Author Topic: What do you think of adding a low% of crypto allocation  (Read 80501 times)

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #900 on: February 02, 2022, 05:00:04 PM »
No, I stand by my statement that Bitcoin, itself, is fraud. And that it is, for all intents-and-purposes, a Ponzi scheme. I don't believe anyone even responded to my—I think—fairly reasoned arguments from this previous post that classify it as such.

That's because your response wasn't well reasoned. 1) You move the goalposts on what the definition of a ponzi is and in the same sentence as saying that the definition of a ponzi scheme doesn't matter you turn around and say that "in layman's terms" it fits. 2) You then outline those terms as being the reason why bitcoin fits the bill of a ponzi:

Quote
1. People invest into it because they expect large profits
2. That expectation is sustained by such profits being paid to those who choose to cash out—and are very vocal about this
3. However, there is no external source of revenue for those payoffs
4. Instead, the payoffs come entirely from new investment money
5. Meanwhile, the operators take away a large portion of this money


There are several problems with this. It isn't people's expectations that determine the fraud, it is the promises made that do. Bitcoin makes no promises of returns. It is merely software with no authority. If it were people's expectations that determined what is and isn't fraud, then fraud would exist nearly everywhere we look. People have the most absurd expectations with just about everything in life (jobs, income, education, elections, investments, goods, services, etc). If someone buys a new car and expects it to fly, but the manufacturer never made any promises that the car would or could fly, does that mean there was fraud? Of course not. Now, if the manufacturer promised that it would fly and it indeed does not, then that is fraud. That's the big difference here.

You also fail to understand that bitcoin trades that take place always have a buyer and a seller and neither side's cost basis is guaranteed. A seller who is selling to a buyer could very well have losses from their cost basis with said sale and that buyer is setting a cost basis for themselves that is also not guaranteed. The fact that a seller could be selling for a loss and setting up a new buyer in position for future gains further disproves your claims of a ponzi. There are many instances of people who owned bitcoin back in 2013 and lost money on bitcoin with later buyers coming along in 2016 whose bitcoin appreciated greatly for them. Your statement of "operators take away a large portion of this money" also holds no merit (I explained this in another post already).

Ok, this is an important thing to clarify:

1. It stands that the VAST majority of people who own/use Bitcoin are doing so for speculative purposes
2. It also stands that the things you are describing are, in fact, illegal. Often times, law is very immoral. And in these cases, this is a good use-case. But it's important to acknowledge what's happening here—you're advocating for tools for bypassing the law.

What I challenge of you is to determine how any of what you said above against bitcoin so far doesn't also apply to something like gold. Please do so. Only an extremely small percentage of gold (less than 3% of above ground stock) is actually used for utility (electronics, jewelry, etc). People love to gamble and speculate on things. It is human nature. The derivatives market (ie, gambling) dwarfs every market of the true underlying no matter where you look. Estimates have the derivatives market at over $1 quadrillion. That is almost purely speculatively driven which means that the underlying spot markets are dwarfed in comparison. So yes, speculation in bitcoin is a key driver of its price upward, but its utility that people around the world are embracing is what drives its floor price continually upward as they're the true buyers of last resort out of necessity. The percentage doesn't matter. The fact remains that bitcoin's utility is providing for millions around the world.

As far as legality, I agree, legality doesn't mean morality. But none of what you stated changes anything. Bitcoin can and will be used for good, regardless of its legal status. That is its utility as a monetary good. And yes, I am indeed advocating for something that will help humans pursue individual freedom from tyranny, even if that means escaping unjust laws.


Oh, please. Firstly: the average crypto investor is a 38 year old white man who makes $111k/year. 74% of crypto investors are men. 71% are white. Source: https://cheddar.com/media/crypto-investor-white-male-survey-demographic-change

What absolutely drives me nuts about this type of response, is it's such obvious bullshit. Crypto enthusiasts only/ care about "the unbanked" or fighting authoritarianism when they can use it as a cheap talking point to pump crypto. Bitcoin was not designed from first-principles to fix these things. It's been post-hoc rationalized as a great solution for everything from venue ticketing to fixing iced tea, to solving inequality and poverty in a cynical attempt to reverse-robinhood steal from these poor people.

Look at the El Salvador situation. Crypto zealots hate authoritarians. Unless they also help shill crypto. Bukele is now like a demi-god amongst bitcoiners. They cheer him on as he day-trades with public funds and hires known fraudsters to head up volcano bonds or bitcoin beach events.

Yes. We are generally a fortunate bunch here. There are lots of people with lots of terrible and difficult-to-solve problems in the world. It is the height of arrogance to think this thing you just so happen to profit from increased adoption of, is the solution to those problems.

Quoting demographics from a US exchange survey (Gemini) as a means of discrediting all the good things around the world that bitcoin is achieving for people that weren't questioned in said US survey is hardly an adequate rebuttal here. Nothing you said changes the reality of all that I previously presented. Again, people love to gamble and speculation in every single market in the world dwarfs the size of the actual utility of any given spot.

All you're doing is rather than argue with me and the points I've made, you make generalizations about "crypto bros" this and "crypto bros" that. I'm not a crypto bro and my arguments are my own. If you care to genuinely debate me, then debate my arguments on their merit as I have done yours. I could care less what "crypto bros" are saying in regards to Bukele. He is a dictator like the rest of them that has sought power by any means necessary. But again, that is all irrelevant to all that I've said so far and is not in any way a meaningful rebuttal. Again, none of that changes the reality of bitcoin's utility and the good that it is providing and will continue to provide for people.
« Last Edit: February 02, 2022, 05:53:48 PM by lifeanon269 »

Blender Bender

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Re: What do you think of adding a low% of crypto allocation
« Reply #901 on: February 02, 2022, 06:52:14 PM »
@lifeanon269
I don’t get why you are wasting your time on convincing MMM forum users that crypto is good. You know what owner of this site thinks about it. Why don't find a better forum that is big on crypto instead? Bro to Bro talk, could be actually nice.

I don’t see ARK holders doing such. The are not pumping ARK here like you.

It must be something strange happening to crypto holders. Once they get crypto they become strange. Like a cult members.  Jehovah witness like. I sense some deep insecurity.

Can you just HODL and move on? You are welcome to think about us that we are losers and don’t understand. But don’t say these to us, think privately and be happy.

Why we have to agree with your crypto investments? The answer seems simple. Bros have to pump because this makes more chances on their gamble. Deep inside they have insecurities about crypto. If you really believe in crypto, why do that? I happened to e.g. think that SOXX has good long term outlook, but i don't force everyone around me to get it. It is all so weird.
« Last Edit: February 02, 2022, 07:07:01 PM by ArnoldK »

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #902 on: February 02, 2022, 08:01:42 PM »
@lifeanon269
I don’t get why you are wasting your time on convincing MMM forum users that crypto is good. You know what owner of this site thinks about it. Why don't find a better forum that is big on crypto instead? Bro to Bro talk, could be actually nice.

I would argue that any time spent on a forum is of equal waste/merit, whether it is between agreements or arguments is irrelevant. As I mentioned in a previous post and as you can see from my history, I have dropped off from the forum for a while.

Haven't frequented these forums much lately and figured I would drop in

I also do have frequent discussion with those that work with bitcoin as I do quite a bit of development on several bitcoin and non-bitcoin projects. However, I don't think it is appropriate for anyone to quarantine themselves off into echo chambers as I don't think that does anyone a bit of good. I do find merit in having frank discussions on topics I am interested in even if it is not among those I agree with. Hearing and understanding opposing views helps me ground my own views. As you can see from my post history, I never resort to ad hominem arguments and always try to stick to debating the subject at hand and keeping things civil.

I don’t see ARK holders doing such. The are not pumping ARK here like you.

I beg to differ. For a community that prides itself low risk investing, there are quite a bit of posts in these investment threads related to investing in any given company, regardless of how questionable or the risk entailed.

Can you just HODL and move on? You are welcome to think about us that we are losers and don’t understand. But don’t say these to us, think privately and be happy.

As I said, I don't think anyone here are losers. Most people here are very intelligent and successful people. I've gravitated toward these forums because I find most people here like minded with myself. I am an extremely frugal person saving over 50% of my income and I wish people outside these forums practiced this lifestyle. In fact, it is one of the reasons why I've also gravitated toward bitcoin seeing how it is in direct contrast to our expansive monetary policies that push consumption and consumerist lifestyles above all else.

People are free to believe what they want. No one is forced to use bitcoin and I would never want bitcoin forced on anyone. However, I'm free to have debate here and so is anyone else. Move on? The same could be said of anyone here, regardless of whether they're arguing for or against. Telling someone to move on just because they hold a different point of view isn't productive. If you take offense to anything I say or are annoying by any of this conversation, then perhaps it is you that should step away for your own sake?

Why we have to agree with your crypto investments? The answer seems simple. Bros have to pump because this makes more chances on their gamble. Deep inside they have insecurities about crypto. If you really believe in crypto, why do that? I happened to e.g. think that SOXX has good long term outlook, but i don't force everyone around me to get it. It is all so weird.

As I said, that's the beauty of a free market; you don't need to agree. If you've read my posts, you'll see that I hold a lot of agreement with many here with regard to there being massive amounts of fraud in the cryptocurrency space. I am merely arguing base on the fact that there is a big difference between what a majority of that industry is doing and bitcoin. I often simply chime in here because I often see things said in regards to bitcoin that is blatantly false. There are a lot of things that are valid critiques of bitcoin and allowing myself to be exposed to those critiques provides me a better education on the subject than if I were to just keep to an echo-chamber. If only everyone applied that same concept to the things we each partake in.

Blender Bender

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Re: What do you think of adding a low% of crypto allocation
« Reply #903 on: February 02, 2022, 08:09:07 PM »
@lifeanon269
You are right, i guess i responded poorly. Sorry for that, trying to shortcut open discussions.
I think that the best for me would be not post on this thread anymore, will try. Just makes me feel crazy following it.

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #904 on: February 02, 2022, 08:25:32 PM »
@lifeanon269
You are right, i guess i responded poorly. Sorry for that, trying to shortcut open discussions.
I think that the best for me would be not post on this thread anymore, will try. Just makes me feel crazy following it.

No hard feelings. I totally get it. I can only debate the same circular debates for so long as well, hence my drop of for quite a period of time.

Juan Ponce de León

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Re: What do you think of adding a low% of crypto allocation
« Reply #905 on: February 02, 2022, 08:34:12 PM »
ArnoldK is right, it is absolutely pointless to try and discuss crypto as a topic on this forum.  I completely agree with him.

Telecaster

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Re: What do you think of adding a low% of crypto allocation
« Reply #906 on: February 02, 2022, 11:25:27 PM »
No, I stand by my statement that Bitcoin, itself, is fraud. And that it is, for all intents-and-purposes, a Ponzi scheme. I don't believe anyone even responded to my—I think—fairly reasoned arguments from this previous post that classify it as such.

You were responding to me, and I didn't have anything to add that I hadn't previously said to I didn't respond back.    But since you asked...Your position seemed to be (please correct me if I'm wrong) that Bitcoin's price increases are dependent upon more and more money being pumped into the system.  I agree with that 100%.

That part I disagree with what  you're saying (again, please correct me if I'm wrong) that because miners collect a fee as money enters and leaves the system, that makes it a fraud.  However, I don't see the fraud.  Unlike Bernie Madoff who handed you a fake balance statement, everyone who buys Bitcoin gets exactly what they were expecting.  Everyone knows, or should know, the miners charge a transaction fee.   None of that is concealed.   

There is a legal term caveat emptor "let the buyer beware."   It is the buyer's responsibility to understand what she is buying.  If the buyer gets exactly what she was expecting, and nothing is concealed, it is hard to see an instance of fraud.

Because there is no deception, there cannot be fraud, and because there is no fraud, it cannot be a Ponzi scheme.  Therefore, Bitcoin is much better explained as a speculative bubble.   Similar to other speculative bubbles like the South Sea Bubble or the US housing market in the 2000s. 

Obviously some people disagree with me and think something is fraudulent, but no one has ever, not once, said what the deception actually is.

So I think a more fruitful avenue to explore are the use cases of Bitcoin.  Does it function as a currency or as a store of value?   And does it do those things as well as alternatives?  Those are the real questions. 

