Crypto is an unproductive bubble • Hacker News Board

Re: Crypto is an unproductive bubble

#451

Post by hiq » Sat, Mar 19, 2022, 2:08 PM UTC

kweingar wrote: post #347

paxys wrote: post #52

Earlier quoted context omitted.

That is circular reasoning. Bitcoin is also a collectable, with a fixed number of them (21 million) out there to collect. Every investment we are talking about is only rare because the community that participates in it has decided they are rare. Otherwise there is nothing stopping me from taking a picture of a piece of art or trading card and reproducing it a million times.

> Bitcoin is also a collectable, with a fixed number of them (21 million) out there to collect. Bitcoin is fungible, unlike collectibles. There is no value to holding one bitcoin vs another, if "different bitcoins" even makes sense as a concept. It can also be subdivided, so it is more accurate to say that there are 21 trillion units that will be out there.

> Bitcoin is fungible

Just looking this up makes clear that this is not really the case.

Re: Crypto is an unproductive bubble

#452

Post by lern_too_spel » Sat, Mar 19, 2022, 2:10 PM UTC

oceanplexian wrote: post #391

lern_too_spel wrote: post #379

Earlier quoted context omitted.

I wasn't discussing the case of Canada banning Bitcoin but of Canada sanctioning the truckers' wallets. Wherever the truckers go, their Bitcoins would no longer be allowed on Canadian exchanges. The fiat equivalent would be moving money to an overseas account. Before you are sanctioned, doing so is just as easy as buying Bitcoin. After you are sanctioned, both are equally hard. The difference is that your Bitcoins ca…

How is it hard? Canadian sanctions only work in Canada. Say I'm an American, for example. I'd receive "sanctioned" bitcoins from a Canadian and then send them non-sanctioned bitcoins back to a different wallet address. There is no "exchange" being used in this process. I could then happily spend or transfer said coins in the 99% of the world that isn't Canada.

This is explained in the GGGP comment.

Re: Crypto is an unproductive bubble

#453

Post by lern_too_spel » Sat, Mar 19, 2022, 2:12 PM UTC

oceanplexian wrote: post #392

stale2002 wrote: post #233

Earlier quoted context omitted.

> You just need to control the onramps and offramps. Thats a nice theory, but in reality it is false/implausible to be able to control every single on and off ramp in the world. Evidence: Nobody is currently controlling all the on an off ramps, despite the fact that I have heard the same exact argument that you are making right now, for literally over a decade.

You don't even need to off-ramp it, which was the whole point of crypto. I could cut your lawn, sell you an Xbox, or buy an old tractor completely with BTC. The government can cry about it all it wants, it can pass a hundred laws, or issue a thousand court orders. But at the end of the day, it has absolutely zero control if two individuals want to voluntarily exchange crypto with each other. We've already seen this p…

What you've really seen play out is that the government hasn't bothered to regulate cryptocurrencies yet. After they regulate cryptocurrencies, this becomes much easier to prevent.

Re: Crypto is an unproductive bubble

#454

Post by yanderekko » Sat, Mar 19, 2022, 2:19 PM UTC

Tretiotrr wrote: post #418

yanderekko wrote: post #282

Earlier quoted context omitted.

>Is it really your selling point that crypto is good because Russians can wage war while circumventing sanctions? No, this is a person sending money to their brother, who is presumably not engaged in "waging war."

The timing for such a bad argument is bad and it is still shitty. Crypto bros telling us how great it is for the poor people in such countries to get money. Now we see the downside of this as well. Oligarchs protecting their assets as well. Leveled playfield. No added benefit from crypto anymore. And yes right now for me, sanctioning is more critical to me to increase the pressure on Russia to stop killing people tha…

Well, one can easily disagree with the justice of these sorts of indiscriminate collective punishments. At the end of the day you're going to have a hard time justifying to someone why they should feel morally compelled to cut off remittances to their family members because of these sort of high-level geopolitical concerns.

The more that financial repression and "cancellations" become mainstream, the more obvious crypto's use cases become - whether or not you support the individual examples of repression.

Re: Crypto is an unproductive bubble

#455

Post by rvz » Sat, Mar 19, 2022, 2:24 PM UTC

xtracto wrote: post #446

jmcgough wrote: post #19

One of the biggest drawbacks for blockchain is that transactions can't be revoked after the fact (with the only exception being costly forks of the entire ledger), and there's no additional human oversight (like I'd get when sending a large amount of money through a bank) to protect me. If someone steals my credit card, I have my credit card company to give me some level of protection. They can block transactions if…

>One of the biggest drawbacks for CASH is that transactions can't be revoked after the fact, and there's no additional human oversight (like I'd get when sending a large amount of money through a bank) to protect me. Snark aside, my 70yo dad fell into a very stupid fraud where someone called him and convinced him to send money from his bank account to some other (this is using Mexican Gov digital money transfer netwo…

> So, bank transactions are not as revocable as they want you to think, for the lay person at least.

Santander [0] agrees with you.

[0] https://www.bbc.com/news/business-59826345

Re: Crypto is an unproductive bubble

#456

Post by cf141q5325 » Sat, Mar 19, 2022, 2:35 PM UTC

dmitriid wrote: post #409

cf141q5325 wrote: post #209

Earlier quoted context omitted.

