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Why I’m Cryptophobic

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Re: Why I’m Cryptophobic

#181

Post by samatman »

peyton wrote: post #5
mjburgess wrote: post #4

There needs to be some basic economics here.. Money has value because of the value of the economic transactions in which its conducted. Government-backed currencies are forced to have value in the sense they force people to use it for their taxes. The US, additionally, forces the world to use it for oil trades. Value is in those economic transactions. A currency is just a "liquifying" of that value, to make it easier…

I really don’t buy the old taxes-make-the-money-work chestnut. Far too many counterexamples.

I agree with this, it's a market of last resort but it hasn't prevented hyperinflation ever.

No one facing a hyperinflationary death spiral says "oh well, at least the government will take taxes in this crap" they desperately cast around for a stable place to put wealth.

Re: Why I’m Cryptophobic

#183

Post by yellowapple »

colpabar wrote: post #178
yellowapple wrote: post #164

Earlier quoted context omitted.

Doesn't really make much of a difference; "only give your banking info to those you highly trust and only if it's absolutely necessary" has been common sense for longer than the Internet has existed.

you completely ignored the question lol we know that you know, and that we know, but the comment was saying that most people don't.

No, I directly addressed the question: it's common sense, i.e. entirely independent of tech-savviness or age or other factors. It's indeed common sense passed down to me from people far less tech-savvy (and far older) than myself.

Re: Why I’m Cryptophobic

#184

Post by bombcar »

yakak wrote: post #86
elil17 wrote: post #50

Earlier quoted context omitted.

Genuinely curious here: has anyone actually proposed making family helping with childcare illegal (or perhaps taxed?) Even if it’s just an economist weirdo I’d be curious to see what the argument is there

The exceptions in the rules here for example are almost certainly directly constructed by Congress or anger from Congress and not particularly consistent with how the IRS expands laws by expanding existing theories if left alone: https://www.irs.gov/businesses/small-businesses-self-employe...

Most IRS rulings and much of tax law itself are to try to patch over loopholes that are being exploited (the very page describes the various checks they have in place).

Re: Why I’m Cryptophobic

#185

Post by tuesdayrain »

mjburgess wrote: post #4

There needs to be some basic economics here.. Money has value because of the value of the economic transactions in which its conducted. Government-backed currencies are forced to have value in the sense they force people to use it for their taxes. The US, additionally, forces the world to use it for oil trades. Value is in those economic transactions. A currency is just a "liquifying" of that value, to make it easier…

Your mistake is valuing cryptocurrency purely as a currency. In reality BTC and other cryptos have combined properties of currencies, commodities, securities, as well as unique elements that can't be found elsewhere. Crypto is its own asset class and trying to value it using old models of other assets is bound to fail.

Re: Why I’m Cryptophobic

#186

Post by samatman »

hans1729 wrote: post #56
capableweb wrote: post #26

Earlier quoted context omitted.

> This is not the case for crypto No? You don't think the following statement is as true as the one you made? "If you have Bitcoin, you will find someone who is willing to exchange it for something else with material value in any city on the planet" My experience would tell me otherwise, but maybe I'm a outlier.

Scenario: a country-wide blackout occurs. You're haggling with local farmers for food. Which has value to them, bits on a hard drive or solid gold?

Counter scenario: you're fleeing a country ahead of war, and you know that metal detectors will be involved and your gold will be taken. But they will not be checking every piece of paper you have, everyone is in a hurry. The bank run already happened and reinsurance depends on the capital staying functional.

Bitcoin wins.

See, we can do this all day. There are points of comparison and points of departure.

Re: Why I’m Cryptophobic

#187

Post by dmoy »

benreesman wrote: post #57
mjburgess wrote: post #30

Earlier quoted context omitted.

You're right that BTC has a floor because there's some economy behind it. I'd say in the 100USD-1000USD/coin range.

I’ll sell you that contract up to what I can finance it at.

You completely ignored what GP said.

The floor is different from what people will sell it to you for right now.

