Comparing the market capitalization of Bitcoin to GS or MS is pretty useless. Only interesting info here is the basic fact that today's price hike is bringing BTC close to a $100 million market cap.
Pretty crazy to think about for a thing I passed on buying for $20 a pop.
Market cap is frequently a less-than-useful metric, but for a "currency" like Bitcoin, it means almost nothing. We have no idea, really, how much is circulating, how much is permanently lost, and there's no transaction where the market cap really plays a part.
Well, you can calculate exactly how much is circulating on the blockchain, though off chain places like exchanges and the like represent even more volume.
Curious why this statement of fact is being downvoted.
The value of bitcoin seems to trend more and more towards being a digital wealth store over a currency. In that case BTC "market cap" is a somewhat useful indicator of how much wealth is stored. It's rough but market caps in general are, especially early stage companies.
I'd sell it tomorrow and make about $1bn in profit and move on with my life.
EDIT: I'm editing this because people are missing the point. My point wasn't about how when 1 owner has absolute control BTC is worthless like this guy[1] seems to think or about the liquidity of BTC, like this guy[2] seems to think. My point was about the fact that the difference between BTC is that the only use it has is holding and hoping it moves up, whereas owning a company actually brings in earnings.
That isn't how supply and demand and market liquidity works.
This is why institutional traders have to break up buys or sells over many transactions. If you put up a huge block saying "I want to buy/sell $X million / Y million units of instrument Z" it is going to strongly drive the market away from your bid/ask. In a market like BTC, it might drive the price down 50% within minutes.
In other words, who is going to be on the other side of your market? If you are selling 1000 BTC, and if the top bid price has a quantity of 0.1 BTC, you will blow through the first level, then the second, thrid, etc, through dozens of decreasing price levels, if you are doing market orders. You will take out the ENTIRE BUY SIDE OF THE MARKET, and the price of your last transaction will be thousands of dollars lower than the first price. If you are doing a limit order, then you provide the lowest price you are willing to go, so you might only be able to sell a few coins.
I would rather own all Bitcoin, and sell a tiny fraction to people that want to transact in it, letting the market determine the price of that tiny float and slowly dilute based on demand.
I would also invest into $10B companies with the Bitcoin balance.
This is what you do with illiquid float you control, in any asset class. Whats the real question?
As more people own Bitcoin, the value of Bitcoin goes up as the value of the network increases. As the network becomes more mainstream, more people start questioning why there needs to be a centralized investment bank making $10B in annual operating income.
Is there a particular line of business of Goldman Sachs that you believe is either vulnerable to people's opinions of it as non-competitive with Bitcoin or factually imperiled by the existence of Bitcoin a technology?
I don't have an investment banking background and I'm not a financial services expert, but it does seem services related to raising capital (e.g., underwriting securities, assisting with IPOs, etc.) may not be as valuable with alternative options such as raising financial capital through token sales.
As far as I can tell, investment banks offer a variety of financial services such as assisting with M&A, trading derivatives, underwriting securities, etc.
What is unclear to me is how many of these financial services (e.g., assisting with stock transfer, IPOs, raising capital, etc.) will continue to thrive in the same way that they have been, mostly unchanged for the past several years, when they can be executed in cheaper, more efficient, decentralized marketplace.
I'd love to expand my understand and be proven wrong though so I welcome feedback on this line of thinking.
Just using your initial list how does the blockchain help with M&A? The role of investment bankers in that aspect is to do research. Due diligence, pricing, etc (as well as specialized finance at times).
Or trading derivatives? Derivatives are either traded on extremely efficient exchanges already (the automation of which put a squeeze on IB profits) or are for very bespoke products. I suppose in this area you can come up with a process for making the bespoke products more efficient via the blockchain but the actual ledger on those things isn't the hard part, its the contracts and risk pricing. Even then, the banks customers seem likely to continue to go to them for the expertise in the bespoke products.
For underwriting securities its not clear how the blockchain makes transactions less risky? Again the mechanics of the ledger are fairly easy and efficient already. I suppose there is room for improvement, but the thing people are going to the IB for, and what generates their profits in this area is actually taking on the risk, which the blockchain does not mitigate.
I think you make some very valid points. To be clear my view isn't that blockchain is going to make banks obsolete (this blog post sums that up pretty well: https://blog.chain.com/a-letter-to-jamie-dimon-de89d417cb80). For example, certain activities that you mention, like M&A, are not going to be easily improved by just introducing a blockchain.
What a blockchain is useful for is eliminating the need for a centralized, trusted third party. Where I could see this being very helpful, and a potentially disruptive force is in areas like IPOs, mitigating counterparty risk, reducing conflict of interests, etc.
For example, if companies can raise capital and create liquidity for themselves with ICOs, the demand for IPOs will decrease. If investment banks break the "Chinese" wall and engage in market manipulation, then having public companies put their accounting on a public ledger will reduce the dependence on quarterly earnings reports. If more players are able to access the financial systems because they are on public ledgers rather than private ones, it will make it harder to banks to engage in oligopolistic behavior.
None of these things are guaranteed to happen, and certainly they won't all happen overnight. I do see though, the potential for these types of changes to slowly chip away at some of the revenue streams that banks have enjoyed for a long time.
If a single entity owned all BTC produced it would be largely worthless. There would also be no speculative value in it as no one would have any horse in the race. The value of BTC is driven by the network of BTC and its ability to be used in transactions as well as a speculative instrument.
Given that, If your question is altered to somehow own all of it while keeping its value, i'd rather the 100B easily liquidated assets over 10B revenue yoy.
Except people are actually using GBP for something. BTC is just people holding on to it hoping it goes up.
Put differently, are there any circumstances where people would buy GBP expecting it to go down? What about BTC? That right there tells you the difference between the two.
An interesting question to ponder though is what is the potential in the future. What is the probability that GBP becomes used for something beyond a medium of exchange in the UK?
vs.
What is the probability that BTC becomes a unified international medium of exchange?
I'd challenge this. You only need a smartphone to use bitcoin (not a computer). We are looking at about 3B smartphone users today [0] and close to 6B smartphone users by 2020 [1]. That is nearly ubiquitous coverage.
Also, we are in the early stages of bitcoin today, so yes, you need to have some tech understanding. This will all be abstracted away soon. Do people need to understand TCP/IP to use the internet? Understand the internal combustion engine to drive a car? The same will happen for cryptocurrency.
Not really. I get paid in BTC and I pay my bills with it, buy things on amazon via Purse with it, etc.
There are a great many people building businesses on the unique features of BTC.
This "nobody uses BTC" meme needs to die-- yes, it is still the early days, it's a new technology. We're still in the "hey I got a personal home page on the information super highway!" stage of adoption-- but that didn't mean the internet was useless.... and we haven't even gotten to the bull market and pets.com era. It would be silly to say the web was useless since nobody needs their own homepage.
