Cannot understand why not cryptos for eBooks

...I mean as a general phenomenon.

It seems to me that once again, all these platforms like Smashwords and the like are just flooding everything and crowding it all with 'action' for PayPal and basically, well, just the ordinary old school banks, such as they were. And the 'trick' there has always been to flood the 'marketplace' to give no one in the actual operating market any market power and just extract fees.

Well I'll give you all one (more) confident prediction: the days of those types of platforms and the practice of 'fees instead of product,' as a business model, are over.

A few possible factors.

Cryptocurrency is energy-intensive. Last I saw, cryptocurrency mining accounted for about 0.5% of the world's total electricity usage. For people who believe that energy consumption and CO2 emissions are a major problem (which includes Mark Coker of Smashwords), that makes crypto an ecological menace.

Crypto is highly volatile. In less than two months between December and February lost almost two-thirds of its value against the US dollar. That creates major business risks - the value of your income stream can fluctuate massively. Imagine somebody pays you $10k in BTC, your tax is assessed based on that $10k, and then the value of your BTC drops before you've actually converted it to dollars to pay off the tax liability? Of course, it can also work in the other direction, but not everybody wants to be a professional gambler.

Crypto attracts some unsavoury types. Crypto + online purchase of intangibles = obvious opportunity for money laundering and that, in turn, attracts legal attention.

Some of those issues can be mitigated one way or another, but all of them create headaches for a business operator and not everybody wants to sign up for that.

Bramblethorn

I've seen all of the criticisms you point to before - they are widely preached across the usual corporate media misinformation platforms.

As you probably know, I have been a mid-ranking professional economist in fairly high-level merchant banking, and I did work for a central bank for a short while before that.

The criticisms don't hold water in practical reality - ALTHOUGH I'LL GRANT YOU there is a lot of dispute about it, but not privately in any of the circles I can still have some 'access' in... They all privately concede mainstream banking and traditional sovereign currencies are already dead as the dodo in terms of all the internal long-term strategic planning. Nobody is willing to admit it openly because they would be cutting their own throats over the present fee structures in banking.

I'm not going to outline the major problem with the falsely proclaimed 'problem' being named (incorrectly, I might add) popularly as 'volatility' other than to explain that as far as monetarists are concerned, the moment-to-moment 'price' postings for digital crypto-currencies are really only the flow rate, rather than what you could traditionally apply as the standard meaning for 'price.' Digital currencies are a transaction point (because of the blockchain contract data archive), not a measure of exchange - and this is not that widely understood by the non-economist who is playing around in the space both as a participant and a commentator.

Sure, if someone is playing around with the view to 'buy' as if it were a store of value like some money can be, then they are getting burned regularly. But if someone is TRANSACTING 'a thing' for some other 'thing' across the globe, there is simply no better process obtaining right now.

'Volatility' in economics, is NOT the movement regardless that it might be fast and big or in large measures, it is the terminal value averaged over the standard accounting period of a CAPITAL ACCOUNT (IE 10 years). Same way that the word 'growth' in economics is not the same as the word 'growth' in horticulture; it means the average rise of MARKET PRICE of units of capital over one standard accounting period of 1 year (that is, year-on-year from one year to the immediate next). This is why Margaret Thatcher is always incorrectly viewed as having been good for business since she produced 'economic growth' by forcing owners of capital to sell their stock-piles, cut their forward contributions to fixed capital replacement, sack workers, and sell non-current assets - thereby producing a rising stock-market and higher returns in a few early years compared to costs and debt and underlying fixed assets (IE 'economic growth') of immediate prior years.

And she did it at the cost of the whole entire business and production capital base of Great Britain, destroying mining, craft-works, manufacturing industry, employment, and closing a large number of businesses, or forcing the sell-off of many others, including Rolls Royce, Bentley, Leyland, among the big name brands. From which situation the country has never recovered.

