I live in a retirement town where many of the retirees have put their entire life savings and more into USI Tech. As far as I can tell USI Tech has properties of a classic pyramid scheme. I wonder how much this and other similar schemes are driving the price of bitcoin. I also wonder what will happen when entire towns get wiped out without recourse.
Have to wait up to 7 months to be able to get your money back out of USI Tech (they sell contracts that pay 1% per day for 140 business days) but the pyramid scheme will probably crash before then.
In my experience there's stark difference between those who got into the cryptocurrency culture at large, and those who just trust some specific platform/service to make them rich riding the Bitcoin wave. The latter group certainly tends to have MLM mentality and the services they use usually have all markings of a scam.
I remember buying a couple dozen BTC for $0.10, and thinking I was amazing when I sold all of the coins for a total of $20.
Still don’t regret it though because I know the next few years of my early 20s would have been spent tracking BTC like a bloodhound rather than spending that time on things I enjoy.
Then again I’m probably telling myself that so I don’t feel bad for missing out on 100s of thousands of dollars.
Approaching the final limit -> so many Bitcoins lost -> so many Bitcoins confiscated -> the amount of Bitcoins goes down -> the demand increases -> price for one Bitcoin goes through the roof.
At least that's how I see it. Don't know jack shit about cryptocurrencies, but this seems like basic economy.
About that, and I stand by it. Of course if I were some kind of psychic and could precisely predict the burst I’d be fuck-you rich. Seeing that I can’t, I’m not going to risk it all on tulips.
Especially tulips that burn through soooo much electricity.
So when you say that the bubbles skin is already taut, how many more times can the price double before you concede that perhaps it wasn’t so taut after all?
If it doubles again I’d be shocked at least, and certainly admit that I was laughably off about timing. That is possible, and betting against human stupidity/cupidity does have risks.
All those lost profits are the price of hubris my friend. I was wary of Bitcoin until it hit $4k, when I put aside my ego and reassessed its value, realized I was wrong and bought in.
The longer you go on trying to call peaks and slandering crypto as "human stupidity", the more cognitive dissonance will form, followed quickly by the rationalizations needed to dispel it.
Compare the current price action to that of November 2013 and try to say 'bubble' with a straight face.
Everyone in hysterics about a bubble is every bit as foolish as those shouting about going to the moon. We've had over a year of steady growth punctuated with regular corrections.
Will there be a bear market at some point? Certainly. But the proof of bubbles is in the popping; major price action down to a tenth of the peak or so. That doesn't just happen because of a bull market, it happens in the wake of a major speculative wave or something that fundamentally compromises value.
Buy a winning lottery ticket. Spending a little now to earn millions later- you'd be crazy not to! It's easy money!
Most people buy lots of lottery tickets that don't win. What a waste of money! What a bunch of suckers! If only they'd been paying more attention to the lottery tickets that won, they'd be rich now!
This lottery comparison is wrong and obnoxious. With the lottery you have a known chance of success (minuscule). With crypto you have some measure of control of your expected returns. Having foresight and the technical ability to judge promising projects goes a long way.
The ability to convert insights about the future success of projects into returns has always existed via self-directed brokerage accounts. That’s probably the closest analogy, except that crypto might not (yet) have skyscrapers full of people paid seven figures to know more about it than you.
Bitcoin Cash while derided by the Bitcoin Core camp as a, "pump & dump scam" actually has a lot of the original Bitcoin people behind it and undeniably has the goal of adhering to the original vision of economic freedom though cheap fast P2P cash for everyone.
Ethereum has the best fundamentals right now in terms of user adoption. It's transaction volume in terms of number of transactions is ahead of everything else out there. ETH has some technical risks though. It has uncapped coin issuance that is currently quite high ~14% and they want to switch from the proven proof of work mechanism to proof of stake and it isn't clear that will be successful.
Beyond that Bitcoin Core is crippled and everything else has pretty low adoption though some alts like Monero look like they might find a niche in dark markets where strong privacy guarantees are important.
So true. I did sell way too early and I bought too much later because I regretted it, thinking I’d rather lose what I buy it with than continue to regret.
I could have been a millionaire but I also could have had no BTC at all. I can’t say that I am happy that I later acted irrationally - to a degree it pisses me off that the bubble continues.
There's some story (that I can't find online now) about a group going on a 24 hour journey through a desert. Just before they enter the desert, a man says to them that in the midst of night, they are about to cross a river. "Take as many rocks from the river bed as you can. The next day, you all will be equally sad and happy at the same time."
The group indeed crosses a river in the night, and each of the party take a couple of rocks. Some just what they can carry themselves, some what their horse can hold.
The next day, when they leave the desert, they discover that the rocks were precious stones (or rocks with gold encased). And everyone in the group is comparably joyful about their new wealth, and comparably sad that they didn't take more rocks.
I held a bit of BTC back when it was worth a lot less. I mined some with GPU and then later heated my house with some BTC miners (that nearly paid for themselves with the proceeds before I retired them because the power and cooling needed made them uneconomical).
My coins were spread across a couple of USB keys and a hard disk, all encrypted with a passphrase I thought I knew but that didn't work last time I tried to decrypt the hard drive. The USB keys went missing. I think my girlfriend's cats stole them. The coins were worth a few hundred bucks when I lost access to them. They'd be worth...well, a lot more, today. The hard disk is maybe still functional and somewhere in my storage unit, though I probably still don't know the passphrase. The USB keys are probably gone forever, as I've moved house twice since I saw them last.
It's pretty frustrating, but I probably would have sold the coins when BTC broke $1000, anyway. So, I would have made a few thousand bucks, tops. Honestly, while I still hold a little bit of BTC, I don't really believe in it. It is an environmental disaster, the fees have gone through the roof. It is difficult to secure; everyone says "Keep it in an off-line wallet." But, I lost all of my off-line wallets. The only BTC I still have from back then is in Coinbase. Keeping a physical item really safe is costly or just annoying. You need a safety deposit box, or a firesafe, to be really sure of it. Since I live in an RV, there's not really any way for me to be confident any coins of significant value in a physical wallet would be safe. I wouldn't keep a physical wallet with me any more than I would keep significant cash under my mattress.
Bitcoins aren't backed by anything or to anything. Whether it's worth 1 dollar or a million dollar makes no difference, it's our perception that gives it value. Plus they are limited unlike Fiat currency
I always posit this question, to which I have never received a satisfactory answer: What, exactly, would the US do if the world suddenly decided that the dollar was worth nothing?
Massive buybacks of dollars by the Fed would be seen as an ineffective and desperate move. Besides that, what other recourse do they have?
I'm not sure that you realize that the current monetary system is only about half a century old. Fiat currency, backed by nothing except the government, has only existed since the 1970s.
But it’s a pretty far-fetched hypothetical scenario. You could also ask, what would happen if all of a sudden everyone in the world decided that food had no value? Gee whiz, all the farmers and restaurant owners would be screwed!
One reason might be because this gives the US too much influence over the world (I know I am oversimplifying here). As long as everybody got along well, and most of the countries in the world were growing economically, the dollar served a common goal. But now we are increasingly heading towards a world where trade wars are common and policy makers are looking inwards rather than outwards. Perhaps all the armed conflicts that US has gotten into also lead to more ideological misalignment in the world.
So, in such a world, I wouldn’t find it so surprising that certain countries would like to wean themselves of the dollar. Of course, this it is more important for powerful geo-political actors like China and Russia, than Somalia (uses USD extensively), and as an example you can look at how China is planning on offering a yuan priced oil contract that is backed by gold.
The US dollar is backed by its military and government. In practice, while the US can reduce supply by buying dollars like you said, it can also increase demand by incentivizing buying US currency (say by raising interest rates, or requiring certain transactions to be done in dollars).
Economically the US is very well positioned - it has friendly neighbors, a robust legal system, a diversified industry and a lot of natural resources, so it would take quite a bit for hyperinflation to occur. Obviously anything is possible, though.
> You gonna force people to buy dollars at gunpoint?
It's only a slight exaggeration to describe taxes like that. There are huge amounts of assets held under the jurisdiction of the US government (probably somewhere north of $100 trillion[1]) and a huge number of people who live under the jurisdiction of the US government (>300 million). If the owners of those assets or the people living in the US don't pay their tax bills, the government can resort to seizing their property to cover the tax bill or jailing the person who didn't pay. If they don't cooperate with that action, the government can send people with guns to force them to comply. Effectively, everyone who lives in or owns property in the US is forced to acquire dollars to pay their tax bill.
One example of this is the US collecting taxes in US dollars. Why not let me pay my taxes in Euros or gold (or bitcoin :D)? And there's the threat of violence backing this. If I refuse to pay my taxes in US dollars, I'll get some angry letters, I'll have my property seized, and then I'll get some police officers showing up at my door - and if I continue to resist, I'll either be arrested or killed. For refusing to pay my taxes in US dollars.
Likewise, US dollars are "legal tender for all debts public and private". If someone (in the US) refuses to accept US dollars to consolidate a US debt, they will be arrested or killed (after several opportunities to course correct) and their property will be forcefully taken.
And for a third example - consider someone trying to set up an unregistered company in the USA. If they get on the government's radar, what do you think their long term prospects are?
Fortunately, our legal system and general social beliefs mean that it rarely if ever would come that far. But the threat of violence is real. And think - without that threat, however far removed, why would anyone pay their taxes or follow most laws?
The backing of the USD is the most powerful military the world has ever seen and the richest economy the world has ever seen.
Why would the world suddenly not want in on that?
When Zimbabwe destroyed its currency the real killer wasn't leaving the printing presses on (it was too late by that point) it was the systematic destruction of its agricultural industry.
They would do the opposite of quantitative easing: jack up the Federal Funds rate and reverse open market operations to pull liquidity away from banks. Higher interest rates would encourage people not to dump USD, while also counterbalancing the cheap-money boom created by the influx of USD.
If the influx of USD was higher and faster than could be addressed, the economy would naturally get inflation that would force interest rates even higher up (since no banks will lend at a loss, so borrowing costs get pushed up first by the fed, and then by the need to cover for expected inflation). This would be a death blow to many indebted and highly-leveraged businesses that are dependent on low interest rates for operational purposes (including those in the financial sector) and so they would go out of business. The need for the financial system to write-off the debt held by these companies would also eliminate a certain amount of money in circulation. Eventually enough money has been destroyed/absorbed and the economy is back in equilibrium.
On a less than academic note: this is not a totally unlikely scenario since the flight-to-crypto is a de facto process of de-dollarization, with crypto assets essentially replacing fiat both as store of value as well as medium of exchange. Put another way, the increase in the value of cryptocurrencies is really just a loss in the purchasing power of everyone holding fiat, and since these additional assets are now competing to purchase the same pool of goods, what people think of as bubbles in assets like housing are really just reflective of inflation in the underlying supply of money-that-can-buy-things. And it will get worse when you can sell your house for crypto.
Iraq was invaded shortly after Saddam attempted to switch from USD to Euro for their oil exports. I’ve heard various theories for the ultimate reason for the war and of them this one seems pretty convincing.
If you mean the people of the US still value the dollar, i don't think it would be a huge hit.
People will scoop up all the free dollars, and bring them back to the us where they have value.
Contracts still have to be paid in dollars. Some people around the world would be upset that their dollars are worthless, but it turns out they could sell those dollars to people who need to pay debts in dollars. So suddenly this valueless piece of paper has value again, because you can trade it for things you want.
if you can in an instant impose some irrational condition for an instant, i think the global economy will, certainly shift, but people would notice all of the arbitrage opportunities and things would _generally_ go back to the way they were, like a flash crash.
if you could wave a magic wand, and make people think the dollar is worthless for 10 years? That would be weird. i imagine we'd make a new currency, dollar2 and just pay everyone in that. you could bring in old dollars to the us and exchange them for dollar2's. But because people are under a spell, they can't think of the arbitrage idea. so it only happens accidentally.
The hard basis of USD is printed on the bills. “Good for all depts public and private”. This means that any bills owed to USG is payable in dollars as well as any payment of debt ordered by a court. I agree that the worldwide value is largely theoretical but the non theoretical value is large in a several trillion dollar economy. If the dollar goes down, it is guaranteed to be useful to buy us companies and land. That has a strong lower bound.
Let's imagine the entire rest of the world thought that the dollar was worth nothing. Well everyone in the US still needs dollars to pay their taxes, so they'll still want to get their salaries in dollars. Similarly, people will sell stuff in dollars too. Now if someone outside the US wants something that someone in the US produces, they'll be able to get it really cheaply by trading their valuable currency for tons of dollars. They'll do that, buy stuff from the US, and make a huge amount of money. This obviously presents an upward pressure on the dollar's value, until the cost of things from the US more or less balances out.
