What do you think of adding a low% of crypto allocation

[MustacheAndaHalf]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

But notice the first Venture Capital (VC) firm in the list: Sequoia Capital is legendary, but I'll quote just one VC investment: "In 1978, Sequoia became one of the first investors in Apple."  That said, most VC investments fail - so that could be the case with STEPN.  It's still noteworthy they invested.
https://en.wikipedia.org/wiki/Sequoia_Capital

[FLBiker]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

Apologies if this is a dumb question, but why would this work?  I mean, what difference does crypto make on this?  If someone came to me and said "I'm building an app that will pay people a dollar per 10000 steps" my response would be "that sounds like a nice way to incentivize good behavior but how will you make any money?".  Switching dollar to a new crypto coin doesn't make a difference (in my limited understanding) as far as the feasibility of this.  What am I missing?

[MustacheAndaHalf]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

Apologies if this is a dumb question, but why would this work?  I mean, what difference does crypto make on this?  If someone came to me and said "I'm building an app that will pay people a dollar per 10000 steps" my response would be "that sounds like a nice way to incentivize good behavior but how will you make any money?".  Switching dollar to a new crypto coin doesn't make a difference (in my limited understanding) as far as the feasibility of this.  What am I missing?

If anything, my liking STEPN was more off topic than your question, which brings this back to earnings and relevance to investors.  Here's the short explanation on their "lite paper" (as opposed to deeper dive in their "whitepaper"):
"We take small taxes from in-app activities, such as NFT trading, Shoe-minting and Shoe-rental."
https://stepn.com/litePaper

It's worth noting that media hype is worth something - it's advertising.  When athletes wear Nike brand clothes, that sells more clothes.  Similarly, it's possible for STEPN to create a marketplace and generate credits without crypto, but they do receive an advertising benefit from using crypto in this novel manner.

That same page goes on to explain their goal, which I suspect captured the imagination of VC investors.  As an aside, I suspect nobody cares about what VC means until they do some VC investment themselves?
"We aim to be the leading Web3 Health + Fitness app"

[GuitarStv]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

Apologies if this is a dumb question, but why would this work?  I mean, what difference does crypto make on this?  If someone came to me and said "I'm building an app that will pay people a dollar per 10000 steps" my response would be "that sounds like a nice way to incentivize good behavior but how will you make any money?".  Switching dollar to a new crypto coin doesn't make a difference (in my limited understanding) as far as the feasibility of this.  What am I missing?

You're looking at it wrong.  Obviously there's no money to be made in paying people to walk.  The goal of NFTs is not to implement something that works and make money by profiting after implementation.  That's a boring traditional business model.  Most of these NFT projects work by generating investments for a while, then declaring bankruptcy and quitting.  Profit is created by failing and walking off with the investment capital.

[Scandium]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

Apologies if this is a dumb question, but why would this work?  I mean, what difference does crypto make on this?  If someone came to me and said "I'm building an app that will pay people a dollar per 10000 steps" my response would be "that sounds like a nice way to incentivize good behavior but how will you make any money?".  Switching dollar to a new crypto coin doesn't make a difference (in my limited understanding) as far as the feasibility of this.  What am I missing?

Because they can create their own currency out of thin air, therefore they're not "paying" anyone anything in real money. They can use capital to "exchange" some for USD (perhaps with themselves), pay influencers/friends/bots to pump the value of their crypto, sell of tons of it, make a few million in untraceable/unaccountable transactions. Then bail.
Rinse, repeat.

The fact that you have thought about it for 5 sec means it's not for you. As 'line goes up' explains this works on people who are stupid, low social literacy, or both.

[LateStarter]

. . . 
Bitcoin is on the order of 2.5 Million times less efficient than Visa. 2.5 Million.
. . .

I assume this mighty number comes from the openly anti-Bitcoin Digiconomist article.

For an alternative openly pro-Bitcoin interpretation, see What Bloomberg Gets Wrong About Bitcoin's Climate Footprint.

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

[MustacheAndaHalf]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

Apologies if this is a dumb question, but why would this work?  I mean, what difference does crypto make on this?  If someone came to me and said "I'm building an app that will pay people a dollar per 10000 steps" my response would be "that sounds like a nice way to incentivize good behavior but how will you make any money?".  Switching dollar to a new crypto coin doesn't make a difference (in my limited understanding) as far as the feasibility of this.  What am I missing?

Because they can create their own currency out of thin air, therefore they're not "paying" anyone anything in real money. They can use capital to "exchange" some for USD (perhaps with themselves), pay influencers/friends/bots to pump the value of their crypto, sell of tons of it, make a few million in untraceable/unaccountable transactions. Then bail.
Rinse, repeat.

The fact that you have thought about it for 5 sec means it's not for you. As 'line goes up' explains this works on people who are stupid, low social literacy, or both.

Earlier I mentioned $2.5 billion in hacked crypto compared to $1.25 trillion in crypto market cap, hinting at just 0.2% being hacked.  Do you think your view balances the 0.2% an 99.8% views, or just focuses on the 0.2% view?

The team participated in a hackathon competition, where they weren't anonymous.  They created a company and attracted VC heavy weight Sequioa Capital, who has over $100 billion in assets and can afford the best lawyers.  How exactly would they defraud their VC investors and get away with it?

[Scandium]

"Users earn cryptocurrency tokens by walking or running outdoors, which they can use in the game to trade assets or exchange for other currencies to cash out."

"On 20 January, STEPN announced that it raised $5m in seed round financing from technology investors, including Sequoia Capital, Folius Ventures, Solana Capital and Alameda Research."
https://capital.com/stepn-gmt-price-prediction

I really like the concept of crypto currency you earn by walking and running.  It's a way to encourage healthy behavior by adding a game like score to it.

Apologies if this is a dumb question, but why would this work?  I mean, what difference does crypto make on this?  If someone came to me and said "I'm building an app that will pay people a dollar per 10000 steps" my response would be "that sounds like a nice way to incentivize good behavior but how will you make any money?".  Switching dollar to a new crypto coin doesn't make a difference (in my limited understanding) as far as the feasibility of this.  What am I missing?

Because they can create their own currency out of thin air, therefore they're not "paying" anyone anything in real money. They can use capital to "exchange" some for USD (perhaps with themselves), pay influencers/friends/bots to pump the value of their crypto, sell of tons of it, make a few million in untraceable/unaccountable transactions. Then bail.
Rinse, repeat.

