scientific approach and there is massive room for error when simply guessing the motives of the powers involved, but it made me wonder why you think the most likely option will be a ban? Is it because of its simplicity?<br /><br />--Thank you<br />Chase Piercehttps://www.blogger.com/profile/02681723024768949194noreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-5609270039398940552019-12-04T14:48:22.542-05:002019-12-04T14:48:22.542-05:00Next let's look at option 2. It seems as thoug...Next let's look at option 2. It seems as though this would be the optimal option for eliminating as much laundering as possible, but it is the least desired option by those utilizing the market or hoping to utilize the market. Thus those involved in this market or looking to enter this market would strongly oppose this option. Competitors to the pseudonymous money market would likely be in favor of option 2. Although you spoke about Citibank having the option to enter this market, they would likely see it as less risky to take full advantage of their already dominant resources by increasing the value of financial data (outlawing a lack of data would likely grow the market of bankable individuals and the market for financial data). The power of regulators would favor option 2 as well as it would limit laundering more than any other option. Yet, there is an issue with this, as you again run into the problem of equality since prepaid debit cards would still be allowed as pseudonymous money. Regulators could then decide whether to outlaw these forms of pseudonymous money or to create a more complex regulation that would allow these but outlaw the stablecoins or similar options. This creation of a more complex regulation would likely lead to loopholes in the future and ways that another stablecoin like product would emerge within the regulation standards. Therefore, although regulators would be in favor of option 1, this factor of legal complexities in regard to the current standards on prepaid cards would likely lower the incentive of regulators for this option. Utilizing a similar 4 option school of thought for citizens not involved in pseudonymous money, I would assume the majority of opinion would be in favor of this option as it limits laundering and does not change the current banking system from their perspective. Yet, the further litigations in regards to prepaid cards could throw a curveball in this, as we would have to assess the powers in regard to prepaid card legality as a completely separate topic. Therefore option 2 leaves us with a strong incentive against option 2 from a weaker power of those involved in the pseudonymous money market. It also leaves us with a strong incentive in favor of option 2 from the competitors, regulators, and citizens. The caveat to those in favor of this decision is how the regulators react to prepaid debit cards, which could completely change the incentives of regulators, competitors, and the citizens.<br />Chase Piercehttps://www.blogger.com/profile/02681723024768949194noreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-85936890973977438922019-12-04T14:47:29.857-05:002019-12-04T14:47:29.857-05:00Reading this, I am curious about the powers in pla...Reading this, I am curious about the powers in play and their incentives for each of your options that are explained. I see three possibilities about the future of pseudonymous moneys described in your article. I see 4 powers at play all option: Those currently in the pseudonymous moneys market, competitors to those in the pseudonymous money market, regulators, and citizens not involved in the pseudonymous money market. <br /><br />Option 1: Regulators continue to allow pseudonymous money online.<br />Option 2: A complete ban of pseudonymous moneys.<br />Option 3: A ceiling for online pseudonymous moneys.<br /><br />Looking at option 1, it seems this would be the optimal option for individuals utilizing this market and/or hoping to utilize this market. Therefore, the current organizations and individuals currently utilizing this market would have an incentive to promote option 1. This power being in favor of option 1 furthers the likelihood it is chosen. You also mention Citibank because it is likely if option 1 were chosen, that they would also want to get into this market and that this market could potentially save them money in the sense that they could reduce a lot of the compliance work they currently pay for. Yet, with the value growth of data as a commodity, it is likely that current competitors to the pseudonymous money market players such as Citibank would not desire option 1. Option 1 would mean that their value of financial data would decrease, even more so if they joined the pseudonymous money market. Thus it is possible that the competitors would lose if option 1 is chosen even if the competitors later joined the market. Saying that, further research would need to be done to determine if the value gained from joining this market and cutting compliance resources would outweigh the value of financial data gathered from the current market. Saying that, for now we could consider the power of the competitors to those in the pseudonymous money market to be a wash. Option 1 seems to be the least optimal option in the eyes of regulators. This option would likely lead to the most laundering/corruption out of the 3 options and this option does not fall in line with their desire to have technological unbiasedness. Thus from the perspective of the regulators the incentive would be to stop/regress option 1. As far as the citizens not involved in the pseudonymous money market, we would likely see four schools of thought. Some people would likely not care about the dilemma at all. Others would likely believe most that people have a right to financial privacy and freedom of choice. Others would likely believe most that it is sketchy and would prefer all laundering stopped. The last school of thought would likely oppose option 1 in fear of change. Based on no scientific evidence, and purely on personal speculation of people, I would guess that the majority of the citizens would fall into the school of thought of opposing option 1. For the reasons stated above, I think option 1 is an unlikely scenario as there is only one power that is for certain in favor of option 1 and in my opinion, it is the least strong power of them all: those already in the pseudonymous money market and those looking to enter the pseudonymous money market. I believe regulators power and citizens power is the strongest of the powers I mentioned, both of which would likely oppose option 1, barring further findings. On top of that, competitors which I find to be of equal power as those in the market (for discussion sake) would also oppose option 1, furthering the unlikeliness of this option.Chase Piercehttps://www.blogger.com/profile/02681723024768949194noreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-81284042260997879802019-11-24T16:10:31.108-05:002019-11-24T16:10:31.108-05:00This is about stablecoins where regulators can pos...This is about stablecoins where regulators can possibly impose rules but what about privacy coins like Monero where even the blockchain won't reveal anything and there is no central operator to regulate? Even if these get banned from exchanges, there is nothing to stop such coins operating on peer to peer exchanges or offshore / darknet exchanges. Marcusnoreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-80785441336784989482019-11-22T12:58:11.686-05:002019-11-22T12:58:11.686-05:00I am going to guess that either MakerDAO has to re...I am going to guess that either MakerDAO has to register with FinCEN and do AML, or it will be obligated to ensure the CDPs that use it are registered and in compliance.JP Koninghttps://www.blogger.com/profile/02559687323828006535noreply@blogger.comtag:blogger.com,1999:blog-6704573462403312459.post-79551745051225327452019-11-19T22:27:39.857-05:002019-11-19T22:27:39.857-05:00How much of this applies to a decentralized stable...How much of this applies to a decentralized stablecoin (e.g. MakerDAO's DAI)?Anonymousnoreply@blogger.com