Depends on the bill. But yes, you can use a bitcoin backed credit card for a lot of bills, and the biller gets paid in dollars which are converted from the bitcoin balance on the card.
I tried for a fixed number of bitcoin per month, but they, not being fools, didn't go for it, and I get a USD salary converted at the exchange rate on the date of payment. This has worked out quite well in a bull market, though.
Yes that may be true, but that also means BTC is essentially in a deflationary period as the buying power of the currency is currently going up with time (unlike most Fiat, which the buying power tends to decrease during an inflationary period) so holding BTC makes sense to a lot of players with it. So there is a bit of an incentive for its use as a speculative instrument.
A lot of the speculative buyers don't really understand how volatile BTC can be and that it is a usable currency.
The reason I say its in a deflationary period (while demonstrably false as more BTC are being produced by miners) is because its BTC / person interested in BTC seems to be decreasing.
Yes, effectively we are experiencing deflation against fiat as the price is going up... and also %80 of all bitcoin has been mined, at the next halving and the one after that the rate of new supply will be cut twice.... which means over the next 8 years, its all going to be about adoption of the ecosystem.
It may turn out that bitcoin is not used for buying daily necessities for awhile, but there are a great number of potential new businesses that will be built on and around bitcoin.
Just like the internet gave us Amazon and Facebook, bitcoin will give us next generation companies that are quite different from the current economy.
"Bitcoin is the internet of money" is really applicable slogan.
It's not. What you say is true, but there's a crucial difference. 65 million people live in the UK and all of those have to pay their taxes in GBP. Also, all listed companies in the UK are listed in GBP. That guarantees that there will always be significant demand for GBP. Not the case for BTC. Note that I'm not saying that there WONT be other reasons that could generate demand for BTC, I'm just saying that BTC is nothing like GBP.
Your point is also valid, however, it had not eluded me. I was just saying that from a speculative perspective, the two are similar (hence, the use of "in that sense"). Essentially what you're saying is that one is government backed and entrenched in society and the other is not - I obviously do not disagree, as this is undeniably true!
I think this could pose a problem in the future for Bitcoin. Bitcoin was meant to be a decentralized vehicle of value that you could use to trade or buy things.
However recently its being treated more as a stock and being stockpiled so I no longer see people as willing to pay for different services etc with Bitcoin as they used to because they can gain more value by waiting which goes against Bitcoin's intent as an independent vehicle of value.
Even though one could argue that Bitcoin has the status of gold but gold is not something one commonly trades or uses to buy food etc in a normal non-disaster scenario.
EDIT: Because this comment is bringing a lot of attention, I would like to reiterate my stance on Bitcoin. I'm supportive of Bitcoin, I would like a decentralized currency that is not tied to the importance of any country or government and as well can be used to foster trade between countries simply because it is much easier to just buy foreign goods than in the current state due to import duties, etc.
Moreover, I see the world moving towards more coming together as a whole than fighting over lands and other issues that don't directly benefit humanity from using Bitcoin.
However my problem is the fast-increasing price of bitcoin is increasingly headed towards the playground of high net-worth individuals or organizations/investment banks such as Goldman Sachs and no longer being able to be traded between normal people who don't have their deep pockets or are scared away by the pricing which prevents Bitcoin from becoming a worldwide vehicle of value to be used for common transactions and sort of deviates from the original intent.
I also know one can trade decimal value Bitcoin for food and it could the volatile nature at play but it defeats the purpose if one needs to first check the Bitcoin markets before deciding on an eventual decimal value amount for the food paid.
You can buy a better computer by waiting. Does that stop you from buying computers?
Considering how easily people invest cryptocurrencies into quite risky ICOs, you can see that people don't have any problem spending, as long as it's something they consider valuable.
It's bad for the velocity of the economy; holding a computer you're not using isn't great, but holding money you're not using is even worse, because by buying the computer you're sending out price signals earlier on that the rest of the economy can use to allocate resources appropriately. And deflation has a nasty tendency to form a self-reinforcing spiral (as does inflation to a slightly lesser extent, so the preferred approach is to have people actively adjusting interest rates etc. to keep a currency value reasonably stable but with a small rate of inflation).
The economy is not everything. It's better people use their money more rationally, rather than buying junk that they don't really need, which then falls apart and poisons our soils and oceans.
Plus it's quite clear to me that people are willing to spend their deflationary currency on the things that they believe in - the whole ICO market demonstrates it.
I dont consider Bitcoins as computers, you're not paying for visas or food with computers because computers aren't vehicles of value and they're not really liquid, you can't just go i'm buying a house with many computers as you can with Bitcoin.
As well as waiting for it, I only pointed this out after reading the fb comments about an article: https://www.google.ca/url?sa=t&source=web&rct=j&url=https://... where they basically did not want to pay because of Bitcoin's worth, again this could be because that they were asking for 60 bitcoins.
That's not really the question though, a better question would be "you need to buy a computer today, do you pay in bitcoin or fiat?"
If you believe that bitcoin is going to be successful then you should absolutely pay in fiat.
There's also a bigger question, I may need a computer today so I'll buy one instead of waiting. But what about the money that I don't need to spend, my retirement fund or something like that? With inflationary currency I have an incentive to invest that money, fueling the economy. With bitcoin I can just let the money sleep in my cold wallet and I know that it'll keep getting more and more valuable by virtue of being in ever more limited supply. The rich get richer and the poor can't get a loan.
Of course you might say that if the economy is unhealthy it'll cause a recession which will end up devaluing my bitcoins, but then you have a prisoner's dilemma: you want people to invest bitcoins into the economy but you sure as hell don't want to be the one doing it.
But remember kids, bitcoin is about killing the greedy banks and helping the poor farmers in Africa or something so fight the good fight and buy those coins.
It's amusing to me how the bitcoin community rejoices every time a business starts accepting bitcoin but at the same time the rallying cry is always "HOLD", as in do not ever spend your bitcoins because they're going to increase in value. There's an amusing dissonance here.
Well, the thing about bitcoin is that anyone can buy bitcoin. If you're poor, you can have coinbase buy $10 in bitcoin a week automatically. It's an investment of a quality that isn't really available in other forms, and accessible to poor people and middle class who are excluded from things like venture capital and other things by securities regulations.
HODL doesn't mean never sell nothing, it means don't try to trade in and out of bitcoin to time the market.
Nothing wrong with spending some bitcoin, that's not opposed to holding, just better to spend less bitcoin than you're earning from your salary each month.
>63% Of Americans Don't Have Enough Savings To Cover A $500 Emergency
Most people simply can't afford to invest a significant amount of money in bitcoin, especially with the high volatility we're having at the moment.