AlexK

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Re: What do you think of adding a low% of crypto allocation
« Reply #907 on: February 03, 2022, 12:41:29 AM »
I've really been enjoying this thread. Thanks for the great read. It's a fascinating topic and there are smart arguments and people on both sides. It appears that everyone agrees cryptocurrencies are having a speculative bubble (regardless if that was the intent). If (some say when) the bubble pops a lot of people will be poorer and a few will be richer. Both sides agree there are good aspects like helping those with unstable currencies and governments and bad aspects like contribution to climate change and pollution.

Because the title of the thread asks what we think of adding a low% of crypto allocation: I am of the opinion that crypto is a fad that will eventually go out of favor, closer to beanie babies than the new gold, and because of that I'm staying out. I don't want to get caught up in the collapse and I wouldn't want to make gains at the expense of other's misfortune even if I could time it right. That and the environmental reasons are enough to keep it out of my investment portfolio. Besides, there are plenty of other things to invest in that are clearly not speculative bubbles like companies that make food or productivity increasing machines so why take the risk? Of course if I'm wrong I will happily transact in Shiba Inu just like everyone else when it becomes our next world reserve currency. I make no predictions about when the cryptocurrency fad will end therefore I cannot be proven wrong.

vand

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Re: What do you think of adding a low% of crypto allocation
« Reply #908 on: February 03, 2022, 06:54:47 AM »
Its worth noting that Zuckerberg has decided to drop his FB/Meta crypto project.

Is crypto so cool now that even the likes of Zuckerberg doesn't "get it?"

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #909 on: February 03, 2022, 08:30:39 AM »
You were responding to me, and I didn't have anything to add that I hadn't previously said to I didn't respond back.    But since you asked...

You didn't owe a response :) I was just trying to respond to the claim that my argument had been debunked when no-one had even responded to it. Regardless, thanks for the response!

Your position seemed to be (please correct me if I'm wrong) that Bitcoin's price increases are dependent upon more and more money being pumped into the system.  I agree with that 100%.

Yup! So far so good...

That part I disagree with what  you're saying (again, please correct me if I'm wrong) that because miners collect a fee as money enters and leaves the system, that makes it a fraud.  However, I don't see the fraud.  Unlike Bernie Madoff who handed you a fake balance statement, everyone who buys Bitcoin gets exactly what they were expecting.  Everyone knows, or should know, the miners charge a transaction fee.   None of that is concealed.   

You're close to reiterating my point, but my point has a little bit more nuance that I'd like to hopefully more clearly articulate:
1. I'm not super-interested in talking about the legal definitions of a Ponzi. As I've stated, law is necessarily reactive. So, much law around Ponzi schemes is, understandably, focused on the attributes of past Ponzis. What I'm trying to suggest is that for all intents and purposes, Bitcoin has the same effects as a Ponzi. The system operates in the same manner.
2. There is not one canonical definition of a Ponzi scheme. Even from a legal standpoint, different jurisdictions have different requirements for determining whether something is or is not a Ponzi. That a lie was told is not a requirement for prosecution in many jurisdictions. Even the "promise" thing you've mentioned before, isn't required for prosecution in many jurisdictions. Madoff made no promises, though he did certainly lie.
3. The part that is "concealed" is through technical obfuscation. Crypto enthusiasts often like to talk about "transparency" and that the code is "open-source", likely having never read a line of the source code. There is a reason things like Bitconnect (an actual prosecuted Ponzi scheme) are able to operate so readily in this world—most people involved are already clueless about how the scheme works, they just see the number going up, and know that something sophisticated and probably legitimate must be happening behind the scenes. I think it's disingenuous to suggest the majority of crypto enthusiasts understand that this is a negative-sum-game they're playing. Most would be outraged at the suggestion that they're gambling. They have been misled.
4. In addition to the tech-obfuscation, you have crypto-celebrities and famous investors constantly—based on literally nothing—predicting wildly optimistic future prices of Bitcoins (https://www.bitcoinprice.com/predictions/). You also have—as you've seen in this thread even very recently—wild claims about how crypto will one day "bank the unbanked", become a global currency, free citizens of repressive regimes, end corruption, etc. Ethereum enthusiasts argue that "smart contracts" will one day replace the need for lawyers and legal systems. Code is law! Many crypto companies make outrageous claims about partnerships with big companies like Samsung or Microsoft, to appear more legitimate (https://www.pymnts.com/cryptocurrency/2018/samsung-coppay-partnership-rumor-startup/) The point is, even if all of these unlikely predictions or lies manifested themselves, none of them would result in a source of revenue for people holding crypto. There may be more transaction fees to go to miners/stakers, but the "investors" simply holding the coins would not benefit, and I posit: most holders of these coins do not understand this point. They, almost by definition, do not understand what a good investment is. They don't understand why it's any different than gold, stocks, bonds, etc. They do not understand why investing in a negative-sum-game is a bad idea. Because they've been repeatedly fed misinformation.

There is a legal term caveat emptor "let the buyer beware."   It is the buyer's responsibility to understand what she is buying.  If the buyer gets exactly what she was expecting, and nothing is concealed, it is hard to see an instance of fraud.

Because there is no deception, there cannot be fraud, and because there is no fraud, it cannot be a Ponzi scheme.  Therefore, Bitcoin is much better explained as a speculative bubble.   Similar to other speculative bubbles like the South Sea Bubble or the US housing market in the 2000s. 

Obviously some people disagree with me and think something is fraudulent, but no one has ever, not once, said what the deception actually is.

So I think a more fruitful avenue to explore are the use cases of Bitcoin.  Does it function as a currency or as a store of value?   And does it do those things as well as alternatives?  Those are the real questions.

I think I addressed this above. To reiterate, though: I'm arguing that there is, indeed deception happening. The huge majority of HODLers do not understand the game they're playing. Most would aggressively disagree with your assessment that they're participating in a negative-sum-game. They do not understand—not because they're stupid—but because they've been misinformed by people with a profit-motive.

Edited to add: I don't really want to appeal-to-authority here, but I do want to show that this isn't some completely unfair or off-the-hinges take.

- US economist Nouriel Roubini calls Bitcoin a Ponzi scheme: https://www.coindesk.com/markets/2014/03/10/economist-nouriel-roubini-slams-bitcoin-calls-it-a-ponzi-game/
- The World Bank calls it a Ponzi: https://www.coindesk.com/markets/2014/07/17/world-bank-report-bitcoin-is-a-naturally-occurring-ponzi/
- Investment analyst David Webb calls it a "Distributed Ponzi": https://www.cfoinnovation.com/risk-management/webb-bitcoin-first-decentralized-ponzi-scheme-for-betting-others-greater-stupidity
- Jim Yong Kim of the World Bank also calls it a Ponzi: https://www.cfoinnovation.com/management/world-bank-compares-bitcoin-to-ponzi-scheme-while-goldman-warns-a-crash-to-zero
- Nassim Taleb calls Bitcoin an "Open Ponzi scheme": https://www.cnbc.com/2021/04/23/bitcoin-a-gimmick-and-resembles-a-ponzi-scheme-black-swan-author-.html
« Last Edit: February 03, 2022, 09:26:13 AM by the_gastropod »

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #910 on: February 03, 2022, 10:05:57 AM »
There is not one canonical definition of a Ponzi scheme. Even from a legal standpoint, different jurisdictions have different requirements for determining whether something is or is not a Ponzi. That a lie was told is not a requirement for prosecution in many jurisdictions. Even the "promise" thing you've mentioned before, isn't required for prosecution in many jurisdictions. Madoff made no promises, though he did certainly lie.

The point Telecaster was making about Madoff wasn't that he necessarily made promises, but he did deceive and lie. He literally wrote fake statements made up of fake baskets of investments that he sent to clients. That is fraud. There is no such thing taking place with bitcoin as bitcoin has no owner or authority governing it. That doesn't mean there aren't individuals out there making bogus promises about its potential, but that does not equate fraud because they're not in charge of that potential. It is no different than a gold bug making grandious claims about gold's future investment potential. Anyone is free to educate themselves about both gold and bitcoin and decide for themselves.

3. The part that is "concealed" is through technical obfuscation. Crypto enthusiasts often like to talk about "transparency" and that the code is "open-source", likely having never read a line of the source code. There is a reason things like Bitconnect (an actual prosecuted Ponzi scheme) are able to operate so readily in this world—most people involved are already clueless about how the scheme works, they just see the number going up, and know that something sophisticated and probably legitimate must be happening behind the scenes. I think it's disingenuous to suggest the majority of crypto enthusiasts understand that this is a negative-sum-game they're playing. Most would be outraged at the suggestion that they're gambling. They have been misled.

I wholeheartedly disagree here and this also does not equate to fraud. Just because someone doesn't understand something, when they have the full potential to do so, doesn't mean there is fraud. That is not deception. It might be laziness on behalf of the investor to not do more research, sure. But that is not fraud. Again, it goes back to my previous point about how faulty expectations does not equate to fraud. Just because someone might have incorrect expectations set for something does not mean fraud took place. I completely agree that there is a lot of fraud in the cryptocurrency space, which is why, as I previously said, I think it is important to differentiate between bitcoin and the rest of the space.

You also have—as you've seen in this thread even very recently—wild claims about how crypto will one day "bank the unbanked", become a global currency, free citizens of repressive regimes, end corruption, etc.

As I've shown, I have not made "claims" of such, I was simply stating what was actually happening around the world. The examples I gave are real-world examples and I have no reason to believe that these examples of bitcoin helping people in these situations are suddenly going to stop in our world. Do you? Don't take my word for it though:

https://www.nytimes.com/2019/02/23/opinion/sunday/venezuela-bitcoin-inflation-cryptocurrencies.html
https://www.coindesk.com/markets/2019/04/24/russian-opposition-leader-raises-3-million-in-bitcoin-donations/
https://qz.com/africa/1922466/how-bitcoin-powered-nigerias-endsars-protests/
https://www.coindesk.com/policy/2020/09/09/belarus-nonprofit-helps-protestors-with-bitcoin-grants/
https://www.coindesk.com/markets/2018/09/18/palestinians-are-using-bitcoin-to-transact-across-borders-amid-conflict/

I could go on more...

Ethereum enthusiasts argue that "smart contracts" will one day replace the need for lawyers and legal systems. Code is law! Many crypto companies make outrageous claims about partnerships with big companies like Samsung or Microsoft, to appear more legitimate (https://www.pymnts.com/cryptocurrency/2018/samsung-coppay-partnership-rumor-startup/) The point is, even if all of these unlikely predictions came true, none of them would result in a source of revenue for people holding crypto. There may be more transaction fees to go to miners/stakers, but the "investors" simply holding the coins would not benefit, and I posit: most holders of these coins do not understand this point. They, almost by definition, do not understand what a good investment is.

I agree completely that there are overly-hyped claims about cryptocurrencies and "blockchain tech". At the end of the day, a blockchain (which is just a type of database) is only good for removing trust in a decentralized fashion. So the idea that it could possibly revolutionize things like the shipping industry, lending, legal systems, voting, etc. are all bullshit because all those things inherently rely upon trust. You're not going to lend money to someone unless you trust them and you perform proper credit risk. A blockchain database isn't going to do a bit of good in a shipping industry since your business would be in complete control of the database and hence would have no need for the benefits such a distributed DB would provide. I fully agree that these claims about benefits from a blockchain in any of these scenarios and more are anything but hype. That is why I think it is so important to differentiate between bitcoin and other cryptocurrencies. Bitcoin remains as just being focus on the one area that a blockchain can actually provide a benefit, maintaining decentralization in a monetary system.

They don't understand why it's any different than gold, stocks, bonds, etc. They do not understand why investing in a negative-sum-game is a bad idea. Because they've been repeatedly fed misinformation.

But here is the thing, as I've asked now several times, you have yet to describe why you feel gold is any different.

All the critiques you've provided against bitcoin can also be said of gold. There are grandious claims said by gold bugs all the time. Gold miners don't pay for their expenses (fuel, equipment, property, etc) with gold. So they're always taking gold out of the system. Only an extremely small percentage of the gold that has been mined is used for things like jewelry and electronics. At the end of the day, it doesn't matter if only a little bit of it is used for utility. Just like bitcoin, it is that small portion of utility that it provides to society that drives its overall value. So, as with every single asset on earth, speculation will flood into the market. Like I previously said, speculation dwarfs the size of every single spot market on earth. At the end of the day, people love to gamble. That doesn't mean there is fraud at play.

