New study detects lottery-like behavior in cryptocurrency markets • Hacker News Board

Re: New study detects lottery-like behavior in cryptocurrency markets

#71

Post by bob33212 » Thu, Apr 01, 2021, 6:57 PM UTC

undefined1 wrote: post #5

how does it compare to the gambling of stocks on Robinhood?

Stocks can have cashflow. It is possible that GME will come up with a new business plan that makes money. Maybe unlikely, but it is something you can make a bet on. BTC is more like a lottery. You don't know what day will be the peak price. So you buy your BTC sell to someone else and hope you guess the top. BTC will never turn a profit, all you can do is hope that you sell before it crashes.

Similarly a lottery ticket will never produce dividends or cashflow. You pick a number and hope it is the lucky one.

Re: New study detects lottery-like behavior in cryptocurrency markets

#72

Post by airstrike » Thu, Apr 01, 2021, 6:59 PM UTC

cmehdy wrote: post #48

henvic wrote: post #9

It's trivial. Just say any is pure speculation of thin air and you'll be right. There's no sense in the currently existing crypto currencies. They're all fiat money. Peter Schiff was right back then... https://www.youtube.com/watch?v=sgRGBNekFIw and he's still right now. https://twitter.com/peterschiff/status/1345427870546538509

I always feel like a fish out of the water when talking about money-related subjects, so I looked up what the actual definition of fiat money is, and followed a dozen or so different sources. Unless I am mistaken, it seems like cryptocurrencies that currently exist can all be called fiduciary money but not fiat money, as the fiat term seems to tightly connect with government decrees and issuing. There might be a form…

Fiat money is most commonly used to refer to money not convertible into any real asset, as opposed to e.g. being coupled to gold. It exists simply because the government wishes it into existence, hence "fiat" or "make it so" in a very liberal translation from Latin

Re: New study detects lottery-like behavior in cryptocurrency markets

#73

Post by [deleted] » Thu, Apr 01, 2021, 6:59 PM UTC

endisneigh wrote: post #27

It makes sense. In my experience the primary goal for most crypto holders is to be a part of a new elite. This is why the most popular currencies have a fixed supply. That way, if they're popular earlier adopters get to be a part of the elite. With such a premise it makes sense to treat crypto like the lottery as the gain/loss likelihood is very similar to say, Mega Millions. I do see value in a crypto that's pinned…

[deleted]

Re: New study detects lottery-like behavior in cryptocurrency markets

#74

Post by airstrike » Thu, Apr 01, 2021, 7:00 PM UTC

henvic wrote: post #9

It's trivial. Just say any is pure speculation of thin air and you'll be right. There's no sense in the currently existing crypto currencies. They're all fiat money. Peter Schiff was right back then... https://www.youtube.com/watch?v=sgRGBNekFIw and he's still right now. https://twitter.com/peterschiff/status/1345427870546538509

> They're all fiat money.

This has no bearing on the (societal) value of bitcoin. The dollar is also fiat money and everyone loves it.

Re: New study detects lottery-like behavior in cryptocurrency markets

#75

Post by qeternity » Thu, Apr 01, 2021, 7:00 PM UTC

rodiger wrote: post #12

qeternity wrote: post #10

Earlier quoted context omitted.

That’s because all of those things are predominantly traded due to their underlying utility. Like lotteries, which have no utility other than taxes and speculation, crypto currencies are almost entirely valuable as tools for speculation.

What? Plenty of crypto projects have real utility. Also for a counterpoint: commodities such as gold and other precious metals are predominantly traded as speculative vehicles.

Ok, I’ll play along. Which projects are those?

Re: New study detects lottery-like behavior in cryptocurrency markets

#76

Post by cool_dude85 » Thu, Apr 01, 2021, 7:01 PM UTC

kneel wrote: post #70

vkou wrote: post #66

Earlier quoted context omitted.

What makes you so eager to live in a deflationary money system?

I'd prefer to live in a hybrid system where I can allocate what I need, where I need, when I want. There is a very good argument for fiat as well as a good argument for crypto.

You want to be able to put some of your money in a less-liquid form, hoping to earn some return? Have I got good news for you about the past thousand years or so.

