I don't have much to add on the technology side and it's quite obviously a scam that will end badly for people who have sunk a lot into it but I spent I think $75-90 (whatever CDN to USD conversion was) and got a fraction of a coin a while back.
I have been able to use this tiny amount to pay for some online services and I even recently converted some to 100 microsoft bucks (ludicrous fee applied) and I still have a little bit left.
I bought 3 games with the microsoft bucks.
So yes it's not a retirement plan but some places do take it and you could get lucky on the rollercoaster.
That said, I haven't bought any since that initial tiny bit and have no intention to.
I think the best indication of where Bitcoin is headed is the announcement the North American Bitcoin Conference had to stop accepting registration payments in Bitcoin because of technical issues and high transaction prices.
I know less about investment and finance then anyone in their mid-thirties in north america and even I can tell you that crypto-currency is unto investment what Cryonics is to legitimate medicine.
I find it more appropriate to think of them as crytocommodities. You can mine them for cash, or speculate on the markets, but any exchange of goods based on them is more akin to barter and carries a good risk of their value changing before you can cash out.
bitcoin has always been shaky, but recently, more than ever, it's approaching mainstream meme status, which has never been beneficial to anything before.
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
As a complete layman to cryptocurrency, what makes the Bitcoin fad feel so foolish to me is that practically no one who is casually buying/mining this truly intends to spend it on anything. Only the most optimistic futurists have serious plans to pay their rent in bitcoins some day - everybody else just plans to ride the value up to some theoretical peak, and cash out in USD to spend it. What this says to me is that they all know deep down that this currency has no inherent value. If you can't spend it on anything it's not a currency at all, and it certainly isn't worth anything, the valuation is just a form of mass hysteria. They simply haven't put two and two together yet.
The speculation fad is exactly why it has very little spending utility. If you had a dollar and thought in a month it would be worth 10 dollars would you be inclined to spend it?
Well before there's even a question of spending it or not, there first has to be a business that will accept it. There have been a few of course, but most sane businesses would not ever be comfortable with this amount of volatility. If I'm a business owner and I pay all my expenses in USD, and I know that all of my customers are able to pay in USD, what's the point in accepting bitcoin? Why should I even waste my time implementing that?
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
It actually has negative economic value, since it is eating enough electricity to power the country of Denmark and is wearing out computer hardware that could have been used in productive ways, while providing a worse service than mainstream alternatives (unless engaged in illegal activities).
Jephery on
}
"Orkses never lose a battle. If we win we win, if we die we die fightin so it don't count. If we runs for it we don't die neither, cos we can come back for annuver go, see!".
I find it more appropriate to think of them as crytocommodities. You can mine them for cash, or speculate on the markets, but any exchange of goods based on them is more akin to barter and carries a good risk of their value changing before you can cash out.
No. Commodities are physical things which have use value. (I mean not necessary on the definition of commodity, but implicit).
Speculation in commodities can have economic value because mispricing means misaallocation intertemporally*. Speculation without use value is gambling.
*as an example, oil speculation drives the price of oil up... which is good if we want to use less oil... which we do.
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
That's not a shell game. Nor is it a pyramid scheme, for that matter. It is sort of similar to a Ponzi scheme, in that payoffs come directly from convincing someone else to buy in. It doesn't fit the definition perfectly, though, since all of the transactions aren't flowing through a single entity.
Is there a term for the sort of decentralized thing where something is being passed around that's so expensive but inherently worthless that the only way for someone to recoup their investment is to convince some other sucker that they want it?
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
Is there a term for the sort of decentralized thing where something is being passed around that's so expensive but inherently worthless that the only way for someone to recoup their investment is to convince some other sucker that they want it?
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
That's not a shell game. Nor is it a pyramid scheme, for that matter. It is sort of similar to a Ponzi scheme, in that payoffs come directly from convincing someone else to buy in. It doesn't fit the definition perfectly, though, since all of the transactions aren't flowing through a single entity.
