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Merged Bitcoin - Part 3

psionl0 said:
Are you really going to stick your neck out like this after the thorough humiliation of the people who were posting here 2-3 years ago?
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Why not? Sampson told me the law of infinite supply compels a price of $0.00 for all crypto currency. Why abandon ship now?
 
a_unique_person said:
If everyone agrees BTC is worth $40,000 then everyone has gained. It's not a zero sum game in that sense. Stocks and shares do that as well.
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Nonsense. Stocks and shares are based the real worth of businesses, not pure fantasy like Bitcoin. It is 100% a zero-sum game.

psionl0 said:
Bitcoin shot past the $30K barrier in the last couple of hours and if past bubbles are any indicator, this might only be the beginning.
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Beginning of what? Another huge bubble that will burst as dramatically as it appeared?

Anyway it's too little too late.
 
Roger Ramjets said:
Nonsense. Stocks and shares are based the real worth of businesses, not pure fantasy like Bitcoin. It is 100% a zero-sum game.
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The value of stocks and bonds can be rooted in fantasy. History has demonstrated this. If the value of BTC does not go down because it offers some service that no other business provides, it will stay up. At the moment speculation and criminal enterprises seem to be the major backers. Since no other CC comes close to BTC then maybe BTC is all that is needed to meet that demand.
 
Roger Ramjets said:
Beginning of what? Another huge bubble that will burst as dramatically as it appeared?
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Yes the bubble will burst (and water is wet) but that is meaningless drivel unless you can give a time frame or a peak price.

BTW The price crash is never as "dramatic" as the price rise. Historically, after the crash, the price has never fallen below the peak price of the previous bubble.
 
a_unique_person said:
The value of stocks and bonds can be rooted in fantasy.
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The operative word being can. It's rare with bonds and takes something like the sub-prime housing market crisis but stocks can be under or over valued for years or even decades. In the long term though they track with earnings and\or expected earnings. Bitcoin has zero earnings so it's long term value is zero.

Commodities don't have earnings and track with demand and availability. More people want to use the commodity to make things or to simply consume and the price goes up. If there is more supply then there is consumption then price drops. Again thought Bitcoin can't be valued this way because people don't consume it or use it to make anything.

Currency is also valued based on supply and demand but in this case the supply\demand balance is maintained by central bank action, the velocity of money and national current accounts balance. This doesn't quite apply to bitcoin though you could approximate capital flows in and out of criminal endeavours as current accounts balance so it gets some value there.

Overall though the things that real investment vehicles derive their value from don't apply to bitcoin. Overall its like the value of stocks after the company is bankrupt. They are worth nothing but can continue tor trade and people can even make a profit of the volatility.

Wrt to the current bubble, with the increasing dominance of just a few major players over the last couple years I'm going to say the current increase is market manipulation.
 
lomiller said:
The operative word being can. It's rare with bonds and takes something like the sub-prime housing market crisis but stocks can be under or over valued for years or even decades. In the long term though they track with earnings and\or expected earnings. Bitcoin has Used stamps have zero earnings so it's their long term value is zero.

Commodities don't have earnings and track with demand and availability. More people want to use the commodity to make things or to simply consume and the price goes up. If there is more supply then there is consumption then price drops. Again thought Bitcoin used stamps can't be valued this way because people don't consume it them or use it them to make anything.
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ftfy.
 
a_unique_person said:
Blockchain is a good and bad concept. I'm BTC it is a part of the scaling problem.
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Blockchain is a solution in search of a problem. It's interesting but ultimately unnecessary because there are almost always other ways to do the same thing and they are usually simpler, better or both.
 
psionl0 said:
ftfy.
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Ironically I completely agree.

Meaning: you seem to be confirming that BTC is a speculative purchase rather than a currency, like beanie babies or stamps. This is where I position BTC in the universe of 'investing': greater fool theory, ie speculation and betting.

Worth mentioning that there's a disanalogy that I also deploy for hoarding vs collecting: can you *display* the inventory? If the person is stockpiling Star Wars figurines, but they're displayed to share and enjoy with friends, I don't consider it hoarding.

Likewise, if the person is displaying their stamp collection, I don't consider it investing or trading, so much as enjoying an intrinsic property of the object.

BTC fails the 'display' criteria, so generally, I don't consider it a collectable like stamps. It's entirely greater fool theory speculation, in my opinion.


And at the moment, it even fails as a currency substitution for most people. The floating value of fiat currency is a feature, not a bug. BTC is in a deflationary spiral right now, which means people are hesitant to spend it. Economies have been damaged by deflation because it motivates currency hoarding and slows down the velocity of trade.
 
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lomiller said:
Bitcoin is neither artistic nor is it collectable in any way. Any more lame arguments you want to try?
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There is no need. You win the lameness competition by a country mile.

