T O P

Why I think crypto currencies/Bitcoin is the future of money. But what are your thoughts on it?

Why I think crypto currencies/Bitcoin is the future of money. But what are your thoughts on it?

[deleted]

Not happening. Particularly in large functioning nation states. There are many scale transformations that facilitate the use of fiat. Even gold became insufficient for these tasks. Crypto stands no chance here for it holds an intrinsic value of precisely $0. The more interesting discussion is how Crypto stresses smaller countries with unreliable banks and governments to get their shit together. Once again though, as soon as those countries find some stability the Crypto is worthless. They are one of the most beautifully conducted Ponzi Schemes in history.


Lifeisagarden_Digit

Bitcoin and the rest of the 'Crypto' are very different. BTC is Finite in supply and decentralized where the others are controlled by their respective development teams as opposed to node operators. Also, having "intrinsic value" (a borderline meaningless term, all value is subjective) is not required for something to act as money. This is obvious as we currently use slips of paper whos only backing is someone's promise of repaying the credit, an IOU basically. If all it takes is a promise from a socially accepted institution to make worthless paper into money "intrinsic value" has nothing to do with it. Gold is not viable because of it's physical limitations, it's hard to transport, divide, or secure without incurring cost/loss.


[deleted]

These cut and paste explanations you offer demonstrate that Crypto has no compelling argument as a currency. You can test intrinsic value yourself. Would you pay to have a gold chain in your possession? Would you pay to have a $100 bill in your possession? Now would you do the same with Bitcoin? You would ONLY IF YOU CAN EXCHANGE IT FOR DOLLARS. The second no one is willing to give you Fiat for your Bitcoin it is worthless. The gold has utility at the least. The fiat has confidence and security at the least. Bitcoin has nothing. If trading stops, the entire house of cards fall. Any other time you would call this a Ponzi Scheme.


Lifeisagarden_Digit

Not sure what you mean by cut and paste. My claim was that there is no intrinsic value and that all value is subjective. The way you are postulating to falsify my claim is by asking what subjective value myself or others would place on various items. It's circular reasoning. Gold, dollars, and Bitcoin are all valued differently by each individual that appraises them at any given time. As different people assign different values they come together to trade the things they value less for the things they value more, thus creating a market for said items. Each of the three can be used as a medium of exchange or a unit of account with varying degrees of effectiveness. You can use almost anything, people have used shells and salt in the past along with other things. The worth of my Bitcoins is only determined by the dollar denominated value if I am selling it in a dollar market. You are correct in your line of thinking that Bitcoin is only worth what I can get from others for it in an exchange though, just like with anything else used for trade. The value of golds industrial use is also not the reason it's used as a monetary medium, it was used for that long before we did anything industrial with it. Aside from it's value as decoration or as a neat collectable its value was almost entirely monetary for most of it's 5000+ year history. Industrial utility doesn't matter if you are using gold to trade, unless you are trading around industrialists that want to purchase it for that reason. Bitcoin has value when people decide it does, and so far humanity has decided it's worth about $800+ billion Federal Reserve notes and counting. you can measure it other ways, but most people still use the paper notes we call dollars. The confidence and security in Fiat is quickly dwindling though, and was only ever substantiated by the State in any case. Bitcoin is the most secure computer network in the history of the human race when measure by breaches, interruptions, or error rates. Compare that with the roughly 8% error rate in the banking industry and it's no contest. Not to mention they are closed on weekends creating interruptions all the time. It also does not require trust to give confidence, its open and permissionless. Anyone can learn anything about it at any time and become as confident as they please. Bitcoin is certainly subjectively valuable just like everything else. If you think keeping information in a ledger, which is effectively what a bank does, is of any value then you also think Bitcoin is valuable. If you think the dollar is valuable because it's ledgers of account are secure, then you think Bitcoin is valuable. If you think information, the securing of information, and the communication of information is valuable then you think bitcoin is valuable. Provided you actually know what it is and how it works that is, but like I said anyone can learn if they care. Ponzi schemes imply the "greater fool" theory, the idea that something is only sold to people as valuable through deception and manipulation so that those doing the selling disproportionately benefit until the system collapses and the suckers are left holding the bad at the end. If you want an example of an actual ponzi scheme, I would refer you to the Federal Reserve's fractional reserve lending system. Otherwise knowns as the dollar.