As long as there's a base of goods/services that can be bought and are priced in dollars, dollars will continue to have value.
You might as well ask what would happen if the world suddenly disbelieved in anything else that's just a social construct -- property, authority, family, etc. It's a fun and perhaps enlightening thought experiment, but not much practical use.
While it is up for debate if certain abstract characteristics of BTC give it value (such as its scarcity, its usefulness and what not) you can certainly say that BTC is backed by the power required to mine it.
That's incorrect. The price of creating a thing does not determine its value. If there is no demand, then it is worth nothing no matter how hard it is to create.
To be crude, human poop takes effort to create, but the worth of it as a tradable good is significantly less than the effort involved.
The cost of mining bitcoin is dependent on the value, not the other way around. This is because the rate of creation of bitcoin is essentially fixed. If the price rises, mining becomes more profitable, so more resources go into mining, but the difficulty also increases. So the same amount of bitcoins will be created, but the energy cost of mining a bitcoin will increase proportionally with the price.
about a year or two ago. in one extreme case, somebody maxed out their CCs and used their student loans to invest in eth. He was a bit on the obsessed side.
I don't know where you're based, but for me (NZ), I get redirected to gizmodo.com.au. I see $12k as well, but I'm guessing that's in AUD? Looking at BTC price graphs it seems the most recent peak was at about $9500USD
I've been playing with Bitcoin since 2010, the first price I remember was $0.10 a coin. I even did some CPU mining (!). I have never seriously invested in BTC but I've been paying attention.
It's amazing to watch the price go up as utility has gone down. In 2012 or so Bitcoin was legitimately useful. Coinbase was around so it was easy to buy. You could move it for reasonable fees / transaction times and it gave you access to Darknet Markets which offered services you couldn't get anywhere else. We also believed it to be private because law enforcement had not yet developed any block chain analysis software. Bitcoin was the only credible coin, everything else was a joke or lacked critical mass.
Now none of that is true. If you're interested in privacy you don't touch BTC with a 10 foot pole. If you want an actually usable currency with speed and low fees you use ETH or any other. And if you're a financial institution you're looking at Ripple. Oh and let's not forget all the BTC forks and exchange hacks.
Yet the price just climbs and climbs, and many people are getting quite rich. I can't say I'm not jealous, but I still won't invest because the fundamentals are all wrong. Someone will be left holding the bag.
Other coins are less hacked (or, only BTC is stolen) because it makes most sense to steal it.
While it’s true that it’s less private and useful than it was, there are developments that will make it better and some are in testing now (such as LN).
It is a bubble, but it’s anyone’s guess when this madness will stop. There’s relatively few BTC out there.
Like many others I regret I didn’t hold onto BTC I once had...
Not backed by banks is Bitcoin's primary value proposition.
Ripple will find a use and may do quite well. But it requires more trust in a few centralized parties. It won't replace Bitcoin's primary use case as the highest security value store and world-wide settlement layer.
Bitcoin effectively requires trust in a few centralized parties. The parties may not be set by fiat or syndicate, but the extent to which Bitcoin is truly trustless and decentralized in a way that is accessible to normal people is greatly exaggerated.
I hold a small amount of XRP. It's not even a true Cryptocurrency as we commonly think of them but it's a nice piece of tech with good momentum in a space that could sorely use some efficiency gains.
No not at all. XRP is part of the Ripper network which is a centralized payment network run by a single company. It's mostly used by banks. It's going for speed and volume not privacy, decentralization, or growth.
According to a summary I read a while back, Ripple the company has a fair chance of success, but that doesn't mean it's a good idea for you to bet on the appreciation of XRP. IIRC the company keeps far more of it than they've put on the market. I haven't looked into this myself.
What remains of Ripple now is awfully similar to a scam: Jed McCaleb has been selling thousands of coins a day, and duped noobs are the only ones buying it.
In 2012 or so, the block size limit was 500 KB and blocks weren't close to being full; towards the end of 2012 they were approaching 100 KB each. The current block size limit is 1MB+ and almost every block is stuffed to the limit. It's easy to lose track of the fact that the reason fees are high is because there's a lot more on-chain activity than back in 2012.
What's more interesting is that, for example, Bitcoin Cash has a similar level of on-chain activity to 2012-era Bitcoin without the interesting shops accepting it, but its price is about a hundred times higher than 2012-era Bitcoin.
All true but that's just proof that BTC doesn't really scale to the point where it's a useful global medium of exchange.
That's an interesting way to think about BCH. Some of the price increase is justified due to the increasing legitimization of all crypto currencies but definitely not 100x.
I am not going to throw allegations out, but I believe there will be a day in the coming years where we read stories about organized crime and pump and dumps in this space. I believe the bitcoin forks will be at the heart of this all.
Everybody is happily singing the song of crypto while the music is going. Not sure how long it will last.
Why Bitcoin forks? Exchanges would be where the fraud happens. MtGOX was insolvent and yet they inflated the price of Bitcoin across all exchanges. Bitfinex is alleged to be engaging in the same market manipulation through margin wash trades and their central bank scheme of free Tether minting.
Bitcoin forks are funny because it's decentralized software with a shared database history from the time of the fork. After an update, users can choose to use one or the other. Unfortunately the incentives are warped for miners and devs, so users might not have the best possible design.
There's an excessive amount of propaganda surrounding cryptocoins because "investors" need to psychologically lure you in to buy their supply, which they've acquired for significantly lower value, lower capital, and lower computational work then you if you're starting after them.
Because supporters of Bitcoin Core want to dis-credit Bitcoin Cash and the way they are doing it is by promoting a bunch of increasingly scummy Bitcoin forks. Then they say hey look these forks are all scams. Bitcoin Cash is a fork there for it too is a scam. Nothing could be further from the truth though.
Agree, bitcoin cash from my experience has been more useful than bitcoin. I was able to send bitcoin cash without any fee at all and was able to get it confirmed in the next block mined.
It looks like bitcoin cash is going to be extremely useful for doing daily type transactions (ie. low dollar transactions etc.)
Ver rode the Cash band-wagon to help his position of control over the ecosystem, as did many others. Hundreds of millions of value was created — and a lot instantly lost — in a day. It's been pumped over and over again by mining pools looking to make a quick buck while the difficulty is low as well.
That is where the "scam" lies. It isn't discrediting BCH — BCH already did that to itself.
Here is an example of a typical clueless Bitcoin investor with irrational hate toward a prominent player in the space who did nothing more than express their genuinely held opinion.
Well, good job at assuming incorrectly. You wouldn't know by my comment that I've been in the space since '11, or that I've contributed to the codebase (however slightly).
Nope, you just see a completely pragmatic view of Ver's actions as an attack, probably formed on the r/btc sub (that he mods).
I love how you say "completely clueless" too — because it's ironically you.
Because forks were necessary for their plan. The exchanges we're definitely in on it. Adding futures for forks? Is there any doubt that they were colluding?
It's not happening because of forks per se. I think the weak link is Tether. There are already signs of a lot of shady shit going on with disappearing funds, essentially capital controls, etc. The exchanges are the ones perpetuating this and once people find out the whole crypto market might crash - which would be a shame because it could set back crypto as a whole by quite a bit
Funny, I was working on a research paper for this Ethics class talking about organized crime, and how they made movements into cybercrime (credit card, ID theft, etc). What popped up in my head last week was with the whole USDT/Tether Tokens, there has to be a good chunk of cash getting into these networks that is dirty. Cycling around in the various networks will get easier with Atomic Swaps / SEGWIT...
Far fetched idea is that these networks were designed for this type of washing. Clean and Dirty money enters in, someones bound to walk at some point.
True but Bitcoin can't just blame its activity level for the high fees, since Ethereum does twice as many transactions per day and charges under a penny for a simple coin transfer.
Same boat as you -- I wanted to buy some in the early days but ultimately didn't for various reasons. At the time, it was an experiment.
But today it's becoming more and more clear what it'll eventually end up being: not a payment network, not a private way of transacting, but digital (yet secure) gold. That's all Bitcoin will most likely ever be and that is totally fine.
There is something to be said about an asset that is held outside of the traditional financial system. I'm not a Bitcoin bull, but I also wouldn't be surprised if a coin hits $100,000 (or more) sometime in the next few years.
Ethereum though.. I'm more curious about how that will turn out. Seems to have many potential interesting use cases
Is gold a good comparison though? Gold has value beyond fiat in manufacturing. If Bitcoin cannot provide value for exchange then why would it be a better store of value?
and clearly as you've just proved, a good store of value does NOT require an intrinsic value. All that is important is that people place trust in the asset. Bitcoin and cryptocurrencies have attributes that make it easy for people to place trust in it.
The fact that people trust in something doesn't automatically mean that thing is good, remember that many people (even the same as those who put their trust in *coins) also trust in sky wizards and celebrities. I realise you may just be stating that that's how the world is.
Trust here is in the context of assets used in trade, not in literally anything people can have "trust" in.
They're stating that "intrinsic value", e.g. gold being usable for things other than trade, is not necessary for a tradable thing to have value. It is only necessary for people to be able to trust that the thing has value and having "intrinsic value" is one way for that trust to be gained.
With cryptocurrency, it's gained with a bunch o math.
Gold has value beyond store of value, but not nearly as much as you would think. A lot of what makes gold valuable is people's faith on it, and in that sense it's not significantly better than bitcoin. That's not to say that bitcoin prices are reasonable, but just that there's an irrational component in almost everything.
Unfortunately, it does not. There's 2 kinds of Gold people invest in.
The non-loony ETFs, Swiss vault storage, etc. Let's simplify to "the GLD ETF" [1]. This of course isn't really gold, it's paper gold (and has in fact been fractional-reserve-banked: there is far more paper gold than actual gold).
The loony gold storage: gold bars under your pillow. Unfortunately, the gold people use for payments is extremely regulated, specific grades of gold, guaranteed by a very small number of financial institutions (and numbered). Whilst at least these are obviously not oversubscribed, if you have one you can't sell it (aside from the subdivision problem), because there's no easy way to verify the guarantees, and there are an untold number of fakes in circulation.
As long as people like it as jewelry and are prepared to dig it up the price of gold will approximate the cost of digging it up as it has done for 2000+ years. Bitcoin doesn't have that.
When the lightning network is completed, it will effectively re-enable the use of Bitcoin as an ultra-low-overhead transaction mechanism. Right now, Bitcoin is only cost-competitive with credit cards for reasonably large transactions, on the order of $70-100.
Even at that amount it's not really worth it. I paid with Bitcoin for a $70 purchase the other day and paid $2.50 in fees. I won't do that again. Compare that to the past when my fees would be less than a penny and not worth worrying about.
As for lightning network, let's wait and see once it's actually completed. Can Bitcoin afford to wait that long? The core developers are taking an awfully big risk when Bitcoin cash had shown that bigger blocks are not an issue.
It takes 90-180 days for a credit card transaction to clear, while it takes a bitcoin transaction ~10 minutes. You’re comparing the wrong thing. Retailers typically just eat the CC chargeback fraud costs, while bitcoin stores don’t (because the transaction clears pretty fast anyway).
In my 'speculative' investments I have some crypto and have more ETH than BTC. I think ETH just has more utility, but it is missing the name recognition of BTC.
Who knows...the crypto that wins out might not even be invented yet.
Seems like a bit of a double-edged sword to me. On one hand, it becomes less likely that a single party or exploit would be able to damage the entire ecosystem (because distinct currencies aren't likely to have exactly the same flaws). On the other hand, AFAIK, smaller networks are generally easier to attack, making it more feasible that it will happen.
Because many different groups bought into many different viable systems in the same time? Isn't that why many countries in the world use their own currencies?
Not necessarily one, but as crypto matures I fully expect consolidation down to a few with each specializing in some aspect. 50 feels too large except for some niche uses, but again this is a bit of uncharted territory.
I think people aren't as rich as they think they are. Let them try and cash out the bitcoins on bitfinex and discover that what they actually get are funny-money tokens called 'tether' which they can't exchange for dollars anywhere.
Kraken is the only exchange where you can actually exchange USDT for USD. However, at the time of posting, you can only redeem 320k Tether before the price of it will half. Only 320k out of 650M+ (and growing) has any real value. Where are the remaining 649780k USDT going to be redeemed for USD? (Hint: Not from Tether themselves, they clearly state in their own terms of service that they're not redeemable for USD).
I like how you just sort of blithely say that tether is a scam when there’s nearly a billion dollars of it trading on margin, inflating the bitcoin price.
I haven't traded any BTC for years, but when I did, I was using Kraken. Why do you think Kraken isn't more popular now? It seems to be the least shady of the exchanges.
