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Bitcoin surpasses $50K as major companies jump into crypto

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

#441

Post by tylerhou »

hanniabu wrote: post #414
tylerhou wrote: post #346

Earlier quoted context omitted.

Your question is not very meaningful/vacuously true for two reasons. 1. The premise is false. Bitcoin does not have the same demand as the USD. 2. The whole point of my original comment is that value is a result of demand. So your question is circular. " If Bitcoin had equal demand to the USD, then it would be a better store of value" is as logical a statement as "if my grandmother had wheels, she would be a wagon, i…

So value is only a result of demand for USD but when it comes to BTC that doesn't apply?

Value is a product of demand for both USD and BTC. So as I said above, your question was tautologically true: if the demand of Bitcoin will always be high, then yes it will be a store of value, because things that are in high demand have value. But that is true for any good.

I could ask the same question about cow dung, or any scarce good. If the demand for cow dung was as high as the USD, will it be a stable store of value? Yes.

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

#442

Post by fomine3 »

MarkPNeyer wrote: post #271
Chico75 wrote: post #268

Earlier quoted context omitted.

This is exactly why there are so many skeptics. Too many people trying to sell it as a "get rich quick" investment without downsides while there are so few concrete use-cases so far.

https://reason.com/video/2021/02/05/bitcoin-is-protecting-hu... Bitcoin is used by people under authoritarian regimes around the world. IF nothing else, i'm happy to support people protesting in belarus.

Is rising price "supports" those people? I suspect that they have to pay more transaction fee due to rised price.

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

#443

Post by tylerhou »

disruptalot wrote: post #322
PragmaticPulp wrote: post #259

Earlier quoted context omitted.

Exactly. Bitcoin proponents tend to tell only half of the story, and pick and choose economic theory that fits the "buy more bitcoin" narrative. In economic terms, Bitcoin is inflating as an asset. Specifically, it's demand-pull inflation. Bitcoin isn't even uniquely positioned to protect against inflation, other than the mistaken public belief on that topic. Inflation is an increase in the price of assets, so invest…

When Bitcoiners talk about "inflation" they don't mean inflation of prices. They mean loss of purchasing power. Demand-pull inflation in fact is exactly what is happening with Bitcoin and bitcoiners would agree. There's huge demand for bitcoin and an ever reduction of circulating supply. What that means is that it can maintain/increase purchasing power incredibly relative to other assets that have unconstrained and e…

Demand-pull inflation is not happening with Bitcoin. Again, inflation refers to the devaluation of currency. If the purchasing power of Bitcoin goes up, Bitcoin is deflating, not inflating.

Maybe you are trying to say that the USD is inflating (w/ demand-pull inflation) because USD is becoming less valuable, relative to Bitcoin.

But that theory is still problematic, since you can't measure inflation against just one asset. An asset might appreciate because of a shift in consumer demand -- the currency itself might not have "devalued." Instead, a better way to measure inflation is wrt. a basket of goods, like CPI. CPI has not changed much in the last year, which implies that the USD is not inflating much.

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

#444

Post by ceejayoz »

tuesdayrain wrote: post #419
trident5000 wrote: post #260

Earlier quoted context omitted.

The average transaction fee is a bit disingenuous. Many people are not even using segwit and thats on them. You can also use lightning at this point in time but people dont know how to do it and wallets have not implemented yet. High fees usually prod people and services to adapt to the current tech to get costs down. I expect this to happen soon as high fees are somewhat recent. Also you can send a 50 cent tx fee an…

>One other thing - you cant even move BTC in or out of Robinhood. Robinhood for crypto is a complete scam right now. I definitely would not call that a scam. I have no reason to move my BTC.

"my"

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

#445

Post by azinman2 »

fwiwm2c wrote: post #299
gibbonsrcool wrote: post #265

Earlier quoted context omitted.

Is this sarcasm? Honestly can't tell.

No it is not sarcasm. You all are missing out on the train going right in front of you. The point here is that you all are not even trying to understand the advantages of crypto - with innovations such as DeFi, NFT and Store of Value. For you, it comes back to Bitcoin wasting energy and the fact that it is being used by criminals. Keep on believing your theories while the rest of us become rich.

Your argument is just appealing to authority. You also assume I don't even have any bitcoin, and that I've never 'gotten in'. None of this answers my original questions as to why Bitcoin is a shrewd investment with long-term potential versus being a Ponzi scheme.

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

#446

Post by fomine3 »

I_am_tiberius wrote: post #387
Wowfunhappy wrote: post #355

Earlier quoted context omitted.