That's actually the point the parent was trying to make, except it backfires here. People won't stop buying food, clothes and paying rent to invest in bitcoin for later returns. They have to spend that money. Rich people on the other hand can do whatever they want.
If poor people want to become rich they'll probably need some initial investment, but bitcoin's deflation removes some of the incentives for rich people to invest money.
One way to solve this issue would be to tax bitcoins savings to force the rich to "spend" their money by paying taxes, but at the same time bitcoin makes it easier than ever to hide and launder your money and even if the state manages to track your account they can't cease it without having access to your private key. Forget the panama papers, forget the lux-leaks. All you need is a computer running the bitcoin client and you can move millions anonymously without any intermediary.
I don't understand the comment "especially with the high volatility we are seeing at the moment". Volatility doesn't change your ability to have coinbase buy $10 in bitcoin every week... in fact because of volatility you can dollar cost average that way. Even you could have them do $10 a day if you want to put in $300 a month. There are millions of people who can afford that... but they don't save, as you have pointed out.
The not saving part is a cultural and habitual issue. People were addicted to credit in the past 20 years and this is due to a lot of forces, mostly government driven that benefit a fiat currency system.
Bitcoin not being fiat is quite different and it will take decades for habits to change, this is true.
That said, my facebook is overrun with non-technical, random people who are buying Bitcoin and Ethereum.
I don't see how bitcoins very low inflation rate (which produces price appreciation as adoption increases) disincentives investment.... instead it's an incentive because you can see the change month to month.
Taxing bitcoin and making the rich spend their bitcoins makes no sense... there are bitcoin whales with 100 times as many bitcoin as I have... doesn't affect me. IT's not a disincentive in the least.
By the high volatility I meant that poor people can't invest money they can't afford to lose because it's too risky at the moment. You can't invest $500 to take them out two months for now because you don't know if they'll be worth $1000 or $50 by then.
>Taxing bitcoin and making the rich spend their bitcoins makes no sense... there are bitcoin whales with 100 times as many bitcoin as I have... doesn't affect me. IT's not a disincentive in the least.
That's the kind of short sightedness that worries me about the bitcoin ecosystem. It does affect you if you ever need a loan to buy a house or start a business because those "whales" which will be the new 1percenters won't have any incentive to lend you money. The rich gets richer, the poor remains where they are. We end up with all the problems and inequalities we have today, except worse.
We killed the banks and replaced them with other banks except these new banks are even more opaque and will be even more stingy about lending you money. And on top of that we waste an ungodly amount of energy securing the blockchain. How is that an improvement again?
Your response comes from a.... perspective on economics that makes no sense to me. It's irrelevant if others have more bitcoin... if I am getting a loan, I'm certainly going to get it in the US dollar which has already lost %99.99 of its value.... cause I can pay it back in even more worthless dollars down the road.
In fact, my car loan's interest rate is below the rate of real inflation--- glad I bought bitcoin instead of paying cash!
You can't provide any evidence that we waste any energy on securing the block chain, in fact, the market value of bitcoin makes mining profitable, proving you wrong.... further, you ignore the cost of fiat currencies which are several orders of magnitude higher, including in energy usage.
You can buy a better computer by waiting. Does that stop you from buying computers?
It does in practice, actually. But there is always some portion of the market that needs the better system now. That is much less true of Bitcoin, which is mostly held for speculation rather than as a currency. People who are forced to "spend" Bitcoin are people who want to realize their speculative gain and exchange it for dollars, which they then use as currency because it's still vastly more convenient than Bitcoin.
That's predictable though, given the deflationary nature of the currency. If bitcoin is successful then it'll keep increasing in value. That means that there's very little incentive to ever spend your bitcoins if you can avoid it.
recently? well folks look like this argument is going to be around forever. people were saying the same things in 2012.
bitcoin is functioning at the same standard of any existing currency, so no need to make a new higher standard for it. The M1 supply is a tiny fraction of the asset and used for buying things. The M2 and M3 supply is a larger stockpiled group which is also being used for investing in things inside of its own economy.
I understand I am making a presumption here by saying this and can be proven wrong, but I cant find exact data on people spending a lot of Bitcoin on services that take in Bitcoin thus I am presuming that people dont want to pay but are buying and holding Bitcoin and thus operates with a different standard than your typical US dollar which could pose a problem and also kind of goes against the idea of a currency used by everyone and decentralized from any govt.
There's no way to definitely prove you wrong, and there's no way your presumption can be proven right.
Bitcoin volumes increase month over month, Bitcoin transactions onchain still increase month over month, or at least year over year so far, you can try to extrapolate days destroyed to see how much of the supply moves
But you will never know the purpose behind the transactions.
Payment processors releasing data wouldn't even give a picture of peer to peer purchases happening, and they aren't even releasing data.
People investing in mining cooperatives, mining hardware, and token sales for all manner of organizations, are all part of the picture. And this will be in the billions this year.
Bitcoin is a currency going thru the technology adoption cycle. This is a really new thing.
The technology adoption cycle-- what the internet and smart phones went thru-- is when increasingly large waves of population accept the new technology.
Bitcoin still has some UI issues and a steep learning curve, and as a new form of money has to overcome massive societal inertia as to "what money is".
That said, so long as it is going thru this process, it will operate more as a store of value and speculative investment than as a currency.
Bitcoins volatility has been declining over the years, as it gets closer, though it's a long way off.
So the currency use case is less dominant now and will be as it is distributed to wider and wider numbers of people.
One thing we have to overcome is the idea you deal in "bitcoins".... bitcoin is divisible to 1/100,000,000th of a coin-- a satoshi.
When people get in the habit and comfortable with owning partial bitcoins, it will go much wider.
There will only be 21 million bitcoins in existence, there are 11 million millionaires in the USA alone.
That means that even american millionaires will never be able to own 2 bitcoins.
Early on, I expect that Bitcoin will have lower prices when the Fiat market crashes, because people will sell assets to raise money to cover margin calls.
However, Bitcoin generally has rallies whenever government tries to control markets in a crisis-- for example Cypress forcing everyone to take a haircut -- a lot of people moved to bitcoin to protect their assets.
As governments continue to mismanage their economies and their currencies, this is bullish for bitcoin because it was designed to solve these problems once and for all, or at least try to.
Probably easiest to read that as "the stock market" but I mean stocks, bonds, treasuries and other assets. We had market crashes in 2001 and 2008, and there is another one likely in the next couple of years, I expect. Quantitative Easing has given us a fiat bubble across many asset classes, and I expect it will crash, and Bitcoin will be hurt in the short term and then rally in the medium term as the crash continues...
That makes it very clear, thank you. So, let's say the Fiat markets go down holistically and people have assets in the Fiat markets like stocks. The market trends downward for a while and people sell their assets to avoid the "crash" or potential "forever loss" of assets. So, people will also likely sell their bitcoins off at this time, and in general the price will be lower for a good sprint.