AMZN may have a floor of $ASSETS / #SHARES (or something, I just made that up), but that doesn't mean anyone will sell it to you for that right now.

Re: Why I’m Cryptophobic

#188

Post by XorNot »

hans1729 wrote: post #118
apocalypstyx wrote: post #91

Earlier quoted context omitted.

>economies can crash. Gold can not, thus is it valuable. The thing about money is that it is a technology. But unlike other technologies, such as an electric toothbrush, for instance, it has an additional quirk: without belief, it doesn't work. Regardless of whether or not I believe in electricity, an electric tooth brush turns on and off; if the participants in an economy don't have faith in the economy, the economy…

>Gold is like an old god: its faith has a lot of coinage. However, its rule is not necessarily omnipresent. Very nice point, you're not wrong. That being said: >we are in a post-nuclear apocalypse. I have a small trading post and a can of beans; you have a solid gold coin. Challenge: convince me why I should take the coin. Because it has properties that qualify it as a method of exchange (portability, provable chemic…

Proving you're not getting duped with plated lead is actually pretty hard to do without high technology, hence the reason gold coinage came into existence and then gold depositories and banking and all the rest.

Gold is transitorily convenient provided you exercise military force over a domain - that is you can force gold to be accepted for debts within your dominion. Nothing about it makes it intrinsically valuable otherwise - and more importantly you having gold doesn't grant you wealth because you didn't economically contribute to the system to start with.

Turning up with all the gold you want would get it rejected or siezed because it wasn't an approved coinage.

Re: Why I’m Cryptophobic

#189

Post by kloch »

aabhay wrote: post #100
dcolkitt wrote: post #58

Earlier quoted context omitted.

The continued existence of gold as a store of value (and to a lesser extent silver) contradicts this model. Very few economic transactions are denominated in gold, either as a medium of exchange or a unit of account. There is a small amount of industrial demand, but this is far too tiny to justify gold's gigantic market capitalization. Valued on industrial demand alone gold would maybe worth $100/oz, yet today it tra…

Gold is the world's best physical commodity to use as a store of value -- it doesn't degrade or tarnish, is easily molded into coins or other symbols, melts easily, has a highly fixed supply (synthesizing it is prohibitively expensive), and (now) increasingly is not tied to an industrial output so can weather GDP fluctuations. So in a battle Royale of all commodities, gold wins. That said, all commodities are affecte…

> a highly fixed supply (synthesizing it is prohibitively expensive)

This is what gives Bitcoin much of its value as well.

> Gold is conceptually very similar to bitcoin, except gold can't be forked or copied

This touches on another thing that makes Bitcoin valuable - consensus. Enough people agree to use it that it becomes the defacto standard.

Bitcoin (and Ether to a lesser extent) are the “rough consensus and running code” of decentralized algorithmic money

The two points are related. It was much easier to synthesize Bitcoin when fewer people were using it, and it’s market value was less.

This auto-scaling of difficulty with interest/value was added as a security mechanism but actually plays a key monetary role as well.

Re: Why I’m Cryptophobic

#190

Post by tuesdayrain »

throwaway413 wrote: post #162
chaosbolt wrote: post #111

Earlier quoted context omitted.

Well an apple has value because it's food, but if today people are willing to pay 1 banana for it and tomorrow they're willing to pay 2 bananas for it, the apple still has the same value it did yesterday because the calories in it haven't changed, but you can actually obtain twice the calories you could've obtained yesterday by taking the banana (2 bananas today), so its value today has doubled. Bitcoin is a 0 calori…

This is well said, I’m gonna borrow that - “crypto is like a 0 calorie apple.” This matters. Even gold, at least I can wear it and display my wealth. You can’t even display your crypto wealth like that. It is entirely lacking in any “real” value. Idea: luxury tshirt made out of a $5 white tee with a wallet QR code slapped on the front showing off the balance of the shirt. Or a ring. Crypto fine jewelry.

>Even gold, at least I can wear it and display my wealth. You can’t even display your crypto wealth like that

I'd feel much safer displaying large sums of wealth online by posting a wallet than by wearing luxury goods in public.

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