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

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

#411

Post by monkeydreams »

throwaway4good wrote: post #84

The full tweet is actually easier to read: https://twitter.com/nntaleb/status/1382446478539550727 WHAT WE WANT CRYPTO & CURRENCY FOR: 1) Currency w/o a government 2) Stable/reliable for contracts 3) Inflation indexed store of value -- basket of items representative for me. 4) Rapid transactions Can we do it? #BTC failed to be currency, open-Ponzi speculative game. A currency must earn interest: currencies weren't bor…

> A currency must earn interest

Taleb at it again. He's decided on his definition of a currency and, lo and behold, Bitcoin doesn't make the cut, much to the chagrin of the coin bros who will flock to its defense.

Normal currency is zero-sum from certain contexts. If I have a dollar and I give it to you then you won and I lost. The only reason that fiat currency earns interest is that the promise of payment tomorrow is almost as easily tradeable as the product itself which, given BC's volatility, is difficult.

Bitcoin is a currency in that it is a medium of transaction, no matter what Nicholas Taleb has to say about it. It is not failed at being a currency but it has failed at being a stable currency so far.

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

#412

Post by 127 »

isoprophlex wrote: post #152
127 wrote: post #150

Bitcoin is new technology. Internet took 42 years from 1967 to 2009 to get from zero to Bitcoin. How long for Bitcoin to get zero to Arguably, the technology is much more complex and slow moving because it has to store value instead of just random bits.

> Arguably, the technology is much more complex and slow moving because it has to store value instead of just random bits. What does this even mean? Writing ones is faster than writing random integers?

It's much harder to fix a jet engine in flight than on the ground.

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

#413

Post by herbst »

matkoniecz wrote: post #221
herbst wrote: post #197

Earlier quoted context omitted.

> can be stolen remotely with no recourse. By bruteforcing into the wild? What are ypu referring to?

Malware scanning for wallets is not unusual. In some cases password (private key) as sole and sufficient method to have full control over asset, executable by anyone is a problem not a benefit.

Malware stealing bank accounts, credit cards & paypal is just as popular. All of which you have no real influence about the actual account security.

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

#414

Post by herbst »

ABeeSea wrote: post #207
herbst wrote: post #195

Earlier quoted context omitted.

I honestly never experienced that. Its not like any crypto investor is running around converting others.

How many crypto investors have you been around? I’ve had many, many coworkers trying to convince me to buy Bitcoin over the last decade. This is across different companies, teams etc. And I have definitely witnessed the same thing online. I mean I wish I had listened because BTC was $50 a coin the first time someone tried to convince me to buy in.

Plenty. However maybe thats a cultural thing but i rarely have people insisting on any kind of investing advice. We might talk about stuff, but both sides know risks are involved. I never experienced evangelism IRL and i even spent some time in ctypto meetups

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

#415

Post by herbst »

dorkwood wrote: post #278
herbst wrote: post #195

Earlier quoted context omitted.

I honestly never experienced that. Its not like any crypto investor is running around converting others.

The entire crypto art movement is a marketing campaign designed to turn artists into crypto evangelists, i.e. convert others.

Source? Couldnt it be that some artists are just super happy they found a way to dsitribute their art lucratively?

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

#416

Post by herbst »

tim333 wrote: post #205
herbst wrote: post #195

Earlier quoted context omitted.

I honestly never experienced that. Its not like any crypto investor is running around converting others.

There are people promoting it on youtube - I was watching some last night (What Bitcoin Did https://youtu.be/Pw6tfNh8DAk ) but most seem to be recommending it sincerely rather than trying to sucker some fools in so they can cash out. It's an interesting time in the history of bitcoin as we are starting to see a move from small speculators (number go up) to institutions buying in (it's sensible to diversify 5% of your…

Sure i do talk positive about crypto too. But i would never tell anyone where to put their money.

Its just wrong to think all people in crypto are evangelising others into their ponzi investments

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

#417

Post by pyrale »

bartvk wrote: post #410
birdyrooster wrote: post #401

Earlier quoted context omitted.