The fact that you have thought about it for 5 sec means it's not for you. As 'line goes up' explains this works on people who are stupid, low social literacy, or both.

Earlier I mentioned $2.5 billion in hacked crypto compared to $1.25 trillion in crypto market cap, hinting at just 0.2% being hacked.  Do you think your view balances the 0.2% an 99.8% views, or just focuses on the 0.2% view?

The team participated in a hackathon competition, where they weren't anonymous.  They created a company and attracted VC heavy weight Sequioa Capital, who has over $100 billion in assets and can afford the best lawyers.  How exactly would they defraud their VC investors and get away with it?

uuuh what? I have no idea what the first part means. I'm not balancing or focusing or hacking anything...

There's no oversight or consumer protection in crypto, so it's not strictly 'fraud'. Which of course is why they choose to use it for this scheme!
And they will of course not "defraud" the VCs. Just their marks. Sorry; "customers", or "users"? The VCs will get their money and profit first.

OK, a charitable interpretation is that it's just marketing. Saying crypto these days get attention and money thrown at you. This app of course has no need for crypto, NFT and all that nonsense, but they do it to get funded. It will probably suck, like all other token-bullshit, and shut down pretty quickly. (with a completely borked internal economy with skewed incentives overrun by scammers and middle-men). So yes I'll allow for the possibility the founders are just marketing-savvy and idealistic with a naďve and idiotic idea.

[MustacheAndaHalf]

Scandium - Your view of STEPN seems to be based on very deep distrust of crypto.  You can probably cite news stories of scams or frauds - but when I compared all money from crypto hacks to all money in crypto, there was about 500x more money in BTC and ETH than in all the hacks of crypto, combined... ever.  So my starting point would be not the number of news stories about crypto, but the overall money going to fraud versus money currently in crypto.  I think, like hacks, it's a very tiny percentage by comparison.

(link from ChpBstd's earlier post, showing $2.4 billion in total hacks of crypto)
https://cryptosec.info/exchange-hacks/

---
My past few posts have links backing up what I'm saying.  I see LateStarter posting a couple links - even more links per sentence than me.  But when you look at posts calling any new crypto coin a fraud or scam... no links.  To me, that suggests some people are sharing their emotional views of crypto, while others are sharing information found outside the forum.

[boarder42]

9.5 years................

Link
https://www.cnbc.com/2022/04/07/thiel-calls-buffett-sociopathic-grandpa-from-omaha-about-bitcoin.html

[boarder42]

Good people

https://www.opensecrets.org/news/2022/02/peter-thiel-tied-dark-money-group-helping-bankroll-super-pac-spending-on-2022-election/

[boarder42]

#ibuycryptotohelpdestroydemocracy

[boarder42]

L
https://www.google.com/amp/s/www.cnbc.com/amp/2019/02/25/warren-buffett-and-bill-gates-the-rich-should-pay-higher-taxes.html

[boarder42]

https://www.bloomberg.com/news/articles/2021-10-26/dalio-fink-say-they-d-pay-more-tax-if-funds-were-spent-well

[boarder42]

Mooooooooorrrrreeeee linksssss pleeeasssse

[boarder42]

https://youtu.be/UN_Gkvat5lM

[boarder42]

Where you are.

https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

Easy.

What you're suggesting

https://www.visitlasvegas.com/

Where you'll end up.

https://www.businessinsider.com/dutch-farmers-protecting-tulip-fields-from-instagram-users-2019-4

[ChpBstrd]

(link from ChpBstd's earlier post, showing $2.4 billion in total hacks of crypto)
https://cryptosec.info/exchange-hacks/

Key caveats:
1) That’s only the sum (per that particular site) of exchange hacks where the amount was publicized.
2) The value of a heist was at the time it occurred. E.g. $600M was a larger percentage of bitcoins back in 2014 than if the same amount was lost today.

[MustacheAndaHalf]

Mooooooooorrrrreeeee linksssss pleeeasssse

The forum rules state "no spam", so I've reported you for spamming.

5. No spam.

https://forum.mrmoneymustache.com/forum-information-faqs/forum-rules/

[boarder42]

Good luck with that report.

I'll tag some mods bc of how ridiculous the report is

@FrugalToque
@arebelspy

Almost as ridiculous as the thread. If that's the direction of the forum I'll be glad to be banned again.

MOD NOTE: Yes, eight posts in a row (starting here) is spam. You could easily combine that all into one coherent post. Chill out.

[boarder42]

I thought this was a satire thread like top is in.

My apologies.

[boarder42]

Sorry forgot to provide a link to my beliefs.
https://birdsarentreal.com/

[Scandium]

Scandium - Your view of STEPN seems to be based on very deep distrust of crypto.  You can probably cite news stories of scams or frauds - but when I compared all money from crypto hacks to all money in crypto, there was about 500x more money in BTC and ETH than in all the hacks of crypto, combined... ever.  So my starting point would be not the number of news stories about crypto, but the overall money going to fraud versus money currently in crypto.  I think, like hacks, it's a very tiny percentage by comparison.

(link from ChpBstd's earlier post, showing $2.4 billion in total hacks of crypto)
https://cryptosec.info/exchange-hacks/

---
My past few posts have links backing up what I'm saying.  I see LateStarter posting a couple links - even more links per sentence than me.  But when you look at posts calling any new crypto coin a fraud or scam... no links.  To me, that suggests some people are sharing their emotional views of crypto, while others are sharing information found outside the forum.

I'm confused, I said nothing about hacks? And there is no hack involved here?

My view is simply based on the fact of crypto being pointless, especially for a fucking exercise app! So yes, it's either marketing, or a ponzi scheme. There is no other reason to "NFT your step goal bro!". Occams razor, qed.

[Scandium]

Making massive investment returns is 'pointless'?  Isn't this an investment forum?  LMAO you people really do take the cake.  Peace out!

For an exercise app? Yes. The concept of crypto is pointless.
Some people made gains with Madoff for a decade, that doesn't mean it wasn't dumb in the end. Get out at the right time, sure it can "work" for you

[FLBiker]

Making massive investment returns is 'pointless'?  Isn't this an investment forum?  LMAO you people really do take the cake.  Peace out!

For me, the value of this forum isn't that it's an investment forum.  There are tons of investment forums out there, with all sorts of strategies, some of which have undoubtedly made way more money than index funds over the last decade or two.  And there are lots of forums (and probably even more that no longer exist) promoting strategies that have lagged index funds.

