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Bitcoin Surges Past $7,000 to Extend Record Rally

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

#381

Post by SilasX »

ForHackernews wrote: post #15
vazamb wrote: post #8

Earlier quoted context omitted.

(i am somewhat familiar with the tech but don't follow the business side of bitcoin) what I find weird is the forks. A major selling point of bitcoin is that there will ever be only 21 Mio coins. You know, unless there is a hard fork and now there are suddenly twice as many coins. Presumably one of the resulting coins' value will drop but you are still creating value out of thin air, something that the crypto people…

> I am sure blockchain tech will be hugely successful in the banking and government sector Are you? Why? So far, no bitcoin/blockchain advocates have been able to explain to me a single non-illegal use case that isn't better served by a traditional, centralized database. A single large Postgres instance could handle all the global transaction volume of bitcoin, and it would be faster and orders of magnitude more ener…

I'm more interested in your dismissal of the fact that it can be used to do illegal activity. Do you plan to go the rest of your life without ever breaking a law? And as a sibling poster noted, there can be financial chokeholds even on activities that they didn't bother to make illegal, like donating to Wikileaks.

(I don't think you responded to the point that Wikileaks is a non-illegal use case for BTC.)

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

#382

Post by jstanley »

pawelwentpawel wrote: post #72
jstanley wrote: post #60

Earlier quoted context omitted.

> Like a hyped startup, it doesn't do much yet It does plenty already. I live almost exclusively on Bitcoin. I only get income in Bitcoin, I pay with Bitcoin whenever possible, and I have a Bitcoin-funded debit card for when that's not possible.

Does the company that you work for receive their income in Bitcoin too?

I work for myself. My customers pay in Bitcoin.

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

#383

Post by mywittyname »

SippinLean wrote: post #355
mywittyname wrote: post #349

Earlier quoted context omitted.

Well, there are two components to a pyramid scheme: 1. returns to early investors are generated by contributions from new investors. 2. Each new investor attempts to recruit two or more new investors. The "profits" for existing investors are paid with money from new investors. So it checks the first requirement to be a pyramid scheme. Now, this isn't explicit , but people still understand that the more BTC investors,…

There are many more components to a pyramid scheme, you've purposefully left out the ones that clearly don't apply to bitcoin and gone with a definition that is too broad to fit. Further, your first component leaves out the necessity of a purposefully fraudulent bad actor to redistribute the new investors' "investments" to old investors, instead of investing them. This is clearly impossible with a distributed ledger.…

Actually, I looked up the literal definition of a pyramid scheme before posting, to ensure I hit all the points.

> Returns (and losses) to all investors, new or old, are equally distributed.

No, old investors can profit while new investors lose money. Or, the new investors paid the old ones. Original BTC investors got them for free, the next generation paid pennies for them, the next paid dollars, then hundreds, and the current generation is paying thousands each.

So should the price collapse, the old generation still stands to make massive profits, at the expense of current investors.

> Simply saying "hey, this could be a good investment" doesn't make something a pyramid scheme, unless Apple is a pyramid because my financial advisor told me and one more client to buy shares of it.

Apple earns a profit, of which a share is provided to owners. That's why it's a good investment.

BTC is a purely speculative investment and literally the only way to earn a profit is to get someone else to buy it for more than you paid. It will never pay you a dividend, it will never generate any revenue.

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

#384

Post by mywittyname »

nikolay wrote: post #368
mywittyname wrote: post #341

Earlier quoted context omitted.

The solution to this is, and always has been, to buy equities. Put your wealth to work generating an income stream.

A guy living in a basement in China, Ukraine, or Russia is not sophisticated enough to make such investments. Bitcoin is the amateur investment dream, but, unfortunately, there is unscrupulous money behind it, too. When there's a supply of avid supporters living in denial and who invest any penny in it at any price, there's an opportunity to make money out of somebody else's stupidity.

People in those countries have access to equities markets. It's a little more awkward to trade in Russia, but there absolutely are online brokerages that service the country. China actively encourages private citizens to invest in stock funds.

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

#385

Post by SippinLean »

mywittyname wrote: post #383
SippinLean wrote: post #355

Earlier quoted context omitted.

There are many more components to a pyramid scheme, you've purposefully left out the ones that clearly don't apply to bitcoin and gone with a definition that is too broad to fit. Further, your first component leaves out the necessity of a purposefully fraudulent bad actor to redistribute the new investors' "investments" to old investors, instead of investing them. This is clearly impossible with a distributed ledger.…

Actually, I looked up the literal definition of a pyramid scheme before posting, to ensure I hit all the points. > Returns (and losses) to all investors, new or old, are equally distributed. No, old investors can profit while new investors lose money. Or, the new investors paid the old ones. Original BTC investors got them for free, the next generation paid pennies for them, the next paid dollars, then hundreds, and…

Why were you throwing the term around before you knew what it was? Again, you left out MANY aspects of pyramid schemes--the ones hardest to twist into fitting bitcoin.

