Bitcoin has few attributes of money but all the attributes of a collectible • Hacker News Board

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#41

Post by throwaway81523 » Thu, Apr 22, 2021, 5:19 AM UTC

Ansil849 wrote: post #15

As a casual observer I see the cryptocurrency space only seriously used by two groups of people: those who want to buy goods/services which are controlled in their or the seller's jurisdiction and so need a bit more anonymity than Paypal; and people who run ICO and more recently NFT swindles. I have yet to see a widespread other usage of cryptocurrency.

I don't use bitcoin but one attraction I see is that it lets you spend your money without anyone else's permission. If you buy something with it, the seller gets the money without your having to worry about automated fraud checks causing your credit card to be declined, check to be put on hold, etc. It's like cash that way. Wire transfers might be an alternative, but they are only practical for fairly large transactions and involve a lot of bureaucracy.

Of course bitcoin (like cash) limits your recourse against the seller, so you have to take that into account. Sometimes though, that is to your advantage when the risk is low enough (small transaction, trusted seller) that the hassle avoidance outweighs the risk.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#42

Post by fny » Thu, Apr 22, 2021, 5:20 AM UTC

paxys wrote: post #38

The explanation I have seen works best for a non-technical audience is – Bitcoin is digital gold, and there is a global ledger which automatically tracks who owns how much of it. There is a finite amount of it out there, and it has to be "mined". There is nothing that makes it different from any other "coin" or really any other combination of bits (just like gold isn't unique among all the elements in any way), but i…

> No country or central government decides how much gold is worth

This is true today. It was not true in the US 50 years ago. It does not need to be true tomorrow.

The government can put ceilings and floors in the price of all things just as easily as Turkey banned crypto.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#43

Post by dnautics » Thu, Apr 22, 2021, 5:20 AM UTC

handmodel wrote: post #39

dnautics wrote: post #35

Earlier quoted context omitted.

> If everyone suddenly switched to believing “Oh bitcoin doesn’t do anything but it is a fun collectible which also has mining costs to track ownership” its value would plummet. That's generally true for all currencies. If everyone suddenly switched to believing "X-sovereign-currency" doesn't do anything but legitimizes that sovereign and has military and human rights costs to maintain the illusion of that legitimacy…

> their value is in your head, or at the tip of the gun, or because you can pay taxes in it or get sent to jail. These all seem very real. And not something that will disappear (or even drop) if media attention or nerd interest moves elsewhere.

it's not like currencies haven't died before due to international boycott. And even internally there is a breaking point at which a sovereign that loses the confidence of its people is helpless.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#44

Post by _9omd » Thu, Apr 22, 2021, 5:20 AM UTC

syllable_studio wrote: post #9

I don't agree with this assessment at all. I think the immense value of bitcoin and other technologically advanced, secure, decentralized networks comes from the detailed network communications which they enable. They allow global financial transactions through a powerful medium in a way that has never existed before. This has nothing to do with baseball cards. The fact that decentralized networks enable NFTs and col…

Exactly, cryptocurrency is a powerful human coordination tool that allows us to build networks that contain real monetary value on top of legacy infrastructure. I'm not surprised to see this on the front page, hacker news has taken misrepresenting Bitcoin to a professional level.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#45

Post by Ansil849 » Thu, Apr 22, 2021, 5:21 AM UTC

throwaway81523 wrote: post #41

Ansil849 wrote: post #15

As a casual observer I see the cryptocurrency space only seriously used by two groups of people: those who want to buy goods/services which are controlled in their or the seller's jurisdiction and so need a bit more anonymity than Paypal; and people who run ICO and more recently NFT swindles. I have yet to see a widespread other usage of cryptocurrency.

I don't use bitcoin but one attraction I see is that it lets you spend your money without anyone else's permission. If you buy something with it, the seller gets the money without your having to worry about automated fraud checks causing your credit card to be declined, check to be put on hold, etc. It's like cash that way. Wire transfers might be an alternative, but they are only practical for fairly large transacti…

That's a potential use, one of many, but it is not a current widespread use of crypto. Why? Probably because Paypal (despite its many, many faults) works just fine for most people.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#46

Post by brbsix » Thu, Apr 22, 2021, 5:22 AM UTC

thesausageking wrote: post #11

This doesn't make any sense. That's a poor definitely of money. And Bitcoin does not have "all of the elements of a collectible". Collectibles have cultural, artistic, or other value on their own and are limited numbers of a set ("non-fungible"). Bitcoin is very fungible. If you own 2 BTC, there aren't specific Bitcoins that are marked for you.

