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Bitcoin has few attributes of money but all the attributes of a collectible

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Re: Bitcoin has few attributes of money but all the attributes of a collectible

#141

Post by matheusmoreira »

rawtxapp wrote: post #132
matheusmoreira wrote: post #122

Earlier quoted context omitted.

There's also Monero which is everything Bitcoin was supposed to be and much more. Why bother trying to fix bitcoin when a solution already exists? There's absolutely no need for this layer 2 stuff.

There are thousands of other cryptocurrencies that claim to have better tech than Bitcoin in terms of privacy, speed or fees. This is the case of having a better technology doesn't matter, Bitcoin came at a very lucky time and also grew organically for many years and had arguably the fairest coin distributions (most coins nowadays are shilled very heavily by it's developers and investors). It's also the most secure a…

> There are thousands of other cryptocurrencies that claim to have better tech than Bitcoin in terms of privacy, speed or fees.

Monero isn't just claiming this though. It actually delivers on its promises. It's actually private, authorities are having trouble tracing it. Criminals are already switching to Monero. Transactions are fast and the fees are low. It's mineable by ordinary CPUs, no centralized ASIC/GPU mining operations in China. Since mining is more decentralized, nobody opposes improvements to the Monero blockchain like the bitcoin and ethereum miners do.

> at least 10x better

Monero is pretty much infinitely better. If any coin is positioned to unseat bitcoin it's Monero. If there's any sanity left in this cryptocurrency market this will happen one day.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#142

Post by wolfretcrap »

rawtxapp wrote: post #132
matheusmoreira wrote: post #122

Earlier quoted context omitted.

There's also Monero which is everything Bitcoin was supposed to be and much more. Why bother trying to fix bitcoin when a solution already exists? There's absolutely no need for this layer 2 stuff.

There are thousands of other cryptocurrencies that claim to have better tech than Bitcoin in terms of privacy, speed or fees. This is the case of having a better technology doesn't matter, Bitcoin came at a very lucky time and also grew organically for many years and had arguably the fairest coin distributions (most coins nowadays are shilled very heavily by it's developers and investors). It's also the most secure a…

Fair coin distribution is easy to solve in new coins if all the bitcoin owners get equivalent proportion of the new coin and developers/founders get nothing. But how many are brave enough to create such coin?

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#143

Post by gonehome »

mrpopo wrote: post #129
gonehome wrote: post #63

Earlier quoted context omitted.

I’ve basically come to believe the argument described in the following is true: https://www.matthuang.com/bitcoin_for_the_open_minded_skepti... Bitcoin isn’t a cash competitor, it’s a gold competitor - and it’s a pretty good one. Part of something like gold is the shared social belief in it as a store of value. Bitcoin has this and there’s enough time and infrastructure behind it at this point that I’d bet it’s likel…

> Part of something like gold is the shared social belief in it as a store of value. Gold has inherent uses as a precious metal. Bitcoin mining only computes SHA256 hashes for no actual purposes.

It’s worth reading what I linked. Gold’s inherent utility as a metal is largely irrelevant.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#144

Post by wolfretcrap »

paxys wrote: post #133
chii wrote: post #67

Earlier quoted context omitted.

> If people would stop believing the myth imagine if tomorrow, we suddenly find ourselves mining gold from asteroids, and that gold suddenly became super-abundant. Would the price of gold drop to match just the material usage value (e.g., for jewellery and electronics)?

Yes. In the same way Bitcoin will be worthless if quantum computing or some yet undiscovered technology makes calculating hashes effortless.

But by then bitcoin would have started using quantum hashes.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#145

Post by lostmsu »

skohan wrote: post #74
DubiousPusher wrote: post #69

I don't know why there's an article that makes the rounds once a month analogizing bitcoin to some other thing when.. 1 bitcoin is its own thing 2 bitcoin has a clear analog in the form of gold Collectibles are a terrible analogy because 1 they are not fungable and bitcoin is 2 they are not easily converted into currency whereas bitcoin is 3 they carry novelty and bitcoin does not (cryptocurrency may carry some novel…

> bitcoin does not have the track record that gold does. That's a heck of an understatement - Gold's track record dates back essentially to the beginning of civilization or earlier.

