Is There a Cryptocurrency Bubble? Just Ask Doge • Hacker News Board

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#141

Post by aboodman » Sun, Sep 17, 2017, 4:31 PM UTC

subroutine wrote: post #94

aboodman wrote: post #37

Earlier quoted context omitted.

The utility is a way to send value ~instantly, ~anonymously, relatively inexpensively, and irrevocably from one side of Earth to the other, without any intermediaries. That hasn't existed before.

It's interesting to think that the value of cryptocurrency as both the value derived from the platform's utility and the value ascribed to the coins based on consumer demand. Because these are both embedded into the coin valuation it feels more like stock to me than currency. Specifically it might be like owning stock in eTrade, which has utility value as a platform for trading stock, and an arbitrary value based on…

All currencies have that trait. USD has a value that is famously propped up because of its ubiquitous utility. Everyone wants/needs dollars (to trade w/ US, to pay US taxes, to use as a reserve currency, etc). This demand increases the cost of dollars relative to everything else.

The only reason it is harder to notice with crypto is because the size of the market you can use crypto in is so ridiculously small (relative to a national currency) that investment value and speculative effects dominate.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#142

Post by geezerjay » Sun, Sep 17, 2017, 4:55 PM UTC

koonsolo wrote: post #83

danmaz74 wrote: post #78

Earlier quoted context omitted.

> Jackson Palmer might not believe it has value, but clearly, there are people who own Doge that think otherwise If there is one way you really can't detect a bubble, it's relying on "people thinking X has value". Also people buying tulip bulbs for a house worth thought those bulbs had value, as in every other bubble in history.

> 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,…

> What do you think happens to fiat money when people stop believing it has value?

That's precisely the source of your misconception regarding the intrinsic value of fiat currency.

Fiat currency always has value as they are the basic unit used by the state to determine how much taxes you owe them, which is linked to a percentage of everyone's gross income.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#143

Post by sctb » Sun, Sep 17, 2017, 5:06 PM UTC

seibelj wrote: post #54

Yes, please spread more FUD about cryptocurriencies. Work for 10 years until you can make the connections to beg for enough money to found your startup. Global capital raising on the blockchain is bad. Only the rich should get richer. Hate on radical ideas getting funded. You are smart. They are dumb. Success can be yours if only you play the game...

Could you please post civilly and substantively or not at all?

https://news.ycombinator.com/newsguidelines.html

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#144

Post by dogruck » Sun, Sep 17, 2017, 5:07 PM UTC

qznc wrote: post #75

dogruck wrote: post #71

Earlier quoted context omitted.

"It has worked ok so far. Therefore there's no problem."

You want to suggest that they would not pay out if Bitcoin crashes to zero? Maybe. They are not regulated after all. They might also be bankrupt before Bitcoin hits zero. Still, you can short these 30% drops without problem. Did shorting the housing market work out well in the crash? I remember a movie with Christian Bale, where it did.

Yes, some people successfully shorted the housing market. But they did not use bearer instruments to take their positions.

https://en.m.wikipedia.org/wiki/Bearer_instrument

Also, counter party risk was a major issue during that financial crisis.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#145

Post by CryptoPunk » Sun, Sep 17, 2017, 5:50 PM UTC

craigc wrote: post #29

subroutine wrote: post #23

Earlier quoted context omitted.

Noob question... What is the "product" that underlies the value of cryptocurrency that is so much more valuable than what underlies an ICO? What is the value of a machine churning hashes? It seems like the value is underlied by securing a transaction ledger + an arbitrarily difficult math problem. So is the value the security of the ledger?

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…

>>In order to purchase an altcoin such as BAT (the token behind the brave browser the article refers to), you have to first purchase Bitcoin. If you want to sell your BAT tokens, you will receive Bitcoin.