Is there a term for the sort of decentralized thing where something is being passed around that's so expensive but inherently worthless that the only way for someone to recoup their investment is to convince some other sucker that they want it?
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
Is there a term for the sort of decentralized thing where something is being passed around that's so expensive but inherently worthless that the only way for someone to recoup their investment is to convince some other sucker that they want it?
I don't think, that like in the past, there's a large criminal / internet underground element in BTC anymore.
The buzz is that the real Bad Guys use Monero now, which is supposedly easier for transactions / harder to trace? I have no real idea.
I'm still not convinced about the core ideas behind BTC as a solution to any currency problem, even if I were to accept that what is listed as problems are actually problems.
Real currency is also unbacked, this is true. It is controlled by central banks, which are tied to governments. In my view, this is where they derive their stability. Because those governments are powerful and can use a variety of methods to make me pay taxes, ensure their future existence etcetera. These systems do cause inflation, but the "runaway inflation" scares never came up, even as the EU, Britain, the USA and Japan all have gone through extensive periods of Quantitive Easing (which is essentially the "fakest" of money, taking obligations of the money out of the system by buying them with money money you just created by loaning it to yourself interest-free. It is meant to cause inflation, and seems only limited in its ability to do so)
But BTC is so unwieldly, and solely based on the idea that Inflation Is Bad so we should have a set number of trading tokens (BTCs cap is 21M, and the mining of coin 17M is upon us). The technology is implemented very poorly, with hours worth of waiting time, dubious exchange mechanics with large fees and many stories of robberies. The blockchain, essentially the worlds transaction logfile, now threatens to grow so large it barely fits on HDDs anymore (It's at 150gb now, and growing at about 7gb/month)
This is why you now see BTC backing a minimum price of other cryptocurrency.
One thing I do wonder about is if the BTC bubble is an outlet for the fact that there is so much "cheap" money floating around the upper tier of the economy right now. The return on low risk investments is negative because of the current interest rates being lower than inflation, the stock market has seen very rapid increases.
It's almost impossible to sift the True Believers from the Uninformed from the Greater Fool seekers, but when this falls apart, a lot of people will be in trouble, and only a few people will truely have made a lot of money. And it depends on how many fools are left.
The fact that a juice company can change their name to Cryptojuice company, with no real business plan except a press release and triple in stock value is a huge indicator that noone knows what the fuck their doing, and that this is a gold rush.
And the people benefiting are the people selling the equipment. GPU prices are insane right now.
As a complete layman to cryptocurrency, what makes the Bitcoin fad feel so foolish to me is that practically no one who is casually buying/mining this truly intends to spend it on anything. Only the most optimistic futurists have serious plans to pay their rent in bitcoins some day - everybody else just plans to ride the value up to some theoretical peak, and cash out in USD to spend it. What this says to me is that they all know deep down that this currency has no inherent value. If you can't spend it on anything it's not a currency at all, and it certainly isn't worth anything, the valuation is just a form of mass hysteria. They simply haven't put two and two together yet.
The speculation fad is exactly why it has very little spending utility. If you had a dollar and thought in a month it would be worth 10 dollars would you be inclined to spend it?
Well before there's even a question of spending it or not, there first has to be a business that will accept it. There have been a few of course, but most sane businesses would not ever be comfortable with this amount of volatility. If I'm a business owner and I pay all my expenses in USD, and I know that all of my customers are able to pay in USD, what's the point in accepting bitcoin? Why should I even waste my time implementing that?
For businesses it's even worse. Companies budget for upcoming years. Its fairly easy to predict inflation but imagine budgeting paying your employees in something as unstable as BTC? You literally wouldn't know if someone's salary was 50k or 100k since it could change by the day
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I ZimbraWorst song, played on ugliest guitarRegistered Userregular
As of November 2014 the IRS treats Bitcoin like property, the USD value for which is determined on the day of receipt or realization. However I am not a lawyer but I also believe it's precluded from 1031 like kind exchanges. Like maaaaybe Bitcoin for Bitcoin, but Bitcoin for another crypocurrency would not. The IRS doesn't allow tax preferenced property across assets like stocks and bonds and certainly not gold for silver, so.
bitcoin has always been shaky, but recently, more than ever, it's approaching mainstream meme status, which has never been beneficial to anything before.