When you try to place an order on Kraken it 100% of the time on the first try gives you some generic message that says something like "We're not sure if your order went through. Check back later." So you wait a bit, refresh, and it looks like it hasn't gone through, so you enter it again. You get the same message 5 times in a row. On the 6th try, your order goes through. Sometimes you end up with 2 orders going through because one you thought didn't go through just took longer than you had the patience for.
I'm being completely serious when I say this isn't something that happens occasionally; it happens every time.
They say they're working on a new engine or something that should be out in a few months, but it's a known and annoying problem for now. Other than that, I like Kraken and agree that it seems less shady than most.
I've been sort of following the situation, At least they are protected against a bank run because they don't do withdrawals, only deposits. I think that at a bare minimum, if they are doing exactly what they say they are doing with no mistakes, they are extremely vulnerable to getting a bank account frozen.
Only if they cash out. You need new investors to be able to cash out. The wise ones smell the crash and are the first ones out. Some make it out just before the crash when the party is still going but the fires are rising. The rest burns. There is no real value in bitcoin (unlike the stock exchange or fiat money where valuable people are trapped in contracts).
Eh, the value is being able to buy drugs and exploits and botnets and ransomware unlocks online and move money between countries without delay or paperwork or reversal.
If you're a CTO of a major company and you don't have a wallet with at least $1m in BTC in some wallet somewhere then you're risking a major disaster if someone breaks in and locks up your data.
But just because there are real uses doesn't mean that I think that the government will allow it to remain legal.
Right but there are better cryptos for all of those purposes (Ethereum, Monero). Right now Bitcoin's only killer app is the name recognition and the fact that it's increasing in value, which is tautological and why I think it's bound to decline in importance compared to other crypto.
I think you're underestimating the power of network effects and critical mass. Even when a product (or protocol) has major flaws, it can be an insurmountable obstacle for potential competitors, regardless of how much better they might be otherwise. Bitcoin is going to be extremely difficult to catch on this front unless it has a true meltdown or there's a fundamental shift due to legislation.
That's fair, but while my 19 year old younger brother has heard of Bitcoin and not Ethereum, the same is not true for developers. I think there is some information asymmetry and a discrepancy in the quality of the users between networks - by quality I mean how likely users are to contribute to new software to make it better, the level of what is essentially corruption/bureaucracy in making changes to the platform, etc.
Facebook and Snap did well because they were "cooler" than their predecessors, and they had different/more uses. I think that's analogous to where I see the future of crypto
There's no "wise" people in this type of speculation, only lucky ones.
There have been plenty of crashes until now, and those who "smelled it" and sold (I did) lost lots of paper profits.
There will be other crashes for sure, and it will be impossible to know if it's the BTC Apocalypse™ or the BTC Yearly Crash™ until late in the process.
Unless, of course, one belongs to the BTC-illuminati.
Yep. If you get out now, maybe you're a genius, because it crashes tomorrow. Or maybe it goes up to $30k on continued hubris, and you're the dumbass that sold early.
What do you mean by "cash out"? Everything that you own can go to zero: cryptocurrency (obviously), fiat money (hyperinflation, see Zimbabmwe now), real estate (see what happened in eastern Europe when the Russians came).
I agree that each asset class comes with risk, and that euro and dollar is currently less risky than crypto. But remember that each has its own risk. Fiat money goes down at about 2% each year, if you're in a proper economy. Did you see the quantitative easing that was done on the dollar? Scary.
Some people are even "cashing out" to expensive real estate I read, not dollars.
Don't make the mistake to think euro's or dollars are the unit of value, they are not. Their price goes up and down just like everything else. History was not kind to fiat money (see French revolution for example).
Bitcoin is in a position to compete with central banks and commercial banks with fraction reserves. The chance of crypto really getting that far might be low, but it is still there, don't forget about that.
Nobody can be certain of the "bitcoin bubble", and nobody can be certain of the "worldwide bitcoin takeover of fiat money". Maybe it will end somewhere in between. It's all chances. You have to play on the risk factors of each, not on "I believe ...".
You don't cash out, you properly organize your assets.
> It's amazing to watch the price go up as utility has gone down.
Couldn't agree more. I've been following crypto since 2012. The most exciting aspect of bitcoin personally was being able to hold both cash(private/low fees) AND and an asset(scarce) on the internet without having to trust any 3rd parties. Sad to see the community is just settling on the latter (at least for now).
I don't think there's a need for two different currencies to represent both 'cash' and 'asset'. I think in the future it'll most likely be one crypto that fulfills both needs. And as of right now, I wouldn't bet on Bitcoin.
I don't like these "paper rich" comments. Why? Because the vast majority of people who hold BTC can market sell their coins now without affecting the market.
Your statement, from my understanding, is saying "if people cash out, everything will crash". That's simply not true. More so, it's not true because that's fundamentally not how markets work.
Whenever someone buys 400 BTC, that means someone else sold or "cashed out" 400 BTC. This is a highly liquid market system with many participants, not a lottery system.
> Your statement, from my understanding, is saying "if people cash out, everything will crash"
I never wrote that. I've been quite specific:
> BTC may be toilet paper tomorrow, or maybe not; and this is how lotteries work.
The difference between wealth and "paper wealth", in this interpretation, is simply in the volatility of the assets.
BTC is extremely volatile both in the short and long terms, therefore being rich can't be disassociated from the cash out.
Association is the concept I'm stressing. With lowly volatile assets, one can be reasonably confident the value of the assets, so cashing out can be reasonably ignored, but with highly volatile ones, one can't, so it's all about the moment of the conversion.
Lottery has probably been a wrong term - probably gambling is better, but the concept still stands.
It often feels like I'm the only one on the planet who genuinely doesn't want to make money off bitcoin. It's a pretty satisfying perspective, though -- I don't feel jealous of anyone who has or will make a killing off bitcoin speculation. I don't want it to fail and I don't really care if it succeeds. To me it's an interesting phenomena which is just as likely to be the most important creation in a century as it is to be a temporary fluke/bubble which won't stand the test of time.
Running around hopping on popular ideas, foaming at the mouth fearing to lose out is an unpleasant mental/emotional state of mind IMO.
Consciously avoiding FOMO is something I also try to do. Takes a certain amount of mental discipline, but reduces stress significantly (for me, at least).
>...but I still won't invest because the fundamentals are all wrong.
Trading bitcoin is speculation. It's not investing (where fundamental analysis can be useful to evaluate assets). But a lot of money can be made (and lost) by speculating. It just depends on your risk profile.
The utility has gone down? Bitcoin utility hasn't gone down it has had many additional features built into it but the utility has not changed.
The fact that this is upvoted so high really shows the number of people who truly lack an understanding of an asset but are vocal in spite of that fact.
My pastor asked me about Bitcoin yesterday, and if he should buy some. My pastor, who did the math and realized that it doesn't make financial sense for him to own a car on the little bit of money he makes working for various English-speaking churches here in Germany and teaching, and is not a greedy person (otherwise he wouldn't be a poorly-paid mainline Protestant pastor...)
At least he understands that he doesn't understand how on earth it works and that should be grounds enough for caution.
If I didn't already have problems with how much electricity it burns for even the smallest transaction, that would have been enough to put me off it.
I apologized to him for possibly being wrong about warning him off from what looks to me like an enormous bubble, but from what I've seen outside of our own tech bubble, it's an enormous bubble that most of the buyers have little to no understanding of.
I made 1300% on Nvidia stock purchased in 2009, after that court ruling. I'm content with the money I've indirectly made off Bitcoin.
I respectfully disagree with your assertion that "the fundamentals are all wrong".
I can't really think of many reasons why you would use crypto to pay for a coffee or a sandwhich if you live in the West (or frankly, even most developing nations).
On the other hand, I can definitely see the utility in a censorship-resistant digital medium to store wealth. To me, this latter use case has much, much more potential to serve the unbanked (as well as the banked).
Some use cases I can think off the top of my head:
(1) You are from Syria and need to flee war and escape into Europe – however bank transfers into Europe are almost impossible if you are a common Syrian. Bitcoin allows you to take your wealth with you, in your brain, as you escape across the border, by just memorising your twelve word private key.
(2) You are from Venezuela or Zimbabwe – The government has issued capital controls and is devaluing currency by the day. You transfer your wealth into Bitcoin in order to offset capital erosion due to hyper-inflation. When the situation stabilises, you transfer your Bitcoin back into fiat.
(3) You are Saudi billionaire Al-Waleed bin Talal. The government freezes all your assets in a political coup. If you have a portion of your wealth in Bitcoin, you could protect them from government expropriation and anonymously transfer them to associates or family members abroad.
(4) You are whistleblower Julian Assance and have been cut off from the financial system as a way to censor your speech. Bitcoin allows you to have an unbreakable digital "Swiss bank account" that the authorities are not able to reach.
This reminds me of Peter Thiel's recent words about Bitcoin: "it's like a reserve form of money, it's like gold, and it's just a store of value. You don't need to use it to make payments."
Is Bitcoin a bubble or not? No one knows for sure, but it reminds me a lot of the 2000 dot-com bubble, when Internet companies were overvalued like crazy. We had basically the same selling line: it's a new economy, a new paradigm, an exponential growth, you better join if you do not want to be left out, it will rocket to the moon, and so. I fear it will end up badly for a lot of people in Bitcoin. Make sure you exit before you end up with nothing.
You can look at it the other way, the dot-com bubble happened under huge speculation that we'd "live on the internet" and the huge potential of e-commerce/marketing but the tools available were still not finely-tuned and the internet speeds were also lagging behind.
But now that we have widespread adoption of smartphones and high-speed internet(still lagging behind in some countries), plus a plethora of tools to build apps and track, analyze and influence user behavior, tech companies are some of the wealthiest and most influential enterprises on the planet, two of them even survived the 2000 bubble(GOOG and AMZN), IMO, far beyond the imagined potential of dot-com predictions.
So I partly agree with you, I think there are some extreme expectations on BTC and a major crash seems possible, but who knows, maybe technology will enable BTC or some other cryptocurrencies to thrive the same way the internet recovered from the dotcom bubble burst.
The entire market cap of crypto is around $250bn at the moment. The .com bubble went up to $6.7 trillion before correcting back down to 1.7tn. In todays dollars that's close to $8tn.
One can only hope this will be "the next" .com bubble -- there will be money to be made. Given the amount of liquidity that was pumped into the market by the fed, it will be interesting to see what stops this train.
The more and more you look around, money isn't worth anything anymore. Like that recent Leonardo Da Vinci painting that was sold for $450m. Assets and companies selling for a 10-12x multiple, excessive property prices in prime locations, etc. Asset prices have been driven up significantly across the board.
Yep, it's like Fiat currency is some crappy thing poor people use to live on while the rich accumulate actual scarce resources with infinitely appreciating prices.
There are advantages as well though -- for those being able to create assets (companies, profitable products, etc), those will generally sell for a higher multiple than before.
I guess it depends on if you see cryptocurrencies as a way to make money in the short term or if you see cryptocurrencies as the future of money. I'm firmly in the latter camp and am not looking to ever "cash out".
Until bitcoin has real utility, it has to be a bubble. All the dark web stuff can't be a constant driver of price. Most people are gambling with no intent to participate in the dark web.
A currency with a perpetually ascendant value (or perceived value/price) has little value as a currency - people will be strongly disinclined to spend it.
So what's left but a token that has no underlying value other than a proposition which can largely be discounted?
I love Bitcoin (and the broader ecosystem). The promise of great riches if you can survive long enough in a lawless new world, navigating the schemes, scams and intrigue and the government besides. It must be a glimpse of what got people to pack up and and head west for the gold rush.
The mysterious author, watching mtgox grow, collapse and subsequent revelations, "we found Satoshi" debacle, the DAO heist and reaction, altcoins, block size schism, ICO's, segwit activation, segwit2x deactivation and bugs, Teather's "theft", this rally ...
Chinese mining pools, Russian hackers, the dark web, struggles for control; it's like living in a Neal Stephenson novel. Worth the price of admission just for the entertainment value.
And that's why I've recommended to people that they buy even just a little bit to be part of the craziness. Even just $100 that they can afford to lose. Maybe it's tulips, maybe it's not. But it's incredibly interesting to watch unfold regardless.
You, man, said it right!! I am just invested with about a thousand Euros in the crypto world, and I mainly did it for one reason: I don‘t want to be last in the game and get some hands on experience. But mainly, I just want to be able to tell my grandchildren one day about that crypto craze that occured in about 2017. Its crazy, irrational, completely new and that is why I love it for that moment in my life.
If you reread some of Neal Stephenson's novels right now (namely Cryptonomicon and Reamde) it's remarkable how well he conceptualized cryptocurrencies long before their arrival. He obviously got the specifics wrong - his cybercurrencies always rely on an authoritative 3rd party, for instance - but he got the use cases, the culture and the impact spot on.
