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The Handwavy Technobabble Nothingburger of Crypto

stephendiehl.com

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Re: The Handwavy Technobabble Nothingburger of Crypto

#421

Post by actually_a_dog »

wayoutthere wrote: post #367
AnimalMuppet wrote: post #305

Earlier quoted context omitted.

Wait, you can't legally buy stocks with cash? Why not?

KYC laws aimed at anti-money laundering; any large movement of money has to be between trusted parties. Which means a verification process that is more thorough the more money you move around.

Right, but that just means some paperwork gets filed when you attempt to do large transactions with cash, not that it's literally illegal to do those transactions. I don't understand why the toplevel comment says it's illegal to buy stocks. It seems like it would be merely very difficult, not illegal. I think your biggest problem would be finding a broker that would accept a pile of cash to buy you stocks with, rather than the fact that the transaction needs to be reported to the government.

Re: The Handwavy Technobabble Nothingburger of Crypto

#422

Post by sbierwagen »

HWR_14 wrote: post #416
andrewla wrote: post #103

If anything, I think stablecoins are way more dangerous than the author indicates. People talk about things like Bitcoin as a threat to sovereign currencies, and they are, as competitors, of sorts. But stablecoins are another matter entirely. One huge aspect of the value of sovereign currencies is that they are instruments of law -- courts will settle in them as a lowest common denominator, and it is safe to use them…

> That means that if banks (which are businesses) are not good at doing business, the government is essentially forced to treat them as dollar-equivalents by making them whol The federal government also charges the banks for that insurance. It usually is not a loss for the government.

The federal government prints dollars. It is never going to take a loss doing that.

Re: The Handwavy Technobabble Nothingburger of Crypto

#423

Post by nice_byte »

pennaMan wrote: post #405

Crypto is all about decentralized proof of trust yet somehow this eludes people who should know better. Please show me how you solve decentralized proof of trust (double spend) with postgres. Indeed, crime did have a need for anonymous proof of trust that crypto solved. Why did crime have a need for that? Because crime lies beyond the realm of the status quo. Criminals are to the status quo as pioneers and revolution…

you mean what payment systems and any online game with in-game currency have solved?

Re: The Handwavy Technobabble Nothingburger of Crypto

#424

Post by actually_a_dog »

JuliusBranson wrote: post #357
dragonwriter wrote: post #304

Earlier quoted context omitted.

> When there's stablecoin, you just put your dollar in stablecoin before they print the money, the dollar inflates, stablecoin goes up proportionately, Printing fiat makes stablecoins denominated in the currency lose real value, not gain in it. (Stablecoins denominated in a different currency would gain nominal value in the printed currency, the same way direct holdings in the alternative currency would.) So, no, to…

>Printing fiat makes stablecoins denominated in the currency lose real value, not gain in it. What's the case for this statement? In general, I don't expect to commodities to change value just because some currency was redistributed.

The commodity in this case is just a proxy for USD or other currency.

Re: The Handwavy Technobabble Nothingburger of Crypto

#425

Post by sjtindell »

Imnimo wrote: post #407
sjtindell wrote: post #354

Earlier quoted context omitted.

HN’s attitude is very surprising to me. I would think that they could get very excited about flash loans, decentralized exchanges (automated market makers), daos, and other concrete innovations coming out of crypto asset projects. I think it’s mostly jealousy and a feeling that they missed the boat, so they want to see it sink. I think that because I’ve had the feeling many times. They may not realize these are early…

>go read the UniswapV2 contract. If you don’t think that’s a cool innovation, please come back and let me know, I’m interested. I feel like the coolness of Uniswap requires putting the cart before the horse. If I'm not convinced of the real utility of these tokens, why would I be impressed with the ability to move them around in various clever ways? I need to see a valuable external use case before I can see the valu…

I guess to me it’s more about progression. From Bitcoin, to Ethereum, to Uniswap, there is a strong development of the early ideas and technology. This doesn’t seem like it will just stop to me. It indicates a very bright future in my opinion. Also, although I get disillusioned, I personally have come to appreciate more that the value being produced is financial. There is clearly massive pent up demand for financial games. On Wall Street there is a huge market for firms that proudly do not pay attention at all to the underlying assets they trade in a “fundamentals” sense, and just play games with mathematical and technological advantage. From what I can tell massive segments of finance are just money games. This is a form of that, which is a real and tremendous market. A natural progression that people who say “high frequency trading provides no value” or “banks shouldn’t be allowed to deal in derivatives” will hate.

