Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

$3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

cnbc.com

Post reply on HN
Print view View original

341–350 of 540 posts

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#341

Post by samatman »

snovv_crash wrote: post #201
eric_cc wrote: post #90

Earlier quoted context omitted.

LUNA minted trillions of brand new tokens within the span of a day or so rendering the token worthless. This is due to the way LUNA was tied to the algorithmic stablecoin UST. It was a true ponzi. BTC's max supply is capped and the release schedule of new coins is fixed and predictable. There is no possible way that trillions of new bitcoins could suddenly be created.

Luna crashed because people lost trust in it. The only reason people have trust in BTC is because other people have trust in it. If that ever changed, there is no actual use for a BTC, and they are thus intrinsically worthless. Fiat currency has the backing of a government. The government demands certain payments of this currency in order to own land, and also for some extra rights like mineral extraction, fishing li…

To be perfectly clear, you're claiming with a straight face that government issued currencies are stable because there will always be a buyer who needs to pay taxes?

Any reasonable definition of stability precludes hyperinflation, we agree on that right?

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#342

Post by ttfkam »

Terry_Roll wrote: post #306
jliptzin wrote: post #186

Earlier quoted context omitted.

I never understood the argument why crypto was a good store of value. Sure, it’s an ingenious new transactional system, making global payments mostly frictionless, etc, but that’s true whether the value of 1 Bitcoin is $1 or $50,000. If everyone’s just converting back to fiat anyway, only keeping enough BTC transiently to settle transactions, why hold it long term?

> I never understood the argument why crypto was a good store of value. Its digital gold thats it, its no more a store of value than antique's, rare cars, fine arts etc etc and unsurprisingly those markets can also see the bottom drop out of them for decades. Ultimately its people en masse who decide what something is worth, but big players can manipulate those markets with resources, laws, taxation, media sentiment…

Gold can be used for corrosion-resistant electrical contacts, infrared reflectors for space telescopes, decoration in gaudy penthouses, and more even if everyone decided it was useless as a currency.

An antique desk that loses all value in the open market can still be used as a desk or at least firewood.

A rare car can still be used to transport yourself, as a prop in a movie, or scrap for other projects.

A "worthless" painting can still inspire, liven up a room, or gifted as a gag.

Crypto that loses its value has no other underlying utility over and above the output of /dev/random. That's a MASSIVE difference and more clearly demarcates BTC as a money laundering/Ponzi scheme rather than "digital gold" or a viable currency.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#343

Post by peyton »

snovv_crash wrote: post #189
eric_cc wrote: post #157

Earlier quoted context omitted.

Same with paper fiat currency.

Actually paper fiat currency is accepted by a government to pay property tax. In this way you need it to keep possession of land, so the entire land value of the linked country, and all the infrastructure built on it, is the backing for 'fiat' currency.

I think I responded to your other comment, but I don’t think this is true. Do you have any further reading?

A currency is not backed by land value. It’s usually “backed” by a combination of sovereign debt obligations and its status as legal tender.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#344

Post by mrb »

mgfist wrote: post #251
jliptzin wrote: post #186

Earlier quoted context omitted.

I never understood the argument why crypto was a good store of value. Sure, it’s an ingenious new transactional system, making global payments mostly frictionless, etc, but that’s true whether the value of 1 Bitcoin is $1 or $50,000. If everyone’s just converting back to fiat anyway, only keeping enough BTC transiently to settle transactions, why hold it long term?

Well it's actually a pretty bad transactional currency because it costs so much to transfer btc. So it's kinda the opposite, where people mostly hold it instead of transacting. The argument for a store of value is that of gold but easier to store and transfer, better security etc.. Whether it's a good one is for you to judge.

"costs so much to transfer btc"

That's not true. The typical credit card processing fee ranges from about 1.3% to 3.5%. Average international remittance fees are about 7%. For comparison the average Bitcoin fee is about $1 right now, so 1% on a $100 transaction. So Bitcoin compares favorably to its competitors.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#345

Post by NovemberWhiskey »

peyton wrote: post #343
snovv_crash wrote: post #189

Earlier quoted context omitted.

Actually paper fiat currency is accepted by a government to pay property tax. In this way you need it to keep possession of land, so the entire land value of the linked country, and all the infrastructure built on it, is the backing for 'fiat' currency.