Thanks for clarifying, I believe I caught your gist.
I expect bitcoin will crash in the early days as well... but it's unclear how long that will be, or whether it will become a safe haven that people start buying again.
Bitcoin is literally a response to the 2008 crisis-- the genesis block has a quote about bank bailouts.
Subprime mortgage is very different my friend. A mortgage is basically a long-term loan that you get to buy a house. You pay it off monthly, and if for some reason you don't make payments for a long time, well, the house goes back to the person who lent you the money to get it (usually the bank). With Bitcoins, people mine them for themselves (like finding a valuable mineral) or they buy them on an exchange. If the price of the coin goes way low, people who have a lot invested in it may not be able to sell it for a while, but hopefully nobody is getting kicked out of their house over it.
When "the bitcoin" starting gaining momentum, i thought that "bitcoin" and the public distributed ledger was an exercise to see if the psychology of people has evolved to reduce the dependence on institutions and find out if inequality is because of these institutions or the 1%. However as we are finding out, the same problems are arising but with new technology. The ones with money to risk are playing the game and the public distributed ledger and bitcoin is yet to show us anything different other than the status quo. Who gives a shit if it's decentralized and "transparent" if the problems that a lot of people touted bitcoin/blockchain would "solve" are just replicated. Kinda like who cares if there are many choices, if you don't have the capital to exercise those choices. I am beginning to think that bitcoin is just another channel to speculate on that promises anonymity but fails badly at it. Maybe it's pre-packaging as an antidote to pre-bitcoin financial structure was empty. I don't see how the average world citizen is able to invest with these prices, therefore aiding mobility. I thought wrong... but sure wish i bought it when it was $20 :)
In what ways does Bitcoin recreate the status quo problems of (1) the central bank being able to print arbitrary amounts of money, and (2) all individual-to-individual payments subject to censorship by a very small number of third-parties?
(1) Bitcoin Cash, Bitcoin Gold, etc. Effectively "printing money". Perhaps not entirely arbitrary, as it's limited to the number of bitcoins in existence in the "main" chain at the time of the fork, but good enough.
(2) There are a very small number of third parties that control the vast majority of hashing power
There is nothing in the protocol that will prevent anyone from hoarding or buying large amounts of bitcoin because they already have the capital to begin with. Therefore you can think of those people as similar to institutions or the 1%. So bitcoin is just another investment mechanism. That's all. No panacea here, just an over-hyped new technology that helps create profit for the ones who already have money. One that currently is only available to people who have enough resources to risk. The panacea that "bitcoin" was touted as across the web and forums galore, is just utter bs. I see a world of many private blockchain implementations but nothing that solves these censorship and printing money issues you speak of. Since according to popular theory when you print money your currency get devalued, but bitcoin also goes down when a gov say we don't like it or someone decides to start cashing in at a large scale or overhype of an issue or underhype of another. The end result is the same, less value.
But here are your answers:
1) You live and take advantage of many things you might take for granted in a society that has a certain framework that must be maintained by service providers and it is maintained implicitly by the hordes of people on earth, when greed occurs or kinks in the system happen, printing money or not printing money are just tools to deal with issues.
2) Last time i bought something on craigslist, ebay, alibaba, amazon or from Sandy down the street i don't remember any censorship. I could be mistaken though. Maybe i did not think about something. I would like to see an example of this payment censorship you say largely affected your personal life.
Now definitely if you are trying to buy armored tanks, automatic weapons, drugs, women, censored dildos, yeah i could definitely see censorship. I just don't try to buy those things. :)
Don't get mad now, my sense of humor is an acquired taste :)
The %1 has preferential, essentially exclusive access to high risk, high reward investments, namely startups and hedge funds... but bitcoin and ethereum etc give regular people access to such invesmtents that accredited investors would previously had exclusive access to. This enables the %99 to invest in a way they couldn't before.
There are a lot of people who got rich because they got into bitcoin early... well, here's the secret-- it's still early. Very early.
Bitcoin solves the censorship issue-- nobody can stop you from transacting your bitcoin. It's not perfectly private, but things like z.cash and other technologies are enabling the anonymous own and control of bitcoin.
Printing money is a form of theft. People will pay for services they want. There's no problem for Amazon or Walmart or any of hundreds of service providers getting people to pay for their services. They don't have the ability to just print money to pay themselves (and give to the well connected-- it's ironic you call this a tool when we have seen $10T in new money issuance since 2008 that has mostly gone to politically connected %1 to enrich themselves at our expense.)
Censorship happens all the time-- government prevents you from buying insurance under Obamacare, for example. (literally, obamacare plans have no underwriting and thus are not insurance) that's a whole category of goods that are moral yet illegal to sell, and you are forced to buy an inferior product to replace it that doesn't deliver on the same promise.
Further, censorship is present in the form of border controls-- there were reports of agents stopping people on jetways as they were boarding jets to search to see if they were taking gold out of the country. From 1915-1975 approximately it was illegal to own gold in the USA and smuggling was occurring.... that's literal financial censorship and it ended not that long ago. There are a great deal of controls on USD movement, FINCEN wants to track your assets internationally, and ultimately restrict what you can move and when... that's censorship.
The 1% also has access to bitcoin. I would love to see the yearly incomes of people who invest in bitcoin and than we shall see about this "bitcoin is for everyone" rhetoric. Actually in fact, i would love to see a lot more transparency about the people who do invest in bitcoin, so the bitcoin story can be developed supported by more facts. So that way we will know who the interested parties are which will tell us lots about it.
The censorship issues you describe are describing people that already have money, so i don't know how these people don't follow in the above category. It sounds like these people don't want to pay any gov tax, well those are the kind of people that should stop using any of the services that society pays for using tax. They wouldn't go very far if that was to happen would they. I don't feel bad for them. If gov tax is such a big issue, why even live in society, money surely came to your pocket from society in the first place, you had to make it somehow, whether legally or illegally. So you definitely benefited. Essentially you are stealing from everyone in society when you are attempting to avoid tax or tariffs when moving your money out of the country. How much money do you really need man? The people that are investing in bitcoin are not living on a dollar a day.
Bitcoin is not for everyone and it does not make it easier for wealth to be distributed or aids upward mobility unless you count the early adopters which a lot of them just so happen to be insiders in the first place. Similar to insider traders.
Borders aren't going anywhere for a while. The real question is if these people have this money that are scared that it might be taxed or prevented from going out of the country. How did they make it in the first place?
The points you bring up have to do with people which do not want to support the society in which they live. They want to take more of the pie and bitcoin is an avenue for that at a larger scale than before.
I'm not looking for moral high ground here, but i just don't see how it benefits the regular population.