The value of this forum to me, though, is the reproducibility of the results generally espoused here.  I am 45 years old.  After spending my 20's teaching English in Asia, I started working full-time at 30.  I never earned dramatically high salaries (started out at $40K, am now at $80K).  My wife has typically earned about half of what I have earned, and she took two years off when our daughter was born.  Today, we have over $1.3 million dollars in investments, and with annual expenses of ~$55K, we are effectively financially independent.  Our investment strategy has been extremely simple -- 90/10 stocks/bonds, with my stocks global market cap weighted.  We saved somewhere around 30-50% of our income each year, largely in tax advantaged accounts, while living a conventional middle class lifestyle.

This is certainly not the FASTEST way to reach financial independence, but I do believe it is the fastest way to RELIABLY reach financial independence.  It doesn't require luck, or skill, or specialized knowledge.  For me, that is the real power of the ideas in this community.

I don't care one way or the other about crypto (or gold, or options, or whatever).  If there is a reproducilble strategy of investing in them that will work reliably for decade after decade, I'd be all for it.  I have yet to encounter that strategy, though.

[Juan Ponce de León]

Making massive investment returns is 'pointless'?  Isn't this an investment forum?  LMAO you people really do take the cake.  Peace out!

For me, the value of this forum isn't that it's an investment forum.  There are tons of investment forums out there, with all sorts of strategies, some of which have undoubtedly made way more money than index funds over the last decade or two.  And there are lots of forums (and probably even more that no longer exist) promoting strategies that have lagged index funds.

The value of this forum to me, though, is the reproducibility of the results generally espoused here.  I am 45 years old.  After spending my 20's teaching English in Asia, I started working full-time at 30.  I never earned dramatically high salaries (started out at $40K, am now at $80K).  My wife has typically earned about half of what I have earned, and she took two years off when our daughter was born.  Today, we have over $1.3 million dollars in investments, and with annual expenses of ~$55K, we are effectively financially independent.  Our investment strategy has been extremely simple -- 90/10 stocks/bonds, with my stocks global market cap weighted.  We saved somewhere around 30-50% of our income each year, largely in tax advantaged accounts, while living a conventional middle class lifestyle.

This is certainly not the FASTEST way to reach financial independence, but I do believe it is the fastest way to RELIABLY reach financial independence.  It doesn't require luck, or skill, or specialized knowledge.  For me, that is the real power of the ideas in this community.

I don't care one way or the other about crypto (or gold, or options, or whatever).  If there is a reproducilble strategy of investing in them that will work reliably for decade after decade, I'd be all for it.  I have yet to encounter that strategy, though.

Good post.  I totally understand your mindset as that's where I started out with my investing as well.  I just didn't see it out for anywhere near as long or as successfully as you have.  What I don't understand in some of these other posters is the absolute hostility and anger they have about a $2T market cap basket of assets.  In my view, to say crypto is 'pointless' or a scam has about as much validity as saying Apple shares are the same.  There is nothing to be proud about in completely missing out on a 2T run up in market cap.  If it's not your cup of tea, no worries, but all these 'I hope it fails and all these con-artists get rekt I just hope it doesn't effect my ETFs too much' posts around here are just pathetic.

[ChpBstrd]

Making massive investment returns is 'pointless'?  Isn't this an investment forum?  LMAO you people really do take the cake.  Peace out!

For an exercise app? Yes. The concept of crypto is pointless.
Some people made gains with Madoff for a decade, that doesn't mean it wasn't dumb in the end. Get out at the right time, sure it can "work" for you

That's the story for every investment bubble. Had one sold pets.com at just the right time in 1999, one would have gotten rich. Enron doubled from 1999 to 2000. And as mentioned, Madoff ran his scam for decades at a time, but regardless of timeframe all these things end in the old turkey chart.
http://stephenkinsella.net/WordPress/wp-content/uploads/2008/08/turkey.jpg

 

[lifeanon269]

That's the story for every investment bubble. Had one sold pets.com at just the right time in 1999, one would have gotten rich. Enron doubled from 1999 to 2000. And as mentioned, Madoff ran his scam for decades at a time, but regardless of timeframe all these things end in the old turkey chart.
http://stephenkinsella.net/WordPress/wp-content/uploads/2008/08/turkey.jpg

There is a reason why fewer and fewer people with credibility make the claim that bitcoin is going to go to zero after making a parabolic bubble price moves. The reason being is that it has made many parabolic price moves in its lifetime and even after each of those bubbles have burst, it hasn't gone to zero. It is safe to say there has never been another asset that has made numerous parabolic moves through out its life and has gone to zero afterward. None of the examples given that have gone to zero afterward that are often used in comparison with bitcoin (Enron, dot com bust, etc) have had multiple parabolic moves in their lives like bitcoin has. Also, if something has had multiple parabolic moves and survives those bubble bursts, history has shown that it makes it more likely that they'll survive longer term (Apple, Amazon, Tesla, etc).

I think at the very least we can all agree that bitcoin's historical price moves are unlike anything anyone has ever seen from a price perspective. Period. To make claims that bitcoin will not be around following any exuberant parabolic move it makes is just ignoring the reality of the situation outside of the price chart they're so fixated on.

Meanwhile, the bitcoin company Strike just partnered with NCR and Blackhawk, two of the largest point of sale payment companies in the country to bring bitcoin lightning network payments to in-person point of sale merchants (McDonald's, Walmart, CVS, Walgreens, Whole Foods, Kroger, Home Depot, Lowe's, etc). People that really keep telling themselves that bitcoin is just going to go to $0 are delusionally ignoring an unrelenting growth that is happening at the industry and user level and taking place outside of the uncorrelated price movements that are just based on speculative trader moves. I hate to break it to you, but bitcoin isn't going to $0.

[MustacheAndaHalf]

Scandium - Your view of STEPN seems to be based on very deep distrust of crypto.  You can probably cite news stories of scams or frauds - but when I compared all money from crypto hacks to all money in crypto, there was about 500x more money in BTC and ETH than in all the hacks of crypto, combined... ever.  So my starting point would be not the number of news stories about crypto, but the overall money going to fraud versus money currently in crypto.  I think, like hacks, it's a very tiny percentage by comparison.

(link from ChpBstd's earlier post, showing $2.4 billion in total hacks of crypto)
https://cryptosec.info/exchange-hacks/

---
My past few posts have links backing up what I'm saying.  I see LateStarter posting a couple links - even more links per sentence than me.  But when you look at posts calling any new crypto coin a fraud or scam... no links.  To me, that suggests some people are sharing their emotional views of crypto, while others are sharing information found outside the forum.

