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Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

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Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#71

Post by product50 »

Twisell wrote: post #70
product50 wrote: post #67

Earlier quoted context omitted.

No one needs to prove you anything. You are free to believe what you want. The world doesn't have the responsibility to convince a stranger of a concept s/he hasn't taken time to read or finds too difficult to understand. I would encourage you to read more about cryptocurrencies and how it has massive disruptive potential. Here are a good set of articles to get you started: https://thecontrol.co/some-blockchain-readi…

Still, but nicer, ad-hominem "you don't deserve explanation, because you don't know enough" followed by a link of endless references. I don't deny that cryptocurrencies might play a huge role in the future. And algorithms are indeed pretty clever. But I don't see why that prevent current bitcoin implementation to be a pyramid scheme and thus I ask. And haven't been answered so far. It's like arguing that tulips madne…

Sorry man - I tried to help.

Feel free to believe what you want. Good luck!

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#72

Post by askafriend »

Ologn wrote: post #20
lobster2 wrote: post #19

Earlier quoted context omitted.

/biz/ has been great for me, I bought some MOONCOINS at 1 satoshi and I will sell next week at 5 sat at least once the current sell walls have been broken. There also is a very active community behind MOONCOIN. Why are you so dismissive of this new technology? Can you expand on your idea?

> Why are you so dismissive of this new technology? I'm skeptical of the idea that Bitcoins have value in the way commodities and other things which can be traded and exchanged have value. People might find some use for blockchain technology, but the speculation around the value of Bitcoins is ridiculous. It's a bubble like any other bubble. The notion that a Bitcoin can remain at a $2000 value is absurd. The current…

Why do diamonds have value then? They have no intrinsic value. They are not a scarce resource. They don't have many industrial applications. Labs can grow diamonds that look pretty much identical to the real thing. Yet people still pay a ton of real money for diamonds.

Diamonds have value because we all have agreed that they have value. That's a really powerful concept to internalize. Similarly why does Gold have any value? Why does the American Constitution have any power?

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#73

Post by Twisell »

product50 wrote: post #71
Twisell wrote: post #70

Earlier quoted context omitted.

Still, but nicer, ad-hominem "you don't deserve explanation, because you don't know enough" followed by a link of endless references. I don't deny that cryptocurrencies might play a huge role in the future. And algorithms are indeed pretty clever. But I don't see why that prevent current bitcoin implementation to be a pyramid scheme and thus I ask. And haven't been answered so far. It's like arguing that tulips madne…

Sorry man - I tried to help. Feel free to believe what you want. Good luck!

Luck has nothing to do with that. Thanks for trying. Still hope someone can come with a better argument. But I follow bitcoin new since a few year and still nothing tangible in sight.

Some like you find my lack of faith disturbing, but I don't "believe" anything. I prefer scientifical skeptiscism.

PS: And because I am ready to change my mind, I've dug : https://www.reddit.com/r/Bitcoin/comments/5lsu8p/hot_news_fi...

Still no arguments, only bitcoin supporters performing ad-hominem attack against the analyst...

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#75

Post by kodfodrasz »

dmichulke wrote: post #68
kodfodrasz wrote: post #61

Earlier quoted context omitted.

I believe that the deflationary nature of cryptocurrencies is the real problem in replacing money. Also the fact that a trail is left behind transactions is unlike it is with cash. This property is cool for the government, but the users may not want to have it. On question that bugs me, but don't have enough knowledge bout Bitcoin: are the transactions public? (I believe they are). So anybody could map the wealth of…

Deflationary is not a bad thing at all - though I realize that most of mainstream economics thinks it is. A few thoughts on that: - Real wages rise when the currency deflates (good for working class, think about the effect of wealth inequality) - Debt becomes a problem (bad for indebted, such as government) The main official reason why deflation would be a bad thing is that it discourages spending. I think it discour…

I agree with the traditional view about deflation. It is bad, especially for the workers, who have almost no money to save, thus they do not get any of the benefits, but they take the most burden, as they must spend almost all of their income on survival. On the other hand others with more income have their savings growing in value, thus not spending, making consumption fall, which renders workers unneeded, etc...

about public transactions I beleive this is a real privacy problem. The government can track my spendings every day (well, not cash, but eletronic transactions which are the bulk of my money movements) even now (when a judge has signed a permit for them). The problem is if anyone can do that. I have given up some privacy to the government, but not to the random guy.

Now my question is: is this concern of mine about public traceability existing with bitcoin technology, or not? (only the technical aspects please. the philosophical side is out of scope here)

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#76

Post by Casseres »

kodfodrasz wrote: post #61
dmichulke wrote: post #57

Earlier quoted context omitted.

Papiermark got printed. BTC gets ...?

