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Ask HN: Why crypto is rising so fast when its not creating value?

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Re: Ask HN: Why crypto is rising so fast when its not creating value?

#91

Post by DennisP »

GamblersFallacy wrote: post #84
moepstar wrote: post #78

Earlier quoted context omitted.

Actually, it's way more than 6000.. CoinMarketCap lists 13684, Coingecko lists 10394 - which probably includes a truckload of BSC "shitcoins", getting more by the minute...

Actually, its way more than 10394. Uniswap v2 factory contract returns 55,319 trading pairs. On the etherscan readContract page for the uniswap factory, the allPairsLength method returns index size. https://etherscan.io/address/0x5c69bee701ef814a2b6a3edd4b165...

But that's pairs, not individual assets.

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#92

Post by DennisP »

ben-schaaf wrote: post #50
mfrager wrote: post #11

Because it's clear from anybody who knows the details about it that crypto is the basis for the next-generation of the financial system.

As someone who spent some time working on Etherium data analysis, having to learn the details of how it all works, I don't see it ever becoming a large part of finance.

I've worked in the Ethereum space. What specifically is your objection?

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#93

Post by tata71 »

mohanmcgeek wrote: post #79
swalsh wrote: post #7

I think Crypto is a bunch of things to a bunch of people. Some see it as a fun way to make a quick buck, some see it as an alternative to gold in a time with unusual inflation of the dollar. I see it as the future of the web. There's a lot of energy coming around the concept of Decentralized Apps. or Web 3.0, today we have web 2.0 with large centralized websites ran by huge tech monopolies. Regardless of your politic…

Even if we assume cryptocurrencies have some role to play in the future dWeb, wouldn't that be the new currencies created by those dWeb services and not these ones being hyped right now?

Statistically all of new tokens are Ethereum tokens.

Could just buy & ride ETH to the end.

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#94

Post by tata71 »

rvz wrote: post #58
jazzyjackson wrote: post #43

Earlier quoted context omitted.

A distributed namespace system is pretty cool ( https://ens.domains/ )

Good idea, however it's a shame that this is sitting on a very inefficient blockchain, its TLD already collides with Ethiopia and to renew requires paying for the highly expensive gas fees which isn't great if you own multiple subdomains. The subdomains on ENS (which are all sitting on the .eth TLD) are also going to be in good hands; surely. /s

zxkrollup

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#95

Post by supermatt »

thoughtstheseus wrote: post #21
SubiculumCode wrote: post #18

Earlier quoted context omitted.

hyperinflation is hyperbole. Our inflation: 5% since last year. Hyper inflation: ~50% per month https://www.investopedia.com/terms/h/hyperinflation.asp

The S&P 500 returned > 30% over the last year. Inflation shows up in many places.

Inflation refers to the price of goods/services. Stocks are neither.

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#96

Post by JohnFen »

mdorazio wrote: post #75
SquishyPanda23 wrote: post #31

Earlier quoted context omitted.

> If people are willing to pay money for a service, that service is by definition valuable. This is only true if you define "value" to mean "people are willing to pay money for it." But that's a useless and circular definition. It's only tolerated because assuming that money is a proxy for value was useful for making crude models in economics.

You're welcome to provide a better definition.

"Value" is providing a benefit that is greater than the cost.

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#97

Post by spicyusername »

- Excessive Liquidity: There's money sloshing around the global economy looking for a place to go.

- Crypto Marketability: It's become very easy for people to buy and sell cryptocurrency.

- Speculation: Regardless of what problems cryptocurrencies pretend to solve, their actual value so far has only been as a speculative investment. Like traditional equities, cryptocurrency is benefiting from the highly speculative market we live in right now and the FOMO of investors trying to make a quick return.

The situation that you're seeing with cryptocurrency has historical precedent with investment bubbles involving other technologies that were perceived to be "world changing". The bicycle mania [1] of the late 19th century and the dotcom bubble [2] of the late 20th century being notable examples.

1: https://www.nasdaq.com/articles/revisiting-the-great-british...

2: https://en.m.wikipedia.org/wiki/Dot-com_bubble

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#98

Post by JohnFen »

DennisP wrote: post #89
philosopher1234 wrote: post #36

Earlier quoted context omitted.

“People will pay money for it” is not a useful definition of value. People pay money for assassination or vengeance and many extremely destructive things. What use is there in labeling these things as valuable?

In economics, value is purely subjective. If someone is willing to pay for it, then it has value to that person. To answer OP's simple question of why crypto has a high price, the economic definition is what you need. You're looking at a more absolute definition of value that has little to do with the price of things. That's a worthwhile discussion as well but has little to do with OP's question.

> If someone is willing to pay for it, then it has value to that person.

My problem with that definition is that it's a tautology, and therefore holds little actual meaning and provides no insight.

"Why is that valuable?" is not a question meaningfully answered by "because people want it". That answer only begs the question. Everything that has value to people only has value because people want it.

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#99

Post by JohnFen »

DennisP wrote: post #90
mohanmcgeek wrote: post #81

Earlier quoted context omitted.

> the same thing as any other currency: popularity and consumer confidence Real money is backed by your obligation to pay taxes in that currency.. not popularity or confidence.

People manage to come up with mediums of exchange even in the absence of taxing governments.

When has there been a government that doesn't tax?

Re: Ask HN: Why crypto is rising so fast when its not creating value?

#100

Post by thoughtstheseus »

supermatt wrote: post #95
thoughtstheseus wrote: post #21

Earlier quoted context omitted.

The S&P 500 returned > 30% over the last year. Inflation shows up in many places.

Inflation refers to the price of goods/services. Stocks are neither.

Stocks represent the present value of future claims on consumption.
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