"The promise of great riches if you can survive long enough"
Except that there is no net new value being created - and it's a zero sum game. So any 'riches' you make are from some suckers pocket.
No thanks.
The Valley and tech works because we are doing a lot of non-zero sum game stuff. Whenever anyone invents/creates something new - we can grow the whole pie.
Yes - I see how it could be considered fun ...
But most of the 'riches' from the 'Wild West' went to those who were just willing to be the most brutal.
You're completely wrong about crypto being a zero sum game. Wealth is created in crypto the same way it's created in the stock market, with changing perceptions and opinions on value driving the underlying asset's value.
I'm afraid you don't understand the difference between a stock and a crypto currency, nor where the bulk of value is created.
A) The bulk of value in capitalism is not created via the exchange of shares - it's created when people 'do stuff, make stuff and invent stuff' - yes - there is some value creation by financial activity, but it's not the bulk.
Crypto currencies - if they were actually used as currencies - would provide some value. But i) they are not being used as currencies - and ii) they are certainly not being used to the point wherein they should be having a $50B valuation/cap.
It's wrong to suggest that BTC has created $50B in value for civilization.
B) Your point about valuation is wrong.
Stocks can be valued in a number of ways, but ultimately they are worth the present value of all the assets the company has - and will have. Why? Because stocks are ownership. The companies bank account is de-facto owned by shareholders.
Crypto currencies cannot be valued - they don't have anything underlying them - they do not imply ownership of anything - and especially since they are not used as currencies - their valuation is a total fantasy.
BTC is worth whatever the next guy thinks it is worth - and what he thinks it is worth is pure speculative fiction. Just a function of emotional dynamics and fad.
A stock in 'Bank of America' - well you can calculate how much assets they have, and estimate how much you might think they will earn in the future. There will be disagreement over that hence fluctuating value of prices ... (and BTW it's good that we have a lot of people trying to figure out how much BofA is worth - that provides value).
At least as of today - all crypto currencies are a fiction. They are invented numbers that others are duped into paying money for. They are generally not used as currencies, and so ... 'there is no 'there' there'. Even thought it's really interesting from an academic perspective, and something may yet come out of it.
However, there are a whole class of stocks where the stock price is based on nothing more than perception of value. There is almost zero actual, intrinsic value. You see this often with penny stocks (and even larger companies, back in the dot-com days.)
The value of the bitcoin network lies in being a censorship[1]- and capital-control-resistant store of value. That is a social net positive, like investment in the equity of productive ventures (except for different reasons). As more people use bitcoin, it becomes a more effective store of value and thus represents a further social good (modulo the increase in legitimately criminal stuff it facilitates!). Perhaps not exactly $50 billion worth, but value nonetheless.
>Crypto currencies cannot be valued - they don't have anything underlying them - they do not imply ownership of anything - and especially since they are not used as currencies - their valuation is a total fantasy.
>BTC is worth whatever the next guy thinks it is worth - and what he thinks it is worth is pure speculative fiction. Just a function of emotional dynamics and fad.
Isn't that equally true of any currency? It doesn't pay dividends and doesn't guarantee ownership of anything, and rises and falls based on the whims of the market. At most you can say that legit currencies are "ownership" of "the cancellation of X units of tax debt", but that's somewhat circular: there's no guarantee that "X units of tax debt" will be a large burden in the first place, and will itself fluctuate in value with the market.
[1] It's true that bitcoin has many failings at achieving anonymity but it certainly competes with international bank transfers for many use cases.
Necessary disclaimer: I'm long bitcoin and and author of understandingbitcoin.us.
How can something as inimical to privacy as Bitcoin be resistent to control? Direct and technical, maybe not, but China for example seems to work around that.
Right, it's an open question how good it will actually be at achieving the goals people want, like privacy. I don't have a firm reason to believe China will be successful or not. My point was just that there are legitimate reasons to believe Bitcoin will be valuable for non-bubble reasons and will not substantively differ from legit currencies in supporting a valuation.
There is some intrinsic value to BTC, and that is the value of using it for transactions (e.g. because of untraceability, to pay for black market goods). That value is small compared to the overall price of BTC - which is mostly speculative - but it's non-zero.
And many stocks are similarly overvalued by orders of magnitude compared to the actual assets the company holds, to the point that saying that it's "how much they will earn in the future" is meaningless. People buy those stocks because they hope to sell them at a greater price to other people and cash in on the difference, just as they do with BTC.
Value is created by destroying friction: if financial transactions become decentralized, cheap and fast, you already have created some value.
Even more: having the masses controlling the capital would allow for novel allocation of financial resources: nobody would have killed the electric car 40 years ago if research capital had been more distributed (just an example, not trying to bring up any specific conspiration theory).
More applications, taken from git: before git took the development world by storm, everybody was pretty much used to cumbersome and slow merges when doing team development. Once a fast vcs tool appeared, the possibilities multiplied, and whole new industries emerged. A couple of simple features (speed, low cost, easy setup) where enough to create a miriad of new applications.
Money being at the base of everything, from economics to politicis to science, the blockchain is poised to revolutionize society as no other technology has achieved before.
" if financial transactions become decentralized, cheap and fast, you already have created some value."
+ There is no evidence of value from a 'decentralized' system - in fact, there's considerable value from a managed currency which we know will expand as the economy needs it - not an some arbitrary and ridiculous parameter such as the availability of computing power.
+ Most monetary transactions are already cheap and efficient.
"having the masses controlling the capital would allow for novel allocation of financial resources:"
A) BTC in no way enables 'the masses to control the capital' - it's probably more concentrated in terms of ownership than other currencies fyi - moreover - it's just a currency. It's not capital, per sey. B) There's no indication that the masses are better investors than the very large category of investment managers. C) "nobody would have killed the electric car 40 years ago " this is patently false. People have been working on electric cars basically forever and it's been ongoing.
As for GIT ... 'faster merges crated new industries'? If that's what you meant to say then I don't really buy the argument at all. And this has nothing to do with BTC nor is it even analogous.
"Money being at the base of everything, from economics to politicis to science, the blockchain is poised to revolutionize society as no other technology has achieved before."
From your comments I might argue that you might not know what 'money' is.
BTC is not 'money' - it can kind of be used as that, but is not, and is used less and less as such.
BTC has many structural elements which make it not very useful as a currency.
Having a 'Central Bank' is not a drawback in the opinion of most people - this 'decentralization' stuff is technology/libertarian ideology, nothing more. A well managed Central Bank is preferable to a fairly strict currency with arbitrary control mechanisms. An economy that loses the ability to have monetary policy ... well ... loses a lot.
There is a huge ugly factor with VISA/AMEX taking 2% of so many transactions ... but that's another story.
Aside from that transaction fee - our monetary system works pretty well - far better than BTC. The 'problems' that BTC is trying to solve are not real problems. Many of the opportunities it creates are simply the result of bypassing regulations which are there for the most part to protect us.
> Most monetary transactions are already cheap and efficient
Say that to peple sending wires with Western Union at 40% commission, and waiting one week for them.
> BTC is not 'money' - it can kind of be used as that, but is not, and is used less and less as such
Revolutions take some time (this one is going pretty fast). Would I work for bitcoin now? No. Do I consider working for bitcoin in the short future? Yes. Is it important for me to have government approval to work for bitcoin? Haven't decided yet.
> People have been working on electric cars basically forever and it's been ongoing
As said, my comment was not specifically about electric cars, that was just an example. Any other example would do. It would be naive to think that powerful interests have never succeeded in halting progress.
> Having a 'Central Bank' is not a drawback in the opinion of most people - this 'decentralization' stuff is technology/libertarian ideology, nothing more.
Most people do not know or care about this. Whether that is good or bad for them is debatable.
> A well managed Central Bank is preferable to a fairly strict currency with arbitrary control mechanisms. An economy that loses the ability to have monetary policy ... well ... loses a lot.
Sure, amongst other things:
- the ability to debase savings of people and force them into brainless consumption, ensuring everybody is playing the rat race.
- the ability to privatise profits and socialize losses (see financial crisis)
And other niceties.
> The 'problems' that BTC is trying to solve are not real problems.
You are just not seeing the problems, as nobody could see clearcase's problems pre-git. And, more importantly, you are not seeing the possibilities.
Love the comments in this thread. Do a search for Bitcoin (or FB/Amazon/etc.) over the past 10 years. Same comments calling for "bubble" "fundamentals don't make sense" "crash is coming" "but dotcom 2000...". Most of these commenters have not done any research and just sit on their hands typing based on their "feelings" or regurgitate others that align with their feelings.
Take note. Most people are like this. Most people are wrong most of the time.
My store of wealth, denominated in GBP, is no more 'real' than bitcoin, however, the issuer is a large entity, with deep and diverse global assets and the military means to protect those assets.
The GBP I hold is a promise that the issuer will go to almost any means necessary to maintain the value of my wealth in respect to its fungibility.
While there is a raft of risk associated with my wealth, it may diminish in respect of its inter currency value, it may suffer hyperinflation, as a part of my 'deal' with the issuer, they additionally provide a framework for a bank to operate, the bank has insurance, this means that a proportion of my wealth would be preserved even if the institution with which I entrusted my wealth turned out to be a bad actor.
Furthermore my currency is protected from entropy, the accounting system used to store the value of my wealth is secure, by design, and by insurance by the issuer.
In 'good times', I am rewarded for making my wealth available as capital for other users, or interest as it is known.
Bitcoin is exciting, as a follow of everything from e-gold to beenz and an original CPU miner, not to mention possibly the only person to actually profit from the first generation ASIC you have to believe me when I say I am not here to detract from Bitcoin, I'm here to say it's not a currency, it's not an asset, it's really something novel, the value is indeterminable.
The exchange value in this case directly impacts the utility. If you are moving large amounts of wealth and the price is high, then the transfer bandwidth is also high. If the price is low then the transfer bandwidth is low. Ability to transfer wealth geographically with no counter party is the utility.
With current interest rates and inflation, I believe that GBP stored in savings accounts actually decreases in value over time in real terms... There doesn't seem to be many great places to store money in general, which arguably has resulted in bubbles in absolutely everything.
GBP inflation is currently less than 2%, and there are many very low risk options to account for it.
The fact that money sitting in a checking account depreciates due to inflation is a terrible argument for cryptocurrency. No one actually does that with any significant amount of capital.
A straw man for what? Once your net worth reaches a certain level, it would be silly to let it sit in any one asset, whether that's a specific currency or commodity or whatever.
Diversifying with a deflationary asset like Bitcoin is a wise strategy, one that is likely responsible for its $160B market cap.
People who have surplus wealth usually have a mix of assets - stocks, bonds, commodoties, cash, property, and sometimes more exotic assets like art, collectible cars, cryptocurrencies, whatever. Everyone has their own preferences and risk appetite and as such a different mix of assets.
Cash (at least major currencies) is one asset class that is relatively safe but tends to depreciate due to inflation, especially due to recent monetary expansion by central banks. Cash can also be easily seized, and this is a cause of concern for some.
Contrasted with other asset classes that have yield, having all your net worth in cash would not be something you want to do.
Inflation is a feature, not a bug. It encourages you to spend your money which, in turn, allows others to use it to produce "growth".
The reason we need money, from a societal sense, is that there is a time gap between when we decide to build something and when that thing is finished. You need access to raw materials, or labour before the thing you are building is completed. The premise is that the thing you are building is more valuable than the raw material and labour that went into it. Money is basically a lubricant that allows you to pay people before you start and then balance the books after you finish.
If money increased in value over time, we would have a problem. Let's say that the thing you are building will return an extra 5% on the investment. If holding on to money and doing nothing returned 10% in the same time period, you would be stupid to build the thing. You will make more money by doing nothing.
In a deflationary system, people will tend not want to risk the money they have by spending it to build something. This means less demand for goods and services and causes people to be idle. Access to capital is harder because why would I lend you money when I can just make a return by doing nothing? If I'm going to lend it to you, you had better lock in a really good rate -- which means you need to have a spectacular return on investment in your enterprise.
Essentially, rich people are rewarded and poor people are screwed. Society has no incentive to build things and poor people can't bootstrap themselves out of poverty without incredible risk.
I think the easiest way to verify this for yourself is to look at BTC. If you own BTC, what value does it have on society sitting in your wallet? Now consider using those BTC to buy something and employ people. Would you do it? Or would you rather park the BTC in your wallet and hope for a 2-300% return through deflation? Imagine I wanted to start a game company and I would like to borrow your BTC so that I can hire artists, musicians and programmers? Would you lend me your money? What kind of promises would it take to entice you to lend me your money?
Now imagine a currency where the value decreases over time. So you have a million units and over the period of your lifetime, the value will decrease to almost nothing. How does that change your view of whether or not it's a good idea to lend me your money? How does that ultimately affect society?
