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Bitcoin is a Ponzi

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Re: Bitcoin is a Ponzi

#651

Post by pas »

bb88 wrote: post #483
graeme wrote: post #410

Earlier quoted context omitted.

> They do not pretend making your money work for you by some magical scheme. No. They instead take your money, buy coal, and burn it. Nothing is left. As you say, Ponzi schemers take money for themselves and keep it. Most of what Madoff stole was recovered, for instance. Whereas virtually 100% of all money invested into crypto has been burned by miners. This is pretty easy to model. So there’s nothing left to recover…

> No. They instead take your money, buy coal, and burn it. Nothing is left. Interesting, I never thought of it that way, and it makes sense. Since money is not created or destroyed the balance sheet on inflows and outflows of BTC to dollars must be zero at all times. And some x% (which is variable) of it is transferred to miners which is the so-called "transaction" cost. I guess there must be a point at which the bub…

> Since money is not created

Isn't USD created? Thus BTC functions as a USD sink. As the USD economy expands BTC represents some claims on it. It's a store of value that automatically appreciates (by design basically).

Re: Bitcoin is a Ponzi

#652

Post by ashwagary »

gunshai wrote: post #510
bb88 wrote: post #483

Earlier quoted context omitted.

> No. They instead take your money, buy coal, and burn it. Nothing is left. Interesting, I never thought of it that way, and it makes sense. Since money is not created or destroyed the balance sheet on inflows and outflows of BTC to dollars must be zero at all times. And some x% (which is variable) of it is transferred to miners which is the so-called "transaction" cost. I guess there must be a point at which the bub…

If you're so certain short it. The amount of wealth you would gain by being correct is immense. You should be spending every waking moment attempting to predict it. Something about anti btcers I don't get you'll wax how smart you are and how everyone else is dumb. Just put your money where your mouth is.

Nassim Taleb pointed out that if you have no 'skin in the game' your opinion is actually less than worthless.

Worth considering...

Re: Bitcoin is a Ponzi

#653

Post by kayamon »

glenvdb wrote: post #425
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…

Some people will never change their minds. They've made their choice and changing their mind would be more painful than not. Bitcoin could be the world reserve currency and the same people would still say it's a scam. Ultimately, who cares? The world is changing with or without them.

On the contrary, we actually need them. The people who refuse to believe Bitcoin is real are the ones whose continued drive for fiat currency will fund the UBI for everyone else. It's win-win.

Re: Bitcoin is a Ponzi

#654

Post by graeme »

ashwagary wrote: post #652
gunshai wrote: post #510

Earlier quoted context omitted.

If you're so certain short it. The amount of wealth you would gain by being correct is immense. You should be spending every waking moment attempting to predict it. Something about anti btcers I don't get you'll wax how smart you are and how everyone else is dumb. Just put your money where your mouth is.

Nassim Taleb pointed out that if you have no 'skin in the game' your opinion is actually less than worthless. Worth considering...

If you are long bitcoin, you hold bitcoin. If you are for some other asset vs bitcoin, you hold that asset and not bitcoin.

Some things are simply tradeable, and his advice is not “throw money at the owners of a fraudulent casino to say you are short”

Nassim Taleb himself wrote a paper arguing Bitcoin’s value is zero and sold all his Bitcoin. I do not believe he believes it is his moral duty to open a Binance account and make a short on a Tether Exchange

Re: Bitcoin is a Ponzi

#655

Post by minitoar »

Kranar wrote: post #624
minitoar wrote: post #331

Earlier quoted context omitted.

I could collect dividends for a time and then sell the share for what I paid.

Dividends have no net effect on how much you earn from a share. If a stock is currently priced at X and then pays out a dividend of Y, the price of the stock decreases by Y so that there is no overall effect on the value. The reason for this can be understood in many different ways, but one way I like to look at it is if paying a dividend had no effect on the price of a stock, then one could in principle buy a share…

That isn’t what I’ve described. I said “for a time” and you chose to interpret it as something very specific.

Re: Bitcoin is a Ponzi

#656

Post by Kranar »

minitoar wrote: post #655
Kranar wrote: post #624

Earlier quoted context omitted.

Dividends have no net effect on how much you earn from a share. If a stock is currently priced at X and then pays out a dividend of Y, the price of the stock decreases by Y so that there is no overall effect on the value. The reason for this can be understood in many different ways, but one way I like to look at it is if paying a dividend had no effect on the price of a stock, then one could in principle buy a share…

That isn’t what I’ve described. I said “for a time” and you chose to interpret it as something very specific.