And as far as 'unsavory types' is concerned, go consult any standard academic text-book: crime and 'unsavory types' feed into the domestic economic growth line because they INCREASE the domestic financial costs and through-put of expenditure thus adding to the circulation velocity, which is an economic positive thing. Yep, and it is like 'Satan money' for those of you who are overly-religious...!

Desiremakesmeweak said:

Bramblethorn

I've seen all of the criticisms you point to before - they are widely preached across the usual corporate media misinformation platforms.

As you probably know, I have been a mid-ranking professional economist in fairly high-level merchant banking, and I did work for a central bank for a short while before that.

Click to expand...

My friend, put down the hash pipe.

At some point, the governments of the world are going to work together to shut down cryptocurrencies because ransomware attacks do too much damage. The attack on the NHS probably got the dialogue going. Probably every major employer in the world would support such a shutdown as they fear ransomware attacks. When something is used primarily by criminals, it's not wise to put your money into it.

Lucky you didn't say '17 letters...'

'The governments of the world...'

Fascinating.

But not only that, they are going to 'work together.'

No further comment.

Desiremakesmeweak said:

'The governments of the world...'

Fascinating.

But not only that, they are going to 'work together.'

Click to expand...

You apparently aren't keeping up with the news. From 1/2/17:
Switzerland's reputation as a secretive tax haven looks set to end following the introduction of rules over sharing bank account data.

The International Convention on the Automatic Exchange of Banking Information (AEOI) entered into force on January 1, pulling Switzerland in to line with international standards on taxation.

The convention, developed by the Organization for Economic Co-operation and Development and the global financial industry, states that financial information on Swiss bank accounts held by citizens of certain countries will in future be shared annually and on an automatic basis.

In the past, Switzerland would only provide banking information if requested by a limited number of countries and even then, full co-operation was not guaranteed.
Link
My understanding is that OECD gave all countries where people would secretly stash money a choice - share full information about your accounts or be locked out of the world's financial system. Every country caved.

Desiremakesmeweak said:

Sure, if someone is playing around with the view to 'buy' as if it were a store of value like some money can be, then they are getting burned regularly.

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There you have answered your own question. I would hazard a guess that's exactly how overwhelming majority of people see whatever money.

I have seen 'real world' currency burn in my hands (ex-soviet space), and still majority of people around act like money had some intrinsic value all by itself.

Desiremakesmeweak,

Are you saying that investment in cyrpto is less risky than traditional money markets, or the same risk, or the same kind of risk? Or something else entirely?

(Forgive my layman terminology. Mrs. Oblimo is the expert on monetary theory and finance in my household.)

Edit: I mean, we already have someone shilling ripple and XDR in this thread. That’s an anecdote for a market rife with people looking for suckers.

Oblimo - you must be a genius.

Or maybe very well educated and not letting on.

The word 'economics' comes from Greek as you know - but maybe you also know that it specifically was used by the Athenian senators from the ways their wives and mothers organized and managed the household!! It is SPECIFICALLY from concepts about how to manage a HOUSEHOLD budget which ideas were THEN extrapolated to use in the State.

The word 'risk' also has an academic definition which is never comprehended by the media or by most 'laymen' using the term in news articles and discussions:

'risk' is defined as, the volatility over time which is always equal to absolute zero remaining value (IE total loss). Thus, for professional investors to survive, they must REPLACE a capital asset BEFORE it becomes useless and worthless, whilst ADDING amounts to overcome INFLATION, and working capital written off (DEPRECIATION) and COSTS OF CAPITAL (natural borrowing interest) and the standard period of capital held to so-called 'maturity' is TEN YEARS - which is the reason the benchmark bond rate is always marked to ten years maturity (the annual rate calculated as 'yield' is the average over ten years all things considered).

So... are 'cryptos' more or less 'risky' than traditional money markets? They are the same.

