Bitcoin Surges Past $7,000 to Extend Record Rally • Hacker News Board

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#291

Post by IncRnd » Thu, Nov 02, 2017, 4:25 PM UTC

cloudhead wrote: post #276

mcv wrote: post #237

Earlier quoted context omitted.

> With Bitcoin you only have trust in value of Bitcoin. More specifically, you have trust in the continued trust that others have in it. It's a self-fulfilling prophesy: as long as people continue to trust it, it continues to be valuable, but as soon as people start to doubt that others will continue to trust it, it's instantly worthless. There's no real value backing it up. This makes it very vulnerable to hype and…

What currency doesn't operate this way?

Some currencies are pegged to other currencies or values.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#292

Post by mrb » Thu, Nov 02, 2017, 4:25 PM UTC

wbl wrote: post #190

mrb wrote: post #180

Earlier quoted context omitted.

" It's like a pyramid scheme in that so long as people keep buying in on the hope of a profit " You just described any investment. FX market, stock market, housing, etc. It doesn't make them "pyramid schemes".

I could buy a bitcoin and hope to sell it later. Or I could buy the S&P 500: a market cap weighted set of pieces of companies that will conduct business and grow by the time I have to sell them, and some will give dividends. Which seems better to you?

Bitcoin changes the world: a permissionless decentralized financial ledger reduces payment friction hence boosts trade, gives access to the unbanked/underbanked, helps people escape inflation, etc.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#293

Post by Scea91 » Thu, Nov 02, 2017, 4:27 PM UTC

wolco wrote: post #215

romanovcode wrote: post #32

Earlier quoted context omitted.

All people who are owning Bitcoin are betting.

In some ways we all are but I think we are forgetting the most important aspect. Using it for payments. That utility use case is more important because at some point the price will go down

That is the problem with deflation. People expect that their money will be worth more tomorrow so they are more reluctant to spend it.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#294

Post by Xixi » Thu, Nov 02, 2017, 4:27 PM UTC

LyndsySimon wrote: post #204

zanny wrote: post #171

Earlier quoted context omitted.

None of the cryptos that exist today can even function as an effective "buying stuff" currency because they are all deflationary, not just in exchange rates and short term speculation but in how they all mine at fixed / declining rates to finite limits. If its going to be worth more tomorrow, you probably don't want to trade it for something today. The use case for bitcoin is the same use case that makes up 95% of th…

First of all, not all existing cryptos are deflationary. Off the top of my head, Dogecoin is the best-known example of an inflationary crypto. There are about 110,000,000,000 Doge in circulation at the moment, and that number will increase at a rate of a little over 5,000,000,000 per year ad infinitum. Secondly, the inherent deflationary nature of Bitcoin has not yet come to pass. Coins are currently being mined at a…

Capital being held in "state-controlled inflationary currency" would be unusual. Capital would usually be composed of real-estate, stocks, ETFs, bonds, gold, commodities, maybe an art collection. Arguably US treasury bonds are not that different from holding actual USD, I concede that. But a share of Apple is a share of Apple. It doesn't matter if you quote it in USD, EUR, BTC or gold nuggets: its intrinsic value is the same.

In fact the richest people I know are all negative USD, and very positive everything else (especially real-estate), because they borrow USD to invest. The poorest are also negative USD, and holding only liabilities with little assets. It's only the ones in the middle that are positive USD. Basically not rich enough to buy real-estate (or not interested), but certainly not poor either.

May I ask you a question: would you borrow Bitcoins to, say, buy a plot of land in the middle of Arizona, plant vines and start making wine? This is why as far as I am concerned I don't see Bitcoins as any sort of competition to USD, EUR, JPY, etc. It's just yet another asset that may or may not prove to be a good investment in the long run. I hold some, just in case.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#295

Post by loki0505 » Thu, Nov 02, 2017, 4:28 PM UTC

aakilfernandes wrote: post #265

loki0505 wrote: post #246

I believe once you can start using your cryptocurrency as collateral for a loan, this space is going to go into the trillion(s). check out Salt Lending. I know many waiting for it to open so they can get a 100k loan and put it back into crypto. This project has been fully licensed and regulated, and owned by the founder of shapeshift (erik vorhees)