Ladies and gentleman, time to buy, it has been noted that suddenly bitcoin will solve the US health insurance problem. Right...
Smuggling will always occur before and after bitcoin.
It's really none of your business who owns bitcoin. This surveillance society we are in isn't keeping the %1 in check. bitcoin is a reaction to that, as well as to the fiat fractional reserve banking system.
People are happy to pay for internet service. If government was delivering value, then people would be happy to pay for it... alas, most of your tax money goes to blowing up brown people and paying off political allies than actually providing any services.
I always love the "if you aren't robbed as much as I think you should, you are stealing from me" argument.
Everyone who buys bitcoin today is an early adopter. We have not crossed the chasm. but we are getting close.
How people make their money is none of your business. And you legitimately cannot move large amounts of money outside the country without being spied upon. It's not a question of the source of the funds, but the government trying to control the flow of resources out of the jurisdiction as a result of their terrible management of the economy. That's what exchange controls are all about. Delaying the collapse of a hyper inflationary currency.
Yeah, you think people wanting to avoid theft are greedy, you're wrong.
You're not even responding to the healthcare point, misrepresentation isn't impressive.
Really sounds like you have a major axe grind, but I gotta tell you, buddy, so long as you go around thinking other people are your property to enslave you're going to have a bad time.
Bitcoin is liberating us from authoritarians like you.
Oh now the government is stealing from you. I think it's time to open the faraday cage and come out. Everything is everyones business, now i am the oppressor because i ask questions and don't drink your bitcoin kool aid. right... We need more people like you liberating us from the phantom forces of evil, i award you the golden cross of the bitcoin nation, mission accomplished. I didn't respond to the healthcare point because it's a bullshit attempt at an anchor which has no basis.
For the record, i have no axe to grind, i could care less because i am not involved in trading bitcoin. Just want to understand it better and clear the smoke a bit.
On the last point about investing with "these prices" ... remember bitcoins are divisable into many decimal places. So you can "invest" $20 if that's all you've got, and you get an equitable amount (per current market conditions)
I still don't understand the volatility argument. Bitcoin is up 10X since spring 2016.... that volatility is not a problem! You just have to not care about the %30 up down in the middle.
The price is growing i agree. Volatility relating to security and assurance. Not being able to trust exchanges, having to trust the developers because majority of the people will not read the code for many reasons and lack of regulation. The fact that there is nothing to stop a bunch of people getting together and attempt to control the network. Which probably already has happened. These factors add up to volatility.
Wouldn't it make more sense to compare the value of all of the bitcoins to the total assets under management of the large banks? Many of them manage over a trillion in assets. Bitcoin is designed to be a replacement for bank accounts and credit cards in a sense, just without all of the centralized authority and meat powered overhead to keep everyone trusting it. Its kind of crazy that it has worked out so well. While there have been significant investments on hardware to power the network, I'd have to assume the cost of maintaining the network is pennies compared to what a bank spends to manage assets. That is the real disruptive power of bitcoin.
You know just recently I did my own research in this vein. I looked at the total number of USD in circulation, worldwide. In 1990 it is reported that the number of USD in circulation surpassed 1Trillion. If we make BTC the new "gold standard" to back every single dollar bill in existence, that makes every bitcoin worth about $100. Now, since 1990 was over 17 years ago, if we assume that the figure has perhaps doubled to 2Trillion dollars in circulation (somewhere between 1 and 2 Trillion certainly) then one bitcoin is worth about $50.00 One bitcoin today runs for about $5,700.00
Anyway, just a very interesting thing, because if you divide the total number of dollars by the total number of bitcoins, you get the figures above ($50 - $100 per coin) Which means, using my super simple maths, that bitcoin, as an international bank, is currently performing at 1/10th the cost :)
Gold's money supply is about $8T, and I think Dollars (not just physical bills) is much bigger-- at least $20T.
I think your math is off. Bitcoin is approaching a $100B market cap, and there are only 21 million bitcoins that will ever be in existence.
To match the dollars $20T total supply (a low end number depending on which money supply number you use it could be a multiple of that) then each bitcoin would be worth about $1M.
To match gold in market cap, would be $380,000 per bitcoin.
Truth is, though, when bitcoin comes into its own, the value of the dollar will drop (well, its true value will be realized) so prices would likely be much higher... assuming bitcoin succeeds and becomes a common world currency.
Wow, dollars in the world is $20T or some multiple? That's a great figure! I did not know that. Yes, $1T was the figure in 1990 but for physical dolla dolla bills.
I was attempting to link USD in circulation to BTC, not paying attention to BTC market price. With your updated figures $21T USD in circulation makes each Bitcoin $1M yes, your math checks out. ($1M x $1M is $1T ... were we to somehow make BTC our new Cryptographic "Gold standard")
With each bitcoin worth $1M, that makes each Satoshi about ... a penny?
I don't really know what the ultimate value of bitcoin will be-- really determines on how well it resists attacks, and what level of services are built on top of it.
Absolutely, it's not something transparent at this point, what the true realized value of a coin will be over the long-term. I appreciate your insights regardless, thanks for updating me on the amount of USD in circulus
A better comparison is between bitcoin and countries currencies... it's something like number 59 in the world, though that is from a couple weeks ago.
Bitcoin is really a new currency, and comparing it to company market caps and banks sizes is not really fundamentally useful, but it is useful for giving an idea of the size of the bitcoin economy.
Number 59 based simply on the amount of Bitcoin owned, or the rate of real world transactions (as opposed to mere speculation) conducted in it? I would argue that the latter is a more valid way to measure a currency, and I seriously doubt Bitcoin would crack the top 100 by that measure. The Bitcoin "economy" is almost entirely made up of currency trading.
Ranked by value. I don't get how "mere speculation" is considered a bad thing, or makes bitcoin irrelevant. IF it's digital gold right now, fine. Its gold that costs nothing to store, and very little to transport, unlike actual gold.
Gold has a market cap of $8T. If that's the use case bitcoin ever has, it will still ultimately be worth $380k each if it grows to bitcoins size... and it has several advantages over gold.
Is gold worthless because its "merely speculative"??
I didn't say Bitcoin was worthless, it clearly is not. But it is not a viable currency yet. Gold is also not much used as currency anymore, though it once was.
People don't seem to get this. Unlike Berkeshire Hathaway or any other stock, you don't have to buy a whole unit. BRKA shares at 6 figures are out of range for most people because you have to buy at least one whole share.
Bitcoin is divisible down to the satoshi-- 100,000,000th of a bitcoin. That's too small to transact in currently, but there's nothing stopping you from buying 0.1 or 0.01 bitcoin.
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[ 2.5 ms ] story [ 165 ms ] threadPretty crazy to think about for a thing I passed on buying for $20 a pop.
That's the total value of bitcoin at the moment. How is that made up and meaningless?