What people never tell you about the Dow Jones, as one example of 'standard tradition' financial market, is that numerous times in history the whole entire Index base has been changed in order to give the impression - via the quoted Index number' - that the underlying value is the same; which it is not at that moment. Further, there have been so many alterations in the BIS exchange standards as well as the reserve guarantees for currencies pretty much in ANY domicile around the world, that there have never been any currency tokens which have been in fact stable by 'real' value ever, anywhere, at all, at any time over any term of capital.

And whilst it appears true that the USD has never suffered capital controls, such is in fact not functionally true - there are capital controls all the time for it, vis-a-vis situations like the one that currently obtains for Russian transactions, Iranian transactions, et cetera. In addition, there is a 100-page document that a foreign transactor must deliver to their US financial agent for ANY financial transaction to do with an American-domiciled company - and THIS has the effect on many occasions, of a de facto capital control. That was the case during the GFC, where no one I knew, who was a foreign investor, was able to repatriate full funds in under six months out of the United States.

So... yeah. As far as I'm concerned, not only is there no difference, but from where I stand, cryptos are vastly superior. For one thing, there is no 'third party' interloper in any transaction. Who invited 'governments' into my sale or purchase? Not me.

I think the present situation with people like Alex Jones, for example, will not only end up giving the lie to 'sunset currencies' but they will actually break the banking system terminally. I expect people to dispute this, but they are pissing into a very strong wind.

Desiremakesmeweak said:

.

So... are 'cryptos' more or less 'risky' than traditional money markets? They are the same.

Click to expand...

How do futures contracts on BitCoin compare to similar contracts on USD, Euros, Pound Sterling, RMB, etc? This is true measure of the risk and volatility of a currency.

Dream_Operator said:

How do futures contracts on BitCoin compare to similar contracts on USD, Euros, Pound Sterling, RMB, etc? This is true measure of the risk and volatility of a currency.

Click to expand...

Might have been in the day and age when the BIS actually enforced timeliness of effecting tx, or guaranteeing the international coverage of participating banks, or oversaw the Luxembourg Treaty re asset ratios - and when WARRANTS ON FUTURES WAS ILLEGAL.

'True measure of risk?'

What is 'true?' Said the jesting classical economist Pilate, and did not tarry to hear the reply.

CALCULATIONS for standard technical definitions of risk are Black & Scholes, and the 'Rule of Ten' or Rule of Twenty,' 'Reversion to Mean,' and maybe Break-Even Analysis and Variations from Index Average.

A 'futures contract' has to be denominated in some currency or other to make any sense at all, and unless a person defines which non-variable common reserve currency is being used to make the 'comparison' with, then these things are like comparing baskets of fruit with the going rate of an electricity utility bill; both things have utility and they both have 'use by' time limitations, but their scale differences are so huge as to make commodity-type comparisons problematical.

...You see, a Bitcoin has a real transaction min/max window of 220 nanoseconds - and none of the other claimed 'currencies' can ever approach that minimum transaction duration (that is, speed). There is a technical consequence of this that many people are presently unwilling to face, namely, that in the past these other things were 'currency' because that's what we had and all that we had - but now, they are not actually 'current' (they take too long to effect transaction with too many conditions externally applied) and therefore they are not currency at all. And THAT'S the problem.

Literally, it means the world has reached terminal risk for those sunset 'currencies.' The negative risk is all on the side of your Euros, GBP's, and so on, and it is maximum negative risk too (IE complete loss/complete failure).

What is being called 'volatility' for the pricing of BitCoin, is really only pricing as per technical non-currencies. If these had the capacity to function in today's world, they would already have built-in forward hedging buffers for novated 'dollar' pricing of BitCoins (what looks like large price drops or rises) AT EVERY TRANSACTION (IE each transaction carries its own DROP AGAINST OTHER CURRENCY BUFFER UP TO SOME FORWARD TERM). Because that is what the BitCoin capacity is.

No, my friend, digital currencies ARE the future money, and none of these other things you are used to, is a currency at all any more albeit there is this present phase of them all being less and less functional in the digital world.

