Bitcoin, Cryptocurrency and Blockchain Discussion Thread

[daniel]

Most of them did and still do. Because right now and at the time very few people accept crypto. But that's okay, they accepted them and if you are gonna bootstrap a currency without force, that's how you do it. As they see that more and more of their expenses could be in crypto, they would start to save more.

But some kept some in crypto mostly as a speculation. This was when the frenzy was high, Bitcoin going from $12 to $1200 in a year. People did notice and wanted to get in the action. When people went to crypto meetups at the only restaurant that accepted Bitcoin in town etc. These guys were sometimes believers themselves, but some only did it to seem modern or to make a quick buck.

Newegg, Overstock, Tesla etc held a lot of their bitcoins at least for a while.

Anyway, lots of these discussion have been held before. Does it matter if prices are in dollar? Does it matter if it's converted to dollars instantly? Etc etc. See these old debates from 2013:

"But some kept some in crypto mostly as a speculation."

Because that's all it is: It's not a currency, it's a Ponzi scheme and some people hope to still make money by not being the last ones in. The only way anybody makes money in crypto is when somebody else forks out their own money for it. It's a zero-sum game and always will be. Speculation on currency is the same, but real money serves a real purpose: mediating trade and financing investment. The wild instability of crypto makes it useless for either.

"Does it matter if prices are in dollar? Does it matter if it's converted to dollars instantly?"

Yes, it matters, because it shows that crypto is useless as currency, except for illegal activities where the wild instability in value is justified by the secrecy. Crypto's only uses are speculation and crime.

 

[Daniel in SD]

SBF arrested in Bahamas. So much for the bizarre theory that his political and media donations would protect him.
Pro tip: Even if you were protected once you can no longer make donations you are no longer protected.

https://twitter.com/x/status/1602448119031021570

Is Binance going down too? I assume it’s also a scam.

 

[daniel]

Is Binance going down too? I assume it’s also a scam.

All crypto is a gigantic scam. Even if a crypto exchange is operating honestly, it's honestly participating in something that's a scam. It's like a gambling casino: Gambling is a scam and casino odds assure that the casino will make money, which it does by taking money from the gamblers. Even if it operates entirely within the law, and admits all the above, and pays out to winners, it's still a scam because it's taking people's money and giving nothing in return. It claims it's providing entertainment, but it's really selling dreams of wealth, and it takes more money from people than it gives back. Crypto is like that: It provides nothing of value, while taking people's money in return for digital tokens whose only "value" is that a bigger fool may buy the token from them. And while a few people actually believe the fringe theory that money should be unregulated, and buy crypto to be a part of some new world order, the vast majority of crypto buyers are in it because they hope to get rich when the bigger fool comes along to buy their coins for a higher price.

So, yes, Binance is a scam. I have no idea whether it's operating dishonestly. But that's irrelevant to the question "Is it a scam?"

 

[dm28997]

Looks like BTC, ETH, DOGE, and others are breaking out. Change is hard to accept and disruption in many areas is here. The future is positive in many areas. I'm concerned about the value of fiat currency mainly due to political issues.

 

[heltok]

Looks like BTC, ETH, DOGE, and others are breaking out. Change is hard to accept and disruption in many areas is here. The future is positive in many areas. I'm concerned about the value of fiat currency mainly due to political issues.

Don't worry, when bitcoin crashes from 60k to 30k there will lots of activity in this thread again.

 

[dm28997]

Banks are having severe liquidity issues with some failures. Lots of speculation about root causes which I have my own theories esp. with the disruption caused by peak oil and ICE vehicle sales declining rapidly. I have started buying some crypto again but keep it in a private ledger and not sell as shorts are also playing games here as they have been in Tesla. Not many are educated in these areas and are swayed with fear and greed. I only have 1% of assets in BTC and ETH and DOGE. With interest rates rising CDs seem safest but for me Tesla is my bigger investment. BTW this isn't advice but my own thoughts. But Peter Lynch gave the best advice that I use. Education helps a lot

 

[jabloomf1230]

Is Ethereum a security?

