Author Topic: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion  (Read 168537 times)

sol

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1050 on: March 01, 2018, 01:59:46 PM »
We already had this discussion. Crypto is double-edge, just like the internet, science, weapons, medicine, any other technology.

I don't think it's at all analogous.  Science and the internet and medicine are all pro-social ideas.  They can help societies thrive by making life better.

Cryptography doesn't advance the interests of civilized society.  It can't be used to build trust and cooperation, to facilitate progress, or to help people live better lives. It can only be used to do the opposite.

Maybe weapons are a better analogy?  Weapons are designed to kill people, and we sometimes use them to kill people in order to protect the rights of other people, but I feel like that role should be reserved to the state.  I don't want every citizen to have RPGs locked and loaded by the front door, or claymores around the perimeter of their lawn, or sarin gas in their refrigerator.  These things are destructive tools that should not be widespread among the public, but reserved for use in exceptional cases by a democratically elected representative government.  And basically prohibited to everyone else, because they are powerfully evil.  They do not serve society by becoming widely distributed.  You don't make society better by giving out sarin nerve gas.

I can see a legitimate governmental use for perfect unhackable cryptography.  I don't see many legitimate private uses yet, but I sure do see a whole bunch of illegitimate and dangerous and illegal ones.

If cryptography fundamentally undermines the basic social contract on which civilization is built, do we really want everyone to have unlimited access to it? Do we really have a choice anymore?

shadow

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1051 on: March 01, 2018, 02:13:06 PM »
Cryptography doesn't advance the interests of civilized society.  It can't be used to build trust and cooperation, to facilitate progress, or to help people live better lives. It can only be used to do the opposite.

Cryptography underpins digital infrastrastructure. The modern internet would not function without cryptography. Cryptography has enormously advanced the interests of civilized society and has added trust in areas where there wouldn't be any.

Regarding the blockchain, it is not protected from any method a government agency currently has to decrypt or bruteforce encryption. Blockchain makes use of cryptography for non-intermediary transactions.

 

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1052 on: March 01, 2018, 03:18:00 PM »
I can see a legitimate governmental use for perfect unhackable cryptography.  I don't see many legitimate private uses yet, but I sure do see a whole bunch of illegitimate and dangerous and illegal ones.

If cryptography fundamentally undermines the basic social contract on which civilization is built, do we really want everyone to have unlimited access to it? Do we really have a choice anymore?

I wouldn't go that far.  Your web browser uses security hash algorithms to make secure connections.   Most likely the same one that Bitcoin relies on.  I agree with your point about trust and the social contract, but security is important too.  That's why we have locks on our doors, and our online banking is protected by passwords.  We constantly hear stories how Target (or whoever) was hacked and the thieves stole 20,000,000 credit card numbers.  How come those numbers weren't encrypted?   If they had been encrypted they couldn't have been stolen.  Security helps keep out the bad actors, and that allows us to trust things like credit card transactions. 

But back to your point on trust.  All money is a figment of our imagination.  We just all believe it to exist...and there it is.  But people don't really believe in Bitcoin.  How do we know?  Because the price compared to something we do believe in, the USD, changes radically over time.   And that's the fundamental problem.  People don't really believe in it. 


Surf

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1053 on: March 01, 2018, 11:46:53 PM »


FWIW in order to liquidate our stock positions, a "bigger fool" must be present to buy them.  I understand what you are saying about investing, this is an unconventional asset class. Purchasing btc is a bet that the future userbase will be larger than it is today, or as a hedge that potential future timelines where the userbase is larger are also timelines where traditional assets are struggling.

I have seen variations of this falsehood being repeated over and over by the pro-crypto bunch.  People who invest in the stock market do not require greater fools for their investment to be successful.  A share of stock entitles the owner to a share of future earnings of a company, or in the case of an index fund, all of the companies represented on the index.  The share of future earnings is realized by the payment of dividends and as an accumulation of retained earnings which will accrue to book value and as investments in future profitability of the company.  The stock price is a market-based discounting mechanism of the net-present value of those two things, nothing more.  Usually the price is an accurate representation of the NPV, but it can swing in one direction or another from time to time.  In the same way that a person who buys a whole company can be a perfectly successful investor without ever selling it -- because all of the profits are his own and he can sell an asset of the company, e.g. a forklift, and pay himself the proceeds -- a person who buys a share of a publicly traded company on the stock market can also be a perfectly successful investor without ever needing to sell.

The continued argument from the pro-crypto bunch that in order for an investment in the stock to be successful an ever expanding pool of "greater fools" to come in and buy at a higher price is needed is a naive and unsophisticated understanding of stocks and a stock market and it exhibits a fundamental lack of understanding of the nature of investment.

I am aware of the functioning of stocks, and I own plenty.  You disagreed with something I didn't say.

http://www.businessdictionary.com/definition/equity-investment.html
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Money that is invested in a firm by its owner(s) or holder(s) of common stock (ordinary shares) but which is not returned in the normal course of the business. Investors recover it only when they sell their shareholdings to other investors, or when the assets of the firm are liquidated and proceeds distributed among them after satisfying the firm's obligations. Also called equity contribution.