Example: I can buy platinum from Russia direct via BitCoin, with a locked price fix of the commodity IN DOLLARS. And I can do that in 220 nanoseconds - so what do you mean 'BitCoin' is volatile?

How, is it volatile - by the time a downward sloping curve DIRECTION (just the direction) is presented on the dollar-to-BitCoin pricing quote ticker, I can already have moved out of BitCoin in extreme low-latency conditions to a stable liquid commodity fifty times if not a hundred and fifty times.

The pricing of BitCoin against dollars/Euros/whatever - is meaningless in a practical sense to investment professionals. It is really only something we all have to watch on Bloomberg or CNN for no real reason. The only moment the dollar price of BitCoin is important to a person is when that person buys one for the first time.

I don't understand this crypto currency stuff. I write e-books (and paperbacks) and I either get cold, not-easily-traced cash for them or I don't bother trying to sell them at all (and I leave that part to my publishers).

KeithD said:

I don't understand this crypto currency stuff.

Click to expand...

Neither do I.
But then, I'm not an economist; I'll trust my Bank as best I may in the interim. . .

Before considering the "volatility" of crypto currencies the volatility of normal currencies is worth a close look. It is obvious in the cases of Venezuela or Zimbabwe but how about the "big" currencies.

The US dollar for example is on a sharp upward trend, partially driven by the Federal Reserve restricting money supply and partially by poorly thought through tariff policy. The net effect will be to suck in the available capital thus tending to instability - How much instability - I dunno but we will find out.

The Euro is even more interesting, overvalued so far as southern Europe is concerned but undervalued in Germany and the North. Any flow on of increased interest rates from the USA could very quickly cause massive instability in Europe, particularly in the South.

By far the most de-stabilising factor is political intervention - not the currency itself. And the politicians have a vested interest in de-stabilising crypto currencies.

Desiremakesmeweak said:

Or maybe very well educated and not letting on.

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No comment.

So... yeah. As far as I'm concerned, not only is there no difference, but from where I stand, cryptos are vastly superior. For one thing, there is no 'third party' interloper in any transaction. Who invited 'governments' into my sale or purchase? Not me.

Click to expand...

I know it’s completely 18th Century of me, but it’s hard for me to imagine the government as an “interloper” in a transaction where the value of currency is involved. I think I just have an irrational belief that crypto has more modes to fail than fiat money/legal tender. But then, irrational belief is the name of the game.

Desiremakesmeweak said:

'True measure of risk?'

What is 'true?' Said the jesting classical economist Pilate, and did not tarry to hear the reply.

Click to expand...

I think you are my kind of smartass.

...You see, a Bitcoin has a real transaction min/max window of 220 nanoseconds - and none ofthe other claimed 'currencies' can ever approach that minimum transaction duration (that is, speed).

Click to expand...

Are you one of the guys who volunteers to explain to XCOMs how the theory of relativity’s light cone ruins their international trading strategies? “Our network can’t tell you what porkbellies were trading at on the Russian commodities exchange .2 nanoseconds ago because ‘Russia .2 nanoseconds ago’ doesn’t exist.” I love those guys.

Chuckle, smirk.

No but I have some grok for when Assange recently said that there were tiny electronic micro-circuits 'they' could spray around in the air, or implant onto a piece of paper or be even smaller than a fly-on-the-wall, and switch on and activate to do something from a distance via microwaves.

It's a different world except of course all the people are exactly the same as they always ever were deep down inside.

Desiremakesmeweak said:

No but I have some grok for when Assange recently said that there were tiny electronic micro-circuits 'they' could spray around in the air, or implant onto a piece of paper or be even smaller than a fly-on-the-wall, and switch on and activate to do something from a distance via microwaves.

Click to expand...

Assange is a bit of a wackadoo, but there apparently are companies working on “GPS dust”, particulate material you can sprinkle on a person on a car and have them show up as a unique object to track via GPS satellite.