When it comes to speculation and pump and dumps and all that, once it starts hitting the front page, it's usually time to gtfo.
Ok so I may make a longer post later using some rudimentary monetary economics as an explainer.
But the long and short of it will be that Bitcoin is a scam and can only be a scam. The equilibrium value of any deflationary currency can take only one of two values, infinity, and zero.
What this means, roughly, is that we know it’s final resting point but it’s going to be a wild ride getting there.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
Is there a term for the sort of decentralized thing where something is being passed around that's so expensive but inherently worthless that the only way for someone to recoup their investment is to convince some other sucker that they want it?
As wikipedia also points out, this may not have been quite as severe/widespread as popular history would have us believe.
Still, everyone agrees that it is an early example of a bubble. (The South Sea Company bubble is another good one, and which also led directly to the idea of national reserve banking.)
There was this Japanese red diaper baby and computer criminal named Satoshi. The NSA blackmailed him into working for them until they wanted him to inform on members of the JCP in Taiwan. He killed himself. One of his projects, Bitcoin, became a massive ponzi scheme where services like Magic: the Gathering Online Exchange repeatedly steal everyone's fake computer money with no consequences.
The kicker is that not only does mining Bitcoins do some unspecified computing task for the NSA, but every Bitcoin is traceable because there's a central record of every transaction that occurs using Bitcoin. This is how they actually got Silk Road. There have also been multiple reversions of Bitcoin which have taken people's fake computer money.
If you are stupid and immoral enough to be involved in the criminal enterprise known as BitCoin, be safe. Don't get stabbed over fake computer money by some fedora who posts in r/physicalremoval.
I don't believe in this for a second, but this would make for a killer plot of a book.
As of November 2014 the IRS treats Bitcoin like property, the USD value for which is determined on the day of receipt or realization. However I am not a lawyer but I also believe it's precluded from 1031 like kind exchanges. Like maaaaybe Bitcoin for Bitcoin, but Bitcoin for another crypocurrency would not. The IRS doesn't allow tax preferenced property across assets like stocks and bonds and certainly not gold for silver, so.
As of 2018 all sells are taxable. All.
To be clear: Buying something (even a different coin) with a bitcoin is considered income equal to the purchased item's value?
There's some contention but because Bitcoin was classified as property you could theoretically exchange it for similar property without paying taxes on the gain.
I say theoretically because the IRS was quiet on it. I'm very very convinced that it's not that type of property. But basically you had bought Bitcoin cheap and exchanged it out 2 years later for Assface coin at current day market value. So you'd pay no tax on that event until you sold Assface coin.
I would be far more blase about the increasing number of grifters and rubes falling again for this Bitcoin cryptocurrency bullshit if they weren't driving up demand for fancy video cards to the point where there's a $400+ premium on a 1080ti everywhere I look.
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TetraNitroCubaneThe DjinneratorAt the bottom of a bottleRegistered Userregular
I'm not sure who first called BitCoins "Dunning Krugerrands", but it still feels like an apt description today.
The fact that a juice company can change their name to Cryptojuice company, with no real business plan except a press release and triple in stock value is a huge indicator that noone knows what the fuck their doing, and that this is a gold rush.
One of my acquaintances is a financial manager (fiduciary responsibility and all that) and he has a pretty good metaphor: in the late 90s all you needed to do get venture capital was take any dumb business, add "e" to the name, and say you're taking it online. That's where "crypto" and "block chain" are now.
Feral on
every person who doesn't like an acquired taste always seems to think everyone who likes it is faking it. it should be an official fallacy.
To be honest I'm not sure I've ever fully understood how government-issued paper money has value, let alone bitcoin.
