Fiat currency isn't tied to anything. Even if our currency was backed by gold, there is nothing intrinsic about gold either. It's a shiny metal. Tying a currency to it simply serves to prevent a government from unlimited spending since gold itself is limited. Otherwise there would be no point. It also hasn't proved to be doable, long-term, for the obvious reasons. Bitcoin is limited to 21 million coins. The U.S. Dollar isn't limited at all. At some point other countries could stop accepting payment in dollars if the purchasing power of the dollar continues to be debased by unlimited spending. We have an advantage since we are the largest economy and since the dollar, at the moment, is the de facto world reserve currency. That's because oil purchases have to be settled in dollars. Australia, for instance has a public debt to GDP ratio about about 63%, meaning that public (national) debt is about 63% of your GDP. The ratio for the U.S. is about 124%, meaning that our debt is more than our GDP. At what point do people simple refuse to accept payment in dollars? At some point its purchasing power will be reduced to the point that people no longer want the dollar. That doesn't affect Bitcoin, its value can't be debased by an irresponsible governments spending policy. Before it got to the point where no one wanted U.S. government debt, the Treasury would have to raise interests higher and higher to make U.S. debt instruments more appealing. Just like corporate junk bonds. You can imagine that this is just a spiraling problem at that point. The value of everything is controlled by supply and demand. With greater acceptance there is more demand for Bitcoin. The supply is limited so the price goes up. Sure the price goes up and down in the short-run, just like anything else. Over the longer term Bitcoin has been a good investment. With greater adoption that volatility should go down and potential returns should increase at a slower rate. That's the price of greater stability. What is so special about Bitcoin compared to other cryptos? Its supply is limited, it's decentralized, it's super secure which is why it uses the proof of work concept. No one is arguing that trading only results in nothing but "winning". The same would apply to gold, diamonds and any other trading including stocks and real estate. All money is creating something out of nothing including the money you use and rely on. A strength of Bitcoin is that it isn't a tangible asset. It's a digital asset. You can convert your wealth to a form that can be transmitted via the internet without "trusting" any centralized 3rd parties. There is no one that can confiscate your asset. I have said nothing, one way or the other about Bitcoin being "safe" in any way that you are using that term. You keep deriding "clever" traders, "group think", etc. In fact you are behaving, in part, in the same way that you lecture MR about which is either "playing dumb" or refusing to educate yourself on the basics before making overly opinionated statements about a subject that you haven't spent much time attempting to educate yourself about. I'll lump these two together because I'm feeling lazy. Store of value means that if you put your money into something and sell it in 10, 20 years, inflation hasn't eroded its value. People buy real estate and stocks because they can't just put their money in the bank. After some period of time it would be virtually worthless were they to do that. There are no "guarantees" with anything. Your fiat money is pretty much guaranteed to lose value however. Metcalf's Law is the answer to your second point. Not in the engineering sense but it has also come to refer to the value that networking adds to something. It's why you would pay more to own Facebook than to own a newly created "Mediabook". You keep talking about "at least something has some intrinsic use"... You just don't understand, apparently, the utility of Bitcoin and it's beginning to look like you don't want to understand. I don't have any comment about "young people handing their personal data to China"? Regarding Bitcoin vs other crypto, I don't have much to say about other crypto and certainly not about the problems with keeping crypto on exchanges. Other crypto is more like a security and Bitcoin is more like a commodity. The benefits of Bitcoin as a way to store your long-term wealth are that it was specifically designed for this. It's decentralized, limited to 21 million coins, isn't eaten up by inflation or debased by government policy and it's a way to move wealth via the internet. There really isn't another asset class, currently, that does all this. You can't get on a plane and take your real estate with you, you aren't likely to get on a plane with all of your bars of gold, inflation won't eat up all of your wealth over time. Even a "low" rate of 2% inflation will do that. Even owning a business (or stock) isn't likely to be a good choice in 100 years from now. Few businesses are even around and viable that long. It's not a guaranteed source of wealth, nothing is. If you wanted to transfer wealth and have it still be there in a 100 years, I can't think of a better choice. Depending on where you live, it can have even more obvious benefits. Given its current early adoption state, it does require some patience and knowledge of why you are buying it and if you don't have that knowledge (or patience) then it's not a good choice as ignorance, in general, isn't a good choice, IMO.