I think I addressed this above. To reiterate, though: I'm arguing that there is, indeed deception happening. The huge majority of HODLers do not understand the game they're playing. Most would aggressively disagree with your assessment that they're participating in a negative-sum-game. They do not understand—not because they're stupid—but because they've been misinformed by people with a profit-motive.

You're confusing fraud taking place at an individual level with what is fraud at a systemic level. Bitcoin is what it is. Akin to gold in that respect. Anyone is free to do their research about what gold and bitcoin are and aren't. Those two things are not frauds. You're free to learn about them as you wish. I agree there might be fraud at an individual level where someone is promising something grandious to someone else just to get them to invest into something without being informed about where their money is actually going. But don't mistake fraud that takes place at the individual level with fraud at a systemic level.

Your claims about "technical obfuscation" fail here. People don't need to understand how the internet works in order to understand it at its basic level and understand the benefits that could come from using such a technology. The same is true of bitcoin. While there is so much to learn about it at a technical level, that does not mean you need to be extremely tech savvy to be able to use it and understand the potential benefits that could come from using such a tech. This only gets more and more true as the technology matures as evidenced with both the internet and bitcoin.

- US economist Nouriel Roubini calls Bitcoin a Ponzi scheme: https://www.coindesk.com/markets/2014/03/10/economist-nouriel-roubini-slams-bitcoin-calls-it-a-ponzi-game/
- The World Bank calls it a Ponzi: https://www.coindesk.com/markets/2014/07/17/world-bank-report-bitcoin-is-a-naturally-occurring-ponzi/
- Investment analyst David Webb calls it a "Distributed Ponzi": https://www.cfoinnovation.com/risk-management/webb-bitcoin-first-decentralized-ponzi-scheme-for-betting-others-greater-stupidity
- Jim Yong Kim of the World Bank also calls it a Ponzi: https://www.cfoinnovation.com/management/world-bank-compares-bitcoin-to-ponzi-scheme-while-goldman-warns-a-crash-to-zero
- Nassim Taleb calls Bitcoin an "Open Ponzi scheme": https://www.cnbc.com/2021/04/23/bitcoin-a-gimmick-and-resembles-a-ponzi-scheme-black-swan-author-.html

BREAKING...this just in...People most threatened by bitcoin call it a ponzi scheme!...[eyeroll]

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #911 on: February 03, 2022, 10:13:11 AM »
There is not one canonical definition of a Ponzi scheme. Even from a legal standpoint, different jurisdictions have different requirements for determining whether something is or is not a Ponzi. That a lie was told is not a requirement for prosecution in many jurisdictions. Even the "promise" thing you've mentioned before, isn't required for prosecution in many jurisdictions. Madoff made no promises, though he did certainly lie.

The point Telecaster was making about Madoff wasn't that he necessarily made promises, but he did deceive and lie. He literally wrote fake statements made up of fake baskets of investments that he sent to clients. That is fraud. There is no such thing taking place with bitcoin as bitcoin has no owner or authority governing it. That doesn't mean there aren't individuals out there making bogus promises about its potential, but that does not equate fraud because they're not in charge of that potential. It is no different than a gold bug making grandious claims about gold's future investment potential. Anyone is free to educate themselves about both gold and bitcoin and decide for themselves.

Bitcoin is not a coin, and has yet to have functioned as a currency.  Deception and lies would appear to be built into the very name.

By the same 'anyone is free to educate themselves about gold and bitcoin and decide" token . . . was the same not true for Madoff's investments?  He was offering 11% guaranteed returns.  That's simply not possible to guarantee - and anyone who was educated about investments should have spotted that.

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #912 on: February 03, 2022, 12:03:17 PM »
Bitcoin is not a coin, and has yet to have functioned as a currency.  Deception and lies would appear to be built into the very name.

I beg to differ about it being used as a currency.

By the same 'anyone is free to educate themselves about gold and bitcoin and decide" token . . . was the same not true for Madoff's investments?  He was offering 11% guaranteed returns.  That's simply not possible to guarantee - and anyone who was educated about investments should have spotted that.

I think you answered your own question. No, the same was absolutely not true for Madoff's investments. Much of Madoff's scheme was kept private and he was creating fake statements as to the investments that were being made while the truth behind the scenes was very different. Many people suspected that his numbers were fake and impossible, but it wasn't until the entire thing collapsed that it became apparent. That's the thing, these things either need an investigation from jurisdictional authority to peel back what is hidden from public eye or they collapse when everything fails. But the big difference is the openness with which information is freely shared. That's the part that you're missing here. Yes, "guaranteed" returns of any kind should be an immediate red flag, but that still doesn't change the massive difference between the blatant fraud of Madoff where a scheme was hidden from view and bitcoin. It is amazing that this still needs to be said here with such circular arguments. This is extremely different from bitcoin where you're free to educate yourself about what it is and isn't and the information is freely available and open to anyone on the internet. You have no argument on these grounds whatsoever.

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Re: What do you think of adding a low% of crypto allocation
« Reply #913 on: February 03, 2022, 12:25:14 PM »
So celebrities paid to shill crypto isn't dishonest or misleading at all?

https://slate.com/technology/2021/10/ben-mckenzie-crypto-celebrities-kardashian-brady-lohan.html

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #914 on: February 03, 2022, 12:27:16 PM »
The point Telecaster was making about Madoff wasn't that he necessarily made promises, but he did deceive and lie. He literally wrote fake statements made up of fake baskets of investments that he sent to clients. That is fraud. There is no such thing taking place with bitcoin as bitcoin has no owner or authority governing it. That doesn't mean there aren't individuals out there making bogus promises about its potential, but that does not equate fraud because they're not in charge of that potential. It is no different than a gold bug making grandious claims about gold's future investment potential. Anyone is free to educate themselves about both gold and bitcoin and decide for themselves.

The reason I chose to respond to Telecaster instead of you is because I felt they both were arguing in good faith, and clearly understood my arguments. While you might be arguing in good faith—it's still not clear—you absolutely are misinterpreting my responses pretty badly. I'll try once more to clear these misunderstandings up, but I'm not feeling like the effort put in thus far has been mutually respectful.

Now. I completely understood Telecasters point. Telecaster mentioned, in previous posts, that a promise of a return is a necessary component of a Ponzi. While this is, indeed, a common attribute—and a sometimes a necessary one in some jurisdictions—it is one attribute that Bernie Madoff's Ponzi failed to include. My point was simply: there are different legal definitions of Ponzis. Some of the biggest Ponzis of the past do not include all of the definitions from all legal jurisdictions. Failing to meet all the criteria of all legal jurisdictions is not sufficient to conclude a system is not a Ponzi.

I wholeheartedly disagree here and this also does not equate to fraud. Just because someone doesn't understand something, when they have the full potential to do so, doesn't mean there is fraud. That is not deception. It might be laziness on behalf of the investor to not do more research, sure. But that is not fraud. Again, it goes back to my previous point about how faulty expectations does not equate to fraud. Just because someone might have incorrect expectations set for something does not mean fraud took place. I completely agree that there is a lot of fraud in the cryptocurrency space, which is why, as I previously said, I think it is important to differentiate between bitcoin and the rest of the space.

This isn't necessarily true. If you sign a Terms of Service that is, for example, usurious, there are laws that protect you from that—even though you were "too lazy" to understand or read the terms. This happens all the times with businesses Terms of Service—many of the terms are often not legally enforceable.

I'd argue: the proof's in the pudding, as they say. Fraud runs so rampant, and the lion's share of Bitcoiners are completely clueless about how the thing they're invested in actually functions. Again, for proof, you needn't do much beyond read through this thread. Either Bitcoiners are colossally lazy and stupid, as a group, or they've been deceived. Who's doing the deceiving? Well, certainly a bunch of people I've already mentioned. But also the system, itself, is deceiving. That puts it on shaky legal ground for prosecution, I understand. But as I've tried to reiterate: I'm not very interested in talking about this from a legal lens. I think the interesting discussion is whether Bitcoin uses the same mechanisms to separate fools and their money as Ponzis.

As I've shown, I have not made "claims" of such, I was simply stating what was actually happening around the world. The examples I gave are real-world examples and I have no reason to believe that these examples of bitcoin helping people in these situations are suddenly going to stop in our world. Do you? Don't take my word for it though:

https://www.nytimes.com/2019/02/23/opinion/sunday/venezuela-bitcoin-inflation-cryptocurrencies.html
https://www.coindesk.com/markets/2019/04/24/russian-opposition-leader-raises-3-million-in-bitcoin-donations/
https://qz.com/africa/1922466/how-bitcoin-powered-nigerias-endsars-protests/
https://www.coindesk.com/policy/2020/09/09/belarus-nonprofit-helps-protestors-with-bitcoin-grants/
https://www.coindesk.com/markets/2018/09/18/palestinians-are-using-bitcoin-to-transact-across-borders-amid-conflict/

I could go on more...

This is another case where my argument wasn't understood. I have no intention of arguing whether these things are happening, or if Bitcoin is capable of serving a good purpose for some people. My point is: all of this is completely irrelevant when it comes to answering: is this a good investment. It's a cynical distraction—deception.

I agree completely that there are overly-hyped claims about cryptocurrencies and "blockchain tech". At the end of the day, a blockchain (which is just a type of database) is only good for removing trust in a decentralized fashion. So the idea that it could possibly revolutionize things like the shipping industry, lending, legal systems, voting, etc. are all bullshit because all those things inherently rely upon trust. You're not going to lend money to someone unless you trust them and you perform proper credit risk. A blockchain database isn't going to do a bit of good in a shipping industry since your business would be in complete control of the database and hence would have no need for the benefits such a distributed DB would provide. I fully agree that these claims about benefits from a blockchain in any of these scenarios and more are anything but hype. That is why I think it is so important to differentiate between bitcoin and other cryptocurrencies. Bitcoin remains as just being focus on the one area that a blockchain can actually provide a benefit, maintaining decentralization in a monetary system.

Cool. We mostly agree here. I'd argue, you may have some blinders on about what "decentralized" means. You say it removes "trust", which is true. But importantly, it also removes accountability. Understanding this, I think, is key to understanding why fraud is so rampant. It's a feature, not a bug.

But here is the thing, as I've asked now several times, you have yet to describe why you feel gold is any different.

All the critiques you've provided against bitcoin can also be said of gold. There are grandious claims said by gold bugs all the time. Gold miners don't pay for their expenses (fuel, equipment, property, etc) with gold. So they're always taking gold out of the system. Only an extremely small percentage of the gold that has been mined is used for things like jewelry and electronics. At the end of the day, it doesn't matter if only a little bit of it is used for utility. Just like bitcoin, it is that small portion of utility that it provides to society that drives its overall value. So, as with every single asset on earth, speculation will flood into the market. Like I previously said, speculation dwarfs the size of every single spot market on earth. At the end of the day, people love to gamble. That doesn't mean there is fraud at play.

Hah. I actually thought to include a piece about gold in my last rant, but thought it'd be too irrelevant. Kinda glad you brought it up! Let's go! Remember in my initial post, I outlined 5 characteristics that make a Ponzi a Ponzi. They were:

1. People invest into it because they expect large profits
2. That expectation is sustained by such profits being paid to those who choose to cash out—and are very vocal about this
3. However, there is no external source of revenue for those payoffs
4. Instead, the payoffs come entirely from new investment money
5. Meanwhile, the operators take away a large portion of this money

Gold investors do not expect to turn large profits. Gold bugs are gold bugs because they want to hedge against inflation or societal collapse, or communists, or whatever. They absolutely treat it as a store of value, in the old school sense. So right off the bat, that nixes #1.

Gold HAS a source of revenue besides other speculators speculating the price higher. About 2/3 of gold production is actually used/purchased by consumers as jewelry, electronics manufacturing, etc.

Now, I'm hardly a gold bug, so feel weird "defending" gold much beyond that. It's still a very stupid investment, in my opinion. Just less stupid than Bitcoin. And it certainly doesn't meet the Ponzi rules.


You're confusing fraud taking place at an individual level with what is fraud at a systemic level. Bitcoin is what it is. Akin to gold in that respect. Anyone is free to do their research about what gold and bitcoin are and aren't. Those two things are not frauds. You're free to learn about them as you wish. I agree there might be fraud at an individual level where someone is promising something grandious to someone else just to get them to invest into something without being informed about where their money is actually going. But don't mistake fraud that takes place at the individual level with fraud at a systemic level.

