Merged: Bitcoin - Part 3

[ChrisBFRPKY]

Originally Posted by carlitos

Now do UST, TITAN, OUSD, Basis Cash, Digital Dollar, SafeCoin or USDN … or wait 3 months and do USDT.

I suppose I could also send $100 in chickens, but I'd still prefer the USDC transaction.

[a_unique_person]

Originally Posted by psionl0

How well has that worked in China?

Good question. How has it worked?

[The Great Zaganza]

Originally Posted by psionl0

How well has that worked in China?

very well.

[psionl0]

Originally Posted by The Great Zaganza

very well.

Assertion made without evidence and all that.

But even assuming that China has been successful in curtailing cryptos domestically, do we really want a totalitarian regime like China's just so that we can stop other people from trading with bitcoin?

[ChrisBFRPKY]

China's ban did work for about 2 months. Then back to business as usual.

"Bitcoin production roars back in China despite Beijing’s ban on crypto mining"

https://www.cnbc.com/2022/05/18/chin...archers%20show.

[jeremyp]

Originally Posted by psionl0

Can you prove that a ban on bitcoin would be more successful than a ban on drugs?

No, but that doesn't mean we shouldn't be considering it given how bad for the environment it is.

I find it informative that you keep trying to claim that cryptocurrency is similar to poisonous addictive substances that bad for our health and socially destructive.

[jeremyp]

Originally Posted by ChrisBFRPKY

All I know is I've been retired since turning 49 a few years back, almost four years to the day after I began day trading crypto. Bitcoin and other cryptocurrencies were the vehicle that made it possible. My investments went from $300 each to over $60K each at one point. Stock doesn't do that.

The question is where did that $59,700 come from? The answer is it comes from other people buying in. You could only take that $59,700 out because somebody else put it in. These other people will only make money if even more people put money in.

This is the definition of a Ponzi scheme.

[a_unique_person]

That is the interesting thing about prices.

It only takes enough people to buy enough of the product in the market for every one to agree that N amount of a product that was once worth X is now worth X+Y.

However, NxY value wasn't put into that price rise.

[Suddenly]

Originally Posted by psionl0

Can you prove that a ban on bitcoin would be more successful than a ban on drugs?

Internet poker. That's the comp. A huge largely unregulated industry that was effectively decimated worldwide and destroyed in the US by Congress. Not by being directly banned, but by aggressive enforcement of laws banning financial institutions involving same.

I mean, at one point internet poker was so huge that I could buy a significant number of goods and services with a pokerstars balance transfer, so in a way it goes deeper than just the surface comparisons.

So yeah, a similar ban and aggressive KYC enforcement would be if anything more effective because trading in bitcoin isn't exactly recreational much less potentially an obsessive addictive process...

[Dr.Sid]

Originally Posted by jeremyp

The question is where did that $59,700 come from? The answer is it comes from other people buying in. You could only take that $59,700 out because somebody else put it in. These other people will only make money if even more people put money in.

This is the definition of a Ponzi scheme.

Not exactly. Ponzi scheme is different in many aspects. This is simply trade. You get the money by selling something to people who want it, for price which is common at the time.
It's not all that different from commodities. Sure, they have intrinsic value. But only to some extent.
For example gold. It's certainly used as a material in electronics and elsewhere .. but its price is dictated by its scarcity. Gold is also hard to fake, anyone around the world can test if it's genuine, which gives it appeal as a commodity, for storing value or mean of exchange.
If someone came up with cheap way how to make gold though, the price would collapse.
Bitcoin just goes step further, by removing any need for real life use. It still needs the other aspects of commodity though .. it has to be scarce, difficult to fake, easy to test, with global reach.

[psionl0]

Originally Posted by jeremyp

No, but that doesn't mean we shouldn't be considering it given how bad for the environment it is.

Won't somebody please think of the lawyers!

Originally Posted by jeremyp

I find it informative that you keep trying to claim that cryptocurrency is similar to poisonous addictive substances that bad for our health and socially destructive.

Only a soft headed idiot would think that the war on drugs does anything good.

Originally Posted by jeremyp

This is the definition of a Ponzi scheme.

The entire financial derivatives market is more of a ponzi scheme than bitcoin will ever be.

[ChrisBFRPKY]

Originally Posted by jeremyp

The question is where did that $59,700 come from? The answer is it comes from other people buying in. You could only take that $59,700 out because somebody else put it in. These other people will only make money if even more people put money in.

