Crypto Currency Thread

[Behemoth]

p1stonhead said:

So its not anonymous, you cant spend it anywhere and the value rises and falls like a rollercoaster daily if not hourly meaning its not an investment sensible people would get involved in either unless for a pure gamble.

What are the supposed benefits?

Volatility is a completely expected and natural feature of any new asset that is subject to a high degree of speculation whilst markets assess its value. If you can't accept the volatility, I'd certainly steer very well clear.

The benefit of Bitcoin is very long term.

It's clear that digital money is here to stay. Of course, we already have digital money with our contactless cards and computerised bank accounts. What we haven't previously had, though, is a bullet proof currency that no government controls. The benefit of a currency that no government controls is that (if structured in the right way) no government or grouping of governments can inflate it by agreeing to print up new money.

History shows that for millennia, societies across the planet have always moved to adopt the money that is the most difficult for their societies and enemies to manipulate. As soon as a new form of money appears that is harder to manipulate, a society tends moves towards it.

[p1stonhead]

Behemoth said:

p1stonhead said:

So its not anonymous, you cant spend it anywhere and the value rises and falls like a rollercoaster daily if not hourly meaning its not an investment sensible people would get involved in either unless for a pure gamble.

What are the supposed benefits?

Volatility is a completely expected and natural feature of any new asset that is subject to a high degree of speculation whilst markets assess its value. If you can't accept the volatility, I'd certainly steer very well clear.

The benefit of Bitcoin is very long term.

It's clear that digital money is here to stay. Of course, we already have digital money with our contactless cards and computerised bank accounts. What we haven't previously had, though, is a bullet proof currency that no government controls. The benefit of a currency that no government controls is that (if structured in the right way) no government or grouping of governments can inflate it by agreeing to print up new money.

History shows that for millennia, societies across the planet have always moved to adopt the money that is the most difficult for their societies and enemies to manipulate. As soon as a new form of money appears that is harder to manipulate, a society tends moves towards it.

Its not money. You cant spend it anywhere (apart from very select places). How is it any different from someone deciding football stickers are a new currency and the price going mad daily like bitcoin? Some boutique cafe's may accept them one day, but you cant spend a picture of David Beckham down tesco.

[Behemoth]

p1stonhead said:

Its not money. You cant spend it anywhere (apart from very select places). How is it any different from someone deciding football stickers are a new currency and the price going mad daily like bitcoin? Some boutique cafe's may accept them one day, but you cant spend a picture of David Beckham down tesco.

My view is long term. It seems you either didn't read my post or you didn't understand it.

[dimots]

Behemoth said:

Of course, we already have digital money with our contactless cards and computerised bank accounts.

We don't have digital money though...we have credit cards, banks and websites which have been cobbled together to create a pretty stty system. Nothing comes close to bitcoin from a security perspective. Nothing else has an unhackaed ledger of transactions...in fact most SWIFT hacks are not even disclosed. I would love to see a ledger of all SWIFT transactions...i bet about 50% are fraudulent!

[Badda]

dimots said:

I would love to see a ledger of all SWIFT transactions...i bet about 50% are fraudulent!

Now that's being ridiculous.

[Behemoth]

zubzob said:

Does history show many examples of a deflationary currency being adopted successsfully

It's actually the onset of inflation that tends to push a society onto something else (something I witnessed directly a while ago, with hyperinflation leading to dollarisation). The idea that moderate inflation is the solution to all ills is a relatively recent concept. Whilst they obviously work really well as a medium of exchange, modern currencies are not good stores of value. Even minimal inflation destroys generational nest eggs. This is why there's such a strong market in rare objects, unique artwork & property.

Nick Szabo created a failed precursor to Bitcoin called Bit Gold & wrote this fascinating essay on the history of money in the early 2000s: https://nakamotoinstitute.org/shelling-out/

[p1stonhead]

Behemoth said:

p1stonhead said:

Its not money. You cant spend it anywhere (apart from very select places). How is it any different from someone deciding football stickers are a new currency and the price going mad daily like bitcoin? Some boutique cafe's may accept them one day, but you cant spend a picture of David Beckham down tesco.

My view is long term. It seems you either didn't read my post or you didn't understand it.

What do you think will change in Bitcoin long term? Its still 'held' and not spend (ignoring that it cant really be spent) due to it being so volative. Do you think the volatility will end and why? Why would people adopt a deflationary currency which would be worth more tomorrow?

[Some Gump]

zubzob said:

I do wonder about flat earthers, how they can hold options in face of such monumental opposition from ‘experts’.