I would argue, that the last 100 years had about the same amount of human history as millions years before them.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#146

Post by fomine3 »

matheusmoreira wrote: post #141
rawtxapp wrote: post #132

Earlier quoted context omitted.

There are thousands of other cryptocurrencies that claim to have better tech than Bitcoin in terms of privacy, speed or fees. This is the case of having a better technology doesn't matter, Bitcoin came at a very lucky time and also grew organically for many years and had arguably the fairest coin distributions (most coins nowadays are shilled very heavily by it's developers and investors). It's also the most secure a…

> There are thousands of other cryptocurrencies that claim to have better tech than Bitcoin in terms of privacy, speed or fees. Monero isn't just claiming this though. It actually delivers on its promises. It's actually private, authorities are having trouble tracing it. Criminals are already switching to Monero. Transactions are fast and the fees are low. It's mineable by ordinary CPUs, no centralized ASIC/GPU minin…

Monero is pretty much infinitely better, that's why gov hates it.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#147

Post by rspeele »

cyphertruck wrote: post #96
mrpopo wrote: post #81

Earlier quoted context omitted.

> I understand, certain people really hate bitcoin— and fir good reason. Bitcoin will eventually obsolete the fiat inflation system which has created all the wealth inequality in much of the world. The system that lets politicians buy power and escape responsibility for violating rights. What part of Bitcoin abolishes corruption, power-grabbing and bribes? How would it fix anything you accuse the current system of? A…

When you cannot rob from the poor via inflation then it becomes harder to oppress them. The Great Depression was caused by the government making gold illegal, effectively confiscating the nations wealth and replacing it with massive fiat inflation. It was a period of monetary inflation that caused and economic contraction. One if the ways inflation is used to indoctrinate people against their best interests is demoni…

It's not quite universal to say inflation robs from the poor. Some poor people like your fixed-income grandma example are hit hard by inflation. Some are hardly affected since they live paycheck to paycheck and don't keep savings. Others benefit from it -- in particular, those who have more debt than savings. Inflation is good for debtors and bad for creditors.

Anyway, I'm hardly opposed to keeping inflation low. I would be fine with 0 inflation, for that matter. By 0 inflation, I don't mean a fixed money supply. I mean $X pays for about the same amount of goods 10 years from now as it does today.

Accepting limitless deflation via a fixed monetary supply is just as absurd as accepting limitless inflation.

It does not make sense to base a monetary system on a token that represents "1/k of all the wealth", where k is a constant. So just by stuffing the token under your mattress, contributing to zero economic activity, you reap the rewards of all economic growth that added wealth to the world.

Here's how I see it:

The US M2 money supply grew from $286B in 1959 to $19,670B in 2021.

With that came inflation: a dollar in 1959 could buy roughly what $9.13 buys today, according to the BLS.

But that level of inflation is not even close to 1:1 with the money supply increase.

The money supply grew to almost 69x its 1959 size, but the dollar is worth 1/9th what it used to be, not 1/69th. That's because the whole pile of dollars put together are representing more real world wealth than existed back then. The economy has grown, more people are participating in it, and it's making more stuff people value.

Maybe the correct level of growth in the money supply would've been 9x smaller, for no inflation. So the dollar today would buy roughly what it did back in 1959. I suppose that would be OK. But that's still a money supply increase from $286B to $2,193B.

What if the money supply was fixed? So instead of roughly 9.1x inflation, we'd have roughly 7.7x deflation: the dollar today would buy 7.7x the stuff it bought back in 1959. How is that fair? Grandpa's pay for a day's work back in '59, which he put in a safe and forgot about, is worth what I get for a week and a half of work in 2021? Talk about oppressing the poor, you're never going to beat "old money" in this system. The longer the family has been wealthy the more unattainable their savings will be in terms of present-day wages and earnings.