BAT is an ERC20 token on Ethereum. In order to purchase it you buy Ether, and then go to a decentralized Ethereum exchange like 0x and purchase it. When you sell BAT, you receive Ether.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#146

Post by CryptoPunk » Sun, Sep 17, 2017, 5:52 PM UTC

subroutine wrote: post #34

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…

That's interesting. I have so many follow-up questions but I gotta head out to dinner. Time for just one... if you're saying ICO company coins are worth sand - and the value of Etherium is as a platform for ICO companies. That seems like the definition of a bubble. No?

While the value of the average token may decline as a result of investors sobering up, I suspect the number of token sales will increase exponentially, at a rate that exceeds the per token decline in value, resulting in a net increase in the aggregate value of the token market, and with it, Ethereum.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#147

Post by craigc » Sun, Sep 17, 2017, 5:57 PM UTC

CryptoPunk wrote: post #145

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…

>>In order to purchase an altcoin such as BAT (the token behind the brave browser the article refers to), you have to first purchase Bitcoin. If you want to sell your BAT tokens, you will receive Bitcoin. BAT is an ERC20 token on Ethereum. In order to purchase it you buy Ether, and then go to a decentralized Ethereum exchange like 0x and purchase it. When you sell BAT, you receive Ether.

Yeah BAT was not the best example. I was just trying to illustrate that ANY altcoin can be purchased using BTC. Only some can be purchased with ETH

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#148

Post by CryptoPunk » Sun, Sep 17, 2017, 6:00 PM UTC

craigc wrote: post #147

CryptoPunk wrote: post #145

Earlier quoted context omitted.

>>In order to purchase an altcoin such as BAT (the token behind the brave browser the article refers to), you have to first purchase Bitcoin. If you want to sell your BAT tokens, you will receive Bitcoin. BAT is an ERC20 token on Ethereum. In order to purchase it you buy Ether, and then go to a decentralized Ethereum exchange like 0x and purchase it. When you sell BAT, you receive Ether.

Yeah BAT was not the best example. I was just trying to illustrate that ANY altcoin can be purchased using BTC. Only some can be purchased with ETH

My point is that a token is not an altcoin, as it does not have its own independent blockchain. Almost all tokens are issued on Ethereum, and thus almost all can be purchased without any centralized intermediary using Ether. It's much easier to get into/out-of tokens using ETH than using BTC.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#149

Post by craigc » Sun, Sep 17, 2017, 6:08 PM UTC

CryptoPunk wrote: post #148

craigc wrote: post #147

Earlier quoted context omitted.

Yeah BAT was not the best example. I was just trying to illustrate that ANY altcoin can be purchased using BTC. Only some can be purchased with ETH

My point is that a token is not an altcoin, as it does not have its own independent blockchain. Almost all tokens are issued on Ethereum, and thus almost all can be purchased without any centralized intermediary using Ether. It's much easier to get into/out-of tokens using ETH than using BTC.

Okay I think we are actually arguing the same thing though. The original argument was why I thought currencies/platforms like BTC and ETH should be considered more valuable than random altcoins (independent of if they are ERC-20 or not).

I am not trying trying to argue about if BTC or ETH is better.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#150

Post by CryptoPunk » Sun, Sep 17, 2017, 7:04 PM UTC

craigc wrote: post #149

CryptoPunk wrote: post #148

Earlier quoted context omitted.

My point is that a token is not an altcoin, as it does not have its own independent blockchain. Almost all tokens are issued on Ethereum, and thus almost all can be purchased without any centralized intermediary using Ether. It's much easier to get into/out-of tokens using ETH than using BTC.

Okay I think we are actually arguing the same thing though. The original argument was why I thought currencies/platforms like BTC and ETH should be considered more valuable than random altcoins (independent of if they are ERC-20 or not). I am not trying trying to argue about if BTC or ETH is better.

Oh okay, gotcha. Yeah I agree. Major currencies like ETH and BTC act as liquidity bridges for smaller cap digital assets. Tokens, which are digital assets issued on preexisting platforms, use ETH as their conduit, and altcoins, which are digital assets with their own native platform, mostly use BTC, and less commonly ETH, as theirs.