Author Topic: Bitcoin is funny money  (Read 178048 times)

JLee

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Re: Bitcoin is funny money
« Reply #700 on: May 24, 2021, 01:22:15 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

The first post to say scam in the context of Tether was the very post you refer to as proof in your claim that it isn't a scam. Ironic, isn't it?

the_gastropod

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Re: Bitcoin is funny money
« Reply #701 on: May 24, 2021, 01:26:17 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

I guess we'll all learn at some point. But if you think it's legit that Tether holds more corporate paper than Vanguard, your spidy-sense for fraud is clearly less sensitive than mine. I'd also urge you to check out the graph of the price of USDT over the past ~1.5 months, which includes the period of time the NYAG was investigating them. You can see it yourself here (https://coinmarketcap.com/currencies/tether/). If this looks legit to you, well.... that's interesting.

« Last Edit: May 24, 2021, 01:30:40 PM by the_gastropod »

SuperSecretName

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Re: Bitcoin is funny money
« Reply #702 on: May 24, 2021, 01:40:55 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

The first post to say scam in the context of Tether was the very post you refer to as proof in your claim that it isn't a scam. Ironic, isn't it?
The medium article calls it a fraud. There are a number of things the author doesn't understand (e.g. printing in round numbers, correlation and not causation, the deposit account structure).

And oh BTW, Tether just printed another 3B in the past few days.

I don't even care about Tether, but the same false arguments come up again and again.

JLee

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Re: Bitcoin is funny money
« Reply #703 on: May 24, 2021, 01:44:38 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

The first post to say scam in the context of Tether was the very post you refer to as proof in your claim that it isn't a scam. Ironic, isn't it?
The medium article calls it a fraud. There are a number of things the author doesn't understand (e.g. printing in round numbers, correlation and not causation, the deposit account structure).

And oh BTW, Tether just printed another 3B in the past few days.

I don't even care about Tether, but the same false arguments come up again and again.

Then debunk it instead of handwaving ;)

SuperSecretName

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Re: Bitcoin is funny money
« Reply #704 on: May 24, 2021, 01:45:13 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

I guess we'll all learn at some point. But if you think it's legit that Tether holds more corporate paper than Vanguard, your spidy-sense for fraud is clearly less sensitive than mine. I'd also urge you to check out the graph of the price of USDT over the past ~1.5 months, which includes the period of time the NYAG was investigating them. You can see it yourself here (https://coinmarketcap.com/currencies/tether/). If this looks legit to you, well.... that's interesting.
There might be a scale issue here.  Most of the time it trades in the 99-101 range.  It's not perfect, but that's good enough for most people.  I don't know why it was more flat for a month there.  NYAG has been on them for years.

SuperSecretName

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Re: Bitcoin is funny money
« Reply #705 on: May 24, 2021, 01:48:00 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

The first post to say scam in the context of Tether was the very post you refer to as proof in your claim that it isn't a scam. Ironic, isn't it?
The medium article calls it a fraud. There are a number of things the author doesn't understand (e.g. printing in round numbers, correlation and not causation, the deposit account structure).

And oh BTW, Tether just printed another 3B in the past few days.

I don't even care about Tether, but the same false arguments come up again and again.

Then debunk it instead of handwaving ;)
https://bitcoinmagazine.com/markets/debunking-misconceptions-from-the-bit-short-inside-cryptos-doomsday-machine
https://danheld.substack.com/p/dont-fear-tether
https://medium.com/@nic__carter/assessing-bitcoins-liquidity-with-coinlib-data-is-indefensible-3e5fdad51646

JLee

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Re: Bitcoin is funny money
« Reply #706 on: May 24, 2021, 02:05:39 PM »
Saying there are risks in Tether is different than calling it a scam.

In the past few days, another 3B was printed.  So they took in 3B in deposits, and then do what they do to earn the yield.  It's not quite fractional reserve, as they aren't creating extra money based on deposits - it's that the deposits are not 100% sitting in a bank somewhere.  I agree, they are unregulated and vulnerable to a run.  Still doesn't make it a scam though.

And in the volatility, the peg has been maintained.  So, pretty stable all things considered.

The first post to say scam in the context of Tether was the very post you refer to as proof in your claim that it isn't a scam. Ironic, isn't it?
The medium article calls it a fraud. There are a number of things the author doesn't understand (e.g. printing in round numbers, correlation and not causation, the deposit account structure).

And oh BTW, Tether just printed another 3B in the past few days.

I don't even care about Tether, but the same false arguments come up again and again.

Then debunk it instead of handwaving ;)
https://bitcoinmagazine.com/markets/debunking-misconceptions-from-the-bit-short-inside-cryptos-doomsday-machine
https://danheld.substack.com/p/dont-fear-tether
https://medium.com/@nic__carter/assessing-bitcoins-liquidity-with-coinlib-data-is-indefensible-3e5fdad51646

From your first link:
Quote
Again, Tether Limited is a black box and we cannot say for certain how it manages its business

From your second link:
Quote
I want to note that I feel weird defending Tether and Bitfinex. I don’t particularly like either company, as they’ve done a ton of shady things over the years. I am not vouching for the long term durability of either company.

The third link basically seems to be saying "offshore crypto stuff is so shady that we can't trust the numbers to be accurate."

If not definitively fraud, this absolutely reeks of the potential. They surely didn't get an $18.5 million fine by being on the up and up.
« Last Edit: May 24, 2021, 02:07:41 PM by JLee »

JAYSLOL

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Re: Bitcoin is funny money
« Reply #707 on: May 27, 2021, 10:13:04 PM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors. 