The people who told you "Inflation is a feature, not a bug" are the same people who benefit from you believing that.
People have used assets like gold as money for thousands of years without long term inflation and it worked very well. It's only in the last hundred years or so that we've been sold the idea that our money should be worth less tomorrow than it is today. Put that way it sounds like a bad thing and that's because it is a bad thing.
One way of looking at inflation is that it's a motivator to encourage us to give our money to other more powerful people before it loses its value. Those more powerful people are the people who told us that inflation is a good thing.
Cryptocurrency takes monetary control away from the rich and democratises it.
I don’t know about you, but I’d much rather have the economy of 1917-2017 than 1417-1517. It’s only in the last 100 years or so that we’ve had, y’know, industrialization and a rapidly rising standard of living. “It worked for thousands of years before the industrial revolution” is an exceedingly poor argument for an economic system.
I would love to hear a decent answer to this as well. To this day i have never received a satisfying answer to this as most inflation supporters think I am a deflation supporter. While i really support No-deflation and No-inflation.
Hitting an exact zero change is impossible, outside of the beautiful assumptions of a system of a equations. A practical person thus chooses which side of zero is better, for those times (effectively all the time) that we can't guarantee equilibrium.
It follows directly from his example. Inflation means that you need to invest your money into something (i.e. either use it directly to buy goods and hire people to produce a product or service and sell it, or else lend it with interest to someone else who will do so on your behalf).
In essence, an inflation economy is one where the only money that is not in immediate circulation is the one that is currently reserved for anticipated imminent transactions (i.e. the bills in your wallet, or in the cash register before the end of the day) - which is a tiny amount. Everything else is parked in some bank account, investment fund, stock etc, where it generates interest for the holder by being loaned out to someone else who currently needs it to produce.
So with some non-zero inflation, you maximize the utility of your monetary tokens as medium of exchange.
There is always going to be a sweet spot where you have enough inflation to convince people to invest their money and not so much that they dump the currency altogether. That sweet spot could be zero. It could even be mild deflation. For example, Japan has been mildly deflationary for a decade or more (though it isn't reported that way, and I think it's a problem). It's not necessarily that bad. With a decreasing work force, one could even argue that right now there is no point to having inflation because unemployment is as close to zero as it's going to get. It really depends.
My point really was that you would never intentionally build a modern economic system that was deflationary. It doesn't make sense, except in some limited circumstances. You will almost always want it to be very slightly inflationary to encourage people not to sit on cash. Exactly where you want inflation depends a lot on the situation, so it's not a one-size fits all.
One thing that's interesting to ponder on is that money is always out of sync with goods and services. So you do some work and get paid. That money should be worth something. But imagine the situation where everybody did a bit of work, got paid enough to retire and then expected to be able to spend their money at the same time -- there is nobody left to work, so they can't spend the money. The system actually requires that people spend pretty much all the money they make because otherwise nobody needs to work for the next round of goods/services. Accumulation of wealth is actually a serious problem for society. It's one of the reasons you have many people encouraging high birth rates and/or immigration so that the population grows -- it keeps your money valuable by having something to spend it on. Now this seems to be clearly insane, but I think human society has a long way to go in terms of giving everyone a comfortable life while still encouraging the work necessary to provide that lifestyle.
There's a big difference between money that returns 10% within a given time period and money that remains even, or has mild ups and downs in value.
If money becomes noticeably less valuable over time it becomes less attractive to hold money at all - and instead scarce assets like a house, land, or gold, etc would be far more desirable. Suddenly everyone is happy to lend you money but no one wants to hold it. Prices soar.
It's true that BTC would be hard to keep as a currency because there is a tendency toward hoarding when something is rising in value. That doesn't prove inflation is desirable though.
You're equating mild, consistent inflation with hyper-inflation. That's not valid. Economies are non-linear dynamical systems that experience phase changes when they pass certain manifolds. Thus the phrases "mild inflation" and "hyper-inflation" aren't just quantitative but also qualitative.
It's made valuable by the credibility of numerous UK institutions and the social contract inherent in the every day trust that people have in it as a currency.
That said - it's a currency, not really a store of value.
And FYI - your GBP holdings are definitely generally worth more than you BTC, mostly because of the inherent volatility of BTC and the fact that it could go to 0 tomorrow. BTC owns the high end of the probabilistic outcomes - but also the low end. You won't get rich owning GBP, but they won't go to zero or near zero either. And if you live in an are where GBPs are useful, like the UK, well there is that added value.
I’d be interested to see a timeplot of the timing of ICO’s against the price/trading volume of bitcoin. My feeling is that there’s a lot of wash trading / market manipulation of bitcoin going on by the perpetrators of ICO schemes, to provide themselves with a way to funnel money out of crypto into dollars. The Bitfinex / tether fraud only works of bitcoin keeps going up.
I don't think you can compare Bitcoin to stocks, housing, tulips or any other commodity and draw bubble conclusions based on that. I think we're dealing with a whole new area of economic psychology that the world simply hasn't experienced this before.
Not saying it won't crash though but I think the reasons will be different than traditional bubbles.
I tend to agree with this assessment of global markets in general. Things have accelerated to a point that no one has any idea what's going to happen anymore. Past experience is not only misleading, but meaningless now.
"Of the four key areas of investment knowledge — theory, history, psychology, and investment industry practices — the lack of historical knowledge is the one that causes the most damage. In finance, there is no controversy: the same speculative follies play out with almost clock-like regularity about once a generation."
A whole lot of investors have come to believe that history is obsolete, and later regretted it.
I think one aspect of that newness is how much more intensely international and 24/7 the crypto game is. That makes it both more vast and more terrifying. I don't have numbers to back up my claim; I just know that the cryptos have immense capital invested/speculated into it from all corners of the world (but seemingly mostly the U.S. and Asia?), it runs on a 24/7 operation and the exchanges are pretty internationally dispersed. How does this compare to the NYSE, in terms of trading hours (09:30-16:00 ET), listed securities and overall accessibility? How much more capital can be pumped (and/or coins dumped) given time spans, lack of 'circuit breakers', and so forth?
There's something about that aspect that I am sure is making this phenomenon potentially wilder than the Dot Com crash of 2001.
What scares me is not the success or failure of BitCoin. What I find troubling is the spirit of BitCoin is paving the way for the exact opposite result.
The idealism is to produce a system for faster, cheaper, and censorship-resistant way to transact. BitCoin is actually becoming unusable for that. It's slower than Etherium, the fees continue to climb when measured against the US Dollar, and the privacy issues are not being addressed.
Sadly, no one will pay any attention to this while the price continues to climb. Only when the price crashes will folks come to their senses, just like when MintPal was hacked which destroyed VeriCoin and when The DAO collapsed with people voting to roll back and fork.
What's the story with Bitfinex (or even Bittrex!) and the Tether situation? It sounds stigmatized and instilling terror as the medium of exchange, but it's all you really have when using a system like that internally (I have to use Tether as an intermediary to swap between coins).
Is that just another component in this house of cards?
If Bitcoin takes a dump, will people panic-sell other cryptos?
If another big crypto explodes, will people panic-sell other cryptos?
The problems and risks in this -- what feels to me, like -- a system, seem interconnected by human psychology if not ACTUAL structures like the exchanges.
All currencies are based on commonly shared beliefs.
I accept $20 bills because I believe other people will accept $20 bills. The paper itself is worthless.
Bitcoin is the same.
It's worth $9,000 as long as enough people believe they can find other people who believe it's worth $9,000.
Meanwhile, trust in governments and banking systems is crumbling. We've seen the hyper inflation in Venezuela. We've seen Saudi Arabia seize 800 billion dollars in assets. We've seen the banking bailouts in the US. As uncertainty rises, a system based on math begins to look like a far safer place to park your wealth.
Belief in Bitcoin may be at an all time high, but it's still the early days. Only 21 million bitcoins will ever be created. Most of them have been mined already & there aren't enough left for every millionaire in the world to own even a single Bitcoin each.
> I accept $20 bills because I believe other people will accept $20 bills. The paper itself is worthless.
That is a common misconception. Government currency has intrinsic value because you are required to pay your taxes in it. If you live in the US, whatever currency you conduct your business in, be it Bitcoin or gold bullion, the USG wants to be paid in dollars. That creates an intrinsic demand for dollars. That intrinsic demand is what ensures that everyone accepts it as a common form of payment. Because everyone has this same common requirement to pay taxes in USD. People then choose to conduct all business in it simply because it's convenient to do so.
The analog for Bitcoin is a little trickier, but I think an argument you might make is that it costs Bitcoin to move Bitcoin. And therefore there is intrinsic demand for Bitcoin, because the value-transfer capabilities it provides are inherently useful.
The dollar, like any fiat currency, is also propped up by political and military power, as well as powerful central banks and gold assets. The paper itself is obviously worthless but what it represents is the currency of a unipolar superpower world backed up by $500 billion in military spending.
Bitcoin has none of that. There's no bailout. There's no economic experts to come in and revise things. There's no political will to exert. Its decentralization is its greatest strength but also its greatest weakness.
This is by design of course. But the argument that it's "just faith" propping up the dollar is fallacious. Apples and oranges.
> I accept $20 bills because I believe other people will accept $20 bills. The paper itself is worthless.
The real worth of a US dollar bill comes from the US military. In case the value of USD starts going down, the military will do whatever is "necessary" to restore economic order.
Suppose there is an increase in oil prices. That means the US now has to spend more to satisfy domestic demand. That invariably results in devaluation of the dollar. If this becomes extreme enough, US boots march into the middle east and "make things right" again.
Another example. Suppose a bunch of terrorists crash a couple of planes into a symbol of American economic strength. Again, US drones and boots on the ground would fuck up whatever corner of the earth that needs to be obliterated in order to restore people's faith.
These two are very direct actions, but most influences are far more subtle. What happens if China tries to manipulate US currency using its vast dollar reserves? It won't, because within hours a couple of aircraft carriers would show up inside Chinese sea waters. Just the existence of capability is enough to deter China.
What if the American people wake up to the fact that the dollar is leveraged beyond reason? And realize that it's all a house of cards? And that military doesn't think the dollars they're paid with are worth anything?
Bitcoin is really starting to resemble a pyramid scheme or penny stocks. No one can really cash out without people cashing in, otherwise the entire pyramid collapses. And the cult-like mentality of many Bitcoin holders does strike me as a multi-level marketing attitude. Just visit any forum or thread about bitcoin and there will always be that one person with some kind of tagline "it's not too late to get in!" which is a classic FOMO sales tactic. You know when the average person is getting into the market, we are in the late stages of the game.
When suckers enter, smart money leaves.
It's a very interesting technology which will continue to exist but it's really looks like an out of control bubble. In some ways it would be better for it to implode and get the snake oil salesman and sketchy white papers out of the ecosystem.
It used to be a really cool proving ground for cutting edge technologies but now it's looking more like rampant greed, excess and arrogance.
If that were true, why does everyone talk about it in fiat currency terms? Why would it matter what price BTC is, if the goal is to just use it? Who cares, then? I don't buy that argument. It seems to be mostly fueled by greed.
The bitcoin is a financial asset with no ballast that people buy because they believe it will appreciate.
To liquidate your position and to make a profit you need constant inflow of new investors to keep the market going as BTC has no true value. There's no backing of any hard assets.
The revenue stream is based on new investments rather than the underlying product itself. That's a very common pyramid scheme/multi level marketing scenario.
This is very different from company stocks, as the stock unit itself is a guarantor of dividends and a small part ownership of the assets of a company. Its price is representative of the performance of the company, it is not the product itself. That company produces something (in theory), although to cash out you still need to find someone to buy it at a said price.
Well that pays for my Christmas shopping. Made a couple thousand now off ~$10 I spent out of novelty. Hurts a bit seeing what I used to have
I really don't see it personally. It seems pretty clear people are buying and holding en mass at this point and it just seems like pure FOMO. There is no underlying asset and I don't think its that useful for replacing cash. Not going to complain though. I'll go on, take my money and run.
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[ 2.0 ms ] story [ 244 ms ] threadAt the moment they are pretty obnoxious about it and are feeling bad for me.
Google Trends put Hawaii at the top for the US, Guam for global.
Then I realize, I would've sold it off when it hit $250 per BTC and I'd probably hate myself more.
Still don’t regret it though because I know the next few years of my early 20s would have been spent tracking BTC like a bloodhound rather than spending that time on things I enjoy.
Then again I’m probably telling myself that so I don’t feel bad for missing out on 100s of thousands of dollars.
At least that's how I see it. Don't know jack shit about cryptocurrencies, but this seems like basic economy.
Especially tulips that burn through soooo much electricity.