I'm confused, I said nothing about hacks? And there is no hack involved here?

My view is simply based on the fact of crypto being pointless, especially for a fucking exercise app! So yes, it's either marketing, or a ponzi scheme. There is no other reason to "NFT your step goal bro!". Occams razor, qed.

You seem to stop reading my posts before I make the main point?

Scandium - Your view of STEPN ... So my starting point would be not the number of news stories about crypto, but the overall money going to fraud versus money currently in crypto.  I think, like hacks, it's a very tiny percentage by comparison.

[Scandium]

Good post.  I totally understand your mindset as that's where I started out with my investing as well.  I just didn't see it out for anywhere near as long or as successfully as you have.  What I don't understand in some of these other posters is the absolute hostility and anger they have about a $2T market cap basket of assets.  In my view, to say crypto is 'pointless' or a scam has about as much validity as saying Apple shares are the same.  There is nothing to be proud about in completely missing out on a 2T run up in market cap.  If it's not your cup of tea, no worries, but all these 'I hope it fails and all these con-artists get rekt I just hope it doesn't effect my ETFs too much' posts around here are just pathetic.

I haven't read every post, but I don't see much of this "hostility" or anger towards crypto? People say, and debate, that it's a ponizi scheme, scam, pointless waste etc. That doesn't mean one is angry.. You  seem to take any negativity towards crypto very personally, and reflectively; project that we are emotionally invested in "bringing it down". I for one am not. It's stupid, pointless, and i like to laugh out all the nonsense crypto-broh BS out there.

You also seem to miss the point by constantly bringing up "market cap". Nobody is saying people aren't currently paying lots of money for BTC ETH etc. Nobody is disputing that. By "pointless" I mean it solve no current large scale problem (except the "fleeing dictatorship" edge-case), has no utility as a product, and current iterations have no plausible way to do so in the future. It's value is wholly irrational and (usually manufactured) hype.
The apple stock comparison does not hold up. Some people pay $20k for a handbag made by slave-workers for a few bucks. I think that's pointless and (almost) without value as well, probably a more apt comparison.

[GuitarStv]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

[lifeanon269]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

Yes, market cap is a pretty meaningless metric for determining how much money is truly supported by a market. Liquidity/market depth is a much better indicator. If an asset has a market cap of $20 billion but only a few million in liquidity or market depth, then the price would crash hard if anyone attempted to get any real value out of the market. That means the value you think you had in that asset evaporates instantly. This is true of all markets. It is why it is pointless to measure a billionaire's usable net worth by the stock holdings they have in a company since they'd never actually be able to cash out all that value without also destroying the value of the company's stock. People thinking that a billionaire with $200B in stock holdings would be able to cash out even a fraction of that don't understand this. What they would need to do is find an OTC buyer that would be willing to by their shares at the market rate so as not to impact the market liquidity.

All these alt-coins that have "billions" in market cap only have a few million in actual liquidity. Anyone that has any substantial money saved up in these alt-coins probably should think twice about how much they actually have saved in them. The other dangerous game with many of these alt-coins is that many of them are pre-mined or corporate controlled which means that these large stake holders can fake a lot of liquidity in the market which makes the market seem like it is larger than it really is.

[MustacheAndaHalf]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

I think we'd agree that's fraud, with buying and selling within your family not really constituting a "market".  So it's not really "market cap" without a market.

Meanwhile, CME runs a Bitcoin futures market.  You can buy & sell on that market, get tax forms, etc.
https://www.cmegroup.com/media-room/press-releases/2017/10/31/cme_group_announceslaunchofbitcoinfutures.html

[GuitarStv]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

I think we'd agree that's fraud, with buying and selling within your family not really constituting a "market".  So it's not really "market cap" without a market.

Meanwhile, CME runs a Bitcoin futures market.  You can buy & sell on that market, get tax forms, etc.
https://www.cmegroup.com/media-room/press-releases/2017/10/31/cme_group_announceslaunchofbitcoinfutures.html

It's not fraud if the shares were publicly traded and mom has no insider information about my business other than me owning it.  100% above board.  Market cap is meaningless when it's so easy to fake a market.

[ChpBstrd]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

And if next month you hold a share auction in your front yard and mom is willing to pay a nickel for her second share, your company is now a FIVE BILLION DOLLAR company with 500% growth in just one month!!! That's "parabolic"!

Anyone who disagrees with the value and thinks your company is worthless is ignoring the FACT that the company is actually trading at that valuation in an open marketplace.

[MustacheAndaHalf]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

I think we'd agree that's fraud, with buying and selling within your family not really constituting a "market".  So it's not really "market cap" without a market.

Meanwhile, CME runs a Bitcoin futures market.  You can buy & sell on that market, get tax forms, etc.
https://www.cmegroup.com/media-room/press-releases/2017/10/31/cme_group_announceslaunchofbitcoinfutures.html

It's not fraud if the shares were publicly traded and mom has no insider information about my business other than me owning it.  100% above board.  Market cap is meaningless when it's so easy to fake a market.

While I don't know securities law in detail, this view seems laughable to me.  Nobody believes a market with you as the only seller and your mom as the only buyer is an arm's length transaction.  Take that view to a lawyer and make their day.

I know a bit more about IRAs since I studied them recently - and there it's not allowed.  If your IRA (more likely your self-directed IRA) makes a trade specifically with your mom, the IRS will strip it's status as an IRA and force distribution of the entire amount with taxes and penalties (according to IRS code 4975 if I remembered right).
https://www.law.cornell.edu/uscode/text/26/4975

[talltexan]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

And if next month you hold a share auction in your front yard and mom is willing to pay a nickel for her second share, your company is now a FIVE BILLION DOLLAR company with 500% growth in just one month!!! That's "parabolic"!

Anyone who disagrees with the value and thinks your company is worthless is ignoring the FACT that the company is actually trading at that valuation in an open marketplace.

Isn't the person who disagrees with that valuation able to sell it short?

[ChpBstrd]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

I think we'd agree that's fraud, with buying and selling within your family not really constituting a "market".  So it's not really "market cap" without a market.

Meanwhile, CME runs a Bitcoin futures market.  You can buy & sell on that market, get tax forms, etc.
https://www.cmegroup.com/media-room/press-releases/2017/10/31/cme_group_announceslaunchofbitcoinfutures.html

It's not fraud if the shares were publicly traded and mom has no insider information about my business other than me owning it.  100% above board.  Market cap is meaningless when it's so easy to fake a market.

