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What I Think of Bitcoin

bridgewater.com

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Re: What I Think of Bitcoin

#131

Post by coinward »

dandanua wrote: post #42

I think it's time to put Bitcoin on the ignore list. You will never learn anything new about it, only the same stories: 1. It's a disastrous waste of energy resources. 2. HODLers like to compare it with gold and use it as a store of value. Because of this, they will constantly make a noise about it to raise its price. 3. No one will ever use it as an ordinary currency to buy simple things. Oh, you could buy Tesla wit…

Have fun staying poor. Ignoring technology that is disrupting money, one of the primary tools driving human progress, is foolish at best.

Re: What I Think of Bitcoin

#132

Post by hankthecat »

PaulHoule wrote: post #2

90% of the time Ray Dalio has an interesting opinion and good analysis, and he does this here. I did an analysis based on the same premise (Bitcoin competes with gold) and came to basically the same conclusion. Dalio's writings about how the "All Weather" fund works are based on a premise a lot like the "Permanent Portfolio" advocated by Libertarian presidential candidate Harry Browne but Dalio took out the "gold" co…

dropping interest rates had everything to do with it. the 10yr treasury was at 6% in 2010 and now it's at 1.15%. your TIPS did well because rates dropped. Also those are mostly paper gains unless you sell...

fyi the "all weather" portfolio's name is stupid given it's mostly backward looking and benefited from a commodities supercycle and rates dropping from QE. With the 10yr at 1% putting 30-40% of your portfolio in long dated treasuries is insane. Let's use the TLT etf as an example (20 yr treasury). It has a duration of 19 years. That means for every 1% increase increase in rates, the value of your bonds will go down 19%....yikes. Let's say you are going to buy individual bonds and hold to maturity. Ok, you are protected from that price drop assuming you don't sell, but you've also just made a 20 year bet you don't think interest rates will go higher from here.

Re: What I Think of Bitcoin

#133

Post by budlightvirus »

babyshake wrote: post #113
lalaland1125 wrote: post #24

This post should be mostly discounted because Ray doesn't really seem to be aware of the true risk of the Tether scam, the biggest component of and risk to Bitcoin's value. For those not aware, Tether is a "stable coin" that issues tokens that supposedly represent dollars and can be used as a medium of exchange. However, it's widely suspected that Tether is unbacked and printing fake dollars and even Tether itself ha…

If there is one argument that convinces me that Tether is unlikely to present an existential risk to Bitcoin, it's that some of the largest companies are supporting Bitcoin, adding it to their balance sheet, etc. I've got to believe they are well aware of this risk and have looked into it, and have at least decided that it isn't a large enough issue to expose them significantly.

Enron and Lehman Brothers were both sizable enterprises

Re: What I Think of Bitcoin

#134

Post by HourglassFR »

CyberDildonics wrote: post #58
lalaland1125 wrote: post #24

This post should be mostly discounted because Ray doesn't really seem to be aware of the true risk of the Tether scam, the biggest component of and risk to Bitcoin's value. For those not aware, Tether is a "stable coin" that issues tokens that supposedly represent dollars and can be used as a medium of exchange. However, it's widely suspected that Tether is unbacked and printing fake dollars and even Tether itself ha…

Everyone who invests in bitcoin is breaking the cardinal rule of investing: don't invest in something you don't understand. If people realized that bitcoin's -average- transaction fee is around $25 USD because it is restricted (for no technical reason) to a few transactions per second (less throughput than 240p youtube videos) they would at least move on to other cryptocurrencies. If people realized that a sudden dro…

> If people realized that a sudden drop in price will mean a sudden drop in mining power, which will mean a sudden drop in blocks being generated, which will mean a sudden drop in throughput, they might be even more eager to get out of it.

I agree with your overall argument but as I understand it, this is false. If the mining power of the whole network drops, the proof of work will become simpler so as to have a roughly constant block throughput. Or am I missing something here ?

Re: What I Think of Bitcoin

#135

Post by Mc_Big_G »

CyberDildonics wrote: post #78
Mc_Big_G wrote: post #61

Earlier quoted context omitted.

The value of Bitcoin doesn't lie in how many transactions it can do per second, nor the cost per transaction.

I actually said utility, you said value. It is also telling that you didn't say what the value actually is. If you do explain that, make sure to mention it relative to other cryptocurrencies that have all the same properties (except for name recognition) but don't have throughput problems because they did what everyone saw coming 8 years ago and allowed larger blocks, faster blocks, or both.

