Bitcoin is a disaster • Hacker News Board

Re: Bitcoin is a disaster

#301

Post by mden » Thu, Dec 31, 2020, 11:53 PM UTC

spottybanana wrote: post #184

If you think Bitcoin is bad, don't use it. Bitcoin is free market protocol. Often in free market it comes down to preferences, and this kind of opinion pieces are just a statement that I don't like what other people don't like, and other people shouldn't like what they like.

This type of mentality stunts discussion and equally applies to your comment as well as the post. If you truly believed in what you wrote you would simply ignore an opinion piece that you didn't like instead of commenting on it.

Re: Bitcoin is a disaster

#302

Post by tekkk » Thu, Dec 31, 2020, 11:54 PM UTC

option wrote: post #116

addicted wrote: post #95

Earlier quoted context omitted.

No one treats Bitcoin as a currency. It’s treated as an investment vehicle. And the reason behind that is obvious. Something whose value may double in a month or whose value may halve within weeks is a terrible currency. If I expect it’s value to increase then I would be a fool to spend it. If I expect it’s value to drop I would be a fool to accept it. Cryptocurrencies are anything but currencies.

I grew up in Ukraine where my parents were earning and spending hryvna (local currency, high inflation) while saving in USD (much more stable). And a big value prop in favor of US dollar was its immunity to local country’s politics. Bitcoin has a potential to serve as that kind of saving “currency” a lot of people actually need.

Not to burst your bubble but assets with extreme volatility, like bitcoin, are not suitable for saving purposes. Investment maybe, but not saving. I assume "saving" purpose in this case means that it withholds its value while being easily liquidable.

If you on the other hand have a long saving window so you can tolerate huge swings in the price of the bitcoin (or other cryptocurrency) then the question arises why not diversify your investments like regular people and buy ETFs or other assets?

Maybe buying ETFs is harder than buying bitcoins, but in general the idea is (I assume) the same. However, what I feel most people are allured by with bitcoin is its random price movements where out of nowhere its price surges up and creates a total hysteria in the market.

I myself heavily dislike assets which price is mainly driven by emotional rationale and while bitcoin's idea may be good, I would not suggest anyone to put their savings in bitcoin. It would seem to encourage people to treat markets with magical thinking where the prices are set by otherworldly powers and not as tied to the revenue stream that is generated by the said asset.

Re: Bitcoin is a disaster

#303

Post by haolez » Thu, Dec 31, 2020, 11:54 PM UTC

wcoenen wrote: post #288

keithwhor wrote: post #24

Related: the current rise of Bitcoin prices has been peculiar to me, and seems to be a bit of a canary in an inflationary coal mine. We've injected trillions of dollars of fiat into the economy this year. It feels like the sky-high valuations of technology companies and Bitcoin are "shock absorbers" of sorts, or early signals of inflation-yet-to-come. If we assume the market is efficiently pricing these assets (like…

> We've injected trillions of dollars of fiat into the economy this year When the government issues debt and then uses the money to send out cheques, that money had to come from investors in the first place. So the money was reallocated, not created. (New assets did get created: someone is going to hold those bonds and count them as part of their assets. But they can't use these bonds directly to buy groceries.)

Let's inject quadrillions, then!

Re: Bitcoin is a disaster

#304

Post by cambalache » Thu, Dec 31, 2020, 11:54 PM UTC

I agree with most of the points raised by the author but as a Venezuelan Bitcoin is a godsend. If you live abroad and want to send remittances to your friends and family it can be pretty easy in a normal country , with wire transfers,western union and so on. If your family lives in Venezuela your options are extremely more limited.

These are some of the options Venezuelans have had to use:

1. Ask the money to be sent to Colombia with WU and then travel hundreds of kms to get what usually amounts to a few hundred dollars at most.

2. Use Zelle, send dollars in the US, and receive Bolivares in Venezuela. But for that you need to have an US bank account, and find a person you can trust also with an US bank account and plenty of highly volatile Bolivares in Venezuela willing to make the exchange.

3. Use paypal, same as above with way higher commissions and the risk that paypal (and the other person) will fuck you.

4. Buy Amazon gift cards and use the same schema above, be exposed to scams and high commisions fees.

Trading bitcoins in say localbitcoins.com, you have a very liquid market and somewhat secure transactions (Bitcoins are not liberated until you check the money is in the Venezuela account). There are risks of course, especially because of BTC volatility but at least is a fast,convenient,widespread option. I wish something like that, only more stable and with less of that Tulip-craze whiff BTC has.

Re: Bitcoin is a disaster

#305

Post by hnracer » Thu, Dec 31, 2020, 11:55 PM UTC

bostonsre wrote: post #216

hnracer wrote: post #155

Earlier quoted context omitted.

You can just hedge your exposure on a futures exchange and still use BTC to transact but be unexposed to any price movements. Although doing that is very complicated and defeats the purpose of an easy to use alternative to centralized cash.