Juan Ponce de León

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Re: Bitcoin is funny money
« Reply #708 on: May 27, 2021, 11:19:18 PM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors.

So you're annoyed the inexperienced plebs have a seat at the table?  To me that's its strength.

DaKini

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Re: Bitcoin is funny money
« Reply #709 on: May 28, 2021, 02:01:00 AM »
So you're annoyed the inexperienced plebs have a seat at the table?  To me that's its strength.

Strength? If random people buy an asset because "it always goes up"?
For me it's pretty obvious from the chart, that we are currently in the milking phase, where the last round of fresh money is moving from those plebs up the pyramid.

JAYSLOL

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Re: Bitcoin is funny money
« Reply #710 on: May 28, 2021, 03:34:07 AM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors.

So you're annoyed the inexperienced plebs have a seat at the table?  To me that's its strength.

Not annoyed, I find it sad to be honest.  Too many people who aren't in a position to lose money likely will, including a bunch of people I know who are getting in late and really deep.  I have no skin in the game (anymore, I did play with it years ago to learn about it, but have no desire to continue).  People can do whatever they want with their money, it doesn't annoy me.  I'm not offended by newbies getting into investing (which crypto isn't, I'd be kind calling it speculation), but when everyone including the guy who pumps gas (or shines shoes?) has plied on the latest trend it doesn't usually end well.  I think you might be mistaking "strength" for "whats good for me, since i got in earlier"
« Last Edit: May 28, 2021, 04:02:50 AM by JAYSLOL »

talltexan

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Re: Bitcoin is funny money
« Reply #711 on: May 28, 2021, 07:08:23 AM »
My system told me to buy this morning, so I put some in (although less than the system said to do). Hoping for one more "puff" at the cigar.

SuperSecretName

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Re: Bitcoin is funny money
« Reply #712 on: May 28, 2021, 07:32:43 AM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors.
I see you your blue-collar and raise you white-collar with Ray Dalio, Carl Icahn and Stanley Druckenmiller.

Come for the memes and gainz, stay for the financial freedom.

JAYSLOL

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Re: Bitcoin is funny money
« Reply #713 on: May 28, 2021, 08:13:49 AM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors.
I see you your blue-collar and raise you white-collar with Ray Dalio, Carl Icahn and Stanley Druckenmiller.

Come for the memes and gainz, stay for the financial freedom.

Financial freedom on the backs of the guys stocking the grocery store shelves?  Nah, I’ll pass.  The memes sure are fun though

SuperSecretName

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Re: Bitcoin is funny money
« Reply #714 on: May 28, 2021, 08:33:02 AM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors.
I see you your blue-collar and raise you white-collar with Ray Dalio, Carl Icahn and Stanley Druckenmiller.

Come for the memes and gainz, stay for the financial freedom.

Financial freedom on the backs of the guys stocking the grocery store shelves?  Nah, I’ll pass.  The memes sure are fun though
I think you misunderstood.  Financial freedom for them also.

The screws on the middle-class have been tightening the last 50 years.  That grocery worker likely works 32 hours a week (not 40, to get around labor laws), does not have a set schedule, and is making less in real wages than 30 years ago.  Their savings have been continually debased in favor of the rich.

So, yeah, them gambling on stupid shit is a symptom of the broader economic problem.  Perhaps they stick with Bitcoin, because the current system certainly isn't working for them.

JAYSLOL

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Re: Bitcoin is funny money
« Reply #715 on: May 28, 2021, 04:46:10 PM »
Honestly we must be getting near peak crypto bubble, I literally can’t go anywhere without hearing about crypto from the 20-30 year olds with entry level jobs crowd including people I work with, yesterday three kids stocking shelves at the grocery store, the attendant at the gas station and a customer, and people I know on Facebook who I wouldn’t peg as experienced investors.
I see you your blue-collar and raise you white-collar with Ray Dalio, Carl Icahn and Stanley Druckenmiller.

Come for the memes and gainz, stay for the financial freedom.

Financial freedom on the backs of the guys stocking the grocery store shelves?  Nah, I’ll pass.  The memes sure are fun though
I think you misunderstood.  Financial freedom for them also.

The screws on the middle-class have been tightening the last 50 years.  That grocery worker likely works 32 hours a week (not 40, to get around labor laws), does not have a set schedule, and is making less in real wages than 30 years ago.  Their savings have been continually debased in favor of the rich.

So, yeah, them gambling on stupid shit is a symptom of the broader economic problem.  Perhaps they stick with Bitcoin, because the current system certainly isn't working for them.

So it’ll just be someone else further down that loses their shirt.  Crypto is a zero sum game, there’s no value being created by owning the coin itself (yes I get the that use of the coin provides a certain value, but holding it doesn’t create value the way actual stocks or real estate would).  I agree there are economic issues with everything from labour rights, wages, economic inequality etc.  I fail to see how someone facing the brunt of those issues is better off risking what little they can accumulate into crypto.

SoBurntImCharred

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Re: Bitcoin is funny money
« Reply #716 on: May 28, 2021, 06:28:36 PM »
This forum has been great for me. I've gone from an extreme negative net worth and crippling feelings of despair to incorporating sound personal finance principles and working towards financial independence. The advice on this forum has been right about almost everything; but in my humble opinion, is dead wrong about Bitcoin. Ultimately, investments are a personal choice, and I live with the consequences, but I sure wish I would've investigated Bitcoin more when I was interested in it years ago.