    If you own 2 BTC, there aren't specific Bitcoins that are marked for you.

If you mine 2 BTC, you posses the private keys to two very specific BTC (unspent outputs) on the blockchain. No one else may spend them without the private keys.

If you own 2 BTC in an exchange then it is true that you are unlikely to own any specific 2 BTC but that's an entirely different subject. At that point you don't really own them.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#47

Post by dehrmann » Thu, Apr 22, 2021, 5:22 AM UTC

thesausageking wrote: post #11

This doesn't make any sense. That's a poor definitely of money. And Bitcoin does not have "all of the elements of a collectible". Collectibles have cultural, artistic, or other value on their own and are limited numbers of a set ("non-fungible"). Bitcoin is very fungible. If you own 2 BTC, there aren't specific Bitcoins that are marked for you.

> Collectibles have cultural, artistic, or other value on their own

Interest or novelty, perhaps, but not value. There's a big difference between a baseball used in a game and a baseball card. NFTs show this distinction a bit better because, like baseball cards, they're only loosely associated with the person or thing that's actually culturally interesting.

> Bitcoin is very fungible.

As others have said, there's a record of your bitcoin's life, but there are also a fixed number of bitcoins.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#48

Post by danjac » Thu, Apr 22, 2021, 5:25 AM UTC

graeme wrote: post #7

The funny thing is that Bitcoin will basically only have value as a collectible as long as substantial numbers of people believe this essay’s argument is false . People want to collect bitcoin at current valuations because they are convinced it will become a currency/store of value of the future and hence rise in value. If everyone suddenly switched to believing “Oh bitcoin doesn’t do anything but it is a fun collect…

> The funny thing is that Bitcoin will basically only have value as a collectible as long as substantial numbers of people believe this essay’s argument is false.

Is this the "greater fool" argument against Bitcoin?

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#49

Post by dehrmann » Thu, Apr 22, 2021, 5:26 AM UTC

syllable_studio wrote: post #9

I don't agree with this assessment at all. I think the immense value of bitcoin and other technologically advanced, secure, decentralized networks comes from the detailed network communications which they enable. They allow global financial transactions through a powerful medium in a way that has never existed before. This has nothing to do with baseball cards. The fact that decentralized networks enable NFTs and col…

You're conflating the value of blockchains with the value of bitcoin. A bet on bitcoin is a bet that more people will want bitcoins, so the price goes up. This trades a lot like baseball cards that random drug dealers also accept. A bet on blockchain tech is that someone finds a use case for it that isn't a solution in search of a problem.

Re: Bitcoin has few attributes of money but all the attributes of a collectible

#50

Post by zbraniecki » Thu, Apr 22, 2021, 5:26 AM UTC

graeme wrote: post #33

paxys wrote: post #20

Earlier quoted context omitted.

Bitcoin can be a collectible and a store of value without ever becoming a currency. Gold, art, baseball cards etc. all fall into that category.

Those all have some kind of use value, and a story attached. Gold makes beautiful jewelry, collector’s cards remind people of childhood and baseball flory, art is lovely to look at and a way to flaunt wealth or feel a connection through the ages. You can look at all three and feel a fuzzy glow of happiness as you ponder the attached narrative. My point was that, if the author’s argument is true, bitcoin will only hav…

That feels like a rationalization of an emotional argument.

Gold's current value is not related to its function as a material for jewelry, but from a myth that it is a store of value. If people would stop believing the myth, the cost of gold would plummet and stabilize around the value it provides as a material for jewelry.

Similarly, "art is lovely" is a really stretched argument. If you want, you could print your transaction block hash and consider it pretty as a math-art concept.

So yes, bitcoin needs people to believe in its value to remain valuable, much like everything else that is not a raw utility - nations, religions, money, corporations, gold, baseball cards, and so on.

Heck, even Ferraris would become much cheaper if people only valued them for their function. They cost a lot primarily because we value them highly due to myths and scarcity.