I said in order to liquidate your investment you must have someone to sell the shares(or have the firm liquidate all its assets, whatever's left after satisfying their debts).  I didn't say you had to liquidate them in order to be profitable.

The illustrative point is that if all the future stock investors disappeared those who were left holding shares would have no way out(without the company liquidating.)

Surf

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1054 on: March 02, 2018, 12:06:05 AM »
I hate to burst your "scientific" bubble here, but the stock market (and the larger economy that it is a rough proxy for) is not at all a zero sum game. Why on earth would you think that?

-W

Whew I put up a LOT of information there and the two direct replies were either a complete misreading (first one) or harping on an ancillary point that again actually misreads what I wrote.

I should have included "trading" or "competing" for clarification.  My sentence about zero-sum stands, though.  Individual trades in the market are zero sum, one person buys, the other sells, no new money is created.  Technically slightly negative sum as a fee is extracted.  If you are trading all day you are participating in a zero sum environment vs other entities and you best make sure you are in the top half.

The second half of my statement "which grows over time" indicates that the buy-and-hold aspect of the stock market is NOT zero sum.  Companies gain value and that value is transferred to the stock owners.  That's why we all own stock funds.

@waltworks  Any thoughts on the (hopefully thought provoking) ideas I offered?

Surf

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1055 on: March 02, 2018, 12:16:16 AM »

But back to your point on trust.  All money is a figment of our imagination.  We just all believe it to exist...and there it is.  But people don't really believe in Bitcoin.  How do we know?  Because the price compared to something we do believe in, the USD, changes radically over time.   And that's the fundamental problem.  People don't really believe in it.

This is an excellent point, one I discussed recently after reading "Sapiens," which I recommend.

One could take an alternative perspective:  Despite the volatility, humanity has continued to believe Bitcoin is worth something.  To the best of my very limited knowledge no modern instrument has survived multiple speculative bubble pops and stabilized after each one.

It is a fascinating little experiment.  Value tied to adoption rate, adoption rate tied to utility provided.  Eventual utility level unknown as it is still in active development. 

Speculation mimics actual adoption and so sees surge in price, but provides no sustained utility to the network and eventually get-rich-quick-ers abandon ship.  This erodes confidence in btc as volatility increases and corrections/crashes ensue, but those who derive value from the network stick around and it eventually flattens out.

waltworks

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1056 on: March 02, 2018, 07:45:45 AM »
Whew I put up a LOT of information there and the two direct replies were either a complete misreading (first one) or harping on an ancillary point that again actually misreads what I wrote.

You did say that "the market always goes up" is "unscientific". Without getting into a philosophy of science debate, you are saying that you question whether the economy of the world/US will continue to grow (as, in the case of the world, it has since prehistory, albeit with some fits and starts), essentially. If you actually believe that, then yes, you will need either a metric ton of money, or some alternative investment/consistent winning in the now-zero-sum game in order to be FI.

Might just as well invest in fertile land and ammunition at that point, not "currency" that requires a ton of energy and computers/internet access just to use/spend, but everyone's different. 

-W

trollwithamustache

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1057 on: March 02, 2018, 08:08:17 AM »
I can see a legitimate governmental use for perfect unhackable cryptography.  I don't see many legitimate private uses yet, but I sure do see a whole bunch of illegitimate and dangerous and illegal ones.

If cryptography fundamentally undermines the basic social contract on which civilization is built, do we really want everyone to have unlimited access to it? Do we really have a choice anymore?

This seems a bit melodramatic.  why can't your thoughts be private?

With the internet providing a stored record of everything, my kids thoughts aren't private anymore. All the stupid shit I thought and said growing up, as a teenage, in college is behind me and there isn't any Facebook timeline of.  Now, if I am interested in an obscure topic and research it a bit, all of my banner adds change to match .    if cryptography gives the privacy to explore an idea before you decide if you like it or not that's something I support.

Surf

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1058 on: March 02, 2018, 09:14:34 AM »
Whew I put up a LOT of information there and the two direct replies were either a complete misreading (first one) or harping on an ancillary point that again actually misreads what I wrote.

You did say that "the market always goes up" is "unscientific". Without getting into a philosophy of science debate, you are saying that you question whether the economy of the world/US will continue to grow (as, in the case of the world, it has since prehistory, albeit with some fits and starts), essentially. If you actually believe that, then yes, you will need either a metric ton of money, or some alternative investment/consistent winning in the now-zero-sum game in order to be FI.

Might just as well invest in fertile land and ammunition at that point, not "currency" that requires a ton of energy and computers/internet access just to use/spend, but everyone's different. 

-W

The basic approach of the scientific method is to posit a hypothesis and attempt to disprove it.  There is no structural mechanism for proving something conclusively true.  This isn't philosophy, it's the bedrock of scientific reason that brought us out of medieval thinking.

What we can do is make statistical estimates about growth rates and volatility, and use confidence intervals to model a likely range of outcomes. 

What is true is that as growth rates shrink, and/or volatility increases, the wider a range of likely (95%) outcomes that include prolonged downturns or sideways stretches. 