Bitcoin has a tremendous use case as a store of wealth and an unseizable asset. It is not intended to create value, but rather to store value. If you are expecting it to create value, then you are thinking like a short-term speculator. In the long term, Bitcoin will take a big bite out of the market capitalization of gold, bonds, and other wealth-preserving assets. It is not intended to perform like an equity. The volatility associated with it currently is a simple reflection of the risk/reward relationship playing out for early adopters.

Not a single person that has ever held Bitcoin for a four-year span has ever lost money. Institutional money is piling into the space. The days of considering Bitcoin a ponzi scheme are over.

I hope newbies reading this forum feel compelled to do a little digging and consider alternate opinions. In particular, read the humanitarian cases for Bitcoin written by Alex Gladstein. As a forum that is designed to advocate for sound financial management, I would hope that we'd be able to call out our government's mismanagement when appropriate.

Cheers

ChpBstrd

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Re: Bitcoin is funny money
« Reply #717 on: May 28, 2021, 07:45:37 PM »
Bitcoin has a tremendous use case as a store of wealth and an unseizable asset. It is not intended to create value, but rather to store value. If you are expecting it to create value, then you are thinking like a short-term speculator. In the long term, Bitcoin will take a big bite out of the market capitalization of gold, bonds, and other wealth-preserving assets. It is not intended to perform like an equity.

I suspect the use case for crypto as a store of wealth is related to the low - now negative - real yield on safe assets like 10 year treasuries. These treasury assets are no longer "safe" when they guarantee a loss of purchasing power, and when bond convexity means huge losses in the event of small interest rate increases. I wonder how the enthusiasm for crypto would hold up if we returned to 2% - 4% real yields on treasuries like we had in the not too distant past. 



But yes, 99% of crypto investors are not in it as an alternative to treasuries, they're into it for speculation. And no, I'm under no illusions about the lack of real returns on safe assets being a rationale for their speculation - "it went up astronomically in the past" is a good enough rationale for most.

JAYSLOL

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Re: Bitcoin is funny money
« Reply #718 on: May 28, 2021, 10:47:08 PM »
See, this is what confuses me about crypto, the argument that people will use it as a store of wealth.  No, I don’t think they will.  Literally nobody I’ve met is in crypto to store their wealth, they’re in it to go “to the moon”, so the moment a coin becomes a store of wealth rather than speculation/gambling my guess is they’re all out.  That goes for everyone from the teenager that doesn’t have much wealth to store anyways, right on up to the institutional investors, a company taking a stake in a coin isn’t going to bother if it just means preserving their capital, they’re only in it to ride the bubble upwards.  Bubble isn’t expanding anymore?  They’ll find another place to park their capital
« Last Edit: May 28, 2021, 10:48:41 PM by JAYSLOL »

effigy98

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Re: Bitcoin is funny money
« Reply #719 on: May 28, 2021, 11:00:00 PM »
Literally nobody I’ve met is in crypto to store their wealth

I store a part of my wealth in crypto... Dollar cost average on an automated schedule over 5 years. Get massive interest payments from BlockFi which is larger then my cost basis of the original crypto by a large margin... But I guess NOBODY stores their wealth in crypto. I also know a lot of people who do the same, but I live in a tech hub so maybe that is the difference.

What really convinced me to do this was the power of diversified asset classes as in the https://portfoliocharts.com/portfolio/golden-butterfly/. You add a little BTC and ETH (say 6%) to your asset allocation and it really improves your risk / reward ratio. The volatility actually becomes a benefit as you rebalance when assets drift too much. You can backtest this with something like GBTC and get an idea why it is so valuable on portfoliovisualizer as an uncorrelated asset class. You have the moon potential as well, but that is just gravy imo.
« Last Edit: May 28, 2021, 11:17:58 PM by effigy98 »

SuperSecretName

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Re: Bitcoin is funny money
« Reply #720 on: May 29, 2021, 07:00:58 AM »
Literally nobody I’ve met is in crypto to store their wealth
Hi, nice to meet you.

I have a diversified portfolio of stocks, real estate, gold, art and bitcoin (but no bonds, as ChpBstrd rightly pointed out, we've been in a 40 year rate downtrend).  All working to store my wealth, and rotating amongst them as situations demand.

Do I think Bitcoin is going up?  Yes.  Would I hold it even if it wasn't?  Yes.  Why?  Sovereignty.  The same way that holding a gold coin in your hand feels magical, holding Bitcoin represents freedom.

And, be careful of no true Scotsman arguments: https://en.wikipedia.org/wiki/No_true_Scotsman
« Last Edit: May 29, 2021, 07:07:04 AM by SuperSecretName »

scottish

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Re: Bitcoin is funny money
« Reply #721 on: May 29, 2021, 08:08:17 AM »
Except I can bathe in my gold coins and feel their sensuous touch on my skin.

Can't do that with a crypto token!

seattlecyclone

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Re: Bitcoin is funny money
« Reply #722 on: May 29, 2021, 10:50:47 AM »
The unseizability is largely overrated anyway. If you write down your private key somewhere that physical medium can be seized. If you don't, nobody can take it from you but they can kill you and your coins will die with you. Or if you're ordered to turn over your coins to another party to repay your creditors a judge isn't going to be too pleased with you if you say "no." If you'd rather sit in jail for contempt of court than hand over your coins I guess that's an option available to you, but it's not a great option.

SoBurntImCharred

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Re: Bitcoin is funny money
« Reply #723 on: May 29, 2021, 12:16:35 PM »
Thanks for the thoughtful responses.