[deleted]

Did not read your response. Why? You have thus far failed to make a singular compelling argument in favor of Crypto. It shouldn't take more than one sentence. The fact that you keep elaborating is telling me I should avoid Crypto. Funny enough, I would be more convinced if you simply stated that you own Crypto and profit from me buying in. Not claiming you are doing this, but that is much more compelling than your arguments thus far.


Lifeisagarden_Digit

Well, apparently you would not have read whatever argument I may or may not have made anyway, but I felt like I was responding to the particular points you raised. Your financial decisions are your own at any rate, I wish you all the best going forward.


junk_mail_haver

Very simplistic take. Currency system is way too complex for Bitcoin to replace it. The daily fluctuation price itself makes it simply unusable. And there's no real time solution for Bitcoin as of yet, it's simply not feasible due to the deflationary nature. Crypto is not going anywhere, it will not really replace the existing currency, but will surely operate side by side.


TheBlueMango01

Why not? Afterall a lot of financial instruments are already being created as crypto currencies (im thinking defi applications). Of course they still have a lot of room to grow and especially improve, but why not in the future?


Steve_Dobbs_69

Crypto backed by the dollar will flourish. Bitcoin, not so much.


TheBlueMango01

Okay fair enough, but that could still solve a fair amount of problems today with the USD, and would still be a threat to the current monetary system. It would drastically limit once more what governments can do with their currencies.


Steve_Dobbs_69

The government creates the currency that you use to feed yourself. They are not limited by any means. We are limited, because in the end we choose to live by it. Unless we bought an island and started a country, but then again the citizens of that country will have rules to follow as well lol


Lifeisagarden_Digit

All public institutions are simply the sum of the individuals that make them. These individuals are part of the society no matter how differently we choose to perceive them as a group. They are limited by their approval from the rest of society and by the kinetic force (police, military, etc.) they are capable of projecting through the control society grants them.


Lifeisagarden_Digit

Bitcoin backed by a Fiat currency is like hitching a horse up to your car, pointless and absurd. The whole point of Bitcoin is to eliminate the need for a trusted third party to declare via authority that a unit of account is of value. The only thing that gives the dollar and currencies like it any value is the promise of our public institutions beneath the shadow of violence. Bitcoin's value is determined entirely by free market forces independent of any authority, and no authority can do anything to Bitcoin except control the on/off ramps that lead to it from their respective Fiat currencies


Lifeisagarden_Digit

The currency system is indeed complex, but that does not mean you need a complex element to replace it. Simple elements following simple rules can create arbitrarily complex systems. Good examples are simple neurons creating brains, simple transistors creating computers, simple ants creating colonies, or simple protocols creating the internet. Money operates in layers of complexity as well. Back in the gold standard days it was gold assets layered with paper notes, layered with double entry ledger, layered with credit, etc. We cut out gold and other physical assets like 50 years ago but the layered architecture is still there and perfectly replaceable in spite of its apparent complexity. Volatility might be a problem for a liquid currency, but Bitcoin is an asset and will have protocols layered onto it to facilitate liquidity similar to how we made paper note to make gold more usable even though it is also volatile.


Steve_Dobbs_69

During Fiscal Year (FY) 2020, the IRS collected close $3.5 trillion, processed more than 240 million tax returns and other forms, and issued more than $736 billion in tax refunds (including $268 billion in Economic Impact Payments). In FY 2020, 59.5 million taxpayers were assisted by calling or visiting an IRS office. Bitcoin is about to fail. Not only that, you have to report it on tax returns like the dollar, oh and the government can seize your bitcoin. Which makes the whole cause defunct. Plus USD has already made their own cryptocurrency, so will other governments, which will then play with each other jerking each other off in exchange. USD Coin (USDC) is a digital stablecoin that is pegged to the United States dollar and runs on the Ethereum, Stellar, Algorand, Solana and Tron blockchains as well as on the Hedera Hashgraph system. Good game.