You should hear the kind of stuff people are coming up with…what if I could sell a token, and the interest generated from staking it gets repackaged into an options contract on another chain that then gets its value automatically updated every time someone sells and…

It seems nonsensical, until you go learn what all these quants are getting paid millions per year to do for hedge funds and you think to yourself “oh, it’s a similar thing. There is demand for this.”

Re: The Handwavy Technobabble Nothingburger of Crypto

#426

Post by verdverm »

pennaMan wrote: post #405

Crypto is all about decentralized proof of trust yet somehow this eludes people who should know better. Please show me how you solve decentralized proof of trust (double spend) with postgres. Indeed, crime did have a need for anonymous proof of trust that crypto solved. Why did crime have a need for that? Because crime lies beyond the realm of the status quo. Criminals are to the status quo as pioneers and revolution…

It's understood, but not desirable. Proof of Authority is preferable. Double spend is somewhat separate from proof of trust one you change the consensus algo and make it a permissioned system.

Re: The Handwavy Technobabble Nothingburger of Crypto

#427

Post by cdiddy2 »

outside1234 wrote: post #346
rawtxapp wrote: post #336

Earlier quoted context omitted.

Are you implying that no rational person should ever buy Bitcoin? That seems a bit far-fetched, no? At this point, considering that it's stronger than ever and it's pretty clear it's not going away, I would expect a rational person to allocate even a small percentage to it for diversification, in case they happen to be wrong on their conclusions or understanding of Bitcoin.

There are rational reasons for buying Bitcoin - most of them revolve around money laundering, drug trades, and ransomware. This is the reason we should enforce "know your customer" laws on Bitcoin such that we have government ID for everyone for every transaction that hits the chain.

Tell that to the people in Turkey who had there currency fall 10% against the dollar just this week. Tell that to Argentinians, or Nigerians, or Afghanistan.

You might be surprised by the places where crypto has the most penetration. https://bitcoinist.com/cryptocurrency-adoption-highest-5-cou...

Re: The Handwavy Technobabble Nothingburger of Crypto

#428

Post by koonsolo »

bildung wrote: post #177
rawtxapp wrote: post #107

Earlier quoted context omitted.

Once you accept that the future is unknown, you'll see that every asset is a speculative asset, no? For the longest time, real estate was assumed to be 100% safe until 2008, etc.

The difference between investment and speculation is pretty established, isn't it? For example https://www.investopedia.com/ask/answers/09/difference-betwe...

According to that definition, I am investing in cryptocurrencies.

Re: The Handwavy Technobabble Nothingburger of Crypto

#429

Post by AlexandrB »

wyager wrote: post #411
louwrentius wrote: post #312

Earlier quoted context omitted.

We are perfectly capable to decide what is better because it isn't magic. For every gain, somebody literally has to lose. All crypto money is just other people's money. The people who win are vocal. The people who lose, stay silent, often in shame And even if you disagree, those gains are not worth the destruction of our planet.

The people losing money to bitcoin are bagholders in inferior monetized assets like USD, real estate, etc. It's still a net gain for society though - introducing good hard money is extremely positive-sum.

If a particularly powerful solar flare knocks out the internet for a couple of weeks my real estate investment will still keep me housed. Your bitcoin asset will do... what? Even USD (at least in physical form) is more useful in a crisis. I can put it in my pocket and trade it with the guy down the street for food/water (under the assumption that the government won't collapse). The amount of high-tech, fragile infrastructure bitcoin needs to function correctly is astounding. The entire idea of bitcoin being superior to traditional currencies depends on the idea that nothing really bad will ever happen again.

Re: The Handwavy Technobabble Nothingburger of Crypto

#430

Post by Animats »

What's so striking about all this is the sheer scale. There have been bubbles before, but not trillion dollar ones based on nothing.

It's not just Bitcoin and friends. Rivian, which is just starting out as an electric light truck manufacturer, has a market cap of US$98 billion. First vehicles will ship no sooner than January 2022. This is more market cap than Ford Motor, the #1 seller of light trucks for the last 44 years and with a good electric truck in their lineup.

This can't end well.

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