Bitcoin is a disaster • Hacker News Board

Re: Bitcoin is a disaster

#531

Post by anonisko » Fri, Jan 01, 2021, 1:07 AM UTC

oblio wrote: post #67

baby wrote: post #31

That’s nonsense. Bitcoin is as good a store of value as gold due to one unique feature: scarcity. Actually, it’s even less power consuming than the gold industry and is much more transparent. I wouldn’t really advise bitcoin for anything else, like day to day transactions, although I and many of my friends have used bitcoin to transact on dark markets and it works. The only argument I’ve heard about gold being better…

> Gold is good for nothing useful imo, but is used in jewlery and other because it has value (not the other way around, as in gold has value because people make jewelry with it). You do know that gold has super low reactivity and it's a very good conductor, right? :-)

This is an underappreciated possibility of bitcoin.

All that insane amount of gold that's collecting dust in vaults being used as a store of value? Suddenly free to be used productively if bitcoin replaces it. Same with real estate that owners let sit unsed because they're primarily using it as a store of value rather than a productive asset.

Re: Bitcoin is a disaster

#532

Post by bconnorwhite » Fri, Jan 01, 2021, 1:07 AM UTC

NicoJuicy wrote: post #437

bconnorwhite wrote: post #416

Most of the criticisms in this thread seem to be missing that Bitcoin is only layer 1. Bitcoin isn't Visa or cash - its gold. Rather than shipping gold across the Atlantic, large institutions will settle in a few minutes in Bitcoin. L2/L3/L4 solutions (built into Apple Pay, etc.) will allow for instant payments for coffee, allow for privacy similar to physical cash, etc. Before this is possible, the price has to stab…

Bitcoin ain't sold. Gold had it's value being tradeable offline.

Price action would seem to agree with your typo

Re: Bitcoin is a disaster

#533

Post by ineedasername » Fri, Jan 01, 2021, 1:07 AM UTC

Finnucane wrote: post #45

rmason wrote: post #14

I was real excited the first time that Bitcoin was explained to me. I saw it as the first real alternative to paper money. But what I soon learned is that most of the people associated with Bitcoin saw it as digital gold and were only interested in seeing the value rise and cashing out. I've seen a few positive developments every once in a while that fail to get much adoption. So I keep waiting and waiting. It increa…

> "But what I soon learned is that most of the people associated with Bitcoin saw it as digital gold " Since it was basically designed to work like a pseudo-physical commodity, and most of the rhetoric to support its existence is warmed-over goldbuggery, why should this be surprising?

Gold seems like it was always an odd thing to pin an economy to to begin with. A resource that isn't inherently tied to value that seems to have been "chosen" by centuries of evolution towards a scarce material that could be centrally controlled. What's more, it has become less scarce as better technologies have emerged for extracting it. And just like printing excess fiat currency, early gold rushes showed the same type of rapid inflation in local economies, with money made by those selling mining tools & services to miners, and those purchasing the mined gold to arbitrage it out to other geographical regions. It was still just an abstraction layer put on top of direct bartering to solve the liquidity problems inherent to direct bartering once the # of goods and services reach a high enough level.

The fundamental principal of economics that many people miss when they focus mainly on monetary supply is that the velocity of capital [0] is of equal or perhaps even greater importance.

[0] https://www.aier.org/article/what-is-money-velocity-and-why-...

Re: Bitcoin is a disaster

#534

Post by doingmyting » Fri, Jan 01, 2021, 1:07 AM UTC

bconnorwhite wrote: post #512

toyg wrote: post #456

Earlier quoted context omitted.

Except Bitcoin has no way to “stabilize”. Without central banks’ intervention and governance, even regular currencies would fluctuate like crazy. Unless the bitcoin world can come up with a Federal Reserve / ECB equivalent, it will continue to be a wild ride, which will effectively impede further uses. It will always be a speculation vehicle rather than a store of value.

I think the difference is that currencies fluctuate against each other, whereas if everything is priced in Bitcoin, its whatever you're pairing it against that's fluctuating. Goods (ex: loaf of bread for 200 satoshis for example) would stay stable

Currencies fluctuate against demand in the foreign exchange market, not against each other. Governments then step up to stabilize that demand. Bitcoin doesn't have that support so it fluctuates wildly, exactly like it's been doing since it's inception.

Re: Bitcoin is a disaster

#535

Post by ZguideZ » Fri, Jan 01, 2021, 1:07 AM UTC

leadingthenet wrote: post #528

ZguideZ wrote: post #497

I commented something similar to this below - the true value of Bitcoin is that it was put on autopilot and took off - in the meantime, there is no record of who the creator of it is - except a persona called Satoshi Nakamoto. It has been adopted widely enough that it cannot be shut down. It is decentralized, extra-governmental, and you can't sue or indict the founder or a centralized organization. Yes, bitcoin is co…

Is it really "Anarchy" if it's essentially controlled by small a clique of miners with specialized hardware that most people don't have / can't realistically have access to?