My mother is the biggest eBook reader I know. Guess who set up her Kobo, her accounts, etc? The same person whose PayPal account was used by one of her siblings for years because said sibling couldn't be arsed setting up their own account.

Unless the majority of sellers start demanding crypto, it won't take off. It comes down to laziness, lack of knowledge and fear on the buyer's part. On the other hand, if all sellers, or sellers who have something many people very much want, demand it, then we'll probably see a shift.

I don't even hold out hope that people would want to use crypto and a mixer to buy independent media (which I regretfully suspect will soon become a thing of the past) because no one gives enough of a shit.

I quote from ausfet: "I don't even hold out hope that people would want to use crypto and a mixer to buy independent media (which I regretfully suspect will soon become a thing of the past) because no one gives enough of a shit."

I agree with that in the sense that it states what the current picture indeed is. However so-called channel displacement will alter how demand turns up and for why exactly - there is hope.

Desiremakesmeweak said:

I agree with that in the sense that it states what the current picture indeed is. However so-called channel displacement will alter how demand turns up and for why exactly - there is hope.

Click to expand...

I (genuinely) admire your optimism - unless you're suggesting that necessity will drive a move to crypto in order to restore some semblance of a balance of power, in which case your statement just becomes a scary prediction.

Yeah there are only two scenarios that are possible: one - that digital crypto currencies slowly take a fully parallel market position as money, or two - where they become a necessity due to the currency walls erected by intransigent global 'political elite' interests.

There reason there can no longer be a third/'complete elimination of digital cryptos' scenario is because the system is already widely in use in Japan, India, Taiwan, and Hong Kong and all of these places are simply powerhouses of global economics.

Is the 'scary scenario' a possibility? It is a strong possibility in my view, although it doesn't imply complete break-downs in services, infrastructure maintenance, and other presently taken-for-granted benefits - just that probably selective hyper-inflation will be evidenced, at the same time that selective organized deflation inside domestic economies will obtain because governments and bureaucracies will want to 'protect' their own way of existing once it is clear they actually face terminal threats that they will genuinely experience rather than just theorize about for some distant future.

...I can't see any chance that these dual conditions will be avoided - the bubbles in real estate and debt have meant a radical oversupply of useless unproductive buildings alongside a total lack of industrial production diversity in the developed world. But I don't see the general public comprehending the actual shifts in economic power as these take shape and then crystallize.

We are witnessing the effect I am speaking of in places like Greece right now, where the social impetus for art expression has increased, while the buildings are becoming rundown or replaced with architecturally non-functioning steel and glass boxes. If the QUALITY of innovation driven by necessity rises, then it spells the end for the governing elite; happened this way in Mussolini's Italy, in the Weimar Republic, and although I don't fully equate Post-War Japan or East Germany similarly because of the Marshall Plan, there are aspects of the condition that ARE the same.

The 'front' or 'face' of the revolution this time is electronic technology certainly, rather than industrial iron and steel assembly line revolutions.

One or two more ultra-advanced inventions in micro-electronic circuitry and the world will radically change again away from what we have been used to for the last say fifty years. And I think these things are inevitable, even while doomsayers and naysayers do what they always do - and yet always are proven wrong too.

I'm completely open to the idea of cryptocurrency, but I confess I don't understand bitcoin. I understand, more or less, the ledger/blockchain process, but I don't understand the mining process or the economic function it serves. My big question is, how can one have any confidence in the stability of its value? How is it not open to speculation and crashes? It's embarrassing because I like the idea of a non-governmental currency, but I just don't get it.

Is there a good online source that explains it?

All this advanced fiscal theory has left me more puzzled than hitherto.
So crypto-currencies are, (at least until I can get folding bitcoin money from my Bank)
a dream unrealised. I buy my bits from E-Bay and I seldom have a problem, as
PayPal works for me.