This is the definition of a Ponzi scheme.

Just like Gold

[carlitos]

Originally Posted by ChrisBFRPKY

I suppose I could also send $100 in chickens, but I'd still prefer the USDC transaction.

Originally Posted by carlitos

Now do UST, TITAN, OUSD, Basis Cash, Digital Dollar, SafeCoin or USDN … or wait 3 months and do USDT.

The coins I listed are all “stable” coins that lost their dollar peg and crashed, because in reality they weren’t worth $1. USDFlex is in a death spiral today. Tether is the next big one that will fail. USDC is allegedly the most stable of stablecoins, so rather like the tallest midget.

[carlitos]

Originally Posted by Suddenly

Internet poker. That's the comp. A huge largely unregulated industry that was effectively decimated worldwide and destroyed in the US by Congress. Not by being directly banned, but by aggressive enforcement of laws banning financial institutions involving same.

I mean, at one point internet poker was so huge that I could buy a significant number of goods and services with a pokerstars balance transfer, so in a way it goes deeper than just the surface comparisons.

So yeah, a similar ban and aggressive KYC enforcement would be if anything more effective because trading in bitcoin isn't exactly recreational much less potentially an obsessive addictive process...

Cryptos pull many of the same offshore shenanigans as poker sites did. Key example would be Tether moving from bank to bank to bank before settling at Deltec in the Bahamas. Enforcement and KYC would devastate the industry. It’s not a coincidence that many of the crypto lawyers, Caribbean banks and even financial officers came from online poker.

[psionl0]

Originally Posted by carlitos

The coins I listed are all “stable” coins that lost their dollar peg and crashed, because in reality they weren’t worth $1. USDFlex is in a death spiral today. Tether is the next big one that will fail. USDC is allegedly the most stable of stablecoins, so rather like the tallest midget.

All of the cryptos are in decline ATM. It appears that whatever mechanism is used for "stable" coins doesn't work if the crypto market falls too fast.

[jeremyp]

Originally Posted by Dr.Sid

Not exactly. Ponzi scheme is different in many aspects.

What aspects?

Quote:

This is simply trade. You get the money by selling something to people who want it, for price which is common at the time.

So is a Ponzi scheme. Bernie Madoff got money by selling something to people who wanted to be in his "fund". When people wanted to withdraw money from the fund, he paid them off by using money from people buying into the fund. That's exactly how Bitcoin works. OK, the trades are a bit more direct but that's it.

Quote:

It's not all that different from commodities. Sure, they have intrinsic value. But only to some extent.
For example gold. It's certainly used as a material in electronics and elsewhere .. but its price is dictated by its scarcity. Gold is also hard to fake, anyone around the world can test if it's genuine, which gives it appeal as a commodity, for storing value or mean of exchange.

The purpose of a commodity is not to store value or be a means of exchange. If you can use it for that purpose, that is coincidental.

Quote:

If someone came up with cheap way how to make gold though, the price would collapse.

So what?

Quote:

Bitcoin just goes step further, by removing any need for real life use. It still needs the other aspects of commodity though .. it has to be scarce, difficult to fake, easy to test, with global reach.

So it's not a commodity. It's not a commodity. It's not a currency. What is it? Why the **** do we need it?

[jeremyp]

Originally Posted by psionl0

Won't somebody please think of the lawyers!

Maybe nobody's told you, but there is currently a lot of concern about how much carbon dioxide humans are putting into the atmosphere. The fact that Bitcoin is using as much electricity as the Netherlands is therefore of prime importance.

Quote:

Only a soft headed idiot would think that the war on drugs does anything good.

You are the one saying cryptocurrency is like drugs, not me.

Quote:

The entire financial derivatives market is more of a ponzi scheme than bitcoin will ever be.

What about, what about, what about, what about......

[psionl0]

Originally Posted by jeremyp

What aspects?

That has been explained.
And explained.
And explained.
And explained.
And explained.
And explained.
...
...
...

[jeremyp]

Originally Posted by ChrisBFRPKY

Just like Gold

Except you can sell gold to people who want to make jewellery.

[jeremyp]

Originally Posted by psionl0

That has been explained.
And explained.
And explained.
And explained.
And explained.
And explained.
...
...
...

No. I've seen lots of people telling us it's been explained but I've seen no actual explanations.