While I don't know securities law in detail, this view seems laughable to me.  Nobody believes a market with you as the only seller and your mom as the only buyer is an arm's length transaction.  Take that view to a lawyer and make their day.

I know a bit more about IRAs since I studied them recently - and there it's not allowed.  If your IRA (more likely your self-directed IRA) makes a trade specifically with your mom, the IRS will strip it's status as an IRA and force distribution of the entire amount with taxes and penalties (according to IRS code 4975 if I remembered right).
https://www.law.cornell.edu/uscode/text/26/4975

Take out the mom part, and make it "a random stranger on the internet". Is the point any different?

[lifeanon269]

Isn't the person who disagrees with that valuation able to sell it short?

Not necessarily. In order to short the stock you'd have to borrow shares in order to sell them into the market to be able to capitalize on a price drop later. If the mom is the only one that actually owns any shares in this "market", you'd have no means of being able to perform a short sale. Unless you can get your hands on some borrowed stock to be able to short it, then no. But that's where I'd disagree here with the notion that this is an "open marketplace". Because in an open market you'd likely be able to find opportunities to perform an actual short sale.

[GuitarStv]

Isn't the person who disagrees with that valuation able to sell it short?

Not necessarily. In order to short the stock you'd have to borrow shares in order to sell them into the market to be able to capitalize on a price drop later. If the mom is the only one that actually owns any shares in this "market", you'd have no means of being able to perform a short sale. Unless you can get your hands on some borrowed stock to be able to short it, then no. But that's where I'd disagree here with the notion that this is an "open marketplace". Because in an open market you'd likely be able to find opportunities to perform an actual short sale.

Short selling has always confused me.  There were more than 141% of Gamestop stocks being shorted at one point.  It feels like that couldn't happen if everyone had to borrow a stock to short it.

[Telecaster]

Meanwhile, the bitcoin company Strike just partnered with NCR and Blackhawk, two of the largest point of sale payment companies in the country to bring bitcoin lightning network payments to in-person point of sale merchants (McDonald's, Walmart, CVS, Walgreens, Whole Foods, Kroger, Home Depot, Lowe's, etc). People that really keep telling themselves that bitcoin is just going to go to $0 are delusionally ignoring an unrelenting growth that is happening at the industry and user level and taking place outside of the uncorrelated price movements that are just based on speculative trader moves. I hate to break it to you, but bitcoin isn't going to $0.

I don't think it is going to zero either.  People own Bitcoin because they like the idea of owning Bitcoin.  As long as people like the idea owning Bitcoin, Bitcoin will have value.  Simple as that.   People who like Bitcoin really like Bitcoin so I think there is a floor there somewhere.   Similarly, if more people like Bitcoin in the future (or like it more) the price will go up.   Not much mystery here in my view.   

I remain skeptical however that there is a meaningful use case for Bitcoin.   For example, what you just wrote above.     If you have the Strike app you can now spend your Bitcoin at Home Depot.  Great!  Except Home Depot receives payment in US Dollars.  All Strike does is make the conversion for you. 

Remember the raison d'etre for Bitcoin is the ability to make trustless transactions.   When you involve Strike and NCR to make the transaction it is no longer trustless.    And if you use Bitcoin, you don't really know from one day to the next or even one hour to the next how much that new Weber pellet smoker is going to cost.   For example, if you were saving up Bitcoin to buy that smoker, the smoker got 20% more expensive over the last six months.  So if there is no price stability and there is no trustless transaction, what is the advantage of using Bitcoin?   

The use case arguments always come down to some version of Bitcoin is great if you live in Venezuela or Iran.  I'll buy that.  But I don't live there.   Most people don't live there.

[the_gastropod]

. . . 
Bitcoin is on the order of 2.5 Million times less efficient than Visa. 2.5 Million.
. . .

I assume this mighty number comes from the openly anti-Bitcoin Digiconomist article.

For an alternative openly pro-Bitcoin interpretation, see What Bloomberg Gets Wrong About Bitcoin's Climate Footprint.

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

No. This "both sides" thing is, itself, pretty gross Crypto propaganda. The author of this article is Nic Carter—a venture capitalist with colossal investments in crypto. In traditional journalism, having investments in companies bars you from writing about those companies. That is a conflict of interest. Nic Carter's rebuttal here is pure nonsense. I really encourage people to read it to see the childish mental gymnastics he does to try to sow doubt about actual good journalism.

Editing to actually add some reasons I think Nic Carter's article is nonsense
- Nic is mad at the per-transaction number. Fine. Look at the entire system's footprint. It uses more electricity than the entire country of Argentina. That the per-transaction number is astronomical simply highlights that this huge carbon footprint is for a pretty minimally-used side-hobby for some very niche libertarian computer-nerds. Let's think about this even more. By fairly generous estimations, there are ~80M people who own Bitcoin (only about 400k daily users, but anyway). There are 45 Million people living in Argentina. In other words, 45 Million people live their entire lives (including mining some bitcoin, flying to far away lands, etc.) on less energy than it takes to support a play-thing very casually used by ~70% more people. That is grotesque. Vulgar. Obscene.
- Nic claims that the comparison is unfair, because Bitcoin is a complete network, and Visa relies on banks and settlement systems—whose systems are (allegedly?) not included in the Visa energy calculations. This is hardly true in practice. Virtually every user of Bitcoin uses a Bitcoin exchange, expects to convert it back-and-forth with USD (or their own local currency), etc.
- Nic tries mightily to suggest that oil backs the USD (and somehow not Bitcoin?) There's no coherent explanation why—just lots of hand-wavy thought-terminating nonsense.
- He argues that Bitcoin transactions are of higher value transfers than Visa ones?!?! Computers do not care whether they're sending the binary sequence for $1 or $1B. It's the same cost. This is irrelevant.
- He argues that in the future things will be better because the block rewards will diminish! He then arbitrarily chooses transaction count and a weird $10 fee to make his point. He made those numbers up based on nothing other than making his argument make sense. (Plus, y'know, let's stick to the topic of *today*. CO2 released today is still relevant, Nic)
- He tries to suggest that much of Bitcoin mining uses renewable energy! This. Is. Not. How. Electrical. Grids. Work. Electricity is fungible. Electricity wasted on mining bitcoin is energy that could have been used for something useful elsewhere. Plus, it's just not true (as many of the sources below will show). Bitcoin mining tends to happen most where it's cheapest. Coal tends to be a very cheap source of energy throughout the world. Nic's argument is the financial equivalent of buying a TV with your income tax refund because, hey, it's just your income tax refund! FREE MONEY