Deaton Plans to Counter Suit As Regulators Allege Ethereum is Security After XRP

The NYAG alleges that ETH passes Howey's test, positing that it "is a speculative asset that relies on the efforts of third-party developers."

thecryptobasic.com

 

[daniel]

Crypto exchanges don't want to be regulated because they want to be able to play fast and loose with people's money. Out of one side of their mouth they insist that crypto is currency, but out of the other side they promise clients huge profits on the rise in the market value of their coins. Meanwhile, just like any other brokerage, they make their money by charging clients fees for trading, and they invest clients' money for their own (not the clients') profit.

Legitimate brokerages always remind clients of the risks involved. Crypto exchanges, while admitting the risk, insist that in the long term crypto can only go up. Businesses that hold other people's money need to be regulated because the temptations are just too great.

 

[electricar]

Or as PT Barnum said “ There is a sucker born every minute “

 

[dm28997]

I wish I had bought more ETH as it seems to be capitulating. Will be holding for a long long time. Is this a security or a commodity?
Why not a currency? Like the internet, iPhone, Google, Amazon, EVs, etc. digital assets are going to be ignored till they are not.

 

[daniel]

I wish I had bought more ETH as it seems to be capitulating. Will be holding for a long long time. Is this a security or a commodity?
Why not a currency? Like the internet, iPhone, Google, Amazon, EVs, etc. digital assets are going to be ignored till they are not.

Why not a currency?

Because its value is too wildly unstable. For anything to function as currency its value must be relatively stable. Governments work hard to make that happen. An unregulated currency, such as precious metals or crypto, are disastrous as currency. The gold standard contributed greatly to the depth and length of the Great Depression. Crypto is even worse because at least gold has actual uses in addition to being used as currency. Crypto is vapor. There's nothing there but software, and there's no mechanism to hold its value steady.

I wish you the best of luck on your ETH speculation, but it has no use-case as currency, except for cases where the parties to a transaction are willing to risk large changes in valuation in order to keep their transaction secret. Crypto is speculation in ghosts.

 

[dm28997]

I see lack of knowledge or contempt prior to investigation can cause misunderstandings. A simple start is:

What Is Ethereum and What Are Its Use Cases?

Here is a brief summary of a few beneficial use cases and functionalities of Ethereum, which you can use to embed blockchain technologies in your business.

originstamp.com

Also Fidelity has some great explanations about BTC and ETH

Down Homepage

 

[daniel]

I see lack of knowledge or contempt prior to investigation can cause misunderstandings. A simple start is:

What Is Ethereum and What Are Its Use Cases?

Here is a brief summary of a few beneficial use cases and functionalities of Ethereum, which you can use to embed blockchain technologies in your business.

originstamp.com

Interesting. The article points out that a hacker stole 50 million ETH by exploiting a flaw in the software. Somehow we're supposed to believe that there are no more flaws to be found and used to hack the software? We're supposed to believe that correcting that one flaw fixed everything? Every week hackers and security techs find several new, exploitable flaws in Windows, and several new hacks are released by hackers. Cryptocurrencies are just software, and in spite of the claims about how wonderful distributed ledgers are, software can be hacked, and from time to time will be hacked.

(I don't doubt that the concept of distributed ledgers will turn out to have some valid uses. But crypto is not one of them.)

As for use cases, the article just repeats the old claims that crypto is the cure for all our economic problems. It can be used for NFTs, and to make distributed ledgers, etc. But it's still wildly unstable, which makes it useless as currency.

Also Fidelity has some great explanations about BTC and ETH

Down Homepage

Fidelity is a brokerage. They sell securities to investors and speculators. Stocks and bonds can be speculations or investments, depending on whether you intend to attempt to profit from short-term fluctuations in price, or are investing in a company that creates value by making a product or providing a useful service. Crypto is a speculative security.

But at least, as a registered brokerage, Fidelity is regulated as a brokerage, providing some consumer protections, something you don't get from crypto exchanges.