Conflating the advancement of human civilization with the continued returns of the equities market is philosophical optimism, not scientific analysis.

As mustachians we have a core belief in restraint and conservation.  The world would be a vastly better place if there were a paradigm shift away from corporate profits and towards long term sustainability.  In some small way we are betting against our fundamental beliefs when we ride the backs of the corporations, many of whom do much to harm our species long term viability for short term gains.

We are financially incentivized to participate between tax advantages, corporate matching, and the simple fact that owning stocks is the best way to obtain a small slice of these short term gains. 

Ignoring the statistical risks, or investing from an illusory moral high ground, is not scientific.  We do it because it is likely to work, and having more money enables us to lead lives of value.

Surf

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1059 on: March 02, 2018, 09:20:22 AM »

I said in order to liquidate your investment you must have someone to sell the shares(or have the firm liquidate all its assets, whatever's left after satisfying their debts). 



No. This is not what you said.  You said that a "bigger fool" must be present.  This is simply wrong in the context of stocks.  Bigger fools are not required.

Maybe we have a misunderstanding here.  My exact sentence was that in order to liquidate your shares there must be someone to sell them to.  The concept of "bigger fool" is an emotional label that you used, and i re-used for illustrative purposes.  Are you saying that the people buying shares are not fools?  Because that's an issue of labeling. 

If you are saying they are not necessary, then how are you going to liquidate your assets without them?  I understand dividends and other mechanisms, but if you have 1M in an index fund and the market stops growing, and there is no one to buy your shares, where does that leave you? 

Just food for thought that you may not think you need "fools" but every time a 20something shows up and says "wow does this really work" her adoption of our collective investment strategy directly benefits us all.

waltworks

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1060 on: March 02, 2018, 10:23:02 AM »
The basic approach of the scientific method is to posit a hypothesis and attempt to disprove it.  There is no structural mechanism for proving something conclusively true.  This isn't philosophy, it's the bedrock of scientific reason that brought us out of medieval thinking.

Ok, so we're getting very metaphysical here, and maybe we'll have to agree to disagree - but there is no "science" in the sense you are talking about involved here. We are not doing experiments under controlled conditions or testing hypotheses. Rather, we are making educated statistical guesses about what will happen in the future based on what has happened in the past.

Even if you can start doing futuristic Asimov style psychohistorical science, what on earth makes you think cryptocurrencies are a good alternative to the stock market? You can certainly believe that stocks are going to all be worthless/return nothing going forward, but that really has nothing to do with crypto being a good alternative investment, does it? If you don't like stocks, there are bonds, real estate of both the arms-length and DIY varieties, direct lending of all sorts of levels of risk, business franchises, etc.

-W

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the_gastropod

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1062 on: March 02, 2018, 09:12:22 PM »

I said in order to liquidate your investment you must have someone to sell the shares(or have the firm liquidate all its assets, whatever's left after satisfying their debts). 



No. This is not what you said.  You said that a "bigger fool" must be present.  This is simply wrong in the context of stocks.  Bigger fools are not required.

Maybe we have a misunderstanding here.  My exact sentence was that in order to liquidate your shares there must be someone to sell them to.  The concept of "bigger fool" is an emotional label that you used, and i re-used for illustrative purposes.  Are you saying that the people buying shares are not fools?  Because that's an issue of labeling. 

If you are saying they are not necessary, then how are you going to liquidate your assets without them?  I understand dividends and other mechanisms, but if you have 1M in an index fund and the market stops growing, and there is no one to buy your shares, where does that leave you? 

Just food for thought that you may not think you need "fools" but every time a 20something shows up and says "wow does this really work" her adoption of our collective investment strategy directly benefits us all.

I don't want to speak for L.A.S., but I suspect they're referring to price vs value. Stocks have a value (ownership in a productive business). Cryptocurrencies have no value (in the economic sense—they're unproductive assets). Things with value can be priced at least somewhat objectively. There can, of course, be differences of opinion, but the price is ultimately grounded in reality. Valueless assets (cryptocurrencies, paintings, beanie babies, rare coins, etc.) have no rational basis for their price. They are speculative. Speculative investments depend on "bigger fools" to purchase them from you. Productive assets depend on rational actors.

waltworks

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1063 on: March 02, 2018, 09:24:28 PM »
It's worth noting that there certainly can be a scenario where nobody will buy your stocks from you, and you are screwed.

In the grand scheme of things, that's the asteroid-impact/zombie apocalypse scenario, though, so who cares? You're dead.

-W

misterhorsey

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1064 on: March 03, 2018, 05:37:08 AM »

I said in order to liquidate your investment you must have someone to sell the shares(or have the firm liquidate all its assets, whatever's left after satisfying their debts). 



No. This is not what you said.  You said that a "bigger fool" must be present.  This is simply wrong in the context of stocks.  Bigger fools are not required.

Maybe we have a misunderstanding here.  My exact sentence was that in order to liquidate your shares there must be someone to sell them to.  The concept of "bigger fool" is an emotional label that you used, and i re-used for illustrative purposes.  Are you saying that the people buying shares are not fools?  Because that's an issue of labeling. 

