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Warren Buffet and Charlie Munger on crypto in 2018

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Re: Warren Buffet and Charlie Munger on crypto in 2018

#121

Post by noxer »

jqpabc123 wrote: post #36
adriand wrote: post #5

Regardless of how you feel about crypto - and I admit to seeing some valuable use-cases, while being highly skeptical of the speculation - you gotta admit that these comments are prescient and also very funny. I sincerely hope I have that presence of mind at that age.

FedNow aims to provide *instant* and secure transfers between existing fiat bank accounts 24/7/365 at a projected cost of 5 cents per transaction. In trials now, scheduled to launch in mid-2023. The most valuable use-case for crypto was prodding the Fed to develop and implement this. If all goes as planned, consider crypto's work done. https://explore.fednow.org

5 cent per TX is actually expensive compared to some crypt solutions.

Also fednow does not work outside the US currency system. You can not send USD and receive EUR.

But guess what, there are actually crypto solutions that can do that faster and cheaper than any bank can today. The trick is to go over crypto to bridge different fiat currency so you can exchange USD to EUR without a third party taking a fee for the exchange.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#122

Post by mannerheim »

noxer wrote: post #114
rcarr wrote: post #32

I've always found this excerpt from a Doomberg article sums the whole thing up nicely: > We distinctly recall drawing two circles on a piece of paper. In the circle on the left, we wrote "Real Economy"; while in the circle on the right we wrote "Crypto Universe". We drew two pipes between the circles - one flowing into the crypto universe and the other flowing back to the real economy - and labeled both pipes with fi…

If you would make the same circles but with different fiat currency on one side and difference fiat currency on the other side you would figure out that exchanging different fiat currency isn't generating any value therefore the Forex markets should not exists. And extending on that knowledge any currency from a country that produced more debts each year should be worthless. Reality check: Nope, both not true in the…

But forex enables international trade. Dollars to euros or vice versa allows you to buy real products from America or Europe.

What can you buy with crypto? Drugs, ok... but that market is not big enough to justify its valuation. Financial products, fine, but what are the financial products? The underlying asset of the vast majority of these financial products is just other crypto stuff!

Well, you can speculate on fiat. But most of the fiat speculation uses centralised stablecoins shadier than an umbrella made by the mafia.

Like, I don't know, maybe there's a future for crypto in settling lumber futures or whatever, but at the moment, the FTX blowup makes it seem like every crypto financial product is based off of another crypto financial product.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#123

Post by yucky »

noxer wrote: post #115
chii wrote: post #51

Earlier quoted context omitted.

A casino is an analogue to crypto. The house takes in money, and produces entertainment. Some people also leave with more money than they go in, but most lose it all.

But there is no "house" in crypto this analogue make no sense.

Wouldn't the major exchanges be similar to "the House"?

Re: Warren Buffet and Charlie Munger on crypto in 2018

#124

Post by noxer »

newaccount74 wrote: post #18
kelthuzad wrote: post #11

I personally don't own any Bitcoin, but would you have bought it in 2018 you'd still be up approx. ~370% at the current dip, while you would have been profitable a whopping ~1700% at ATH. I find their contrarian takes rather regressive and self-serving.

A lot of people have already lost a lot of money speculating on crypto since 2018, because of volatility, fraud, and exchanges that turned out to have spent all their customers money. Cherry picking a specific period where you would have made a lot of money is easy in hindsight, especially since I'm pretty sure the big crash is yet to come. (I'm not sure enough to bet on a crash, but sure enough to go nowhere close t…

Its not "Cherry picking" the video is from 2018 and obviously you would compare to the current price.

Also the whole "people have already lost a lot of money" argument is totally pointless since you do not think the people who made money are relevant so why should the people who lost money be? If all of crypto is totally useless as people here keep saying then its a zero sum game and no money is lost at all it just moved around. Could it be that the people who moved it away from them are at fault?

Anywhere outside of crypto we would blame the people for their stupid actions and not "the system" after all casinos exist and HN people aren't constantly talking about how it makes people lose money.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#125

Post by [deleted] »

madsbuch wrote: post #34
paulgb wrote: post #15

Earlier quoted context omitted.

Is an insurance DAO fundamentally any different from mutual insurance? What benefit does the blockchain provide? https://en.m.wikipedia.org/wiki/Mutual_insurance

There are probably no fundamental differences like there are no fundamental difference on transportion from a horse to a car. You just have the benefit when you can drive 130kmh for hours on well maintained road infrastructure instead of riding through a forest.

[deleted]

Re: Warren Buffet and Charlie Munger on crypto in 2018

#126

Post by jqpabc123 »

noxer wrote: post #121
jqpabc123 wrote: post #36

Earlier quoted context omitted.

