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It can all go to zero

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Re: It can all go to zero

#21

Post by JumpCrisscross »

adamnemecek wrote: post #10
JumpCrisscross wrote: post #5

Earlier quoted context omitted.

> At this point there's waayy too many actors and people who want Bitcoin to succeed This has no relation to whether something goes to zero (or practically zero). Political influence? Sure. But I don't think anyone expects D.C. to bail out Bitcoin. > A company has a "single point of failure" Companies trade after bankruptcy. There are stubs, practical and theoretical, for companies improperly wound up going back deca…

> But I don't think anyone expects D.C. to bail out Bitcoin. What does it mean for Bitcoin to be bailed out? How can Bitcoin "fail"? > But a penny price is as good as zero. Why would it go to zero?

> What does it mean for Bitcoin to be bailed out?

Around when Bitcoin was trading at $19,000, my Uber driver told me about the second line he'd taken on his home to buy some. That's not a systemic problem in America. But it might be in some other countries, e.g. South Korea.

Suppose Bitcoin crashed 90% and stayed down for a few months. It is conceivable that Seoul might pay out, to avoid social tension. Directly, e.g. you get a jeon for every won you lost, or indirectly, e.g. temporarily increasing welfare benefits [1].

Note that I said "conceivable." It is unlikely, hence why I think arguing that because lots of people are involved it cannot become worthless is silly.

> Why would it go to zero?

Why would it go to $50,000? Because people decide it's worthless (or worth more).

[1] https://www.theguardian.com/business/2014/sep/03/long-term-u...

Re: It can all go to zero

#24

Post by SurrealSoul »

Every year for the last four years, bitcoin went down -20%~ or so in the 3rd week of Jan. I don't know why everyone freaks out this week

Honestly, the history and trends are there, its just a thing that happens every year, I dunno man

Re: It can all go to zero

#25

Post by fortythirteen »

At this point, Bitcoin is not much more than a phantom object. Too overpriced to use for any reasonable purchase, people are literally trading nothing but zeros and ones, no more or less valuable than the bits making up this comment.

All that can change, but only if the price drops back down to its 2016 to early 2017 values, and there are too many people invested at this price to let Bitcoin survive as an actual currency if that happens.

We crossed the event horizon a couple months ago.

Re: It can all go to zero

#26

Post by stcredzero »

nxsynonym wrote: post #8
JumpCrisscross wrote: post #5

Earlier quoted context omitted.

> At this point there's waayy too many actors and people who want Bitcoin to succeed This has no relation to whether something goes to zero (or practically zero). Political influence? Sure. But I don't think anyone expects D.C. to bail out Bitcoin. > A company has a "single point of failure" Companies trade after bankruptcy. There are stubs, practical and theoretical, for companies improperly wound up going back deca…

Agree. Too big to fail is a terrible, copy-pasta argument that makes no sense. The combined worth of all the crypto-currencies put together is a drop in the global-financial bucket. The only people who would be hurt by a collapse to zero are those trying to artificially pump the price to cash out rich. I used to be anti-FUD, but whatever the term for the opposite is - it's way more infuriating.

The opposite of FUD is hype. Or maybe, a specific form of hype?

Re: It can all go to zero

#27

Post by ohitsdom »

cableshaft wrote: post #18
aphextron wrote: post #7

Earlier quoted context omitted.

Ask yourself what exactly is behind that “~550B”. The answer is nothing but faith. You are comparing the market cap of cryptocurrencies to NASDAQ, a portfolio of the highest profit driving, real asset laden companies on earth. How is this even remotely realistic?

Everything is based on faith to a certain extent. None of us (that I'm aware of) have crystal balls that see the exact future. Even companies that have lots of assets behind them could potentially make catastrophic fuck ups that tank their stock (i.e. BP and their Deepwater Horizon spill) in an instant.

I think you see the point the parent comment was making. Even if BP makes a colossal mistake and their stock dives, at the very least they can sell of their real physical assets. Crypto can actually dive to zero, there is no safety net since there are no physical goods.

Re: It can all go to zero

#28

Post by JumpCrisscross »

adamnemecek wrote: post #20
baq wrote: post #15

Earlier quoted context omitted.

> Why would it go to zero? Crisis of faith. There's nothing else behind it.

The thing tho is that people have seen the insane gains it can provide. There will always be buyers. If Bitcoin went to $50 tomorrow, you can bet I would buy a lot. I'm not the only one. It's done magic once, it might again. The point is, there will always be buyers.

> The point is, there will always be buyers

Someone could have said the same for the Dutch East India Trading Company. "What, will the colonies sink into the ocean?"

Note: I'm not saying it will become worthless. But you're grossly underestimating this risk.

Re: It can all go to zero

#29

Post by stcredzero »

api wrote: post #11
adamnemecek wrote: post #3

The comparison with the other company makes no sense. A company has a "single point of failure". At this point there's waayy too many actors and people who want Bitcoin to succeed. The market is huge at this point. Like NASDAQ is like 7T IIRC. Crypto is today ~550B. It was like ~750B not too long ago. Note how there's no glue joining the idea of the company and crypto. It could go down but it could also go really up…

People made a version of that argument with mortgages and mortgage backed securities. Mortgages are spread across too many people, too many geographic areas, etc., and there's no way they'll all decline or default at once.

and there's no way they'll all decline or default at once.

This is where Credit Default Swaps came in. What is the cryptocurrency equivalent of a Credit Default Swap?

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