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Is There a Cryptocurrency Bubble? Just Ask Doge

nytimes.com

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Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#71

Post by dogruck »

PretzelPirate wrote: post #70
dogruck wrote: post #45

Earlier quoted context omitted.

I do not personally believe the bitcoin markets will function properly for the shorting mechanism to pay off in interesting scenarios. If I borrow your bitcoins, how will you force me to sell them? If we agree that a third party will warehouse those coins, how can I trust them? And if BTC plunges, who's to say that 3rd party will still operate? All very different from shorting a stock. But if you want to loan me your…

People successfully short cryptocurrencies every day and reputable exchanges pay out, even during massive drops. If you really want to short, sign up at GDAX and enable margin trading.

"It has worked ok so far. Therefore there's no problem."

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#72

Post by csallen »

josu wrote: post #65
hn_throwaway_99 wrote: post #63

Earlier quoted context omitted.

> Bitcoin made currency decentralised and permissionless. This is a common misconception, that cryptocurrencies can somehow exist outside government control, and it makes me doubt some of the long term value of Bitcoin. A government can basically make anything it wants illegal, and once cryptocurrencies become large enough, there will be tons of additional regulations and control.

Drugs are illegal almost everywhere in the world and they are one of the largest consumer markets. Something similar happens to US dollars in Venezuela. So I don't know if making bitcoin illegal will really hurt its value in the long run.

Your conclusion doesn't follow your observation. It's one thing to say that the government can't stop something, and quite another to say the government can't hurt it. Who knows how much bigger the drug trade would be without anti-drug laws.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#73

Post by aboodman »

EGreg wrote: post #68
craigc wrote: post #29

Earlier quoted context omitted.

That is a very good question. I didn’t do a good job making an argument for why I think the value of a currency like Bitcoin could be so much higher than an altcoin that did an ICO. In my opinion, Bitcoin has the first mover advantage in this space. It was the first real use of the blockchain, is still the gateway to pretty much every other crypto currency, there is a maximum supply of coins, and is one of the only c…

Question: Bitcoin is a global cryptocurrency. Sure it has a first-mover advantage but so does Google. Today someone searches with google, tomorrow they may switch to Bing. Can't the same be said of Bitcoin and say Litecoin / Dogecoin / whatever? So why is Bitcoin worth more than Litecoin let's say? Both are accepted by Coinbase etc.

Currencies have network effects - everyone who will transact in a specific currency increase the value of that currency for everyone else.

So one reason BTC is worth more (speaking of entire market cap here) than, say, LTC, is because it is accepted more places.

Another reason is that BTC is perceived (rightly or wrongly) as more stable than other crypto currencies.

But all those legitimate reasons are amplified dramatically right now by speculation.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#74

Post by omegaham »

School-Cotton wrote: post #58
omegaham wrote: post #30

Earlier quoted context omitted.

From his talk: > I refer to it by this name because I once discussed it with Murray Gell-Mann, and by dropping a famous name I imply greater importance to myself, and to the effect, than it would otherwise have.

This might be humblebragging, since Crichton is certainly more famous than Gell-Mann.

But Circhton was an author, while Gell-Mann was a physicist. We associate scientists with a lot more rigor than authors.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#75

Post by qznc »

dogruck wrote: post #71
PretzelPirate wrote: post #70

Earlier quoted context omitted.

People successfully short cryptocurrencies every day and reputable exchanges pay out, even during massive drops. If you really want to short, sign up at GDAX and enable margin trading.

"It has worked ok so far. Therefore there's no problem."

You want to suggest that they would not pay out if Bitcoin crashes to zero? Maybe. They are not regulated after all. They might also be bankrupt before Bitcoin hits zero.

Still, you can short these 30% drops without problem.

Did shorting the housing market work out well in the crash? I remember a movie with Christian Bale, where it did.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#76

Post by zby »

What is a bubble? """ An economic bubble or asset bubble (...) is trade in an asset at a price or price range that strongly exceeds the asset's intrinsic value. """ from wikipedia https://en.wikipedia.org/wiki/Economic_bubble

What is intrinsic value of Bitcoin? There is none. But it is the same with dollars actually, yes if you live in the US then you can pay taxes with it, but you mostly pay taxes only after you earn dollars. And then the same with gold - the intrinsic value of gold as a technical material or for jewellery is probably a small fraction of its current market value. I tend to think that being in a bubble is a defining feature of money - people want it not for its value - but because they believe they'll later exchange it for something valuable.

Money is a perpetual bubble, a bubble that does not pop. I am not sure if there is a place for thousands of inflated bubbles. There is too much friction in such a system - you never know if the seller will accept your coins.

Not all cryptotokens are money - some are just securities with an intrinsic value - for example https://zrcoin.io/ which is backed by a promise to buy it back for the market price of 1kg of ZrO2.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#77

Post by dtech »

zby wrote: post #76

What is a bubble? """ An economic bubble or asset bubble (...) is trade in an asset at a price or price range that strongly exceeds the asset's intrinsic value. """ from wikipedia https://en.wikipedia.org/wiki/Economic_bubble What is intrinsic value of Bitcoin? There is none. But it is the same with dollars actually, yes if you live in the US then you can pay taxes with it, but you mostly pay taxes only after you ear…

> Money is a perpetual bubble, a bubble that does not pop

The bubble can very much pop if people stop having faith in the currency and stop accepting it (or demanding larger amounts to compensate), making the currency lose its value.

This is a very large risk for most current cryptocurrencies, bitcoin included.

I would also argue that the Dollar has a very strong link to useful physical goods: it's the only currency OPEC oil is sold in.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#78

Post by danmaz74 »

aml183 wrote: post #41

I have great respect for Kevin Roose, but this was a disappointing piece. Dogecoin was a meme. It gained popularity and is still worth something. Jackson Palmer might not believe it has value, but clearly, there are people who own Doge that think otherwise. There is definite frothiness in the market. Some token sales are scams, some are overpromising, and some that look promising will probably blow up. Take a look at…

> Jackson Palmer might not believe it has value, but clearly, there are people who own Doge that think otherwise

If there is one way you really can't detect a bubble, it's relying on "people thinking X has value". Also people buying tulip bulbs for a house worth thought those bulbs had value, as in every other bubble in history.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#79

Post by chrisco255 »

InclinedPlane wrote: post #59

Is there a cryptocurrency bubble? Of. Fucking. Course. Only those who are extremely naive or cryptocurrency zealots could possibly believe otherwise. Now, here's the core problem preventing people from understanding the reality of the bubble: in almost all bubbles there is still a kernel of honest, real value inside the bubble. That's the impetus for the bubble, but it doesn't prevent the bubble from being a bubble.…

Google was founded in 1998, the dot com bubble didn't burst until 2001. Google had already established search engine dominance by then.

Re: Is There a Cryptocurrency Bubble? Just Ask Doge

#80

Post by ianai »

danmaz74 wrote: post #78
aml183 wrote: post #41

I have great respect for Kevin Roose, but this was a disappointing piece. Dogecoin was a meme. It gained popularity and is still worth something. Jackson Palmer might not believe it has value, but clearly, there are people who own Doge that think otherwise. There is definite frothiness in the market. Some token sales are scams, some are overpromising, and some that look promising will probably blow up. Take a look at…

> Jackson Palmer might not believe it has value, but clearly, there are people who own Doge that think otherwise If there is one way you really can't detect a bubble, it's relying on "people thinking X has value". Also people buying tulip bulbs for a house worth thought those bulbs had value, as in every other bubble in history.

It's when the last hold out is convinced that the bubble bursts.
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