In sum, this is a pretty weak argument. For what it's worth here are several more sources for Bitcoin's environmental impact, if you're interested:

https://ieeexplore.ieee.org/document/9385063
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3779720
https://www.sciencedirect.com/science/article/abs/pii/S2214629619305948?via%3Dihub
https://arxiv.org/pdf/2112.01238.pdf
https://ccaf.io/cbeci/index

Aside: I'm a software engineer. I have a Computer Science degree. I'm intimately familiar with code efficiency and how to at least estimate it (SUP BIG O NOTATION?). And I cannot emphasize this strongly enough: traditional financial systems are written in code attempting to be efficient. Bitcoin is purposefully wasteful. The mechanism by which it is secure against malicious miners, is to have them each deliberately waste computational time, guessing numbers, such that it would be too costly to cheat. Each miner is significantly less efficient than something like a Visa network. But remember: there are millions of bitcoin miners. It isn't very difficult to assess the magnitude in difference between Visa and Bitcoin—though people have done very deep investigative work, and found the ~2.5 Million x to be accurate.

[LateStarter]

. . . 
Bitcoin is on the order of 2.5 Million times less efficient than Visa. 2.5 Million.
. . .

I assume this mighty number comes from the openly anti-Bitcoin Digiconomist article.

For an alternative openly pro-Bitcoin interpretation, see What Bloomberg Gets Wrong About Bitcoin's Climate Footprint.

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

No. This "both sides" thing is, itself, pretty gross Crypto propaganda.

Oh please . . . . "my sources are all good and yours are all bad" ?   WTF ??

The author of this article is Nic Carter—a venture capitalist with colossal investments in crypto. In traditional journalism, having investments in companies bars you from writing about those companies. That is a conflict of interest. Nic Carter's rebuttal here is pure nonsense. I really encourage people to read it to see the childish mental gymnastics he does to try to sow doubt about actual good journalism.

Did you miss the bit where I said he's openly pro-Bitcoin and that there are agendas on both sides ?

Here are several more sources for Bitcoin's environmental impact, if you're interested:

https://ieeexplore.ieee.org/document/9385063
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3779720
https://www.sciencedirect.com/science/article/abs/pii/S2214629619305948?via%3Dihub
https://arxiv.org/pdf/2112.01238.pdf
https://ccaf.io/cbeci/index

I'm familiar with the general issue thanks - I was just querying this 2.5 million thing. However, none of these papers seem to make any mention of a Bitcoin / Visa comparison . . . or 2.5 million . . .

Aside: I'm a software engineer. I have a Computer Science degree. I'm intimately familiar with code efficiency and how to at least estimate it (SUP BIG O NOTATION?). And I cannot emphasize this strongly enough: traditional financial systems are written in code attempting to be efficient. Bitcoin is purposefully wasteful. The mechanism by which it is secure against malicious miners, is to have them each deliberately waste computational time, guessing numbers, such that it would be too costly to cheat. Each miner is significantly less efficient than something like a Visa network. But remember: there are millions of bitcoin miners.

Note that I made no claims about Bitcoin efficiency other than suggesting that this 2.5Mx comparison has a whiff of agenda-biased-bullshit about it.

It isn't very difficult to assess the magnitude in difference between Visa and Bitcoin—though people have done very deep investigative work, and found the ~2.5 Million x to be accurate.

Impartial people ? Links / references ? A brief search only found the Digiconimist article I linked previously     - (and linked poorly - links now fixed!!)

Digiconimist: About:  ". . . . New technologies are rarely perfect, as illustrated by the gigantic environmental impact that the cryptocurrency Bitcoin had (as a result of its mining mechanism). . . . . "

There's your agenda right there in plain view. No impartial analyst would describe themselves or their mission in such blatantly biased terms.


As I said:

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

[maizefolk]

Short selling has always confused me.  There were more than 141% of Gamestop stocks being shorted at one point.  It feels like that couldn't happen if everyone had to borrow a stock to short it.

People were borrowing the shares to sell them to people who in turn loaned them to other people to sell them again.

Imagine a company with 1 share.

Person A owns the share.

Person B  borrows the share from Person A and sells it to person C.

Person D borrows the same share from person C and sells it to person E.

Two different people have each borrowed and sold one share of stock so the short interest is 2 and the number of outstanding shares is 1 so 200% of the company's one shares have been shorted. 

[lifeanon269]

I remain skeptical however that there is a meaningful use case for Bitcoin.   For example, what you just wrote above.     If you have the Strike app you can now spend your Bitcoin at Home Depot.  Great!  Except Home Depot receives payment in US Dollars.  All Strike does is make the conversion for you.

Remember the raison d'etre for Bitcoin is the ability to make trustless transactions.   When you involve Strike and NCR to make the transaction it is no longer trustless.    And if you use Bitcoin, you don't really know from one day to the next or even one hour to the next how much that new Weber pellet smoker is going to cost.   For example, if you were saving up Bitcoin to buy that smoker, the smoker got 20% more expensive over the last six months.  So if there is no price stability and there is no trustless transaction, what is the advantage of using Bitcoin?   

The use case arguments always come down to some version of Bitcoin is great if you live in Venezuela or Iran.  I'll buy that.  But I don't live there.   Most people don't live there.

Let me clarify something because I believe there is some misunderstanding on what Strike is doing here and it is a big part of what makes what Strike is doing so great. Basically Strike is disrupting incumbents that have had almost no competition for over 50 years by replacing them with an open network (Lightning Network/Bitcoin).

I want to clarify, you do not need the Strike app to interact with these merchants. Strike is partnering with NCR and Blackhawk on the point-of-sale (PoS) side to allow merchants to then interact with the Lightning Network for instant settlement. The merchants can choose to receive bitcoin, USD, or any other currency they choose that Strike may support a conversion to. For the customer, since Strike interfaces with the Lightning Network, they just need to use ANY application they so wish that also works over the Lightning Network. The could use their open source wallet like BlueWallet, Breez, Muun, etc. Or they could use a custodial app that interfaces with Lightning like CashApp, or they could use the Strike app itself. The demo that Jack Mallers showed off demonstrated using 3 different wallets to make 3 different purchases. But replacing VISA, Mastercard, Discovercard, etc with an open network, it opens up the customer the option of using an open network to be able to make purchases without needing to have their funds stored with a third-party custodian (an option we've never had digitally before bitcoin). The merchant, they don't really care about the trust-less aspect since they're a legal organization anyway, so working with a trusted third-party vendor like Strike is par for the course. The merchant benefits here by disrupting the incumbents that essentially had a monopoly on PoS payments for an eternity and reap tons of fees from merchants. Strike charges much less fees (due to the lower overhead of using the Lightning Network) and so is a good option for merchants to want to work with.