I think I responded to your other comment, but I don’t think this is true. Do you have any further reading? A currency is not backed by land value. It’s usually “backed” by a combination of sovereign debt obligations and its status as legal tender.

I think that's right - fiat currency is not asset backed; in the case of the USD, it's backed by "the full faith and credit" of the U.S. government.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#346

Post by vmception »

stingraycharles wrote: post #332
vmception wrote: post #298

Earlier quoted context omitted.

uh yes exactly? thats the only reason they bought the bitcoin in the first place Terra Luna was already stupid enough, its stupid to make this part controversial because that was the purpose of this collateral, just as its stupid to not believe the bitcoin was sold after transfer to the exchanges (many people believe that its still owned, or was given to some whales to bail just them out, or the founder keeps it for…

I know that it’s the plan, do they have any evidence (like transaction ids) that it actually happened? I haven’t followed this a lot but from what I gathered there’s not a lot of transparency around this. If so, why not?

There are transaction IDs to the exchanges

There wont be transaction IDs after that because its not onchain

You and the community could ask for an audit by an accounting firm like Deloitte, like the rest of the business world uses, itll come out a quarter or two from now leaving us all in exactly the same spot for now. The transparency expectations make almost no sense or lack inspiration.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#347

Post by jeffwass »

hypertele-Xii wrote: post #322
j245 wrote: post #278

Earlier quoted context omitted.

And the distance between love and glove is only 1.. who cares ?

This is actually a decent joke, buried under a dismissal.

A reference to this classic perhaps? https://en.wikipedia.org/wiki/The_Chaser_(The_Twilight_Zone)

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#348

Post by deadbunny »

solveit wrote: post #287
eric_cc wrote: post #241

Earlier quoted context omitted.

“It’s impossible” - I agree it’s almost always too strong. However, remember we’re discussing the creation of trillions of bitcoin. Even if it occurred, do you really believe the chain would remain? It would be forked. I just can’t imagine a chain being totally compromised and its users being okay with it - both would need to be true.

A smart attacker wouldn't create trillions of bitcoin, they would create a steady trickle of bitcoin indistinguishable from a medium-sized private mining operation that is too small to be noticed for a good while but large enough to make the attacker very very rich. It won't be noticed for months or even years and you cannot erase years of history. There will be no fix, only damage control. That said, SHA-2 being bro…

That not how bitcoins are created. You don't just make a few extra. The block reward is fixed, if someone made a block with more than the block award it'd be rejected by the network.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#349

Post by nwiswell »

seoaeu wrote: post #276
eric_cc wrote: post #205

Earlier quoted context omitted.

> Luna crashed because people lost trust in it. No. It crashed because trillions of tokens were created rendering each token worthless.

You have it backwards. The trillions of tokens were created because people lost trust in it. Specifically, the loss of trust instigated the price drop from $1 to ~98¢. That's what started the collapse. Only afterwards did the "death spiral" of minting of more tokens, which degraded trust, which decreased the price, which drove more minting, etc. happen

It's chicken and egg.

People lost trust because they knew people losing trust would cause a death spiral, and they wanted to get out before everyone else.

It was a fire in a crowded theater. Bitcoin depends on trust, yes, but there's no Damoclean sword like there was for Luna. Some people losing confidence does not necessarily lead to others losing confidence.

Re: $3B in Bitcoin was sold in a last-ditch attempt to save UST from collapse

#350

Post by FabHK »

lumost wrote: post #312
twox2 wrote: post #304

Earlier quoted context omitted.

IMO, this hypothesis hasn't been adequately tested. By all accounts inflation is bad, but not THAT bad. However, I'm sure Bitcoin and most Cryptocurrency is looking pretty stable with respect to Venezuela's 2,00,00% inflation. Bitcoin as a hedge against economic turmoil requires real economic turmoil.

A Venezuelan could also own dollar/euro denominated assets or commodities. BTC would need to be better and more stable than those for someone to view it as an effective hedge. If US or EU inflation hit 2000% there would be global consequences. There is no reserve asset currently large enough to redenominate US denominated assets, aid payments would collapse, and currencies pegged to the dollar would collapse. Betting…

> A Venezuelan could also own dollar/euro denominated assets or commodities.

If they're allowed to. Which underscores that the true innovation of Bitcoin is to circumvent rules and regulations.

Post reply on HN