Bitcoin surpasses $50K as major companies jump into crypto • Hacker News Board

Re: Bitcoin surpasses $50K as major companies jump into crypto

#241

Post by paulpan » Tue, Feb 16, 2021, 11:42 PM UTC

BenoitEssiambre wrote: post #83

It's a bit worrisome that we are inching towards the scenario where companies may be tempted at an economy wide scale to reduce investment in production in order to hoard cryptocoins instead. It caused the great depression when businesses switched to hoarding gold tied currency instead of producing in the 1930s. Now I'm not sure that crypto coins without being jacked up by central banks (like gold was during the grea…

I think the second order effect will be from companies that accumulate too much cryptocurrency - only to see its value vaporize. Impact could be systemic if companies start to essentially gamble with their treasure chests.

Example: what happens if other companies followed the likes of Tesla and MicroStrategy? Sure the $1.5B Tesla invested is pittance in the context of their market capitalization, but if Bitcoin price crashes 80% then they've lost $1.2B. Even Microstrategy, with its alleged 85% of its cash reserves in Bitcoin, might well go under if the Bitcoin price drops even 50%.

A "run on Bitcoin" could become a real thing and as impacted companies are forced to cut production and expenses to offset the losses, it creates a domino effect across the economy.

Re: Bitcoin surpasses $50K as major companies jump into crypto

#242

Post by ertian » Tue, Feb 16, 2021, 11:42 PM UTC

osrec wrote: post #208

I believe Bitcoin is the experimental precursor to proper distributed money. For some reason, even though BTC was meant to be "money", it is now being treated as an asset (at a basic level, an asset is something you hold onto, as it produces additional value, unlike money, which tends to devalue if not put to work). It's almost as if the next big idea in distributed money will be around disincentivising "asset" like…

The eventual distributed money could be bitcoin-associated without being bitcoin itself. For example, DAI[1] is (AFAICT) a derivative of Ethereum, but pinned to USD. It relies on the underlying store of value that Ethereum represents, but isn't tied to the value.

[1] https://en.wikipedia.org/wiki/Dai_(cryptocurrency)

Re: Bitcoin surpasses $50K as major companies jump into crypto

#243

Post by nacs » Tue, Feb 16, 2021, 11:42 PM UTC

bogomipz wrote: post #231

PragmaticPulp wrote: post #189

Earlier quoted context omitted.

The forefront of the Bitcoin frenzy isn't even on the blockchain, it's at the exchanges. Hardcore tech people and those who don't (or can't) trust institutions with their Bitcoin will pay the transaction fees to get their money out of exchanges and into their own wallet. The average retail investor, however, doesn't want to be their own bank. They just want in on the price action, while letting the exchange manage th…

>"Does anyone really think the person buying crypto $100 at a time in their Robinhood account wants to pay $18 (current average transaction fee) every time they want to move that BTC into their wallet?" I'm curious is this the transaction per $100 or is $18 a flat fee regardless of transfer amount?

It's per transaction regardless of amount. So a $20 transaction also has a $18 transaction fee.

Re: Bitcoin surpasses $50K as major companies jump into crypto

#244

Post by CyberDildonics » Tue, Feb 16, 2021, 11:42 PM UTC

seibelj wrote: post #18

1996 wrote: post #9

Earlier quoted context omitted.

For 12 years, just bubbles? First it was over 1 cent, then over $1, over $1000, now over $50k.... when will you consider the possibility you may have been wrong? At $100k? At $1M? (which most models indicate as a plausible target price in 10 years) Let me give you my favorite quote, pulled from another HNer comment: "I enjoy reading comments about Bitcoin here because even without any venture backing, it achieved a b…

My crypto friends have raised millions outside of VC and then became very rich once their projects launched basically over night. Liquid immediately and never paid a lawyer. Truly is a paradigm shift and I think a big problem on HN is that VC can’t see they are being disrupted and have no way of avoiding it, plus they think they are untouchable geniuses, so being wrong this hard isn’t pleasant for them.

Which part of the $28 average transaction fee is the paradigm shift?

Re: Bitcoin surpasses $50K as major companies jump into crypto

#245

Post by scarmig » Tue, Feb 16, 2021, 11:42 PM UTC

Jtsummers wrote: post #199

coinward wrote: post #176

Earlier quoted context omitted.

if you use BTC as unit of account then Bitcoin is the only thing that IS stable!

/s? That's a nonsensical statement. Use BTC to buy a car today, and then use it to buy the same value car in a year. BTC is, fundamentally, unstable at this point in time. Even when all BTC is mined and it is distributed across the globe to every human being and sentient AI and animal, it will likely continue to be highly unstable as a currency. Compare to the, relatively, stable USD as a currency. Prices for goods a…

It's all a matter of perspective. It's the entire rest of the world that's unstable and undergoing wild price fluctuations, while the value of one Bitcoin stands eternal and unchanging by virtue of it being worth one Bitcoin. /s

Re: Bitcoin surpasses $50K as major companies jump into crypto

#246

Post by petercooper » Tue, Feb 16, 2021, 11:43 PM UTC

SilverRed wrote: post #185

petercooper wrote: post #138

Earlier quoted context omitted.