Similarly there are 1000s upon 1000s of experts who clearly explain why bitcoin is untenable at best, and at worst, a huge huge scam. Yet people believe it, and cite wacky articles from 2002 as evidence.

It’s incredible really.

you clearly either missed the point, lacked the intelligence to understand it, or failed to take a long term view. Bitcoin is the future. Its doesnt matter if it has a use or not now, the uses for it in the future are clear.for all to see. I shouldn't have to spell them out for you.

[Behemoth]

p1stonhead said:

What do you think will change in Bitcoin long term? Its still 'held' and not spend (ignoring that it cant really be spent) due to it being so volative. Do you think the volatility will end and why? Why would people adopt a deflationary currency which would be worth more tomorrow?

What is changing in Bitcoin long term are the technology and regulatory infrastructures to support its use. These drive adoption and both are moving ahead slowly but surely. The first use will be the store & transfer of wealth (this already happens on a limited scale). It will take quite a while longer before something like Bitcoin becomes a commonly used medium of exchange and even longer before it is recognised as a unit of account (if ever).

Volatility will ease off naturally as the market finds its price. Price discovery has a natural path from shaky to smooth, jolted again whenever there's a major fundamental change. I expect many more of these volatile phases to come with Bitcoin before it settles out.

If you have something valuable that will be worth more tomorrow, that doesn't mean you will never sell it. That has never been the case with valuables. It just means you are more careful about spending. The extreme opposite of this is when a currency undergoes hyperinflation. In Caracas, people are queuing up to spend their Bolivars first thing in the morning before the ticket boys run round the store inflating prices for staple goods by the afternoon.

Why do you move money from your savings accounts or cash in your investments to buy something, when leaving it where it is would be worth more tomorrow? In a currently hypothetical far future Bitcoin dominated economy, people won't stop spending to live their lives. They will just think a bit more carefully beforehand & will think even more carefully before borrowing to spend. It's probable this future won't fully come to pass in my lifetime, but I think it's ultimately inevitable, regardless of where you stand on the economics.

[p1stonhead]

Some Gump said:

zubzob said:

I do wonder about flat earthers, how they can hold options in face of such monumental opposition from ‘experts’.

Similarly there are 1000s upon 1000s of experts who clearly explain why bitcoin is untenable at best, and at worst, a huge huge scam. Yet people believe it, and cite wacky articles from 2002 as evidence.

It’s incredible really.

you clearly either missed the point, lacked the intelligence to understand it, or failed to take a long term view. Bitcoin is the future. Its doesnt matter if it has a use or not now, the uses for it in the future are clear.for all to see. I shouldn't have to spell them out for you.

clear for all to see!

[Behemoth]

zubzob said:

people believe it, and cite wacky articles from 2002 as evidence.

It’s incredible really

The essay from Szabo is packed with historical facts that are well referenced and contains superb insights. I don't think any monetary academic would describe it as wacky. Personally, I'd shell out good money for it. You probably don't know why I wrote that, since I doubt you read the essay.

[paulrockliffe]

Some Gump said:

zubzob said:

I do wonder about flat earthers, how they can hold options in face of such monumental opposition from ‘experts’.

Similarly there are 1000s upon 1000s of experts who clearly explain why bitcoin is untenable at best, and at worst, a huge huge scam. Yet people believe it, and cite wacky articles from 2002 as evidence.

It’s incredible really.

you clearly either missed the point, lacked the intelligence to understand it, or failed to take a long term view. Bitcoin is the future. Its doesnt matter if it has a use or not now, the uses for it in the future are clear.for all to see. I shouldn't have to spell them out for you.

I think anyone that expects that wider society will approve of a new financial system that allows early adopters to walk off with a huge proportion of the value, without leaving a way for society to redress that imbalance is more likely to be failing to take the long-view.

What I mean is, you have lots of bitcoin and no assets, I have no bitcoin and £300k in assets. How do we revalue my assets into bitcoin without you giving me yours? And you're not going to give them to me are you obviously.

But then I (and 10s of millions like me) are going to ensure that the future isn't bitcoin, or anything else that magically creates value using algorithms that are divorced from the current distribution of wealth.

Blockchain has a future, but this stuff is going nowhere in the longterm. Sorry.

[Condi]

Behemoth said:

What is changing in Bitcoin long term are the technology and regulatory infrastructures to support its use. These drive adoption and both are moving ahead slowly but surely. The first use will be the store & transfer of wealth (this already happens on a limited scale). It will take quite a while longer before something like Bitcoin becomes a commonly used medium of exchange and even longer before it is recognised as a unit of account (if ever).

