Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record • Hacker News Board

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#181

Post by anythingdude321 » Mon, Nov 30, 2020, 7:48 PM UTC

crumbshot wrote: post #29

Bitcoin and other compute-intensive cryptocurrencies should be banned or taxed so heavily that it's financially infeasible to use them. The amount of energy being wasted (reportedly more than seven nuclear power plants worth) on what is essentially an unproductive project is quite absurd. In a world where we should all be increasingly concerned about the looming climate catastrophe, it's wholly irresponsible for Bitc…

this has been discussed to death. ultimately Nic Carter's piece settles it i think: https://www.coindesk.com/the-last-word-on-bitcoins-energy-co...

"Ultimately it’s just a matter of opinion as to whether the existence of a non-state, synthetic monetary commodity is a good idea. The truth is that blockspace is a service which is paid for, and that’s where its resource cost is derived. Something duly purchased cannot, by definition, be a waste. Its buyer derives benefit from its existence, regardless of anyone else’s subjective opinion of the merit of the transaction. These same arguments have been made countless times about perceived “costs” of the gold standard, and rebutted on similar grounds before. Fundamentally, millions of individuals the world over still value physical, bank-independent savings, so it still gets pulled out of the ground with regularity. As long as people value Bitcoin, so, too, will the block-space auction continue in perpetuity.

The Bitcoin-energy worriers need not despair, however. There is a solution. All they must do is persuade Bitcoin fans to use and value an alternative settlement medium. Their best bet will be to devise a system that is even more secure, offers stronger assurances, settles faster, is more privacy preserving and is more censor resistant – all without using Proof-of-Work. Such a system would be miraculous. I’m waiting with bated breath."

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#182

Post by arcticbull » Mon, Nov 30, 2020, 7:49 PM UTC

nostrademons wrote: post #126

arcticbull wrote: post #55

Earlier quoted context omitted.

Inflation has a specific definition with reference to the cost of a set basket of goods and rent. An increase in the price of assets and assets alone as a result of an increase in money supply is not inflation.

That's the definition of the CPI. The definition of inflation that an individual cares about is "the rise in prices of the goods that I want to buy". Asset purchases, housing, and food are my biggest expenses. YMMV. I gave some examples of consumer goods inflating in my post - restaurant meals are up about 40%, housing up about 18%, groceries have also been up about 20% since the pandemic started. Also have friends t…

Asset purchases are not inflation related. If Apple goes up because their business is doing well, that’s not inflation, that’s a good investment. You need to tease apart the performance of the underlying to even get a sense of how the money supply is impacting prices. I’d love to see a study. However simply seeing stonks go up doesn’t mean inflation.

If I had to speculate the current market froth has more to do with individuals access to leveraged investments via smartphone apps like Robinhood. The pandemic has turned them into a generation of gamblers. When you buy options from a market maker they hedge by purchasing the underlying. This has a positive feedback cycle effect causing them to purchase more and more to hedge. Look up a gamma squeeze.

https://realmoney.thestreet.com/investing/stocks/is-the-gamm...

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#183

Post by X6S1x6Okd1st » Mon, Nov 30, 2020, 7:51 PM UTC

arcticbull wrote: post #89

gruez wrote: post #85

Earlier quoted context omitted.

>Energy consumption in the classical model is substantially lower because if you scaled up Bitcoin to the size of visa alone it would exceed the amount of energy generated on earth a few times over and the amount of ewaste generated on earth too. This seems to be a misunderstanding of how mining works. The amount of energy used for mining is largely disconnected from transaction volume. Mining a block with one transa…

There’s no misunderstanding. To the extent that the cap remains 7tx/sec and saturated at that level then my point remains valid. There’s no plan to change it so let’s stay away from hypotheticals.

Yup, last I checked there is so much resistance to increasing the block size that there was multiple forks about it.

The hope for scaling bitcoin is on stuff like the lightning network and other more esoteric stuff like coinjoin. That being said lighting network could scale arbitrarily in theory, but the security properties depend on being able to tx on the main chain in a timely manner. In the case that there is a wide spread theft attempt on the lighting network we could see many LN channels trying to be closed at the same time and shooting the fees up beyond the attack value.

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#184

Post by arcticbull » Mon, Nov 30, 2020, 7:51 PM UTC

brian_cloutier wrote: post #177

JoeAltmaier wrote: post #171

Earlier quoted context omitted.

Yeah and anybody who loses their money on the stock exchange, already spent that money on a security and then the security lost value. What's the difference?

The GP seems to be implying that using bitcoin is risky, which is true, but as evidence cites someone who lost money while not holding bitcoin. I'm sure people also lost CAD they had been storing in Quadriga; when you put money into an uninsured bank/exchange you might lose it, losing it is not evidence that bitcoin itself is risky.

You can’t spend Bitcoin anywhere which means you need to rely on these exchanges to get something you can exchange for goods and services. This makes them a mandatory part of the exchange transaction and ecosystem as such their risk must be factored in. You can’t pretend the platonic ideal exists for crypto when comparing it to real world pricing and risk for existing solutions. That’s disingenuous at best.

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#185

Post by georgesC » Mon, Nov 30, 2020, 7:57 PM UTC

arcticbull wrote: post #165

cloudinshape wrote: post #158

Earlier quoted context omitted.