That's exactly my attitude towards it too. But this has also given me a strong lesson for the future. If I get in on the ground floor of anything and decide to sell out, always keep a little skin the game that you don't touch.. because you never know if it'll go big. If the GP had sold 99% of his 3650 coins and kept 1% till now, that would still be $1.8m.

When do you sell it though? If you had coins from 2011, is now the time to sell? What if it goes up 100x next year.

Personally I would sell what I'd call the "FOMO holding" once it's worth a "life changing" amount of money. So if I held 100 Bitcoin as such a fund, that might well have been years ago, but then I'd also be retired and not care. The sister comment here is more nuanced and surely a better answer, though.

Re: Bitcoin surpasses $50K as major companies jump into crypto

#247

Post by xapata » Tue, Feb 16, 2021, 11:43 PM UTC

mandelbrotwurst wrote: post #169

azinman2 wrote: post #120

So it sounds like lemming group think. It seems like someone one should hold “just in case,” but no real valid reason to do so yet (that I’ve heard). We know transactions are slow and expensive, so it’s not a good replacement for ordinary commerce. It can be used to transfer across borders, but there often is asymmetry in capital movement that makes this difficult in the places you need it most (poor countries with r…

> it’s terrible as a wide spread value store because it removes an important tool that governments have to handle the economy (dealt with debt via inflation aka printing money How does a static rather than unconstrained supply make something a LESS good store of value?

> How does a static rather than unconstrained supply make something a LESS good store of value?

Because a healthy capitalist economy needs an incentive to invest. A steady, low, positive inflation rate is essential to encouraging those with capital to rent that capital out to those who need it for productive uses.

Re: Bitcoin surpasses $50K as major companies jump into crypto

#248

Post by PragmaticPulp » Tue, Feb 16, 2021, 11:43 PM UTC

seibelj wrote: post #18

1996 wrote: post #9

Earlier quoted context omitted.

For 12 years, just bubbles? First it was over 1 cent, then over $1, over $1000, now over $50k.... when will you consider the possibility you may have been wrong? At $100k? At $1M? (which most models indicate as a plausible target price in 10 years) Let me give you my favorite quote, pulled from another HNer comment: "I enjoy reading comments about Bitcoin here because even without any venture backing, it achieved a b…

My crypto friends have raised millions outside of VC and then became very rich once their projects launched basically over night. Liquid immediately and never paid a lawyer. Truly is a paradigm shift and I think a big problem on HN is that VC can’t see they are being disrupted and have no way of avoiding it, plus they think they are untouchable geniuses, so being wrong this hard isn’t pleasant for them.

> Truly is a paradigm shift and I think a big problem on HN is that VC can’t see they are being disrupted and have no way of avoiding it,

On the contrary, VCs are making bank on cryptocurrency. Retail investors are just along for the ride.

> plus they think they are untouchable geniuses, so being wrong this hard isn’t pleasant for them.

Again, VCs were all over cryptocurrency investments in recent years. They're ecstatic when the price goes up, because retail investors are pumping an investment they were in long ago.

I don't know how we arrived at this narrative that crypto was a win for the little guys at the expense of institutions.

Re: Bitcoin surpasses $50K as major companies jump into crypto

#249

Post by adhoc32 » Tue, Feb 16, 2021, 11:43 PM UTC

boc wrote: post #214

adhoc32 wrote: post #123

Earlier quoted context omitted.

There is the hyperbitcoinization scenario. If this holds you'll be an early adopter.

That scenario makes no sense in the real world because the US government would just regulate/ban it before it got to that point. Once BTC even starts to threaten the sovereignty and power of the USD, it's game over for Bitcoin and the laissez-faire environment that helped it grow.

At that time it will be impossible to ban because a large percentage of the US population will be exposed to it. If in spite of that they do decide to ban it there is not much they can do except ban the exchanges. The Bitcoin network is impossible to ban without heavily censoring the internet. Also what the US is going to do about the other countries of the world, invade them in order to ban the BTC?

Re: Bitcoin surpasses $50K as major companies jump into crypto

#250

Post by phatfish » Tue, Feb 16, 2021, 11:43 PM UTC

ur-whale wrote: post #50

superbcarrot wrote: post #28

Does anyone else feel like: - they've missed an opportunity to get rich with minimal effort from crypto - still have absolutely no interest in jumping in at this point?

Your feeling is IMO the norm for lots of folks. I have had this conversation with many a friend, who actually view Bitcoin as a Ponzi, and therefore decide not to play the game (a ponzi ca be lucrative if : a) you know it's a ponzi b) you're smart in your timing and not too greedy but it's still a crapshoot). The real questions are: - what if it isn't a Ponzi ? - how much will your "won't touch it with a 10 feet pole…

The same can be said of any investment opportunity. It comes down to the amount you have available to invest, and how much effort you want to put into it.

For those who want a low effort fairly safe hedge against inflation and currency changes an index tracker fund is probably the way to go.

A small percentage on risky investments is probably fine, but then you do have to choose the correct risky ones =)

I wish I had bought Tesla shares in 2011 too.