Its a terrible store of wealth when daily vol can be +/- 10%. Who on earth wants to be paid in something which could be worth 10% less tomorrow, and how are shops going to price anything without referencing a dollar value. If you're referencing a dollar value, you may as well use dollars.

Behemoth said:

Volatility will ease off naturally as the market finds its price. Price discovery has a natural path from shaky to smooth, jolted again whenever there's a major fundamental change. I expect many more of these volatile phases to come with Bitcoin before it settles out.

Okay, do some fundamental analysis of bitcoin? What says it has any value at all, and how are you valuing it, fundamentally? (The same can be said of any currency, since they removed the Gold Standard, but at least with Sterling the government backs it with their debt.)

Behemoth said:

If you have something valuable that will be worth more tomorrow, that doesn't mean you will never sell it. That has never been the case with valuables. It just means you are more careful about spending. The extreme opposite of this is when a currency undergoes hyperinflation. In Caracas, people are queuing up to spend their Bolivars first thing in the morning before the ticket boys run round the store inflating prices for staple goods by the afternoon.

Neither hyperinflation, nor deflation, are good for the economy. But the alternative to deflation isnt hyperinflation, its a steady 2% inflation which is what most developed economies aim for. To suggest that hyperinflation is at all linked to the argument is simply wrong, and how many advanced and developed economies go through hyperinflation? Non. Look at it this way, if a TV was £500 today, but with deflationary money was going to cost £450 in 6 months time, whats the incentive to buy it now? There isnt one, and the whole money supply becomes locked away as it gradually increase in value. Money isnt supposed to be a 'valuable' in the same way that antique cars are - money is supposed to be traded, sold, and used. Hence why the whole concept of interest exists.

Behemoth said:

Why do you move money from your savings accounts or cash in your investments to buy something, when leaving it where it is would be worth more tomorrow? In a currently hypothetical far future Bitcoin dominated economy, people won't stop spending to live their lives. They will just think a bit more carefully beforehand & will think even more carefully before borrowing to spend. It's probable this future won't fully come to pass in my lifetime, but I think it's ultimately inevitable, regardless of where you stand on the economics.

How can you argue anything 'regardless of where you stand on the economics'?! Thats a ridiculous statement but probably sums up the attitude and knowledge of many bitcoin evangelists. You're talking about something you think will replace money, and then quantify it with 'regardless of economics'? Quite simply, if the economics of it dont make sense (which they dont), it will never catch on among people who understand how financial systems work, and without the backing of a government (the very thing bitcoin wants to avoid), the whole project is going nowhere.

[Behemoth]

paulrockliffe said:

I think anyone that expects that wider society will approve of a new financial system that allows early adopters to walk off with a huge proportion of the value, without leaving a way for society to redress that imbalance is more likely to be failing to take the long-view.

What I mean is, you have lots of bitcoin and no assets, I have no bitcoin and £300k in assets. How do we revalue my assets into bitcoin without you giving me yours? And you're not going to give them to me are you obviously.

But then I (and 10s of millions like me) are going to ensure that the future isn't bitcoin, or anything else that magically creates value using algorithms that are divorced from the current distribution of wealth.

Blockchain has a future, but this stuff is going nowhere in the longterm. Sorry.

"blockchain not bitcoin" shows a lack of understanding. The two are implicitly tied. A blockchain on its own as a data structure is a really inefficient tool. A valuable asset is needed as part of the system as it's the basis for establishing consensus amongst adversaries about the database contents. Blockchains are used in Bitcoin as a route to decentralisation, which is necessary to prevent any single entity having the power of veto to go into the database and change transaction records to their liking.

Capitalism rewards risk. Saying "it's not fair I don't have any" is a bit like saying "give me my fair proportion of Amazon stocks: it's not fair you made an extremely risky investment decades ago which is now successful". If the currency comes to anything, Bitcoin will be there to be earnt or bought just like any other money. If you want fair redistribution, then maybe go live in Caracas and hope for the best

[Behemoth]

Condi said:

How can you argue anything 'regardless of where you stand on the economics'?! Thats a ridiculous statement but probably sums up the attitude and knowledge of many bitcoin evangelists. You're talking about something you think will replace money, and then quantify it with 'regardless of economics'? Quite simply, if the economics of it dont make sense (which they dont), it will never catch on among people who understand how financial systems work, and without the backing of a government (the very thing bitcoin wants to avoid), the whole project is going nowhere.