If you are saying they are not necessary, then how are you going to liquidate your assets without them?  I understand dividends and other mechanisms, but if you have 1M in an index fund and the market stops growing, and there is no one to buy your shares, where does that leave you? 

Just food for thought that you may not think you need "fools" but every time a 20something shows up and says "wow does this really work" her adoption of our collective investment strategy directly benefits us all.

There's definitely a misunderstanding in terminology here.

The greater fool theory is not an emotional label. The 'greater fool theory' describes a form of speculation. It's where someone buys an asset (and that can be crypto, tulips, stocks, bonds, real estate) and has a sincere belief that although that the price of that asset is no longer accurately correlated with the value of the asset, they are willing to buy it in order to sell shortly afterwards at a profit.  The speculator in this instance may believe the asset is priced well above it's value, or they may believe it has no intrinsic value.  However, they do not care. They are buying the asset, in order to sell it, to a 'greater fool' who will happily pay more for it.

Forgive me for citing wikipedia here: https://en.wikipedia.org/wiki/Greater_fool_theory

But when you sell stocks, you aren't necessarily selling them because you think they aren't worth anything, and want to offload them to a 'bigger' or 'greater fool'.  You may actually need to liquidate stocks for other reasons. For example, you can't buy food with stocks - and you might want to eat! So you sell some shares for cash.  You could also be in a position where you believe your stocks to be a certain value, where you believe that the value may well increase, but you still decide to sell these stocks.  This is simply liquidating a position from stocks to cash.  You may then use that cash to invest in a different asset class that may be more attractive for other reasons.

I could be wrong, but your post seems to suggest that the only time one would ever sell stocks is to liquidate your entire position.   Or if you no longer believe they are of value.

Another situation is where someone adjusts their asset allocation based on their age.  At age 70 it's prudent to adjust your asset allocation to more capital stable investments. You may decide to sell stocks in exchange for cash, but it's not because you don't believe they are of value but because you prefer the stability of cash over the volatility of stocks.  The buyer might be a 20 year old just starting out in investment. The value of the stocks remains the same - however what is appropriate for each investor is relative to their own life circumstances.

shadow

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1065 on: March 03, 2018, 09:05:21 AM »
Valueless assets (cryptocurrencies, paintings, beanie babies, rare coins, etc.) have no rational basis for their price.

Crypto has value. Dapps and other services require crypto; the form of digital social contract people are engaging in require crypto. People are using it as medium-of-exchanges.   

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1066 on: March 03, 2018, 09:14:10 AM »
Valueless assets (cryptocurrencies, paintings, beanie babies, rare coins, etc.) have no rational basis for their price.

Crypto has value. Dapps and other services require crypto; the form of digital social contract people are engaging in require crypto. People are using it as medium-of-exchanges.

Pokemon cards have value.  Engaging in a card based game of Pokemon requires them.  People even trade Pokemon cards, using them as a medium of exchange.

The problem with your argument is that each instance of 'value' brought forth is vanishingly small, and only of value to the tiny niche group of people who have bought into the hype.  This is also true of comic books, beanie babies, tulips, rare coins, etc.
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shadow

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1067 on: March 03, 2018, 09:48:47 AM »
Valueless assets (cryptocurrencies, paintings, beanie babies, rare coins, etc.) have no rational basis for their price.

Crypto has value. Dapps and other services require crypto; the form of digital social contract people are engaging in require crypto. People are using it as medium-of-exchanges.

Pokemon cards have value.  Engaging in a card based game of Pokemon requires them.  People even trade Pokemon cards, using them as a medium of exchange.

The problem with your argument is that each instance of 'value' brought forth is vanishingly small, and only of value to the tiny niche group of people who have bought into the hype.  This is also true of comic books, beanie babies, tulips, rare coins, etc.

The difference from these collectibles is that some crypto generate fees for its hodlers. 'Delegates' in some crypto systems, which I'm not a fan of, earn transaction fees through validating the network. They are require to set up a crypto node or participate in a pool. Proof-of-stake systems will allow any hodler with a minimum, such as 1 unit, to validate the network, earning transaction fees. 

'Vanishingly small' and 'tiny niche group', where are you getting these numbers from? Coinbase alone has over 13 million users, verified with photo id and linked bank accounts. In one year, the number of transactions for one of the top crypto went from 50,000 to 750,000 daily with a high over 1.2 mil. Crypto usage has also seen rise for social network tips and charitable donations.   

waltworks

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1068 on: March 03, 2018, 12:27:40 PM »
Oh, come now. How many of those 13 million people are buying *anything* IRL with that crypto? How many are just trading crypto around with each other (or just buying/holding for "investment" purposes)?

I think "niche" is a fair term here. It's well established that you can buy virtually nothing with crypto, and if you do, it'll probably cost you a fortune/take forever/get you defrauded.

-W

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1069 on: March 03, 2018, 12:39:26 PM »
It may or may not be a niche. It's less debatable than 'vanishingly small' and 'tiny niche group', where we see an increase in number of users and transactions.

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It's well established that you can buy virtually nothing with crypto

This is an empty statement. That crypto is being using as speculation does not mean that crypto is solely used for that. People are using crypto for various purposes, including entertainment and other purchases and services.