Any idea on the tax implications of this? Do you have to pay cap gains when using crypto as collateral? If not, seems like it'd be massively useful for whales to cash out without paying taxes.

honestly, this seems like a grey area and I have no idea! but the concept of this platform is amazing, and has already been approved. They are taking SALT deposits currently (just opened a few days ago) so they are ramping up for full operation soon. I would suggest to hit up their reddit...i'm gonna do the same :-)

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#296

Post by IncRnd » Thu, Nov 02, 2017, 4:28 PM UTC

dumbfounder wrote: post #269

onion2k wrote: post #219

Earlier quoted context omitted.

Bitcoin's value is given by the trust people put in it. Currency speculators don't give a damn about trust. They're not in it for the long term value that derives from the usefulness of Bitcoin, and that's the only thing you need trust for. They'll cash out when the price gets to a point where they're happy with their return. At that point either new speculators will get on board and keep the price high or the price…

They increase the volatility which decreases its value as a currency. If prices are volatile it makes it hard to price items tied to Bitcoin.

Even if Bitcoin's price were stable, it would still be difficult to tie items to Bitcoin when it takes at least an hour per transaction.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#297

Post by mrb » Thu, Nov 02, 2017, 4:29 PM UTC

nikolay wrote: post #277

nikcub wrote: post #155

Earlier quoted context omitted.

> boasting much faster and cheaper transactions and real anonymity Cost me over $4 to send Monero transactions last month. Cost me about $3 to send a Bitcoin transaction this morning. The average and median transaction fees between the two networks have been pretty close for a while I like Monero but it has some way to go - it needs a light client, multisig completed, and hasn't really had to confront any scaling iss…

I see hundreds of my friends sending money free with Venmo each month. I know nobody having any slightest interest in Bitcoin or the likes. Once in a while, somebody would ask me if it makes sense for them to invest some cash into Bitcoin as they've heard about some crazy growth, but when I explain to them some, they all decide it's too risky, and those who are the anarchist type stick to gold.

Given that it's risky, you could (should) have told them to just invest a tiny amount, like 1% of their savings. That's what I told some folks, and now their investment is up 10× so their 1% investment turned into 10% and their are really happy about it.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#298

Post by bitmapbrother » Thu, Nov 02, 2017, 4:29 PM UTC

I recall being downvoted when I replied to someone asking if it was too late to invest in Bitcoin when it was at $4000. In my reply I quoted Roger Ver by saying that it was never too late to invest in Bitcoin. I also decided to walk the talk and buy some at $4000 with money I could afford to lose. Glad I did.

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#299

Post by IncRnd » Thu, Nov 02, 2017, 4:31 PM UTC

swalsh wrote: post #254

joefourier wrote: post #31

Notice how almost all news of Bitcoin now are about its price. Bitcoin used to be exciting in both technical and economical aspects, but has now become just a store of value entirely driven by speculation. Other technically superior cryptocurrencies (e.g. Monero, Ethereum) have replaced most of its usecases, boasting much faster and cheaper transactions and real anonymity in the case of Monero. Bitcoin takes more tha…

I keep thinking about investing again, but I have a rule about investments. If I can't come up with a reasonable story to explain why supply and demand are the way they are. I don't invest. I can explain the supply side part... but the demand here baffles me. The best explanation I can come up with is "this thing is rising in price like a rocket, maybe I'll make some money" That's not a good reason to invest in my op…

The demand is that there are many people such as yourself who wonder if they should invest due to rising prices. It's speculative demand. :)

Re: Bitcoin Surges Past $7,000 to Extend Record Rally

#300

Post by seanmcdirmid » Thu, Nov 02, 2017, 4:32 PM UTC

kgwgk wrote: post #250

seanmcdirmid wrote: post #81

Earlier quoted context omitted.

Are you investing your savings? No. Are you just holding it in a bank with little or no interest, then yes.

Even holding it in a bank for low interest is investing. Using it as a store of value would be keeping it in your wallet or in a safe (as you would do with gold, for example).

Not really....not at these rates anyways. There isn’t much difference between putting your money in the bank or under your mattress, well, except for convenience and safety issues.