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Is this the end of crypto?

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Re: Is this the end of crypto?

#191

Post by bnralt »

P5fRxh5kUvp2th wrote: post #106
cooljacob204 wrote: post #11

When Crypto was young it was this cool new technology that mostly interesting because of the underlying tech. But even back then it was mostly valuable for buying drugs online and other illegal stuff. Now it's that and a way to scam people of their life savings. I do hope it dies out, it should have been heavily regulated from the get go. Way too many people saw these high production commercials with their favorite c…

When bitcoin first came onto the scene I personally knew a guy who was running a website to act as an exchange. It was small because bitcoin itself at that time was very small. Then bitcoin had its very first dip and it became unprofitable to mine bitcoins. When that happened he shuttered the website and kept everyone's bitcoins. I knew of bitcoin early on due to this guy, but even then I had no interest and consider…

> If the value of gold crashes it still has an inherent value because it's a useful physical good (looking pretty is not the only application of gold).

The value of gold is protected by the fact that the majority of it's holdings (at least, according to this[1]) aren't used for speculation. Still, a good chunk of them are, which means there can be pretty huge swings and it's considered a poor investment.

Have tried to say the inherent value of a dollar is because it's backed by the U.S. military, but fundamentally, it's the same reason. Dollars aren't held as speculative assets. The poor returns from the dollar are one of the reasons why people push other investments. If currency does enter into speculative territory, bad things can (and do) happen. See Hot Money[2].

Anything, even if it has inherent value, can be extremely dangerous when there's a large number of speculators. Because no matter the value, speculation can drive the price much, much higher. And it's a snowballing effect - the more an asset rises, the more people want to buy it for speculative reasons, and the more people buy it the more it rises.

And then any inherent value (if it even exists) looses significance - you're in a game of chicken with the other investors, trying to both hold on as long as you can and get out before everyone else does. The winner gets the fortune, the loser is left holding the bag.

The thing is, almost everyone in the crypto space seems interested in speculation. It might be speculation + decentralized voting rights or speculation + digital ownership, but speculation is always at the heart of it. The idea that if you get in early you'll be able to cash out for a big profit. Of course a space almost entirely driven by speculation is going to be inherently dangerous and unstable, and the "opportunities" are the same type as those of a casino.

[1] https://en.wikipedia.org/wiki/Gold_holdings [2] https://en.wikipedia.org/wiki/Hot_money

Re: Is this the end of crypto?

#192

Post by runarberg »

azangru wrote: post #155
P5fRxh5kUvp2th wrote: post #106

Earlier quoted context omitted.

When bitcoin first came onto the scene I personally knew a guy who was running a website to act as an exchange. It was small because bitcoin itself at that time was very small. Then bitcoin had its very first dip and it became unprofitable to mine bitcoins. When that happened he shuttered the website and kept everyone's bitcoins. I knew of bitcoin early on due to this guy, but even then I had no interest and consider…

> When that happened he shuttered the website and kept everyone's bitcoins. > I knew of bitcoin early on due to this guy, but even then I had no interest and considered it bullshit. Then when I saw what this guy did it just solidified my opinion that it can't be trusted. But isn't it instead an early lesson in "not your keys not your coin" maxim that Bitcoin advocates preach? > If the value of gold crashes it still h…

Your parent was talking about gold in the niche case of protecting from inflation, and passed no judgement over the merit of doing so, only that it was better then cryptocurrency in that particular niche.

If you want to purchase gold to protect your money from inflation (which you probably shouldn’t) then you probably buy it through some insured exchange—maybe even through your bank—that will keep it for you, if you don’t trust any exchange, that is your problem. If you need to transfer your money, or use it, then you’re not protecting it against inflation anymore are you? So you will just use regular money for that.

Anyway, you shouldn’t buy gold to protect your money from inflation. Instead you probably should just risk an inflation and keep your money in a savings account, or buy secure government bonds for it, or something.

Re: Is this the end of crypto?

#193

Post by efficax »

legutierr wrote: post #92

We are making steady and inexorable progress through the technology hype cycle. From earlier this year: https://emtemp.gcom.cloud/ngw/globalassets/en/articles/image... Now we enter the Trough of Disillusionment. Given the general accuracy of this model/metaphor in the past, should we consider it to be any different this time around?

This graph is missing a key aspect: the "it utterly fails and we never speak of it again" section.

Re: Is this the end of crypto?

#194

Post by legutierr »

efficax wrote: post #193
legutierr wrote: post #92

We are making steady and inexorable progress through the technology hype cycle. From earlier this year: https://emtemp.gcom.cloud/ngw/globalassets/en/articles/image... Now we enter the Trough of Disillusionment. Given the general accuracy of this model/metaphor in the past, should we consider it to be any different this time around?

This graph is missing a key aspect: the "it utterly fails and we never speak of it again" section.

I imagine that would be your preferred outcome.

Re: Is this the end of crypto?

#195

Post by yonaguska »

pessimizer wrote: post #142
cft wrote: post #109

Earlier quoted context omitted.

Get ready for CBDC, surveillance of every transaction and economic unpersoning then.

The government doesn't need a cryptocoin to monitor transactions, or to make using paper currency illegal. It can already do what you think it needs a cryptocoin to do, and it doesn't do it because it supports wealthy people being able to launder money and avoid taxes. US politics runs entirely on laundered money and misdirected/avoided taxes. You're lobbying for the swamp.

I anticipate CBDC being something for the peons to use, not the elite. Yes, the government can monitor transactions, but it currently has to jump through a lot more loopholes to do so. I understand and agree with your sentiment, with the additional point that smaller banks are also going to be made obsolete if a CBDC is rolled out.