BattlaP

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1070 on: March 03, 2018, 01:18:59 PM »
Valueless assets (cryptocurrencies, paintings, beanie babies, rare coins, etc.) have no rational basis for their price.

Crypto has value. Dapps and other services require crypto; the form of digital social contract people are engaging in require crypto. People are using it as medium-of-exchanges.

Pokemon cards have value.  Engaging in a card based game of Pokemon requires them.  People even trade Pokemon cards, using them as a medium of exchange.

The problem with your argument is that each instance of 'value' brought forth is vanishingly small, and only of value to the tiny niche group of people who have bought into the hype.  This is also true of comic books, beanie babies, tulips, rare coins, etc.

The difference from these collectibles is that some crypto generate fees for its hodlers. 'Delegates' in some crypto systems, which I'm not a fan of, earn transaction fees through validating the network. They are require to set up a crypto node or participate in a pool. Proof-of-stake systems will allow any hodler with a minimum, such as 1 unit, to validate the network, earning transaction fees. 

'Vanishingly small' and 'tiny niche group', where are you getting these numbers from? Coinbase alone has over 13 million users, verified with photo id and linked bank accounts. In one year, the number of transactions for one of the top crypto went from 50,000 to 750,000 daily with a high over 1.2 mil. Crypto usage has also seen rise for social network tips and charitable donations.   

Proof of stake just gives you more of the same thing, it's literally a circular argument in terms of value.

Let's be real here, the only value is to those who are needing illegal cross border transactions, those requiring anonymity or people of a very particular anti-centralised anything political persuasion. Everyone else is speculating that one day they will have a wider value to common people.

shadow

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1071 on: March 03, 2018, 01:41:33 PM »
Proof of stake just gives you more of the same thing, it's literally a circular argument in terms of value.

People can earn fees that they can convert to fiat. Their crypto allows them to generate these fees, base on network transactions.

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Let's be real here, the only value is to those who are needing illegal cross border transactions, those requiring anonymity or people of a very particular anti-centralised anything political persuasion. Everyone else is speculating that one day they will have a wider value to common people.

Cryptokitties, cryptocountries, etheroll, etc, these have no value or interest to me. However, some people are using it for entertainment or other services; it has value to these people. Youtube and twitch content producers or streamers are being patronaged with crypto. And even if people use it for speculation or to crowdfund a speculative project, or people using it to buy vpns, these are still uses of crypto. Base on the trend, there will be more uses and different types of use-cases.

There is value in crypto, and there is significant, legitimate value in it beyond ideological or criminal use.

sol

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1072 on: March 03, 2018, 04:37:45 PM »
That crypto is being using as speculation does not mean that crypto is solely used for that. People are using crypto for various purposes, including entertainment and other purchases and services.

Thus far, you can't pay for rent, or groceries, or energy with cryptocurrencies.  Trading it back and forth between users for "entertainment" does not make it a currency.  I used to trade baseball cards back and forth with other baseball card enthusiasts, but we never mistook them for currency because we couldn't use them in the broader economy and they weren't backed by anyone. 

Even if you find a merchant who will accept payment in baseball cards, that STILL doesn't make them currency. 

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1073 on: March 03, 2018, 07:51:43 PM »
Just because landlords, supermarkets or energy utilities don't accept cryptocurrency doesn't mean it's not a currency. If someone accepts crypto in exchange for goods and services, anticipating that they can then use that crypto to purchase goods and services, then it's a currency.

It's like tobacco or ramen in prison.  It's used as a store of value in a closed economic system.

https://www.theguardian.com/us-news/2016/aug/22/ramen-prison-currency-study

I don't think it serves the arguments of crypto skeptics to deny the utility of crypto currency, wherever one may find it. 

However, based on my understanding, that utility seems extremely limited.

As a currency they suffer some pretty significant draw backs.  They are nowhere near as universal as the USD, the Euro, Yen, AUD etc etc, and they are incredibly niche in their acceptance. Their volatility and high transaction fees make them very unattractive as a source of value exchange.

https://www.theverge.com/2017/12/6/16743220/valve-steam-bitcoin-game-store-payment-method-crypto-volatility

That may change in the future. But it may not.

One of the ironies I struggle to look beyond is that although the rationale behind the rapid price appreciation of crypto currencies is they represent the disruptive currencies of the future, yet at the moment, the rampant speculation resulting in extreme volatility of these crypto currencies actually renders them incredibly unattractive for actual use as a currency.

GuitarStv

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1074 on: March 04, 2018, 06:59:44 AM »
Just because landlords, supermarkets or energy utilities don't accept cryptocurrency doesn't mean it's not a currency. If someone accepts crypto in exchange for goods and services, anticipating that they can then use that crypto to purchase goods and services, then it's a currency.

It's like tobacco or ramen in prison.  It's used as a store of value in a closed economic system.

https://www.theguardian.com/us-news/2016/aug/22/ramen-prison-currency-study

I don't think it serves the arguments of crypto skeptics to deny the utility of crypto currency, wherever one may find it. 

However, based on my understanding, that utility seems extremely limited.

