Is There a Cryptocurrency Bubble? Just Ask Doge • Hacker News Board

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#41

Post by aml183 » Sun, Sep 17, 2017, 3:59 AM UTC

I have great respect for Kevin Roose, but this was a disappointing piece. Dogecoin was a meme. It gained popularity and is still worth something. Jackson Palmer might not believe it has value, but clearly, there are people who own Doge that think otherwise.

There is definite frothiness in the market. Some token sales are scams, some are overpromising, and some that look promising will probably blow up. Take a look at SEC Fraud statistics for 2016. Crypto scams are a small fraction of these crimes: https://www.sec.gov/news/pressrelease/2016-212.html

Reporters need to separate Bitcoin, Ethereum, Litecoin (and some of the other older cryptocurrencies) from token sales and other crypto assets. Bitcoin has existed for 9 years and has real users with real use cases (remittance & cross-border payments)

I can keep going, but reporters really need to make an effort to do more research and separate fact from fiction (I guess this can be said for many areas of journalism though).

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#42

Post by adamnemecek » Sun, Sep 17, 2017, 4:00 AM UTC

craigc wrote: post #6

I think there is a difference between a cryptocurrency bubble and an ICO bubble, and this article fails to distinguish between the two. You can see Tom Lee, a financial strategist, talk about Bitcoin here: https://www.cnbc.com/2017/09/15/bitcoin-could-surge-another-... He points out that there are only 300,000 Bitcoin wallets that hold $5,000 or more. In the grand scheme of things that is very small compared to the o…

> It is worth nothing that JP Morgan bought up millions of dollars worth of Bitcoin after the price crashed following that statement

The crash was mostly independent of Dimon's statements.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#43

Post by srj » Sun, Sep 17, 2017, 4:02 AM UTC

madamelic wrote: post #15

jdormit wrote: post #4

> A group of Bay Area programmers this year used an I.C.O. to raise $35 million for their project, an anonymous web browser called Brave As in Brave, the new browser from Brendan Eich (founder of Mozilla, famously invented JavaScript in 10 days)? Hardly a scam... Either the reporter didn't do their research or twisted the facts to fit their story.

>Either the reporter didn't do their research or twisted the facts to fit their story. It is quite obvious it is both. - Dogecoin creator was always a cryptocurrency skeptic. The article even admits it but papers over it. - Blockchain =/= Bitcoin. The article insinuates that any blockchain-related startups are built on top of Bitcoin. - ICOs =/= Bitcoin. - "early adopters often used it to buy drugs, weapons, or other…

The NY Times recently restructured their reporting operations in a way that reduced the amount of fact-checking done[1]. FWIW I'm a daily reader and definitely feel the quality has suffered.

[1] https://www.poynter.org/news/new-york-times-copy-desk-top-ed...

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#44

Post by teuna » Sun, Sep 17, 2017, 4:03 AM UTC

aboodman wrote: post #37

subroutine wrote: post #23

Earlier quoted context omitted.

Noob question... What is the "product" that underlies the value of cryptocurrency that is so much more valuable than what underlies an ICO? What is the value of a machine churning hashes? It seems like the value is underlied by securing a transaction ledger + an arbitrarily difficult math problem. So is the value the security of the ledger?

The utility is a way to send value ~instantly, ~anonymously, relatively inexpensively, and irrevocably from one side of Earth to the other, without any intermediaries. That hasn't existed before.

Shouldn't we consider telecom operators / internet service providers intermediaries?

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#45

Post by dogruck » Sun, Sep 17, 2017, 4:09 AM UTC

fwdslash wrote: post #36

dogruck wrote: post #31

Earlier quoted context omitted.

Agreed. It's too bad there aren't effective mechanisms to go short though, so people who think we're at a peak can back their view with money.

What are you talking about? Also every exchange out there will let you short any number of cryptocurrencies.

I do not personally believe the bitcoin markets will function properly for the shorting mechanism to pay off in interesting scenarios.

