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Bitcoin is a Ponzi

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Re: Bitcoin is a Ponzi

#471

Post by luka-birsa »

rvense wrote: post #362
luka-birsa wrote: post #310

Why are such articles constantly popping up on HN? It's clear that the HN crowd does not like Bitcoin. So why keep reiterating similar arguments all over? There is zero utility in the article shared. It states some anti crypto views and that's it. Even the author concedes that this is according to his own definition and not based on real life legal tests (which have of course shown that Bitcoin is not a ponzi). Just…

Maybe when cryptocurrency enthusiasts stop running around with bullhorns telling people about how they're going to save the world. You're not saving anything. There are valid criticisms of the current financial system, but cryptocurrencies are not a good answer to them.

The initial post is literally the flip side of the same coin.

We've had romantic Bitcoin maxis in the beginning, saying Crypto will change the world, we now have luddists screaming to stop the crypto as it will destroy the world.

Only a small portion of users are the Crypto maxis. And they truly can't care less about such posts. They might have been wrong about what Crypto means, but you cannot deny the use. BC is a reserve currency of a nation. EU is contemplating digital euro. People invented a way and are exchanging ownership of IP daily with various block chains.

Crypto is here. I highly doubt it its going away. Too much value and utility.

Perhaps it would be best to simply create a HN News policy to ban crypto related stuff as it really boils down to maxi-haters reiterating their views over and over.

But I do understand that is great for Karma farming.

Re: Bitcoin is a Ponzi

#472

Post by reaperducer »

arcticbull wrote: post #325
MelonTree wrote: post #161

Earlier quoted context omitted.

I got involved in bitcoin after being blackballed from the (US) financial world while for 2-3 months while I was "investigated" in the most dystopianly opaque way possible. One day I lost the ability to transact. A few months later I got it back. Had it not been for good friends who could cover my expenses, I could have easily ended up homeless. And the most shocking part of it all, was that I was merely collateral d…

> I don't hold bitcoin because I think it'll go up in value, I hold it because I don't want someone to tell me I can't pay rent because ... well they can't tell me why, because "sorry, I don't have access to that information" Well you certainly can't do that with Bitcoin unless your landlord has a similarly anarchocapitalist worldview. You'd have to cash it out at an exchange and pay the individual in question. This…

You'd have to cash it out at an exchange and pay the individual in question. This choke point would leave you similarly locked out.

Would it? The parent commenter was in the United States, and even in cities of about 1 million people, I've seen Bitcoin ATMs at chain supermarkets. Some were even integrated into the ubiquitous CoinStar machines at the front of the store.

Re: Bitcoin is a Ponzi

#473

Post by fshbbdssbbgdd »

darawk wrote: post #306

> First, few if any gold investors have expectations of profits. They generally invest in gold as a hedge -- a "store of value" -- that they hope will retain its value in case other assets go sour. Lol. Bitcoin is exactly comparable to gold. Plenty of people buy gold expecting it to appreciate...because other people use it as a hedge. Even if it were true originally that Gold's only purpose was as a hedge (protip: it…

One reason you can’t call gold a Ponzi scheme is that gold isn’t a scheme at all. There is no inventor of gold who owns 5% of the gold.

Re: Bitcoin is a Ponzi

#474

Post by forgotmyoldname »

nprz wrote: post #221
zacmps wrote: post #163

Earlier quoted context omitted.

I'm sorry, what applications? Besides accelerating global warming there doesn't seem to be anything it's good at.

Pseudonymous, censorship-resistent, permissionless, peer-to-peer. Many people in authoritarian or monetarily irresponsible countries use these features to protect, store, and transfer their wealth[0]. [0] https://www.theguardian.com/technology/2021/jul/31/out-of-co...

I hear this a lot. It sounds nice.

Yet trying to set up crypto as a person in a developed country in 2021 is kind of a pain in the ass. It's not too hard to exchange between types of crypto, but getting real money that I can buy a pizza with in and out of an exchange? Not too easy. There are requirements for credit cards or confirmed bank accounts for payment, scans of an ID card or driver's license to prove I'm a human, the possibility banks can at any point determine it's a scam and block transfers to any exchange, and so on.

If it's that hard for me, a person in a developed and ostensibly free country to do it, how the hell is some average person--not a government official or wealthy person with connections--in North Korea or Eritrea going to set it up and secure their financial future to any degree better than a pocket full of cash and old jewelry?