What you are doing has been done ad-infinitum since the bitcoin threads first started. You pretend that bitcoin has no history (it only appeared yesterday) and make up "reasons" why bitcoin will never amount to anything.
 
blutoski said:
Ironically I completely agree.

Meaning: you seem to be confirming that BTC is a speculative purchase rather than a currency, like beanie babies or stamps.
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I have never said anything else. Some libertarians in the past have speculated that you could buy pizza with bitcoin and there have been examples of merchants accepting payment in bitcoin but because it doesn't scale, it will never be an everyday currency.

blutoski said:
This is where I position BTC in the universe of 'investing': greater fool theory, ie speculation and betting.
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The use of the words "greater fool" are meant to imply "ponzi" but all it means is that someone buys something primarily because they believe that they will be able to sell it at a higher price later on.

This "theory" can also apply to real estate, some stocks and (of course) collectibles. This is especially so if the price of the item has been bid well beyond what its value as a utility might be. The "fool" aspect only applies if it is inevitable that at some point, the price of the item in question will collapse permanently.
 
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psionl0 said:
I have never said anything else. Some libertarians in the past have speculated that you could buy pizza with bitcoin and there have been examples of merchants accepting payment in bitcoin but because it doesn't scale, it will never be an everyday currency.


The use of the words "greater fool" are meant to imply "ponzi" but all it means is that someone buys something primarily because they believe that they will be able to sell it at a higher price later on.

This "theory" can also apply to real estate, some stocks and (of course) collectibles. This is especially so if the price of the item has been bid well beyond what its value as a utility might be. The "fool" aspect only applies if it is inevitable that at some point, the price of the item in question will collapse permanently.
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Understood. There's a continuum between 'secondary market' and 'greater fool' and in my opinion, it's about whether it's adaptively managed and revenue generating, ie does it 'make money' and if it doesn't suddenly, are there people at the helm who can right the ship. Stocks are pieces of ongoing businesses, they make money. Most real estate makes money. Collectibles do not. As such, I categorize BTC as a collectible or currency.

Generally, my pushback on the BTC discussion is isolated to claims that it is an investment (as opposed to speculation), and that it's a superior currency. It's a garbage currency, although it has a niche in the dark web for illegal transactions, because the utility of easily accessible anonymity creates value over many other currencies. It's the easy access that's important: gold, diamonds, &c could do the same, but it's a hassle for microtransactions.

But yes, out in the massmarket, it's an inferior offering. And especially right now. Who would buy a pizza with BTC today if they genuinely thought they could buy two pizzas with the same amount next Friday instead? This is what damaged the Japanese economy for the last 30 years: currency deflation is an economy killer.

The defense of BTC switches back and forth about claims of it being an 'investment' when it's rishing; but when it's falling, the discussion pivots to it's 'the future of currency' - realistically, the magnitude of value fluctuation in and of itself tells me it's ***** as currency, and simultaneously, that it's not investing either, it's speculating.

Which is not an argument against participating - just that the participants hopefully are not fooling themselves, and also not misinforming others about what we're dealing with. It's beanie babies, just admit it, and keep on trading. There's money to be made in arbitrage and guessing right. Personally, I prefer blackjack.
 
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psionl0 said:
There is no need. You win the lameness competition by a country mile.

What you are doing has been done ad-infinitum since the bitcoin threads first started. You pretend that bitcoin has no history (it only appeared yesterday) and make up "reasons" why bitcoin will never amount to anything.
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Bitcoin hasn't amounted to anything. If you think that will change it's up to you to offer reasons why.
 
psionl0 said:
The use of the words "greater fool" are meant to imply "ponzi" but all it means is that someone buys something primarily because they believe that they will be able to sell it at a higher price later on.
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All three of these are different. A Ponzi scheme is a specific type of rip-off. Wrt investing some investments can reasonably be expected to go up in value, others should not have such expectations. Greater fool investing refers specifically to the latter.

Furthermore even something that is the subject of greater fool investing can have underlying value. For example take a bond that NPV calculations say is worth $1000, and someone buys it for $5000 because they believe they can sell it later for $10000 is still engaging in greater fool investing.


psionl0 said:
This "theory" can also apply to real estate, some stocks and (of course) collectibles.
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Bitcoin is not compared to these. Buildings have real earnings and you can also look at the location and surrounding growth to anticipate what the demand for that parcel of land will be. Stocks also have future earnings that can be used to anticipate it's future value.

Collectables are bit different from stocks and bonds but anyone who has ever collected anything can tell you that items made specifically as collectables rarely increase in value. Accidental curiosities aside, the things that do increase are the ones that get used intensely so they wear out then people go back and want them for nostalgia reasons later in life.

Again, none of this applies to bitcoin.
 
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