Lifeisagarden_Digit

Bitcoin is very far from failing, quite the opposite as it's being adopted by small nations states like El Salvador. The fact that it must be reported on your tax returns only serve to legitimize it, opening the doors for even more adoption by those who need clear legal guidelines in order to own certain assets. This is most of the larger institutions. Also, although it is technically possible to "seize" bitcoin if it is stored foolishly there is no way to take it if secured in cold storage and with a backup seed phrase memorized. theoretically they could attempt to capture and torture every citizen that they suspect has bitcoin for their seed phrase but that is just not realistic an any sort of scale. ​ Government "Crypto" is also not a threat to Bitcoin, or even in direct competition with it. Central Bank Digital currencies (CBDC's) share all of the problems with Fiat currency that Bitcoin is solving. those being the need to trust a third party, and infinite possible supply, and the permissioned nature of authoritative monetary systems. Any CBDC or Stablecoin will inherit all of these flaws making it completely irrelevant that are called "Crypto" or that they are digital. Bitcoin is a perfectly scarce asset, secured by a decentralized permissionless cryptographic protocol on a public ledger anyone can audit at any time for any reason. Not even in the same category.


TheBlueMango01

Okay I’m sorry but I don’t understand how these tax statistics and bitcoin is related. Could you elaborate on it?


Steve_Dobbs_69

Basically even if inflation occurs, the IRS is making a shit ton of money to back it up. They are not hurting. Therefore the economic "turmoil" is an illusion. The government is backed by legit money and will keep reaping it as long as we have tycoons in the US paying them.


TheBlueMango01

Are they tho? Isn’t that money going to fund public institutions, the government, and governmental agencies?


Steve_Dobbs_69

The problem is you're hoping that they fuck up. They're not going to...because the house always wins. They make the money, the tycoons pay to play. It's a win win for them.


TheBlueMango01

Okay first of all please don’t just edit your comments like that without stating it because it just confuses people and makes my whole comment irrelevant or badly phrased. Second leg I don’t think it’s that clear cut, because you seem to forget one very present variable, time. And maybe I should have elaborated more about it in my post. Yes, today we have to make out tax returns in USD, but why I’m saying is, let’s go into the future, let’s say we are faced in a situation where the USD is facing hyper inflation, similar to Germany in the 20s. At that point governments, and especially citizens will turn towards assets with low inflation rates to protect their money. We might not use bitcoin maybe, but what about a bitcoin backed USD. In the same way gold was pegged to the USD once upon a time. As for the American and European governments creating their own CBDCs, I don’t necessarily think that would work, or it would work partially. The entire point of a cryptocurrency is that you can’t produce more than is intended. It is in limited supply. However with a CBDC, you have yes, the technology of cryptography, however it’s still controlled by a central authority and that can still chose to print more money. So to conlcude, I disagree I don’t think it’s game over for bitcoin, or any cryptocurrency for that matter yet.


Steve_Dobbs_69

Don't care. As time goes on, the government is going to keep making trillions of dollars from tax dollars while it stifles bitcoins reason for existence, all the things you have mentioned basically of why people should turn to bitcoin. Literally what is the reason for it? You mention a bitcoin backed USD? But in the end it's backed by USD again. Plus they will regulate the shit out of it like they're already doing. Bitcoin is dead.


Lifeisagarden_Digit

the nominal value of the tax revenue generated by the state is not a relevant factor in deciding what monetary system will win out in the end. It will go up with certainty because inflation is simply an increase in the supply of money, this causes all things denominated in that currency rise in price but does not affect anything except the information contained in price signals. this continuing does not stifle bitcoin's reason for existing, it reinforces it. No action any nation state or group can take is capable of stopping the operation of the Bitcoin network, it's not a program it's a protocol. that means it's simply a set of rules agreed upon by those who elect to use the system, and it's constituent parts are information and computation. you can regulate or point a gun at 2+2 all you want, you might even trick or scare some people into thinking it's something else, but it still equals 4. bitcoin is alive and well, you cannot ban it. You can only ban yourself from it like China, but Bitcoin lives on growing at a faster adoption rate than the internet itself.


Steve_Dobbs_69

Viruses replicate faster. That doesn't mean it has any use other than to spread. Like you said bitcoin is a protocol, just like the USD which is also another protocol. Except that USD is the house and it makes its own money through collecting tax, so it essentially will never die while bitcoin will continue to try to prove itself. Bitcoin doesn't have any instrinsic use case other than it being a fashion statement or a collector's item. Especially if the government is able to seize your bitcoin and make you report the earnings on tax returns. The US is essentially China, but instead of offing you, they put you in jail. Last but not least, bitcoin has a huge vulnerability in itself because you have to have a mass of people constantly mining verifying all the transactions...sounds like an IRS to me. The protocol bitcoin follows is blockchain technology which all the governments around the world are going to use...bitcoin will be the outcast that never made it to the party. Alot of people on the bitcoin bandwagon are going to lose alot of money :(