Open networks almost always win out over closed networks (Internet vs Intranets). Being able to choose what service or app you want to use while being able to instantly integrate with a network/protocol that will interoperate with the rest of the ecosystem is huge. Think internet browsers and how everyone is free to choose the browser they prefer and we can all still browse the same websites. Someone can build a new browser and use it to browse the web. If someone doesn't like the current crop of wallet apps out there, they are free to build a new one and use it instantly to start buying things at these stores. Open networks are terrific and this is what is being built here and it will disrupt the payments industry.

[lifeanon269]

Short selling has always confused me.  There were more than 141% of Gamestop stocks being shorted at one point.  It feels like that couldn't happen if everyone had to borrow a stock to short it.

Yes, it is called naked short selling and IMO it should be illegal.

[maizefolk]

Short selling has always confused me.  There were more than 141% of Gamestop stocks being shorted at one point.  It feels like that couldn't happen if everyone had to borrow a stock to short it.

Yes, it is called naked short selling and IMO it should be illegal.

Naked short selling already is (usually) illegal. The problem is that it still happens and often isn't punished despite being illegal.

[the_gastropod]

. . . 
Bitcoin is on the order of 2.5 Million times less efficient than Visa. 2.5 Million.
. . .

I assume this mighty number comes from the openly anti-Bitcoin Digiconomist article.

For an alternative openly pro-Bitcoin interpretation, see What Bloomberg Gets Wrong About Bitcoin's Climate Footprint.

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

No. This "both sides" thing is, itself, pretty gross Crypto propaganda.

Oh please . . . . "my sources are all good and yours are all bad" ?   WTF ??

The author of this article is Nic Carter—a venture capitalist with colossal investments in crypto. In traditional journalism, having investments in companies bars you from writing about those companies. That is a conflict of interest. Nic Carter's rebuttal here is pure nonsense. I really encourage people to read it to see the childish mental gymnastics he does to try to sow doubt about actual good journalism.

Did you miss the bit where I said he's openly pro-Bitcoin and that there are agendas on both sides ?

Here are several more sources for Bitcoin's environmental impact, if you're interested:

https://ieeexplore.ieee.org/document/9385063
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3779720
https://www.sciencedirect.com/science/article/abs/pii/S2214629619305948?via%3Dihub
https://arxiv.org/pdf/2112.01238.pdf
https://ccaf.io/cbeci/index

I'm familiar with the general issue thanks - I was just querying this 2.5 million thing. However, none of these papers seem to make any mention of a Bitcoin / Visa comparison . . . or 2.5 million . . .

Aside: I'm a software engineer. I have a Computer Science degree. I'm intimately familiar with code efficiency and how to at least estimate it (SUP BIG O NOTATION?). And I cannot emphasize this strongly enough: traditional financial systems are written in code attempting to be efficient. Bitcoin is purposefully wasteful. The mechanism by which it is secure against malicious miners, is to have them each deliberately waste computational time, guessing numbers, such that it would be too costly to cheat. Each miner is significantly less efficient than something like a Visa network. But remember: there are millions of bitcoin miners.

Note that I made no claims about Bitcoin efficiency other than suggesting that this 2.5Mx comparison has a whiff of agenda-biased-bullshit about it.

It isn't very difficult to assess the magnitude in difference between Visa and Bitcoin—though people have done very deep investigative work, and found the ~2.5 Million x to be accurate.

Impartial people ? Links / references ? A brief search only found the Digiconimist article I linked previously     - (and linked poorly - links now fixed!!)

Digiconimist: About:  ". . . . New technologies are rarely perfect, as illustrated by the gigantic environmental impact that the cryptocurrency Bitcoin had (as a result of its mining mechanism). . . . . "

There's your agenda right there in plain view. No impartial analyst would describe themselves or their mission in such blatantly biased terms.


As I said:

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

“Both sidesism” and this notion that any position taken is biased is really bizarre. These arguments are not equally valid. Critics of Exxon-Mobil for their climate denialism campaigns are not “openly anti-Exxon” with a bias that needs to be countered. And, FWIW, I responded directly to Nic Carter’s article, explaining the flaws in his arguments. I didn’t just dismiss him as biased, though I thought it was worth mentioning he has a massive financial stake in convincing others to buy crypto.

What makes this argument even sillier, to me, is that it’s fairly easy to just do this calculation. Take Bitcoin’s global energy usage. Let’s use the University of Cambridge’s estimates (source: https://ccaf.io/cbeci/index) of 146.2 TWh annually. Bitcoin has around 100M transactions annually (source: https://ycharts.com/indicators/bitcoin_transactions_per_day). That is 1.462MWh per transaction. Visa transactions are estimated to take 1.48Wh. Ok, so maybe Bitcoin is only 1 Million times worse than Visa by this latest “study” we’ve just done. But you probably should just discount this, because I’ve shown myself to be biased against Bitcoin ;-)

[MustacheAndaHalf]

If I create a private company with one employee (me) and no profits or business model at all, but issue one trillion shares . . . then sell a single share (to my mom) for one cent . . . I'm now the owner of a company with a market cap of A BILLION DOLLARS!

Market caps are really fun and easy to use if you want to manipulate/inflate the value of something.

I think we'd agree that's fraud, with buying and selling within your family not really constituting a "market".  So it's not really "market cap" without a market.

Meanwhile, CME runs a Bitcoin futures market.  You can buy & sell on that market, get tax forms, etc.
https://www.cmegroup.com/media-room/press-releases/2017/10/31/cme_group_announceslaunchofbitcoinfutures.html

It's not fraud if the shares were publicly traded and mom has no insider information about my business other than me owning it.  100% above board.  Market cap is meaningless when it's so easy to fake a market.

While I don't know securities law in detail, this view seems laughable to me.  Nobody believes a market with you as the only seller and your mom as the only buyer is an arm's length transaction.  Take that view to a lawyer and make their day.