And you glossed right over this: the necessity of a purposefully fraudulent bad actor to redistribute the new investors' "investments" to old investors.

>So should the price collapse, the old generation still stands to make massive profits, at the expense of current investors.

Nope, the old generation suffers the same losses as the new if the price crashes. A pyramid scheme is just that, a scheme with a central organization controlling the flow of income. That is impossible with a distributed ledger.

The last part of your answer is a rant about Apple vs Bitcoin, I think you missed my only point: in a pyramid scheme new members are promised a share of the money taken from every additional member that they recruit. "Evangelizing" by itself is not proof of a pyramid scheme.

I suggest you continue to look it up and learn what a pyramid scheme is. It's different than speculation, it is different than a Ponzi scheme.

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

#386

Post by mywittyname »

kgwgk wrote: post #369
mywittyname wrote: post #354

Earlier quoted context omitted.

Sure it does. The USD has surged in value in the past few years. It's gone up like 20% against most other major world currencies in the past five years.

4% p.a. doesn’t look like climbing to me...

Well, it is in the up direction, at least.

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

#387

Post by coryfklein »

mywittyname wrote: post #349
SippinLean wrote: post #280

Earlier quoted context omitted.

What you said still falls quite short of a literal pyramid scheme, which has a pretty specific definition. There is no central organization to recruit new members. People that buy bitcoin receive a real, usable product. Every person holding bitcoin profits when the price goes up. This is all in stark contrast to a true pyramid. The way specific ICOs are structured, I could see an argument for some kind of pyramid; bu…

Well, there are two components to a pyramid scheme: 1. returns to early investors are generated by contributions from new investors. 2. Each new investor attempts to recruit two or more new investors. The "profits" for existing investors are paid with money from new investors. So it checks the first requirement to be a pyramid scheme. Now, this isn't explicit , but people still understand that the more BTC investors,…

Point 1 applies to Apple stock as well

Point 2 has nothing to do with Bitcoin. Yes, there are bitcoin holders that evangelize the currency, but there are plenty that don't.

You are not analogizing correctly - just because you can find a similarity or two between two things doesn't mean one is a metaphor for the other. See Hume's response to the Watchmaker Analogy[1] for more.

[1] https://en.wikipedia.org/wiki/Watchmaker_analogy#David_Hume

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

#388

Post by coryfklein »

SippinLean wrote: post #355
mywittyname wrote: post #349

Earlier quoted context omitted.

Well, there are two components to a pyramid scheme: 1. returns to early investors are generated by contributions from new investors. 2. Each new investor attempts to recruit two or more new investors. The "profits" for existing investors are paid with money from new investors. So it checks the first requirement to be a pyramid scheme. Now, this isn't explicit , but people still understand that the more BTC investors,…

There are many more components to a pyramid scheme, you've purposefully left out the ones that clearly don't apply to bitcoin and gone with a definition that is too broad to fit. Further, your first component leaves out the necessity of a purposefully fraudulent bad actor to redistribute the new investors' "investments" to old investors, instead of investing them. This is clearly impossible with a distributed ledger.…

> literally the only way to earn a profit is to get someone else to buy it for more than you paid.

Don't you mean figuratively? An individual who bought $10 of bitcoin a year ago would have made a profit without bringing anybody else to Bitcoin. In a pyramid scheme, the ONLY way to make money is to bring others in.

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

#389

Post by coryfklein »

aw3c2 wrote: post #283
buchanaf wrote: post #121

Earlier quoted context omitted.

A pyramid scheme involves some form of active (fraudulent) recruitment to help increase the price of the asset. Bitcoin doesn't have this. From what you described above, every single speculative/overinflated asset would be a pyramid scheme. That's not the case.

> A pyramid scheme involves some form of active (fraudulent) recruitment to help increase the price of the asset. Bitcoin doesn't have this. Haha, have you ever looked at what Bitcoin owners/speculaters post online?

More specifically, a pyramid scheme requires that you recruit others to make money. If you bought $10 of bitcoin 5 years ago and never told another soul or recruited another person, then you'd make a profit. The same cannot be said for a pyramid scheme.

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

#390

Post by coryfklein »

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?

Historically speaking, if you bought bitcoin at any point and time and held on to it for 2 years it would outperform an S&P 500 index. We can argue about how long that trend would continue, but those who have chosen to invest at least something in bitcoin have made a good investment so far.

Yes, it is a high risk investment, and yes you could lose 99% of your investment. If you don't have a tolerance for that kind of risk, then bitcoin shouldn't make up much (if any) of your portfolio.

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