It used to be backed by government reserves of gold and silver, but now it's based on people having faith that the U.S. government will not collapse any time soon and that having a common medium of exchange is a good thing.
Unlike Bitcoin, which is based on people having faith that the government will collapse soon and they'll be lords of the wasteland due to their ability to still buy weed and anime over the internet thanks to Bitcoin.
Cryptocurrency is a dead end scam. I know there has been discussion of block chains having value for things outside of the scam racket that is cryptocurrency. As others have said you don't really see anyone getting bitcoin to use as a legitimate currency. Most are either getting it because they think it'll make them rich and they can avoid missing their chance to cash out when every crumbles or they are using it as a means to skirt the law on making certain kinds of purchases.
The amount of power wasted on the endeavor is also disgusting. I feel there are better uses for the resources wasted on mining cryptocurrency that would actually be beneficial. Also resent how it has likely cost a price increase for certain things, that really shouldn't exist.
I work in marketing and I've seen a shit ton of ads for cryptocrurrency crap in the last year or so. At one point I mostly dealt with the ads for online stuff before being moved to another team, but I think I've seen more online cryptocurrency ads for both internet ads (I occasionally get drafted to help my old team get caught up if they fall behind) and my current project in the last 6 months, than I have seen for the first 2.5 years I've been working this job. I'm wondering if this is the sign that things are hitting their peak and we're about to see all this shit go down in flames. Oh, also so one where it's was digital versions of vintage cars that you could partly own, no I'm not making this shit up.
To be honest I'm not sure I've ever fully understood how government-issued paper money has value, let alone bitcoin.
there are two particularly concrete sources of value:
a government (generally) requires by law taxes be paid in its own currency
a government (generally) requires by law that debtees accept that currency as payment
that drives people to use the currency day-to-day since it's guaranteed useful for paying their taxes and paying their debts
then the more people who want to use it as their daily currency the more valuable it is
the other effects are around, like, stability which is down to how well its managed by the central banks and I don't really know about that
life's a game that you're bound to lose / like using a hammer to pound in screws
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
To be honest I'm not sure I've ever fully understood how government-issued paper money has value, let alone bitcoin.
Currency has value in two sense. The first is economic. Currency reduces transaction costs. The second is transactional, you can trade something for it.
A good way to think of why currency has transactional value is to understand that is has economic value. That is, an economy with a currency does better than an economy without a currency.
At that point you should realizes that the question is less “why does a currency have value?” but “what curreency has value, and what is that value?” because at least one currency is very likely going to have value. It’s like asking why 24 came up on the roulette wheel. The wheel was spun it was probably going to come up with something.
The reason then that currencies which have value have value is because they’re stable (which gives them more value by reducing risk). This stability comes in a number of ways. Sometimes it’s physical backing(you can trade this for x amount of gold), sometimes it’s less physical backing (you can always use this to pay taxes and purchase goods from this country or “the full faith and credit”), sometimes it’s historical inflation record, (IE how well it’s managed), or how widespread it’s use is (network effects). or a combination of all of these types of things.
The actual transactional value depends on a combination of the velocity and quantity of the currency in question. IE how much is out there and how fast it’s spent relative to the total amount of goods it’s used to purchase.
Bitcoin is pretty much a terrible showcase to demonstrate blockchain
A ton of its faults are due to how poorly and/or scammishly it was calibrated. Deflation and ridiculous transaction times don't need to be a thing.
It seems like there will always be a more fundamental issue, though, which Bitcoin's slowness has served to obscure. For a cryptocurrency to function on any reasonable scale, it needs to be able to handle thousands of transactions concurrently. Banks can pull this off because they all trust each other enough to handle things asynchronously, but cryptocurrencies require changes to be made synchronously.
Can someone explain how Tether is supposed to work and what is the point of that cryptocurrency?
My understanding of it was that 1 tether was supposed to be backed by 1 dollar, which put a floor on the valuation and made it theoretically stable in a way the other coins aren’t.
