391–400 of 421 posts
The first thing that will happen is that everyone phones up El Salvador and asks if they really want to be cut off from the entire rest of the world's financial system. Marshall Islands found this out too. I wrote it up yesterday: https://davidgerard.co.uk/blockchain/2021/06/04/the-marshall...
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USD has this little problem and it hasn’t even begun to manifest yet. https://fred.stlouisfed.org/series/M1SL
No, that graph only shows a discontinuity because the definition of M1 money supply was changed on that date. They explained it fully here: https://fredblog.stlouisfed.org/2021/01/whats-behind-the-rec... Sharing the graph without the context is misleading.
https://seekingalpha.com/article/4396194-why-m1-money-supply...
From your own link we can see-
“In late February and early March of 2020, the Fed cut its policy interest rate dramatically to help ease credit conditions during the COVID-19 crisis. The resulting acceleration in the supply of M1 can be understood largely as banks accommodating an increase in people's demand for money.”
This is “real” money that banks needed access to for their customers in unprecedented amounts. The problem is that it was created out of nothing.
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The payment system mentioned in the Fine Article is built on top of Bitcoin, using Lightning Network. There's nothing stopping them from putting various consumer protections and rewards programs on top of that, and plenty of motive to do so. It's definitely a wait-and-see sort of thing, but I don't see as to how betting against it is the obvious move.
Why does the Strike app use LN or crypto at all? I just can't wrap my head around this. They're a custodial wallet for your fiat currency, right? You deposit fiat with them. You withdraw fiat from them. You move it between accounts on their service. They, or a designed entity must hold that fiat on deposit on behalf of users. When you 'send' that money (according to Jack Maller), they buy BTC for you, send it over th…
The creator of Strike is a true believer. You can model this in religious terms if that helps.
He believes, intellectually and emotionally, that Bitcoin is better than fiat. That it's sound money, uncensorable, uninflatable, distributed, and that adopting it will make the world a better place.
From that perspective, the collapse of the fiat system is an inevitability. Something like Strike is an onramp; realizing the BTC as fiat on both sides is just a transitional technology, until the market cap of Bitcoin is sufficient to smooth out volatility and allow it to function as a unit of account.
It continues to baffle me that such a substantial fraction of HN users show less understanding of Bitcoin than my average nontechnical friend. I don't mean agreeing with it, to be clear; I'm of at least two minds on the subject myself.
But it doesn't seem to be going away, and at some point understanding how the cult thinks is going to come in handy. I'm not a Mormon but I do know enough about their history and theology to carry on a conversation.
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> Why is no one pointing out that, in order to receive bitcoins on the Lightning Network (LN), you need to lock bitcoins in a payment channel? I think lightning needs economy of scales in order to minimize the bitcoins "locked" perception, because once you can pay lots of your needs with lightning then those bitcoins are not "locked" anymore. Though that's assuming consumers run lightning nodes too, which need to be…
> I think lightning needs economy of scales in order to minimize the bitcoins "locked" perception, because once you can pay lots of your needs with lightning then those bitcoins are not "locked" anymore. What do you base this assumption on? Once there’s a gateway between a consumer and a merchant, then sending e.g. 0.001 BTC from the consumer to the merchant happens by the consumer sending it to the gateway in one pa…
But LN is more productive in an interconnected economy
Let me take your own example to the extreme case and let's assume every entity in the world has a channel opened to only one gateway.
e e e
\ | /
gateway
/ | \
e e e
I think a more decentralized topology, where most entities are gateways too, will have less bitcoins "locked", but I don't know by how much, 30% less?, 70%?, 95%?, I'm not sure, but I think it's probably better than last scenario.
Nevertheless, no matter how good the LN gets, its inevitable that some bitcoins will indeed get locked, when any gateway spends all of its bitcoins then everybody else connected to that gateway cannot route payments through it, and unless they intend to pay directly to the "bankrupted" gateway, those bitcoins are indeed locked.
I think no matter the scenario, LN reduces the need to transact onchain, and the better interconnected the economy is with the LN, more effective it is at doing so. So I think a better metric to follow is the #-of-onchain-bytes that were saved thanks to the LN
Another thing to point out is that we are talking about the LN that is deployed today, we haven't taken into account future improvements that might come, like multiparty channels.
I think the serious technical problems that the LN really has today, is that it's not that robust for gateways, I've heard it has DoS weaknesses, and privacy issues, and I'm not sure how solvable some of them are if the topology becomes centralized with just a few gateways
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For the sake of argument, what's the absolute best alternative to Tether that you feel could safely be used as an example? Because you quickly resorted to ad hominem attacks even though you failed to provide any alternative or even a single counter example.
I don't know what the absolute best alternative is or how you would define the absolute best, I just know that there are several alternatives. The grandparent knows this as well, hence my post. [0] https://coinmarketcap.com/view/stablecoin/
It does not seem you're able to point out anything at all.
Is that because you are aware that there is actually no good argument to refute OP's point? And thus you resorted to name-calling?
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You have a wrong understanding of how LN works. You are conflating inbound and outbound liquidity. To receive 1 btc a merchant does not have to open a 1 btc channel. Another node has to open a channel with him. He can buy 1 btc of incoming liquidity for a few cents. Some nodes offer incoming liquidity for free (it costs them almost nothing to keep their btc in a channel for a while). And your super simple setup is co…
> He can buy 1 btc of incoming liquidity for a few cents. I’m very interested. Where can I buy this?
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You mean like... Tether?
There are several alternatives nowadays, you're being dishonest by only mentioning the most controversial one.
No. Your argument is "Yeah, we know it's terrible... so you can't hold it against us." Nevermind the fact that coinbase started to support Tether.
I think what's most interesting to me (and should be to you as a pro-crypto advocate) is that underlying backing in tether appears to be highly volatile, yet it's not represented in the price. Also what should be shocking is hodlers don't care about this either.
Nobody cared about Bernie Madoff as long as their accounts and the market kept going up. As soon as people tried to take their money out, however....
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Nah. When things are cheap, people will go shopping. When things are expensive, people will save. It's a naturally self-correcting mechanism. Every deviation from the expected deflation would be an opportunity for arbitrage. Also, the deflation isn't guaranteed, so it carries a risk, which disincentivizes hoarding.
There are always some things that are expensive and some that are cheap. It is not a binary mode for many people to be in one or the other.
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If fees are less than 1/10th of a cent, it means they make less than $1 for every 1000 transactions. So how many transactions are they processing? In 2019, ~5000 transactions per month [1], so the entire lightning network was generating less than $5 per month in revenue. Something doesn't add up. [1] https://www.opennode.com/blog/wp-content/uploads/2020/03/Ope...
It's up to the nodes how much they want to charge, which is a competitive thing. They might as well charge 1000x more, that's just the figure the market arrived at. So, why do they charge so little? Running Lightning could be done for other reasons than just collecting fees, similar to why you might run a full Bitcoin node, even though it only costs you money: You are invested in the network as a whole. It's also wor…