Bitcoin - Part 2

[psionl0]

Well, to retain any value at all, it needs to be useful for something,

It is useful for large scale transactions, store of value and speculation, all of which can be conducted anonymously if you know what you are doing.

But that has nothing to do with bitcoin being a "currency".

but I see what you mean.

No you don't.

 

[Andy_Ross]

Bitcoin was one of the topics of conversation in the pub last night. No one seemed to know what it was about but a couple of blokes were going to get in on it. It was a 'sure thing'.
Someone's brother who is ' in computers' knew all about it and says to get in, like him.

 

[Craig B]

It is useful for large scale transactions, store of value and speculation, all of which can be conducted anonymously if you know what you are doing.

But that has nothing to do with bitcoin being a "currency".


No you don't.

I'll let you argue with https://www.investopedia.com/terms/c/cryptocurrency.asp about whether Bitcoin is a currency, and I'll ignore the rest of your post until you see fit to explain it.

 

[ponderingturtle]

Well, to retain any value at all, it needs to be useful for something, but I see what you mean. This from CNBC

An early bitcoin investor said Monday the digital currency can run higher, but the hype has far outpaced its usability.

"I think in the short run it can run up a lot more," Roger Ver, CEO of Bitcoin.com, said Monday on CNBC's "Fast Money." But "it's no longer a cryptocurrency. It's just a game of hot potato at this point, and games of hot potatoes can go on for a long time, and lots of people can pump a lot of money into it and it might go on for even decades. But as far as its [being] used as money, the developers behind that have destroyed that at this point."​

That seems to be the problem, it is a commodity with no fundamental utility to set a base price that speculators can drive up. As it is going to crash again probably soon like in the past when it lost 80% of its value overnight.

 

[Tippit]

Well, to retain any value at all, it needs to be useful for something, but I see what you mean. This from CNBC

An early bitcoin investor said Monday the digital currency can run higher, but the hype has far outpaced its usability.

​

Bitcoin is useful for moving wealth outside of repressive government regimes and capital controls. Does anyone actually read the posts in this forum?

"I think in the short run it can run up a lot more," Roger Ver, CEO of Bitcoin.com, said Monday on CNBC's "Fast Money." But "it's no longer a cryptocurrency. It's just a game of hot potato at this point, and games of hot potatoes can go on for a long time, and lots of people can pump a lot of money into it and it might go on for even decades. But as far as its [being] used as money, the developers behind that have destroyed that at this point."[/indent]

I watched the Ver interview. In all likelihood, he is just talking his book. My friend the bitcoin whale told me that Ver has conspired with a bitcoin miner in China to pump Bitcoin Cash, which due to the fork offers them a lot of control. I don't fully understand the technical reasons why, but I can find out.

 

[Craig B]

Bitcoin is useful for moving wealth outside of repressive government regimes and capital controls. Does anyone actually read the posts in this forum?

If it is useful for that purpose I suggest that it deserves to be called a "currency".

I watched the Ver interview. In all likelihood, he is just talking his book. My friend the bitcoin whale told me that Ver has conspired with a bitcoin miner in China to pump Bitcoin Cash, which due to the fork offers them a lot of control. I don't fully understand the technical reasons why, but I can find out.

When you come to acquire that understanding, I would be grateful if you could enlighten me on this subject.

 

[psionl0]

I'll let you argue with https://www.investopedia.com/terms/c/cryptocurrency.asp about whether Bitcoin is a currency, and I'll ignore the rest of your post until you see fit to explain it.

The question was whether bitcoin should have "usefulness as a currency" - not whether it meets the technical definition of "currency" according to some dictionary or web site.

I prefer to adhere to the mathematics of it and leave these semantic arguments to others.

 

[Craig B]

The question was whether bitcoin should have "usefulness as a currency" - not whether it meets the technical definition of "currency" according to some dictionary or web site.

I prefer to adhere to the mathematics of it and leave these semantic arguments to others.

No you don't. You're telling fibs. because you have written that

It is useful for large scale transactions, store of value and speculation, all of which can be conducted anonymously if you know what you are doing.

But that has nothing to do with bitcoin being a "currency".​

No "mathematics" there that I can see.

 

[psionl0]

No you don't. You're telling fibs.

What do you want to get from me? Do you want to discuss whether bitcoin is issued by a central authority or whether you can pay taxes with it or something?

I would say that something is a "currency" if it is widely used as a currency. Bitcoin currently doesn't meet that standard. That doesn't mean that bitcoin is useless.

 

[Craig B]

What do you want to get from me? Do you want to discuss whether bitcoin is issued by a central authority or whether you can pay taxes with it or something?

I would say that something is a "currency" if it is widely used as a currency. Bitcoin currently doesn't meet that standard. That doesn't mean that bitcoin is useless.

What then is it useful for? Are not sellers of various goods and services accepting it as a medium of payment? I haven't raised the issue of whether it is issued by a central authority or whether you can pay taxes with it. Are these defining features of currency in your understanding of the term?

 

[psionl0]

Now you are just playing dumb.

 

[Craig B]

Now you are just playing dumb.

My question was serious. If you don't want to respond, that's your right.

 

[psionl0]

My question was serious. If you don't want to respond, that's your right.