To the system as it exists? Absolutely.

Re: Bitcoin is a disaster

#536

Post by wcoenen » Fri, Jan 01, 2021, 1:08 AM UTC

acover wrote: post #394

wcoenen wrote: post #327

Earlier quoted context omitted.

When the government issues bonds, they sell them for commercial bank money, the same type of money in your bank account. When the central bank later buys those bonds from banks (they never buy them directly), something different happens: the bonds are exchanged for "bank reserves", a different type of digital money that only exists as numbers in the central bank's database. This "money" cannot be used to buy grocerie…

> A central bank implements quantitative easing by buying financial assets from commercial banks and other financial institutions, thus raising the prices of those financial assets and lowering their yield, while simultaneously increasing the money supply. Quantitative easing increases the money supply. They've injected trillions. Who got it is a separate question.

Quantitative easing only increases "bank reserves" in the accounts at the fed, not the money supply. The accounts at the fed are an isolated system. To increase the money supply, commercial banks need to create money via loans.

Re: Bitcoin is a disaster

#537

Post by everfree » Fri, Jan 01, 2021, 1:08 AM UTC

majewsky wrote: post #429

rkagerer wrote: post #324

I bought my smartphone from Hong Kong, in part because I wanted a specific variant that would be more likely to work with open-source ROM's. The seller initially requested payment via Transferwise, who sought crazy amounts of personal information and bullied me into a privacy-hostile customer agreement. Days went by and they still hadn't activated my account. Growing frustrated, I convinced the seller to accept Bitco…

Can we have "cash you can email" that doesn't consume as much electricity as several nation states combined?

Many coins are experimenting with alternative consensus algorithms, the most promising imo is proof of stake.

No wasted energy beyond the cost of running a normal computer.

Re: Bitcoin is a disaster

#538

Post by leadingthenet » Fri, Jan 01, 2021, 1:08 AM UTC

ZguideZ wrote: post #461

jokethrowaway wrote: post #13

Completely agreeable, albeit it misses a point: Governments can't print more of it. That's it really, everything else is noise. I can sympathize with btc (I wish we still had a gold standard, or a standard based on the price of common goods) but I don't see much the other benefits. On top of this, governments could ban btc.

Perhaps the most powerful thing about Bitcoin is that the guy who created it is unknown (if Satoshi was a guy or a lone person at all) and that it mostly runs on autopilot and at this point is not governed by a single body. It can't be sued. The creator of it can't be sued. And yes, more of it can't be made and there is deflation built into it. Genius.

I think you mean deflation, the exact opposite of inflation, is built into Bitcoin.

Re: Bitcoin is a disaster

#539

Post by wyldfire » Fri, Jan 01, 2021, 1:08 AM UTC

majewsky wrote: post #429

rkagerer wrote: post #324

I bought my smartphone from Hong Kong, in part because I wanted a specific variant that would be more likely to work with open-source ROM's. The seller initially requested payment via Transferwise, who sought crazy amounts of personal information and bullied me into a privacy-hostile customer agreement. Days went by and they still hadn't activated my account. Growing frustrated, I convinced the seller to accept Bitco…

Can we have "cash you can email" that doesn't consume as much electricity as several nation states combined?

Yes. Proof of stake coins like nano don't require any proof of work. Peercoin, too. Ethereum is considering PoS IIRC.

Re: Bitcoin is a disaster

#540

Post by imtringued » Fri, Jan 01, 2021, 1:08 AM UTC

hartator wrote: post #126

keithwhor wrote: post #24

Related: the current rise of Bitcoin prices has been peculiar to me, and seems to be a bit of a canary in an inflationary coal mine. We've injected trillions of dollars of fiat into the economy this year. It feels like the sky-high valuations of technology companies and Bitcoin are "shock absorbers" of sorts, or early signals of inflation-yet-to-come. If we assume the market is efficiently pricing these assets (like…

> the price of things like groceries, beer and travel double or triple what they were in 2019. It's already the case. Not 2x or 3x but double digits inflation on groceries notably meat products won't be surprising when we do the math next year.

If that were true then it would be time to rejoice and watch underemployment disappear. The central bank can then unload its balance sheets and reduce inflation to sustainable levels. If that does not help you can also increase taxation to take care of inflation. There are a lot of tools that can trivially deal with too much inflation but with deflation the only tool you have is the central bank pumping money into the market and so far it is failing to achieve its stated goals.