If I borrow your bitcoins, how will you force me to sell them? If we agree that a third party will warehouse those coins, how can I trust them? And if BTC plunges, who's to say that 3rd party will still operate?

All very different from shorting a stock.

But if you want to loan me your bitcoins, let's talk!

I'm also interested in borrowing any other bearer instrument that you possess? (Now thinking of bearer bonds in the movie Heat)

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#46

Post by brownbat » Sun, Sep 17, 2017, 4:10 AM UTC

Coins could be useful for many ends, some dubious and some benign. Criminal purchases, inflation hedging, remittances, tax avoidance, online transactions, payments between friends, store of value / speculation. Any one of these could be affecting its value.

I often wonder though if Cryptocurrency's killer app is just capital flight from China, with every other use case just so much noise.

While that toy theory may seem reductive, it's miles more explanatory than the models offered by either the 'bubble' or 'will soon replace global financial system' camps.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#47

Post by craigc » Sun, Sep 17, 2017, 4:12 AM UTC

subroutine wrote: post #34

craigc wrote: post #29

Earlier quoted context omitted.

That is a very good question. I didn’t do a good job making an argument for why I think the value of a currency like Bitcoin could be so much higher than an altcoin that did an ICO. In my opinion, Bitcoin has the first mover advantage in this space. It was the first real use of the blockchain, is still the gateway to pretty much every other crypto currency, there is a maximum supply of coins, and is one of the only c…

That's interesting. I have so many follow-up questions but I gotta head out to dinner. Time for just one... if you're saying ICO company coins are worth sand - and the value of Etherium is as a platform for ICO companies. That seems like the definition of a bubble. No?

Well, you could certainly draw that conclusion and make that argument, but I like to think of it as investing in the internet vs. investing in pets.com during the dot-com bubble.

As of right now, you are right. The entire crypto market is speculative. I think a platform like Ethereum has a better chance of being valuable than a random token that someone with no blockchain experience put together a whitepaper for in a few days and then launched an ICO for.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#48

Post by perpetualcrayon » Sun, Sep 17, 2017, 4:12 AM UTC

The real "value" in cryptocurrency IMO is public-key encryption, which everyone on the internet already uses every day for free.

The blockchain idea is novel, but I think way less valuable than the hype has led us to believe.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#49

Post by craigc » Sun, Sep 17, 2017, 4:16 AM UTC

adamnemecek wrote: post #42

craigc wrote: post #6

I think there is a difference between a cryptocurrency bubble and an ICO bubble, and this article fails to distinguish between the two. You can see Tom Lee, a financial strategist, talk about Bitcoin here: https://www.cnbc.com/2017/09/15/bitcoin-could-surge-another-... He points out that there are only 300,000 Bitcoin wallets that hold $5,000 or more. In the grand scheme of things that is very small compared to the o…

> It is worth nothing that JP Morgan bought up millions of dollars worth of Bitcoin after the price crashed following that statement The crash was mostly independent of Dimon's statements.

Yeah I should have made that clear. The price had already started a correction, and the crashing was more associated with uncertainty related to Bitcoin exchanges in China shutting down, but his statement certainly didn’t help. It was picked up by pretty much every news outlet.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#50

Post by noddy1 » Sun, Sep 17, 2017, 4:20 AM UTC

I was a longtime ethereum sceptic, however I was guilty of being a cynical old curmudgeon; the type that poo-poo's anything and everything novel on the grounds that I'll be right 95% of time, ignoring the fact that I'll poo-poo everything that will ever change the world.

Bitcoin made currency decentralised and permissionless.

Ethereum has made capital raising and equity holding decentralised and permissionless. Sure, lots of people talk about SEC compliance, but in reality anyone can raise equity for anything now. You can issue a token to fund for a drugmarket if you wish, and pay dividends, and noone can stop you really. The market cap of ethereum is 22 billion.. is that to high or too low for the promise of permissionless securities?