As a currency they suffer some pretty significant draw backs.  They are nowhere near as universal as the USD, the Euro, Yen, AUD etc etc, and they are incredibly niche in their acceptance. Their volatility and high transaction fees make them very unattractive as a source of value exchange.

https://www.theverge.com/2017/12/6/16743220/valve-steam-bitcoin-game-store-payment-method-crypto-volatility

That may change in the future. But it may not.

One of the ironies I struggle to look beyond is that although the rationale behind the rapid price appreciation of crypto currencies is they represent the disruptive currencies of the future, yet at the moment, the rampant speculation resulting in extreme volatility of these crypto currencies actually renders them incredibly unattractive for actual use as a currency.

Literally any good is a currency by this definition, because any good can be used as a store of value given the right circumstances.  Seems kinda goofy.  I think that you have to look as the other available stores of value in a system and compare them. Calling Pokemon cards or crypto a currency makes little sense when compared to the ubiquity and utility use of say, US dollars.
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misterhorsey

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1075 on: March 04, 2018, 02:04:39 PM »
It's kind of my point to point out the goofiness.

Ultimately, any good has the potential to be a currency.  But that doesn't mean it makes a good currency.

https://www.npr.org/sections/money/2011/02/15/131934618/the-island-of-stone-money

But there's a distinction between currencies, which are things traded for their function as a store of value, and collectables, things that are traded for their inherent and perceived value. Critics of crypto currency seem to sometimes miss this distinction when they lump crypto together with other subjects of speculative bubbles.

People might trade Pokemon cards, but that doesn't make it a currency. They don't use Pokemon as a  store of value that they exchange for goods or services, as far as I know.

There's no doubt that crypto currency is also the subject of a speculative bubble.

But my point is simply that denying the (extremely limited, niche and conditional) utility of crypto currency is to invite a counter argument establishing the utility from crypto currency users.  However accepting that it currently does have use as a currency, allows for a more qualitative assessment about the nature of that utility.

I guess I sense that among certain fans of crypto currency there's the belief that because crypto currency is accepted for payment in certain places, it's the portent of things to come.  But there's no magic or wizardry involved - all it takes is for a a consensus to use it. And that consensus doesn't have to be very big.  The internet allows a small group of people (relative to the larger economy) to use crypto currency, but be geographically spread out. For some, this may make the consensus seem larger than it really is.

And my reason for wanting to point all this out is that I think the better argument against crypto currency is simply to accept that yes, it can be used as a currency, but there are so many better options that do a better job as a currency (i.e. that are stable in value, universally accepted) why would you use it?

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1076 on: March 04, 2018, 05:21:30 PM »
there are so many better options that do a better job as a currency (i.e. that are stable in value, universally accepted) why would you use it?

1.  To move illegal drug money you can't transfer with a bank.

2.  To finance terrorist organizations without the FBI finding out.

3.  To support a rogue state, like North Korea, that is suffering under economic sanctions by the international community that prohibit direct contributions.

4.  As an unregulated penny stock you can pump and dump to get rich by misleading uninformed retail investors.

5.  For entertainment value, because you think the first four primary uses aren't at all concerning.


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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1077 on: March 04, 2018, 07:30:42 PM »
Ha yes, good points.

Actually one that you didn't mention is if you are a Chinese Prince-ling, or Russian Oligarch, or even a well to do person in a state that doesn't enforce the rule of law, and you wish subvert capital controls and move money out of your home country as otherwise it will always be subject to seizure by the state if you keep it there.

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1078 on: March 04, 2018, 08:48:28 PM »
there are so many better options that do a better job as a currency (i.e. that are stable in value, universally accepted) why would you use it?

1.  To move illegal drug money you can't transfer with a bank.

2.  To finance terrorist organizations without the FBI finding out.

3.  To support a rogue state, like North Korea, that is suffering under economic sanctions by the international community that prohibit direct contributions.

4.  As an unregulated penny stock you can pump and dump to get rich by misleading uninformed retail investors.

5.  For entertainment value, because you think the first four primary uses aren't at all concerning.

And notice that none of these uses imparts an intrinsic relative value. As a agency of transfer it doesn't matter if a BTC costs $100000 or $1 as long as it's stable-ish while the transfer occurs.
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trollwithamustache

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1079 on: March 05, 2018, 08:41:18 AM »
I'm always curious how much Pot is smoked by the people who hammer bitcoin first and foremost for being used for illegal drug purchases.

sol

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1080 on: March 05, 2018, 09:56:27 AM »
I'm always curious how much Pot is smoked by the people who hammer bitcoin first and foremost for being used for illegal drug purchases.

If that was directed at me, then the answer is "none".  My job precludes most types of drug use.

Not that it really matters.  The problem with drug money isn't privately owned US dispensaries that grow in a co-op, the problem is international cartels that murder people and put their dismembered heads on the backs of desert tortoises. 

I don't avoid flying because terrorists have used airplanes, because there are legitimate uses for airplanes.  Cryptocurrencies don't seem to have any legitimate uses in their design brief.  They were created for the sole purpose of breaking the law.
« Last Edit: March 05, 2018, 10:46:58 AM by sol »

shadow

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1081 on: March 05, 2018, 10:41:36 AM »
Some brief thoughts.

