Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

Bitcoin is a disaster

metzdowd.com

Post reply on HN
Print view View original

571–580 of 992 posts

Re: Bitcoin is a disaster

#571

Post by stale2002 »

xapata wrote: post #546
feanaro wrote: post #432

Earlier quoted context omitted.

Why is it obvious that no amount of tech can solve it? Tech can also influence policy. If something is nearly impossible to stop, it likely won't be stopped. The policy will be changed instead.

> nearly impossible to stop What's nearly impossible to stop? Can't the government simply shut down the internet to stop Bitcoin? Or insert itself as the man in the middle of all network traffic.

No, the government can't "just shut down the internet".

If any government did that, then the country would suffer extreme economic damages, if such a policy was maintained for a long time.

Your argument would be like if someone were to say "actually, the government can stop all theft, now and forever. All it has to do is launch 1 thousand nukes, start world war 3, and kill off 99% of the population".

Like, sure. The government could end the world, by launch a nuke at every major city in the world. And it is true that by doing this it would end all theft .. because everyone is dead.

But you are kinda missing the bigger picture if you are seriously suggesting this as a counter argument to anything.

Re: Bitcoin is a disaster

#572

Post by everfree »

josalhor wrote: post #268
jokethrowaway wrote: post #13

Completely agreeable, albeit it misses a point: Governments can't print more of it. That's it really, everything else is noise. I can sympathize with btc (I wish we still had a gold standard, or a standard based on the price of common goods) but I don't see much the other benefits. On top of this, governments could ban btc.

> Governments can't print more of it. I never really understood that line of reasoning. Why would one person want to reduce the ability to apply economic policy in their country? Certainly, you could use Gold instead of Bitcoin as a similar investment tool, right?

> Why would one person want to reduce the ability to apply economic policy in their country?

It might not be good for the people as a whole, but preventing your money from being inflated is very good for any given person taken individually.

Re: Bitcoin is a disaster

#573

Post by glenstein »

addicted wrote: post #95
hombre_fatal wrote: post #39

Earlier quoted context omitted.

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…

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.

>No one treats Bitcoin as a currency.

I wouldn't necessarily say that most of its market cap is coming from people treating it like a currency. But I most definitely think it is effectively a currency in some places and in some special circumstances.

I take it that the point of the post is that, by and large, due to the fact that the blockchain is public and analyzed and mining is conceivably traceable to special purpose hardware, it's not for many practical purposes usable as a stateless, institution-free vehicle for transactions.

I'm not sure how to square the circle on this, but it certainly is a currency in some cases.

Re: Bitcoin is a disaster

#574

Post by ZguideZ »

leadingthenet wrote: post #556
ZguideZ wrote: post #535

Earlier quoted context omitted.

To the system as it exists? Absolutely.

How? What I've described is closer to an oligarchy than it is to anarchy. So either you disagree with my initial description, or you disagree that that description matches something other than anarchy. Either way, I think you'll find either one of those a difficult argument to make.

Only if you presuppose that the 'small clique of miners with specialized hardware' represents the same interests as the system that bitcoin is slowly starting to displace.

Perhaps I should have specified anarchy to the system as it currently exists. It's a time bomb built and released to destroy the economic status quo.

Re: Bitcoin is a disaster

#575

Post by john_b »

tomphoolery wrote: post #319

I think the biggest failure of Bitcoin is that it was marketed as a "currency" and ended up becoming a commodity. Bitcoin isn't something you use to spend wealth, it's used to hold wealth. Unlike a stock, however, whose value is based on what price people are willing to pay for it, Bitcoin's value is determined by its scarcity. Sound familiar? That's why I hate the term "cryptocurrency". It has a lie baked right into…

It really is a currency, however. It's not a matter of perception but rather of how Bitcoin functions. The biggest difference between a commodity and currency is that a commodity is essential for some process or product. A currency is just one of many ways of funding that process/product. You can't build a computer without gold, copper, and some rare earth metals (commodities) but you can pay for it with USD, bitcoin, yuan, GBP, etc.

Aswath Damodaran has written a lot more on this topic. https://aswathdamodaran.blogspot.com/2017/10/the-bitcoin-boo...

He does agree with you in that Bitcoin will be judged as a currency, so its strengths and deficiencies as a currency will determine its fate.

Re: Bitcoin is a disaster

#576

Post by cool_dude85 »

imtringued wrote: post #486
loeg wrote: post #53

Earlier quoted context omitted.

BTC prices have approximately zero relation to inflation in the real economy (for whatever definition of that you want to use). Rising BTC prices are driven by pyramid scams, fraud, and speculation. There is no useful signal here related to anything else.

In theory the USD price of bitcoin is tracking the inflation of the USD but with excessive volatility. However, it is possible for it to grow slightly faster than inflation if a significant portion of the central bank money is arriving in cryptocurrencies. In practice it's getting dwarfed by the factors you mentioned. Lots of irrational investors are pumping BTC until it crashes. Over the long term (several decades)…

Sorry, the USD price of bitcoin is tracking the inflation of USD in theory? What theory's that?

Re: Bitcoin is a disaster

#577

Post by doopy1 »

1-6 wrote: post #511
lumost wrote: post #477

Earlier quoted context omitted.

alt-coins don't have the market depth of Bitcoin. Moving money in LTC will move the market, BTC is approaching institutional market depth.

I still question the early bag-holders of Bitcoin. Where are they and what do they do now? I think Litecoin came at a time when more people had an awareness of cryptocurrency, it's more democratized during the initial phases because of Scrypt and GPU's being the dominant mining tool at the time. ASICs shifted that balance again but I still have my doubts about who owns the majority of Bitcoin.

Bag-holder usually has the connotation of holding a worthless asset, bitcoin is currently at an all time high.

Re: Bitcoin is a disaster

#578

Post by sharpneli »

pojzon wrote: post #367
pjlegato wrote: post #328

Earlier quoted context omitted.

The entire BTC market cap is minuscule -- about 600bn as of this writing. That seems like a lot, but compare it to Apple -- the market cap of just this one company's stock is currently ~2,238bn. The market cap of gold, US dollars, Euros, etc. are all many times more than Apple. The value of all BTC is a tiny microscopic speck compared to the amount of USD or gold in the world. This means (among other things) a few sm…

To give an another view: 600bn is more than gdp of majority of countries.

For individual humans that’s like saying ”My net worth is $100k and that is more than most people earn in a year”. Yes that is true, it is larger. But it is meaningless comparison and misleading at best.

Re: Bitcoin is a disaster

#579

Post by nwienert »

StavrosK wrote: post #481
nwienert wrote: post #468

Earlier quoted context omitted.

What we define as a good currency doesn’t. A currency that inflates or deflates dramatically is foundering.

So are we talking about "a good currency", or "cash"? Because the initial comment said "cash".

I guess we’re just establishing that Bitcoin doesn’t fit the definition of a functional currency of which cash is a subset.

Re: Bitcoin is a disaster

#580

Post by lottin »

ant6n wrote: post #48
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…

But then what would one invest in? The stock market may just as easily crash.

All investments have an inherent risk. Typically there is a direct relationship between risk and return. The more risky an investment is the higher the return investors demand. Thus, when considering an investment, a key question to ask is whether the expected return on the investment is commensurate with the risk that this particular investment entails. This is called a mean-variance analysis, and before investing in BTC, or in the stock market for that matter, you should probably do exactly that kind of analysis.
Post reply on HN