I think the analogy works in that both provide a service. We may not fully (or at all) understand the value that some find in one service and might fully appreciate the value that others hold in the other service, but I do see them both as service providers. It's not a perfect analogy, but, yeah, okay. The deregulation is actually what many users consider to be a key driver of value. But it's easy to say that with things we don't understand., to just dismiss them as having no value, and thus to be a waste. To you, no, but to others, yes. And of course you don't need to invest in it. Someone without a tv has no need to "invest" in Netflix, for example. It's entirely subjective upon one's view of whether the electricity has been wasted or not. I'm not saying it hasn't been, or that it has. But, yeah, it's a truism that the world would be better off if we hadn't wasted (or continue to waste) electricity on things. It all depends on what we see as a "waste".
It's interesting to consider the ways that most people come to their views on crypto. I initially thought, this is similar to Cabbage Patch Doll or Pet Rock. Later when I heard (2 years ago) that Bitcoin had dropped from $60 to $20, I thought well what do you expect? That's similar to most people's first impressions. It may be this is based on nothing or it may be this is just a Ponzi scheme. Not a lot of thought goes into these comments, it's just one's first impressions. For whatever reason, some finally decide to educate themselves into what exactly is behind this topic. It's common to Google "Bitcoin" and read the definitions and think "OK, I get it, I guess" and then when you start to think about it, you realize that you still don't get it. You can read the definitions but then you think, "So what. What is the actual point?". There is a saying out there regarding Bitcoin that you don't really understand it until you've spent 10,000 hours reading up on the subject. That's a bit extreme but it's true that, like many things, you don't get it without a little effort. Some people make fun of Quantum Physics, who really have spent no time reading a book about the subject. It's the same with Bitcoin. Most people who do spend any time doing the reading/research do, at the least, change their initial reactions. They do at least "get it" whether they buy Bitcoin or not. Many people critique Bitcoin for characteristics that apply to the whole financial system including the money that they are currently using. In other words, not only do they not understand Bitcoin but they don't really understand our current financial system in the first place. The main point I'm trying to make here though is that most people's initial impression of Bitcoin (including mine) was that it was a joke or scam. Most people's opinion changed once they educated themselves a little more.
There are, however, a number of crypto sceptics among those who have fully informed themselves, such as Stephen Diehl, the FT columnist Jemima Kelly, and a number of central banks. The FTX exchange run by this guy Bankrun-Fraud seems to have been using his own tokens as collateral and embezzling like hell. The lack of regulation alone is a serious cause for concern.
Those who are the hardest on crypto seem to be from the traditional banking and finance industry. I don't even bother reading such articles in Forbes and Fortune anymore. Crypt being successful isn't in most of their self interests although I'm sure everyone will adapt at some point (or perish). Of course bad actors are a problem for any industry (FTX). Personally I'm not interested in anything other than Bitcoin, and in anything other than self storage, both of which eliminate most of the issues you are referring to. I'm also always skeptical. I should add that I'm not personally interested in owning anything other than Bitcoin. I do find Ether/Ethereum to be interesting and I'd like to see how that plays out in the future.
FTX was considered, until a few weeks ago, to be one of the most reputable of its kind. But it turns out to be scammier than Enron. That speaks volumes about the standards in the crypto world. Accusing financial regulators of taking a view of crypto motivated by self-interest seems rather ironic, in the circumstances.