I believe that the deflationary nature of cryptocurrencies is the real problem in replacing money. Also the fact that a trail is left behind transactions is unlike it is with cash. This property is cool for the government, but the users may not want to have it. On question that bugs me, but don't have enough knowledge bout Bitcoin: are the transactions public? (I believe they are). So anybody could map the wealth of…

You might be interested in learning about Monero. The amounts and transactions aren't public like Bitcoin.

Here is a pretty good infographic outlining the gist of it: https://www.monero.how/monero-infographic

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#77

Post by someSven »

Ologn wrote: post #17

The difference is the dot-com stocks had some theoretical value - even Pets.com, people buy pet supplies online after all. Unlike commodities, equities and so forth, cryptocoins have no value whatsoever. So to try to make it sound like it has worth, its pushers have to cast about for anything they can and finally come upon the only thing they can - the dollar. In fact, they say, it's even better than the dollar. It w…

One value of Bitcoin is keeping money save from the authorities. For anonymous donations and microdonations it is also usefull. Speculation or insurance against the Fiat money economy is another usecase.

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#78

Post by runeks »

dmichulke wrote: post #53
coolspot wrote: post #48

Earlier quoted context omitted.

I think it is not absolute value what defines a bubble. It should be relative. E.g. perceived value of an asset compared to it's real value/revenue/growth.

To provide a context here - one of the key value propositions of BTC is real interest rate. Cash real interest rate: 0% interest - 2% inflation through debasing currency = -2% BTC real interest rate: 0% interest - 0% inflation = 0% Note how this benefit of BTC is not bubbly by itself (growth expectation usually is - due to it being based on past growth)

Prices only remain flat (0% inflation) if no increase in productivity occurs.

2% inflation doesn't mean the currency has been debased by 2%, it means: if it has become x% cheaper to produce a basket of goods -- and the price of this basket of goods has increased by 2% -- the currency has been devalued by (2+x)%.

Producers are constantly competing to cut the costs of production, in order to gain market share at the expense of competitors, so I don't see how flat prices can be a reasonable assumption.

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#79

Post by thisisit »

yamaneko wrote: post #43
jonnathanson wrote: post #23

Respectfully, I think a lot of comments on this topic are missing the point of the author's advice. Whether there is or is not a bubble, and if there is, how big that bubble might get, are irrelevant here. That's not what this article is about. First, the author assumes there is a bubble brewing. That's not his thesis; that's his background assumption. His thesis is that, assuming there is a bubble , you should do X,…

One of his advices is: > 2. Beware vanity metrics Can we tell if BitCoin and other cryptocurrencies has any vanity metrics? If so, what would that be? My uneducated guess would be how valuable the currency is in Dollars. The currency seems virtually inflated as we don't know how much of that would translate to real purchasing power. It doesn't seem that it would be possible to many people to sell it all out. Thus, wh…

It can also be the number of threads about bitcoin (or cryptocurrency) on Hacker news being upvoted to the top 10/20?

I was there when the last time bitcoin reached record highs. Surely the USD conversion rates play a large part when suddenly people get interested in block chain or bitcoin at all.

Other metrics can be the glut of "altcoins" with very high "genesis block" or ICO rates.

Re: Lessons I Learned from the Dotcom Bubble for the Coming Cryptocurrency Bubble

#80

Post by runeks »

jonnathanson wrote: post #23

Respectfully, I think a lot of comments on this topic are missing the point of the author's advice. Whether there is or is not a bubble, and if there is, how big that bubble might get, are irrelevant here. That's not what this article is about. First, the author assumes there is a bubble brewing. That's not his thesis; that's his background assumption. His thesis is that, assuming there is a bubble , you should do X,…

"Market cap" is the most-quoted vanity metric of the cryptocurrency market.

A more reasonable measure of the value of a cryptocurrency would be the following: if it were possible to create an infinite number of currency units, how much USD/EUR/etc. could be earned by selling everything into the market? In other words, the more reasonable metric is the sum of all (cryptocurrency) buy orders.

If we use the Bitcoin/USD market as an example, the four most liquid USD exchanges (using data from https://bitcoincharts.com) are -- in descending order -- Bitstamp, Coinbase, itBit, and Kraken.

The sum of all USD buy orders for these exchanges is $43 million (22583567.85[1], 9551529.73[2], 9310393.07[3], 1679397.01[4], respectively).

I'm not sure what this figure is for Ethereum, but my guess is that it's around 1% of that of Bitcoin -- whereas Ethereum's market cap is around 50% of Bitcoin's.

EDIT: On GDAX/Coinbase alone (https://www.gdax.com/trade/ETH-USD) it's possible to sell Ethers for over $12 million USD. So I guess I was wrong about the 1% figure. Although I believe $43MM USD for Bitcoin is an underestimate.

[1] https://bitcoincharts.com/markets/bitstampUSD_depth.html

[2] https://bitcoincharts.com/markets/coinbaseUSD_depth.html

[3] https://bitcoincharts.com/markets/itbitUSD_depth.html

[4] https://bitcoincharts.com/markets/krakenUSD_depth.html

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