It's not akin to gold, as I hope I've established above.

Your claims about "technical obfuscation" fail here. People don't need to understand how the internet works in order to understand it at its basic level and understand the benefits that could come from using such a technology. The same is true of bitcoin. While there is so much to learn about it at a technical level, that does not mean you need to be extremely tech savvy to be able to use it and understand the potential benefits that could come from using such a tech. This only gets more and more true as the technology matures as evidenced with both the internet and bitcoin.

People can freely use the Internet without investing in it (whatever that would even mean?!). This analogy does not hold up.

Regardless, I think my point was once again misunderstood. My point wasn't: one must understand the complete inner-workings of Bitcoin before investing. My point was: Bitcoin's inner-workings are cited often (see how many tech reporters claim Bitcoin mining is "solving complex math problems"—a completely ridiculous statement) almost as a symbol that there must be something happening that's producing the value. The technological complexity is used to lull people into a false sense that it must be 1. too complicated for them to understand, and 2. doing something valuable. The number goes up because something is worthwhile is happening. Arrogance, I think, compounds this, because people are too embarrassed to acknowledge they don't understand it, and feel part of an in-group by participating to show off how smart and ahead-of-the-pack they are. Blockchain is Computer Science's String Theory—a largely useless bunch of malarkey that not-all-that-bright dipshits think is "super-interesting" despite understanding virtually 0 of it.

- US economist Nouriel Roubini calls Bitcoin a Ponzi scheme: https://www.coindesk.com/markets/2014/03/10/economist-nouriel-roubini-slams-bitcoin-calls-it-a-ponzi-game/
- The World Bank calls it a Ponzi: https://www.coindesk.com/markets/2014/07/17/world-bank-report-bitcoin-is-a-naturally-occurring-ponzi/
- Investment analyst David Webb calls it a "Distributed Ponzi": https://www.cfoinnovation.com/risk-management/webb-bitcoin-first-decentralized-ponzi-scheme-for-betting-others-greater-stupidity
- Jim Yong Kim of the World Bank also calls it a Ponzi: https://www.cfoinnovation.com/management/world-bank-compares-bitcoin-to-ponzi-scheme-while-goldman-warns-a-crash-to-zero
- Nassim Taleb calls Bitcoin an "Open Ponzi scheme": https://www.cnbc.com/2021/04/23/bitcoin-a-gimmick-and-resembles-a-ponzi-scheme-black-swan-author-.html

BREAKING...this just in...People most threatened by bitcoin call it a ponzi scheme!...[eyeroll]

Y'know, to be honest, you seem offended at the implication that you're a "crypto bro", but you parrot the same really absurd arguments as crypto bros. How is Nassim Taleb—himself a former bit of crypto bro—threatened by Bitcoin? Is the World Bank actually threatened by Bitcoin? You've drank some kool-aid if that's really your perspective here.
« Last Edit: February 03, 2022, 12:58:45 PM by the_gastropod »

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #915 on: February 03, 2022, 03:11:43 PM »
While you might be arguing in good faith—it's still not clear—you absolutely are misinterpreting my responses pretty badly. I'll try once more to clear these misunderstandings up, but I'm not feeling like the effort put in thus far has been mutually respectful.

In what way have I not been respectful? I am presenting my arguments the same way you are. I am absolutely welcoming of your arguments and I genuinely request your side so I can understand where you're coming from and thus present my argument in the most concise way I can.

Now. I completely understood Telecasters point. Telecaster mentioned, in previous posts, that a promise of a return is a necessary component of a Ponzi. While this is, indeed, a common attribute—and a sometimes a necessary one in some jurisdictions—it is one attribute that Bernie Madoff's Ponzi failed to include. My point was simply: there are different legal definitions of Ponzis. Some of the biggest Ponzis of the past do not include all of the definitions from all legal jurisdictions. Failing to meet all the criteria of all legal jurisdictions is not sufficient to conclude a system is not a Ponzi.

What?! First off, that is factually not true at all. Madoff absolutely made promises of returns. Guaranteed returns in fact, as was already talked about in this very thread. While I agree that promises of returns are required for a ponzi scheme to exist, they absolutely did in Madoff's case. Like you, I don't care much about what the legal definition of a ponzi scheme is. Doesn't matter whether you go by a legal definition or just a commonly understood definition, I think you'd be hard pressed to have anyone feel that a commodity, scarce or otherwise, is a ponzi scheme. That is very much where bitcoin lies. It is an open market commodity.


This isn't necessarily true. If you sign a Terms of Service that is, for example, usurious, there are laws that protect you from that—even though you were "too lazy" to understand or read the terms. This happens all the times with businesses Terms of Service—many of the terms are often not legally enforceable.

I'd argue: the proof's in the pudding, as they say. Fraud runs so rampant, and the lion's share of Bitcoiners are completely clueless about how the thing they're invested in actually functions. Again, for proof, you needn't do much beyond read through this thread. Either Bitcoiners are colossally lazy and stupid, as a group, or they've been deceived. Who's doing the deceiving? Well, certainly a bunch of people I've already mentioned. But also the system, itself, is deceiving. That puts it on shaky legal ground for prosecution, I understand. But as I've tried to reiterate: I'm not very interested in talking about this from a legal lens. I think the interesting discussion is whether Bitcoin uses the same mechanisms to separate fools and their money as Ponzis.

You talk about me not arguing in good faith and that I am not being respectful, but in the same post you talk about how I am a "cryto-bro" and that bitcoiners are lazy and stupid and I am supposed to take that how?? I have no used name calling in any of my responses nor have I used generalizations in any derogatory way.

This is another case where my argument wasn't understood. I have no intention of arguing whether these things are happening, or if Bitcoin is capable of serving a good purpose for some people. My point is: all of this is completely irrelevant when it comes to answering: is this a good investment. It's a cynical distraction—deception.

I feel like you're being disingenuous here. Your exact words in the previous post was:
Quote
4. In addition to the tech-obfuscation, you have crypto-celebrities and famous investors constantly—based on literally nothing—predicting wildly optimistic future prices of Bitcoins (https://www.bitcoinprice.com/predictions/). You also have—as you've seen in this thread even very recently—wild claims about how crypto will one day "bank the unbanked", become a global currency, free citizens of repressive regimes, end corruption, etc.


This was in response to Telecaster rebutting your point as to whether bitcoin is fraud or not. That sentence makes claims (almost certainly directed to me) about people in this very thread making wild claims about bitcoin "one day" doing these things. My counterpoint just now was that the things I brought up in this thread were not "one day" things that I'm claiming will someday happen. They are factual events that are indeed taking place today. Regardless of whether you think they're irrelevant to your arguments that it is fraud, I don't understand why stating factual events that are taking place  is cynical or deception.

Cool. We mostly agree here. I'd argue, you may have some blinders on about what "decentralized" means. You say it removes "trust", which is true. But importantly, it also removes accountability. Understanding this, I think, is key to understanding why fraud is so rampant. It's a feature, not a bug.

I don't think it removes accountability at all. Bitcoin is a neutral thing. Just like the internet or any other inanimate human creation. Humans have done a lot of good things using the internet to advance society, but in that same regard humans have used the internet to do a lot of bad things. The internet doesn't do these things though, humans do. Humans are ultimately accountable for their actions; accountability does not fall to the objects we choose to use, ever. Doesn't matter if it is bitcoin, the internet, cars, drugs, weapons, chemicals, energy, etc. Just because you have a new invention doesn't mean that invention removes accountability from humans in any way. I find you make generalized claims about things often in your arguments without any real world examples to back up what you're referring to when you say these things. Do you have any examples that might help illustrate your point about how bitcoin exactly removed accountability from a human?

Hah. I actually thought to include a piece about gold in my last rant, but thought it'd be too irrelevant. Kinda glad you brought it up! Let's go! Remember in my initial post, I outlined 5 characteristics that make a Ponzi a Ponzi. They were:

1. People invest into it because they expect large profits
2. That expectation is sustained by such profits being paid to those who choose to cash out—and are very vocal about this
3. However, there is no external source of revenue for those payoffs
4. Instead, the payoffs come entirely from new investment money
5. Meanwhile, the operators take away a large portion of this money

Gold investors do not expect to turn large profits. Gold bugs are gold bugs because they want to hedge against inflation or societal collapse, or communists, or whatever. They absolutely treat it as a store of value, in the old school sense. So right off the bat, that nixes #1.

Gold HAS a source of revenue besides other speculators speculating the price higher. About 2/3 of gold production is actually used/purchased by consumers as jewelry, electronics manufacturing, etc.

Now, I'm hardly a gold bug, so feel weird "defending" gold much beyond that. It's still a very stupid investment, in my opinion. Just less stupid than Bitcoin. And it certainly doesn't meet the Ponzi rules.

1) I already disagreed with your criteria for what makes a ponzi, but to go against point one I will say that a ponzi absolutely isn't required to promise outsized returns of any kind. You can just as easily have a ponzi with modest or minuscule returns to investors and it will still be a ponzi. So the fact that you exclude gold from being a ponzi scheme based on that merit is meaningless here.

2) Gold's source of "revenue" as you put it is gold's utility, which pales in comparison to the gold stocks in the world. Gold's utility is no more minuscule to its supply stocks as bitcoin's utility is to its own. Bitcoin's utility being that of a monetary good where people are using it as a hedge against local monetary inflation, against censorship, and as a means of exchange and store of value in daily life. Your other mistake is that you're measuring gold's utility against its supply, not its stock. However, gold's supply inflation rate is about 1.5% and Bitcoin's currently is at 1.8%, so they happen to be almost identical. So that means gold's utility is an extremely small portion of its stocks similar to bitcoin's utility to its stocks.

And as I mentioned, gold miners don't pay their expenses in gold, so #5 in your post still applies to gold here.

So with both my points in rebuttal to yours, I still fail to see how you have differentiated gold from bitcoin here and certainly failed to see how you've excluded gold from even your own loose definition of a ponzi scheme.

People can freely use the Internet without investing in it (whatever that would even mean?!). This analogy does not hold up.

I don't mean to be pedantic here, but you don't think people are invested in the internet? They may not be holding a certificate or token saying they "own some internet", but they absolutely are invested in it. Take away the internet and most businesses probably won't have a business. If that isn't being invested in something, I don't know what either. Regardless, my point about comparing the two still stands because your claim was that "technical obfuscation" is part of bitcoin's fraud.

Regardless, I think my point was once again misunderstood. My point wasn't: one must understand the complete inner-workings of Bitcoin before investing. My point was: Bitcoin's inner-workings are cited often (see how many tech reporters claim Bitcoin mining is "solving complex math problems"—a completely ridiculous statement) almost as a symbol that there must be something happening that's producing the value. The technological complexity is used to lull people into a false sense that it must be 1. too complicated for them to understand, and 2. doing something valuable. The number goes up because something is worthwhile is happening. Arrogance, I think, compounds this, because people are too embarrassed to acknowledge they don't understand it, and feel part of an in-group by participating to show off how smart and ahead-of-the-pack they are. Blockchain is Computer Science's String Theory—a largely useless bunch of malarkey that not-all-that-bright dipshits think is "super-interesting" despite understanding virtually 0 of it.

Your examples of bitcoin mining being described as "solving complex math problems" is hardly an apt description of this fraud your claiming exists. Media is simply writing articles for mass appeal and accurately describing bitcoin mining as running the SHA256 algorithm over and over again on bundled transactions with randomized nonce values until the output meets the current difficulty requirements is hardly going to help non-technical readers understand anything more than simply stating that it is "solving complex math problems" which is certainly accurate enough for the majority of people to get the gist. Claiming that simplifying something down is fraud is quite the stretch.

Whether you consider mining as something productive thus comes down to whether or not you feel bitcoin is of value to humanity as this is a required component for the bitcoin network's security. If you don't feel bitcoin is of benefit to humanity, then obviously you won't see that as being productive and vice versa.

Y'know, to be honest, you seem offended at the implication that you're a "crypto bro", but you parrot the same really absurd arguments as crypto bros. How is Nassim Taleb—himself a former bit of crypto bro—threatened by Bitcoin? Is the World Bank actually threatened by Bitcoin? You've drank some kool-aid if that's really your perspective here.