Lifeisagarden_Digit

The comparison to the USD protocol as the 'house' of a casino that always wins only makes sense in a world where they can maintain control of the production of the unit of account and control of the underlying assets (formerly gold, now sovereign debt etc..). That control is maintained by physically preventing people from using superior savings devices such as gold historically. Executive order 6102 signed by Roosevelt in 1933 confiscated gold from all citizens and allowed for the full centralization of the monetary system. If they were not able to gain physical control of alternate forms of money it would not have been possible for them to perpetuate the system that led to today. The Fed and the IRS don't deal in money, they deal in currency. They *control* money (monetized assets with no counterparty risk profile such as gold) to control the currency market, currency being the scaling mechanism for assets. It is now free floating and captured by the state, but ultimately the dollar has no value even to them unless they maintain physical control of the asset base. Bitcoin is a base layer monetary asset in addition to the protocol itself, and without the ability to assert physical control the USD system will have to directly compete with it in the coming decade. the strategies that helped them erect and maintain the current status quo will not work against this new asset. People will naturally gravitate towards the money that serves the function of money best, and it is only through force and coercion that this is stopped as it has been for the past hundred years. Bitcoin has many intrinsic use cases, it's the asset and the protocol at once. Ledgers have a use case, encryption has a use case, storing and securing information has a use case, communicating information has a use case, measuring value has a use case. Bitcoin is information and information is useful and valuable in direct proportion to its reliability and applicability to one's goals. There is nothing wrong with having to pay taxes on Bitcoin in theory either, though in the near term tax law will likely be weaponized against Bitcoin in a vein attempt to curb it's growth. that attempt will achieve nothing in the long run. I agree that the U.S. has become a lot like China under the hood, and not in the best of ways. Doesn't matter to Bitcoin, slowing adoption rate by threatening people and making authoritarian regulation will drive Bitcoin away short term maybe. It's a global utility though, and globally it will continue to grow independent of the decisions of any given nation state. Blockchain is a large constituent part of Bitcoin, but it is not the defining element. The proof-of-work consensus mechanism operated by the miners and the node operators validating is what makes bitcoin what it is. If all it takes to be like the IRS is to verify transactions then yes it just like the IRS, and so are so many other things that it's a meaningless statement. The way verification is conducted is vastly different and more reliable. It is competitive, global, open, and permissionless where the IRS is king of it's own sandcastle, only in the US, closed off, and highly controlled by a select few with little accountability. It does not matter if blockchain is used or not by centralized entities, because blockchain is just a slow cumbersome database structure whos only purpose in bitcoin is the create certainty within the network by ordering events chronologically and securing it with cryptographic hashes. It serves it's function well there and assists the decentralization, but any centralized entity that uses it is only handicapping themselves. Without the benefit of decentralization it's drawbacks are only a hinderance to someone like a bank or government, they are welcome to use it. Alot of States on the authoritarian bandwagon are going to lose alot of money :)


Steve_Dobbs_69

Ah ok, So the analogy of the government seizing gold and seizing bitcoin have nothing in common. You're obviously invested in bitcoin...:(


Lifeisagarden_Digit

I am invested, no need to hide that. I've given it a lot of critical thought and continue to do so in the interest of risk management. I know how the protocol functions at a fundamental level, including the cryptography used to secure against censorship, disruption, and seizure. You seem to be under the impression that the State can simply take Bitcoin as easily as they could do so with gold or other assets, that is not the case. One part of bitcoin's value proposition is the fact that if properly managed it cannot be seized anymore than the information in your mind can be seized. there is simply no realistic way any public institution could hope to confiscate Bitcoin at scale from a population, all they could do is go after public exchanges or things like that. It works differently, it has a smaller attack surface. You can't just seize it like you can with other things.