That sounds like it could be a PITA for everyday people tho.

Indeed but I wonder if one could build a platform that does this behind the scenes. User sends BTC to the online wallet, and the site hedges on behalf of the user on one of the liquid future exchanges, locking in the prevailing BTC price. People can make payments out of this online wallet with just as much ease as they're currently doing. Then they have an easy to use digital cash without any price risk.

The site charges a small fee for the service of derisking the holdings.

This does seem to solve a real user pain point (risk and the complexity of hedging) and benefits from scale economies.

Re: Bitcoin is a disaster

#306

Post by TedDoesntTalk » Thu, Dec 31, 2020, 11:56 PM UTC

ojhughes wrote: post #281

almost_usual wrote: post #246

Earlier quoted context omitted.

So buying drugs in 2010 makes it a currency, gotcha.

Last time I checked drugs were still pretty popular in 2020 and no one wants to hang around big Daves dirty house to buy some weed

Monero is used now. Not Bitcoin.

Re: Bitcoin is a disaster

#307

Post by acover » Thu, Dec 31, 2020, 11:56 PM UTC

wcoenen wrote: post #288

keithwhor wrote: post #24

Related: the current rise of Bitcoin prices has been peculiar to me, and seems to be a bit of a canary in an inflationary coal mine. We've injected trillions of dollars of fiat into the economy this year. It feels like the sky-high valuations of technology companies and Bitcoin are "shock absorbers" of sorts, or early signals of inflation-yet-to-come. If we assume the market is efficiently pricing these assets (like…

> We've injected trillions of dollars of fiat into the economy this year When the government issues debt and then uses the money to send out cheques, that money had to come from investors in the first place. So the money was reallocated, not created. (New assets did get created: someone is going to hold those bonds and count them as part of their assets. But they can't use these bonds directly to buy groceries.)

I think quantiative easing added trillions of dollars during covid.

https://en.wikipedia.org/wiki/Quantitative_easing

Re: Bitcoin is a disaster

#308

Post by 542458 » Thu, Dec 31, 2020, 11:56 PM UTC

sunshinerag wrote: post #229

542458 wrote: post #153

Earlier quoted context omitted.

Economists weren’t born yesterday. Inflation is measured in many ways, most often by looking at a basket of goods where the prices are relatively non-volatile. Using the USD/Bitcoin ratio as a yardstick for inflation seems very misguided, as Bitcoin is heavily speculated.

>> Economists weren’t born yesterday. So? They can still be idiots. Idiocy does not have an age limit. >> Inflation is measured in many ways, most often by looking at a basket of goods where the prices are relatively non-volatile. Meaning you remove the items from the basket if it's price jump too much ? so if you tamper with the items in the basket you can project(pretend) that the inflation is not happening.? >> us…

It seems a bit arrogant to claim that every one of the thousands of economists who study inflation are idiots.

You can look up the methodologies used to determine the basket of goods. By non-volatile I mean that they’re aggregates over purchasing categories - for example, it’s not the simply the price of a “40inch TV” or cod fillet (which may change in ways non-representative of general purchasing practices - as TVs of a given size get cheaper, or cod has a good year) but an aggregate over the entire purchasing category (fresh fish, consumer electronics) based on typical purchasing habits.

https://www150.statcan.gc.ca/n1/pub/62f0014m/62f0014m2019001...

When things are added or removed it’s because people have stopped buying that thing (DVD rentals for example).

Re: Bitcoin is a disaster

#309

Post by PaulHoule » Thu, Dec 31, 2020, 11:57 PM UTC

hombre_fatal wrote: post #39

Barrin92 wrote: post #3

>The scarcity of block chain space has led people to re-invent every last feature of the banks they thought they were going to be escaping. This is a pretty funny point because every time I go on twitter and see people talk about crypto, what they're essentially having is a discussion about public policy, and often they seem to try to reinvent institutions that already exist without even knowing it. From market-maker…

I don't see the irony. The point is that Bitcoin has introduced an actual "digital cash" currency without institutional/governmental middlemen. That institutions can be built on top of that, and that some people want such institutions, doesn't change the novel utility of finally having a currency that functions like digital cash. It's like saying it's ironic that people use physical USD for anonymous p2p transactions…

Bitcoin is the digital version of those huge coins people had on Easter Island. Had the Easter Islanders invented fractional reserve banking they might have taken over the world instead of England.

Re: Bitcoin is a disaster

#310

Post by progval » Thu, Dec 31, 2020, 11:57 PM UTC

spottybanana wrote: post #184

If you think Bitcoin is bad, don't use it. Bitcoin is free market protocol. Often in free market it comes down to preferences, and this kind of opinion pieces are just a statement that I don't like what other people don't like, and other people shouldn't like what they like.

Bitcoin is also bad for you even if you don't use it. Greenhouse gas emission affects everyone, for example. So it makes sense to try to convince others to stop using it as well.