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Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

nytimes.com

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Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#361

Post by cup-of-tea »

ceejayoz wrote: post #356
cup-of-tea wrote: post #346

Earlier quoted context omitted.

Have you never been to an ATM that has run out of cash? You can't make a run on the banks any more. They'll just tell you, sorry, they've run out of cash. You'll still be able to pay your bills and taxes using legal tender, though (bank dollars). I've already told you the fact that 95% of money doesn't exist outside of the private banking system. What kind of regulation do you think is stopping everyone from wanting…

> What kind of regulation do you think is stopping everyone from wanting to get paper money for their entire life savings? That's missing the point. The point of regulation is building a society where you don't need to do that. A bank collapse no longer means you lose your money - the FDIC insures a good-sized chunk, and the Feds come in and take over operations temporarily. Bank runs are prevented not by having enou…

The paper money doesn't exist.

Who do you think is footing the bill when the government has to step in? The banks or the government? Wonderful regulation...

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#362

Post by pluto9 »

Spooky23 wrote: post #199
trendia wrote: post #188

Earlier quoted context omitted.

This may be true, but the government also has the power to control inflation, which limits the purchasing power of those dollars. See: Venezuela, Zimbabwe, Germany ~1920

Debt instruments are based on faith and credit. Those events are indicative of scenarios where the market lost confidence in the faith and credit of those nations. When you can't sell bonds anymore, you implicitly borrow by devaluing the money. That's where the derogatory treatment of "fiat" money by goldbugs and cryptocurrency advocates falls down. A government can declare that something is worth a dollar, but the m…

> A government can declare that something is worth a dollar, but the market determines what a dollar is worth.

So what happens when the government declares that a candy bar is worth a dollar, but the market determines that a dollar is worth half a candy bar?

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#363

Post by rrcaptain »

arisAlexis wrote: post #350
zik wrote: post #309

Earlier quoted context omitted.

But it's claimed that it's not really a peg system at all - that Tether were fraudulently created while claiming they were pegged.

yes and because someone wrote about it then it's true right? I can't think of anybody wanting to spread FUD to profit from shorting...for the life of me, really. Who is the manipulator in this case?

Except Tether hasn't actually proved they have the cash they claim. So why should we take their word that they're a peg system when they haven't proved it?

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#364

Post by ceejayoz »

cup-of-tea wrote: post #361
ceejayoz wrote: post #356

Earlier quoted context omitted.

> What kind of regulation do you think is stopping everyone from wanting to get paper money for their entire life savings? That's missing the point. The point of regulation is building a society where you don't need to do that. A bank collapse no longer means you lose your money - the FDIC insures a good-sized chunk, and the Feds come in and take over operations temporarily. Bank runs are prevented not by having enou…

The paper money doesn't exist . Who do you think is footing the bill when the government has to step in? The banks or the government? Wonderful regulation...

> Who do you think is footing the bill when the government has to step in?

Banks pay insurance premiums to the FDIC.

> The paper money doesn't exist.

Who cares? A college diploma that's not printed out is still a college diploma. I don't need to be able to physically hold it in my hands, and if a hundred thousand people all asked the Bursar's Office for a copy, they wouldn't be able to do so in a timely fashion either.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#365

Post by spiorf »

ethbro wrote: post #117
spiorf wrote: post #79

Earlier quoted context omitted.

This is the internet, and those weapons can't fire down here. Try, instead, to delete a two week old transaction from the bitcoin blockchain. You will find that even with military-sized funding, you can't. That's what is backing up bitcoin's value

At USD$6.5B for a 51% attack (scraped off a website)... ... that's a smidge over 1% of the US military budget.

51% lets you censor transactions. You need more than that to reverse a week old tx. Way more. You have to outrun the rest of the world and gain a week of advantage. So if you have 90% of the hashrate, you go 9 times faster than the honest miners. Every day, you can erase 9 days of blockchain. But that 90% means that you build a mining farm that is 9 times greater that the current hashrate. Redo the math on the costs and logistics of that.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#366

Post by spiorf »

joejerryronnie wrote: post #204
spiorf wrote: post #79

Earlier quoted context omitted.

This is the internet, and those weapons can't fire down here. Try, instead, to delete a two week old transaction from the bitcoin blockchain. You will find that even with military-sized funding, you can't. That's what is backing up bitcoin's value

If the world's financial stability is at risk due to crypto-currency, you will see how easy it is for the government to effectively shut down the internet. What good is the bitcoin blockchain when all ISPs have been locked down and the only internet traffic is going directly through military run equipment?

It would be an economic suicide for the first country that decides to disconnect itself from the internet. Or do you think that for the first time in history of mankind, every single government will come together against bitcoin? Besides, there are satellites beaming down bitcoin transactions, so...

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#368

Post by sfifs »

arisAlexis wrote: post #299
achompas wrote: post #238

Earlier quoted context omitted.

> Making people believe that the money you've created with whatever hocus-pocus is real and that investment X will just spew money indefinitely is not at all a new thing. Across so many people, and at BTC's market cap though? I think that's unprecedented. Penny stocks or pyramid schemes, sure, but they never affect this many people or hit 12-digit valuations. (By the way, fiat money doesn't count as an example becaus…

usdt is a usd peg system with no fake money. did you ever read the technical details?

The problem is they have never demonstrated they actually have the money. It's very simple really to ask your bank to provide a certified and digitally signed account statement. This routinely happens in audits. Tether has never showed this. So the accusation is that its operation is basically fraud.

Re: Bitcoin’s Price Was Artificially Inflated Last Year, Researchers Say

#369

Post by sserrot »

nostrademons wrote: post #337
headsoup wrote: post #330

Earlier quoted context omitted.

That would assume that it is 'different' money changing hands would it not? I.e. that %500M and $90B is unique dollars being transacted and not just promises being passed back and forth.

It does, and that's an assumption that probably doesn't hold. Most things in the economy work that way though - the total supply of hard currency in the economy is only $3.6T, so when you speak of the $18T US GDP or the $20T US national debt or the $524T value of the derivatives market, it necessarily accounts for the same dollar changing hands multiple times. That's what makes it a currency, that it can circulate an…

Saying the 'value' of the derivatives market is $524T is disingenuous. The notional value - sure, but that's like saying the value of the lottery 'market' is the jackpot times all the outstanding tickets - http://www.newsweek.com/600-trillion-derivatives-market-9227...
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