Re: Bitcoin is a Ponzi

#475

Post by nightski »

arcticbull wrote: post #406
nightski wrote: post #183

People do not invest in USD because they expect a gain? Anyone holding cash is doing exactly this. Because the only rational reason to hold USD instead of spending it or converting it to some other asset/investment is because you think it's value is going to either hold or grow more than other options. If people expected no gain in USD (or inflation) then they would not hold USD and instead choose assets or other inv…

Nope, people do not hold USD because they expect a gain. They are willing to pay the inflation penalty because holding the dollars in question provides them something. Generally that means either a sense of security or liquidity on short notice. Holding dollars is paying a fee for liquidity.

Does it really make sense to hold USD if your only goal is liquidity? Maybe if you need it immediately, but honestly stocks and some other investments can usually be sold with the money accessible in seconds (or you can use credit). Really what I feel the value prop is for cash is low volatility (aka security as you mentioned).

With low inflation like we have seen in the past, risk adjusted it might be a better spot to hold that money relative to other investments. So yes, I hold a small portion of my portfolio in USD for that gain.

If it was not providing that low volatility (inflation spikes like crazy), then I'd be much less inclined to keep my money in USD outside of the minimum I'd need for immediate spending. Because returns are low. So the "gain" is in the risk adjusted return relative to other assets (which could ultimately be slightly negative).

Re: Bitcoin is a Ponzi

#476

Post by lodovic »

donatj wrote: post #349
frozenport wrote: post #341

Earlier quoted context omitted.

I also think investing in gold compared to let's say stocks is a sort of ponzi scheme in the sense of OPs article. So no price point. Until bitcoin intrinsically generates value I'm not putting money in it.

Cash doesn’t intrinsically generate value. It’s value comes from your belief in it.

Yes, but Bitcoin is missing the liquidity of cash. Especially if an average transaction costs between $5 and $20

Re: Bitcoin is a Ponzi

#477

Post by jcbrand »

In fact, while bitcoins are created in a fixed amount only when the miners have expended a large amount of work, the creation of those bitcoins costs nothing. The reward per block is defined by two lines of code in a program. By changing those lines, the reward could be sixty or six million bitcoins per block, with no extra work being required from the miners.

This sentence is proof enough that this person doesn't get bitcoin.

You're welcome to change those two lines, start mining and then see what happens.

Your mined blocks will be rejected by other nodes in the network and you'll be spending energy costs without getting anything in return.

The whole point of bitcoin is that you can't just change the source code and thereby the properties of the emergent network. You need to get a majority of nodes (not just miners) to support your change. This is not easy to do, and won't happen if your change is detrimental to the majority of network participants.

Re: Bitcoin is a Ponzi

#478

Post by [deleted] »

newswasboring wrote: post #266
lalaland1125 wrote: post #249

Earlier quoted context omitted.

The fees for Bitcoin are way too high to make sense for citizens in poor authoritarian counties. The average transaction fee during slow periods is about $5 and it jumps to $20 whenever there is load on the network. And the lightning network is a poor solution to this because the LN requires a lot of capital to fund channels, something poor people explicitly don't have. Finally, the fact that Bitcoin proponents have…

> The average transaction fee during slow periods is about $5 and it jumps to $20 whenever there is load on the network. When people say this, do they mean $5/$20 per bitcoin or per any transaction whatever size?

[deleted]

Re: Bitcoin is a Ponzi

#479

Post by ipaddr »

CheezeIt wrote: post #446
ulrikrasmussen wrote: post #421

Earlier quoted context omitted.

To begin with, let me say I'm very sorry this happened to you, and I think it sounds like an example of a really broken system. This should never happen to someone randomly, and I think you should have been compensated a lot for the troubles and stress it must have caused you. However, I think we should be careful with drawing the conclusion that technology for circumventing our institutions' ability to regulate alto…

Nope, we don’t want central democratic control over who can transact. We want no control.

An open exchange is progressive. A verified list of people who can transact is a closed stockmarket. Democratic imples a direct vote which is very far from true.

Re: Bitcoin is a Ponzi

#480

Post by scottyp21 »

graeme wrote: post #459
scottyp21 wrote: post #326

> Nevertheless, investing in gold at the current price seems unwise, since its price is many times its "natural" price as commodity and so it is more likely to go down than up. This is a misconception and a fundamental misunderstanding of gold's primary utility for thousands of years. While it is true that gold's price reflects a significant premium beyond the "natural" market price, this has been the case for millen…

> at what price point and time would you start to consider that you may be tragically wrong? In theory Bitcoin can keep growing as long as people believe in it. It has a strictly negative EV though. * it returns no revenue * At current mining levels, it burns about 1.8% of its market cap annually. By burns I mean literally burns energy and ASICs. (About $18 billion at current market prices) * That’s just for mining c…

Many of these same arguments apply to gold. Do you think gold is (mostly) useless today? If yes, when did it stop becoming useful? Do you think it was always useless?
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