That's right, but I think the OP was asking about differences in BTC from Gold as Ponzi schemes. I don't think it was "what makes Gold valuable"? I am just saying you can't use the BTC for anything but the scheme if it was a Ponzi scheme. Just to put some additional data to this: Jewellery: 92,947 tonnes, 47.0% Private investment: 42,619 tonnes, 21.6% Official Holdings: 33,919 tonnes, 17.2% Other: 28,090 tonnes, 14.2…

BTC also could be useful as a hedge against other assets, for example the stock market or the currency you save in. I view it as a possible hedge against the Euro. This is the currency I daily use, but I definitely keep the Greek Debt Crisis in mind.

The principle of hedging is that two assets hedge each other if their price demonstrably evolve in opposite directions. For instance, if a bank sells an equal amount of puts (the right to sell at a given time) and calls (the right to buy at a given time) on an action with the same strike price and the same maturity, it is hedged: both positions cancel each other.

Since BTC has no underlying asset, it's hard to demonstrate a correlation with anything. So if you buy btc as a hedge, you could pretend you're hedging against anything. In reality, the only significant factor is btc's popularity.

That means you could probably buy anything that isn't correlated with Euro and get the same result.

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

#418

Post by Valakas »

tim333 wrote: post #301
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 (…

That's not really true. You could bury a bottle in the backyard with the address and private key written on paper and still have the bitcoins in 20 years. If no one is running the blockchain software you could get the most recent copy of the chain / software and start it up. With both gold or bitcoin if there are no buyers then you won't be able to sell it for much. It might actually be entertaining to bury a bottle…

Gold is a metal made in the burning core of dying stars. It doesn't really care about buyers and economy. We use gold for many purposes other than as a store of value, and that is exactly why it became a store of value. It is useful BESIDES being a store of value. Heck if you don't like gold, buy platinum or some other exotic material. Stores value just as well. Bitcoin is useless besides being a store of value. That makes it a bad store of value.

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

#419

Post by bartvk »

pyrale wrote: post #417
bartvk wrote: post #410

Earlier quoted context omitted.

BTC also could be useful as a hedge against other assets, for example the stock market or the currency you save in. I view it as a possible hedge against the Euro. This is the currency I daily use, but I definitely keep the Greek Debt Crisis in mind.

The principle of hedging is that two assets hedge each other if their price demonstrably evolve in opposite directions. For instance, if a bank sells an equal amount of puts (the right to sell at a given time) and calls (the right to buy at a given time) on an action with the same strike price and the same maturity, it is hedged: both positions cancel each other. Since BTC has no underlying asset, it's hard to demons…

Correlation is a pretty fickle thing. Multiple hedges make for a nice diverse portfolio. So yeah, I consider gold a good component as well. Why add bitcoin as well? Because it makes for a nice bet.

We used to all rely on bonds and bills to stabilize our portfolios but central banks have killed that.

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

#420

Post by bob33212 »

bartvk wrote: post #408
bob33212 wrote: post #277

Earlier quoted context omitted.

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 I'm not deeply steeped in macro-economics. Is this a theory, or an historical observation? Where can I find more about this?

Historically, there have been a wide range of items used in barter and markets. https://en.wikipedia.org/wiki/Currency#Early_currency. Some of those like livestock depreciated in value very quickly since they literally had a lifespan. Others, like rare coins have gone up in value.

In the context of Bitcoin we are talking about the modern world. The major forces in the modern world are Globalization and Technology. Assuming you don't want China to take over the world you need growth. Growth happens when investment and debts are created. Ray Dalio explains it well. https://www.youtube.com/watch?v=PHe0bXAIuk0&ab_channel=Princ... This is why successful countries like the USA target 2-3% inflation. It is theoretically possible to create a country where inflation was -1%, but technological growth, which is very hard to stop would create a deflationary spiral that would bring the economy to a halt.

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