But the wealthy and connected will most certainly have their own way of getting around the system. Whether that means moving their money into physical assets, or onto the market, I don't know. I don't think cash is going to go away, but I do see the government incentivizing regular people to solely use CBDC, and once you're on that system, you are a serf.

Re: Is this the end of crypto?

#196

Post by mjburgess »

olalonde wrote: post #183
mjburgess wrote: post #160

Earlier quoted context omitted.

No, that doesnt follow. But in any case, what is "using" bitcoin? Is it purchasing bitcoin? ...how do I do that? I'd need to rely on the two mining companies, right? And the exchanges? Or not? And can I use bitcoin as currency in any shop? No? If I could, I'd be relying on the state to provide the same rights behind all economic transactions to enable, that right? And what happens if the handful of "wales" decide to…

> But in any case, what is "using" bitcoin? > Is it purchasing bitcoin? ...how do I do that? I'd need to rely on the two mining companies, right? And the exchanges? Or not? Transacting on the Bitcoin network: sending BTC from one party to another. There are more than two mining companies, otherwise Bitcoin's security model fails (see 51% attack). Of course, centralized exchanges are... centralized. > And can I use bi…

We are largely in agreement as you concede my points. But you want to retain this word as applied, eg., to bitcoin.

The sound of rain falling is neither "centralised" nor "decentralised". It isnt the kind of thing which could be either *in the relevant sense of the word*.

When we talk about centralisation in economics and politics we arent talking about where databases are.

Bitcoin is as centralised *a system* as any which exist, and much much more so than paper money.

This idea that you can send a signal betweeen two machines you own and make some changes to your wallet is a gross misdirection.

That has nothing to do with any of the value props of crypto. It has no economic or political meaning. It's purely a technical property of the technology.

Re: Is this the end of crypto?

#197

Post by yieldcrv »

kojeovo wrote: post #178
yieldcrv wrote: post #71

Earlier quoted context omitted.

No, decentralized exchanges have had more volume and liquidity than centralized exchanges for 2 years.

Cuz of NFTs?

Not because of NFTs, people that chose to learn how to use crypto natively find it easier, faster and less of a hassle, than the people that chose to say these are insurmountable barriers to adoption and stick with those custodial exchanges

Just like with general computer use, after a certain point people can’t blame the user experience on their own incompetence

Re: Is this the end of crypto?

#198

Post by ccbccccbbcccbb »

This is the final chapter of the blockchain story, created from the scratch by the bankers, who lured early adopters with ideals of anonymity, digital anarchy and other cryptopunk ravings, made them run the prototype of bankers' future monetary system at their own and later investors' expense, provided for schemes to make rich richer and poor poorer, made huge profits for the energy-generating companies, and what the economist really says now is a gloating 'thank you, nerds and wannabe-billionaires, you can now go to hell and don't mess in the way of us the big guys'

Expect a world-wide blockchain-based banker-controlled centralized biometrically authenticated One World Currency soon, which you can loose access to for walking a red light, wearing a pajama in public, not joining the next scheduled Je Suis Charlie charade or refusing to jab.

Re: Is this the end of crypto?

#199

Post by danaris »

azangru wrote: post #155
P5fRxh5kUvp2th wrote: post #106

Earlier quoted context omitted.

When bitcoin first came onto the scene I personally knew a guy who was running a website to act as an exchange. It was small because bitcoin itself at that time was very small. Then bitcoin had its very first dip and it became unprofitable to mine bitcoins. When that happened he shuttered the website and kept everyone's bitcoins. I knew of bitcoin early on due to this guy, but even then I had no interest and consider…

> When that happened he shuttered the website and kept everyone's bitcoins. > I knew of bitcoin early on due to this guy, but even then I had no interest and considered it bullshit. Then when I saw what this guy did it just solidified my opinion that it can't be trusted. But isn't it instead an early lesson in "not your keys not your coin" maxim that Bitcoin advocates preach? > If the value of gold crashes it still h…

> "not your keys not your coin" maxim that Bitcoin advocates preach?

I keep seeing this phrase crop up throughout the past several days of cryptocurrency news, and something always rubbed me the wrong way about it, but I couldn't put my finger on it until today.

It's demanding a change in human nature to accommodate the system, rather than changing the system to accommodate human nature.

It's really not that different than the people who, 15 years ago, were saying, "Well, of course your accounts got hacked, because you didn't create a separate 27-character totally random password for every single account you need, like I do, and never store those passwords anywhere except your head!"

People don't want to deal with a hardware token every single time they want to do anything with their money...and the only reason they have to, with cryptocurrency, is because its proponents think an unregulated "decentralized" financial system where the only law is code is a good idea. (Of course, it was never going to stay unregulated forever. None of the aspects of cryptocurrency that rely on the government not paying attention can last more than another few years.)

Re: Is this the end of crypto?

#200

Post by psychlops »

danans wrote: post #154
throwup wrote: post #119

Earlier quoted context omitted.

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3942181 > For example, illegal transactions, scams and gambling together make up less than 3% of volume.

You excluded the first part of that paragraph: > We show that the vast majority of Bitcoin transactions between real entities are for trading and speculative purposes. Starting from 2015, 75% of the real bitcoin volume has been linked to exchanges or exchange-like entities such as on-line wallets, OTC desks, and large institutional traders. So 75% of the transactions are just speculative trading, not transactions for…

Seems like you will get your wish as the trend is leading towards a future where only approved transactions will be allowed.
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