Nassim Taleb: Bitcoin failed as a currency and became a speculative ponzi scheme • Hacker News Board

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

#381

Post by DonHopkins » Sat, Apr 17, 2021, 7:13 PM UTC

bitcoinmonger wrote: post #374

DonHopkins wrote: post #122

Bitcoin has spectacularly succeeded as a reliable litmus test to identify people and companies who are actually charlatans and get-rich-quick scammers with nothing better to offer than self-serving shilling and crypto-woo-woo, who contribute nothing to the world but hot air, burning coal, and global warming.

Bitcoin doesn't run on coal.

As I said, it's a reliable litmus test for detecting shills! They'll always crawl out of the woodwork to defend it with lies.

https://diginomica.com/bitcoins-damage-planet-coal-powered-c...

>Bitcoin's damage to the planet - the coal-powered Chinese phenomenon that uses more electricity than the whole of Argentina

>There's good reason for environmental campaigners and academics to worry about the effects of Bitcoin, cryptocurrencies, and Blockchain on the planet, not to mention on geopolitics and the distribution of wealth.

>However, while China is the world’s leading investor in clean energy, it remains highly reliant on fossil fuels. Indeed, between 1990 and 2019 China's coal consumption nearly quadrupled, according to US think tank the Center for Strategic and International Studies (CSIS). So the environmental impact of its electricity habit is massive.

>The CSIS estimates that coal still powers almost 58% of all Chinese electricity usage. Roughly 21% of the world’s carbon emissions came from China between 1990 and 2019, and the CSIS estimates that nearly 80% of those emissions were from coal.

>So the subtext ought to be clear: despite its promise of digital newness and disruption, Bitcoin is largely a coal-fired technology whose energy usage is soaring and its carbon footprint growing. That should be something for mega-fan Elon Musk to ponder while the world’s richest man develops his electric vehicles and plays 'billionaire bottle-toss' with space rockets.

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

#382

Post by medium_burrito » Sat, Apr 17, 2021, 7:29 PM UTC

The primary use of Bitcoin is moving money out of China. That's what drives a lot of this.

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

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Post by DonHopkins » Sat, Apr 17, 2021, 7:35 PM UTC

bitcoinmonger wrote: post #374

DonHopkins wrote: post #122

Bitcoin has spectacularly succeeded as a reliable litmus test to identify people and companies who are actually charlatans and get-rich-quick scammers with nothing better to offer than self-serving shilling and crypto-woo-woo, who contribute nothing to the world but hot air, burning coal, and global warming.

Bitcoin doesn't run on coal.

Citations?

https://www.theguardian.com/technology/2021/apr/07/china-bit...

>China’s vast bitcoin mining empire risks derailing its climate targets, says study

>China powers nearly 80% of the global cryptocurrencies trade, but the energy required could jeopardise its pledge to peak carbon emissions by 2030

>Bitcoin miner Huang inspects a malfunctioning mining machine during his night shift at the Bitcoin mine in Sichuan Province, China. China’s bitcoin mines will generate 130.5m metric tons of carbon emissions by 2024, the Nature study found.

>China’s electricity-hungry bitcoin mines that power nearly 80% of the global trade in cryptocurrencies risk undercutting the country’s climate goals, a study in the journal Nature has said.

>Bitcoin and other cryptocurrencies rely on “blockchain” technology, which is a shared database of transactions, with entries that must be confirmed and encrypted. The network is secured by individuals called “miners” who use high-powered computers to verify transactions, with bitcoins offered as a reward. Those computers consume enormous amounts of electricity.

>About 40% of China’s bitcoin mines are powered with coal, while the rest use renewables, the study said. However, the coal plants are so large they could end up undermining Beijing’s pledge to peak carbon emissions before 2030 and become carbon neutral by 2060, it warned.

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

#384

Post by DonHopkins » Sat, Apr 17, 2021, 7:52 PM UTC

asdev wrote: post #240

SturgeonsLaw wrote: post #22

That "article" doesn't add anything beyond the fact that "this guy wrote a tweet and here's what it said". Why is such low quality filler getting traction on HN? Is it because anti-crypto posts push people's buttons? Every day there is something like this posted, and like clockwork the comments are full of the same arguments both on the pro and anti crypto sides. Am I an idiot for expecting better from HN?

HN is very anti crypto, they love the echo chamber of FUD that will be disproven

More anti-shill than anti-crypto. I'm sure everyone here prefers ssh to telnet.

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

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Post by birdyrooster » Sat, Apr 17, 2021, 8:12 PM UTC

ArchD wrote: post #291

saalweachter wrote: post #279

Earlier quoted context omitted.