 

[dm28997]

I don't have the time to share this especially how blockchains protect against fraud. I like the fact that BTC is limited to 21 million whereas fiat money is unlimited and gold can be found in new discoveries. It really is needed to understand the mechanisms that make this attractive but if one doesn't understand math or encryption or decentralization then the conversation ends here.

 

[Knightshade]

I don't have the time to share this especially how blockchains protect against fraud.

Especially since their irreversible nature ends up doing the opposite.

If I buy something with a Visa credit card and the item is never sent or is fake, etc....I just tell visa and I get 100% of my money back.

if I buy something with BTC and that happens, I get 0% of my money back.

That's apart from how vastly more expensive and slower in huge #s the transactions are for most crypto as among the added reasons it sucks as money.

 

[daniel]

I don't have the time to share this especially how blockchains protect against fraud. I like the fact that BTC is limited to 21 million whereas fiat money is unlimited and gold can be found in new discoveries. It really is needed to understand the mechanisms that make this attractive but if one doesn't understand math or encryption or decentralization then the conversation ends here.

Oh, you mean it protects against the kind of fraud that SBF pulled off?

Nobody knows for sure how many billions of dollars worth of BTC are lost forever in wallets that people have lost the keys to. Yes, if you are very organized, and extremely vigilant, you can maintain a backup copy of your key in a place that hackers are unlikely to find. But that requires every citizen to be highly organized and vigilant. With my "fiat" money in a bank, if I lose all my passwords, I can simply walk into the bank, prove my identity, and regain control of my accounts.

And BTW, it's a real joke for proponents of crypto to refer to nationally-issued money as "fiat" since crypto is just as much "fiat" as conventional currency. It's a completely arbitrary, unregulated piece of software running on an arbitrary collection of computers. But all money, be it gold, government-issued currency, privately-issued currency, or crypto, has value only because people agree to treat it as though it had value. Only government-issued currency has a mechanism for regulating the supply according to economic conditions. Because any time you have too much money chasing too few goods, or too little money to pay for the available goods, you get a financial crisis. BTC would be a continuous financial crisis because there would never be the correct amount of money in circulation.

It is precisely the (relatively) fixed supply of gold that caused the Great Depression. The money supply MUST be capable of expanding and contracting according to economic conditions for an economy to function. The thing you say is a strength of BTC is in fact one of its greatest weaknesses. It makes it useful as a speculation or a collector's item, but useless as currency.

The fixed quantity of BTC does make it ideal as an instrument for speculation. You can buy it in hopes that a bigger fool will buy it from you later for a higher price, knowing that there will never be more of it than the set limit. And knowing that in fact the total amount will gradually decline as people lose their keys to their wallets, or they die without telling anybody their key.

 

[dm28997]

When Tesla made electric vehicles using laptop batteries there where many sceptical and the slizzy shorters went all in and lost billions.
Who said the Internet is just a fad?
The times they are changing. I wonder how much Confederate dollars are worth today.

 

[Knightshade]

I'll take "nonsensical analogies" for $1000 alex!

Teslas batteries weren't fundamentally worse at the task they were used for than the thing they were trying to replace... (and one can cite actual, real world, reasons they made fundamental sense to use from both cost and engineering perspectives).

Crypto IS fundamentally worse than actual money at the job of being money. And nobody, including you, can provide any fundamental actual real world way it's better. Your last attempt about fraud for example where it is, like in so many ways, worse than real money.

 

[dm28997]

I wonder if the bank crisis had some problems with shorters. As the crypto prices are now skyrocketing perhaps they are getting margin calls?

 

[dm28997]

I'll take "nonsensical analogies" for $1000 alex!

Teslas batteries weren't fundamentally worse at the task they were used for than the thing they were trying to replace... (and one can cite actual, real world, reasons they made fundamental sense to use from both cost and engineering perspectives).

Crypto IS fundamentally worse than actual money at the job of being money. And nobody, including you, can provide any fundamental actual real world way it's better. Your last attempt about fraud for example where it is, like in so many ways, worse than real money.

I have a Coinbase Visa card that works just like a Visa because it is. But it converts crypto to dollars for retail transactions. Heck, I can even use it with my Google Wallet.