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Bitcoin is largely controlled by a small group of investors and miners

techspot.com

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Re: Bitcoin is largely controlled by a small group of investors and miners

#131

Post by hutzlibu »

nuerow wrote: post #94
McGuive7 wrote: post #91

Soooo. . . you're saying a tiny fraction of the population controls the vast majority of the resource? You mean just like every other major resource on the planet? :)

> Soooo. . . you're saying a tiny fraction of the population controls the vast majority of the resource? You mean just like every other major resource on the planet? :) I understand the need to try to dismiss this problem, specially from those who have a dog in the race, but the dream of having a magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer just falls out flat if…

"but the dream of having a magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer "

I never heard that claim from crypto supporters, only from critics.

Re: Bitcoin is largely controlled by a small group of investors and miners

#132

Post by tonfa »

jayd16 wrote: post #75
mechanical_bear wrote: post #69

Earlier quoted context omitted.

> This is just desperate whataboutism Wat

If you read further, the point is expanded on. Said another way, consider that we move to Bitcoin tomorrow, those billionaires would control 60% of Bitcoins instead. And as I said, its still not equivalent to the count of those controlling the exchange of money. Its simply a red herring to show a smaller number.

Billionaires are wealthy but usually don't hold cash assets (or much gold for that matter), currencies are irrelevant.

(In a BTC world they wouldn't hold much BTC either, if they do that'd be a pretty bad outcome since wealth would be moved to a none productive asset)

Re: Bitcoin is largely controlled by a small group of investors and miners

#133

Post by spiorf »

nuerow wrote: post #110
anonporridge wrote: post #108

Earlier quoted context omitted.

> magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer That's not what's exciting about bitcoin. What's exciting is that it is the first digital, global money that isn't protected by the proof of violence of the state. The US dollar is the world reserve currency because the United States is the best in the world at deploying destructive power, and the British and French…

> That's not what's exciting about bitcoin. What's exciting is that it is the first digital, global money that isn't protected by the proof of violence of the state. No, not really. At all. You're trying to make it sound like everyone is just an anarchist activist trying to fight the power, when in reality it's just people scrambling to make a quick buck. Let's be real and put it in perspective: do you feel that peop…

Motivation of participants is irrelevant. Bitcoin is working because its participants are greedy and behave as such.

Re: Bitcoin is largely controlled by a small group of investors and miners

#135

Post by halfdan »

delaaxe wrote: post #127
Hermel wrote: post #109

Earlier quoted context omitted.

The top 1000 investors hold 15% of the supply? That’s not “highly centralized” if you compare to the stock market. For Tesla, one single shareholder holds 17% of the whole company.

I'm sure Elon holds more than 17%?

He holds 16.98% to be precise.

Re: Bitcoin is largely controlled by a small group of investors and miners

#136

Post by po1nt »

2muchcoffeeman wrote: post #114
Hermel wrote: post #109

Earlier quoted context omitted.

The top 1000 investors hold 15% of the supply? That’s not “highly centralized” if you compare to the stock market. For Tesla, one single shareholder holds 17% of the whole company.

But isn’t the dream to have some distributed system that no one can control? As an outsider looking in and comparing to the perceived values, this is yet another reason crypto is not worth your attention.

I don't believe total decentralization is possible. Yet still this ratio is a little unsettling. This issue is not limited to bitcoin but all the cryptocurrencies. But I believe it's still better than to have single party control the whole currency.

Re: Bitcoin is largely controlled by a small group of investors and miners

#137

Post by ildon »

anonporridge wrote: post #108
nuerow wrote: post #94

Earlier quoted context omitted.

> Soooo. . . you're saying a tiny fraction of the population controls the vast majority of the resource? You mean just like every other major resource on the planet? :) I understand the need to try to dismiss this problem, specially from those who have a dog in the race, but the dream of having a magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer just falls out flat if…

> magical pseudo-currency that solves all problems and unexplainably makes everyone richer and richer That's not what's exciting about bitcoin. What's exciting is that it is the first digital, global money that isn't protected by the proof of violence of the state. The US dollar is the world reserve currency because the United States is the best in the world at deploying destructive power, and the British and French…

> The only thing it requires is that you have hash power and internet connectivity.

Your argument is a bit naive and this sentence I quoted is the one that shows the reason. Proof of Work is a energy intensive activity, not to mention the specialized tech it requires.

Access to energy today is more than ever a sign of the power (including military power) of a nation, so much that energy itself could be regarded as the ultimate currency [1]. Who has more energy is richer. In short that is because nations with abundance of energy enable all sort of activities. In nations in which energy is scarce, opportunities are constrained by the cost of energy.

Because energy in the world is still a relatively scarce resource, powerful nations control natural resources needed to produce energy in any way they can. The obvious example is oil, but also land itself can be seen as a means to produce energy: think of the space needed for solar.

So in the end when talking about Bitcoin we are back at square one. Even if it was the only currency of the world, it would still be controlled by those with more power.

In short: Bitcoin is governed by spending energy and CPU -> ability to produce energy and CPU -> control over means of production of energy and CPU -> international strength ensuring control over natural resources and IP.

[1] https://youtu.be/dcIQdlud88c

Re: Bitcoin is largely controlled by a small group of investors and miners

#138

Post by leonardp »

jonas21 wrote: post #25

The Techspot article is a summary of this Bloomberg piece: https://www.bloomberg.com/news/articles/2021-10-25/bitcoin-s... which is itself reporting on this paper from the NBER: https://www.nber.org/system/files/working_papers/w29396/w293...

There is a foundational theoretical text in materialist philosophy that predicts exactly this happening. It was written in 1867. When reading articles like this I sometimes feel like the only thing we can learn from history is that we do not learn from history.

Re: Bitcoin is largely controlled by a small group of investors and miners

#139

Post by nuerow »

spiorf wrote: post #133
nuerow wrote: post #110

Earlier quoted context omitted.

> That's not what's exciting about bitcoin. What's exciting is that it is the first digital, global money that isn't protected by the proof of violence of the state. No, not really. At all. You're trying to make it sound like everyone is just an anarchist activist trying to fight the power, when in reality it's just people scrambling to make a quick buck. Let's be real and put it in perspective: do you feel that peop…

Motivation of participants is irrelevant. Bitcoin is working because its participants are greedy and behave as such.

> Motivation of participants is irrelevant. Bitcoin is working because its participants are greedy and behave as such.

The key problem you're trying to glance over is the fact that not all participants have the same degree of influence or control.

A greedy participant who is in a position to manipulate the market to fit his goals is in an entirely different position than a greedy participant who is completely powerless and vulnerable to this manipulation.

Is it ok if someone participating in a Ponzi scheme is fleeced just because you accuse him of being greedy?

Re: Bitcoin is largely controlled by a small group of investors and miners

#140

Post by tenuousemphasis »

jayd16 wrote: post #22
ajkdhcb2 wrote: post #19

Users, miners and developers all have different powers and hold each other to account in an interesting way that few people understand so far, affecting what 'control' really means. It needs to be put in context with alternatives. Compared to the alternative of corrupt governments that have complete control to print money at will, I have no doubt that it is a extremely promising experiment. ASICs do seem to pervert s…

In what way do users have control over miners or developers? If the assumption is that corruption can overcome a democratic state, I never understood why its so crazy to suggest it can overcome developers or a mining cartel.

Users choose which software to run, so they can fire one set of developers by running software by different developers. The software they run determines which blocks they consider valid, and if enough people agree that miners' blocks are invalid, miners will have to accept their blocks have less value or change the way they produce blocks.
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