I'm sympathetic to the argument that Ponzi schemes inherently have a small group propagating the fraud while presenting the illusion of a real business, so describing Bitcoin as a Ponzi scheme may be technically inaccurate. If I understand the tweets correctly, Taleb, et al, are basically saying that the mining pool functions as the insiders in a Ponzi scheme, by outcome if not intent. The argument is that a Ponzi sc…

How is BTC mining a Ponzi scheme in a way that gold mining isn't? Neither require any insider information and new entities can join in the mining. In fact BTC mining has lower barriers to entry because it doesn't require license, land rights, etc.

Well for one, gold is a precious metal with great electro-conductivity properties, never rusts and can be worked at low (relatively speaking) temperatures. Kinda useful for all these chips we need and other electronics. Try to do that with Bitcoin.

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

#386

Post by iab » Sat, Apr 17, 2021, 8:14 PM UTC

wk_end wrote: post #11

iab wrote: post #3

Without (any) skin in this game, isn’t this proclamation a bit mature? The nature of Bitcoin right now seems speculative, but will that be true also when the mining phase is over?

Is the mining phase going to end before the oceans boil?

Think of all that perfectly steamed seafood

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

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Post by _heimdall » Sat, Apr 17, 2021, 8:46 PM UTC

bob33212 wrote: post #277

pyrale wrote: post #259

Earlier quoted context omitted.

Gold is stable in isolation. If you bury gold in your backyard, and dig it up 20 years later, you will still have the exact same amount of gold. The exchange rate between gold and other things won't change that. On the other hand, for btc to keep value, you need people to mine it from to the moment you buy it to the moment you sell it. This has a cost, which is currently paid by newcomers. But if btc becomes stable (…

Good point. The problem is that some people think it is a currency instead of an investment. Other people think it is an investment instead of a currency. It can't be both. Currencies have to be less valuable over time, otherwise no one would ever spend the currency. Investments have cost more overtime otherwise no would would invest. But both groups are buying and driving up the price. Also, there is a 3rd group tha…

> Currencies have to be less valuable over time, otherwise no one would ever spend the currency

The purchasing power of a currency doesn't have to change, the government manipulators could target 0% inflations just as easily as they target 2-3%.

Most modern economies are driven by debt, thats what "creates" new wealth out of thin air. The main reason we target a low, steady level of inflation is to best incentivize lending and investing in debt. If currency value is allowed to swing wildly you can't put a predictable price on future money. If currency is allowed to lose value (deflation) you are incentivized to hold onto it rather than buy up debt. Noone buying debt means noone creating money out of nothing, meaning no GDP growth unless velocity increases.

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

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Post by acjohnson55 » Sat, Apr 17, 2021, 9:17 PM UTC

corty wrote: post #354

acjohnson55 wrote: post #310

Earlier quoted context omitted.

Why? There are other stablecoins, with better reputation. Could people just switch to them?

Tether mediates a lot of the BTC/USD-exchanges. At the same time there are rumours that tether has insufficient USD backing, so if there is ever a bank run, exchanges will be unable to pay. At that point it will be too late for a tether alternative. And after the "big tether crash", regulation will be a lot harsher on exchanges and possibly all crypto currencies, which will continue to depress courses. And I really d…

Yeah, I totally get the concerns about Tether's solvency. I guess what I don't get is why Tether remains popular, as a product that isn't unique. Is it just that it's too dangerous for everyone to admit that the emperor has no clothes, because it would crash the whole system? Is it not a liquid market?

If I were sitting on a bunch of USDT, but I wanted to be holding USD stablecoins, just generally speaking, why not swap them into a different stablecoin?

Maybe another question I should be asking is what proportion of Tether is being used to collateralize leveraged long positions in other crypto assets? Maybe that's why this is a tinder box?

Sorry for all of the questions, but legitimately trying to understand what people are talking about.

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

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Post by Sammi » Sat, Apr 17, 2021, 9:21 PM UTC

paulgb wrote: post #245

Sammi wrote: post #241

Earlier quoted context omitted.

The amount of total Bitcoin is known and capped.

Yes, because the amount of inflation goes to zero over time. That doesn't mean that there's no inflation now (i.e. that new Bitcoin aren't created every day until that time). (I guess you could argue semantically that mining doesn't “create” Bitcoin but “unlocks” it or something, but it doesn't affect the dynamics I mentioned where the cost of running the network is currently subsidized by the newly unlocked Bitcoin…

The total Bitcoin supply doesn't inflate. And so your assets won't be inflated away.

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

#390

Post by anonytrary » Sat, Apr 17, 2021, 9:32 PM UTC

klyrs wrote: post #349

anonytrary wrote: post #151

Earlier quoted context omitted.

You can only transfer what's in your pocket instantaneously when the recipient is right next to you. The real value of cash is that it is able to be nearly anonymous. Venmo and other services break this anonymity. The only thing cash has on crypto is stronger anonymity.

No, bitcoin has transparency and every transaction is publicly visible. Privacy is a myth.

You clearly read my comment wrong. I said that cash is better than crypto when it comes to privacy and anonymity, which you are agreeing with, so I am not sure why you prefixed your comment with "No".