FTX, at its core, is/was not a scam. Just because people at the top choose not to abide by the terms of service they set out, and make some poor financial decisions, and possibly illegal ones (I don't know the detail so can't really comment too much), doesn't make the business itself a scam. Any more than the Mirror Group pension fund was a scam just because of the fraudulent behaviour of Robert Maxwell that misappropriated (some of) those funds. The business wasn't set up to steal people's money, which, to me at least, makes FTX itself not a scam. If it turns out FTX was set up to do just that, then, okay, a scam. But until then I question the accuracy of that label.
That had nothing to do with "standards in the crypto world". The Bitcoin ethos would be "not your keys, not your coins". Was Enron about standards in the energy world? My comments about the bankers in the financial sector (not the regulators) was based on reading article after article based on misinformation about crypto, a product that they can't sell and don't generally even understand.
Interesting reading, not really going to put any info about crypto, I might vaguely understand, to any use One aspect caught my attention - There are 21 million Bitcoin in circulation - approx 1 Bitcoin for every 4 people Has 21 Million Bitcoin in circulation been verified somehow? Are they sort of Numbered? Barcoded? QR coded? Interesting sideline reading for me Please Register or Log in to view the hidden image!
Bitcoin isn't a physical coin so there's nothing to barcode. There aren't 21 million in circulation. When they are all "mined" there will be no more than 21 million. In fact, many are "lost".
Same question still applies When all "mined" will it be able to count 21 million around - less those lost? Please Register or Log in to view the hidden image!
The blockchain at the heart of bitcoin will be a ledger of every single bitcoin, detailing it's ongoing transaction history, and the address of every single location it is stored at. (I'm not sure it already records all 21m bitcoin or just those released). Bitcoin is deemed "lost" when those addresses are no longer accessible (lost passwords etc). If you examine the ledger you can know where every single bitcoin is.... All 21 million of them (when they've been mines). At least the addresses, not who owns the address. And many bitcoin will be spread in fractions across many addresses. Each address is something like 27 to 34 alphanumeric characters long. Even if 25, assuming 36 possible options for each character, you're looking at c.10^39 possible addresses. So if you lose the details, if you lose either your address or the key to it, you lose access to all the bitcoin assigned to that address. So keep the details safe!! Please Register or Log in to view the hidden image! It is thought that maybe 20%-30% of bitcoin are lost, and that number will only go up with time.
OK thanks . From such a snippet I am presuming eventually ALL Bitcoin will be lost Please Register or Log in to view the hidden image!
netflix is a subscriber service based on a probable market need for service so i do not understand your comment do you mean the stock/share value of netflix shares ? or the streaming service ? the netflix share value will be linked to the number of netflix subscribers, loosely Disney streaming on the other hand was a poorly executed product
Either. Both. The point is that they offer something that people see value in. The nature of the "service" (subscription, investment, store of value, whatever) is not all that important, if at all, to that point: people see value in it. Hence the analogy between such things as Bitcoin and Netflix would seem to be appropriate. If the comment you don't understand is with regard to how stopping Netflix would be beneficial to the environment, however, then the point is that it's an intentionally fatuous comment: all unnecessary energy use is harmful to the environment (on the assumption that energy production requires some level of burning of fossil fuels) so simply saying, as at least one has argued, that it is unnecessary and therefore a waste of energy thus harmful to the environment is similarly fatuous. Nothing really more to the comment than that.
Only in as much as anything with finite supply that is capable of destroyed/lost rather than always recycled will eventually be lost. Let's say that Bitcoin has been going for 10 years, and 30% has been lost - so let's say that c.3% loss per year... if the loss is constantly at that level then after 100 years there would still be 4-5% left. However, as time goes on, and if it becomes more widespread and accepted, then less should be lost each year, as people begin to appreciate the value of it and learn how to store it more safely and securely. So in time, yes, more will be lost, undoubtedly, but the % lost each year should reduce, quite significantly. Also to note: assuming the use and demand of Bitcoin remains the same, the dwindling supply will itself be inflationary to the value.