Curious why this statement of fact is being downvoted.
I'd sell it tomorrow and make about $1bn in profit and move on with my life.
EDIT: I'm editing this because people are missing the point. My point wasn't about how when 1 owner has absolute control BTC is worthless like this guy[1] seems to think or about the liquidity of BTC, like this guy[2] seems to think. My point was about the fact that the difference between BTC is that the only use it has is holding and hoping it moves up, whereas owning a company actually brings in earnings.
[1] https://news.ycombinator.com/user?id=code-is-code
[2] https://news.ycombinator.com/user?id=jawilson2
Happy? Do you miss the forest for the trees a lot, or only when you're on HN?
In my mind, it's conceptually similar to elastic/inelastic demand curves.
This is why institutional traders have to break up buys or sells over many transactions. If you put up a huge block saying "I want to buy/sell $X million / Y million units of instrument Z" it is going to strongly drive the market away from your bid/ask. In a market like BTC, it might drive the price down 50% within minutes.
In other words, who is going to be on the other side of your market? If you are selling 1000 BTC, and if the top bid price has a quantity of 0.1 BTC, you will blow through the first level, then the second, thrid, etc, through dozens of decreasing price levels, if you are doing market orders. You will take out the ENTIRE BUY SIDE OF THE MARKET, and the price of your last transaction will be thousands of dollars lower than the first price. If you are doing a limit order, then you provide the lowest price you are willing to go, so you might only be able to sell a few coins.
I would also invest into $10B companies with the Bitcoin balance.
This is what you do with illiquid float you control, in any asset class. Whats the real question?
What is unclear to me is how many of these financial services (e.g., assisting with stock transfer, IPOs, raising capital, etc.) will continue to thrive in the same way that they have been, mostly unchanged for the past several years, when they can be executed in cheaper, more efficient, decentralized marketplace.
I'd love to expand my understand and be proven wrong though so I welcome feedback on this line of thinking.
Or trading derivatives? Derivatives are either traded on extremely efficient exchanges already (the automation of which put a squeeze on IB profits) or are for very bespoke products. I suppose in this area you can come up with a process for making the bespoke products more efficient via the blockchain but the actual ledger on those things isn't the hard part, its the contracts and risk pricing. Even then, the banks customers seem likely to continue to go to them for the expertise in the bespoke products.
For underwriting securities its not clear how the blockchain makes transactions less risky? Again the mechanics of the ledger are fairly easy and efficient already. I suppose there is room for improvement, but the thing people are going to the IB for, and what generates their profits in this area is actually taking on the risk, which the blockchain does not mitigate.
What a blockchain is useful for is eliminating the need for a centralized, trusted third party. Where I could see this being very helpful, and a potentially disruptive force is in areas like IPOs, mitigating counterparty risk, reducing conflict of interests, etc.
For example, if companies can raise capital and create liquidity for themselves with ICOs, the demand for IPOs will decrease. If investment banks break the "Chinese" wall and engage in market manipulation, then having public companies put their accounting on a public ledger will reduce the dependence on quarterly earnings reports. If more players are able to access the financial systems because they are on public ledgers rather than private ones, it will make it harder to banks to engage in oligopolistic behavior.
None of these things are guaranteed to happen, and certainly they won't all happen overnight. I do see though, the potential for these types of changes to slowly chip away at some of the revenue streams that banks have enjoyed for a long time.
Given that, If your question is altered to somehow own all of it while keeping its value, i'd rather the 100B easily liquidated assets over 10B revenue yoy.
Put differently, are there any circumstances where people would buy GBP expecting it to go down? What about BTC? That right there tells you the difference between the two.
An interesting question to ponder though is what is the potential in the future. What is the probability that GBP becomes used for something beyond a medium of exchange in the UK?
vs.
What is the probability that BTC becomes a unified international medium of exchange?
Also, we are in the early stages of bitcoin today, so yes, you need to have some tech understanding. This will all be abstracted away soon. Do people need to understand TCP/IP to use the internet? Understand the internal combustion engine to drive a car? The same will happen for cryptocurrency.
[0] https://www.strategyanalytics.com/strategy-analytics/blogs/s... [1] https://techcrunch.com/2015/06/02/6-1b-smartphone-users-glob...
There are a great many people building businesses on the unique features of BTC.
This "nobody uses BTC" meme needs to die-- yes, it is still the early days, it's a new technology. We're still in the "hey I got a personal home page on the information super highway!" stage of adoption-- but that didn't mean the internet was useless.... and we haven't even gotten to the bull market and pets.com era. It would be silly to say the web was useless since nobody needs their own homepage.
It is a bit of a challenge.
Out of curiosity: Do you get paid x BTC per month/week or do you get x $/€/£/etc. in BTC?
A lot of the speculative buyers don't really understand how volatile BTC can be and that it is a usable currency.
The reason I say its in a deflationary period (while demonstrably false as more BTC are being produced by miners) is because its BTC / person interested in BTC seems to be decreasing.
It may turn out that bitcoin is not used for buying daily necessities for awhile, but there are a great number of potential new businesses that will be built on and around bitcoin.
Just like the internet gave us Amazon and Facebook, bitcoin will give us next generation companies that are quite different from the current economy.
"Bitcoin is the internet of money" is really applicable slogan.
However recently its being treated more as a stock and being stockpiled so I no longer see people as willing to pay for different services etc with Bitcoin as they used to because they can gain more value by waiting which goes against Bitcoin's intent as an independent vehicle of value.
Even though one could argue that Bitcoin has the status of gold but gold is not something one commonly trades or uses to buy food etc in a normal non-disaster scenario.
EDIT: Because this comment is bringing a lot of attention, I would like to reiterate my stance on Bitcoin. I'm supportive of Bitcoin, I would like a decentralized currency that is not tied to the importance of any country or government and as well can be used to foster trade between countries simply because it is much easier to just buy foreign goods than in the current state due to import duties, etc.
Moreover, I see the world moving towards more coming together as a whole than fighting over lands and other issues that don't directly benefit humanity from using Bitcoin.
However my problem is the fast-increasing price of bitcoin is increasingly headed towards the playground of high net-worth individuals or organizations/investment banks such as Goldman Sachs and no longer being able to be traded between normal people who don't have their deep pockets or are scared away by the pricing which prevents Bitcoin from becoming a worldwide vehicle of value to be used for common transactions and sort of deviates from the original intent.
I also know one can trade decimal value Bitcoin for food and it could the volatile nature at play but it defeats the purpose if one needs to first check the Bitcoin markets before deciding on an eventual decimal value amount for the food paid.
Considering how easily people invest cryptocurrencies into quite risky ICOs, you can see that people don't have any problem spending, as long as it's something they consider valuable.
On the margin, yes. It doesn't stop me from ever doing it, but it does mean I put off upgrading as long as possible.
