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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

#121

Post by koonsolo »

MustrumRidcully wrote: post #115

The problem of bitcoin is that there is a finite amount of it that will be available. As use of bitcoin is scheduled to grow, the pace of the production of bitcoins needed to support the market does not keep up. This results in a steady increase of the value of bitcoin, which is good for adoption (more people will buy it to speculate and sellers will accept it), but endangers it as a mean of paiement as buyers are al…

> The reason bitcoin will not be used for daily exchanges is the same as we do not use gold anymore.

Everybody has a cellphone. You pay and receive "money" with your cellphone. Wallets will be redundant in the future, everything that is in your wallet will be stored in your phone.

And you know which currency can be paid with your phone? Exactly!

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#122

Post by CamelCaseName »

runeks wrote: post #111
aml183 wrote: post #66

Earlier quoted context omitted.

I guess sell it. People think it's valuable. Cryptocurrencies are priced not valued. You can't just go Dogecoin is valued at X. Dogecoin is priced based on supply and demand which is saying it's worth $91MM.

All Dogecoins in circulation are not worth $91m. For that to be the case, there’d have to be people willing to buy all 111 million Dogecoins for $0.000796 each, which is not the case at all. People are only willing to pay this price for a tiny fraction of all Dogecoins in existence; as we go beyond that, the bid price starts approaching zero.

The opposite is also true, and not just in assets like stocks but cryptos as well.

The price of any asset increases substantially if you try to buy a significant stake.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#123

Post by someonewhocar3s »

subroutine wrote: post #112
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,…

Why would you trust a novel currency over the collective interests that stand behind the USD or Euro? Currencies backed by powerful democratic governments, huge corporations, advanced military industrial complex, research, educational, and financial institutions, and basically all the people that live in those countries aside from a miniscule fraction that prefer cryptocurrency, a currency that must be converted into…

Look at the Rabobank skyscraper in the center of Utrecht, The Netherlands.

Bitcoin was made by people that fit in just one room, office and all. It's ecosystem probably spans a floor or a few.

And all those people involved, the vast size of the machine, these are weaknesses. Vulnerabilities. Do I want to fail with democracies? With government-subsidized military industry? With multinationals?

Why would I want a financial institution, when I can directly create a financial product (as a DAO)?

Why would I hold my money in a bank where the government can take it to bail out huge companies?

CryptoCurrencies far exceed the financial sector's ability to produce and offer, reliably, financial products. And it feels like being liberated from a system so big and unwieldy nobody seems to understand or control it. If you want a sanity check: see how many bankers were >responsibleYou're free to hand your value to the man. Or to keep your own administration. And now with bitcoin technology, it's easy for everyone to do collective yet independent accounting.

(regardless - stable currency is not a solved issue, even in cryptoworld. You might assume it's solved IRL but it's not at all, it's better than 100 years ago, but seems to be a real struggle.)

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#124

Post by CamelCaseName »

Method-X wrote: post #40
sl4i6j3o4i98g wrote: post #20

Earlier quoted context omitted.

The scam was not so much with Brave, but how the BAT token was distributed. There were 184 investors in the BAT ICO -- is this a fair distribution for what is proposed to be the new attention economy? The scam is in the back end of how ICO's are run. Even if the project is legit, doesn't mean the token distribution was legit. $35m in 30 seconds?? More details: https://medium.com/the-bitcoin-podcast-blog/a-look-at-the…

How is that any different from issuing shares privately to VCs? It seems to me the only fundamental difference is with the technology. Things like voting and vesting can be done on a blockchain, so that's not a limitation. There isn't any rule that says a blockchains token distribution has to be "fair". Granted, a more "even" initial distribution makes sense for a currency, but it you're treating crypto tokens as sha…

The difference is in how much value must be added before VCs can sell their holdings onto the public.

Many ICOs give deep discounts to "partners" who may not have even spent anything, but are just used as an endorsement and social proof. Within days those partners will be dumping on others.

I suppose by definition VCs look very similar to ICO "partners", but the latter's due diligence will rest entirely on finding the greater fool, whereas the VC will seek to establish whether the team can actually deliver, product fit, etc.

Thats said, I'm sure there are a handful of exceptions to both VCs and ICO partners.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#125

Post by MustrumRidcully »

koonsolo wrote: post #121
MustrumRidcully wrote: post #115

The problem of bitcoin is that there is a finite amount of it that will be available. As use of bitcoin is scheduled to grow, the pace of the production of bitcoins needed to support the market does not keep up. This results in a steady increase of the value of bitcoin, which is good for adoption (more people will buy it to speculate and sellers will accept it), but endangers it as a mean of paiement as buyers are al…

> The reason bitcoin will not be used for daily exchanges is the same as we do not use gold anymore. Everybody has a cellphone. You pay and receive "money" with your cellphone. Wallets will be redundant in the future, everything that is in your wallet will be stored in your phone. And you know which currency can be paid with your phone? Exactly!