Again, I am not going to get into name calling here to prove points. My arguments will stand on their own without resorting to that. I'm also not going to appeal to authority like this either. The World Bank doesn't need to feel threatened to realize that bitcoin stands for everything the World Bank is not. No one expects the World Bank to say anything nice toward bitcoin seeing as how bitcoin stands for everything the WB isn't. Therefore it is hardly the unbiased take you should look for if you're going to appeal to any authority. That's like expecting an honest perspective on climate change from the oil industry.

For what it is worth, Nassim Taleb's change of heart almost certainly has to do with his beef with another bitcoin proponent (Ammous) with whom he wrote a foreword for and they had a falling out. So if Taleb's authority is who you're going to look to as evidence of bitcoin's fraud in this case, it falls flat when even many noted bitcoin critiques have called Taleb's paper criticizing bitcoin absolute "drivel" (which it is):

https://twitter.com/GeorgeSelgin/status/1407866340459884551

George Selgin has been in moderated debates against bitcoin and even he sees through Taleb's non-sense, which quite frankly he has exhibited some very strange behavior and comments over the last year. I mention Selgin here not as an appeal to authority, but as a contrast to Taleb being seen as an authority on the matter at all. If your critiques of bitcoin fail to even garner praise from other critics of it, you're doing something wrong.

I could get into it myself as to why Taleb's take on bitcoin makes absolutely zero sense, but that's for another time.
« Last Edit: February 03, 2022, 06:06:30 PM by lifeanon269 »

waltworks

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Re: What do you think of adding a low% of crypto allocation
« Reply #916 on: February 03, 2022, 03:33:57 PM »
So to sum up the argument, BTC is a ridiculous south seas bubble with super limited utility as a currency or store of value, but we are disagreeing about whether it's technically fraud/a Ponzi scheme.

Is that about right?

-W

DaTrill

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Re: What do you think of adding a low% of crypto allocation
« Reply #917 on: February 03, 2022, 04:52:09 PM »
"A fool and their money are easily parted"

This will take years to washout.  If one is a crypto bro and haven't paid for your Caribbean villa, you're too late.     


the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #918 on: February 03, 2022, 05:34:13 PM »
With all due respect, lifeanon, you’ve just again repeatedly mischaracterized virtually every point I attempted to make. I don’t wish to continue discussing this with you. I mean you no ill will: either I’m writing in a very ambiguous manner or you’re misreading my writing, or some combination of both. This isn’t productive.

ETA: I will respond to the one point you did respond to: that Madoff promised returns. From the court documents:
Quote

First, the promise of exorbitant returns is often a characteristic of a Ponzi scheme but is not the sine qua non of a Ponzi scheme. See Dreier, 2014 WL 47774, at *9 (“These badges are, however, merely characteristics of many Ponzi schemes but a Ponzi scheme can exist without them.”). Certain transferee-defendants raised the same objection in Armstrong v. Collins, No. 01 Civ. 2437 (PAC), 2010 WL 1141158, at *23 (S.D.N.Y. Mar. 24, 2010). District Judge Crotty rejected the argument as a factual matter and added the following:
In any event, even assuming [the fraudster] did not promise or represent high rates of return, this does not mean that he was not running a Ponzi
- 14 -

scheme. “Case law has revealed that a clever twist on the Ponzi concept will not remove a fraudulent scheme from the definition of Ponzi.”
Id. (quoting Forman v. Salzano (In re Norvergence, Inc.), 405 B.R. 709, 730 (Bankr. D. N.J. 2009)).

Here, Madoff operated BLMIS as a classic Ponzi scheme notwithstanding the purported absence of the promise of high returns: he misrepresented to clients and prospective clients that he would invest their funds using the SSC Strategy

Source: https://www.nysb.uscourts.gov/sites/default/files/opinions/174497_18997_opinion.pdf
« Last Edit: February 03, 2022, 06:02:58 PM by the_gastropod »

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #919 on: February 03, 2022, 06:34:30 PM »
ETA: I will respond to the one point you did respond to: that Madoff promised returns. From the court documents:
Quote

First, the promise of exorbitant returns is often a characteristic of a Ponzi scheme but is not the sine qua non of a Ponzi scheme. See Dreier, 2014 WL 47774, at *9 (“These badges are, however, merely characteristics of many Ponzi schemes but a Ponzi scheme can exist without them.”). Certain transferee-defendants raised the same objection in Armstrong v. Collins, No. 01 Civ. 2437 (PAC), 2010 WL 1141158, at *23 (S.D.N.Y. Mar. 24, 2010). District Judge Crotty rejected the argument as a factual matter and added the following:
In any event, even assuming [the fraudster] did not promise or represent high rates of return, this does not mean that he was not running a Ponzi
- 14 -

scheme. “Case law has revealed that a clever twist on the Ponzi concept will not remove a fraudulent scheme from the definition of Ponzi.”
Id. (quoting Forman v. Salzano (In re Norvergence, Inc.), 405 B.R. 709, 730 (Bankr. D. N.J. 2009)).

Here, Madoff operated BLMIS as a classic Ponzi scheme notwithstanding the purported absence of the promise of high returns: he misrepresented to clients and prospective clients that he would invest their funds using the SSC Strategy

Source: https://www.nysb.uscourts.gov/sites/default/files/opinions/174497_18997_opinion.pdf

I don't think that proves your point the way you think it does. That was the defense's claims; that they didn't promise overly exuberant returns. Of course they're going to say that in their defense! But he did promise returns to his investors, which the defense claims weren't too far outside typical market returns (except for the fact that they were way too consistent to be real). This is what led many to suspect Bernie to be a fraud to begin with. The fact that Bernie didn't promise overly exuberant returns is one of the reasons why he was able to continue his ponzi scheme for so long. Typically ponzi schemes promise returns of 20-50% or more and they collapse quickly. However, Bernie was able to keep his ponzi going for decades.

But he absolutely did often promise returns to his investors, which is one way he was able to bring in new investors because he was promising returns during economic downturns that no one else was able to produce. Per FBI's records of criminal charges:

https://archives.fbi.gov/archives/newyork/press-releases/2009/nyfo031009.htm
Quote
Further, to induce new and continued investments by clients and prospective clients, MADOFF promised certain clients annual returns in varying amounts of up to approximately 46 percent per year. MADOFF also told certain clients that the fee for his services would be based on an approximately $0.04 per share commission on the stocks that MADOFF traded for such clients.
...
Furthermore, account statements and trade confirmations sent to clients reflected fictitious returns consistent with the returns that had previously been promised to them.

So yes, Bernie Madoff did promise returns to his investors.

LateStarter

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Re: What do you think of adding a low% of crypto allocation
« Reply #920 on: February 04, 2022, 07:22:55 AM »
So celebrities paid to shill crypto isn't dishonest or misleading at all?

https://slate.com/technology/2021/10/ben-mckenzie-crypto-celebrities-kardashian-brady-lohan.html

The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

Nobody throughout this entire topic has claimed there is zero fraud in the crypto universe. There clearly is some, probably quite a lot in the murky depths of the smaller alt-coins.

An instance of fraud, or even a lot of fraud, does not prove that crypto itself is fundamentally fraudulent.

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #921 on: February 04, 2022, 07:29:42 AM »
The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

I present to you "Bitcoin for Hotties" - Megan Thee Stallion - a celebrity shilling for Bitcoin:
https://www.youtube.com/watch?v=5AN5veSPfY4&ab_channel=MeganTheeStallion

But then there are also the celebrities who are shilling for Bitcoin without their knowledge because bitcoin pushers have fraudulently used them in ads:
https://finance.yahoo.com/news/harry-and-meghan-images-misused-in-fake-crypto-endorsement-103228176.html
« Last Edit: February 04, 2022, 07:38:55 AM by GuitarStv »

LateStarter

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Re: What do you think of adding a low% of crypto allocation
« Reply #922 on: February 04, 2022, 07:46:51 AM »
The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

I present to you "Bitcoin for Hotties" - Megan Thee Stallion - a celebrity shilling for Bitcoin:
https://www.youtube.com/watch?v=5AN5veSPfY4&ab_channel=MeganTheeStallion

Haha, that was truly educational on many levels !
I guess that's conclusive proof that the whole thing is a scam. I will sell immediately     /s


I think you maybe missed the relevance of my final sentence:

An instance of fraud, or even a lot of fraud, does not prove that crypto itself is fundamentally fraudulent.

Just as well too otherwise, thanks to Bernie Madoff, Enron, sub-prime CDO's, Theranos, etc. etc., we'd have nothing left in the conventional financial world to invest in either.

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #923 on: February 04, 2022, 08:18:11 AM »
An instance of fraud, or even a lot of fraud, does not prove that crypto itself is fundamentally fraudulent.

Just as well too otherwise, thanks to Bernie Madoff, Enron, sub-prime CDO's, Theranos, etc. etc., we'd have nothing left in the conventional financial world to invest in either.

I agree.  The dishonesty surrounding bitcoin doesn't mean that all other crypto is fraudulent.

But there very clearly currently exists dishonest and misleading representation regarding bitcoin, created by some of the people trying to sell the cryptocurrency.  This would seem to be a pretty good counter to the argument 'bitcoin can't be a ponzi scheme because there's no deception'.

ChpBstrd

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Re: What do you think of adding a low% of crypto allocation
« Reply #924 on: February 04, 2022, 08:18:31 AM »
It’s fascinating to me how people can mentally categorize two things that are technically duplicates - one as a legit investment and the other as an obvious fraud.

Bitcoin and Ethereum are legit because they have more interest from the media and people buying them. 3,000 copy versions of these softwares, however, each with the exact same potential functionality as Bitcoin or Ethereum are obvious pump and dump scams that will end in tears.

If you paid thousands of dollars to own BTC and ETH because you think they’ll have utility in the future, why not pay a thousandth of a penny to own the latest altcoin with the exact same - or better! - use cases as future units of transaction. They are literally the same things.

The only answer to the question above is something about popularity, momentum, what other people are doing, and conclusions based on these two points about what other people will do in the future. This answer gives up any pretense of being about utility and dances around a core argument that greater fools will trade you more USD for these particular coins in the future.

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #925 on: February 04, 2022, 08:27:49 AM »
But then there are also the celebrities who are shilling for Bitcoin without their knowledge because bitcoin pushers have fraudulently used them in ads:
https://finance.yahoo.com/news/harry-and-meghan-images-misused-in-fake-crypto-endorsement-103228176.html

Bitcoin has as much to do with these scams as the British pound does and yet I don't see people calling out the pound or dollar every time someone tries to scam someone for money. When it comes to scamming people for money, money will inherently be involved. Not sure why that is surprising to some.

These were some of the advertisement lines used to grab people's attention according to these articles:

"People earning millions from home by using Harry and Meghan latest advice."
"Harry and Meghan shocked everyone in the studio by revealing how they making an extra £128,000 every month."

Bitcoin just gets roped into these because people know people have made a lot of money with bitcoin as it appreciated so scammers inherently use its name to grab people's attention into your typical "get-rich-quick" scheme. Not sure why that is different from any other get-rich-quick scheme that has been touted decades. It is the same old story.

LateStarter

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Re: What do you think of adding a low% of crypto allocation
« Reply #926 on: February 04, 2022, 08:29:56 AM »
It’s fascinating to me how people can mentally categorize two things that are technically duplicates - one as a legit investment and the other as an obvious fraud.

Bitcoin and Ethereum are legit because they have more interest from the media and people buying them. 3,000 copy versions of these softwares, however, each with the exact same potential functionality as Bitcoin or Ethereum are obvious pump and dump scams that will end in tears.

If you paid thousands of dollars to own BTC and ETH because you think they’ll have utility in the future, why not pay a thousandth of a penny to own the latest altcoin with the exact same - or better! - use cases as future units of transaction. They are literally the same things.

The only answer to the question above is something about popularity, momentum, what other people are doing, and conclusions based on these two points about what other people will do in the future. This answer gives up any pretense of being about utility and dances around a core argument that greater fools will trade you more USD for these particular coins in the future.

It’s fascinating to me how people can mentally categorise two things that are superficially similar as identical . . . . shrug

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #927 on: February 04, 2022, 08:33:42 AM »
It’s fascinating to me how people can mentally categorize two things that are technically duplicates - one as a legit investment and the other as an obvious fraud.

Bitcoin and Ethereum are legit because they have more interest from the media and people buying them. 3,000 copy versions of these softwares, however, each with the exact same potential functionality as Bitcoin or Ethereum are obvious pump and dump scams that will end in tears.


And this is part of the problem right here. I don't think you will find many people that don't agree there aren't thousands of scams among cryptocurrencies. They're all hype at best and scams/fraud and worst.

