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Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

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Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#81

Post by bartimus »

cal5k wrote: post #43

I find it amusing that media doesn't give a crap about Bitcoin until there's price action. This was the exact same type of article that was dominating headlines back in the 2017 run-up. Bitcoin has proved remarkably resilient over the last 10 years. It's clear (to me, anyway) that this asset class/set of technologies is here to stay, it's really just a question of what comes of it. It's actually quite useful to be ab…

It's exactly now running into its hardcoded bandwidth limit again:

https://bitinfocharts.com/comparison/bitcoin-transactions.ht...

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#82

Post by jraedisch »

sprash wrote: post #78
jraedisch wrote: post #76

Earlier quoted context omitted.

If I buy BTC and prices rise enough, I can sell for more than I paid, pay my debt and still keep some. In this scenario the majority of people who did not buy BTC or other less inflationary assets will suffer a lot more than me.

If you can stomach the volatility and really like risk just go ahead and max out all your credit cards. Just don't be the guy who buys the top.

Maxing out credit cards has nothing to do with it. Nobody is forcing you to do that. How much you buy is depending on you, and it should be an amount that you won't need in the coming ??? (4 seems to be a good guess) years.

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#83

Post by jfengel »

jraedisch wrote: post #73
netwanderer3 wrote: post #72

Earlier quoted context omitted.

Exactly! BTC futures or derivatives were precisely the tools that were used. With Bitcoin derivatives, essentially you don't even need to own any Bitcoin at the present to trade since it's a future contract. BTC price reached its peak at $20,000 on December 17, 2017 which happened to be the exact same date that the CME Group (Chicago Mercantile Exchange) became the first provider of Bitcoin derivatives to the market.…

Then why isn't everybody shorting everything all the time?

Shorting exposes you to effectively infinite upside risk. If you shorted one BTC at $4,000 a few months ago, today you'd have lost almost $5,000. If it goes to $20k again, you could be out $16,000.

It's not like a regular asset, where the most you can lose is what you put in. You could lose literally everything.

In the case of stocks, there is some limit in the sense that there's an underlying asset. There's some dispute as to the real long-term value of a share of Facebook or Netflix or Google, but ultimately there is one: your share entitles you to a piece of the profits of that company. It's still possible to lose a huge amount of money shorting stocks (say, you short a nearly-worthless stock in a drug company whose product is surprisingly approved), but it's very rare.

With bitcoin, there's no underlying value to the asset. That makes it extremely volatile; there's no sound way to guess what it could ultimately be worth. Further, unlike stocks, there's no regulator trying to put a damper on price manipulation. (Basically, every dirty trick that was ever tried in the stock market now has rules against it, but they all get dusted off and tried again.) So shorting BTC puts you at significant risk.

Some people are long on BTC because they think that ultimately there is a real value there, and happens to be higher than the current trading price. Their willingness to do so is what will ultimately determine that long-term price. Shorting it is betting that they're wrong... assuming you have the financial wherewithal to wait for the "long term". Or are willing to assume the risk that you're right in the short term, too.

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#84

Post by Balgair »

cal5k wrote: post #56
Frondo wrote: post #53

Earlier quoted context omitted.

The problem I think a lot of people have with Bitcoin, at least that ends up producing articles like this, is that there's always a tremendous amount of goalpost-shifting in the Bitcoin/adjacent community. At times it's been talked about as a replacement for cash in the sense of using it for lots of low-value transactions (it won't work), as a value store (it fluctuates a LOT for that), for sending money across borde…

Well, I think nobody knows exactly what it is yet. It's an emerging technology, so even if there's a great deal of utility it's not surprising that predictions will be off the mark/downright wrong, and that opportunities will be missed that eventually seem obvious in retrospect. And there is no cohesive "community" that's making predictions and measuring against them. It's just people speculating out loud, and then o…

> Resilient as in despite 10 years of continuous doomsday prognostications,

> It's an emerging technology,

What are the timelines like here? If 10 years is too short to suss out what BTC is going to be useful for, will another 10 years help? Is this a 100 year long thing then?

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#85

Post by petraeus »

mindfulplay wrote: post #23
vasilipupkin wrote: post #14

People trading something back and forth is a form of usage. they are using it. The author just doesn't like what they are using it for.

Like Pokemon cards? It's fun. But does not carry any value. You can't buy a car or toilet paper with your precious Pokemon cards.

You sure can if you find somebody willing to take them

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#86

Post by cal5k »

Balgair wrote: post #84
cal5k wrote: post #56

Earlier quoted context omitted.