It boils down to the same thing. Inflation is nothing more then inflation expectation, as people change their behavior as a result. The fact that fiat is moving towards 10% inflation is a direct result of a reduction in trust in it as a store of value. People expect it to be worth less, and as a result it is. If you look back over any period of time you have a constant erosion of trust in its ability to store value s…

> The fact that fiat is moving towards 10% inflation Crypto had value swings far greater than that in the past 6 months alone.

But not over time. Fiat has been constantly going down since its inception

Re: Crypto is an unproductive bubble

#457

Post by hiq » Sat, Mar 19, 2022, 2:42 PM UTC

fsociety999 wrote: post #140

Congratulations. You knew exactly what to write to make it to the top of Hacker News. Sadly, it doesn’t take a whole lot of original thought these days. Just repeat the establishment talking points that crypto is a bubble and will be worth zero someday, and you will be blessed with hundreds of upvotes. This is echo-chamber, groupthink at its best. You are, of course, free to believe whatever you like, but the way you…

You mention problems with the current situation but you don't really explain how Bitcoin solves these problems. E.g. an asset that varies so much in real terms is not a solution to people losing their savings over inflation.

> when you are faced with accepting a currency that is losing 10-20% of its purchasing power every year, or accepting Bitcoin, eventually people will understand that Bitcoin is the better money.

How can this be a better money with such a volatility? Over the last three months, it looks like the minimum rate was 35kUSD/BTC and the maximum 50kUSD/BTC[0]. If you buy at the wrong time you can easily lose way more than 20% in way less than a year. Looking for articles about BTC volatility, it also doesn't seem to be going down.

Very practically speaking, in most countries, I'd see people buying real estate before they buy BTC to protect themselves against inflation.

0: https://coinmarketcap.com/currencies/bitcoin/

Re: Crypto is an unproductive bubble

#458

Post by jakupovic » Sat, Mar 19, 2022, 2:50 PM UTC

amon22 wrote: post #449

jakupovic wrote: post #427

Earlier quoted context omitted.

Alm you're doing here is measuring what you think the benefits to the society are from cars vs bitcoin. Just because it is useless in your opinion does not make it so, and you should qualify your statements with, "in my opinion", rather than saying this with absolute conviction.

Crypto in it's current form is indeed useless.

"In my opinion", simple then your statement makes sense.

Re: Crypto is an unproductive bubble

#459

Post by leonth » Sat, Mar 19, 2022, 2:58 PM UTC

oceanplexian wrote: post #392

stale2002 wrote: post #233

Earlier quoted context omitted.

> You just need to control the onramps and offramps. Thats a nice theory, but in reality it is false/implausible to be able to control every single on and off ramp in the world. Evidence: Nobody is currently controlling all the on an off ramps, despite the fact that I have heard the same exact argument that you are making right now, for literally over a decade.

You don't even need to off-ramp it, which was the whole point of crypto. I could cut your lawn, sell you an Xbox, or buy an old tractor completely with BTC. The government can cry about it all it wants, it can pass a hundred laws, or issue a thousand court orders. But at the end of the day, it has absolutely zero control if two individuals want to voluntarily exchange crypto with each other. We've already seen this p…

In virtually every country, there exists the definition of legal tender, which basically is the currency that taxes are paid and the currency that courts recognize as viable payment for debts.

So really, in FreedomLand, you can work and get paid in BTC, but if FreedomLand only recognizes FreedomDollar as legal tender, then when you need to pay income tax, the government will charge you in FreedomDollar, and you need to exchange your BTC to FreedomDollar.

If you cannot or don't want to pay tax, then of course police will prosecute you, and courts will also require settlements in FreedomDollar. Nevermind you have millions of BTC or XBoxes.

Now of course, this "problem" would disappear if FreedomLand recognizes BTC as legal tender, but now FreedomLand government loses all monetary control, and then economic activity descends into chaos.

Re: Crypto is an unproductive bubble

#460

Post by gonehome » Sat, Mar 19, 2022, 3:15 PM UTC

thr0wawayf00 wrote: post #433

gonehome wrote: post #290

Earlier quoted context omitted.

You’re right about FDIC protection. The wire fraud example is really the least important part of my comment (it was just showing risk exists with some traditional financial transactions too). Exchange risk is tempered somewhat by Coinbase which is more comparable to a standard bank in terms of risk (imo). The true value and capability that’s distinct with crypto is self-custody and that is the important part of my co…

> Exchange risk is tempered somewhat by Coinbase which is more comparable to a standard bank in terms of risk (imo). The fine print does not bear this out at all. Coinbase states in their TOS that your funds may not replaced in the case of a breach because they do not insure the entirety of accounts, nor do they stipulate a guaranteed insured amount:[0] > In case of a covered security event, we will endeavor to make…

FDIC insurance is capped at 250k. The recovery there is also limited and it’s a bad idea to keep large amounts of money in a bank account.

> “Comparing the risk profile of Coinbase to a bank is no different than blindly trusting a big bank not to fail.”

That’s kind of my point? They share a similar risk.

The most interesting thing with crypto is the new capabilities it enables for self custody of wealth.

There’s also the non-government controlled supply and global store of value which are interesting too, but easier self-custody is the prerequisite differentiator imo. It’s also one of its core advantages over gold (the others being easier to transact with, easier to move/store which is related).