The problem is that bitcoin has become eponymous with cryptocurrency and so anything to do with cryptocurrencies and the scams they bring will immediately be associated with bitcoin or sometimes even be called bitcoin when they couldn't be further from it. Unfortunately, as with any technology, regulators are way far beyond on being knowledgeable about the space enough to make any enforcement of what is taking place meaningful while at the same time not completely ruining the industry with inept policies.

index

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Re: What do you think of adding a low% of crypto allocation
« Reply #928 on: February 04, 2022, 08:55:44 AM »
@lifeanon269, where are you getting only 3% of the gold stock has been used in jewelry? I'm seeing almost half of the world's gold stock is tied up in jewelry and roughly 60% of the yearly supply is used in jewelry or industrial purposes.

erjkism

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Re: What do you think of adding a low% of crypto allocation
« Reply #929 on: February 04, 2022, 09:06:09 AM »
It’s fascinating to me how people can mentally categorize two things that are technically duplicates - one as a legit investment and the other as an obvious fraud.

Bitcoin and Ethereum are legit because they have more interest from the media and people buying them. 3,000 copy versions of these softwares, however, each with the exact same potential functionality as Bitcoin or Ethereum are obvious pump and dump scams that will end in tears.


And this is part of the problem right here. I don't think you will find many people that don't agree there aren't thousands of scams among cryptocurrencies. They're all hype at best and scams/fraud and worst.

The problem is that bitcoin has become eponymous with cryptocurrency and so anything to do with cryptocurrencies and the scams they bring will immediately be associated with bitcoin or sometimes even be called bitcoin when they couldn't be further from it. Unfortunately, as with any technology, regulators are way far beyond on being knowledgeable about the space enough to make any enforcement of what is taking place meaningful while at the same time not completely ruining the industry with inept policies.

People have been calling bitcoin a fraud since it's inception. There is nothing you can do to convince them otherwise, it's an idealogical stance not based on empirical evidence. When bitcoin is 500k and a reserve asset in sovereign wealth funds/pension funds/etc. they will still claim it is a fraud and that you have been a fool to be involved with it.

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #930 on: February 04, 2022, 09:12:00 AM »
@lifeanon269, where are you getting only 3% of the gold stock has been used in jewelry? I'm seeing almost half of the world's gold stock is tied up in jewelry and roughly 60% of the yearly supply is used in jewelry or industrial purposes.

I stand corrected. You'd be correct. One of the graphs I was looking at was misleading since it only broke down the incoming supply by use-case, but not the total stock. This website was more clear and matches with your numbers:

https://www.gold.org/goldhub/data/above-ground-stocks

talltexan

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Re: What do you think of adding a low% of crypto allocation
« Reply #931 on: February 04, 2022, 10:02:29 AM »
The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

I present to you "Bitcoin for Hotties" - Megan Thee Stallion - a celebrity shilling for Bitcoin:
https://www.youtube.com/watch?v=5AN5veSPfY4&ab_channel=MeganTheeStallion

But then there are also the celebrities who are shilling for Bitcoin without their knowledge because bitcoin pushers have fraudulently used them in ads:
https://finance.yahoo.com/news/harry-and-meghan-images-misused-in-fake-crypto-endorsement-103228176.html

I cannot identify a false statement that Megan Thee Stallion makes in the video.

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #932 on: February 04, 2022, 10:16:28 AM »
The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

I present to you "Bitcoin for Hotties" - Megan Thee Stallion - a celebrity shilling for Bitcoin:
https://www.youtube.com/watch?v=5AN5veSPfY4&ab_channel=MeganTheeStallion

But then there are also the celebrities who are shilling for Bitcoin without their knowledge because bitcoin pushers have fraudulently used them in ads:
https://finance.yahoo.com/news/harry-and-meghan-images-misused-in-fake-crypto-endorsement-103228176.html

I cannot identify a false statement that Megan Thee Stallion makes in the video.


- bitcoin is not a currency (oddly enough, this is even disproven by her later statements that the only thing making bitcoin valuable is scarcity - like other non-currencies gold and silver . . . and unlike real currency)
- bitcoin cannot be controlled by anyone (51% attack makes this statement unequivocally false)

There are is also untruthful 'number goes up - always' messages, both spoken and unspoken:
- Are most bitcoin investors playing jenga with gold bars against their manservant at home?
- "With my knowledge and your hustle, you'll have your own empire in no time.  I'll see you at the top!"

joe189man

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Re: What do you think of adding a low% of crypto allocation
« Reply #933 on: February 04, 2022, 10:28:20 AM »
I think its fine to add a low % of crypto to your total asset allocation. I have a 0.38% in crypto at the moment and plan to add to it over time to achieve around 1-2% of total assets then re-assess.

I think you could interchange crypto with anything in the OPs subject line all in the name of diversification, things like single stocks, rental estate, raw land, collectible cars, precious metals, jewelry, art, antiques, etc.

the_gastropod

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Re: What do you think of adding a low% of crypto allocation
« Reply #934 on: February 04, 2022, 10:46:49 AM »
I think its fine to add a low % of crypto to your total asset allocation. I have a 0.38% in crypto at the moment and plan to add to it over time to achieve around 1-2% of total assets then re-assess.

I think you could interchange crypto with anything in the OPs subject line all in the name of diversification, things like single stocks, rental estate, raw land, collectible cars, precious metals, jewelry, art, antiques, etc.

...lotto tickets, Nigerian princes, Rush Limbaugh faced Gold Bullion coins, etc.

talltexan

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Re: What do you think of adding a low% of crypto allocation
« Reply #935 on: February 04, 2022, 10:58:53 AM »
The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

I present to you "Bitcoin for Hotties" - Megan Thee Stallion - a celebrity shilling for Bitcoin:
https://www.youtube.com/watch?v=5AN5veSPfY4&ab_channel=MeganTheeStallion

But then there are also the celebrities who are shilling for Bitcoin without their knowledge because bitcoin pushers have fraudulently used them in ads:
https://finance.yahoo.com/news/harry-and-meghan-images-misused-in-fake-crypto-endorsement-103228176.html

I cannot identify a false statement that Megan Thee Stallion makes in the video.


- bitcoin is not a currency (oddly enough, this is even disproven by her later statements that the only thing making bitcoin valuable is scarcity - like other non-currencies gold and silver . . . and unlike real currency)
- bitcoin cannot be controlled by anyone (51% attack makes this statement unequivocally false)

There are is also untruthful 'number goes up - always' messages, both spoken and unspoken:
- Are most bitcoin investors playing jenga with gold bars against their manservant at home?
- "With my knowledge and your hustle, you'll have your own empire in no time.  I'll see you at the top!"

Thank you for engaging.

I did not begin the day expecting to encounter a post with Megan Thee Stallion and 51% network attack contained within the same idea.

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #936 on: February 04, 2022, 11:09:25 AM »
The ongoing discussion re. fraud / not fraud is exclusively about Bitcoin.
Some shilling of a trivial alt-coin (with <1yr history and a market cap of $19 million) by a few trashy celebs says nothing about Bitcoin.

I present to you "Bitcoin for Hotties" - Megan Thee Stallion - a celebrity shilling for Bitcoin:
https://www.youtube.com/watch?v=5AN5veSPfY4&ab_channel=MeganTheeStallion

But then there are also the celebrities who are shilling for Bitcoin without their knowledge because bitcoin pushers have fraudulently used them in ads:
https://finance.yahoo.com/news/harry-and-meghan-images-misused-in-fake-crypto-endorsement-103228176.html

I cannot identify a false statement that Megan Thee Stallion makes in the video.


- bitcoin is not a currency (oddly enough, this is even disproven by her later statements that the only thing making bitcoin valuable is scarcity - like other non-currencies gold and silver . . . and unlike real currency)
- bitcoin cannot be controlled by anyone (51% attack makes this statement unequivocally false)

There are is also untruthful 'number goes up - always' messages, both spoken and unspoken:
- Are most bitcoin investors playing jenga with gold bars against their manservant at home?
- "With my knowledge and your hustle, you'll have your own empire in no time.  I'll see you at the top!"

Thank you for engaging.

I did not begin the day expecting to encounter a post with Megan Thee Stallion and 51% network attack contained within the same idea.

A day without at least a few surreal moments in it is a day wasted.  :P

StashingAway

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Re: What do you think of adding a low% of crypto allocation
« Reply #937 on: February 04, 2022, 12:47:04 PM »
It’s fascinating to me how people can mentally categorize two things that are technically duplicates - one as a legit investment and the other as an obvious fraud.

Bitcoin and Ethereum are legit because they have more interest from the media and people buying them. 3,000 copy versions of these softwares, however, each with the exact same potential functionality as Bitcoin or Ethereum are obvious pump and dump scams that will end in tears.


And this is part of the problem right here. I don't think you will find many people that don't agree there aren't thousands of scams among cryptocurrencies. They're all hype at best and scams/fraud and worst.

The problem is that bitcoin has become eponymous with cryptocurrency and so anything to do with cryptocurrencies and the scams they bring will immediately be associated with bitcoin or sometimes even be called bitcoin when they couldn't be further from it. Unfortunately, as with any technology, regulators are way far beyond on being knowledgeable about the space enough to make any enforcement of what is taking place meaningful while at the same time not completely ruining the industry with inept policies.

I have a couple of questions for you. I've been out of the space for years. I am interested in the critique of most crypto that it heavily rewards early adopters. By that, they (bitcoin, etherum, etc.) create hierarchies of wealth for their inventors and investors that seemingly undermines the spirit of the system. Someone who managed to keep their wallet of a couple of hundred bitcoin from a few years ago is now rolling deep, as well as all of the corporations who started mining when they could take advantage of the scale of larger rigs. This seems to punish late adopters- the folks who in theory would benefit most from a "decentralized" currency. I suspect this is some of the pointed anger of luddites that is felt by crypto enthusiasts, where those who missed the boat seemingly push back because they are envious. I don't doubt that there is some of that, but I also suspect that a lot of the push back is because there is something fishy about pushing a product that simultaneously makes the person rich. If the designers and early adopters donated all but a salary's worth of their crypto earnings each year then they might have a foot to stand on, but as it is, most developments (etherum, lightning network, etc.) only serve to get more people to buy the crypto, which at the end of the day is more cash for the holders.

My question: are there any coin projects that try to do away with this dilemma? Coins that don't have some kind of mechanism that re-distributes wealth to tech enthusiasts but instead is more egalitarian? It seems like a catch-22, in that it's hard to get masses of people to adopt a simple currency vs. a speculative growth coin. I don't go down to the car wash to exchange for their tokens just in case they raise in value. I just use them when I'm there because that's what's accepted. It would seem for a transition from speculation to currency would need to solve this, IMO.

I know this stuff is has been discussed somewhat in this thread, but am curious if anyone in the space has an answer to this.

talltexan

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Re: What do you think of adding a low% of crypto allocation
« Reply #938 on: February 04, 2022, 01:51:48 PM »
Stable coins (because they don't appreciate) seem like they would answer this critique.

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #939 on: February 04, 2022, 05:22:07 PM »
I have a couple of questions for you. I've been out of the space for years. I am interested in the critique of most crypto that it heavily rewards early adopters. By that, they (bitcoin, etherum, etc.) create hierarchies of wealth for their inventors and investors that seemingly undermines the spirit of the system. Someone who managed to keep their wallet of a couple of hundred bitcoin from a few years ago is now rolling deep, as well as all of the corporations who started mining when they could take advantage of the scale of larger rigs. This seems to punish late adopters- the folks who in theory would benefit most from a "decentralized" currency. I suspect this is some of the pointed anger of luddites that is felt by crypto enthusiasts, where those who missed the boat seemingly push back because they are envious.

I don't think it creates a hierarchy at all. There are so many people that held bitcoin early on, but because some of the massive price swings, they sold at some point. The number of people who have held through everything is very small. There are also plenty of people who bought and sold early on and lost money as each of the bubbles have created FOMO waves. I know some of those people; those who only paid attention during the hype cycles and bought in at the last moment only to have the rug pulled out from them. So there really isn't any concept of a hierarchy of early vs late adopters.

Also, the idea that those who bought and held since early on are rewarded isn't any different than any other investment. Those who bought Tesla and held through some of the worst negative news cycles as Tesla was massively shorted have been rewarded handsomely.