The longer you go on trying to call peaks and slandering crypto as "human stupidity", the more cognitive dissonance will form, followed quickly by the rationalizations needed to dispel it.
Everyone in hysterics about a bubble is every bit as foolish as those shouting about going to the moon. We've had over a year of steady growth punctuated with regular corrections.
Will there be a bear market at some point? Certainly. But the proof of bubbles is in the popping; major price action down to a tenth of the peak or so. That doesn't just happen because of a bull market, it happens in the wake of a major speculative wave or something that fundamentally compromises value.
Most people buy lots of lottery tickets that don't win. What a waste of money! What a bunch of suckers! If only they'd been paying more attention to the lottery tickets that won, they'd be rich now!
Ethereum has the best fundamentals right now in terms of user adoption. It's transaction volume in terms of number of transactions is ahead of everything else out there. ETH has some technical risks though. It has uncapped coin issuance that is currently quite high ~14% and they want to switch from the proven proof of work mechanism to proof of stake and it isn't clear that will be successful.
Beyond that Bitcoin Core is crippled and everything else has pretty low adoption though some alts like Monero look like they might find a niche in dark markets where strong privacy guarantees are important.
That kind of thinking leads many people to speculate (not investing). I consider speculation to be in the same category as gambling.
My coins were spread across a couple of USB keys and a hard disk, all encrypted with a passphrase I thought I knew but that didn't work last time I tried to decrypt the hard drive. The USB keys went missing. I think my girlfriend's cats stole them. The coins were worth a few hundred bucks when I lost access to them. They'd be worth...well, a lot more, today. The hard disk is maybe still functional and somewhere in my storage unit, though I probably still don't know the passphrase. The USB keys are probably gone forever, as I've moved house twice since I saw them last.
It's pretty frustrating, but I probably would have sold the coins when BTC broke $1000, anyway. So, I would have made a few thousand bucks, tops. Honestly, while I still hold a little bit of BTC, I don't really believe in it. It is an environmental disaster, the fees have gone through the roof. It is difficult to secure; everyone says "Keep it in an off-line wallet." But, I lost all of my off-line wallets. The only BTC I still have from back then is in Coinbase. Keeping a physical item really safe is costly or just annoying. You need a safety deposit box, or a firesafe, to be really sure of it. Since I live in an RV, there's not really any way for me to be confident any coins of significant value in a physical wallet would be safe. I wouldn't keep a physical wallet with me any more than I would keep significant cash under my mattress.
I always posit this question, to which I have never received a satisfactory answer: What, exactly, would the US do if the world suddenly decided that the dollar was worth nothing?
Massive buybacks of dollars by the Fed would be seen as an ineffective and desperate move. Besides that, what other recourse do they have?
Why would the rest of the world decide this? It’d hurt them more than it’d hurt the US or else they’d have done it already.
So, in such a world, I wouldn’t find it so surprising that certain countries would like to wean themselves of the dollar. Of course, this it is more important for powerful geo-political actors like China and Russia, than Somalia (uses USD extensively), and as an example you can look at how China is planning on offering a yuan priced oil contract that is backed by gold.
Economically the US is very well positioned - it has friendly neighbors, a robust legal system, a diversified industry and a lot of natural resources, so it would take quite a bit for hyperinflation to occur. Obviously anything is possible, though.
We've seen 20% inflation before, and I see no reason we can't see it again.
Yes. This is the basis of 20th century American prosperity.
Look up Chiquita bananas on Wikipedia
It's only a slight exaggeration to describe taxes like that. There are huge amounts of assets held under the jurisdiction of the US government (probably somewhere north of $100 trillion[1]) and a huge number of people who live under the jurisdiction of the US government (>300 million). If the owners of those assets or the people living in the US don't pay their tax bills, the government can resort to seizing their property to cover the tax bill or jailing the person who didn't pay. If they don't cooperate with that action, the government can send people with guns to force them to comply. Effectively, everyone who lives in or owns property in the US is forced to acquire dollars to pay their tax bill.
[1] https://en.wikipedia.org/wiki/Financial_position_of_the_Unit...
Likewise, US dollars are "legal tender for all debts public and private". If someone (in the US) refuses to accept US dollars to consolidate a US debt, they will be arrested or killed (after several opportunities to course correct) and their property will be forcefully taken.
And for a third example - consider someone trying to set up an unregistered company in the USA. If they get on the government's radar, what do you think their long term prospects are?
Fortunately, our legal system and general social beliefs mean that it rarely if ever would come that far. But the threat of violence is real. And think - without that threat, however far removed, why would anyone pay their taxes or follow most laws?
Why would the world suddenly not want in on that?
When Zimbabwe destroyed its currency the real killer wasn't leaving the printing presses on (it was too late by that point) it was the systematic destruction of its agricultural industry.
If the influx of USD was higher and faster than could be addressed, the economy would naturally get inflation that would force interest rates even higher up (since no banks will lend at a loss, so borrowing costs get pushed up first by the fed, and then by the need to cover for expected inflation). This would be a death blow to many indebted and highly-leveraged businesses that are dependent on low interest rates for operational purposes (including those in the financial sector) and so they would go out of business. The need for the financial system to write-off the debt held by these companies would also eliminate a certain amount of money in circulation. Eventually enough money has been destroyed/absorbed and the economy is back in equilibrium.
On a less than academic note: this is not a totally unlikely scenario since the flight-to-crypto is a de facto process of de-dollarization, with crypto assets essentially replacing fiat both as store of value as well as medium of exchange. Put another way, the increase in the value of cryptocurrencies is really just a loss in the purchasing power of everyone holding fiat, and since these additional assets are now competing to purchase the same pool of goods, what people think of as bubbles in assets like housing are really just reflective of inflation in the underlying supply of money-that-can-buy-things. And it will get worse when you can sell your house for crypto.
People will scoop up all the free dollars, and bring them back to the us where they have value.
Contracts still have to be paid in dollars. Some people around the world would be upset that their dollars are worthless, but it turns out they could sell those dollars to people who need to pay debts in dollars. So suddenly this valueless piece of paper has value again, because you can trade it for things you want.
if you can in an instant impose some irrational condition for an instant, i think the global economy will, certainly shift, but people would notice all of the arbitrage opportunities and things would _generally_ go back to the way they were, like a flash crash.
if you could wave a magic wand, and make people think the dollar is worthless for 10 years? That would be weird. i imagine we'd make a new currency, dollar2 and just pay everyone in that. you could bring in old dollars to the us and exchange them for dollar2's. But because people are under a spell, they can't think of the arbitrage idea. so it only happens accidentally.
As long as there's a base of goods/services that can be bought and are priced in dollars, dollars will continue to have value.
Why would the fed need to buy back dollars?
You might as well ask what would happen if the world suddenly disbelieved in anything else that's just a social construct -- property, authority, family, etc. It's a fun and perhaps enlightening thought experiment, but not much practical use.
To be crude, human poop takes effort to create, but the worth of it as a tradable good is significantly less than the effort involved.
It's amazing to watch the price go up as utility has gone down. In 2012 or so Bitcoin was legitimately useful. Coinbase was around so it was easy to buy. You could move it for reasonable fees / transaction times and it gave you access to Darknet Markets which offered services you couldn't get anywhere else. We also believed it to be private because law enforcement had not yet developed any block chain analysis software. Bitcoin was the only credible coin, everything else was a joke or lacked critical mass.
Now none of that is true. If you're interested in privacy you don't touch BTC with a 10 foot pole. If you want an actually usable currency with speed and low fees you use ETH or any other. And if you're a financial institution you're looking at Ripple. Oh and let's not forget all the BTC forks and exchange hacks.
Yet the price just climbs and climbs, and many people are getting quite rich. I can't say I'm not jealous, but I still won't invest because the fundamentals are all wrong. Someone will be left holding the bag.
While it’s true that it’s less private and useful than it was, there are developments that will make it better and some are in testing now (such as LN).
It is a bubble, but it’s anyone’s guess when this madness will stop. There’s relatively few BTC out there.
Like many others I regret I didn’t hold onto BTC I once had...
Ripple will find a use and may do quite well. But it requires more trust in a few centralized parties. It won't replace Bitcoin's primary use case as the highest security value store and world-wide settlement layer.
https://themerkle.com/ripple-labs-settles-lawsuit-with-jed-m...
What's more interesting is that, for example, Bitcoin Cash has a similar level of on-chain activity to 2012-era Bitcoin without the interesting shops accepting it, but its price is about a hundred times higher than 2012-era Bitcoin.
That's an interesting way to think about BCH. Some of the price increase is justified due to the increasing legitimization of all crypto currencies but definitely not 100x.
I am not going to throw allegations out, but I believe there will be a day in the coming years where we read stories about organized crime and pump and dumps in this space. I believe the bitcoin forks will be at the heart of this all.
Everybody is happily singing the song of crypto while the music is going. Not sure how long it will last.
Bitcoin forks are funny because it's decentralized software with a shared database history from the time of the fork. After an update, users can choose to use one or the other. Unfortunately the incentives are warped for miners and devs, so users might not have the best possible design.
There's an excessive amount of propaganda surrounding cryptocoins because "investors" need to psychologically lure you in to buy their supply, which they've acquired for significantly lower value, lower capital, and lower computational work then you if you're starting after them.
[0] https://medium.com/@bitfinexed/latest
It looks like bitcoin cash is going to be extremely useful for doing daily type transactions (ie. low dollar transactions etc.)
That is where the "scam" lies. It isn't discrediting BCH — BCH already did that to itself.
Nope, you just see a completely pragmatic view of Ver's actions as an attack, probably formed on the r/btc sub (that he mods).
I love how you say "completely clueless" too — because it's ironically you.
If you don’t like BCH then don’t use it, you can leave that to everyone else.
24HR Transactions:
* BTC — 328,580 [1]
* BCH — 20,255 [2]
[1]: https://bitinfocharts.com/bitcoin/
[2]: https://bitinfocharts.com/bitcoin%20cash/
Far fetched idea is that these networks were designed for this type of washing. Clean and Dirty money enters in, someones bound to walk at some point.
But today it's becoming more and more clear what it'll eventually end up being: not a payment network, not a private way of transacting, but digital (yet secure) gold. That's all Bitcoin will most likely ever be and that is totally fine.
There is something to be said about an asset that is held outside of the traditional financial system. I'm not a Bitcoin bull, but I also wouldn't be surprised if a coin hits $100,000 (or more) sometime in the next few years.
Ethereum though.. I'm more curious about how that will turn out. Seems to have many potential interesting use cases
They're stating that "intrinsic value", e.g. gold being usable for things other than trade, is not necessary for a tradable thing to have value. It is only necessary for people to be able to trust that the thing has value and having "intrinsic value" is one way for that trust to be gained.
With cryptocurrency, it's gained with a bunch o math.
The non-loony ETFs, Swiss vault storage, etc. Let's simplify to "the GLD ETF" [1]. This of course isn't really gold, it's paper gold (and has in fact been fractional-reserve-banked: there is far more paper gold than actual gold).
The loony gold storage: gold bars under your pillow. Unfortunately, the gold people use for payments is extremely regulated, specific grades of gold, guaranteed by a very small number of financial institutions (and numbered). Whilst at least these are obviously not oversubscribed, if you have one you can't sell it (aside from the subdivision problem), because there's no easy way to verify the guarantees, and there are an untold number of fakes in circulation.
[1] tradingview.com/e/?symbol=GLD
As for lightning network, let's wait and see once it's actually completed. Can Bitcoin afford to wait that long? The core developers are taking an awfully big risk when Bitcoin cash had shown that bigger blocks are not an issue.
Why bother with Bitcoin if my Bank can do it cheaper and faster, even with lightning?
Who knows...the crypto that wins out might not even be invented yet.
Yeah, 50 might be more than is really needed, but there is no reason why several or more can't happily coexist, each specialized in their own way.
Just sayin.
When you try to place an order on Kraken it 100% of the time on the first try gives you some generic message that says something like "We're not sure if your order went through. Check back later." So you wait a bit, refresh, and it looks like it hasn't gone through, so you enter it again. You get the same message 5 times in a row. On the 6th try, your order goes through. Sometimes you end up with 2 orders going through because one you thought didn't go through just took longer than you had the patience for.
I'm being completely serious when I say this isn't something that happens occasionally; it happens every time.
They say they're working on a new engine or something that should be out in a few months, but it's a known and annoying problem for now. Other than that, I like Kraken and agree that it seems less shady than most.
I think this is a good overview of the basic numbers and banking situation: https://ftalphaville.ft.com/2017/09/15/2193370/crypto-tether...
Oh, like write-only memory?
Only if they cash out. You need new investors to be able to cash out. The wise ones smell the crash and are the first ones out. Some make it out just before the crash when the party is still going but the fires are rising. The rest burns. There is no real value in bitcoin (unlike the stock exchange or fiat money where valuable people are trapped in contracts).