ChpBstrd, I agree that a 4%+ real yield on safe assets would diminish the appeal of Bitcoin to some degree by those seeking a safe haven. I think a general criticism of our financial system right now is that it overly penalizes savers to the benefit of investors/speculators. Look no further than our obsession with sequence of return risk, or the political discourse surrounding the economy on any given day. An updated chart shows real yields that have been struggling to break 1% over the last decade and are currently negative. https://www.yardeni.com/pub/nomrealyield.pdf

To those that would discount its value due to being mostly unseizable, I would again strongly suggest that you search for Alex Gladstein's commentary, starting with the following: https://bitcoinmagazine.com/culture/check-your-financial-privilege. From the article:

"The critics cited above are all wealthy citizens of advanced economies, where they benefit from liberal democracy, property rights, free speech, a functioning legal system and relatively stable reserve currencies like the dollar or pound.

In reality, only 13% of our planet’s population is born into the dollar, euro, Japanese yen, British pound, Australian dollar, Canadian dollar or Swiss Franc. The other 87% are born into autocracy or considerably less trustworthy currencies. 4.3 billion people live under authoritarianism, and 1.2 billion people live under double- or triple-digit inflation.

Critics in the dollar bubble miss the bigger global picture: that anyone with access to the internet can now participate in Bitcoin, a new money system with equal rules for all participants, running on a network that does not censor or discriminate, used by individuals who do not need to show a passport or an ID and held by citizens in a way that is hard to confiscate and impossible to debase."

Other common objections to Bitcoin, both of which I've harbored at some point in my personal past and have had to reconcile, include (1) the moral/ethical concerns of a currency that can operate outside of regulatory reach and (2) the environmental impact of its proof-of-work model. Without turning this post into more of a novel, please consider the amount of crime conducted in US dollars, the despair imposed on lower classes by an economic system that hollows out our economy, the needless wars that we've been involved with for decades at great human and capital cost, the energy requirements of a military industrial complex and banking system that perpetuate the current system, and the benefits of an alternate system that could economically incentive green energy development in any remote region with an internet connection.

I readily admit that all of the above will make me appear as just another shill. I also acknowledge extreme volatility that requires caution. I only suggest entertaining the idea that Bitcoin has worth beyond being viewed as a 21st century tulip.

SoBurntImCharred

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Re: Bitcoin is funny money
« Reply #724 on: May 29, 2021, 12:32:26 PM »
Would I hold it even if it wasn't?  Yes.  Why?  Sovereignty.  The same way that holding a gold coin in your hand feels magical, holding Bitcoin represents freedom.

Bitcoin is FreedomCoin, and I'm bullish on freedom long-term.

GuitarStv

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Re: Bitcoin is funny money
« Reply #725 on: May 29, 2021, 04:41:02 PM »
If you don't, nobody can take it from you but they can kill you and your coins will die with you.

I think this is usually seen as a feature, not a bug.  People who hold bitcoin benefit when there's less bitcoin . . . so as people die and their keys/coins are lost they win.  This is the scenario that a bitcoin 'investor' should be rooting for.

seattlecyclone

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Re: Bitcoin is funny money
« Reply #726 on: May 29, 2021, 04:46:18 PM »
If you don't, nobody can take it from you but they can kill you and your coins will die with you.

I think this is usually seen as a feature, not a bug.  People who hold bitcoin benefit when there's less bitcoin . . . so as people die and their keys/coins are lost they win.  This is the scenario that a bitcoin 'investor' should be rooting for.

Other people's bitcoins disappearing is a feature. My bitcoins disappearing instead of passing on to my heirs is a bug. :-)

There is a fundamental problem here, because everything you might do to ensure your coins can pass along to your intended recipients (such as writing the private key down in multiple places they're sure to find it) will also make it more likely for the key to fall into the wrong hands and for your coins to be irrevocably stolen.

GuitarStv

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Re: Bitcoin is funny money
« Reply #727 on: May 29, 2021, 04:53:08 PM »
If you don't, nobody can take it from you but they can kill you and your coins will die with you.

I think this is usually seen as a feature, not a bug.  People who hold bitcoin benefit when there's less bitcoin . . . so as people die and their keys/coins are lost they win.  This is the scenario that a bitcoin 'investor' should be rooting for.

Other people's bitcoins disappearing is a feature. My bitcoins disappearing instead of passing on to my heirs is a bug. :-)

There is a fundamental problem here, because everything you might do to ensure your coins can pass along to your intended recipients (such as writing the private key down in multiple places they're sure to find it) will also make it more likely for the key to fall into the wrong hands and for your coins to be irrevocably stolen.

Every person who owns bitcoin belives himself to be smarter than every other person who owns bitcoin though . . . so this is really going to be seen as a feature.  Surely you will never be so stupid as to end up dying with your bitcoins disappearing forever.  That's for those dumb bitcoin holders . . .

SoBurntImCharred

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Re: Bitcoin is funny money
« Reply #728 on: May 29, 2021, 05:22:25 PM »
I understand the skepticism; again, I was there. This is also not 2011 anymore, though. Please research casa wallets for an example of multisig security.

I would argue that if you have a significant sum allocated, that you would educate your beneficiaries on how to retrieve the coins.

Regarding the example given of potential prison time for not surrendering keys, I suppose we should feel grateful that we haven't faced that scenario? If you were facing that scenario, would you rather have your assets in a bank?

I haven't seen many people arguing that they're smarter than others for investing in Bitcoin, perhaps just that they're more open-minded or even lucky that they stumbled into it. On the contrary, I've seen many argue that they are smarter for not investing in it.