It all comes down to risk versus reward. Those who bought Tesla early on were taking on a ton of risk. It was a new car company that was being massively shorted and had a ton of cash flow problems. At one point it was on the verge of bankruptcy until Musk went all in himself. It isn't any different with bitcoin. Bitcoin early was just a nascent idea that many would never imagine would be worth $40,000 today.

Finally, I don't think late adopters are "punished" not being invested early on. Bitcoin didn't steal anything from them and they haven't been harmed in any way. They have a choice they can make every day whether or not they want to hold/use any or not. At the end of the day, even if the days of large returns in bitcoin are over, no one is punished for using or not using bitcoin. If you want to use bitcoin and you feel it benefits you, then use it. It is as simple as that. You can't change the past, all you can change is what happens next.

I don't doubt that there is some of that, but I also suspect that a lot of the push back is because there is something fishy about pushing a product that simultaneously makes the person rich. If the designers and early adopters donated all but a salary's worth of their crypto earnings each year then they might have a foot to stand on, but as it is, most developments (etherum, lightning network, etc.) only serve to get more people to buy the crypto, which at the end of the day is more cash for the holders.

I would argue that this is no different than just about anything someone wants to promote. If someone believes in something, they're likely going to be invested in it themselves, simple as that. If I believe in solar power and think it is going to really benefit society and help curb climate change, then I am going to be a really big proponent of solar power, but I'm also probably going to be invested in companies that produce solar panels. If I believe in electric cars because I think they're a better alternative, then I'm probably going to be driving an EV and might also be invested in an electric car company because I want them to succeed. People who are big proponents of things are also probably people who are more knowledgeable on the subject than your average person and so they're more likely to be comfortable investing in something they know a lot about. It is just the nature of these things.

Think of the flip side of it, what do you think would be fishier? Someone who is promoting bitcoin to other people but isn't invested in it themselves or someone who is promoting bitcoin but has a ton at stake in bitcoin? I would say the former is much more suspicious. It is called having "skin in the game" and I'd much rather take advice from someone who is just as invested in the thing they're promoted as those they're communicating with.

My question: are there any coin projects that try to do away with this dilemma? Coins that don't have some kind of mechanism that re-distributes wealth to tech enthusiasts but instead is more egalitarian? It seems like a catch-22, in that it's hard to get masses of people to adopt a simple currency vs. a speculative growth coin. I don't go down to the car wash to exchange for their tokens just in case they raise in value. I just use them when I'm there because that's what's accepted. It would seem for a transition from speculation to currency would need to solve this, IMO.

I know this stuff is has been discussed somewhat in this thread, but am curious if anyone in the space has an answer to this.

I guess it comes down to what benefits you're looking to get out of the system. At the end of the day, a blockchain's only benefit is to be decentralized with the least amount of trust required as possible. If you're going to have a stable-coin tied to the value of something else, that is inherently not going to be decentralized. Therefore there is no point in using a blockchain database. If you're just looking to have a system that provides speedy and cheap payments and don't care about decentralization, we have solutions like that (Venmo, Paypal, CashApp, Zelle, etc). Speedy and cheap payments isn't anything new in the tech world.

If you value decentralization then you're going to need a monetary policy that can be pre-programmed without requiring outside sources of information to be adjusted. Bitcoin's monetary policy is essentially completely arbitrary. The important thing is that it can be verified and is predictable. It very well could have been inflated forever and thus been less relatively scarce. But then you have the problem where decreasing block rewards are important for transitioning to a fee-based mining incentive. This is an important factor for ensuring that bitcoin's energy usage is as efficient as possible (economic transaction activity = energy spent).

Bitcoin had an "immaculate conception" with regards to its bootstrapping. It was created anonymously, circulated for several years before it ever even had an exchange price, had no pre-mine or closed insider circle of investors, and was created when the idea of a cryptocurrency was never a thought. This can never again be repeated. The cat is out of the bag. So, IMO this is the only chance at a truly fair and open decentralized currency that has no authority that creates or governs it and that can be trusted on those merits.

ChpBstrd

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Re: What do you think of adding a low% of crypto allocation
« Reply #940 on: February 04, 2022, 07:42:38 PM »
It’s fascinating to me how people can mentally categorize two things that are technically duplicates - one as a legit investment and the other as an obvious fraud.

Bitcoin and Ethereum are legit because they have more interest from the media and people buying them. 3,000 copy versions of these softwares, however, each with the exact same potential functionality as Bitcoin or Ethereum are obvious pump and dump scams that will end in tears.


And this is part of the problem right here. I don't think you will find many people that don't agree there aren't thousands of scams among cryptocurrencies. They're all hype at best and scams/fraud and worst.

The problem is that bitcoin has become eponymous with cryptocurrency and so anything to do with cryptocurrencies and the scams they bring will immediately be associated with bitcoin or sometimes even be called bitcoin when they couldn't be further from it. Unfortunately, as with any technology, regulators are way far beyond on being knowledgeable about the space enough to make any enforcement of what is taking place meaningful while at the same time not completely ruining the industry with inept policies.

I have a couple of questions for you. I've been out of the space for years. I am interested in the critique of most crypto that it heavily rewards early adopters. By that, they (bitcoin, etherum, etc.) create hierarchies of wealth for their inventors and investors that seemingly undermines the spirit of the system. Someone who managed to keep their wallet of a couple of hundred bitcoin from a few years ago is now rolling deep, as well as all of the corporations who started mining when they could take advantage of the scale of larger rigs. This seems to punish late adopters- the folks who in theory would benefit most from a "decentralized" currency. I suspect this is some of the pointed anger of luddites that is felt by crypto enthusiasts, where those who missed the boat seemingly push back because they are envious. I don't doubt that there is some of that, but I also suspect that a lot of the push back is because there is something fishy about pushing a product that simultaneously makes the person rich. If the designers and early adopters donated all but a salary's worth of their crypto earnings each year then they might have a foot to stand on, but as it is, most developments (etherum, lightning network, etc.) only serve to get more people to buy the crypto, which at the end of the day is more cash for the holders.

My question: are there any coin projects that try to do away with this dilemma? Coins that don't have some kind of mechanism that re-distributes wealth to tech enthusiasts but instead is more egalitarian? It seems like a catch-22, in that it's hard to get masses of people to adopt a simple currency vs. a speculative growth coin. I don't go down to the car wash to exchange for their tokens just in case they raise in value. I just use them when I'm there because that's what's accepted. It would seem for a transition from speculation to currency would need to solve this, IMO.

I know this stuff is has been discussed somewhat in this thread, but am curious if anyone in the space has an answer to this.

Well, yes. The whole incentive for risking one's real money is to get rich by paying less for a cryptocoin than someone else will pay you for it in the future. That future is:

Quote
When bitcoin is 500k and a reserve asset in sovereign wealth funds/pension funds/etc.

And the people paying $500,000 USD to obtain a single bitcoin will be folks like me, because it's how the economy now operates, it's the only way to pay bills, my USD are nearly worthless, and/or I have no choice because I didn't get on the bandwagon soon enough. The handful of people who bought early will live in mansions paid for by the late adopters.

That. Is. The. Plan.

One thing I don't understand about the plan is how we'll live in a world where millions of blockchain transactions are processed every second and yet my only choice as a too-late adopter to cryptocurrency will be bitcoin (or pick any coin). I.e. the majority of people will choose to fork over their wealth to the holders of bitcoin rather than just picking another cryptocurrency to transact with and doing immediate USD>crypto conversions on their devices. There are already in 2022 phone apps that can let me pick which government currency I want to pay with or invest with, but somehow no such thing will ever exist for cryptocurrencies. Some technical barrier will prevent it, and all the too-late-adopters will be cornered into paying through the nose for the one limited supply currency of the future.

The other thing I don't understand about the plan is that in this future scenario where corporations start making sales and reporting earnings in the new reserve currency Bitcoin, wouldn't ownership of stock provide one with a way to obtain a steady stream of Bitcoin through dividends or by selling the stock for Bitcoin? This way, you get access to the currency of the future in the end, whether that currency is USD, fractional shares in a particular NFT that everyone decided on, or the 18th fork of LiteCoin, and you get to avoid all the risk of currency speculation. FIRE is FIRE even if we change currencies. The only net losers would be people in bonds or with mattresses stuffed full of paper bills. 

So to answer your question, there are two very good reasons why the supply of people willing to enrich earlier entrants will eventually run out.

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #941 on: February 04, 2022, 08:17:16 PM »
@ChpBstrd, I'm not sure I really follow much of what you're saying here. A circular economy under the dollar, bitcoin, or any other currency will largely operate the same. So I don't understand your statement about late-adopters forking over their wealth to early-adopters. You "fork over wealth" all the time under a circular economy with the USD. It is called buying things. People also "fork over wealth" to you for the work you do, it is called wages. Under a circular economy, people who have bitcoin will be buying things with it, whether they're a late or early adopter, it doesn't matter. If your wages today pays for groceries and rent every month, then that will be the case under a fiat or bitcoin circular economy. At the end of the day you're still going to have producers and consumers circulating goods and services all the same.

If you're a late-adopter and the price of bitcoin is $500,000, it isn't like you lost anything just because it is now that price and you're sitting on zero bitcoin. Your wages are still the same, so nothing changed there either.

The idea that the supply of entrants looking to enrich themselves will run out doesn't make sense in this regard when we're talking about bitcoin having a circular economy and being a part of sovereign wealth like you mentioned. Maybe I just didn't follow all that you said, as it was a lot. So correct me if I misunderstood.

ChpBstrd

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Re: What do you think of adding a low% of crypto allocation
« Reply #942 on: February 04, 2022, 10:02:48 PM »
@ChpBstrd, I'm not sure I really follow much of what you're saying here. A circular economy under the dollar, bitcoin, or any other currency will largely operate the same. So I don't understand your statement about late-adopters forking over their wealth to early-adopters. You "fork over wealth" all the time under a circular economy with the USD. It is called buying things. People also "fork over wealth" to you for the work you do, it is called wages. Under a circular economy, people who have bitcoin will be buying things with it, whether they're a late or early adopter, it doesn't matter. If your wages today pays for groceries and rent every month, then that will be the case under a fiat or bitcoin circular economy. At the end of the day you're still going to have producers and consumers circulating goods and services all the same.

If you're a late-adopter and the price of bitcoin is $500,000, it isn't like you lost anything just because it is now that price and you're sitting on zero bitcoin. Your wages are still the same, so nothing changed there either.

The idea that the supply of entrants looking to enrich themselves will run out doesn't make sense in this regard when we're talking about bitcoin having a circular economy and being a part of sovereign wealth like you mentioned. Maybe I just didn't follow all that you said, as it was a lot. So correct me if I misunderstood.

I'll illustrate. My local grocery stores currently only accept payment in US dollars. If next week, next year, or next decade, they switch to only accepting payment in a particular cryptocurrency, I will be forced to purchase that currency from people who currently own it if I like to eat.

One way I might do so is if my job decides to or offers to stop paying me in US dollars and to instead start paying me in this particular cryptocurrency. Then I will be essentially working for the benefit of people holding that particular cryptocurrency (let's say Dogecoin wins the battle, just for illustration and fun).

I might have to trade a week's labor for a one-thousandth of a Dogecoin. My employer trades the outputs of my labor for the Dogecoin from an early adopter. Then I trade my one-thousandth of a Dogecoin for groceries.

One might say we all work for rich capitalists anyway, but this would be a case where we all suddenly switch to working for early adopters. The rich capitalists such as my employer and the shareholders in the grocery store might not see much change in their margins; they'd switch to "earning" Dogecoin. But any USD holdings such as bank accounts, money market accounts, bonds, or accounts payable would be decimated by the collapse of the USD, and that disappeared purchasing power would appear in the wallets of the people who bought Dogecoin for $0.20 when they had the chance. That's the plan.

Of course, it might make sense for all those market participants to decide not to pay the holders of Dogecoin $500,000 USD per coin. They could just stick with the USD and ride the hyperinflation rather than giving up everything to pay someone else for a working currency that could just as easily be copied. They could decide to create CapitalistPigCoin and forcibly create an economy around that rather than bidding at a desperate auction for a limited number of coins that nobody wants to sell or spend.

