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$130B wiped off crypto markets in 24 hours

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Re: $130B wiped off crypto markets in 24 hours

#311

Post by immibis »

toufka wrote: post #240
eli wrote: post #225

Earlier quoted context omitted.

It's not backed by mathematics any more than gold is backed by chemistry.

Uh, gold _is_ backed by chemistry. If gold were to change nearly any of its chemical properties, it would instantly lose its value. It is stable, generally non-reactive, non-toxic, lustrous, and of generally low abundance - all properties derived directly from its chemistry. That is actually one of the strongest arguments, to my mind, for why some variant of a cryptocurrency will survive as a store of value. Gold kin…

Gold's value comes from being a Schelling point, not from any particular chemical properties - other than, like, not killing you or exploding.

Bitcoin is also a Schelling point.

Re: $130B wiped off crypto markets in 24 hours

#312

Post by CryptoPunk »

kkjjkgjjgg wrote: post #266
tomp wrote: post #254

Earlier quoted context omitted.

Wasn't there an article recently, that basically revealed that "from their browser/device" basically means just using the API to access the blockchain? So you're still using "a bank", just that the bank is the API provider. A bit more modern, but not a game changer.

That was perhaps about Ethereum, whose Blockchain seems to be so unwieldy that one very few companies manage to process it directly, and everybody else uses their API.

Ethereum's blockchain is not at all unwieldy - there are 5,000+ nodes.

Most companies rely on hosted nodes across the entire crypto space, not just within the Ethereum one. That has more to do with wanting a highly-reliable node provider with a low likelihood of experiencing down time, for business critical applications, than running a node being difficult.

Re: $130B wiped off crypto markets in 24 hours

#313

Post by rjmunro »

fault1 wrote: post #101
jensensbutton wrote: post #74

Earlier quoted context omitted.

I tend to think crypto currencies, much more than conventional financial assets, is sensitive to the public narrative/hype due to it being a pure speculation play. A lot of people bought in over the past two years due to the hype and I suspect if the media narrative turns a lot of folks will pull out.

I think many cryptocurrencies are on the edge of pump and dump schemes, amplified by social media. A friend of mine made a decent amount just tracking the tweets of Elon Musk and other coin influencers a few years ago.

"many cryptocurrencies"?

Which ones would you say are not?

Re: $130B wiped off crypto markets in 24 hours

#314

Post by immibis »

tim333 wrote: post #168
cuteboy19 wrote: post #151

Earlier quoted context omitted.

70% of Bitcoin holders bought in last year. A continuous stream of greater fools is necessary for its price to even remain at the current level Also, every ponzi scheme gives amazing returns, before it inevitably collapses. For example Madoff was able to give decent returns to his investors for 17 years! 'Number go up' is not a refutation of a ponzi scheme.

Yeah but with a Madoff/Ponzi scheme the thing collapses, Madoff goes to jail, it ends. Bitcoin seems more like other assets that don't make things, stuff like fiat money, gold, fine art and so on.

Yeah, it's the world's first decentralized Ponzi scheme. There's nobody to put in jail - its value just drops to 0.

Re: $130B wiped off crypto markets in 24 hours

#315

Post by immibis »

lupire wrote: post #187
tim333 wrote: post #102

Earlier quoted context omitted.

As an occasional bitcoin holder, I don't think it's a Ponzi scheme. Who's the Ponzi schemer? How come every time it collapses it comes back bigger in a year or two?

only 7Billion suckers on Earth. Pretty soon you'll need aliens to buy BTC to keep propping up the price...

Bitcoin isn't even close to reaching all 8* billion people, so this Ponzi scheme has the ability to go even higher.

Re: $130B wiped off crypto markets in 24 hours

#316

Post by immibis »

samarama wrote: post #115
khuey wrote: post #94

Earlier quoted context omitted.

The USD is backed by the power to tax 330 million people. Bitcoin is not.

That has nothing to do with its value. It’s value is in how robust it’s value it is. It isn’t robust at all and has lost 30% or more of its value since the start of the pandemic if you look at commodities.

So, in your eyes, value is proportional to the rate of change of value?

I plugged it into Wolfram Alpha and it showed some solutions. Some go up to infinity and some go down to zero. So the first guy was right after all!

Re: $130B wiped off crypto markets in 24 hours

#317

Post by immibis »

UncleMeat wrote: post #215
Demiurge wrote: post #163

Earlier quoted context omitted.

No, it doesn't. HODL equals "hold". "Buy" means make an active decision to buy, hold means make a passive not to make a decision.

Money is fungible. There is no rational difference between "continue to hold X BTC that I already own" and "buy X BTC today when I currently own 0 BTC."

Incorrect. You should not put all of your money into a single investment, according to Kelly. BUY means "the amount of this you should have according to Kelly's criterion has increased", HODL means it is unchanged.

Re: $130B wiped off crypto markets in 24 hours

#318

Post by immibis »

matheusmoreira wrote: post #123
podgaj wrote: post #88

Earlier quoted context omitted.

"to make it almost always increase in value" To any investor this should be the biggest red flag that you are in a Ponzi/pump and dump scheme. "You can't lose!" And rather than you are "buying electricity" I would say you are buying used electricity, which is useless.

It's a deflationary currency. The opposite of "USD always decreases in value because of inflation". Not a red flag at all. Even the idea that it's deflationary is debatable since exchanges now offer loans, a service which effectively creates new bitcoins out of nowhere.

Deflationary currencies cannot be deflationary forever. Think for 5 seconds: if that was true, then the person who sold the pizza for bitcoin will eventually have enough value to buy everything on the planet. So will the person whose CPU was mining to keep the pizza warm. Can there be two planets of value on the planet?

Re: $130B wiped off crypto markets in 24 hours

#319

Post by immibis »

darkwater wrote: post #219
matheusmoreira wrote: post #190

Earlier quoted context omitted.

It's not useless though. It works just fine as a currency. It's just that nobody is using it. Like how Signal is more trustworthy than WhatsApp but nobody I know uses it so it doesn't matter.

Sadly currencies rely on network effects even more than instant messengers to be really useful. The fact that most people look at cryptocurrencies just like they were stocks and comparing against a buying/selling price in USD should be pretty clear. I know that people also invest in currencies and gain money on exchange fluctuations but it's more a "side effect" than the main purpose. With cryptocurrencies is the oth…

All kinds of things rely on network effects, yet they managed to get started anyway. Reliance on network effects is not a reason to instantly dismiss something. Or else there would be no Hacker News.

Re: $130B wiped off crypto markets in 24 hours

#320

Post by immibis »

dandare wrote: post #302
soared wrote: post #224

Earlier quoted context omitted.

I’m no crypto fan but this is just incorrect. Stablecoins exist solely to be stable, look at tether.

You are right. How are they useful?

You can send them to people and/or exchange them for stuff. Which is exactly what you'd want to do with a currency.
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