Steve_Dobbs_69

>You seem to be under the impression that the State can simply take Bitcoin as easily as they could do so with gold or other assets, that is not the case. One part of bitcoin's value proposition is the fact that if properly managed it cannot be seized anymore than the information in your mind can be seized. [IRS bitcoin seizures](https://www.cnbc.com/2021/08/04/irs-has-seized-1point2-billion-worth-of-cryptocurrency-this-year-.html) [Bitcoin hacks and frauds on record highs](https://markets.businessinsider.com/news/currencies/cryptocurrency-hacks-fraud-cases-record-bitcoin-ethereum-wallets-breaches-defi-2021-8) [Cryptocurrency heist](https://www.cnbc.com/2021/08/11/cryptocurrency-theft-hackers-steal-600-million-in-poly-network-hack.html) [Real victims](https://www.bbc.com/news/technology-58331959) Do your research before investing in something that looks worthwhile lol. Blockchain is a good idea however, bitcoin is just going to be sidelined to the dark net, even then it will fail and get seized up by the house :) What people don't realize is the USD wins in all situations good and BAD.


Lifeisagarden_Digit

To be clear I do not advocate for 'Crypto' but Bitcoin specifically as it's the only one that is actually decentralized and secure. I have done my research, you are missing the point. Servers can be seized, files can be seized, small networks/domains can be seized. Bitcoin is none of these things. The ONLY way to access bitcoin is the have the private key. If this key is sloppily stored on an exchange, private server, or whatever else then it is vulnerable. If it is **properly** stored on a hardware wallet with a secure element there is no way for seizure to occur. The security encryption is based on the SHA256 hash function, the same that secures military intelligence for all major nations states on earth. Private keys are generated through ecliptic curve cryptography, the level of information entropy in a bitcoin key pair is extremely secure. the bitcoin computing network as a whole is the most secure network in history of it's size with zero breaches in it's lifetime. [IRS Bitcoin seizures](https://www.cnbc.com/2021/08/04/irs-has-seized-1point2-billion-worth-of-cryptocurrency-this-year-.html) \- Most of these are batches of litecoin or BCH, different assets I have no interest in. The seizure of Silk roads assets was due to storage of the private keys directly on the servers, sloppy. It was also before the implementation of the BIP39 improvement which introduced seed phrase storage methods. None of these instances are suggestive of a security gap in the Bitcoin protocol or a vulnerability to seizure. [Bitcoin hacks and frauds on record highs](https://markets.businessinsider.com/news/currencies/cryptocurrency-hacks-fraud-cases-record-bitcoin-ethereum-wallets-breaches-defi-2021-8) \- This is simply talking about the prevalence of fraud/deception and the hacking of centralized exchanges/services that deal in bitcoin like Mt. Gox. This is activity that occurs **around bitcoin, not on it.** [cryptocurrency heist](https://www.cnbc.com/2021/08/11/cryptocurrency-theft-hackers-steal-600-million-in-poly-network-hack.html) \- This isn't even Bitcoin, it's the Poly network. A centralized block chain that uses proof-of-stake as it's consensus protocol, sacrificing decentralization and security in favor of speed. bitcoin uses proof-of-work, an entirely different system based on the SHA256 hash function [Real victims](https://www.bbc.com/news/technology-58331959) \- Again, all of these instances were breaches of centralized private exchanges or other derivative centralized block chain projects. No seizure of secured bitcoin. [Pipeline hack](https://www.cnbc.com/2021/06/08/fbi-likely-exploited-sloppy-password-storage-to-seize-colonial-ransom.html) \- Here is another one ill add myself, the colonial pipeline hack where it was falsely reported that a bitcoin wallet was breached by the FBI. In reality the hackers simply stored their private keys on a hosted server which the FBI seized. Sloppy. You can read a breakdown of everything that happened through on-chain analytics here if you are interested: [Chain analysis](https://blog.wolfram.com/2021/06/09/darkside-update-the-fbi-hacks-the-hackers/) All of these instances are either unrelated to Bitcoin itself, the result of plain sloppy handling, or a breach of a centralized private exchange that brokers bitcoin. My conviction in this technology is not based on sentiment, I know how it works. When proper precautions are taken, you cannot seize it. Nobody can. I challenge you to come up with a way to replicate a 256 bit Elliptic Curve key signature or break the SHA256 hash function. I'll wait. In the meantime Bitcoin continues to grow at a faster pace than anything else in history by most metrics and there is no sign of it slowing down. USD is on the verge of a deflationary spiral unless we keep printing ourselves into hyperinflation. Time will tell, but Bitcoin isn't going anywhere and the dollar has no way of fighting it.