Telecaster

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Re: Bitcoin is funny money
« Reply #729 on: May 29, 2021, 06:12:55 PM »
Without turning this post into more of a novel, please consider the amount of crime conducted in US dollars, the despair imposed on lower classes by an economic system that hollows out our economy, the needless wars that we've been involved with for decades at great human and capital cost, the energy requirements of a military industrial complex and banking system that perpetuate the current system, and the benefits of an alternate system that could economically incentive green energy development in any remote region with an internet connection.

The part I don't get is how Bitcoin changes anything.  Let's say everyone adopts Bitcoin tomorrow.  Does that mean there are no more banks?  No more payday loans?  No more loan sharks?  No more motivation for wars? 

seattlecyclone

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Re: Bitcoin is funny money
« Reply #730 on: May 29, 2021, 06:24:47 PM »
I understand the skepticism; again, I was there. This is also not 2011 anymore, though. Please research casa wallets for an example of multisig security.

I would argue that if you have a significant sum allocated, that you would educate your beneficiaries on how to retrieve the coins.

Educating them on how to retrieve the coins will inherently cause more people to have access to your coins, and thereby increase the size of your potential attack surface. There's really no way around this.

Quote
Regarding the example given of potential prison time for not surrendering keys, I suppose we should feel grateful that we haven't faced that scenario? If you were facing that scenario, would you rather have your assets in a bank?

I would personally not choose incarceration over paying debts that my local authorities have judged that I owe. So for me it's no real difference. Either they seize the money out of my bank account or I give up my bitcoins to avoid a contempt charge. Either way the money is gone. Only if you'd choose incarceration (or whatever other punishment your authorities would see fit to impose) does bitcoin provide an advantage.

SoBurntImCharred

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Re: Bitcoin is funny money
« Reply #731 on: May 29, 2021, 08:41:04 PM »
The part I don't get is how Bitcoin changes anything.  Let's say everyone adopts Bitcoin tomorrow.  Does that mean there are no more banks?  No more payday loans?  No more loan sharks?  No more motivation for wars?

All good questions.

Banks provide a valuable service, but currently have an insane amount of unchecked power. Who was bailed out with taxpayer dollars during the great recession? It wasn't the debtors. What enabled that bailout? What enables the continuous liquidity infusions that are required to fund banks' speculation?

Payday loans and loan sharks. Does their prevalence correlate at all to financial despair among lower classes? Could real wages that are retreating relative to real costs contribute to that? What system contributes to that scenario?

Motivation for wars. This is a big one. What have our wars been about over the last several decades? Is it about spreading democracy to all? Are we worried about WMDs? Are we fighting for women's rights, as recently suggested in Afghanistan? Or, is it to maintain US hegemony and beat back any threats to the dollar as the global reserve currency? Do we have domestic interests that benefit greatly from going to war? If the dollar does lose its status as the global reserve currency, who stands to gain and who stands to lose?

SoBurntImCharred

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Re: Bitcoin is funny money
« Reply #732 on: May 29, 2021, 08:56:28 PM »
Educating them on how to retrieve the coins will inherently cause more people to have access to your coins, and thereby increase the size of your potential attack surface. There's really no way around this.
What's the argument here? For a single person, multisig authentication solves this. If worried about heirs, are you saying that you can't trust them during your life, but you want them to be able to access your money after your dead?

I'm sure there is a place for a drawn-out security argument, but I would simply say that the days of writing down a key somewhere on a piece of paper and being fucked if you lose it are over. If you have greater concerns with current security tools, I would suggest you speak with an expert to alleviate any concerns you have, just as you would with any asset.
Quote
I would personally not choose incarceration over paying debts that my local authorities have judged that I owe. So for me it's no real difference. Either they seize the money out of my bank account or I give up my bitcoins to avoid a contempt charge. Either way the money is gone. Only if you'd choose incarceration (or whatever other punishment your authorities would see fit to impose) does bitcoin provide an advantage.
And if you don't have the option of paying to avoid jail? And if you are wrongly accused/convicted? You don't have to value those use cases, but they exist.

Bitcoin may not be for you, but it's far from a tulip. The forum has a clear consensus on Bitcoin, but a dissenting voice is valuable, if for no other reason than to reaffirm your investment strategy.

Telecaster

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Re: Bitcoin is funny money
« Reply #733 on: May 29, 2021, 11:26:56 PM »
The part I don't get is how Bitcoin changes anything.  Let's say everyone adopts Bitcoin tomorrow.  Does that mean there are no more banks?  No more payday loans?  No more loan sharks?  No more motivation for wars?

All good questions.

Banks provide a valuable service, but currently have an insane amount of unchecked power. Who was bailed out with taxpayer dollars during the great recession? It wasn't the debtors. What enabled that bailout? What enables the continuous liquidity infusions that are required to fund banks' speculation?

Payday loans and loan sharks. Does their prevalence correlate at all to financial despair among lower classes? Could real wages that are retreating relative to real costs contribute to that? What system contributes to that scenario?

Motivation for wars. This is a big one. What have our wars been about over the last several decades? Is it about spreading democracy to all? Are we worried about WMDs? Are we fighting for women's rights, as recently suggested in Afghanistan? Or, is it to maintain US hegemony and beat back any threats to the dollar as the global reserve currency? Do we have domestic interests that benefit greatly from going to war? If the dollar does lose its status as the global reserve currency, who stands to gain and who stands to lose?

I see lots of questions, I don't see any answers.  Let me rephrase:  Let's say everyone adopts Bitcoin tomorrow.  Does that mean there are no more banks?  No more payday loans?  No more loan sharks?  No more motivation for wars?