Plus it's quite clear to me that people are willing to spend their deflationary currency on the things that they believe in - the whole ICO market demonstrates it.
As well as waiting for it, I only pointed this out after reading the fb comments about an article: https://www.google.ca/url?sa=t&source=web&rct=j&url=https://... where they basically did not want to pay because of Bitcoin's worth, again this could be because that they were asking for 60 bitcoins.
To clarify, computer markets emulate the deflationary nature of something like bitcoin. Yet they sell just fine.
If you believe that bitcoin is going to be successful then you should absolutely pay in fiat.
There's also a bigger question, I may need a computer today so I'll buy one instead of waiting. But what about the money that I don't need to spend, my retirement fund or something like that? With inflationary currency I have an incentive to invest that money, fueling the economy. With bitcoin I can just let the money sleep in my cold wallet and I know that it'll keep getting more and more valuable by virtue of being in ever more limited supply. The rich get richer and the poor can't get a loan.
Of course you might say that if the economy is unhealthy it'll cause a recession which will end up devaluing my bitcoins, but then you have a prisoner's dilemma: you want people to invest bitcoins into the economy but you sure as hell don't want to be the one doing it.
But remember kids, bitcoin is about killing the greedy banks and helping the poor farmers in Africa or something so fight the good fight and buy those coins.
It's amusing to me how the bitcoin community rejoices every time a business starts accepting bitcoin but at the same time the rallying cry is always "HOLD", as in do not ever spend your bitcoins because they're going to increase in value. There's an amusing dissonance here.
HODL doesn't mean never sell nothing, it means don't try to trade in and out of bitcoin to time the market.
Nothing wrong with spending some bitcoin, that's not opposed to holding, just better to spend less bitcoin than you're earning from your salary each month.
>63% Of Americans Don't Have Enough Savings To Cover A $500 Emergency
Most people simply can't afford to invest a significant amount of money in bitcoin, especially with the high volatility we're having at the moment.
That's actually the point the parent was trying to make, except it backfires here. People won't stop buying food, clothes and paying rent to invest in bitcoin for later returns. They have to spend that money. Rich people on the other hand can do whatever they want.
If poor people want to become rich they'll probably need some initial investment, but bitcoin's deflation removes some of the incentives for rich people to invest money.
One way to solve this issue would be to tax bitcoins savings to force the rich to "spend" their money by paying taxes, but at the same time bitcoin makes it easier than ever to hide and launder your money and even if the state manages to track your account they can't cease it without having access to your private key. Forget the panama papers, forget the lux-leaks. All you need is a computer running the bitcoin client and you can move millions anonymously without any intermediary.
The not saving part is a cultural and habitual issue. People were addicted to credit in the past 20 years and this is due to a lot of forces, mostly government driven that benefit a fiat currency system.
Bitcoin not being fiat is quite different and it will take decades for habits to change, this is true.
That said, my facebook is overrun with non-technical, random people who are buying Bitcoin and Ethereum.
I don't see how bitcoins very low inflation rate (which produces price appreciation as adoption increases) disincentives investment.... instead it's an incentive because you can see the change month to month.
Taxing bitcoin and making the rich spend their bitcoins makes no sense... there are bitcoin whales with 100 times as many bitcoin as I have... doesn't affect me. IT's not a disincentive in the least.
>Taxing bitcoin and making the rich spend their bitcoins makes no sense... there are bitcoin whales with 100 times as many bitcoin as I have... doesn't affect me. IT's not a disincentive in the least.
That's the kind of short sightedness that worries me about the bitcoin ecosystem. It does affect you if you ever need a loan to buy a house or start a business because those "whales" which will be the new 1percenters won't have any incentive to lend you money. The rich gets richer, the poor remains where they are. We end up with all the problems and inequalities we have today, except worse.
We killed the banks and replaced them with other banks except these new banks are even more opaque and will be even more stingy about lending you money. And on top of that we waste an ungodly amount of energy securing the blockchain. How is that an improvement again?
In fact, my car loan's interest rate is below the rate of real inflation--- glad I bought bitcoin instead of paying cash!
You can't provide any evidence that we waste any energy on securing the block chain, in fact, the market value of bitcoin makes mining profitable, proving you wrong.... further, you ignore the cost of fiat currencies which are several orders of magnitude higher, including in energy usage.
It does in practice, actually. But there is always some portion of the market that needs the better system now. That is much less true of Bitcoin, which is mostly held for speculation rather than as a currency. People who are forced to "spend" Bitcoin are people who want to realize their speculative gain and exchange it for dollars, which they then use as currency because it's still vastly more convenient than Bitcoin.
bitcoin is functioning at the same standard of any existing currency, so no need to make a new higher standard for it. The M1 supply is a tiny fraction of the asset and used for buying things. The M2 and M3 supply is a larger stockpiled group which is also being used for investing in things inside of its own economy.
Thats not controversial.
Bitcoin volumes increase month over month, Bitcoin transactions onchain still increase month over month, or at least year over year so far, you can try to extrapolate days destroyed to see how much of the supply moves
But you will never know the purpose behind the transactions.
Payment processors releasing data wouldn't even give a picture of peer to peer purchases happening, and they aren't even releasing data.
People investing in mining cooperatives, mining hardware, and token sales for all manner of organizations, are all part of the picture. And this will be in the billions this year.
Many people have their only income in Bitcoin. I do.
I am forced to spend (or, at minimum, sell) Bitcoin because if I don't, I don't have any food or housing.
The technology adoption cycle-- what the internet and smart phones went thru-- is when increasingly large waves of population accept the new technology.
Bitcoin still has some UI issues and a steep learning curve, and as a new form of money has to overcome massive societal inertia as to "what money is".
That said, so long as it is going thru this process, it will operate more as a store of value and speculative investment than as a currency.
Bitcoins volatility has been declining over the years, as it gets closer, though it's a long way off.
So the currency use case is less dominant now and will be as it is distributed to wider and wider numbers of people.
One thing we have to overcome is the idea you deal in "bitcoins".... bitcoin is divisible to 1/100,000,000th of a coin-- a satoshi.
When people get in the habit and comfortable with owning partial bitcoins, it will go much wider.
There will only be 21 million bitcoins in existence, there are 11 million millionaires in the USA alone.
That means that even american millionaires will never be able to own 2 bitcoins.
However, Bitcoin generally has rallies whenever government tries to control markets in a crisis-- for example Cypress forcing everyone to take a haircut -- a lot of people moved to bitcoin to protect their assets.
As governments continue to mismanage their economies and their currencies, this is bullish for bitcoin because it was designed to solve these problems once and for all, or at least try to.
Hope that makes it clearer.
Thanks for clarifying, I believe I caught your gist.