In parts of Europe, they decriminalized the use of illegal drugs and set up clinics where they offer addicts a fix. It's working, and I hope to see the U.S. adopt a similiar attitude and laws regarding drugs. I remember watching a documentary on addicts, and one of the drug users was begging for money for drugs and as bypassers kept ignoring him, he started talking about robbing them. It was eerie watching that, as his desperation began to cloud his moral judgement. There will be initial costs to establishing something similiar to the European program, but I think in the long run, it can decrease costs in terms of crime, security, and medical care, and helping addicts to return to productive society. As to whether the U.S. will be able to facilitate something like this, there are philosophies of belief and financially-entrenched industries against it.

Some of the people that are crypto enthusiasts begin with the most skeptical of approaches before deciding to put in any amount of money. They have to consider the concerns and pitfalls, current and future regulation. They're not ignoring these things. They watch various congressional and other hearings. Things like cybercrime and North Korean money-laundering, all these are discussed. For criminal uses, they have task forces set up. Task forces and other reports all conclude that the use of crypto for criminal transactions are tiny compared to normal, legitimate uses. They actively monitor blockchain activities. In the end, blockchain is not going to go away, given its properties that allow for trusted digital social contracts.



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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1082 on: March 05, 2018, 12:08:37 PM »
there are so many better options that do a better job as a currency (i.e. that are stable in value, universally accepted) why would you use it?

1.  To move illegal drug money you can't transfer with a bank.

2.  To finance terrorist organizations without the FBI finding out.

3.  To support a rogue state, like North Korea, that is suffering under economic sanctions by the international community that prohibit direct contributions.

4.  As an unregulated penny stock you can pump and dump to get rich by misleading uninformed retail investors.

5.  For entertainment value, because you think the first four primary uses aren't at all concerning.

My modified #1 appears the be the closest thing to a legitimate use case for cryptocurrency; however, the only way a government will allow it to be considered a legitimate form of money is if it can be monitored and audited for reasons of #1-4 and for tax purposes.  I've seen far too many proponents talk about "getting one over on The Man" and avoiding the paper trails common with currency. That's not a benefit folks, that's a significant bar to being considered legal. 
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James_001

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1084 on: March 14, 2018, 08:12:05 AM »
Has anyone invested in this? https://crypto20.com/en/

Its an index fund for the top 20 crypto coins. I would be curious to hear your thoughts...

runbikerun

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1085 on: March 14, 2018, 10:44:35 AM »
We interrupt these arguments to bring you some news:

Brazilian State Bank to Tokenize Brazilian Real on Ethereum’s Public Blockchain

Coinbase is launching a weighted index fund for cryptocurrencies.

In other news, Google is banning all cryptocurrency advertising from June onwards.

aspiringnomad

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1086 on: March 14, 2018, 09:10:46 PM »
We interrupt these arguments to bring you some news:

Brazilian State Bank to Tokenize Brazilian Real on Ethereum’s Public Blockchain

Coinbase is launching a weighted index fund for cryptocurrencies.

In other news, Google is banning all cryptocurrency advertising from June onwards.

Guess I'll stop seeing ads for that dorky turtle neck wearing "Crypto Genius" on these forums.


jmecklenborg

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1088 on: March 19, 2018, 01:22:17 PM »
Guess I'll stop seeing ads for that dorky turtle neck wearing "Crypto Genius" on these forums.

Way up there on my list of people who I'd really like to punch.  Up there with him is that guy with the glasses in LA showing off his [rented] Beverly Hills house and [rented] Lambo. 

That second guy was a little late to the crypto circus, as illustrated by a video that appeared in late 2017 where you could tell he was trying to posit himself as the "crypto genius" while not quite knowing what he was talking about. 

Travis

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1089 on: March 19, 2018, 01:28:56 PM »
Guess I'll stop seeing ads for that dorky turtle neck wearing "Crypto Genius" on these forums.

Way up there on my list of people who I'd really like to punch.  Up there with him is that guy with the glasses in LA showing off his [rented] Beverly Hills house and [rented] Lambo. 

That second guy was a little late to the crypto circus, as illustrated by a video that appeared in late 2017 where you could tell he was trying to posit himself as the "crypto genius" while not quite knowing what he was talking about.

To whom are you referring? The only guy I know matching that description is in hiding and being sued for shilling Bitconnect.
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appleshampooid

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1091 on: March 27, 2018, 07:04:22 AM »
I decided to get in to the game a couple of weeks ago. Less about speculation and trying to get rich and more about my belief that cryptocurrency will play some role in the future of commerce (my libertarian streak showing through). I wanted to wait a bit from the $20k high and see if prices would drop much more.

I didn't invest a life-changing amount (only a crazy person would IMO); in fact the amount is so small that even a 100x increase wouldn't change my life that much (although obviously it would make me happy). I signed up on Coinbase/GDAX and Gemini at the same time; Gemini is still "verifying" my identity and GDAX was done immediately, so GDAX it is (plus I wanted some LTC which Gemini doesn't support). Waited my 4 business days for the ACH to clear (ridiculous) and then set up some limit orders for BTC, ETH, LTC, and BCH.