You made some interesting claims. How, specifically does Bitcoin fix any of the problems you mentioned?  Again, we'll assume widepread adoption of Bitcoin. For example, if everyone was using Bitcoin exactly how would that mitigate despair among lower classes?

seattlecyclone

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Re: Bitcoin is funny money
« Reply #734 on: May 29, 2021, 11:39:51 PM »
Educating them on how to retrieve the coins will inherently cause more people to have access to your coins, and thereby increase the size of your potential attack surface. There's really no way around this.
What's the argument here? For a single person, multisig authentication solves this. If worried about heirs, are you saying that you can't trust them during your life, but you want them to be able to access your money after your dead?

In some sense, yes. It's not that I expect the people named in my will to actively steal my coins, but more that they might fail to properly secure the keys, allowing them to pass into the hands of someone who would steal from me. The more people who have access to your keys, the more chances there are for someone in that chain of custody to mess up. Your security is only as strong as your weakest link.

What would it take to make sure that my coins don't go poof into the ether once I die? If it's just me dying, my wife gets everything. She'll need a way to get into my wallet when the time comes. I trust her, and I think she can make reasonable choices about computer security. What if she dies first? Next in line are my kids. They're not even in elementary school yet, so my sister would take custody of the kids and our money (until they turn 18). So now my sister needs to have a way to access my private keys too. What if my wife and kids and I all die together in a house fire or car crash or other tragic accident? This is reasonably possible and prudent to plan for. Next in line are my parents and in-laws, so now we've got four elderly people, known to leave passwords written on post-it notes in plain sight, who also need to be able to access my crypto wallet in an emergency.

Where to put the copies of the keys to keep them safe but also accessible to all those folks as needed? It would be great if they could all have a copy that they encrypted with a strong, unique password that they commit to memory so that there's no physical artifact that could fall into the wrong hands. That's a fantasy. Nobody's going to remember a password that they made years ago when their relative was writing their will. They'll need to have some instructions written down somewhere. Maybe we find a trusted third party (an estate lawyer or a bank safe deposit box) to give our keys to. Now we need to trust them not to lose the keys.

None of this is a concern with my IRA investments. I've told Vanguard who my beneficiaries are. Upon receiving my death certificate they'll do the right thing. If for some reason they don't do the right thing, we have a legal system that can generally sort it out.

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Re: Bitcoin is funny money
« Reply #735 on: May 29, 2021, 11:53:58 PM »
The forum has a clear consensus on Bitcoin

A clear consensus ????  Rofl.

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Re: Bitcoin is funny money
« Reply #736 on: June 01, 2021, 07:19:25 AM »
Imagine if a genie appeared and offered to tell you about a no-name small-cap stock in a boring industry that is destined return 20% per year for the next 20 years without anyone even noticing it. The catch is that if you ever gloat or promote it on the internet, your whole investment will disappear. Would you take the deal?

Yea, that's how I feel about investment ideas that require social media evangelists.

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Re: Bitcoin is funny money
« Reply #737 on: June 01, 2021, 09:39:46 AM »
Imagine if a genie appeared and offered to tell you about a no-name small-cap stock in a boring industry that is destined return 20% per year for the next 20 years without anyone even noticing it. The catch is that if you ever gloat or promote it on the internet, your whole investment will disappear. Would you take the deal?

Yea, that's how I feel about investment ideas that require social media evangelists.
It doesn't require anything.  The few of us are in here are attempting to correct common misconceptions.  Go figure that on a message board about finance, a revolutionary financial invention would have some fans.

Although yes, as someone who has drank the kool-aid, I freely admit it does feel at times like religious zealotry.  Worshipping at the altar of math and sovereignty.  Have you heard the good news?

the_gastropod

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Re: Bitcoin is funny money
« Reply #738 on: June 01, 2021, 10:06:49 AM »
Imagine if a genie appeared and offered to tell you about a no-name small-cap stock in a boring industry that is destined return 20% per year for the next 20 years without anyone even noticing it. The catch is that if you ever gloat or promote it on the internet, your whole investment will disappear. Would you take the deal?

Yea, that's how I feel about investment ideas that require social media evangelists.
It doesn't require anything.  The few of us are in here are attempting to correct common misconceptions.  Go figure that on a message board about finance, a revolutionary financial invention would have some fans.

Although yes, as someone who has drank the kool-aid, I freely admit it does feel at times like religious zealotry.  Worshipping at the altar of math and sovereignty.  Have you heard the good news?

Right. But the zealotry of bitcoiners (and crypto enthusiasts, at large) isn't coincidental. As a zero-sum game, it's necessary. The revolutionary thing about cryptocurrency is that it's basically a distributed MLM. And MLM's have a reputation for being cult-like for a reason. Crypto takes this to the next level.

What's amazing reading through this thread is just how cult-like the responses are. There's not been a single articulation of a single concrete benefit of using cryptocurrency (beyond some deeeeeply hand-wavy extreme libertarian technobabble). And the "solutions" that are mentioned are solutions to problems cryptocurrency created in the first place (e.g., "oh, you should research double-x-extreme wallets, noob! It solves the whole leaving coins to your family problem!").

To use an analogy, cryptocurrency is basically like building homes out of oatmeal. Like... you could do it. And there'd be myriad problems doing this. But along the way, people could, for example, feasibly come up with a brick made out of oatmeal to solve the collapsing wall problem. And maybe for some people in countries where starvation is a massive problem, you could argue that it makes some sense to build homes out of oatmeal. But ultimately, it's a pretty ridiculous idea for the majority of people, innovative though it is.
« Last Edit: June 01, 2021, 10:09:28 AM by the_gastropod »

StashingAway

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Re: Bitcoin is funny money
« Reply #739 on: June 01, 2021, 10:08:44 AM »
Worshipping at the altar of math and sovereignty.  Have you heard the good news?