Bitcoin is literally a response to the 2008 crisis-- the genesis block has a quote about bank bailouts.
In what ways does Bitcoin recreate the status quo problems of (1) the central bank being able to print arbitrary amounts of money, and (2) all individual-to-individual payments subject to censorship by a very small number of third-parties?
(2) There are a very small number of third parties that control the vast majority of hashing power
But here are your answers:
1) You live and take advantage of many things you might take for granted in a society that has a certain framework that must be maintained by service providers and it is maintained implicitly by the hordes of people on earth, when greed occurs or kinks in the system happen, printing money or not printing money are just tools to deal with issues.
2) Last time i bought something on craigslist, ebay, alibaba, amazon or from Sandy down the street i don't remember any censorship. I could be mistaken though. Maybe i did not think about something. I would like to see an example of this payment censorship you say largely affected your personal life.
Now definitely if you are trying to buy armored tanks, automatic weapons, drugs, women, censored dildos, yeah i could definitely see censorship. I just don't try to buy those things. :)
Don't get mad now, my sense of humor is an acquired taste :)
There are a lot of people who got rich because they got into bitcoin early... well, here's the secret-- it's still early. Very early.
Bitcoin solves the censorship issue-- nobody can stop you from transacting your bitcoin. It's not perfectly private, but things like z.cash and other technologies are enabling the anonymous own and control of bitcoin.
Printing money is a form of theft. People will pay for services they want. There's no problem for Amazon or Walmart or any of hundreds of service providers getting people to pay for their services. They don't have the ability to just print money to pay themselves (and give to the well connected-- it's ironic you call this a tool when we have seen $10T in new money issuance since 2008 that has mostly gone to politically connected %1 to enrich themselves at our expense.)
Censorship happens all the time-- government prevents you from buying insurance under Obamacare, for example. (literally, obamacare plans have no underwriting and thus are not insurance) that's a whole category of goods that are moral yet illegal to sell, and you are forced to buy an inferior product to replace it that doesn't deliver on the same promise.
Further, censorship is present in the form of border controls-- there were reports of agents stopping people on jetways as they were boarding jets to search to see if they were taking gold out of the country. From 1915-1975 approximately it was illegal to own gold in the USA and smuggling was occurring.... that's literal financial censorship and it ended not that long ago. There are a great deal of controls on USD movement, FINCEN wants to track your assets internationally, and ultimately restrict what you can move and when... that's censorship.
The censorship issues you describe are describing people that already have money, so i don't know how these people don't follow in the above category. It sounds like these people don't want to pay any gov tax, well those are the kind of people that should stop using any of the services that society pays for using tax. They wouldn't go very far if that was to happen would they. I don't feel bad for them. If gov tax is such a big issue, why even live in society, money surely came to your pocket from society in the first place, you had to make it somehow, whether legally or illegally. So you definitely benefited. Essentially you are stealing from everyone in society when you are attempting to avoid tax or tariffs when moving your money out of the country. How much money do you really need man? The people that are investing in bitcoin are not living on a dollar a day.
Bitcoin is not for everyone and it does not make it easier for wealth to be distributed or aids upward mobility unless you count the early adopters which a lot of them just so happen to be insiders in the first place. Similar to insider traders.
Borders aren't going anywhere for a while. The real question is if these people have this money that are scared that it might be taxed or prevented from going out of the country. How did they make it in the first place?
The points you bring up have to do with people which do not want to support the society in which they live. They want to take more of the pie and bitcoin is an avenue for that at a larger scale than before.
I'm not looking for moral high ground here, but i just don't see how it benefits the regular population.
Ladies and gentleman, time to buy, it has been noted that suddenly bitcoin will solve the US health insurance problem. Right...
Smuggling will always occur before and after bitcoin.
People are happy to pay for internet service. If government was delivering value, then people would be happy to pay for it... alas, most of your tax money goes to blowing up brown people and paying off political allies than actually providing any services.
I always love the "if you aren't robbed as much as I think you should, you are stealing from me" argument.
Everyone who buys bitcoin today is an early adopter. We have not crossed the chasm. but we are getting close.
How people make their money is none of your business. And you legitimately cannot move large amounts of money outside the country without being spied upon. It's not a question of the source of the funds, but the government trying to control the flow of resources out of the jurisdiction as a result of their terrible management of the economy. That's what exchange controls are all about. Delaying the collapse of a hyper inflationary currency.
Yeah, you think people wanting to avoid theft are greedy, you're wrong.
You're not even responding to the healthcare point, misrepresentation isn't impressive.
Really sounds like you have a major axe grind, but I gotta tell you, buddy, so long as you go around thinking other people are your property to enslave you're going to have a bad time.
Bitcoin is liberating us from authoritarians like you.
For the record, i have no axe to grind, i could care less because i am not involved in trading bitcoin. Just want to understand it better and clear the smoke a bit.
Anyway, just a very interesting thing, because if you divide the total number of dollars by the total number of bitcoins, you get the figures above ($50 - $100 per coin) Which means, using my super simple maths, that bitcoin, as an international bank, is currently performing at 1/10th the cost :)
I think your math is off. Bitcoin is approaching a $100B market cap, and there are only 21 million bitcoins that will ever be in existence.
To match the dollars $20T total supply (a low end number depending on which money supply number you use it could be a multiple of that) then each bitcoin would be worth about $1M.
To match gold in market cap, would be $380,000 per bitcoin.
Truth is, though, when bitcoin comes into its own, the value of the dollar will drop (well, its true value will be realized) so prices would likely be much higher... assuming bitcoin succeeds and becomes a common world currency.
I was attempting to link USD in circulation to BTC, not paying attention to BTC market price. With your updated figures $21T USD in circulation makes each Bitcoin $1M yes, your math checks out. ($1M x $1M is $1T ... were we to somehow make BTC our new Cryptographic "Gold standard")
With each bitcoin worth $1M, that makes each Satoshi about ... a penny?
I don't really know what the ultimate value of bitcoin will be-- really determines on how well it resists attacks, and what level of services are built on top of it.
It's still the very early days.
Bitcoin is really a new currency, and comparing it to company market caps and banks sizes is not really fundamentally useful, but it is useful for giving an idea of the size of the bitcoin economy.
Gold has a market cap of $8T. If that's the use case bitcoin ever has, it will still ultimately be worth $380k each if it grows to bitcoins size... and it has several advantages over gold.
Is gold worthless because its "merely speculative"??
People don't seem to get this. Unlike Berkeshire Hathaway or any other stock, you don't have to buy a whole unit. BRKA shares at 6 figures are out of range for most people because you have to buy at least one whole share.
Bitcoin is divisible down to the satoshi-- 100,000,000th of a bitcoin. That's too small to transact in currently, but there's nothing stopping you from buying 0.1 or 0.01 bitcoin.