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Bitcoin Is an Escapist Safe Haven

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Re: Bitcoin Is an Escapist Safe Haven

#111

Post by runeks »

parceltape wrote: post #103

"The virtual currency's value rests, in the final analysis, on nothing but the faith of the community that supports it. The faith can be relatively easy to undermine, of course. In 2013, bitcoin plummeted from its high because of a December move by the People's Bank of China, which banned mainland banks from dealing in the cryptocurrency." Is this not a contradiction? Clearly it shows the value of Bitcoin responds to…

It's a recursive definition, at least. They say the value rests on the faith of the community, and that this faith can be undermined by a change in value/price. But I guess this is an accurate description of the value of money: it's worth something because it's worth something.

Re: Bitcoin Is an Escapist Safe Haven

#112

Post by runeks »

bduerst wrote: post #13
baddox wrote: post #12

Earlier quoted context omitted.

> It also has no scarcity since it can face competition by an infinite number of similar conceivable algorithms / block-chains / virtual currencies that offer much the same features, regardless of how hard its own mining gets. I don't get this argument. Competing cryptocurrencies won't be spendable on the Bitcoin block chain and vice versa, so Bitcoin's scarcity isn't compromised. It's true that Bitcoin could face co…

They're referring to any unique characteristics that give Bitcoin value in competing with other cryptocurrencies, which is mostly true. There are already a number of newer cryptocurrencies that are better than bitcoin (e.g. no block size issue, computational waste, etc.) but with bitcoin it will take more than that to dethrone Bitcoin's brand as "Internet Drug Money".

> They're referring to any unique characteristics that give Bitcoin value in competing with other cryptocurrencies, which is mostly true.

The unique characteristic that makes Bitcoin more valuable than all other cryptocurrencies is liquidity. The order book depth for the USD/EUR Bitcoin market is more than an order of magnitude greater than all other cryptocurrencies combined.

The more liquid a monetary unit is, the less friction is involved in using it for exchange, since you pay the spread (which increases with order size) every time you enter and leave the Bitcoin market.

This is the only reason gold is still so valuable: it has immense liquidity/market depth, meaning you can quickly offload it on the market when needed. This is very useful, and the defining property of money.

Re: Bitcoin Is an Escapist Safe Haven

#113

Post by bduerst »

TGilmour wrote: post #110
bduerst wrote: post #109

Earlier quoted context omitted.

Payment systems aren't successful by failing transactions. That's definitively not working, no matter how you spin it. The end result of not accepting BIP is failing transactions. We know this, because it even happened to NPR. Who are you really trying to convince here? You're also confusing asset value with success for a currency, even as we're entering a Bitcoin bubble from the Yuan crash. Show me a successful deve…

It's too bad the NPR didn't provide a tx id so we could see the issue, we just have to take their word for it? I think it's a terrible example with no evidence. It makes for a very weak argument. Not accepting BIPs and failing transactions aren't mutually exclusive, you can't assert that something that hasn't happened caused something else. I'm not trying to convice anyone of anything, just point out how wrong you ar…

I think at this point, by questioning whether or not NPR is lying about Bitcoin, you're demonstrating confirmation bias. A better question would be: How much do you personally have invested into Bitcoin that relies on it's success?

Re: Bitcoin Is an Escapist Safe Haven

#114

Post by TGilmour »

bduerst wrote: post #113
TGilmour wrote: post #110

Earlier quoted context omitted.

It's too bad the NPR didn't provide a tx id so we could see the issue, we just have to take their word for it? I think it's a terrible example with no evidence. It makes for a very weak argument. Not accepting BIPs and failing transactions aren't mutually exclusive, you can't assert that something that hasn't happened caused something else. I'm not trying to convice anyone of anything, just point out how wrong you ar…

I think at this point, by questioning whether or not NPR is lying about Bitcoin, you're demonstrating confirmation bias. A better question would be: How much do you personally have invested into Bitcoin that relies on it's success?

I'm not saying NPR is lying, but your argument is based on it being a fact that a TX has failed, where we don't have the details of that TX or if it exists. I also don't think you understand what confirmation bias is.

I don't mind disclosing have holdings in XBT, ETH, DASH, XRP, and others. None of my investment portfolio relies on Bitcoin increasing in value significantly, crypto is a small percentage of my overall portfolio. I've also been paid in bitcoin for over a year and won't sell for years. It's evident you're just here to get rich quick.

Re: Bitcoin Is an Escapist Safe Haven

#115

Post by [deleted] »

pg314 wrote: post #99
bduerst wrote: post #30

Earlier quoted context omitted.

We're entering a new bubble, this one being driven as the Yuan crashes: https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&... Just because it's being repeated doesn't mean it's wrong.

What constitutes a crash for the Yuan (3% over 3 months), is way less than the volatility of bitcoin in one day...