Well you could do the same with paper-gold. But since its value increases over time you have no incentive to prefer it over $, which have a decreasing value. Stop focusing on tech and try to think about underlying market forces.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#126

Post by notahacker »

koonsolo wrote: post #119
subroutine wrote: post #112

Earlier quoted context omitted.

Why would you trust a novel currency over the collective interests that stand behind the USD or Euro? Currencies backed by powerful democratic governments, huge corporations, advanced military industrial complex, research, educational, and financial institutions, and basically all the people that live in those countries aside from a miniscule fraction that prefer cryptocurrency, a currency that must be converted into…

I consider Bitcoin more of a "collective interest" than money produced by governments. History is full hyperinflation horror stories. Do you trust professional encyclopedia writers more than a bunch of anonymous volunteers collectively writing articles? But Wikipedia is a fact no? It works. Distributed things seem to work, in practice. I agree that Bitcoin still has to prove itself. But if such a thing as Wikipedia c…

You can get the equivalent crash in currency value from people choosing to exit their BTC en masse without emitting new coins. Ultimately hyperinflation is a massive imbalance of supply and demand, and whilst the supply side is much more fixed with BTC than a floating, fractional reserve currency, the demand side is much less fixed because there really aren't that many future obligations to pay things in BTC.

And I was under the (possibly incorrect?) impression that with the support of enough of the hashing power, core Bitcoin could hypothetically be forked in a way which massively increased the rate at which new BTC were emitted. (Something which would be highly unlikely as miners have strong incentives not to do this under normal circumstances, but the same applies to governments having no incentives to rapidly debase their currency under normal circumstances)

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#127

Post by lloyd-christmas »

topmonk wrote: post #96
InclinedPlane wrote: post #59

Is there a cryptocurrency bubble? Of. Fucking. Course. Only those who are extremely naive or cryptocurrency zealots could possibly believe otherwise. Now, here's the core problem preventing people from understanding the reality of the bubble: in almost all bubbles there is still a kernel of honest, real value inside the bubble. That's the impetus for the bubble, but it doesn't prevent the bubble from being a bubble.…

I don't think it is a bubble. Everyone seems to equate real estate, stocks, and currency as all the same thing. Unlike the first two, currency increases in intrinsic value the more people believe it has value. So saying that how can bitcoin increase 1000x and still not be overvalued, you have to understand that now (people x perceived value) has had to increase 1000x as well. This means the currency is now accepted 1…

This is only true if the people buying it actually think of it and use it as a currency. I own some bitcoin and ether and have never used them as a currency. If its usage is not primarily as a currency, it isn't a currency. I struggle to believe there is more value on a daily basis in transactions of btc for goods and services than there is for "forex".

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#128

Post by koonsolo »

MustrumRidcully wrote: post #125
koonsolo wrote: post #121

Earlier quoted context omitted.

> The reason bitcoin will not be used for daily exchanges is the same as we do not use gold anymore. Everybody has a cellphone. You pay and receive "money" with your cellphone. Wallets will be redundant in the future, everything that is in your wallet will be stored in your phone. And you know which currency can be paid with your phone? Exactly!

Well you could do the same with paper-gold. But since its value increases over time you have no incentive to prefer it over $, which have a decreasing value. Stop focusing on tech and try to think about underlying market forces.

I don't know about you, but I prefer to store the value that I work for, in something that doesn't burn 2% off each year.

And if I have to buy something, I will just trade in my value stored with the thing I want to buy. I don't see any need to go to an intermediate thing that keeps decreasing in value.

Paper money was preferred over gold because it was inconvenient to keep working with gold, not because the paper loses its value.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#129

Post by Aunche »

jacobush wrote: post #116
Aunche wrote: post #97

Earlier quoted context omitted.

The key words are "by regulation or law." Bitcoins are completely unregulated right now. Coinbase can do whatever they want with people's crytocurrency and the government won't bat an eye, which is basically what happened with Mt Gox. At least your bank account is FDIC insured.

Isn't Bitcoin considered a liquid asset by most jurisdictions? So even though it's not money, you can't do just anything without culpability whatsoever.

Ok. Anything is an exaggeration, but they can definitely get away with insider trading or market manipulation. For example, litecoin rose suspiciously right before Coinbase announced they were letting people buy litecoin.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#130

Post by dagaci »

zby wrote: post #90
dagaci wrote: post #89

Some have posted and argued that these currencies do not have "real" value. I would argue that CrytoCurrencies do actually have inherent value. A few reasons: 1# CrytoCurrencies are free from the existing monopolies of the banking sector, money exchangers and politics. You can argue that those hegemonies should have control, but it is undeniable that there is tremendous value to many in that control weakening and bei…

These are features that are useful only after you accept that the coins have some value. If they don't store any value - then there is no use in security, privacy etc. But the point is that it is the same with all money - people don't want it for itself - but rather because they expect to exchange it for something that they'll want in the future.

If your paper money does not store value directly. Which means you can't eat it or directly build anything useful with it. And your checking account is simply a digital representation of that paper then i would argue that a purely digital currency is simply an evolution of that and not actually massively different from paper. The difference being the removal of the requirement of centralized control.
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