[jeremyp]

Originally Posted by psionl0

All of the cryptos are in decline ATM. It appears that whatever mechanism is used for "stable" coins doesn't work if the crypto market falls too fast.

Stable coins aren't supposed to decline - at least, not in comparison to the real currency to which they are allegedly pegged. What use are they if they can collapse when people don't put enough money into cryptocurrency (Ponzi scheme alert) causing the market to "fall too fast"?

Terra/Luna's mechanism failed because the algorithm used was vulnerable to a death spiral scenario. Who knew? Just about everybody who wasn't blinded by crypto-zeal.

Tether will fail because it's run by crooks and the claim that it is backed by USD is outright false. Quite a lot of its backing is "commercial paper" which is unsecured loans.

[psionl0]

Originally Posted by jeremyp

No. I've seen lots of people telling us it's been explained but I've seen no never bothered to read the actual explanations.

ftfy.

Originally Posted by jeremyp

Stable coins aren't supposed to decline - at least, not in comparison to the real currency to which they are allegedly pegged.

I have never believed that claim.

[Captain_Swoop]

Bitcoin is so yesterday.

The big area for scamming at the moment is NFTs in MMORPGs
Check out Earth 2, Archeworld, Metastorm, Ateron and a host of others.

[Samson]

Originally Posted by Captain_Swoop

Bitcoin is so yesterday.

The big area for scamming at the moment is NFTs in MMORPGs
Check out Earth 2, Archeworld, Metastorm, Ateron and a host of others.

In fairness, Bitcoin is permanent, but value indeterminate. Even if market cap descended to 1 billion it would be a triumph for the computer coders.

[Dr.Sid]

Originally Posted by jeremyp

What aspects?

Ponzi scheme usually works with investment and returns, which are taken from investments of new users. No other transaction is possible. Price is fixed. It's centralized. Usually does not have global reach. Usually is not electronic. Usually actually you buy something physical (or service) for you investment. It would be easier to sum what's similar with ponzi scheme: people invest money into it in believe they will make money, while it's clear that most of them won't. Also the fact the investors usually do not understand the mechanism well. And that's about it.

Originally Posted by jeremyp

So is a Ponzi scheme. Bernie Madoff got money by selling something to people who wanted to be in his "fund". When people wanted to withdraw money from the fund, he paid them off by using money from people buying into the fund. That's exactly how Bitcoin works. OK, the trades are a bit more direct but that's it.

The purpose of a commodity is not to store value or be a means of exchange. If you can use it for that purpose, that is coincidental.

Is gold commodity or ponzi scheme then ?

Originally Posted by jeremyp

So it's not a commodity. It's not a commodity. It's not a currency. What is it? Why the **** do we need it?

Why do we need gold ? Why can't you accept it's simply something new ? Something which has features of commodities, also features of currencies, and also has features nothing else has.

[Suddenly]

Originally Posted by carlitos

Cryptos pull many of the same offshore shenanigans as poker sites did. Key example would be Tether moving from bank to bank to bank before settling at Deltec in the Bahamas. Enforcement and KYC would devastate the industry. It’s not a coincidence that many of the crypto lawyers, Caribbean banks and even financial officers came from online poker.

I don't think it's a coincidence that the rise of crypto fits in with the collapse of online poker and an awful lot of long time HODLers are former online poker crushers.

When the UIGEA passed back in 2006 the idea of a internet based currency became a thing in the pokersphere out of concern of the crackdown that finally happened a few years later. It didn't become all that big of a factor as to playing poker because it wasn't all that practical, but that had to be a significant factor in how we got from there to here.

[Dr.Sid]

Well certainly early bitcoin adopters are people who used online money transfer early. In early days people had to get creative to get bitcoin for money, as there were no exchanges. You had to know somebody willing to trade. Or mine it, of course.

[ChrisBFRPKY]

Originally Posted by carlitos

The coins I listed are all “stable” coins that lost their dollar peg and crashed, because in reality they weren’t worth $1. USDFlex is in a death spiral today. Tether is the next big one that will fail. USDC is allegedly the most stable of stablecoins, so rather like the tallest midget.

I'm not a firm believer in the stable coins. I do tend to use USDC routinely though, but I wouldn't want to leave funds converted to USDC long term either.

[ChrisBFRPKY]

Originally Posted by jeremyp

Except you can sell gold to people who want to make jewellery.

