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Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

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Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#51

Post by tenaciousDaniel »

jgh wrote: post #44
ordinaryradical wrote: post #9

This utopian streak running through the crypto community is what convinces me most that it’s going to be a heartbreaker. > But Hayek used the notion of distributed knowledge. Well, it looks like we do not even need that thing called knowledge for things to work well. Nor do we need individual rationality. All we need is structure. Irrational exuberance is a good thing! And while these ideologues are busy demonizing t…

I honestly hope the utopian dream is smashed in the cryptocurrency community. It's not the kind of "utopia" I want to be a part of. I like the technical ideas behind cryptocurrency, but the terrible political views are off-putting.

I'm legitimately interested in cryptocurrency; I think it's a really cool idea. So what I'm hoping for is that everything goes as horribly wrong as possible, the price tanks, everyone's dreams are smashed, and all the bullshit takes disappear.

At that point, the people who are interested in building something worthwhile will be the only ones who remain, and we can work in peace.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#52

Post by agorabinary »

ordinaryradical wrote: post #9

This utopian streak running through the crypto community is what convinces me most that it’s going to be a heartbreaker. > But Hayek used the notion of distributed knowledge. Well, it looks like we do not even need that thing called knowledge for things to work well. Nor do we need individual rationality. All we need is structure. Irrational exuberance is a good thing! And while these ideologues are busy demonizing t…

If there is a fatal flaw in Bitcoin somewhere, there are hundreds of other attempts to improve upon this idea by forking the code. We will surely see dramatic changes in valuation amongst these different coins as the crypto community develops, but to think that ALL the coins will fail in their game-changer level ambition.. this does not logically follow.

In all possible worlds, individuals will fork Bitcoin and the competition for economically and technically sound digital monies will only increase. And in all possible worlds, individuals will manipulate markets with very low volume, ie. Bitcoin for most/all of its existence.

This is all deterministic. It could not be otherwise.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#53

Post by jgh »

tenaciousDaniel wrote: post #51
jgh wrote: post #44

Earlier quoted context omitted.

I honestly hope the utopian dream is smashed in the cryptocurrency community. It's not the kind of "utopia" I want to be a part of. I like the technical ideas behind cryptocurrency, but the terrible political views are off-putting.

I'm legitimately interested in cryptocurrency; I think it's a really cool idea. So what I'm hoping for is that everything goes as horribly wrong as possible, the price tanks, everyone's dreams are smashed, and all the bullshit takes disappear. At that point, the people who are interested in building something worthwhile will be the only ones who remain, and we can work in peace.

I'm sure that there will be some kind of reckoning at some point. Who knows though, maybe prices will just stabilize to the point that it becomes another boring equity.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#54

Post by eggy »

odonnellryan wrote: post #47
simias wrote: post #20

Earlier quoted context omitted.

I see many people complaining about the banking system (often for a good reason) and mention cryptocurrencies as an alternative but I'm not sure I see it. Take your anecdote for instance, what would be the equivalent in the crypto world? If you actually need to deposit fiat you'll have to use an exchange and it's basically the same problem (good luck getting an exchange to accept $250 in cash). Of course the whole th…

There are plenty of local services for you to exchange cash for BTC. Yes, very big exchange rate, but you can find these easily enough.

I get charged in the US for using a non-BoA ATM by both banks for a total charge of $5 to $6. I would consider that a big fee if you are taking out $100 USD. BoA charges me a fee to send my landlord money even if it is a 3 business day period of $10. I lived overseas for 8 years, and you could move money between banks, send a friend lunch money right after lunch with no fee, pay your gas or electric bill at a 24/7 convenience store, buy telephone credit anywhere. I lived in the rice fields of Java for a year, and could get phone and internet credit from a small shack down the road. The US had more friction for any of these tasks, and it costs more. I agree it is more blockchain I am rooting for than one singular currency like Bitcoin.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#55