Well, I think nobody knows exactly what it is yet. It's an emerging technology, so even if there's a great deal of utility it's not surprising that predictions will be off the mark/downright wrong, and that opportunities will be missed that eventually seem obvious in retrospect. And there is no cohesive "community" that's making predictions and measuring against them. It's just people speculating out loud, and then o…

> Resilient as in despite 10 years of continuous doomsday prognostications, > It's an emerging technology, What are the timelines like here? If 10 years is too short to suss out what BTC is going to be useful for, will another 10 years help? Is this a 100 year long thing then?

It's useful now. It could be more useful in the future, or it could be supplanted by something else. All I'm saying is that big changes don't happen as fast as people expect, and it's hard to determine where they'll go while they're happening. See: the internet, cell phones, desktop computers, space travel, etc.

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#87

Post by johnpowell »

cal5k wrote: post #86
Balgair wrote: post #84

Earlier quoted context omitted.

> Resilient as in despite 10 years of continuous doomsday prognostications, > It's an emerging technology, What are the timelines like here? If 10 years is too short to suss out what BTC is going to be useful for, will another 10 years help? Is this a 100 year long thing then?

It's useful now. It could be more useful in the future, or it could be supplanted by something else. All I'm saying is that big changes don't happen as fast as people expect, and it's hard to determine where they'll go while they're happening. See: the internet, cell phones, desktop computers, space travel, etc.

Internet was expensive when it came out. Remember when it used to be pay by the hour and tied up your landline? I had internet through the University and had to kick people out of my apartment because they would sit at my computer forever.

Everyone I knew in high school wanted a cellphone but couldn't afford it. Same with desktop computers. Same with space travel. Everyone wanted that that stuff but it was expensive.

Bitcoin isn't hard or expensive to get. But still nobody wants it.

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#88

Post by village-idiot »

jraedisch wrote: post #41
village-idiot wrote: post #30

Earlier quoted context omitted.

So bitcoin is more valuable than its hard forks because there’s more hashing power. Ok, that makes sense. So why is there more hashing power on bitcoin than the hard forks? Oh, because bitcoin is more valuable and so the mining reward is higher once converted to fiat? Well, that seems like a problem.

Why?

Circular dependencies are never considered a good thing.

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#89

Post by bdcravens »

seibelj wrote: post #35

HN is full of bitter commenters who have been predicting the death of cryptocurrency for a decade, and it hasn’t come true. A community that learned of Bitcoin right as it was invented, dismissed it, and missed out on huge fortunes. Well, some people here thought for themselves and analyzed the technology and ideas on its merits. Just not the people who comment on these posts.

> some people here thought for themselves and analyzed the technology and ideas on its merits

I was mining back in 2011, so I'm very familiar with the technology and its merits. I've witnessed the price swings, the FOMO, the exchange "hacks". I'm very active in Bitcoin discussions under a pseudonym.

My conclusion: the technology and the price are orthogonal.

Re: Bitcoin's Rally Masks Uncomfortable Fact: Almost Nobody Uses It

#90

Post by sireat »

cal5k wrote: post #43

I find it amusing that media doesn't give a crap about Bitcoin until there's price action. This was the exact same type of article that was dominating headlines back in the 2017 run-up. Bitcoin has proved remarkably resilient over the last 10 years. It's clear (to me, anyway) that this asset class/set of technologies is here to stay, it's really just a question of what comes of it. It's actually quite useful to be ab…

What kind of progress has been made in crypto currency adoption?

After 10 years there really is nothing to show for it.

I mined a few coins in 2011 and they were quite useful in the 2013 boom when there were various merchants experimenting with adoption.

Since then the merchant adoption has only gone down.

Bitcoin will continue to have value because of its use in very shady transactions:

  * hard drugs

  * avoiding capital controls(China, Russia etc)

  * extortion, blackmail

  * crypto scams

  * pure speculative/gambling vehicle
Sadly, there is no cryptocurrency which is useful as a general purpose e-money.

That is: as a buyer you get no protection and pay more as compared to regular credit card. Why in the world would you use it unless you want to use it for something shady?

Now one could argue that capital controls and hard drugs should be legal but that doesn't change the problem that bitcoin and other cryptocurrencies only exist to serve markets that nation states deem illegal.

Compare this to regular gold and cash.

Finally, the big problem is the energy use. If BTC runs to 50k-100k then the energy consumption used for mining will surely surpass that of a medium sized country. If speculators push the price of BTC to say 500k, then the whole world will stop and half the energy will be used to mine BTC.

It is ridiculously silly yet dangerous.

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