[deleted]

Re: Bitcoin Is an Escapist Safe Haven

#116

Post by bduerst »

pg314 wrote: post #99
bduerst wrote: post #30

Earlier quoted context omitted.

We're entering a new bubble, this one being driven as the Yuan crashes: https://www.google.com/finance?chdnp=1&chdd=1&chds=1&chdv=1&... Just because it's being repeated doesn't mean it's wrong.

What constitutes a crash for the Yuan (3% over 3 months), is way less than the volatility of bitcoin in one day...

I can't tell if you're trying to say if the Yuan didn't crash or something else. Bitcoin's 3 month volatility is 85%.

Re: Bitcoin Is an Escapist Safe Haven

#117

Post by bduerst »

TGilmour wrote: post #114
bduerst wrote: post #113

Earlier quoted context omitted.

I think at this point, by questioning whether or not NPR is lying about Bitcoin, you're demonstrating confirmation bias. A better question would be: How much do you personally have invested into Bitcoin that relies on it's success?

I'm not saying NPR is lying, but your argument is based on it being a fact that a TX has failed, where we don't have the details of that TX or if it exists. I also don't think you understand what confirmation bias is. I don't mind disclosing have holdings in XBT, ETH, DASH, XRP, and others. None of my investment portfolio relies on Bitcoin increasing in value significantly, crypto is a small percentage of my overall…

Do you think NPR is lying about the transaction failing? (y/n question)

So you have a year's worth of wages tied up in Bitcoin?

Re: Bitcoin Is an Escapist Safe Haven

#118

Post by bduerst »

tlrobinson wrote: post #72
bduerst wrote: post #64

Earlier quoted context omitted.

Sidechains are not a workaround, even ignoring that they're centralized and marketed as such. Sidechains only solve the problem of user scalability, not volume scalability, because they still require the Bitcoin network to verify. For example, on a side chain it would take seconds to make 10,000,000 transactions between 2 people, but making 2 transactions between 10,000,000 people would take over a month.

Sidechains and Lightning Network are not the same thing. https://en.bitcoin.it/wiki/Lightning_Network https://lightning.network/ https://bitcoinmagazine.com/articles/greg-maxwell-lightning-... It's basically a network of "payment channels" you can route instantaneous off-chain payments over, which occasionally settle on the blockchain. And you don't need to trust anyone in the network with your funds.

So it's an alt-coin that still requires bitcoin?

Re: Bitcoin Is an Escapist Safe Haven

#119

Post by ericb »

MarcusBrutus wrote: post #38
ericb wrote: post #18

Earlier quoted context omitted.

Most of the "value" of gold is by arbitrary societal agreement--there is very low natural use-driven demand compared to the froth from people using it as a store of value. That agreement, in a game theory sense, comes from the original time when participants coalesced around gold because it had the properties that seemed most appealing (limited supply, difficult to fake, measurable, transportable) as a store of value…

Scarcity, fungibility, divisibility, durability are not societal constructs. Plus all metals have some inherent value. On top of that you have desirability which you could perhaps explain as a societal construct although I think there is something ingrained in the human psyche about valuing very smooth and shiny things (perhaps there is even an evolutionary explanation). At any rate a societal construct that has pers…

> a societal construct that has persisted for milenia across vast swathes of the globe is not your typical societal construct.

For sure, but until now, gold has not faced an alternative that beat it on a number of objective measures (portability, divisibility, scarcity, durability) so now we get to see the experimental result of what happens over time when there's an alternative that better meets the core use-cases that made it a good choice to a store of value.

Bitcoins have a base level of desirability even without currency use. They offer the ability to write (transact) on a public globally distributed time stamped, unforgeable verified data store.

The blockchain's a perfect place to store the hash of a document, for example, to prove it's existence as of a certain date.

Re: Bitcoin Is an Escapist Safe Haven

#120

Post by Shorel »

alexmingoia wrote: post #55
kristianp wrote: post #43

Earlier quoted context omitted.

"Bitcoin fails to satisfactorily answer von Mises' regression theorem." Can you explain this for the non-economists here please?

Economists (notably Ludwig von Mises and Carl Menger) attempted to answer the question, "Why does money have value?" with the explanation that people have a desire for goods (including money) because of what they use them for. With money, they expect to trade it for other goods in the future. But the problem is that argument is circular when using it to explain the market origination of money: Why did people original…

Good explanation.

Twenty years from now we will know which one has passed the test of time, Mises theorem or Bitcoin intrinsic value defying it, which I postulate is a consequence of their money-like characteristics instead of the correspondence to any physical goods.

This of course also applies to other crypto-currencies. May be any cryptocurrency that's not premined and is owned by a big enough network of people has some intrinsic value > 0, and it may be more related to the network size than to the underlying crypto-algorithm.

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