Yesterday my limits fired for ETH and LTC, but not BTC or BCH. Later in the evening I decided to pull the trigger with a market order on those two. I was waiting for $7500/BTC and got tired of waiting when the price went above $8000 again.

With my $500 I went $200 into BTC, $200 into ETH, $50 into LTC and $50 into BCH.

Down about $18 bucks this morning, lol. I will be HODLing these until they go bust or appreciate significantly, and am hoping to actually use them to transact at some point. Not sure where I would do that, as nowhere that I usually spend money accepts crytpo, and I'm not about to go spending money willy nilly just to participate (this being the MMM forum and all).

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1092 on: March 27, 2018, 07:27:10 AM »
I haven't bought crypto, but have found it interesting to watch.

The trends I have watched makes this the least likely time so far that I would purchase.  Of course, humans are great at finding patterns where there are none, so this whole thing will probably reverse trend just to spite me.

Attached is an image from today with a trend line I noticed since the peak.  So far, Bitcoin seems to be tracking a pretty consistent downward trend since peaking out last winter.

I also tend to feel like you can really see people manipulating the market in real time.  The rapid rises and falls of exactly 3-5% have always come across to me as pumping and dumping manipulations of the market.

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1093 on: March 27, 2018, 09:56:26 AM »

I also tend to feel like you can really see people manipulating the market in real time.  The rapid rises and falls of exactly 3-5% have always come across to me as pumping and dumping manipulations of the market.

There are YouTube channels and a redit or two where pump and dump groups were exposed in the last couple months.
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appleshampooid

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1094 on: March 29, 2018, 04:40:06 AM »
I haven't bought crypto, but have found it interesting to watch.

The trends I have watched makes this the least likely time so far that I would purchase.  Of course, humans are great at finding patterns where there are none, so this whole thing will probably reverse trend just to spite me.

Attached is an image from today with a trend line I noticed since the peak.  So far, Bitcoin seems to be tracking a pretty consistent downward trend since peaking out last winter.

I also tend to feel like you can really see people manipulating the market in real time.  The rapid rises and falls of exactly 3-5% have always come across to me as pumping and dumping manipulations of the market.
What's that they say about trying to catch a falling knife? If I had just sat on my $7500 limit order it would have fired off this morning. So you are probably right. :cries:

It's okay, only $500. That's all I could convince the wife to go with. If prices really tank I might try to get back in with another $500 later on. Could be buying right to zero, but I personally believe they will go back up, a lot. Of course that is just my opinion, man.

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1095 on: March 29, 2018, 06:50:44 AM »
I haven't bought crypto, but have found it interesting to watch.

The trends I have watched makes this the least likely time so far that I would purchase.  Of course, humans are great at finding patterns where there are none, so this whole thing will probably reverse trend just to spite me.

Attached is an image from today with a trend line I noticed since the peak.  So far, Bitcoin seems to be tracking a pretty consistent downward trend since peaking out last winter.

I also tend to feel like you can really see people manipulating the market in real time.  The rapid rises and falls of exactly 3-5% have always come across to me as pumping and dumping manipulations of the market.
What's that they say about trying to catch a falling knife? If I had just sat on my $7500 limit order it would have fired off this morning. So you are probably right. :cries:

It's okay, only $500. That's all I could convince the wife to go with. If prices really tank I might try to get back in with another $500 later on. Could be buying right to zero, but I personally believe they will go back up, a lot. Of course that is just my opinion, man.

At least with only $500 invested you can always just call it entertainment money if things go south, like lottery tickets.  Just make sure you know why you are buying more if you keep chasing it later.

I got burned throwing good money after bad chasing an oil stock a few years ago.  In the end I was technically in the black, but the opportunity cost when compared to just putting it into an index fund wasn't exciting.  It was a good learning experience for me though.

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1096 on: April 18, 2018, 03:03:44 PM »
Now that the prices have come down, it seems there's less people shitting all over this thread. However, there is still a ton of development going on.

Brave Browser, one of the more promising projects on the Ethereum network just had a big announcement today:

Ad-blocking Brave browser signs deal with Dow Jones Media Group

BattlaP

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1097 on: April 18, 2018, 04:50:40 PM »
Now that the prices have come down, it seems there's less people shilling all over this thread. However, there is still a ton of hilarious scams going on.

https://cryptovest.com/news/another-scam-ico-savedroid-founder-exits-with-50m-to-chill-on-a-beach/

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1098 on: April 19, 2018, 12:47:31 PM »
I bought in at the start of this year. It's hard to make money when you have a 40% wind at your head.

Etherium has traded under $380, but back up into the 500's now. Still ample chances to make money speculating.

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Re: OFFICIAL: Blockchain / Crypto-Currency Portfolios and Discussion
« Reply #1099 on: April 19, 2018, 06:24:10 PM »
i haven't stepped in her in a bit and was wondering what was up with this thread. I took a look at the last couple pages, it seems some of the same ideas are being re-washed. I still don't know anyone personally that has used it. After bitcoin took a dump, all the chatter at work has dwindled to nothing.