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Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

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Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#381
Oh noes, if this starts a trend, becomes widespread, and businesses start hoarding crypto tokens instead of investing in building stuff, it could cause a great depression pretty much the same way gold hoarding caused the economy to collapse in 1929.

When people, businesses and banks start hording tokens instead of investing in building and maintaining the production capacity of consumables, the ratio of value of tokens meant to buy consumables vs the actual production of consumables gets out of wack.

When the music stops, people realize that others are sitting on tons of seemingly valuable tokens but stuff to buy with them is getting scarce because capacity is not being maintained, they reverse their trade, prices of stuff go up, volatility ensues in an incredibly destructive cycle.

Too much savings being tied to tokens instead of assets that create real value is an economy wide coordination failure, a terrible Nash equilibrium. It can be hard to solve because it's a prisoner's dilemma where the first people to invest in real production are disadvantaged so everyone hoards tokens instead.

This is what central banks are designed to prevent. We don't want cryptocoins to cause another great depression like gold tied currencies did almost a hundred years ago.

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#382

Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. It feels like this is where all the "how to get rich quick" book writers and other hustle bros went and created one giant financial pyramid, which works in quite simple way: - buy bitcoin - tell everyone around how revolutionary it is, so they buy it and what you holding increases in va…

There are practical reasons that getting rid of currency - or money I assume you mean - is a bad idea. It would be much more difficult to exchange goods and services if we had to barter for instance. But perhaps you have some alternative in mind that I haven't thought of.

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#383
post #344
post #242

Earlier quoted context omitted.

The thing I've learned investing so far: never sell anything . It really only ever makes sense to sell if doing so will positively change your lifestyle, or you have no alternative. Examples of when selling might be a good idea are buying a house, retiring, going through hard times, loss of a job etc. Rebalancing is fine too, but I'd personally only bother to do that if your portfolio is massively distorted (like it…

Noo, you should not hodl something forever just because you bought it and it's precious to you. The thing about investing and stock market in general is, that people are constantly seeking the _best_ returns. If you have invested in something and it goes up by 10% in a year while a similar asset goes up 50%, you should probably re-evaluate your investment. I have noticed that companies and investments do roughly divi…

Just have to be careful that you aren't thrashing around and exchanging investments to quickly. For one thing, the tax drag, and secondly, I've put money into a variety of things and then taken it out, only to see the stock triple in value (various EV, certain companies after IPO)

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#384
post #344
post #242

Earlier quoted context omitted.

The thing I've learned investing so far: never sell anything . It really only ever makes sense to sell if doing so will positively change your lifestyle, or you have no alternative. Examples of when selling might be a good idea are buying a house, retiring, going through hard times, loss of a job etc. Rebalancing is fine too, but I'd personally only bother to do that if your portfolio is massively distorted (like it…

Noo, you should not hodl something forever just because you bought it and it's precious to you. The thing about investing and stock market in general is, that people are constantly seeking the _best_ returns. If you have invested in something and it goes up by 10% in a year while a similar asset goes up 50%, you should probably re-evaluate your investment. I have noticed that companies and investments do roughly divi…

I've noticed the same, and I find it kind of amusing because it is basically the opposite of the common advice of periodically "rebalancing" your portfolio

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#385

Here is the key paragraph from todays 10k. It also mentions gold related assets. ( https://www.sec.gov/Archives/edgar/data/1318605/000156459021... ): "In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity. As part of the policy, which was duly approved by the Audit Commit…

You’ll notice that even if they accept Bitcoin as payment, they’ll never price anything in Bitcoin. Nobody does that. They always price it in dollars and accept Bitcoin at the market rate. When people start pricing things I’m Bitcoin without doing some daily calculation, that’s when you know it’s serious.

Do people price things in gold? So, is gold not a serious thing?

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#386

Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. It feels like this is where all the "how to get rich quick" book writers and other hustle bros went and created one giant financial pyramid, which works in quite simple way: - buy bitcoin - tell everyone around how revolutionary it is, so they buy it and what you holding increases in va…

Initially it was meant to be used as currency, but it's become more of an asset class now, mainly used as a store of value, similar to gold. Do you know how difficult it is to get millions of people to agree that something is a store of value, not only agree, but to put their money where their mouth is? THIS is why bitcoin is where it's at.

At least you can build useful things out of gold

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#387

Earlier quoted context omitted.

Fiat currency is fundamentally more speculative IMO because the value is more based on government trust that something not man-made.

Maybe in theory but not in practice. Just look at the past 10 years, btc &co are 100% driven by hype and speculation and still have 0 real world usage besides being a (semi)rich people toy and a good way to launder money / buy illegal shit online.

Bitcoin is a _terrible_ way to launder money. Not only are the onramps/offramps not anonymous - but it has so much attention that entire federal task forces are setup for $30k buy-and-busts

You'd use bitcoin for money laundering if you want to stand out and get caught. There's still nothing better than the tried-and-tested old cash, casino junket, money exchange and/or import/export businesses to launder money.

There's a reason why the most recent crop of darkweb drug markets have switched almost entirely to Monero

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#388
post #249

Cryptocurrency is a blind spot where Hacker News’ normal optimism towards innovation has disappointed for a decade. May this thread be one we can reference years later as another example of “our collective opinions can be very wrong about technologies that were transformative in hindsight.” Innovators, follow regulations and go for it. Don’t let the HN crowd get you down. Few of these commenters have ever been unbank…

What exactly is the bull case for bitcoin? I have not seen it clearly explained. I’ve got an open mind. In more specific terms you mentioned the unbanked. How does crypto solve the problems that leave them unbanked?

Michael Saylor pulled the same move six months ago and explains it really well. Highly recommend watching any of his interviews. The one with Preston Pysh is particularly enlightening.

Essentially bitcoin is a really good store of value with superior monetary properties to all other assets. If you want to store wealth for a hundred years there's nothing better. Even gold has 2% devaluation per year and has custodial risk, whereas bitcoin has no devaluation (21M supply cap), is easy to self-custody, and is very secure (high energy use/decentralized).

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#389

Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. It feels like this is where all the "how to get rich quick" book writers and other hustle bros went and created one giant financial pyramid, which works in quite simple way: - buy bitcoin - tell everyone around how revolutionary it is, so they buy it and what you holding increases in va…

> Then they buy into all of the cryptocurrency platitudes wholesale without stopping for a moment to critically evaluate it.

Go ahead then, I would genuinely like to hear your critical evaluation since you just shit all over the Bitcoin whitepaper without any actual critique in your post.

I don't understand the extreme polarization of Bitcoin on HN. It's a very interesting tech and it's still early in the adoption phase and the space is still evolving.

Re: Tesla buys $1.5B in Bitcoin, may accept it as payment in the future

#390

I don't understand all the Crypto hate on this site. Since when have hackers become the luddites to new ways of finance?

Right? Back in 2016/2017 it seemed more open. There was discussion about technology. I remember quite a bit about Bitcoin and blockchain, Ethereum, smart contract platforms etc. There's been a lot of technical innovation in these areas. Ethereum has a real product in DeFi nowadays and there's been some really amazing technical achievements. With Ethereum's move to PoS it will put the argument of energy consumption behind us and then the merits of having a distributed worldwide computation system might get talked about again. I don't get the hate now. Maybe people are just holding backs and are bitter about it
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