Of course I’m fairly certain that there’s no way these theoretical dollars exist and it’s all just a scam. The shortest path to scam is the smart play with any crypto currency.
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surrealitychecklonely, but not unloveddreaming of faulty keys and latchesRegistered Userregular
i wanted to buy a shitload of dogecoin when it first came out because i love meme's but i forgot to do it
i am a FOOL i could have been a dogecoin milliionaire
i wanted to buy a shitload of dogecoin when it first came out because i love meme's but i forgot to do it
i am a FOOL i could have been a dogecoin milliionaire
I tried to make money in doge for shits and giggles in like 2012 and then I realized people wanted to pay me the equivalent of $2 and hour...Still kinda wish I had done it in hindsight.
I find it more appropriate to think of them as crytocommodities. You can mine them for cash, or speculate on the markets, but any exchange of goods based on them is more akin to barter and carries a good risk of their value changing before you can cash out.
I work at a hedge fund that primarily trades futures (including commodity features, and Bitcoin futures - for what it's worth we were one of the first such firms to do so, albeit on an extremely limited scale). From our perspective, Bitcoin behaves much more like a commodity future than an FX (currency) future. One heuristic I use is that, with a currency pair, you can meaningfully speak about a two-way relationship. If I'm talking EURUSD and sat it increased (meaning a stronger Euro), it implies an inverse effect on the other currency. This can then be linked to one or more conditions that underlie the change (i.e. changing interest rates, employment figures, what have you). Even though you'll see BTCUSD listed like a currency it would be nonsensical to speak of a change in bitcoin implying any effect whatsoever on the USD. In fact, it's so out of step that arbitrage opportunities exist between different currencies and Bitcoin (what this means is I could potentially go USDEUR -> EURBTC -> BTCUSD and wind up with more USD than I started with, whereas you would never expect this arbitrage condition to persist in, say, a USD, JPY, EUR relationship).
Also on Steam and PSN: twobadcats
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Gabriel_Pitt(effective against Russian warships)Registered Userregular
To be honest I'm not sure I've ever fully understood how government-issued paper money has value, let alone bitcoin.
Money has value because the governments say it does, and it keeps that value because of what a government does. The U.S. dollar has the legacy of going all the way back to being back by precious metal, and even if that doesn't give it any intrinsic value, that reliability gives people confidence in using it. It would take something huge, and probably almost literally earth shattering, to make that lose its value. Stability and reliability are what gives fiat money its value.
Which is the reason why the Venezuelan Bolivar is almost literally worthless. It has zero stability, an zero reliability, because the government is full of morons who read 1984 and thought THAT was how you run a government, and no, the problem has nothing to do with how the economy was tied ENTIRELY to their oil market, nonono, all the problems are caused by ENEMIES OF THE STATE who hate Venezuela's freeedoms!
The current official exchange rate is listed as 10 Bolivars = 1 USD. The ACTUAL exchange rate is more like 200,000.00 Bolivars = 1 USD, but since the government pretends otherwise, and does things like tells stores things like, 'you must sell your staple goods XX price, or you will go to prison you enemy of the state!' (when actuall costs are XXXXX) no on trusts Bolivars, no one wants Bolivars. Keeping money is a losing proposition, because inflation is doubling costs every two months. That's what real hyperinflation looks like, because what ever cash you had four months ago is now worth 25% of what you had.
One of the financial websites I frequent has been serving me ads about "bitcoin IRAs" for about six months.
I've been getting ads on twitch about new bitcoin exchanges for a couple of months now.
About three weeks ago my uncle got in touch with me to ask my opinion on bitcoin. He said he'd made a few hundred bucks on it so far and was thinking about going in big.
All these things indicate that bitcoin is likely to crash soon.
Posts
I have been able to use this tiny amount to pay for some online services and I even recently converted some to 100 microsoft bucks (ludicrous fee applied) and I still have a little bit left.
I bought 3 games with the microsoft bucks.
So yes it's not a retirement plan but some places do take it and you could get lucky on the rollercoaster.