RobleViejo

Watch Mr Robot. There is a million ways for rich people to use crypto currency to fuck everybody else, and they will, be sure of that


passinghere

I refuse to touch crypto for the very basic reason that having £10 now means it'll still have £10 in a few weeks time if I don't touch it, while with crypto that £10 could well be worth £1 so the complete lack of stability makes it a non-starter as a general currency for use. > They represent something which for the consumer won’t be able to lose value Utter BS as the rates constantly change and you can easily lose the value of your "investment"


TheBlueMango01

*Very good point*, thank you for bringing it up, indeed right now bitcoin is SUPER volatile and it’s a VERY dangerous asset to hold. BUT, the reason for it being so volatile is because it’s still in its infancy stage, and still growing. People are discovering bitcoin slowly, and once they see massive growths there’s massive sell offs and then people buy back, rince and repeat. *However* what’s important to note, is, as time goes on the volatility will decrease dramatically (it already has). For example, it’s predicted in 10-20 years bitcoin will hit 1 million usd valuation. The current valuation of bitcoin is 50k. Let’s imagine a swing of 50k in either direction for bitcoin. Which today sound absolutely ridiculous. That would represent a 5% move. 5% moves are nothing. After all that’s basically the swings on current forex pairs. It will be like trading usd for eur. So on the short term I 100% agree with you, but over the next decade/decades no, I do not.


Lifeisagarden_Digit

You are confusing the number of units with the value itself. If you have ten things and you value them all equally you could assign a numerical value to each and say each is worth 1 unit of value. or 1$ to make it more relatable, same thing. If we have one unit of account for each unit of value we would have 10 units or 10$. If we then increase the amount of units of account we have, similar to printing money in real life, then the numerical value you assigned to each of the ten items as well. When there is 10 value and 10 units, then 1 unit = 1 value. If there is 10 valued items but now 20 units of account due to printing or some such then 1 value now = 2 units. this is how inflation works. If If you had 10$ and wanted to buy an item it'd be 1$, after the increase in supply to 20 you would still only have your original 10$ but each item would now cost 2$. you have lost 50% of the purchasing power of your money as a direct result of the increase in the number of total dollars. the number is still the same though, you still have your 10$. Problem is you can only get half as much for it now. ​ Bitcoin is an asset and it is reasonable to want to avoid volatility in the market for it, similar to how gold is volatile. The units in Bitcoin do not increase beyond 21 million, they can't. So the point is not that it would make better everyday grocery money. the point is that it enable you to save money without the loss of purchasing power over long periods of time. Bitcoin is like a savings account not a checking account. If you are worried only about the next couple months then you don't need it at all. If you want to make sure you still have the same value in 10 years then scarce assets like land, gold, stock, or Bitcoin are your only option to avoid inflationary debasement of your cash holdings.


passinghere

> If you want to make sure you still have the same value in 10 years then scarce assets like Bitcoin are your only option yeah ok enjoy your fantasy


Lifeisagarden_Digit

Well you certainly can't use cash. You can put your life saving in paper notes if you want but it'll buy a whole lot less in 10 years. If you don't like bitcoin that's fine. land, commodities, stocks, etc are all still options. I prefer bitcoin because it's the most scarce, secure, and transportable asset. however if it's not something you are interested in you should still look into some kind of asset allocation if you want to preserve your wealth long term. That's just good financial sense whether you like Bitcoin or not


passinghere

Oh look your "stable" currency having yet another crash in value, what a fucking surprise. https://old.reddit.com/r/technology/comments/prv389/bitcoins_price_is_plunging_dramatically/


Lifeisagarden_Digit

Looks at it's history, this is nothing. I would never argue that Bitcoin is stable in price, it's extremely volatile in the short term. I also don't believe it's a currency, those are for transferring value quickly over distance and will do nothing for you in terms of savings. Bitcoin is a monetary asset similar to what gold used to be but it's in it's growth phase. It main purpose is a reliable, LONG TERM store of value and acting as censorship resistant property. All high growth assets are extremely volatile including tech stocks, high yield corporate bonds, etc. It's a neutral sign of price discovery over time and won't go away until mass adoption evens out the market demand. Long way off from that in linear terms, however statistically speaking it's the best performing asset in financial history and shows no sign of slowing down. The largest institutions in the world are getting involved. It was adopted by a nation state as their reserve currency after just 12 years. It's got a faster growth rate than the internet itself did in the 90's. It's not 'crashing' to those who actually know how it works instead of listening to mainstream hype and making assumptions. It's on sale. Only time will tell what the future holds for Bitcoin, but in the meantime you can continue to confidently dismiss this opportunity even though you don't even know what it is or how it really works. That will make you feel better at the very least. You can do whatever you want, but im buying more today.