Ok, I'll bite. Bitcoin has a large, distributed network of miners and exchanges who support it, has extremely low inflation approaching zero, has a supply cap of 21 million, is infinitely divisible, has been in the wild for 10 years with zero hacks, can transfer unlimited value (billions/trillions) anywhere in the world for relatively low costs in relatively low time compared to traditional system, and does not require any third-party middle man to approve the transaction, is accessible to anyone in the world regardless of regional laws, and cannot be printed or inflated artificially. I'm sure there's more.

In regards to value relative to other crypto, this is a valid point but ultimately doesn't matter at all. Why does Craigslist still make 100s of millions of dollars every year when it is clearly an inferior product?

Re: What I Think of Bitcoin

#136

Post by coinward »

kaycebasques wrote: post #53

MacroVoices #255 with Mike Green discussed another regulatory threat not mentioned in the Bridgewater post. Governments don't have to ban BTC outright. They have other tools for making it wildly unattractive to hold. I can't remember the details but they discussed a scenario where the US government classifies BTC as a commodity and requires K-1 style taxation. That would mean that you would have to pay taxes on any g…

How will they confiscate those BTC gains? They are literally relying on an honor system to report holdings today. Maybe this will change and they will come after those who are suspected to be holding BTC due to purchase records from KYC compliant services that IRS could get their hands on. Then what? Show up with their guns to coerce you or throw you in a cage until you fess up? The tax code mess becomes totally impossible post hyperbitcoinization. Bitcoin frees the tax slaves. You thought abolition was just for history books?

Re: What I Think of Bitcoin

#137

Post by jeffreyrogers »

hjek wrote: post #11

Nathan Robinson did a great piece[0] on Ray Dalio's principles and Bridgewater's culture, which looks extremely toxic: > Make sure, of course, that you always make specific people feel bad about mistakes: “Instead of the passive generalization or the royal ‘we,’ attribute specific actions to specific people: ‘Harry didn’t handle this well.’” And make sure everyone knows it: “Use ‘public hangings’ to deter bad behavio…

I worked at Bridgewater, and while there are things I disliked about it, this piece is not at all fair and does not capture what it is actually like to work there. Nathan Robinson, who is a self described socialist, is not someone I would go to for an objective assessment of a hedge fund's working conditions.

Re: What I Think of Bitcoin

#138

Post by [deleted] »

colincooke wrote: post #14
learnstats2 wrote: post #6

Here Ray Dalio says he views Bitcoin as a gold-like asset. This is the first time I have felt that Bitcoin has some value: as a commodity that wealthy people put their wealth into when they have nothing better to do with it. People are not buying gold because they ever plan to use the gold.

I agree, there was a nice article in the economist about this concept (bitcoin as a store of value) [0]. More specialized than gold, investors have realized that bitcoin acts as a great hedge on uncertainty. When the market is uncertain to it's future (initial lockdowns for example) bitcoin goes up. It also goes up for less direct reasons (at least that I'm aware of). This makes it a less than ideal traditional store…

[deleted]

Re: What I Think of Bitcoin

#139

Post by coinward »

_han wrote: post #76
gegtik wrote: post #62

"environment" 2 hits, both "regulatory environment"

I went one step further and searched for "energy", which only appeared in the article's disclaimer in names of institutions. I then proceeded to close the browser tab.

so you will only read content that confirms your belief that Bitcoin wastes energy? I see. Have fun staying poor.

Re: What I Think of Bitcoin

#140

Post by Consultant32452 »

kaycebasques wrote: post #53

MacroVoices #255 with Mike Green discussed another regulatory threat not mentioned in the Bridgewater post. Governments don't have to ban BTC outright. They have other tools for making it wildly unattractive to hold. I can't remember the details but they discussed a scenario where the US government classifies BTC as a commodity and requires K-1 style taxation. That would mean that you would have to pay taxes on any g…

I agree with you 100%. The phrase I like to use is "friction". All the central banks/governments have to do is apply some friction and it will stop BTC from becoming a defacto currency. They have already started by calling BTC an asset. This means if you get some bitcoin and then spend it, you have to log that on your taxes as capital gains/loss. This is already going to be too troublesome for regular people. They killed BTC and the crypto community doesn't even know it.
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