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$130B wiped off crypto markets in 24 hours

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Re: $130B wiped off crypto markets in 24 hours

#331

Post by wruza »

smaryjerry wrote: post #296
Demiurge wrote: post #265

Earlier quoted context omitted.

There is a logical difference between making a decision that some time is a right time to make a decision and making a decision that you don't have enough confidence in either decision.

Holding is not lack of confidence in a decision. Holding is exactly the same confidence as a buy. It’s always interest to see analysts recommendations go between sell, hold, and buy to me because like the one who initially posted, I believe a hold is the same as a buy. The effect on your return between a hold and a buy is the exact same for those dollars. It would be illogical to say you would hold a stock at a price…

Technically two other commenters here have a point, I think. It depends on your bankroll and investment strategies. But it's so personal that no one (especially random analysts who don't even know you exist) could really advise to HODL and make sense. That's a nitpick, though insightful one, to be fair. But in in-vacuum analysis it's either BUY or SELL. No one knows your portfolio to tell more, so everyone assumes that your money from a corresponding risk category just sits idle.

Re: $130B wiped off crypto markets in 24 hours

#332

Post by 0x0 »

rjmunro wrote: post #304
0x0 wrote: post #202

Earlier quoted context omitted.

I guess if the price of BTC goes up, then it makes it more "worth it" to throw more energy at mounting a double-spend attack, and therefore the energy needed to protect the network against such an attack also goes up?

It's much simpler than that. If the price of BTC goes up, it's worth spending more on electricity to mine it. If 1 coin costs $50,000, and you already own the rig, it's worth spending $49,999 on electricity to mine the next coin and you will make a profit. If you're rig can't do that, you're better off just turning it off.

Sure, but if the BTC prices rise enough then it is in every transaction recipient's benefit that the network is mining even if there aren't any new coins minted, to avoid a "51% attack" / double spend attack.

Re: $130B wiped off crypto markets in 24 hours

#334

Post by koonsolo »

dandare wrote: post #63
Hokusai wrote: post #12

That's all the point of crypto-currencies, they need to go up and down to enable speculation. Pump and make it go up. Dump and it goes down. Someone is cashing the difference. A stable crypto-currency will not attract so much speculative investment.

A stable crypto-currency will not attract any investment. Crypto is useless for anything but money laundering and speculation.

Tether has a $69 billion dollar market cap

USD Coin has $42 billion, Binance USD has $12 billion, Terra USD $9 billion, Dai $8 billion, ...

you were saying?

Re: $130B wiped off crypto markets in 24 hours

#335

Post by [deleted] »

kmeisthax wrote: post #267
SeanAnderson wrote: post #13

Earlier quoted context omitted.

Netflix is down 35%, not sure why Google would be seen as the hardest-hit FAANG.

The dirty secret of "FAANG" is that Netflix is not a FAANG company anymore despite literally being the N of the acronym. The idea behind FAANG was to create a catchy acronym for "high-growth, big-cap tech stock". At the time, maybe it made sense to stick Netflix in the acronym - but their business model was also radically different than it is now. It also wasn't really sustainable: Facebook, Apple, Amazon, and Google…

[deleted]

Re: $130B wiped off crypto markets in 24 hours

#336

Post by koonsolo »

dandare wrote: post #302
soared wrote: post #224

Earlier quoted context omitted.

I’m no crypto fan but this is just incorrect. Stablecoins exist solely to be stable, look at tether.

You are right. How are they useful?

When you put money in the bank, it's backed by 1% real assets (go fractional reserve money!)

So let's say I don't want to put my money into something that is only 1% backed (See the Greek dept crisis). I could store cash under my mattress, but that also has some major risks.

With a stablecoin like UST, you 100% own it. Governments can't confiscate it. It's 100% backed by the asset behind it (not talking about Tether here ;)). I do agree that it comes with its own set of risks, but some people might prefer that risk over the ones above.

Or maybe I'm a foreigner and want to keep some of my personal value in dollars, but don't want to do that in cash or at some local bank.

It's basically another option at your disposal. And as the market cap of those stable coins prove, lots of people prefer that.

Re: $130B wiped off crypto markets in 24 hours

#337

Post by acdha »

koonsolo wrote: post #334
dandare wrote: post #63

Earlier quoted context omitted.

A stable crypto-currency will not attract any investment. Crypto is useless for anything but money laundering and speculation.

Tether has a $69 billion dollar market cap USD Coin has $42 billion, Binance USD has $12 billion, Terra USD $9 billion, Dai $8 billion, ... you were saying?

There's more to it than multiplying the current price by the number of coins in existence: you need to consider the questions of liquidity and what an attempt to sell a non-trivial amount would do to those exchange rates as people start questioning whether they want to put more hard currency in. Cryptocurrencies are the weakest form of fiat currency and that means that there's a very real chance you simply cannot find enough buyers at the price you want to pay.

This can technically happen with other currencies, of course, but they're so much larger and more stable that it's orders of magnitude less likely. You need a world-shaking catastrophe not to find someone willing to take USD because so many contracts are written in USD, and there's plenty of need to pay taxes or interact with government contracts and employees.

Re: $130B wiped off crypto markets in 24 hours

#338

Post by acdha »

3np wrote: post #198
dragontamer wrote: post #65

Earlier quoted context omitted.

Store of value. US money printer. Inflation hedge. Do you think we forget what the crypto-bros said just a few months ago?

Bitcoin isn't pretending to be any of those (which is essentially what the claim is). Do you see any of that on bitcoin.org, anywhere in Bitcoin Core, or in the Bitcoin Whitepaper? Or in any of the top cryptoassets by market cap? Don't conflate people talking about something with the thing itself.

Bitcoin proponents have been semi-continuously yammering about all of those for over a decade. If anyone seriously disagreed, there'd be a disclaimer on bitcoin.org.

Re: $130B wiped off crypto markets in 24 hours

#339

Post by compsciphd »

joecool1029 wrote: post #290
tiku wrote: post #261

Earlier quoted context omitted.

Why would a bitcoin miner sell his mined BTC for less than the power costs?

To pay down rising borrowing costs?

how? I mined and got $10 in mining rewards. I owe $12 in electricity. what money do I have left over to pay down anything?

Re: $130B wiped off crypto markets in 24 hours

#340

Post by orwin »

matheusmoreira wrote: post #305
hn_throwaway_99 wrote: post #303

Earlier quoted context omitted.

I'm not assuming anything. There is a guaranteed deep correlation between BTC price and amount of electricity needed to run the BTC network. That is the way proof of work is designed to function. I.e the whole way it protects against a 51% attack. There is simply no getting around this.

There is a relationship between mining difficulty and energy consumption. What I don't see is the correlation between price and mining difficulty. By this logic, mining activity should be way down right now.

I've read this explanation that i find explicit:

""" If 1 coin costs $50,000, and you already own the rig, it's worth spending $49,999 on electricity to mine the next coin and you will make a profit. If you're rig can't do that, you're better off just turning it off. """

Note that this is how it worked for bitcoin startup five years ago once the first specialized bitcoin rigs came into being. When the price of electricity where they operated became too high, some startup shut out or just changed their operations to create value around BTC(email/photograph ID/validation on the blockchain or other stuff like that)

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