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Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

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Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#161

Post by prepend »

timoth3y wrote: post #61

I know it's a losing battle, but I can't help but tilt at this particular pedantic windmill. Not all financial scams are Ponzi schemes. Most are not. Ponzi schemes involve shady bookkeeping by the operator that conceals the source of fake profits. If Bitcoin were an actual scam (and I don't think it is) it would be a pump-and-dump. Most ICOs were clearly pump-and-dumps. There is a huge variety of financial scams, and…

The key characteristic of Ponzi schemes, I think, is that there is no real value and returns are paid based solely on new cash coming in. There’s shady bookkeeping only as an artifact to hide the cash-in/cash-out structure.

I think this applies to Bitcoin because it’s payouts are solely based on speculation and new cash coming in.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#162

Post by baq »

McScroogy wrote: post #155
matkoniecz wrote: post #117

Earlier quoted context omitted.

There is not such thing. Every single thing can lose its value. In addition: Real estate can be bombed in a war or confiscated[0] and is not mobile for obvious reasons[1]. Gold can be stolen, confiscated - and it happened already more than once. Companies can go bankrupt. Items - either productive like machinery or various stores of value like art are not immune. Cash/bank accounts - well, money printing will get you…

I thought as much. I suppose some things are riskier than others, but at the moment I really don't know which ones.

risk always changes. you should be constantly reviewing and updating your exposure according to your risk assessments. (for some, this is daily; for others, once a year may be enough.) if you don't want to do the work - understandable, since it's an impossible amount - you might want to start from looking at the bond market. this is what they get paid for. (not saying that you should be buying bonds - but look at relative price of bonds)

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#163

Post by baq »

dmichulke wrote: post #113
McScroogy wrote: post #108

Earlier quoted context omitted.

Could you point me to an alternative investment that can not lose its value, please?

Gold maybe. But gold is not a currency either, so hmmm. In all earnest, I wonder when the mainstream will realize that in a digital world the store of value and a currency can be different because they are easily interchangeable. Just like bonds or gold for long term investment (store of value) and dollar (currency).

paper gold trades like a currency, bitcoin trades like a commodity.

gold - the real thing - i guess you should have some, but this is more like insurance than asset, don't ever sell unless the world is ending stuff.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#164

Post by atweiden »

meowkit wrote: post #91
atweiden wrote: post #83

Earlier quoted context omitted.

We’ve been constantly hearing about the importance of “innovation” in the cryptocurrency space. Meanwhile, Dogecoin hits $50B after having been all but dead for a solid decade. Makes you wonder just how important Defi’s so called “innovation” is to its valuation, and how much of it is just a narrative.

Its been a single week of pumping. Dogecoin has not been around for a decade. The sarcasm around innovation is unwarranted.

“One week of pumping” isn’t true at all: DOGE originally broke into the top 10 list off the back of the GME hype several weeks ago. This is now the second time it’s happened. In addition, DOGE has undeniably flippened numerous B-rate defi coins throughout its very illuminating run.

Importantly, DOGE clearly shows innovation isn’t necessary for a coin to receive a sky high valuation. Dogecoin at c. 7.5 years old is about as old as any other coin I can remember, and it’s been all but dead for that entire length of time. Now suddenly DOGE is more valuable than the great majority of coins which have been historically propped up by generous amounts of drum beating — e.g. “wow, such innovative”.

What does that tell you about the importance of innovation in cryptocurrency valuation?

Either these coins never needed to innovate in the first place, or all the purported “innovation” drum beating by biased defi investors has always been nothing more than empty rhetoric.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#165

Post by chewz »

matkoniecz wrote: post #117
McScroogy wrote: post #108

Earlier quoted context omitted.

Could you point me to an alternative investment that can not lose its value, please?