That said, I haven't bought any since that initial tiny bit and have no intention to.
Bitcoin is a shell game of getting in early enough so some other rube buys you out at whatever inflated price it currently sits at.
It has no economic value. It doesn't produce anything, generate new technology, or even act as an ancillary investment vehicle. It's just herd mentality around a commodity, where as you noted, it's deflationary, so eventually it will crash.
Well before there's even a question of spending it or not, there first has to be a business that will accept it. There have been a few of course, but most sane businesses would not ever be comfortable with this amount of volatility. If I'm a business owner and I pay all my expenses in USD, and I know that all of my customers are able to pay in USD, what's the point in accepting bitcoin? Why should I even waste my time implementing that?
It actually has negative economic value, since it is eating enough electricity to power the country of Denmark and is wearing out computer hardware that could have been used in productive ways, while providing a worse service than mainstream alternatives (unless engaged in illegal activities).
"Orkses never lose a battle. If we win we win, if we die we die fightin so it don't count. If we runs for it we don't die neither, cos we can come back for annuver go, see!".
No. Commodities are physical things which have use value. (I mean not necessary on the definition of commodity, but implicit).
Speculation in commodities can have economic value because mispricing means misaallocation intertemporally*. Speculation without use value is gambling.
*as an example, oil speculation drives the price of oil up... which is good if we want to use less oil... which we do.
That's not a shell game. Nor is it a pyramid scheme, for that matter. It is sort of similar to a Ponzi scheme, in that payoffs come directly from convincing someone else to buy in. It doesn't fit the definition perfectly, though, since all of the transactions aren't flowing through a single entity.
Is there a term for the sort of decentralized thing where something is being passed around that's so expensive but inherently worthless that the only way for someone to recoup their investment is to convince some other sucker that they want it?
Tulipmania
https://en.wikipedia.org/wiki/Tulip_mania
Hot potato?
It’s not a very important country most of the time
http://steamcommunity.com/id/mortious
People were trying to do this with Iraqi Dinars about 3-4 years ago, too.
The buzz is that the real Bad Guys use Monero now, which is supposedly easier for transactions / harder to trace? I have no real idea.
I'm still not convinced about the core ideas behind BTC as a solution to any currency problem, even if I were to accept that what is listed as problems are actually problems.
Real currency is also unbacked, this is true. It is controlled by central banks, which are tied to governments. In my view, this is where they derive their stability. Because those governments are powerful and can use a variety of methods to make me pay taxes, ensure their future existence etcetera. These systems do cause inflation, but the "runaway inflation" scares never came up, even as the EU, Britain, the USA and Japan all have gone through extensive periods of Quantitive Easing (which is essentially the "fakest" of money, taking obligations of the money out of the system by buying them with money money you just created by loaning it to yourself interest-free. It is meant to cause inflation, and seems only limited in its ability to do so)
But BTC is so unwieldly, and solely based on the idea that Inflation Is Bad so we should have a set number of trading tokens (BTCs cap is 21M, and the mining of coin 17M is upon us). The technology is implemented very poorly, with hours worth of waiting time, dubious exchange mechanics with large fees and many stories of robberies. The blockchain, essentially the worlds transaction logfile, now threatens to grow so large it barely fits on HDDs anymore (It's at 150gb now, and growing at about 7gb/month)
This is why you now see BTC backing a minimum price of other cryptocurrency.
One thing I do wonder about is if the BTC bubble is an outlet for the fact that there is so much "cheap" money floating around the upper tier of the economy right now. The return on low risk investments is negative because of the current interest rates being lower than inflation, the stock market has seen very rapid increases.
It's almost impossible to sift the True Believers from the Uninformed from the Greater Fool seekers, but when this falls apart, a lot of people will be in trouble, and only a few people will truely have made a lot of money. And it depends on how many fools are left.
The fact that a juice company can change their name to Cryptojuice company, with no real business plan except a press release and triple in stock value is a huge indicator that noone knows what the fuck their doing, and that this is a gold rush.