People obviously have to live within the boundaries of society. If an economic direction is inevitable, you will have to live within that world. You may want to fight your monetarist corner because it seems the best thing invented, but if society moves elsewhere, then you'll have to move with it. I very much doubt 2% inflation target monetarism will last forever. It's too prone to democratic failures, even amongst developed nations.

[paulrockliffe]

Behemoth said:

"blockchain not bitcoin" shows a lack of understanding. The two are implicitly tied. A blockchain on its own as a data structure is a really inefficient tool. A valuable asset is needed as part of the system as it's the basis for establishing consensus amongst adversaries about the database contents. Blockchains are used in Bitcoin as a route to decentralisation, which is necessary to prevent any single entity having the power of veto to go into the database and change transaction records to their liking.

Capitalism rewards risk. Saying "it's not fair I don't have any" is a bit like saying "give me my fair proportion of Amazon stocks: it's not fair you made an extremely risky investment decades ago which is now successful". If the currency comes to anything, Bitcoin will be there to be earnt or bought just like any other money. If you want fair redistribution, then maybe go live in Caracas and hope for the best

Plenty of uses for Blockchain that don't involve new currencies. You don't have to have a coin with your chains.

Rewarding risk isn't the fundamental essence of Capitalism, the clue is in the name. I'm sure you can find examples of capital risk that aren't reward and even some that are where you disagree with the level of reward. Amazon's share price is based on real people doing real work, with a hard link to things that society values. Bitcoin has none of that, so I'm not really sure why you would make that comparison?

You've missed the point spectacularly, I don't want redistribution, that's what Bitcoin is trying to achieve. That's what investors are aiming for, even if they don't understand it. I want the status-quo, where my assets have the same value.

My point was that Bitcoin cannot succeed, because the only people that want it to are those hoping to make off with the spoils. You'll have to sell it to the masses if they're prepared to let you take their assets because you bought a daft computer 30 years in the past.

[Behemoth]

paulrockliffe said:

Plenty of uses for Blockchain that don't involve new currencies. You don't have to have a coin with your chains.

Rewarding risk isn't the fundamental essence of Capitalism, the clue is in the name. I'm sure you can find examples of capital risk that aren't reward and even some that are where you disagree with the level of reward. Amazon's share price is based on real people doing real work, with a hard link to things that society values. Bitcoin has none of that, so I'm not really sure why you would make that comparison?

You've missed the point spectacularly, I don't want redistribution, that's what Bitcoin is trying to achieve. That's what investors are aiming for, even if they don't understand it. I want the status-quo, where my assets have the same value.

My point was that Bitcoin cannot succeed, because the only people that want it to are those hoping to make off with the spoils. You'll have to sell it to the masses if they're prepared to let you take their assets because you bought a daft computer 30 years in the past.

A blockchain without a valuable asset securing it in order to achieve consensus amongst adversaries is just a pointlessly slow and expensive database.

There will not be any day where someone forces you to swap your sterling for some lesser value of Bitcoin, so I don't know what your fear is. I read a piece this week about someone who sold all their Bitcoin a few years ago at $300 because it had dropped from an $800 bubble. Those Bitcoin were doubtless then picked up by someone else who valued them more highly. So it goes.

Speculation on Amazon shares did not require work, it required capital. The value of Bitcoin, like any money, is intrinsic. It's worth whatever society wants it to be worth. Bitcoin's aim is not redistribution of wealth but a robust form of money that is not controlled by government.

Edited by Behemoth on Thursday 13th September 13:22

[Behemoth]

zubzob said:

I'm curious. In the last 20 years, have you ever held views that could be classed as conspiracy theories in other areas?

How many times in the past 20 years have you attempted to win a debate with a crude ad hominem attack? On your bike I'd much prefer rational debate to wild stabs at personal character assassinations.

[Behemoth]

zubzob said:

I’ll take that as a yes

No you won't. You'll move onto proper debate or troll elsewhere.

[NRS]

dimots said:

Behemoth said:

Of course, we already have digital money with our contactless cards and computerised bank accounts.

We don't have digital money though...we have credit cards, banks and websites which have been cobbled together to create a pretty stty system. Nothing comes close to bitcoin from a security perspective. Nothing else has an unhackaed ledger of transactions...in fact most SWIFT hacks are not even disclosed. I would love to see a ledger of all SWIFT transactions...i bet about 50% are fraudulent!

Theoretically. In reality Bitcoin has an issue with your exchange being hacked, your hard disk corrupting, your house catching fire and destroying the disk etc. With no back up. Not to mention the general massive drop in price recently wiping out a lot of your savings even if it is still accessible to you.