I gave straight forward answers to your questions. Your response was to paraphrase your questions as if I didn't.

That is a game that I am not interested in playing.

 

[Craig B]

I gave straight forward answers to your questions. Your response was to paraphrase your questions as if I didn't.

That is a game that I am not interested in playing.

It is not a game, but it's up to you whether you respond to posts or not.

This looks like a bubble, and I will be most surprised if it turns out to be anything different.

 

[The_Animus]

It seems to me that the energy usage is the only real reason bitcoin will eventually die

If another crypto currency can get as big as bitcoin without that drawback I think it would be unstoppable

 

[psionl0]

This looks like a bubble, and I will be most surprised if it turns out to be anything different.

I see. All this silliness about whether bitcoin was a currency or not was just an attempt to divert attention away from post #1019 where I said that bitcoin was probably in a bubble but it will most likely recover from the next price shock - again.

 

[psionl0]

It seems to me that the energy usage is the only real reason bitcoin will eventually die

Increasing energy costs and diminishing block rewards are more likely to see mining level off than to "kill" bitcoin.

If another crypto currency can get as big as bitcoin without that drawback I think it would be unstoppable

"Proof of Stake" and "consenus" are two alternatives that don't require escalating power usage.

"Consensus" as used in the Ripple network seems to be the best alternative but it doesn't address how to allocate block rewards.

 

[Thabiguy]

It seems to me that the energy usage is the only real reason bitcoin will eventually die

If another crypto currency can get as big as bitcoin without that drawback I think it would be unstoppable

I don't think bitcoin needs to ever die. Let's say there is a big crash - bigger than any crash before. The price of a bitcoin falls to $0.1. The internet is flooded with articles about people who have lost fortunes, and pull their hair out over having bought it. Surely that means bitcoin has failed miserably and will never recover, right?

Well, in my opinion, no. Even if all that happens, there is no reason why bitcoin can't rise all over again. And it doesn't even need to come up with a new narrative - the promoters can just keep promising the same old thing, that it will one day become universally accepted decentralized digital currency.

And it doesn't matter for how long it has failed to achieve that. Has homeopathy ever produced an effective cure for anything? Has any spiritualist ever been able to contact a dead person? Of course not - but that's not going to deter the customers. As long as the promise is attractive, people will keep flocking to it.

Bitcoin is a game, a novel way of gambling. Crashes mean nothing; losing money has never dissuaded people from gambling, and failure to fulfill promises has never dissuaded people from following prophets - as long as they keep promising. And since there isn't a single central authority that could die, or be arrested, or take all the money and disappear for good, bitcoin may stay around indefinitely, peaking and crashing in ever-merry cycles. Just as long as people find the promise of replacing the crooked financial "system" (and making some effortless money while at it) appealing.

 

[Craig B]

I see. All this silliness about whether bitcoin was a currency or not was just an attempt to divert attention away from post #1019 where I said that bitcoin was probably in a bubble but it will most likely recover from the next price shock - again.

What are you on about now? The question whether you think bitcoin is a currency or not, and why, is both relevant and interesting to why you think it will survive, which it may. Is its function that of a currency? If not, what is it? These questions are relevant both to its real value, if it has one, and its survival potential - as must surely be evident.

The definition of a bubble is whether current investors in the affected asset stand to suffer irretrievable loss of a significant part of their investment, not whether the brand will survive. I think people who have bought Bitcoin at say $15,000 are at risk of suffering such loss. I would be surprised if they come out unscathed.

 

[Craig B]

I don't think bitcoin needs to ever die. Let's say there is a big crash - bigger than any crash before. The price of a bitcoin falls to $0.1. The internet is flooded with articles about people who have lost fortunes, and pull their hair out over having bought it. Surely that means bitcoin has failed miserably and will never recover, right?

Well, in my opinion, no. Even if all that happens, there is no reason why bitcoin can't rise all over again. And it doesn't even need to come up with a new narrative - the promoters can just keep promising the same old thing, that it will one day become universally accepted decentralized digital currency.

And it doesn't matter for how long it has failed to achieve that. Has homeopathy ever produced an effective cure for anything? Has any spiritualist ever been able to contact a dead person? Of course not - but that's not going to deter the customers. As long as the promise is attractive, people will keep flocking to it.

Bitcoin is a game, a novel way of gambling. Crashes mean nothing; losing money has never dissuaded people from gambling, and failure to fulfill promises has never dissuaded people from following prophets - as long as they keep promising. And since there isn't a single central authority that could die, or be arrested, or take all the money and disappear for good, bitcoin may stay around indefinitely, peaking and crashing in ever-merry cycles. Just as long as people find the promise of replacing the crooked financial "system" (and making some effortless money while at it) appealing.

From "CIty AM"

You hear the dreaded words: “this time it’s different”.

During every asset bubble, you will find scores of professionals telling you that it isn’t a bubble; this time, it’s a real and important forward step in technology.

This is very confused. The fact that there’s a genuine step forward doesn’t mean it can’t be a bubble.
There was a railroad bubble back in the 1870s in which thousands of small investors were wiped out. That didn’t mean that the railroad wasn’t the future of transport. And the dotcom bubble of the 1990s didn’t mean that the internet had no future.​