And the people benefiting are the people selling the equipment. GPU prices are insane right now.
For businesses it's even worse. Companies budget for upcoming years. Its fairly easy to predict inflation but imagine budgeting paying your employees in something as unstable as BTC? You literally wouldn't know if someone's salary was 50k or 100k since it could change by the day
Sarah Jeong called them Math Beanie Babies and I think that's as good an analogy as any.
As of 2018 all sells are taxable. All.
When it comes to speculation and pump and dumps and all that, once it starts hitting the front page, it's usually time to gtfo.
As wikipedia also points out, this may not have been quite as severe/widespread as popular history would have us believe.
Still, everyone agrees that it is an early example of a bubble. (The South Sea Company bubble is another good one, and which also led directly to the idea of national reserve banking.)
I don't believe in this for a second, but this would make for a killer plot of a book.
To be clear: Buying something (even a different coin) with a bitcoin is considered income equal to the purchased item's value?
Or... what does that mean?
I say theoretically because the IRS was quiet on it. I'm very very convinced that it's not that type of property. But basically you had bought Bitcoin cheap and exchanged it out 2 years later for Assface coin at current day market value. So you'd pay no tax on that event until you sold Assface coin.
People do this with commercial real estate often.
One of my acquaintances is a financial manager (fiduciary responsibility and all that) and he has a pretty good metaphor: in the late 90s all you needed to do get venture capital was take any dumb business, add "e" to the name, and say you're taking it online. That's where "crypto" and "block chain" are now.
the "no true scotch man" fallacy.
It used to be backed by government reserves of gold and silver, but now it's based on people having faith that the U.S. government will not collapse any time soon and that having a common medium of exchange is a good thing.
Unlike Bitcoin, which is based on people having faith that the government will collapse soon and they'll be lords of the wasteland due to their ability to still buy weed and anime over the internet thanks to Bitcoin.
The amount of power wasted on the endeavor is also disgusting. I feel there are better uses for the resources wasted on mining cryptocurrency that would actually be beneficial. Also resent how it has likely cost a price increase for certain things, that really shouldn't exist.
I work in marketing and I've seen a shit ton of ads for cryptocrurrency crap in the last year or so. At one point I mostly dealt with the ads for online stuff before being moved to another team, but I think I've seen more online cryptocurrency ads for both internet ads (I occasionally get drafted to help my old team get caught up if they fall behind) and my current project in the last 6 months, than I have seen for the first 2.5 years I've been working this job. I'm wondering if this is the sign that things are hitting their peak and we're about to see all this shit go down in flames. Oh, also so one where it's was digital versions of vintage cars that you could partly own, no I'm not making this shit up.
battletag: Millin#1360
Nice chart to figure out how honest a news source is.
there are two particularly concrete sources of value:
a government (generally) requires by law taxes be paid in its own currency
a government (generally) requires by law that debtees accept that currency as payment
that drives people to use the currency day-to-day since it's guaranteed useful for paying their taxes and paying their debts
then the more people who want to use it as their daily currency the more valuable it is
the other effects are around, like, stability which is down to how well its managed by the central banks and I don't really know about that
fuck up once and you break your thumb / if you're happy at all then you're god damn dumb
that's right we're on a fucked up cruise / God is dead but at least we have booze
bad things happen, no one knows why / the sun burns out and everyone dies
Currency has value in two sense. The first is economic. Currency reduces transaction costs. The second is transactional, you can trade something for it.
A good way to think of why currency has transactional value is to understand that is has economic value. That is, an economy with a currency does better than an economy without a currency.
At that point you should realizes that the question is less “why does a currency have value?” but “what curreency has value, and what is that value?” because at least one currency is very likely going to have value. It’s like asking why 24 came up on the roulette wheel. The wheel was spun it was probably going to come up with something.