That's true! Lots of people use gold to make Jewelry. With bitcoin you're limited to selling it to people who only want to make money. Not very artistic IMO.

[ChrisBFRPKY]

Originally Posted by Dr.Sid

Well certainly early bitcoin adopters are people who used online money transfer early. In early days people had to get creative to get bitcoin for money, as there were no exchanges. You had to know somebody willing to trade. Or mine it, of course.

Exactly. That's what led to Bitcoin Pizza day.

[psionl0]

Originally Posted by ChrisBFRPKY

Exactly. That's what led to Bitcoin Pizza day.

And not long after that, demand for this useless product that has "no intrinsic value" became so great that exchanges sprang up to facilitate their trade.

[Babbylonian]

Originally Posted by psionl0

And not long after that, demand for this useless product that has "no intrinsic value" became so great that exchanges sprang up to facilitate their trade.

Exchanges which now regularly deny people access to their [fake] money. Buy the "dip," suckers!

[psionl0]

Originally Posted by Babbylonian

Exchanges which now regularly deny people access to their [fake] money. Buy the "dip," suckers!

They might deny them access to "fake money" but most give people their bitcoins without trouble.

[Samson]

Just a prediction here.
Bitcoin will slump over a day or so to 18k to 19k

[Dr.Sid]

Originally Posted by Samson

Just a prediction here.
Bitcoin will slump over a day or so to 18k to 19k

Or not .. but I certainly bet on further decline ..

[Solitaire]

Quote:

Energy Costs Soaring, Bitcoin's Price Plummeting by George Glover

Even those larger players don't hold enough bitcoin to meaningfully
move the token's price. But analysts said that some mining companies
could collapse if their profits continue to slump, or if they've taken out
bitcoin-backed loans.

"Many miners took out high-interest loans to fund their mine-to-hold
strategy during the bull market," Sami Kassab, analyst at research
firm Messari Crypto, told Insider. "Some of these companies will face
liquidations and could potentially go under."

All eyes are now on the mining companies that have taken out bitcoin-backed
loans, which is seen as putting them at risk of financial pain. These companies
will likely have to continue selling bitcoin at a discount, according to JPMorgan.

"Offloading of bitcoins by miners, in order to meet ongoing costs or to
delever, could continue into the third quarter if their profitability fails to
improve," a team of JP Morgan strategists led by Nikolaos Panigirtzoglou
said in a note.

If energy consumes 80% of the profits [!] then a 10% rise in energy costs
or a 10% decline in price will wipe out most major players, leaving behind
part time enthusiasts who don't care much about the energy cost.

[psionl0]

Originally Posted by Solitaire

If energy consumes 80% of the profits [!] then a 10% rise in energy costs
or a 10% decline in price will wipe out most major players, leaving behind
part time enthusiasts who don't care much about the energy cost.

Not necessarily. Many may be prepared to operate at a loss for a few years in the expectation of another price recovery.

Even if some get out of mining altogether, the cost of mining will decrease for the remainder and thus they will find it profitable again. So it is unlikely that mining activity will ever decrease to the level of part time enthusiasts only and even if it did, they would find the cost of mining to be quite modest.

[Samson]

Originally Posted by Dr.Sid

Or not .. but I certainly bet on further decline ..

It took 4 days but 19,000 now.
Requiem to 20,000, the worthlessness of the token is becoming apparent. and Charlie and Warren are celebrating with cherry cola.

[Dr.Sid]

Originally Posted by Samson

It took 4 days but 19,000 now.
Requiem to 20,000, the worthlessness of the token is becoming apparent. and Charlie and Warren are celebrating with cherry cola.

It's still 6 times more than March 2020. So nothing really out of ordinary.
Bottoms on logarithmic graph line up quite well since forever. 20 is somewhat bellow that line though.
So as always .. it's either good time to buy .. or the end

[Mycroft]

Originally Posted by jeremyp

So is a Ponzi scheme. Bernie Madoff got money by selling something to people who wanted to be in his "fund". When people wanted to withdraw money from the fund, he paid them off by using money from people buying into the fund. That's exactly how Bitcoin works. OK, the trades are a bit more direct but that's it.

With Bernie, he would pay you with other people's money and tell you he sold some stocks for it.

With Bitcoin, and stocks, bonds and everything else in the economy, for you to sell it someone else needs to buy it, and vise-versa. This is normally an anonymous process, but it is different from a pyramid scheme.