ClF3ismyspiritanimal

The fact that it costs more energy to produce than it can possibly be worth means it has literally failed at the one essential requirement for currency, that it must be a functional stand-in for something of actual value. Which isn't to say that most governmental currency doesn't also suffer from "pay no attention to the man behind the curtain" issues, of course. But Bitcoin is just another fiat currency that has value literally only because a lot of people have agreed to pretend it has value, but it consumes vast amounts of resources just to generate it and produces only waste as a consequence. It might have some value to the extent it can be used for anonymous transactions, but if the NSA wants your ass, it'll get your ass, so the extent of that value is questionable. Otherwise, it's not much different from dollar bills, if each dollar bill consumed a small forest to print.


Mus_Rattus

Seems crypto salesmen are everywhere these days. Bitcoin has an awful lot of problems in my view. It has no utility value - that is, you can’t do anything with it in the real world except use it as a unit of exchange. You can’t eat Bitcoin or build a house out of them or whatever. Of course dollars have no utility value either. But dollars are far more useful than Bitcoin currently as a currency. I can’t go to Sears and buy jeans with Bitcoin, or get a cup of coffee at my local coffee shop, or order a pizza with it at almost any establishment. Dollars also can’t be hacked out of your wallet by someone in Uzbekistan and stolen instantly and without any recourse. Dollars also don’t require a massive energy infrastructure to keep track of where they are at all times and you can spend a dollar even if there is no electricity. Etc. Bitcoin is less useful than a dollar and carries more risk.


TheBlueMango01

Fordi of all you say it has no utility value. Which some people would agree, however against other currencies, i would argue that it does. The entire premise of using bitcoin is that you’re able to use it, instantaneously, anonymously in a transparent system, and with the impossibility of double spend. Something as of now other forms of governmental currencies cannot follow. So to a certain degree I would say, yes, as a medium of exchange it has value. Of course you can’t build houses on it but that’s it. Around the fact that you can’t buy anything with crypto or bitcoin. That’s not true anymore if you go on crypto.com you can very easily open up yourself a crypto account with a crypto card and pay in whatever cryptocurrency you want. However, one could argue you don’t send bitcoin, because it’s just the system selling your bitcoin into dollars and from which it sends the money to Sears, or whatnot. Nevertheless, bitcoin acceptance is slowly becoming more and more real, El-Salvador has already accepted it as legal tender, and you can now go to any shop there and pay directly in bitcoins to each other, and Cuba will be following that road shortly. Do I think this is a good idea currently? No. Bitcoin right now is still in its growth and infancy phase, it’s still too volatile. However give it 10-20 years and I think at least in developing countries where inflation is a major issue, it could very well come into place. Either as a form of pegging their currency to bitcoin/other crypto or as using directly as a means of exchange. As for the hacking part, unfortunately it’s a massive misconception with crypto… the only reason you’d get hacked is if you revealed your private key (which is your unique identifier but which allows you to make transactions. Those who get hacked, have given it away, in the same way people pay for scammed items online with their credit card, or their card gets stolen and someone empties their bank account. It isn’t any riskier on that front. As for the electricity, to a certain degree you’re very much right. But again, facing the future, will we really be using paper money in 20 years time? I worked myself in a danish supermarket, and I can tell you the only people who used cash with me were old people. Even the young generations were nearly all using cards or their phone with Apple Pay. I’d say the ratio of electronic/paper money is probably 30/1. Of course that’s not accounting for different cultures and environments. Maybe in my city that’s normal but in a rural village it’s different. But I still do stick to the premise that in the not so distant future paper money will disappear. (There also arguably political reasons to switch entirely to digital money, but I think it’s a bit off topic so I’ll leave that there ahah)