I know a bit more about IRAs since I studied them recently - and there it's not allowed.  If your IRA (more likely your self-directed IRA) makes a trade specifically with your mom, the IRS will strip it's status as an IRA and force distribution of the entire amount with taxes and penalties (according to IRS code 4975 if I remembered right).
https://www.law.cornell.edu/uscode/text/26/4975

Take out the mom part, and make it "a random stranger on the internet". Is the point any different?

My original post discussed crypto market caps, and you and GuitarStv turned it into this tangent about trading with someone's mom being a scam.

As an example of crypto markets, take Coinbase.  $800 million USD worth of BTC and ETH were traded in the past 24 hours.  Willing buyers and willing sellers trading on an established exchange - and a publicly listed one on the US stock market (COIN).
https://coinmarketcap.com/exchanges/coinbase-exchange/

For the largest crypto exchanges using the most traded crypto currencies, would you agree market forces determine the price?

Most crypto exchanges do not list most coins.  Scrolling down to the 8,000th crypto coin by volume shows only $100 of 24h volume, which looks like fraud to me.
WARNING: The following link contains scams.  Do not buy anything you see.
https://coinmarketcap.com/?page=81

But you will also see scams in penny stocks on US markets.  Someone accumulates a significant position, hypes the stock to buyers and draws in their money.  Then the "pump and dump" scammer dumps their shares at a profit.

All of which I would summarize by saying there are scams in crypto exchanges and on public US stock markets, but if you look at larger coins and larger companies, that trade volume is not a scam: it's price discovery that determines the market cap of crypto currencies.

[LateStarter]

. . . 
Bitcoin is on the order of 2.5 Million times less efficient than Visa. 2.5 Million.
. . .

I assume this mighty number comes from the openly anti-Bitcoin Digiconomist article.

For an alternative openly pro-Bitcoin interpretation, see What Bloomberg Gets Wrong About Bitcoin's Climate Footprint.

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

No. This "both sides" thing is, itself, pretty gross Crypto propaganda.

Oh please . . . . "my sources are all good and yours are all bad" ?   WTF ??

The author of this article is Nic Carter—a venture capitalist with colossal investments in crypto. In traditional journalism, having investments in companies bars you from writing about those companies. That is a conflict of interest. Nic Carter's rebuttal here is pure nonsense. I really encourage people to read it to see the childish mental gymnastics he does to try to sow doubt about actual good journalism.

Did you miss the bit where I said he's openly pro-Bitcoin and that there are agendas on both sides ?

Here are several more sources for Bitcoin's environmental impact, if you're interested:

https://ieeexplore.ieee.org/document/9385063
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3779720
https://www.sciencedirect.com/science/article/abs/pii/S2214629619305948?via%3Dihub
https://arxiv.org/pdf/2112.01238.pdf
https://ccaf.io/cbeci/index

I'm familiar with the general issue thanks - I was just querying this 2.5 million thing. However, none of these papers seem to make any mention of a Bitcoin / Visa comparison . . . or 2.5 million . . .

Aside: I'm a software engineer. I have a Computer Science degree. I'm intimately familiar with code efficiency and how to at least estimate it (SUP BIG O NOTATION?). And I cannot emphasize this strongly enough: traditional financial systems are written in code attempting to be efficient. Bitcoin is purposefully wasteful. The mechanism by which it is secure against malicious miners, is to have them each deliberately waste computational time, guessing numbers, such that it would be too costly to cheat. Each miner is significantly less efficient than something like a Visa network. But remember: there are millions of bitcoin miners.

Note that I made no claims about Bitcoin efficiency other than suggesting that this 2.5Mx comparison has a whiff of agenda-biased-bullshit about it.

It isn't very difficult to assess the magnitude in difference between Visa and Bitcoin—though people have done very deep investigative work, and found the ~2.5 Million x to be accurate.

Impartial people ? Links / references ? A brief search only found the Digiconimist article I linked previously     - (and linked poorly - links now fixed!!)

Digiconimist: About:  ". . . . New technologies are rarely perfect, as illustrated by the gigantic environmental impact that the cryptocurrency Bitcoin had (as a result of its mining mechanism). . . . . "

There's your agenda right there in plain view. No impartial analyst would describe themselves or their mission in such blatantly biased terms.


As I said:

Lots of agendas here and I suggest that scepticism should be liberally applied to both sides of the argument.

“Both sidesism” and this notion that any position taken is biased is really bizarre.

That's not what I said. It's perfectly rational to consider the underlying mission of a source when reviewing their statements.
I handle openly pro-Bitcoin Nic Carter's proclamations on the wonders of Bitcoin with caution. I handle openly anti-Bitcoin Digiconimist's proclamations on the evils of Bitcoin with caution.

That doesn't mean all sources are biased. I assume that Cambridge Uni's declared mission relates to solid impartial science and my guess is that they're fairly trustworthy. I'm more inclined to take their findings at face value.

These arguments are not equally valid. Critics of Exxon-Mobil for their climate denialism campaigns are not “openly anti-Exxon” with a bias that needs to be countered.

"openly" is not the issue.

Are you really suggesting that no "critics of Exxon-Mobil for their climate denialism campaigns" are fundamentally "anti-Exxon" and/or anti fossil fuels in general ? You can't be serious - that's ludicrously naive - and quite obviously wrong.
It doesn't mean their arguments are false, but only a fool would ignore the context / underlying mission of the source.

And, FWIW, I responded directly to Nic Carter’s article, explaining the flaws in his arguments. I didn’t just dismiss him as biased, though I thought it was worth mentioning he has a massive financial stake in convincing others to buy crypto.

Yeah, I thought that was worth mentioning too - I also clearly mentioned that he has an agenda.
Notably, you still haven't acknowledged that your number also seems to come from a source with an agenda. Confirmation bias ?

What makes this argument even sillier, to me, is that it’s fairly easy to just do this calculation. Take Bitcoin’s global energy usage. Let’s use the University of Cambridge’s estimates (source: https://ccaf.io/cbeci/index) of 146.2 TWh annually. Bitcoin has around 100M transactions annually (source: https://ycharts.com/indicators/bitcoin_transactions_per_day). That is 1.462MWh per transaction. Visa transactions are estimated to take 1.48Wh. Ok, so maybe Bitcoin is only 1 Million times worse than Visa by this latest “study” we’ve just done. But you probably should just discount this, because I’ve shown myself to be biased against Bitcoin ;-)

Yeah, pulling loosely related numbers together and comparing them as like-for-like equivalents is trivially easy, as you've demonstrated. It might be fun, but it's not science.