There is not such thing. Every single thing can lose its value. In addition: Real estate can be bombed in a war or confiscated[0] and is not mobile for obvious reasons[1]. Gold can be stolen, confiscated - and it happened already more than once. Companies can go bankrupt. Items - either productive like machinery or various stores of value like art are not immune. Cash/bank accounts - well, money printing will get you…

> [0] For "real estate will never go down in value" fans:

You realise that these properties in the picture (Plac Defilad right in the centre of Warsaw) are worth a lot nowadays. And descendants of the original owners get compensated (the land had been confiscated after WW2 by communist government). So I would rather say that real estate could be illiquid with temporarily depressed prices occasionally.

https://pl.wikipedia.org/wiki/Plik:Panorama_ul._Emilii_Plate...

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#166

Post by not_kurt_godel »

throw0101a wrote: post #32
sebmellen wrote: post #14

What's more concerning to me is the cryptocurrency market as a whole. Perhaps there is an argument to Bitcoin being a kind of "digital gold" even if it is all but useless as a currency. But events like Dogecoin hitting a $50B market cap are very unsettling to me. I used to take part in "Dogecoin Socks for the Homeless" events. It was wonderful, everyone was trying to make something good out of what we all knew to be…

> Perhaps there is an argument to Bitcoin being a kind of "digital gold" even if it is all but useless as a currency. Gold is less useful than most people think: > In a 2012 paper entitled "The Golden Dilemma",[1] Claude Erb and Campbell Harvey examined some common assumptions about gold. First they looked at gold as an inflation hedge, analyzing gold returns from 1975 (the year the U.S. came off of the gold standard…

https://en.wikipedia.org/wiki/Group_11_element#Applications

> These metals, especially silver, have unusual properties that make them essential for industrial applications outside of their monetary or decorative value.

Sounds special to me. There are lots of things we would make out of gold and silver if they were more common. Gold has quite a bit of inherent value independent of cultural accidents regarding beauty.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#167

Post by prepend »

rektide wrote: post #34

I want to agree, but I have to confess, I don't think currency necessarily has to be cheap nor fast to use. For example, there are Rai Stones[1] or Yapese stone money , which can require more than one person to move in some cases. They're not really currency per se, so it only sort of counts. But I feel like I have to allow currency with different behaviors & characteristics than the cash we all know. I do think ther…

Those currencies sucked. Pointing out other terrible currencies once existed in dead civilizations doesn’t quite help with the argument that currently doesn’t need to be easy to use.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#168

Post by tom_mellior »

sub7 wrote: post #141

Just wait until people realize the stable coins are not stable either. There's 1000 or so entities that control 50% of circulating btc. These insiders run the game, they have more information than you and they control the very few exits out there so you cannot really win without being extremely lucky. Everyone thinks they are smart enough to get out before the next idiot, there's no universe where this ends well for…

Many many people have already gotten out, with things ending brilliantly for them. Out of being smarter? No, through pure dumb luck. But this notion that "the average person who holds forever can't win, ergo nobody can win" doesn't make your analysis look particularly insightful.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#169

Post by jacquesm »

So, now we know Nassim Taleb missed the crypto boat. As did I and many others. Because if he didn't he wouldn't have posted this.

And what nonsense. "A currency must earn interest" It's perfectly possible to lend your bitcoins to someone and generate a return on it, that's what contracts are for and has nothing to do with the currency itself.

Coming soon: one NT's own crypto coin.

Re: Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme

#170

Post by chii »

Kranar wrote: post #42
GhostVII wrote: post #35

What I want is an inflationary cryptocurrency, not a deflationary one. Make an actual currency, not something to speculate on.

If you want something inflationary, why not a basket of currencies via the traditional finance system? One reason I like Bitcoin is because it's a deflationary asset which makes it unique among most other assets. This site is overwhelmingly negative towards Bitcoin, but I feel like the negativity would only make sense if you had to make a binary decision to put most of your wealth in Bitcoin or none of it. Having jus…

> some crazy trade-conflict or other global unforeseen event

if that event happens, either it doesn't affect you that much, or it affects you so much that bitcoin will not help.

There's no scenario in-between those two, for which i can see bitcoin be the rescuing currency.

Unless you're not in the developed world of course - like in venezuela, or turkey (likely to start to hyperinflate due to mismanagement from their central bank). In that case, bitcoin makes perfect sense to own.

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