Mus_Rattus

No, it doesn’t have utility value because utility value (at least the way I have used it in this thread) means you can do something with it besides exchange it for other things. What you are talking about is exchange value. Maybe it’s better than other currencies, but you still can’t wear it or build a house out of it (etc.) so it doesn’t have utility value. You already proved my point with the crypto card thing. That’s just a service that exchanges your Bitcoin for dollars or other currency and then sends that currency to Sears. It doesn’t mean that Sears is accepting Bitcoin, as you know. As far as hacking goes, I understand the concept of private keys. But I also understand the concept of a key logger or other hacking tools that can be used to acquire your key. If someone hacks your credit card, the bank can reverse the transactions in some cases or will just eat the cost. Not so with Bitcoin. I also note that Bitcoin and other crypto currencies have made it a lot easier for ransom ware attackers to extort millions of dollars from companies and other organizations. Without crypto it would be next to impossible to force a company to send such large amounts to Russia or other far away lands in an irreversible transaction. But the energy thing is my main objection to Bitcoin. With climate change worsening every year, I think it’s frankly insane to suggest switching from the working currency system we already have for a much more energy-expensive one. I get that people use credit or debit cards but Bitcoin seems to be much less energy efficient. Here is a source that says a single Bitcoin transaction consumes as much energy as thousands of Visa transactions: https://www.statista.com/statistics/881541/bitcoin-energy-consumption-transaction-comparison-visa/. Yes Bitcoin isn’t subject to inflation the same way fiat currency is. But my point is it has its own problems that the current currency system doesn’t have. And I tend to think the benefits of Bitcoin are outweighed by the costs.


HumorImpressive9506

I think one of the things people who have high trust in bitcoin forget is that something even better could come along tomorrow that is even better and is as different from bitcoin as bitcoin is from fiat. Before bitcoin no one even imagined it and now we cant imagine what and how something could be better. I like bitcoin and own about two months worth of salaries but I dont think we are even close to seeing something that could replace government issued money.


TheBlueMango01

I disagree, there’s literally documents from different governmental agencies in the 60s describing how a concept like bitcoin could emerge in an interconnected world. Then there are plenty of economists who predicted it in the 80s and most notably the 90s. Like Peter Thiel a famous economist here predicting bitcoin in 1999: https://youtu.be/8PM_g3u_cAw I think if you know anything about bitcoin you’d realize that this has been a concept in the making for years and years and years. But the technology to create a decentralized ledger, in which one could make instantaneous transactions from the tip of your finger on your smartphone to anyone, in a both transparent and anonymous system whose double spending is impossible thanks to cryptographic technology, until the invention of the internet-connected phones and computers, been impossible. If you can come up with an alternative system to cryptocurrencies that could fulfill its use case , I would gladly hear it.


HumorImpressive9506

I think you are missing my point. I could just rephrase it then: before the 60s no one could even image something like bitcoin. What I am saying is that something better than bitcoin could come and we cant even image how it would work. It can come tomorrow, it can come 50 years from now. 10 years from now some new chip technology could mean we can have quantum technology in our cellphone for example, who knows what possibilities that could lead to. Like I said, I like bitcoin and anything that challenges the government is good but I dont see bitcoin as the be all end all.


TheBlueMango01

Okay I get where you’re coming from now, I think like all things it will rise and fall, but I do see it as a possibility to be for example a pegged usd on bitcoin. Of course, like with gold, and the pieces of clay, it will at some point cease to exist and. Be replaced by it. But I don’t necessarily see that happening in the foreseeable future.


Lifeisagarden_Digit

If something is considered to be better than Bitcoin it must therefore solve the same problems and serve the same functions better. The functions are to maintain a set supply schedule, resist censorship, and survive. It is simply a protocol, not a whole program as you might imagine most bits of computer software. It is also not static, soon in November it will be getting an upgrade that unlocks a lot of new capabilities, and anytime a change is adopted by %90+ of users it will adapt further. Money is just a measurement of value, and as long as people agree on what the unit of measure is there is no reason to change it. why do you think feet and miles are still used even though it makes math more of a pain in the ass compared to metric? There is also the idea of path dependence to consider. this is when systems become entrenched over time as they are used, increasing the cost of replacing them as measured in time and effort each year that passes. We can see this in things like wall sockets, they are all different all over the world and nobody is going to change them because it would cost more than it's be worth. Not to discount the possibility of it being replace of course, anything is possible. We could for example replace English with Logban, an new language developed with the modern age in mind and efficiency at its core. We both know it won't happen though, the social protocol that is the English language simply has too much path dependence. Path dependent systems are not replaced by moderate incremental upgrades, only displaced by radical changes that make the old system obsolete. If anything were to replace Bitcoin it would not be another Cryptocurrency, it'd be another radical shift in the nature of money like bitcoin is a radical shift from Fiat money.