Post by Changu »

matthewbauer wrote: post #34
Changu wrote: post #19

I was hoping to read his thoughts on Bitcoins market cap of about 200 Billion Dollar. I have the theory, that the value of a cryptocurrency is equal to the sum of transaction fees people will spend in the future, discounted for inflation. Currently Bitcoin users pay about $5m per day on transaction fees. That is $1.82B per year. At this rate, it would take 109 years to reach those $200B. So by that logic, the market…

Interesting thoughts but I think "the sum of transaction fees people will spend in the future" is better as a value for mining (after rewards go to 0). "Holders" really aren't wanting anything to do with transactions. My Bitcoin valuation: Bitcoin is worth as much as it costs to move to another blockchain. That's the "first-mover advantage" basically and I'm afraid it's much closer to $200 million than $200 billion.

That seems to imply that the BTC market cap is the result of speculation. Of people holding BTC because they think some greater fool will buy them later.

Personally I believe in efficient markets. I think the $200B is the best guess the market came up for the intrinsic value of BTC. Independent of speculation.

My feeling is similar to yours though. That BTCs value is closer to $200m then to $200B.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#57

Post by jstanley »

Changu wrote: post #19

I was hoping to read his thoughts on Bitcoins market cap of about 200 Billion Dollar. I have the theory, that the value of a cryptocurrency is equal to the sum of transaction fees people will spend in the future, discounted for inflation. Currently Bitcoin users pay about $5m per day on transaction fees. That is $1.82B per year. At this rate, it would take 109 years to reach those $200B. So by that logic, the market…

> I have the theory, that the value of a cryptocurrency is equal to the sum of transaction fees people will spend in the future, discounted for inflation.

How does that follow, at all?

Is the total value of all the USD in the world equivalent to the total transaction fees paid on USD in the future, discounted for inflation?

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#58

Post by sethrin »

agorabinary wrote: post #52
ordinaryradical wrote: post #9

This utopian streak running through the crypto community is what convinces me most that it’s going to be a heartbreaker. > But Hayek used the notion of distributed knowledge. Well, it looks like we do not even need that thing called knowledge for things to work well. Nor do we need individual rationality. All we need is structure. Irrational exuberance is a good thing! And while these ideologues are busy demonizing t…

If there is a fatal flaw in Bitcoin somewhere, there are hundreds of other attempts to improve upon this idea by forking the code. We will surely see dramatic changes in valuation amongst these different coins as the crypto community develops, but to think that ALL the coins will fail in their game-changer level ambition.. this does not logically follow. In all possible worlds, individuals will fork Bitcoin and the c…

>but to think that ALL the coins will fail in their game-changer level ambition.. this does not logically follow.

Good thing no one suggested that.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#59

Post by tinokid »

jm__87 wrote: post #49
ordinaryradical wrote: post #9

This utopian streak running through the crypto community is what convinces me most that it’s going to be a heartbreaker. > But Hayek used the notion of distributed knowledge. Well, it looks like we do not even need that thing called knowledge for things to work well. Nor do we need individual rationality. All we need is structure. Irrational exuberance is a good thing! And while these ideologues are busy demonizing t…

There is a distinct difference between some pump and dump strategy and a central bank printing a ton of currency. One has a temporary effect on supply and demand for the instrument in question, the other has a permanent effect.

>the other has a permanent effect

This is not really accurate. There are of course many ways both fiscal and monetary for policymakers to "tighten the screws", as it were. They just haven't chosen to do so in recent years.

Re: Nassim Nicholas Taleb, Author of Black Swan, on Bitcoin

#60

Post by jsutton »

Changu wrote: post #19

I was hoping to read his thoughts on Bitcoins market cap of about 200 Billion Dollar. I have the theory, that the value of a cryptocurrency is equal to the sum of transaction fees people will spend in the future, discounted for inflation. Currently Bitcoin users pay about $5m per day on transaction fees. That is $1.82B per year. At this rate, it would take 109 years to reach those $200B. So by that logic, the market…

Non-mining cryptocurrencies are already here, thankfully. Ethereum will be moving from mining to a Proof of Stake model; others like Dash have been successful with it for years.
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