It is exactly what you described and my explanation focuses on a specific scenario to make it very clear why your reasoning is flawed. You can't just assert that it's possible to sell a stock in the future for the same price that you bought it for and that will magically come true, you have to observe what actually happens in reality and whether reality is consistent with your beliefs.

To better familiarize yourself with the literature, perhaps you can start with this seminal paper produced by the Federal Reserve:

https://www.jstor.org/stable/2962249

It looks at both the short term and long term impact of dividends and shows precisely that the marginal price of a stock drops by the amount of the dividend, meaning your premise that you can simply just sell the stock at a future date for the same price you bought it for is just not supported by the facts.

Whether you hold the stock and collect multiple dividends for 10 years or 10 days, the fundamental principle is the same: a stock with a marginal price of X that pays a dividend of Y will on average decrease in price by Y. Dividends produce no change in the overall net value of a portfolio, all a dividend does is convert one form of value into another, but no increase in value is ever produced.

Re: Bitcoin is a Ponzi

#657

Post by TawandaMoyo »

ogogmad wrote: post #524
TawandaMoyo wrote: post #391

Earlier quoted context omitted.

Thanks for pointing this out. People have different reasons why they believe in bitcoin (and other cryptos). Where I live the government has in the past 20 years wiped out citizens' savings at least 3 times, arbitrarily, without any notice. In such a situation using bitcoin, regardless of the risk/skepticism, is a far better alternative than having all your money disappear on the whims and or experiments of politicia…

It's sad to hear this. Is there no way for you to buy foreign currency like dollars instead? Bitcoin might be an attractive asset to speculate in, but I'm not sure if it's the safest way to hold onto your wealth, because of its inefficiency, volatility, the need for endless mining to sustain it, and so on. It might multiply your wealth by 10 or reduce it to zero -- do you really want to take the risk? I understand th…

You could buy US dollars of course, but you'd have to keep them under your mattress. The banks can convert foreign currency into local currency with a decree. I see your point though, and ideally I'd have some in something tangible, say real estate, but cryptos make sense to a lot of people dealing with crazy regimes.

Re: Bitcoin is a Ponzi

#658

Post by BrianHenryIE »

Freskis wrote: post #256
BrianHenryIE wrote: post #196

Earlier quoted context omitted.

To be entirely clear, a company I work with accepts Bitcoin, then ships physical products.

Is it possible you are not being accurate? That the company is actually receiving cash which has been converted from Bitcoin by a service? Accepting raw Bitcoin would lead to huge problems such as transaction time and price volatility. Either way, accepting bitcoin is horrifically bad for the environment, and one of the most ecologically destructive things tech companies do. It is not something I would be proud of.

Yes, straight up Bitcoin accepted. A single digit percentage of revenue.

But I don't think that changes the point much, that it is used for commerce.

And yes, the realisation that it's bad is a brewing thought. I've never invested any of my own money in Bitcoin (€200 in Ethereum) so I excuse (to myself) my involvement because it's passive.

https://wordpress.org/plugins/triplea-cryptocurrency-payment...

Re: Bitcoin is a Ponzi

#659

Post by dropnerd »

ItsMonkk wrote: post #270
glenvdb wrote: post #139

Earlier quoted context omitted.

I would be absolutely shocked if Bitcoin's value ever dropped to zero. I can't see any conceivable way that happens at this point. Even a coordinated effort by the world's governments to "ban" it (they can't really ban it) would not drive its price to zero... if anything it might even have the inverse effect. Can you provide any conceivable way this would actually happen? Maybe an asteroid hitting Earth and wiping ou…

You asked for any possible way. 1. Tether defaults. 2. People panic and sell at whatever price they can get. Let's say Bitcoin drops to $10k. 3. All miners that don't make a profit at $10k shut down. 4. With most miner's shut down, block times go from 10 minutes to 1 hour. 5. The fees to transact Bitcoin go up exponentially as people rush to get out. 10 Bitcoin to make it into a block, sure! 6. The price drops furthe…

at step 8, node operators and client devs would recognize that there is a crisis and there would be a hard fork

if the stakes are high enough, code is not law, even in btc land

Re: Bitcoin is a Ponzi

#660

Post by russianbandit »

satoshiiii wrote: post #118

Bitcoin is nothing new. See Rai stones: https://en.m.wikipedia.org/wiki/Rai_stones It's the people invested in it that gives it value. Just like fiat, gold, art, stamps, useless antiques, etc. As long as it has value to someone, then it has value. I can't see it disappearing anytime soon. Yes, it might fall and rise in value but to disappear like any other Ponzi scheme? Don't hold your breath. Bitcoin is more than a…

Nice try, Satoshi...
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