And that's all assuming the best case scenario, which is that the 7.7x economic growth still happens with this deflationary currency. I could easily see it being lower given that there's less incentive for anybody to invest in businesses.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#148

Post by gajotron »

beambot wrote: post #125
fny wrote: post #52

Earlier quoted context omitted.

Here's a question: how many people do you know that buy crypto intend to spend it? You know, use it like currency? Or are they all just HODLing in the hopes that some other buyer will come along who believes it will become a medium of exchange? In my view, it's not a currency until people stop speculating and start using it like a currency. So yes, it's a collectible with ridiculously high transaction costs that make…

Most people I know keep less than 3 months of their net worth in currency. The vast majority of their net worth is placed in real estate (largely, their primary residence), stocks, or ETFs. You can make a case about net-present value of future dividends, but the S&P dividend yield is 1.4% -- i.e. less than inflation. So quite literally, every asset they have as a store of wealth is "just HODLing in the hopes that som…

In terms of numbers, your logic is slightly off because of the distortions of tax law, which means in fact, the bulk of the S&P's distributions in any given year are often buybacks. It makes the net yield of the S&P500 closer to 5% over the last decade: https://www.yardeni.com/pub/buybackdiv.pdf

People rationally buy 5% perpetual yields to cream the asset, not HODLing in the hopes some other buyer will come.

Absolutely I would make a case about the net present value of future distributions - the clearing IRR is currently around 4%, having been around 5% last year.

Similarly real estate pays rent or owners equivalent rent (the value the owner derives from living in it rather than paying market rents). Here, the market seems to clear around 2-3% net of maintenance, having previously cleared around 6% when interest rates were higher.

Bonds pay interest, albeit at this time the clearing yield level is very very low.

What is the clearing yield of bitcoin? Undefined, because it has no expected future intrinsic cashflow payable to the owner.

Bitcoin hodlers have only one possible way to collect a future cashflow, sale to another person for either fiat or goods/services.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#149

Post by BelenusMordred »

matheusmoreira wrote: post #122
rawtxapp wrote: post #64

Earlier quoted context omitted.

I feel like beating a dead horse, but there's tons of L2 technologies at this point, lightning payment channels or rollups on eth, etc. The blockchain itself is like a settlement layer. Our current financial system is also layered similarly btw. When you buy something with your credit card, it doesn't settle right away.

There's also Monero which is everything Bitcoin was supposed to be and much more. Why bother trying to fix bitcoin when a solution already exists? There's absolutely no need for this layer 2 stuff.

> There's absolutely no need for this layer 2 stuff

If XMR usage got big enough it would very much need layer 2 even more, the developers themselves acknowledge this and are upfront about it. These very basic computing problems that have been repeated ad nauseam for a decade now do not magically go away and are actually a lot worse for monero due to ring transactions being much heavier.

Are you really going to store a 2 TB blockchain that needs days of compute to initially confirm so you can transact with your friends privately? The first layer has insane amounts of PoW security baked in at this point, it's not for general consumption anymore.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#150

Post by n4r9 »

beambot wrote: post #125
fny wrote: post #52

Earlier quoted context omitted.

Here's a question: how many people do you know that buy crypto intend to spend it? You know, use it like currency? Or are they all just HODLing in the hopes that some other buyer will come along who believes it will become a medium of exchange? In my view, it's not a currency until people stop speculating and start using it like a currency. So yes, it's a collectible with ridiculously high transaction costs that make…

Most people I know keep less than 3 months of their net worth in currency. The vast majority of their net worth is placed in real estate (largely, their primary residence), stocks, or ETFs. You can make a case about net-present value of future dividends, but the S&P dividend yield is 1.4% -- i.e. less than inflation. So quite literally, every asset they have as a store of wealth is "just HODLing in the hopes that som…

I guess one difference is that real estate and stocks are more functional. With real estate you're providing a service for yourself or someone else. With stocks you're giving a company to continue business.
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