FedNow aims to provide *instant* and secure transfers between existing fiat bank accounts 24/7/365 at a projected cost of 5 cents per transaction. In trials now, scheduled to launch in mid-2023. The most valuable use-case for crypto was prodding the Fed to develop and implement this. If all goes as planned, consider crypto's work done. https://explore.fednow.org

5 cent per TX is actually expensive compared to some crypt solutions. Also fednow does not work outside the US currency system. You can not send USD and receive EUR. But guess what, there are actually crypto solutions that can do that faster and cheaper than any bank can today. The trick is to go over crypto to bridge different fiat currency so you can exchange USD to EUR without a third party taking a fee for the ex…

5 cent per TX is actually expensive compared to some crypt solutions.

This is projected. Actual cost to consumers will depend on banks and how they choose to recover the cost. As an example, credit card transactions are much, much higher but a lot of consumers consider them *free* because they aren't charged directly.

Yes, some crypto transactions may be cheaper --- for crypto swaps only. But crypto isn't a functioning currency. You can't rent a place to live in crypto-land. Compare apples to apples and look at the overall cost of doing an actual, end to end, real world transaction involving crypto (like paying rent) and 5 cents will start looking more attractive.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#127

Post by noxer »

pavlov wrote: post #83
kelthuzad wrote: post #11

I personally don't own any Bitcoin, but would you have bought it in 2018 you'd still be up approx. ~370% at the current dip, while you would have been profitable a whopping ~1700% at ATH. I find their contrarian takes rather regressive and self-serving.

And if you bought Enron stock in the 1990s and sold in 2000, you also made a wonderful profit. The existence of a trading opportunity (with perfect timing just assumed) doesn't tell you anything about the fundamentals. A lot of people bought Bitcoin during the late 2017 hype peak, around $17-19k. If they're still in, they're underwater on their investment now five years later. So it's not actually such a great long-t…

You just did the same "perfect timing" just in reverse.

BTW buying BTC is not an investment it is speculation.

Also 17k-19k will probably give huge returns in 3 years or so.

Its a high risk high reward bet you cant expect 100+% gains without also expecting some periods where you will be "underwater". If you aren't fine with both, long term crypto holding just isn't for you.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#128

Post by noxer »

jqpabc123 wrote: post #126
noxer wrote: post #121

Earlier quoted context omitted.

5 cent per TX is actually expensive compared to some crypt solutions. Also fednow does not work outside the US currency system. You can not send USD and receive EUR. But guess what, there are actually crypto solutions that can do that faster and cheaper than any bank can today. The trick is to go over crypto to bridge different fiat currency so you can exchange USD to EUR without a third party taking a fee for the ex…

5 cent per TX is actually expensive compared to some crypt solutions. This is projected. Actual cost to consumers will depend on banks and how they choose to recover the cost. As an example, credit card transactions are much, much higher but a lot of consumers consider them *free* because they aren't charged directly. Yes, some crypto transactions may be cheaper --- for crypto swaps only. But crypto isn't a functioni…

Its irrelevant how much it will cost in the end. Moving fiat inside the same currency space is rather trivial, its just balances on a server in the end.

Moving currencies across borders between different jurisdictions and currencies that is actually where the problems start and thus this is not cheap and not fast.

People already use crypto as a bridge currency today to transfer "functioning currency" aka fiat.

If you are in lets say Europa and you want to send money to Mexico You buy crypto send it there and sell it there for the local currency (Mexican Peso). This takes only a few minutes if done manually and you get the exchange rate of the market not some bad rate from a bank or payment provider. People do this since many years now circumventing banks and payment providers who would take a huge fee.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#129

Post by Eisenstein »

madsbuch wrote: post #110
Eisenstein wrote: post #56

Earlier quoted context omitted.

Steam engines were not designed to supplant horses as transportation, they were designed to supplant horses for work. In that regard there was effectively no lag time between their invention and their usefulness. What is it with people defending crypto with terrible metaphors?

> What is it with people defending crypto with terrible metaphors? Why do you feel the need for this type of attack?

It is frustrating that many times when someone asks a question about crypto instead of an answer there is a comparison to something else that is irrelevant using a metaphor based on a misconception.

Re: Warren Buffet and Charlie Munger on crypto in 2018

#130

Post by noxer »

yucky wrote: post #123
noxer wrote: post #115

Earlier quoted context omitted.

But there is no "house" in crypto this analogue make no sense.

Wouldn't the major exchanges be similar to "the House"?

Exchanges if run properly do not have the function of "the house".

You dont play against them and the odds are in their favor you instead play against everyone else on the same exchange and there are no odds against anyone.

The exchange gets a fee for the service it provides so it does in fact always win but by providing a service people are willing to pay for and not by favorable odds.

Also you dont need to use a centralized exchange, DEX exists too.

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