Re: New study detects lottery-like behavior in cryptocurrency markets

#77

Post by tshaddox » Thu, Apr 01, 2021, 7:01 PM UTC

endisneigh wrote: post #27

It makes sense. In my experience the primary goal for most crypto holders is to be a part of a new elite. This is why the most popular currencies have a fixed supply. That way, if they're popular earlier adopters get to be a part of the elite. With such a premise it makes sense to treat crypto like the lottery as the gain/loss likelihood is very similar to say, Mega Millions. I do see value in a crypto that's pinned…

> In my experience the primary goal for most crypto holders is to be a part of a new elite.

This part doesn’t sound very different from investing in startups, where everyone is hoping to get in really early on the next unicorn. Seems to me the main difference is that this kind of “investment” is generally only available to people who are already “elite” in some sense (i.e. sufficiently wealthy and/or connected).

Re: New study detects lottery-like behavior in cryptocurrency markets

#78

Post by ayngg » Thu, Apr 01, 2021, 7:02 PM UTC

whoisjuan wrote: post #20

Of course. Anyone who claims to understand cryptocurrencies pretty well is lying. I consider myself an intelligent person. Maybe I'm not, but I try to take informed decisions and stay up to date with the latest technology developments. Even with this, I have a very mediocre understanding of cryptocurrencies. I do understand well how a blockchain works, but I would be lying if I said that I understand well the economi…

My take on it is basically nobody knows what it is about. Like you said, even people with deep understandings of the technology probably aren't capable of fully understanding its implications, anyone that tries to tell you definitively is speculating. It is like "satoshi" made a sandbox and everyone else has been spending the past decade either trying to figure it out, or dismissing it as a scam.

It's a gold rush in the wild west, it starts off very inefficient, actual scams abound and crazy speculation is everywhere, like a gold rush at the end of the day there is probably something with value under all the craziness, that is what happens when things are new and people don't understand it, they are the ones that are establishing the parameters of its function, what it can and cant do. It seems like all mainstream blockchain related discussion is basically people circle jerking about how it is 100000% a scam or how it is the new paradigm with no space in between, which is pretty disappointing.

Re: New study detects lottery-like behavior in cryptocurrency markets

#79

Post by me551ah » Thu, Apr 01, 2021, 7:02 PM UTC

endisneigh wrote: post #27

It makes sense. In my experience the primary goal for most crypto holders is to be a part of a new elite. This is why the most popular currencies have a fixed supply. That way, if they're popular earlier adopters get to be a part of the elite. With such a premise it makes sense to treat crypto like the lottery as the gain/loss likelihood is very similar to say, Mega Millions. I do see value in a crypto that's pinned…

I don't think governments are going to just sit and watch as they lose control of their currency. Governments need to have the ability to provide a stimulus package if necessary. If something blocks them from doing it, they will just ban it.

Re: New study detects lottery-like behavior in cryptocurrency markets

#80

Post by PragmaticPulp » Thu, Apr 01, 2021, 7:03 PM UTC

therein wrote: post #45

endisneigh wrote: post #27

It makes sense. In my experience the primary goal for most crypto holders is to be a part of a new elite. This is why the most popular currencies have a fixed supply. That way, if they're popular earlier adopters get to be a part of the elite. With such a premise it makes sense to treat crypto like the lottery as the gain/loss likelihood is very similar to say, Mega Millions. I do see value in a crypto that's pinned…

> My biggest concern is a fixed-supply currency gives no government the ability to provide stimulus if necessary. Good, that's the intention.

Ironically, the cryptocurrency world as a whole is constantly increasing the supply of cryptocurrency and crypto assets. The ultimate supply of Bitcoin and other coins might be fixed, but we’re seeing new cryptocurrencies rolled out all the time. The number of altcoins on the market is staggering and it has never been easier for someone to arbitrarily create their own coin.

It’s not uncommon for popular cryptocurrencies to fork, doubling their supply overnight in absolute terms. One usually prevails, but several popular forks continue to chug along.

Now we’ve even moved on to minting arbitrary NFT tokens of things to continue increasing the supply of crypto assets.

If you look past singular cryptocurrencies, the entire cryptosphere has become a money printer.