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Is There a Cryptocurrency Bubble? Just Ask Doge

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Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#101

Post by hiram112 »

aplummer wrote: post #95
koonsolo wrote: post #83

Earlier quoted context omitted.

> it's relying on "people thinking X has value" Where do dollars or euro's get their value from? Let me give you the wikipedia definition: "Fiat money is a currency without intrinsic value established as money by government regulation or law." What do you think happens to fiat money when people stop believing it has value? Look back to 19th century France, were fiat money collapsed. Bitcoins have no intrinsic value,…

I agree with what you are saying to an extent (it is just paper), however at a minimum the value of government backed money could possibly be expressed by the mobilisation of resources a government would rally to give it value. Lets say everyone declares USD is worthless, the government could 1) sell things of value demanding explicitly USD in return. 2) Impede movement or other activities, use of public goods using…

I've heard it mentioned various times that a fiat currency's value in any organized society comes from its ability to pay off the controlling state (i.e. taxes).

Whether it is dollars to the IRS, colored beads to the local chieftains, or copper coins to the Lord of the manor, it doesn't make a difference. The ability to 'pay off' the state in power, with legal permission and ability to use violence, gives that currency value.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#102

Post by SomeStupidPoint »

koonsolo wrote: post #87
hn_throwaway_99 wrote: post #63

Earlier quoted context omitted.

> Bitcoin made currency decentralised and permissionless. This is a common misconception, that cryptocurrencies can somehow exist outside government control, and it makes me doubt some of the long term value of Bitcoin. A government can basically make anything it wants illegal, and once cryptocurrencies become large enough, there will be tons of additional regulations and control.

Like downloading movies and mp3's?

...yes?

The friction of government control is partly what allows things like Netflix, Hulu, et al to survive. If there were no copyright, then you'd seen tools that were just as good thrive on various p2p backbones.

Instead, the pressure from law enforcement on developers, big libraries of content, indexers, etc keeps the experience of for pay sites better for most people, and so most people just pay whatever streaming website.

Sometimes law enforcement isn't about winning ever battle so much as tilting economic scales.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#103

Post by SomeStupidPoint »

csallen wrote: post #72
josu wrote: post #65

Earlier quoted context omitted.

Drugs are illegal almost everywhere in the world and they are one of the largest consumer markets. Something similar happens to US dollars in Venezuela. So I don't know if making bitcoin illegal will really hurt its value in the long run.

Your conclusion doesn't follow your observation. It's one thing to say that the government can't stop something, and quite another to say the government can't hurt it. Who knows how much bigger the drug trade would be without anti-drug laws.

> Who knows how much bigger the drug trade would be without anti-drug laws.

In a few years we'll have a good idea based on marijuana in several US states. We will have to sift out the tourists though, because there do seem to be a lot of those. At least, here.

We could also look at alcohol prohibition for a historic example.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#104

Post by yxhuvud »

craigc wrote: post #6

I think there is a difference between a cryptocurrency bubble and an ICO bubble, and this article fails to distinguish between the two. You can see Tom Lee, a financial strategist, talk about Bitcoin here: https://www.cnbc.com/2017/09/15/bitcoin-could-surge-another-... He points out that there are only 300,000 Bitcoin wallets that hold $5,000 or more. In the grand scheme of things that is very small compared to the o…

Of course blockchain technology is here to stay, regardless of what happens, the same way tulips stayed with us after the mania had ended.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#105

Post by yxhuvud »

craigc wrote: post #14
newmanships wrote: post #11

Earlier quoted context omitted.

Small thing, but wasn't it JP Morgan's clients buying bitcoin through their brokerage service, not actually JP Morgan? https://twitter.com/ToneVays/status/909032026455642113

Ah, good point. Well there is still some irony in that!

Not really, but it may make them hypocrites, as they act as enablers for something they see as fraud.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#106

Post by jokoon »

It's true that libertarians are really fans of crypto-currencies.

To be honest, as long as you trust a government, banks can be trusted with your money, especially since the government regulate banks since the government doesn't regulate crypto-currencies (yet).

Libertarian when you profit from crypto-currencies, until somebody steal you bitcoin wallet or until bitcoin crashes again. Then you're pretty happy to still use an insured bank account.

I would not be surprised to see bitcoin being used to launder money. All you would have to do is to sell a pile of dirty cash online against bitcoins, and send those dollar bill by the mail. I'm sure somebody already thought about that and is doing it already.

To be honest I would not understand why bitcoin is so high right now, a logical explanation would be drug money.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#107

Post by uncle_bob »

EGreg wrote: post #68
craigc wrote: post #29

Earlier quoted context omitted.

That is a very good question. I didn’t do a good job making an argument for why I think the value of a currency like Bitcoin could be so much higher than an altcoin that did an ICO. In my opinion, Bitcoin has the first mover advantage in this space. It was the first real use of the blockchain, is still the gateway to pretty much every other crypto currency, there is a maximum supply of coins, and is one of the only c…

Question: Bitcoin is a global cryptocurrency. Sure it has a first-mover advantage but so does Google. Today someone searches with google, tomorrow they may switch to Bing. Can't the same be said of Bitcoin and say Litecoin / Dogecoin / whatever? So why is Bitcoin worth more than Litecoin let's say? Both are accepted by Coinbase etc.

Distribution of new coins that are "mined" are dependent on the price of electricity and popularity. Being first means it was the most popular by default, so it had the most diverse group of "miners", all of them. I could make CrapCoinV37 today, with only myself "mining" it, it would be a worthless expense of electricity if it wasn't popular. The price of Bitcoin stays reasonably in equilibrium with the cost of electricity required to "mine", which is substantial.

Most importantly, the Coin that has the highest expense to "mine" is the most secure. To attack Bitcoin by out pacing the current miners, it would require millions of dollars in hardware which could just as easily be used to legitimately acquire Bitcoin by mining.

However second place is easily attacked, as the case with BCH, the bitcoin attempted fork. Miners are using their hardware to primarily mine Bitcoin, paying for the hardware, then occasionally attacking BCH, to break it's adjustment algorithm.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#108

Post by marian0_ »

NelsonMinar wrote: post #84
jdormit wrote: post #4

> A group of Bay Area programmers this year used an I.C.O. to raise $35 million for their project, an anonymous web browser called Brave As in Brave, the new browser from Brendan Eich (founder of Mozilla, famously invented JavaScript in 10 days)? Hardly a scam... Either the reporter didn't do their research or twisted the facts to fit their story.

As in Brave, the company whose business model is siphoning ad revenue from publishers.

Not that there's anything wrong with that.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#109

Post by tim333 »

imaginenore wrote: post #98
aplummer wrote: post #95

Earlier quoted context omitted.

I agree with what you are saying to an extent (it is just paper), however at a minimum the value of government backed money could possibly be expressed by the mobilisation of resources a government would rally to give it value. Lets say everyone declares USD is worthless, the government could 1) sell things of value demanding explicitly USD in return. 2) Impede movement or other activities, use of public goods using…

You should look into Zimbabwean dollars, Russian ruble, Venezuelan bolivar history. No amount of government intervention will help to keep the value once the population loses faith in the currency. Even if you start giving away gold bars for each unit of currency, you will quickly end up with no gold bars and lots of worthless paper. If you restrict the supply of currency, people quickly invent their own money, which…

I think with Zim dollars and the like the problem is too much money chasing too few goods. Without that they would behave normally. I can't think of practical instances of restricting the currency supply leading to people inventing money getting far. Sometimes if the local currency is not taken abroad people will try using USD or similar instead but inventing some new money doesn't help much for that.
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