If you're a CTO of a major company and you don't have a wallet with at least $1m in BTC in some wallet somewhere then you're risking a major disaster if someone breaks in and locks up your data.
But just because there are real uses doesn't mean that I think that the government will allow it to remain legal.
Facebook and Snap did well because they were "cooler" than their predecessors, and they had different/more uses. I think that's analogous to where I see the future of crypto
There have been plenty of crashes until now, and those who "smelled it" and sold (I did) lost lots of paper profits.
There will be other crashes for sure, and it will be impossible to know if it's the BTC Apocalypse™ or the BTC Yearly Crash™ until late in the process.
Unless, of course, one belongs to the BTC-illuminati.
Either way, it's free money to me, so I try not to be too greedy...
I agree that each asset class comes with risk, and that euro and dollar is currently less risky than crypto. But remember that each has its own risk. Fiat money goes down at about 2% each year, if you're in a proper economy. Did you see the quantitative easing that was done on the dollar? Scary.
Do you think people in Zimbabwe are "cashing out" to their local currency? https://www.bloomberg.com/news/articles/2017-11-15/bitcoin-s...
Some people are even "cashing out" to expensive real estate I read, not dollars.
Don't make the mistake to think euro's or dollars are the unit of value, they are not. Their price goes up and down just like everything else. History was not kind to fiat money (see French revolution for example).
Bitcoin is in a position to compete with central banks and commercial banks with fraction reserves. The chance of crypto really getting that far might be low, but it is still there, don't forget about that.
Nobody can be certain of the "bitcoin bubble", and nobody can be certain of the "worldwide bitcoin takeover of fiat money". Maybe it will end somewhere in between. It's all chances. You have to play on the risk factors of each, not on "I believe ...".
You don't cash out, you properly organize your assets.
Couldn't agree more. I've been following crypto since 2012. The most exciting aspect of bitcoin personally was being able to hold both cash(private/low fees) AND and an asset(scarce) on the internet without having to trust any 3rd parties. Sad to see the community is just settling on the latter (at least for now).
I don't think there's a need for two different currencies to represent both 'cash' and 'asset'. I think in the future it'll most likely be one crypto that fulfills both needs. And as of right now, I wouldn't bet on Bitcoin.
But hey, what do I know ¯\_(ツ)_/¯
The latter ones are not "rich"; they're "paper rich", which is radically different.
I think it's crucial to highlight the difference, since the BTC may be toilet paper tomorrow, or maybe not; and this is how lotteries work.
Your statement, from my understanding, is saying "if people cash out, everything will crash". That's simply not true. More so, it's not true because that's fundamentally not how markets work.
Whenever someone buys 400 BTC, that means someone else sold or "cashed out" 400 BTC. This is a highly liquid market system with many participants, not a lottery system.
I never wrote that. I've been quite specific:
> BTC may be toilet paper tomorrow, or maybe not; and this is how lotteries work.
The difference between wealth and "paper wealth", in this interpretation, is simply in the volatility of the assets.
BTC is extremely volatile both in the short and long terms, therefore being rich can't be disassociated from the cash out.
Association is the concept I'm stressing. With lowly volatile assets, one can be reasonably confident the value of the assets, so cashing out can be reasonably ignored, but with highly volatile ones, one can't, so it's all about the moment of the conversion.
Lottery has probably been a wrong term - probably gambling is better, but the concept still stands.
Running around hopping on popular ideas, foaming at the mouth fearing to lose out is an unpleasant mental/emotional state of mind IMO.
Trading bitcoin is speculation. It's not investing (where fundamental analysis can be useful to evaluate assets). But a lot of money can be made (and lost) by speculating. It just depends on your risk profile.
The fact that this is upvoted so high really shows the number of people who truly lack an understanding of an asset but are vocal in spite of that fact.
At least he understands that he doesn't understand how on earth it works and that should be grounds enough for caution.
If I didn't already have problems with how much electricity it burns for even the smallest transaction, that would have been enough to put me off it.
I apologized to him for possibly being wrong about warning him off from what looks to me like an enormous bubble, but from what I've seen outside of our own tech bubble, it's an enormous bubble that most of the buyers have little to no understanding of.
I made 1300% on Nvidia stock purchased in 2009, after that court ruling. I'm content with the money I've indirectly made off Bitcoin.
I can't really think of many reasons why you would use crypto to pay for a coffee or a sandwhich if you live in the West (or frankly, even most developing nations). On the other hand, I can definitely see the utility in a censorship-resistant digital medium to store wealth. To me, this latter use case has much, much more potential to serve the unbanked (as well as the banked).
Some use cases I can think off the top of my head:
(1) You are from Syria and need to flee war and escape into Europe – however bank transfers into Europe are almost impossible if you are a common Syrian. Bitcoin allows you to take your wealth with you, in your brain, as you escape across the border, by just memorising your twelve word private key.
(2) You are from Venezuela or Zimbabwe – The government has issued capital controls and is devaluing currency by the day. You transfer your wealth into Bitcoin in order to offset capital erosion due to hyper-inflation. When the situation stabilises, you transfer your Bitcoin back into fiat.
(3) You are Saudi billionaire Al-Waleed bin Talal. The government freezes all your assets in a political coup. If you have a portion of your wealth in Bitcoin, you could protect them from government expropriation and anonymously transfer them to associates or family members abroad.
(4) You are whistleblower Julian Assance and have been cut off from the financial system as a way to censor your speech. Bitcoin allows you to have an unbreakable digital "Swiss bank account" that the authorities are not able to reach.
This reminds me of Peter Thiel's recent words about Bitcoin: "it's like a reserve form of money, it's like gold, and it's just a store of value. You don't need to use it to make payments."
Reference
[1]: https://www.cnbc.com/2017/10/26/bitcoin-underestimated-peter...
But now that we have widespread adoption of smartphones and high-speed internet(still lagging behind in some countries), plus a plethora of tools to build apps and track, analyze and influence user behavior, tech companies are some of the wealthiest and most influential enterprises on the planet, two of them even survived the 2000 bubble(GOOG and AMZN), IMO, far beyond the imagined potential of dot-com predictions.
So I partly agree with you, I think there are some extreme expectations on BTC and a major crash seems possible, but who knows, maybe technology will enable BTC or some other cryptocurrencies to thrive the same way the internet recovered from the dotcom bubble burst.
One can only hope this will be "the next" .com bubble -- there will be money to be made. Given the amount of liquidity that was pumped into the market by the fed, it will be interesting to see what stops this train.
The more and more you look around, money isn't worth anything anymore. Like that recent Leonardo Da Vinci painting that was sold for $450m. Assets and companies selling for a 10-12x multiple, excessive property prices in prime locations, etc. Asset prices have been driven up significantly across the board.
Transaction costs are high, Transactions take forever to pass, and it's not even really anonymous.
So what's left but a token that has no underlying value other than a proposition which can largely be discounted?
The mysterious author, watching mtgox grow, collapse and subsequent revelations, "we found Satoshi" debacle, the DAO heist and reaction, altcoins, block size schism, ICO's, segwit activation, segwit2x deactivation and bugs, Teather's "theft", this rally ...
Chinese mining pools, Russian hackers, the dark web, struggles for control; it's like living in a Neal Stephenson novel. Worth the price of admission just for the entertainment value.
Except that there is no net new value being created - and it's a zero sum game. So any 'riches' you make are from some suckers pocket.
No thanks.
The Valley and tech works because we are doing a lot of non-zero sum game stuff. Whenever anyone invents/creates something new - we can grow the whole pie.
Yes - I see how it could be considered fun ...
But most of the 'riches' from the 'Wild West' went to those who were just willing to be the most brutal.
So in reality ... no thanks.
A) The bulk of value in capitalism is not created via the exchange of shares - it's created when people 'do stuff, make stuff and invent stuff' - yes - there is some value creation by financial activity, but it's not the bulk.
Crypto currencies - if they were actually used as currencies - would provide some value. But i) they are not being used as currencies - and ii) they are certainly not being used to the point wherein they should be having a $50B valuation/cap.
It's wrong to suggest that BTC has created $50B in value for civilization.
B) Your point about valuation is wrong.
Stocks can be valued in a number of ways, but ultimately they are worth the present value of all the assets the company has - and will have. Why? Because stocks are ownership. The companies bank account is de-facto owned by shareholders.
Crypto currencies cannot be valued - they don't have anything underlying them - they do not imply ownership of anything - and especially since they are not used as currencies - their valuation is a total fantasy.
BTC is worth whatever the next guy thinks it is worth - and what he thinks it is worth is pure speculative fiction. Just a function of emotional dynamics and fad.
A stock in 'Bank of America' - well you can calculate how much assets they have, and estimate how much you might think they will earn in the future. There will be disagreement over that hence fluctuating value of prices ... (and BTW it's good that we have a lot of people trying to figure out how much BofA is worth - that provides value).
At least as of today - all crypto currencies are a fiction. They are invented numbers that others are duped into paying money for. They are generally not used as currencies, and so ... 'there is no 'there' there'. Even thought it's really interesting from an academic perspective, and something may yet come out of it.
However, there are a whole class of stocks where the stock price is based on nothing more than perception of value. There is almost zero actual, intrinsic value. You see this often with penny stocks (and even larger companies, back in the dot-com days.)
>Crypto currencies cannot be valued - they don't have anything underlying them - they do not imply ownership of anything - and especially since they are not used as currencies - their valuation is a total fantasy.
>BTC is worth whatever the next guy thinks it is worth - and what he thinks it is worth is pure speculative fiction. Just a function of emotional dynamics and fad.
Isn't that equally true of any currency? It doesn't pay dividends and doesn't guarantee ownership of anything, and rises and falls based on the whims of the market. At most you can say that legit currencies are "ownership" of "the cancellation of X units of tax debt", but that's somewhat circular: there's no guarantee that "X units of tax debt" will be a large burden in the first place, and will itself fluctuate in value with the market.
[1] It's true that bitcoin has many failings at achieving anonymity but it certainly competes with international bank transfers for many use cases.
Necessary disclaimer: I'm long bitcoin and and author of understandingbitcoin.us.
And many stocks are similarly overvalued by orders of magnitude compared to the actual assets the company holds, to the point that saying that it's "how much they will earn in the future" is meaningless. People buy those stocks because they hope to sell them at a greater price to other people and cash in on the difference, just as they do with BTC.
When companies grow faster than the 'cost of capital' for the person buying the stock - then the value goes to infinity - so this is a problem.
But it's still based on something.
Telsa stock will not go to $20K each.
If you want untraceability you should pick up Monero.
Empirically, BTC is used a lot for this kind of stuff - ransomware payouts, Silk Road type marketplaces etc.
I'm aware it's used for this kind of stuff but that doesn't really change facts.
Even more: having the masses controlling the capital would allow for novel allocation of financial resources: nobody would have killed the electric car 40 years ago if research capital had been more distributed (just an example, not trying to bring up any specific conspiration theory).
More applications, taken from git: before git took the development world by storm, everybody was pretty much used to cumbersome and slow merges when doing team development. Once a fast vcs tool appeared, the possibilities multiplied, and whole new industries emerged. A couple of simple features (speed, low cost, easy setup) where enough to create a miriad of new applications.
Money being at the base of everything, from economics to politicis to science, the blockchain is poised to revolutionize society as no other technology has achieved before.
+ There is no evidence of value from a 'decentralized' system - in fact, there's considerable value from a managed currency which we know will expand as the economy needs it - not an some arbitrary and ridiculous parameter such as the availability of computing power.
+ Most monetary transactions are already cheap and efficient.
"having the masses controlling the capital would allow for novel allocation of financial resources:"
A) BTC in no way enables 'the masses to control the capital' - it's probably more concentrated in terms of ownership than other currencies fyi - moreover - it's just a currency. It's not capital, per sey. B) There's no indication that the masses are better investors than the very large category of investment managers. C) "nobody would have killed the electric car 40 years ago " this is patently false. People have been working on electric cars basically forever and it's been ongoing.
As for GIT ... 'faster merges crated new industries'? If that's what you meant to say then I don't really buy the argument at all. And this has nothing to do with BTC nor is it even analogous.
"Money being at the base of everything, from economics to politicis to science, the blockchain is poised to revolutionize society as no other technology has achieved before."
From your comments I might argue that you might not know what 'money' is.
BTC is not 'money' - it can kind of be used as that, but is not, and is used less and less as such.
BTC has many structural elements which make it not very useful as a currency.
Having a 'Central Bank' is not a drawback in the opinion of most people - this 'decentralization' stuff is technology/libertarian ideology, nothing more. A well managed Central Bank is preferable to a fairly strict currency with arbitrary control mechanisms. An economy that loses the ability to have monetary policy ... well ... loses a lot.