The reason then that currencies which have value have value is because they’re stable (which gives them more value by reducing risk). This stability comes in a number of ways. Sometimes it’s physical backing(you can trade this for x amount of gold), sometimes it’s less physical backing (you can always use this to pay taxes and purchase goods from this country or “the full faith and credit”), sometimes it’s historical inflation record, (IE how well it’s managed), or how widespread it’s use is (network effects). or a combination of all of these types of things.
The actual transactional value depends on a combination of the velocity and quantity of the currency in question. IE how much is out there and how fast it’s spent relative to the total amount of goods it’s used to purchase.
A ton of its faults are due to how poorly and/or scammishly it was calibrated. Deflation and ridiculous transaction times don't need to be a thing.
It seems like there will always be a more fundamental issue, though, which Bitcoin's slowness has served to obscure. For a cryptocurrency to function on any reasonable scale, it needs to be able to handle thousands of transactions concurrently. Banks can pull this off because they all trust each other enough to handle things asynchronously, but cryptocurrencies require changes to be made synchronously.
My understanding of it was that 1 tether was supposed to be backed by 1 dollar, which put a floor on the valuation and made it theoretically stable in a way the other coins aren’t.
Of course I’m fairly certain that there’s no way these theoretical dollars exist and it’s all just a scam. The shortest path to scam is the smart play with any crypto currency.
i am a FOOL i could have been a dogecoin milliionaire
I tried to make money in doge for shits and giggles in like 2012 and then I realized people wanted to pay me the equivalent of $2 and hour...Still kinda wish I had done it in hindsight.
I work at a hedge fund that primarily trades futures (including commodity features, and Bitcoin futures - for what it's worth we were one of the first such firms to do so, albeit on an extremely limited scale). From our perspective, Bitcoin behaves much more like a commodity future than an FX (currency) future. One heuristic I use is that, with a currency pair, you can meaningfully speak about a two-way relationship. If I'm talking EURUSD and sat it increased (meaning a stronger Euro), it implies an inverse effect on the other currency. This can then be linked to one or more conditions that underlie the change (i.e. changing interest rates, employment figures, what have you). Even though you'll see BTCUSD listed like a currency it would be nonsensical to speak of a change in bitcoin implying any effect whatsoever on the USD. In fact, it's so out of step that arbitrage opportunities exist between different currencies and Bitcoin (what this means is I could potentially go USDEUR -> EURBTC -> BTCUSD and wind up with more USD than I started with, whereas you would never expect this arbitrage condition to persist in, say, a USD, JPY, EUR relationship).
Also on Steam and PSN: twobadcats
Money has value because the governments say it does, and it keeps that value because of what a government does. The U.S. dollar has the legacy of going all the way back to being back by precious metal, and even if that doesn't give it any intrinsic value, that reliability gives people confidence in using it. It would take something huge, and probably almost literally earth shattering, to make that lose its value. Stability and reliability are what gives fiat money its value.
Which is the reason why the Venezuelan Bolivar is almost literally worthless. It has zero stability, an zero reliability, because the government is full of morons who read 1984 and thought THAT was how you run a government, and no, the problem has nothing to do with how the economy was tied ENTIRELY to their oil market, nonono, all the problems are caused by ENEMIES OF THE STATE who hate Venezuela's freeedoms!
The current official exchange rate is listed as 10 Bolivars = 1 USD. The ACTUAL exchange rate is more like 200,000.00 Bolivars = 1 USD, but since the government pretends otherwise, and does things like tells stores things like, 'you must sell your staple goods XX price, or you will go to prison you enemy of the state!' (when actuall costs are XXXXX) no on trusts Bolivars, no one wants Bolivars. Keeping money is a losing proposition, because inflation is doubling costs every two months. That's what real hyperinflation looks like, because what ever cash you had four months ago is now worth 25% of what you had.
I've been getting ads on twitch about new bitcoin exchanges for a couple of months now.
About three weeks ago my uncle got in touch with me to ask my opinion on bitcoin. He said he'd made a few hundred bucks on it so far and was thinking about going in big.
All these things indicate that bitcoin is likely to crash soon.