> You take your fiat and you invest it and nothing you say below the first paragraph matters. If only. The problematic part of a fiat system is not that is fiat, but that is in the hands of the government who knows not how to exercise constraint and inflates it at will to "pay" for things, more realistically, to promise to pay for things that if it had to actually pay for it will never be able to afford. > The issue…

> The problematic part of a fiat system is not that is fiat, but that is in the hands of the government who knows not how to exercise constraint and inflates it at will to "pay" for things, more realistically, to promise to pay for things that if it had to actually pay for it will never be able to afford. If economic growth outpaces debt growth then it does not ever have to be paid back. > ...what do you think money…

The fact that so many people don't know that cash/fiat is losing value over time makes it somewhat of a problem. Furthermore the creation of cash/fiat creates high benefits to those that benefits from the newly created money first, before the money spreads and devalues its value due to inflation over time.

Inflation vs deflation debate is a complicated one, I don't know which is best in terms of enabling technical progress. One is more short termist, another is more long termist.

But fiat/inflated currencies won't go away. It's just that those kinds of currencies just tends to blow up at some point because of inflation and human nature. It's more than nice to have other options, especially digital. The idea to have some kind of worldwide standard that is open and won't change is also nice.

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#186

Post by anythingdude321 » Mon, Nov 30, 2020, 7:58 PM UTC

arcticbull wrote: post #165

cloudinshape wrote: post #158

Earlier quoted context omitted.

> You take your fiat and you invest it and nothing you say below the first paragraph matters. If only. The problematic part of a fiat system is not that is fiat, but that is in the hands of the government who knows not how to exercise constraint and inflates it at will to "pay" for things, more realistically, to promise to pay for things that if it had to actually pay for it will never be able to afford. > The issue…

> The problematic part of a fiat system is not that is fiat, but that is in the hands of the government who knows not how to exercise constraint and inflates it at will to "pay" for things, more realistically, to promise to pay for things that if it had to actually pay for it will never be able to afford. If economic growth outpaces debt growth then it does not ever have to be paid back. > ...what do you think money…

Run for office? I prefer the trim tab approach: https://en.wikipedia.org/wiki/Trim_tab#Trim_tab_as_a_metapho...

If Bitcoiners are right, Satoshi has been the trim tab of the century thus far. Time will tell :)

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#187

Post by arcticbull » Mon, Nov 30, 2020, 7:58 PM UTC

cloudinshape wrote: post #173

hahaxdxd123 wrote: post #167

Earlier quoted context omitted.

Those things got cheaper because of advances in supply chains and technology. I mean you can just do the simple mathematics. Suppose there are 100 utility units of wealth in the world - machinery, homes, anything tangible to improve lives - and 100 units of currency to match. Through human labour we produce another 100 utility units. Now each unit of currency can provide me 2 utility units. This is just a system that…

> Those things got cheaper because of advances in supply chains and technology. That is why things get cheaper all the time, yes. > Why in the world would I ever loan to a small business if I could see gains just by holding the money? The same reason you do now, which is the only reason you ever lend money: by lending it (to someone more productive than yourself of course) you gain more.

You have to compare it to your risk free return lol

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#188

Post by arcticbull » Mon, Nov 30, 2020, 8:01 PM UTC

X6S1x6Okd1st wrote: post #183

arcticbull wrote: post #89

Earlier quoted context omitted.

There’s no misunderstanding. To the extent that the cap remains 7tx/sec and saturated at that level then my point remains valid. There’s no plan to change it so let’s stay away from hypotheticals.

Yup, last I checked there is so much resistance to increasing the block size that there was multiple forks about it. The hope for scaling bitcoin is on stuff like the lightning network and other more esoteric stuff like coinjoin. That being said lighting network could scale arbitrarily in theory, but the security properties depend on being able to tx on the main chain in a timely manner. In the case that there is a w…

Well a lightning channel requires 1 on chain transaction to open and 1 to close so it’d cost $12 and for everyone on earth to open and close a single channel would take over 70 years. So it’s not really a scaling solution. And L2 isn’t blockchain anyways, you could conceivably implement lightning with classical assets.

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#189

Post by captn3m0 » Mon, Nov 30, 2020, 8:04 PM UTC

brian_cloutier wrote: post #106

CJefferson wrote: post #84

Earlier quoted context omitted.

Bitcoin costs about 6$ per transaction (based on block reward). That is more than many transactions I make. Also, if you are using electricity to heat a house, heat pumps are about 4x more effective than bitcoin mining. This "mine for heat" meme has no real basis in fact.

I admit $6 is very expensive when compared to credit card fees, but Bitcoin is the only way I know of sending someone in a different country $10k for just a $6 fee. It would still be $6 if you sent $1M.

The fact that credit card fees are high is not reason enough for Bitcoin to win this forever. Nothing stops interchange from switching from a % model technically - the costs to the issuer and the network scale on a txn basis (same as bitcoin). All it takes is banks to cap their interchange - which they can, if bitcoin ever becomes competitive?

Re: Bitcoin Price Hits All-Time High of $19,786, Topping 2017 Record

#190

Post by anythingdude321 » Mon, Nov 30, 2020, 8:05 PM UTC

dustingetz wrote: post #35

jayd16 wrote: post #22

Can someone explain why BTC going from 13k to 20k in a month isn't the yearly pump and dump?

Patio11's take: (2019) "Credit bubble? Yes, there can no longer be serious doubt about this: people bought Bitcoin with money that didn’t exist, pushing up the price of Bitcoin. A lot of people currently think they are richer than they are." https://www.kalzumeus.com/2019/10/28/tether-and-bitfinex/ I'd be interested in reading a counter-take, most bitcoiners I know just look away.

Tether has accounting problems and remains a systemic risk. But this is mitigated by several factors. First, they are semi-audited and most educated guesses suggest they are collateralized one-to-one with $ at 70% or more. Second, tethers have become less systemically important over time, as other, better audited (or collateralized) stables have taken market share — this trend will likely continue. Third, tether brr doesn't compare to Fed brr and never will be able to, so ultimately, this won't matter in the long run.