The point is, for the imagined transition to a crypto coin economy to take place, hundreds of millions of people would have to willingly choose to give a bunch of their cash wealth to someone else. They'd have to exit the circular government fiat economy where all payments are somebody else's earnings and enter a question mark economy where obtaining crypto coin from the people owning the crypto coin is the point. As the currency supply deflated, the HODLers would become nobles paying out smaller and smaller fractions of their hoard of coins in exchange for the labor of thousands of servants. We'd have to choose to do that too, rather than finding any other possible way to track, store, and transact wealth.

MustacheAndaHalf

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Re: What do you think of adding a low% of crypto allocation
« Reply #943 on: February 05, 2022, 01:20:52 AM »
Its worth noting that Zuckerberg has decided to drop his FB/Meta crypto project.

Is crypto so cool now that even the likes of Zuckerberg doesn't "get it?"
That's false, it was not Zuckerberg "doesn't get it" or "decided to stop".  It was regulators who put a stop to it, and not Zuckerberg himself as you falsely claimed.

"Mark Zuckerberg’s ambitious plan to build his own cryptocurrency is falling apart, amid growing pressure from regulators."
https://www.cnbc.com/2022/01/26/mark-zuckerbergs-botched-cryptocurrency-project-is-reportedly-for-sale.html

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #944 on: February 05, 2022, 06:54:25 AM »
@ChpBstrd there are a few flaws I think in your analysis.

1) Any transition to a bitcoin circular economy (if we are to assume it occurs) would not happen cold turkey nor over night. FWIW I don't feel we'll ever be in a solely bitcoin circular economy and FIAT is here to stay. But for the sake of the scenario, if it were to happen, it would be a transitional event. Merchants that choose to accept bitcoin would accept bitcoin along side fiat currencies much like some are doing today.

2) The other flaw in your analysis is that if merchants were to move to only accepting bitcoin as a form of payment, they would only be doing so under the premise that sales in fiat currency have been completely abandoned. If sales in fiat payments are still being made in any meaningful volume, then I don't see them just abandoning it (barring any hyper-inflationary collapse).

3) This means that if fiat sales have been completely abandoned, it is mostly like because people are being paid in bitcoin. So the idea you're making that you'd need to "will be forced to purchase that currency from people who currently own it" is a false premise. We have exchanges today because we're in a fiat world and we're all paid in fiat currency and so that is how you acquire it today. If we were instead in a bitcoin world, that would not be the case. There would be no need for exchanges because bitcoin is what we earn and bitcoin is what we spend. There is a transitory period for sure, but it is not cold turkey and therefore the scenario you present just simply would not exist.

4) The other flaw in your analysis is that the fiat rich today would suddenly not exist and that simply isn't true. So the idea that we'd all be working for the bitcoin rich suddenly doesn't make sense either. The number of early adopter bitcoiners that will become rich from bitcoin becoming mainstream pales in comparison to the number of fiat rich in the world today. Those who hold the capital resources today will still hold it under a new bitcoin economy. The executives of all the top companies will still be there under a bitcoin economy. A transition of the money being used wouldn't change that. Certainly there will be a few new rich people in the world, but there are new rich people all the time in the world. I've mentioned some of the good that could come from bitcoin being used around the world and I personally believe that good would outweigh a small percentage of new rich people coming about (as if that's a bad thing anyway).

5) You also talked about how bitcoin could just be copied, but that simply isn't true. How about I run a fiber cable to your house and connect it to a computer I have running that has a website running on it and charge you $70 a month for it and call it the internet. No? Why? Because the internet can't be copied. It is a network effect where people are using the open internet because of everything that has been built up on it (services, websites, economy, etc). The same would be true for bitcoin. There are services, economic activity, software, and the security of the network that simply can't be duplicated. If bitcoin is accepted "everywhere you want to be" and all the trials and tribulations of bitcoin coming into existence and getting to where it is now widely accepted and being earned by workers, those trials and tribulations would be even more cumbersome for any other decentralized digital currency trying to overcome the incumbent. Any reason someone might have for wanting to use another currency could be built onto bitcoin as a secondary layer. It would be extremely difficult to overcome that network effect and duplicate much like it would be difficult (and pointless) to build a new internet when instead you can just build upon the one we have.

To largely sum up, earning wages in bitcoin is should not be considered "giving their wealth" to someone else any more than it is today. You're giving your productivity in return for compensation and you don't lose if you were to suddenly choose to be paid in bitcoin in that new world versus fiat so long as you're paid an equal value.

StashingAway

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Re: What do you think of adding a low% of crypto allocation
« Reply #945 on: February 05, 2022, 07:12:17 AM »
Finally, I don't think late adopters are "punished" not being invested early on. Bitcoin didn't steal anything from them and they haven't been harmed in any way.

Look at it from a late adopter's perspective. If bitcoin/crypto were to become a main world currency (not just speculative vehicle), then there would be a massive redistribution of wealth, heavily favoring early adopters and large corps who built mining rigs.

For instance: my cousin is a teacher and makes 25K USD a year. He has slowly built himself a small and modest retirement fund. He won't get to retire until he's 55 or 60. But he is working hard and smart under the assumption that his USD will behave the same as it has for the last 100 years. He is busy and has kids, so has zero time to speculate on cyrptocurrency. The best he can do is buy bitcoin or dogecoin on coinbase if he were to ever, ever even have the time to research it enough to get to that point. It is a fun hobby for the young or techy, but it takes a shit ton of mental resources to approach and there are a lot of holes to fall in along the way. Smart for him thing to do is read to his kids at night and go for bike rides and just keep to himself. I would argue that he is contributing way more to society by doing this as well.

Say in 20 years Etherum has become the main world currency as some crypto enthusiasts would hope. It becomes the unit of measure for trade and GDP, etc. Now my brother's USD are relatively worthless, so he has to buy into this system. The problem is, he's one of the last "greater fools" to buy in. There are a ton of rich mother effers who speculated on Etherum and now a small % of folks own a huge portion of the coins.

I submit that this transfer of wealth IS stealing from them. It would be bunch of crypto folks siphoning massive amounts of wealth wealth simply because they're early adopters. There is no reason for my cousin to buy crypto right now except for to prevent himself being a late adopter. This to me is an ethical problem with the whole system. By design or by accident, it punishes late adopters, which doesn't line up with the lip service that is paid to the technology. It might liberate Venezuelans, but it does the opposite for US citizens (as it is currently designed).

There isn't much incentive to create or adopt crypto that doesn't follow this format.

I just realized that ChpBstrd said a similar thing. But this is the main stinker for me. I haven't heard a convincing response (and yours, lifeanon,  just further reinforces my stance, FYI, it dances around the problem as though there isn't one). I don't mean this in a crass way, just a matter-of-fact.


Also, the idea that those who bought and held since early on are rewarded isn't any different than any other investment. Those who bought Tesla and held through some of the worst negative news cycles as Tesla was massively shorted have been rewarded handsomely.

The difference is that my cousin who owns no Tesla (other than in index funds) doesn't have to own Tesla stock in some future envisioned scenario to make daily transactions. He can buy the new Chevy Bolt in 2030 with USD both of which benefit from Tesla's rise. He might have missed out on the Tesla growth, but his own $ isn't devalued in the process.

StashingAway

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Re: What do you think of adding a low% of crypto allocation
« Reply #946 on: February 05, 2022, 07:17:44 AM »
The other flaw in your analysis is that the fiat rich today would suddenly not exist and that simply isn't true. So the idea that we'd all be working for the bitcoin rich suddenly doesn't make sense either. The number of early adopter bitcoiners that will become rich from bitcoin becoming mainstream pales in comparison to the number of fiat rich in the world today. Those who hold the capital resources today will still hold it under a new bitcoin economy.

You can't just hand wave it away! That's not a solution!

StashingAway

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Re: What do you think of adding a low% of crypto allocation
« Reply #947 on: February 05, 2022, 07:23:18 AM »
Stable coins (because they don't appreciate) seem like they would answer this critique.

Don't these require a stable Fiat or resource to function? In other words, there wouldn't be a reason for most people to use the stablecoin when they could just own the resource/fiat directly?

lifeanon269

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Re: What do you think of adding a low% of crypto allocation
« Reply #948 on: February 05, 2022, 07:54:28 AM »
For instance: my cousin is a teacher and makes 25K USD a year. He has slowly built himself a small and modest retirement fund. He won't get to retire until he's 55 or 60. But he is working hard and smart under the assumption that his USD will behave the same as it has for the last 100 years. He is busy and has kids, so has zero time to speculate on cyrptocurrency. The best he can do is buy bitcoin or dogecoin on coinbase if he were to ever, ever even have the time to research it enough to get to that point. It is a fun hobby for the young or techy, but it takes a shit ton of mental resources to approach and there are a lot of holes to fall in along the way. Smart for him thing to do is read to his kids at night and go for bike rides and just keep to himself. I would argue that he is contributing way more to society by doing this as well.

I submit that this transfer of wealth IS stealing from them. It would be bunch of crypto folks siphoning massive amounts of wealth wealth simply because they're early adopters. There is no reason for my cousin to buy crypto right now except for to prevent himself being a late adopter. This to me is an ethical problem with the whole system. By design or by accident, it punishes late adopters, which doesn't line up with the lip service that is paid to the technology. It might liberate Venezuelans, but it does the opposite for US citizens (as it is currently designed).

There isn't much incentive to create or adopt crypto that doesn't follow this format.

I just realized that ChpBstrd said a similar thing. But this is the main stinker for me. I haven't heard a convincing response (and yours, lifeanon,  just further reinforces my stance, FYI, it dances around the problem as though there isn't one). I don't mean this in a crass way, just a matter-of-fact.


Also, the idea that those who bought and held since early on are rewarded isn't any different than any other investment. Those who bought Tesla and held through some of the worst negative news cycles as Tesla was massively shorted have been rewarded handsomely.

The difference is that my cousin who owns no Tesla (other than in index funds) doesn't have to own Tesla stock in some future envisioned scenario to make daily transactions. He can buy the new Chevy Bolt in 2030 with USD both of which benefit from Tesla's rise. He might have missed out on the Tesla growth, but his own $ isn't devalued in the process.

Except this isn't really how it would work out. Both you and ChpBstrd keep alluding to the idea that any transition away from the USD toward bitcoin would siphon away wealth from late adopters, but that isn't true at all. Your cousin who makes $25k a year as teacher would still be making $25k a year. If anything, I would argue that inflation under fiat currency has done way more damage to your cousins' and many others' wealth and wages than any transition away from fiat ever would. Just because someone else has become more wealthy in such an event doesn't mean someone else is getting poorer. Assuming the school your cousin works for continues to pay him the same wages when he transitions to a bitcoin wage, then how has he become poorer?

I'm assuming in this scenario that your cousin doesn't just have a huge stash of cash hidden in his mattress. Most people's future retirement savings is in some kind of equity or real estate and those things will still be productive and valuable in a bitcoin world all the same. The Amazons, Microsofts, Teslas, and Googles in the corporate world will all still be around. Stock investing would suddenly vanish. The idea that these things would suddenly cease production and thus everyone's wealth would vanish is ridiculous.

If there were such a transition where bitcoin became quite dominant, then there would likely be a decent reason for it (the USD value plummted for example). If that's the case, then it should hardly be seen as bitcoin's fault and anyone holding value in dollars still (under their mattress?) would be benefited by moving to bitcoin. Would they be benefited as much as early adopters? Certainly not, but to see flip that situation on its head and call it "siphoning wealth" away from people is quite the stretch.

I also think it is silly to categorize your cousin as the father who is reading to his kids at night and riding bikes with them as if people who own bitcoin don't also do those things.

At the end of the day, claiming that late adopters are "punished" for being late-adopters just simply isn't true. This is especially strange coming from a forum of people who strive to not fall into the "keeping up with the Jones's" trap. Just because your neighbor becomes wealthier for being an early adopter doesn't mean you become poorer for not doing so. You're still living the same life you always did earning the same wages you always have and are still invested in the same productive companies you've always been invested in.

GuitarStv

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Re: What do you think of adding a low% of crypto allocation
« Reply #949 on: February 05, 2022, 08:22:30 AM »
Stable coins (because they don't appreciate) seem like they would answer this critique.

Don't these require a stable Fiat or resource to function? In other words, there wouldn't be a reason for most people to use the stablecoin when they could just own the resource/fiat directly?

The reason that stablecoins exist is that they're a bandaid for the problem that crypto is unusuable as a currency.  Assuming that crypto of some form ever ends up used as a legitimate currency, I'd expect that the demand for stablecoins would drop off quite a bit.