My opinion of Bitcoin will change when it stops using more electricity than entire countries, for something Visa can do for comparatively nothing. I would hold the same opinion of any technology which used so much energy when there was a less wasteful alternative. I also happen to be skeptical of Bitcoin's long-term outlook, but that's not why I'm actively against it as a technology. If it wasn't for the planet, I'd…

Visa is no medium of exchange - only a payment network. CO2 emissions are bad for sure. CO2 tax would help with the migration to green energy. Energy consumption however also has a reason -> security. I don't think there is a secure alternative and I don't think anyone wants to continue staying in central banking hell.

> I don't think anyone wants to continue staying in central banking hell.

looks like cryptocurrency community's filter bubble

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

#447

Post by oraphalous »

tylerhou wrote: post #338
oraphalous wrote: post #326

Earlier quoted context omitted.

"The demand for USD is robust because people need USD to pay taxes..." You cite this a priori - but it's so much more complicated than this. Demand is intimately connected with supply in many cases. Soemtimes this can be because demand is latent. If production of food goes through the roof - and people were previously starving because the price of food was too high, then that latent demand will be released when suppl…

Citing "latent demand" or "induced demand" as counter-evidence to my original statement shows your (mis)understanding of basic economics. In fact, basic economics predicts "latent demand" for ordinary goods! > But currency is different - opposite even. If supply goes through the roof - then demand will respond inversely. This is terrible reasoning. It depends on why that supply is going through the roof. Maybe the su…

>Citing "latent demand" or "induced demand" as counter-evidence to my original statement shows your (mis)understanding of basic economics.

Your original statement:

>The demand for USD is robust because people need USD to pay taxes and to purchase most goods

...remains an absurdly simplistic explanation of USD demand. I wasn't citing latent demand as a counter example to this explanation - just an illustration of easy to intuit scenario where demand responds dynamically to supply so that folks can see it happening in another context besides currency.

Clearly I was not referring to latent demand in my actual counter-example - which you even seem to acknowledge later...

> This is terrible reasoning. It depends on why that supply is going through the roof.

I don't disagree. And at least one scenario where USD demand has skyrocketed has been because of its safe haven reserve status... which again speaks to how simplistic your original claim about the robustness of USD demand actually is... and lo - suddenly we have another vector of possible future weakness of USD demand that Bitcoin folk can consider. A vector, mind you, that was completely elided by that simplistic explanation of demand that I contested.

Which is all I really want to achieve here... to remove this veil of simplicity - folks like you repeat ad nauseam these one line, simplistic claims about why Bitcoin demand must be illusory or idiotic... "Because you can't pay taxes with it! Hurrumph!".

But no - there is considerably more complexity and nuance to all this - as you yourself are admitting in your response. That all I wanted / needed to do to demonstrate the obfuscatory contribution to the discussion of your original comment.

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

#448

Post by ahnick »

sytelus wrote: post #258
RestlessMind wrote: post #179

Earlier quoted context omitted.

It is rather a promise of an "eventual stability". Thinking through that lens, I think USD (and other Fiat currencies) are the ones exhibiting instability.

BTC cannot be stable, even eventually. There is no way to increase the BTC supply so when productivity increases, prices of goods (expressed in BTC) will always go up. Assume that BTC is the only currency and world productivity goes up 6% each year, or 0.5% each month. Then when you go in store to buy apple, you will see price gone up by 0.5% than previous month because there is no way to increase money supply. One o…

If BTC is the only currency and everyone is transacting in BTC, then people are incentivized to hold BTC. Now that everyone is holding BTC, the value of their holdings are increasing alongside everyone else holding BTC. If you go into the store to buy items you will notice that the price in BTC terms will be decreasing b/c more BTC can't be "printed". (Each BTC is worth a lot now and continually increasing, but at a predictable rate) Each person will continue to pay with less and less BTC over time all the way until the lower unit bound, which is a satoshi (0.00000001 BTC), is reached. If we ever reach that point in our lifetime the code will need to be forked to upgrade the protocol to handle further subdivisions.

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

#449

Post by the_gastropod »

guiomie wrote: post #293
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…

When I read a message like this, I conclude that bitcoin has another 10x to go since gold has a 10 trillion market cap. (Preemptively I'm going to say that gold market cap has almost nothing to do with its usage as a commodity, google it) reply

And the GDP of New Zealand will go up 100x because the USA has a $21T GDP. (Preemtively I’m going to say that US’s market cap has almost nothing to do with its sheep population, google it.)
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