Lol no one is denying a) the math or b) sovereignty as a principle

That's the equivalent of me saying that I worship being healthy in a discussion about essential oils.

"Cum hoc ergo propter hoc" Bitcoin uses math, therefore it must be good!

SuperSecretName

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Re: Bitcoin is funny money
« Reply #740 on: June 01, 2021, 10:15:24 AM »
There's not been a single articulation of a single concrete benefit of using cryptocurrency (beyond some deeeeeply hand-wavy extreme libertarian technobabble).
::sigh::

1st, separate Bitcoin from everything else.
2nd, state-free money that is immune to seizure or debasement is a benefit in and of itself. 
3rd, you know what the #1 app in El Salvador is right now?  It's a remittance app, run on Bitcoin (https://strike.me/) .  Instead of paying 20% to Western Union, the receiver gets 99+% (not sure the exact number, but higher than 99%).

Maybe have another read of this:

To those that would discount its value due to being mostly unseizable, I would again strongly suggest that you search for Alex Gladstein's commentary, starting with the following: https://bitcoinmagazine.com/culture/check-your-financial-privilege. From the article:

"The critics cited above are all wealthy citizens of advanced economies, where they benefit from liberal democracy, property rights, free speech, a functioning legal system and relatively stable reserve currencies like the dollar or pound.

In reality, only 13% of our planet’s population is born into the dollar, euro, Japanese yen, British pound, Australian dollar, Canadian dollar or Swiss Franc. The other 87% are born into autocracy or considerably less trustworthy currencies. 4.3 billion people live under authoritarianism, and 1.2 billion people live under double- or triple-digit inflation.

Critics in the dollar bubble miss the bigger global picture: that anyone with access to the internet can now participate in Bitcoin, a new money system with equal rules for all participants, running on a network that does not censor or discriminate, used by individuals who do not need to show a passport or an ID and held by citizens in a way that is hard to confiscate and impossible to debase."
« Last Edit: June 01, 2021, 10:23:24 AM by SuperSecretName »

SuperSecretName

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Re: Bitcoin is funny money
« Reply #741 on: June 01, 2021, 10:26:50 AM »
Bitcoin uses math, therefore it must be good!
Not that it uses math so it must be good.  But, it uses math to verify with 100% certainty what has happened, and what will happen with the monetary policy, and that certainty is good.

SuperSecretName

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Re: Bitcoin is funny money
« Reply #742 on: June 01, 2021, 10:36:48 AM »
Bitcoin is not intuitive, and takes a while to have it sink it and the light bulb go off.

For the detractors, I'm guessing there are large gaps in your knowledge in how it works.  I'd recommend taking this free course.
https://learn.saylor.org/course/view.php?id=468

If you still hate it at that point, god bless.  But at least you will have a full understanding of it.

the_gastropod

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Re: Bitcoin is funny money
« Reply #743 on: June 01, 2021, 10:41:23 AM »
::sigh::

1st, separate Bitcoin from everything else.
Hmm?

2nd, state-free money that is immune to seizure or debasement is a benefit in and of itself. 

1. Why is that beneficial?
2. This, imo, fits pretty squarely into extreme libertarian technobabble
3. It's just not even true. Any moderately-size government with the interest to do so could quash any crytptocurrency it wanted with relatively little effort. Ignoring the most obvious and simple attack vectors (like regulating exchanges into oblivion, flatly criminalizing its use, etc.), obtaining enough compute power to execute a 51% attack is relative chump-change for a medium-large-ish government. Especially if you consider multiple governments might cooperate and work together on such a project.

3rd, you know what the #1 app in El Salvador is right now?  It's a remittance app, run on Bitcoin (https://strike.me/) .  Instead of paying 20% to Western Union, the receiver gets 99+% (not sure the exact number, but higher than 99%).

Cool. So like my oatmeal house idea, it's arguably useful as a better "bank" option than the banks in one of the worst-banked countries on the planet. Great.

Maybe have another read of this:
To those that would discount its value due to being mostly unseizable, I would again strongly suggest that you search for Alex Gladstein's commentary, starting with the following: https://bitcoinmagazine.com/culture/check-your-financial-privilege. From the article:

"The critics cited above are all wealthy citizens of advanced economies, where they benefit from liberal democracy, property rights, free speech, a functioning legal system and relatively stable reserve currencies like the dollar or pound.

In reality, only 13% of our planet’s population is born into the dollar, euro, Japanese yen, British pound, Australian dollar, Canadian dollar or Swiss Franc. The other 87% are born into autocracy or considerably less trustworthy currencies. 4.3 billion people live under authoritarianism, and 1.2 billion people live under double- or triple-digit inflation.

Critics in the dollar bubble miss the bigger global picture: that anyone with access to the internet can now participate in Bitcoin, a new money system with equal rules for all participants, running on a network that does not censor or discriminate, used by individuals who do not need to show a passport or an ID and held by citizens in a way that is hard to confiscate and impossible to debase."