There is a huge ugly factor with VISA/AMEX taking 2% of so many transactions ... but that's another story.
Aside from that transaction fee - our monetary system works pretty well - far better than BTC. The 'problems' that BTC is trying to solve are not real problems. Many of the opportunities it creates are simply the result of bypassing regulations which are there for the most part to protect us.
Say that to peple sending wires with Western Union at 40% commission, and waiting one week for them.
> BTC is not 'money' - it can kind of be used as that, but is not, and is used less and less as such
Revolutions take some time (this one is going pretty fast). Would I work for bitcoin now? No. Do I consider working for bitcoin in the short future? Yes. Is it important for me to have government approval to work for bitcoin? Haven't decided yet.
> People have been working on electric cars basically forever and it's been ongoing
As said, my comment was not specifically about electric cars, that was just an example. Any other example would do. It would be naive to think that powerful interests have never succeeded in halting progress.
> Having a 'Central Bank' is not a drawback in the opinion of most people - this 'decentralization' stuff is technology/libertarian ideology, nothing more.
Most people do not know or care about this. Whether that is good or bad for them is debatable.
> A well managed Central Bank is preferable to a fairly strict currency with arbitrary control mechanisms. An economy that loses the ability to have monetary policy ... well ... loses a lot.
Sure, amongst other things:
- the ability to debase savings of people and force them into brainless consumption, ensuring everybody is playing the rat race.
- the ability to privatise profits and socialize losses (see financial crisis)
And other niceties.
> The 'problems' that BTC is trying to solve are not real problems.
You are just not seeing the problems, as nobody could see clearcase's problems pre-git. And, more importantly, you are not seeing the possibilities.
It takes about 10% commission at most and it's same-day.
Definitely can be improved upon but you're exaggerating.
Plus, bitcoin has huge friction for people unfamiliar with it - Western Union's network is great.
An option or future is zero sum. One goes to zero, the other gets paid on expiration, a winner and loser.
Take note. Most people are like this. Most people are wrong most of the time.
The GBP I hold is a promise that the issuer will go to almost any means necessary to maintain the value of my wealth in respect to its fungibility.
While there is a raft of risk associated with my wealth, it may diminish in respect of its inter currency value, it may suffer hyperinflation, as a part of my 'deal' with the issuer, they additionally provide a framework for a bank to operate, the bank has insurance, this means that a proportion of my wealth would be preserved even if the institution with which I entrusted my wealth turned out to be a bad actor.
Furthermore my currency is protected from entropy, the accounting system used to store the value of my wealth is secure, by design, and by insurance by the issuer.
In 'good times', I am rewarded for making my wealth available as capital for other users, or interest as it is known.
Bitcoin is exciting, as a follow of everything from e-gold to beenz and an original CPU miner, not to mention possibly the only person to actually profit from the first generation ASIC you have to believe me when I say I am not here to detract from Bitcoin, I'm here to say it's not a currency, it's not an asset, it's really something novel, the value is indeterminable.
The fact that money sitting in a checking account depreciates due to inflation is a terrible argument for cryptocurrency. No one actually does that with any significant amount of capital.
https://www.ons.gov.uk/economy/inflationandpriceindices/bull...
Diversifying with a deflationary asset like Bitcoin is a wise strategy, one that is likely responsible for its $160B market cap.
Cash (at least major currencies) is one asset class that is relatively safe but tends to depreciate due to inflation, especially due to recent monetary expansion by central banks. Cash can also be easily seized, and this is a cause of concern for some.
Contrasted with other asset classes that have yield, having all your net worth in cash would not be something you want to do.
The reason we need money, from a societal sense, is that there is a time gap between when we decide to build something and when that thing is finished. You need access to raw materials, or labour before the thing you are building is completed. The premise is that the thing you are building is more valuable than the raw material and labour that went into it. Money is basically a lubricant that allows you to pay people before you start and then balance the books after you finish.
If money increased in value over time, we would have a problem. Let's say that the thing you are building will return an extra 5% on the investment. If holding on to money and doing nothing returned 10% in the same time period, you would be stupid to build the thing. You will make more money by doing nothing.
In a deflationary system, people will tend not want to risk the money they have by spending it to build something. This means less demand for goods and services and causes people to be idle. Access to capital is harder because why would I lend you money when I can just make a return by doing nothing? If I'm going to lend it to you, you had better lock in a really good rate -- which means you need to have a spectacular return on investment in your enterprise.
Essentially, rich people are rewarded and poor people are screwed. Society has no incentive to build things and poor people can't bootstrap themselves out of poverty without incredible risk.
I think the easiest way to verify this for yourself is to look at BTC. If you own BTC, what value does it have on society sitting in your wallet? Now consider using those BTC to buy something and employ people. Would you do it? Or would you rather park the BTC in your wallet and hope for a 2-300% return through deflation? Imagine I wanted to start a game company and I would like to borrow your BTC so that I can hire artists, musicians and programmers? Would you lend me your money? What kind of promises would it take to entice you to lend me your money?
Now imagine a currency where the value decreases over time. So you have a million units and over the period of your lifetime, the value will decrease to almost nothing. How does that change your view of whether or not it's a good idea to lend me your money? How does that ultimately affect society?
People have used assets like gold as money for thousands of years without long term inflation and it worked very well. It's only in the last hundred years or so that we've been sold the idea that our money should be worth less tomorrow than it is today. Put that way it sounds like a bad thing and that's because it is a bad thing.
One way of looking at inflation is that it's a motivator to encourage us to give our money to other more powerful people before it loses its value. Those more powerful people are the people who told us that inflation is a good thing.
Cryptocurrency takes monetary control away from the rich and democratises it.
You think that the amount of gold in circulation has been constant for thousands of years?
> without long term inflation and it worked very well
Au contraire, past attempts at maintaining a non-inflationary currency have failed.
Technically the US was still on the gold standard up until the 70s.
Why is inflation better than no-inflation and no-deflation?
In essence, an inflation economy is one where the only money that is not in immediate circulation is the one that is currently reserved for anticipated imminent transactions (i.e. the bills in your wallet, or in the cash register before the end of the day) - which is a tiny amount. Everything else is parked in some bank account, investment fund, stock etc, where it generates interest for the holder by being loaned out to someone else who currently needs it to produce.
So with some non-zero inflation, you maximize the utility of your monetary tokens as medium of exchange.
My point really was that you would never intentionally build a modern economic system that was deflationary. It doesn't make sense, except in some limited circumstances. You will almost always want it to be very slightly inflationary to encourage people not to sit on cash. Exactly where you want inflation depends a lot on the situation, so it's not a one-size fits all.
One thing that's interesting to ponder on is that money is always out of sync with goods and services. So you do some work and get paid. That money should be worth something. But imagine the situation where everybody did a bit of work, got paid enough to retire and then expected to be able to spend their money at the same time -- there is nobody left to work, so they can't spend the money. The system actually requires that people spend pretty much all the money they make because otherwise nobody needs to work for the next round of goods/services. Accumulation of wealth is actually a serious problem for society. It's one of the reasons you have many people encouraging high birth rates and/or immigration so that the population grows -- it keeps your money valuable by having something to spend it on. Now this seems to be clearly insane, but I think human society has a long way to go in terms of giving everyone a comfortable life while still encouraging the work necessary to provide that lifestyle.
If money becomes noticeably less valuable over time it becomes less attractive to hold money at all - and instead scarce assets like a house, land, or gold, etc would be far more desirable. Suddenly everyone is happy to lend you money but no one wants to hold it. Prices soar.
It's true that BTC would be hard to keep as a currency because there is a tendency toward hoarding when something is rising in value. That doesn't prove inflation is desirable though.
Yet with our inflationary system, this is exactly what has been happening.
It's made valuable by the credibility of numerous UK institutions and the social contract inherent in the every day trust that people have in it as a currency.
That said - it's a currency, not really a store of value.
And FYI - your GBP holdings are definitely generally worth more than you BTC, mostly because of the inherent volatility of BTC and the fact that it could go to 0 tomorrow. BTC owns the high end of the probabilistic outcomes - but also the low end. You won't get rich owning GBP, but they won't go to zero or near zero either. And if you live in an are where GBPs are useful, like the UK, well there is that added value.
That's an absurd notion, if that were true they wouldn't keep printing more of it and giving it to someone else.
Not saying it won't crash though but I think the reasons will be different than traditional bubbles.
"Of the four key areas of investment knowledge — theory, history, psychology, and investment industry practices — the lack of historical knowledge is the one that causes the most damage. In finance, there is no controversy: the same speculative follies play out with almost clock-like regularity about once a generation."
A whole lot of investors have come to believe that history is obsolete, and later regretted it.
There's something about that aspect that I am sure is making this phenomenon potentially wilder than the Dot Com crash of 2001.
The idealism is to produce a system for faster, cheaper, and censorship-resistant way to transact. BitCoin is actually becoming unusable for that. It's slower than Etherium, the fees continue to climb when measured against the US Dollar, and the privacy issues are not being addressed.
Sadly, no one will pay any attention to this while the price continues to climb. Only when the price crashes will folks come to their senses, just like when MintPal was hacked which destroyed VeriCoin and when The DAO collapsed with people voting to roll back and fork.
Is that just another component in this house of cards?
If Bitcoin takes a dump, will people panic-sell other cryptos?
If another big crypto explodes, will people panic-sell other cryptos?
The problems and risks in this -- what feels to me, like -- a system, seem interconnected by human psychology if not ACTUAL structures like the exchanges.
I accept $20 bills because I believe other people will accept $20 bills. The paper itself is worthless.
Bitcoin is the same.
It's worth $9,000 as long as enough people believe they can find other people who believe it's worth $9,000.
Meanwhile, trust in governments and banking systems is crumbling. We've seen the hyper inflation in Venezuela. We've seen Saudi Arabia seize 800 billion dollars in assets. We've seen the banking bailouts in the US. As uncertainty rises, a system based on math begins to look like a far safer place to park your wealth.
Belief in Bitcoin may be at an all time high, but it's still the early days. Only 21 million bitcoins will ever be created. Most of them have been mined already & there aren't enough left for every millionaire in the world to own even a single Bitcoin each.
That is a common misconception. Government currency has intrinsic value because you are required to pay your taxes in it. If you live in the US, whatever currency you conduct your business in, be it Bitcoin or gold bullion, the USG wants to be paid in dollars. That creates an intrinsic demand for dollars. That intrinsic demand is what ensures that everyone accepts it as a common form of payment. Because everyone has this same common requirement to pay taxes in USD. People then choose to conduct all business in it simply because it's convenient to do so.
The analog for Bitcoin is a little trickier, but I think an argument you might make is that it costs Bitcoin to move Bitcoin. And therefore there is intrinsic demand for Bitcoin, because the value-transfer capabilities it provides are inherently useful.
Bitcoin has none of that. There's no bailout. There's no economic experts to come in and revise things. There's no political will to exert. Its decentralization is its greatest strength but also its greatest weakness.
This is by design of course. But the argument that it's "just faith" propping up the dollar is fallacious. Apples and oranges.
The real worth of a US dollar bill comes from the US military. In case the value of USD starts going down, the military will do whatever is "necessary" to restore economic order.
Another example. Suppose a bunch of terrorists crash a couple of planes into a symbol of American economic strength. Again, US drones and boots on the ground would fuck up whatever corner of the earth that needs to be obliterated in order to restore people's faith.
These two are very direct actions, but most influences are far more subtle. What happens if China tries to manipulate US currency using its vast dollar reserves? It won't, because within hours a couple of aircraft carriers would show up inside Chinese sea waters. Just the existence of capability is enough to deter China.
When suckers enter, smart money leaves.
It's a very interesting technology which will continue to exist but it's really looks like an out of control bubble. In some ways it would be better for it to implode and get the snake oil salesman and sketchy white papers out of the ecosystem.
It used to be a really cool proving ground for cutting edge technologies but now it's looking more like rampant greed, excess and arrogance.
To liquidate your position and to make a profit you need constant inflow of new investors to keep the market going as BTC has no true value. There's no backing of any hard assets.
The revenue stream is based on new investments rather than the underlying product itself. That's a very common pyramid scheme/multi level marketing scenario.
This is very different from company stocks, as the stock unit itself is a guarantor of dividends and a small part ownership of the assets of a company. Its price is representative of the performance of the company, it is not the product itself. That company produces something (in theory), although to cash out you still need to find someone to buy it at a said price.
I really don't see it personally. It seems pretty clear people are buying and holding en mass at this point and it just seems like pure FOMO. There is no underlying asset and I don't think its that useful for replacing cash. Not going to complain though. I'll go on, take my money and run.
especially the Q&A after the talk. Its extremely thought provoking