I just don't even know where to begin on this.
- Us critics living in wealthy advanced economies are responding to proponents in wealthy advanced economies telling us about the greatest invention in mankind revolutionizing banking, and we can all get moon lambos if we just invest some money today!
- If it's useful in some place, great. It doesn't make it particularly good for anything else. It also doesn't mean it's an optimal solution in those circumstances—just better than absolute garbage.
- Citing things progressives usually care about (e.g., the global poor), while regurgitating Hayek economic nonsense that have historically only made those problems worse is a pretty funny strategy. This is, as I've stated several times now, just more Ron Swanson-esque über-libertarian silliness. To make matters worse, Bitcoin (et al) have a colossal carbon footprint—something that asymmetrically affects the very global poor crypto-enthusiasts like to exploit for cheap (and incorrect) talking points.
- How many oppressed people have reliable connections to the internet? And what can they do with this internet money when they need to use it? How?
- And once again, censorship, debase, confiscation.... all easily doable by any competent government with a motivation to do so.

Bitcoin is not intuitive, and takes a while to have it sink it and the light bulb go off.

For the detractors, I'm guessing there are large gaps in your knowledge in how it works.  I'd recommend taking this free course.
https://learn.saylor.org/course/view.php?id=468

If you still hate it at that point, god bless.  But at least you will have a full understanding of it.

Baaahahahahaha. This is another lovely cultish talking point. "You're just too stupid to understand the new magic. It's very sophisticated, and if you just were able to understand, believe me—you'd recognize how great it is!" This appeals to a certain class of human, in the same way most MLM's do. "You're too smart to work a 9-5! Be your own boss, and get out of corporate American greed!".

FWIW, I have a Computer Science degree from a reasonably respectable university I won't mention here. I have been a professional software engineer for 15 years. I have written my own little blockchain (back in 2011). I understand this better than your average grifter. I don't even know any experienced software engineers that have positive opinions of cryptocurrencies or blockchain in general. The hype is undue.
« Last Edit: June 01, 2021, 10:58:48 AM by the_gastropod »

StashingAway

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Re: Bitcoin is funny money
« Reply #744 on: June 01, 2021, 10:46:58 AM »
Bitcoin is not intuitive, and takes a while to have it sink it and the light bulb go off.

For the detractors, I'm guessing there are large gaps in your knowledge in how it works.  I'd recommend taking this free course.
https://learn.saylor.org/course/view.php?id=468

If you still hate it at that point, god bless.  But at least you will have a full understanding of it.

I know how Bitcoin works, both in theory and in practice. Not only that, I actually even have a personal wallet with BTC and ETH as well (I have even bought stuff with it in the past).

Perhaps the error is in assuming that because I don't agree with you that I don't understand it. Perhaps entertain the idea that I indeed do understand it an maybe you are missing something that I see. I'm not saying I'm absolutely correct; I'm suggesting that you haven't given that option a genuine chance .

I want to re-iterate that this is only a suggestion based on my perception of your responses. It doesn't appear that we have equal knowledge of each others viewpoints. Said another way: I don't think that you could clearly state my position as well as I could state yours.


the_gastropod

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Re: Bitcoin is funny money
« Reply #745 on: June 01, 2021, 10:51:00 AM »
Not that it uses math so it must be good.  But, it uses math to verify with 100% certainty what has happened, and what will happen with the monetary policy, and that certainty is good.

This is untrue. You cannot know what will happen. There is no mandatory money policy. Bitcoin is ultimately a computer program. It can be changed via consensus or by a 51% attack. Or by future technologies (e.g., quantum machines, if they ever really come to fruition).

Also a slight nitpick re: "100% what has happened". That's not true either. The whole "proof of X" thing is used to *define* what happened, not necessarily verify what happened. The first one to solve the silly math puzzle ultimately gets to decide what happened, given a double-spending instance, for example.

SuperSecretName

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Re: Bitcoin is funny money
« Reply #746 on: June 01, 2021, 10:57:53 AM »
StashingAway:  I've lost track of who said what.  If you fully understand it, great.  I still think most people don't, e.g. MCSDfRRU (below)

Mr. Computer Science Degree from a Reasonably Respectable University:
You changed the goal posts.  You said: "There's not been a single articulation of a single concrete benefit of using cryptocurrency (beyond some deeeeeply hand-wavy extreme libertarian technobabble)."  I gave you one, then you said "Cool. So like my oatmeal house idea, it's arguably useful as a better "bank" option than the banks in one of the worst-banked countries on the planet. Great."
I met your criteria.


SuperSecretName

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Re: Bitcoin is funny money
« Reply #747 on: June 01, 2021, 11:05:47 AM »
This is untrue. You cannot know what will happen. There is no mandatory money policy. Bitcoin is ultimately a computer program. It can be changed via consensus or by a 51% attack.
There is a mandatory money policy.  If it changes in the future, we can re-evaluate.  But until that happens, the future monetary policy is known with 100% certainty.

See, this is what I mean by not understanding bitcoin.  A 51% attack can't change the policy.  It can do two things
1 - allow double-spending of their own coins only, not anybody else's
2 - censor transactions by not including them in blocks.  Old blocks would be unchanged.

That's it.

the_gastropod

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Re: Bitcoin is funny money
« Reply #748 on: June 01, 2021, 11:07:13 AM »
If it changes in the future, we can re-evaluate.  [...] future monetary policy is known with 100% certainty.

Homie... Come on.

SuperSecretName

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Re: Bitcoin is funny money
« Reply #749 on: June 01, 2021, 11:13:48 AM »
If it changes in the future, we can re-evaluate.  [...] future monetary policy is known with 100% certainty.

Homie... Come on.
broseph.  If you want to talk about how things are, great.  Debating a future monetary policy change that's invalidates bitcoin's core value proposition, is so far down the list.
https://en.wikipedia.org/wiki/Reductio_ad_absurdum

 

Wow, a phone plan for fifteen bucks!