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Old 03-22-2021, 10:27 AM   #101
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Really? It's definitely not a con because there are way too many smart people buying it? That's your basis for judgement? I can show you a lot of smart people who were conned by Bernie Madoff. I can likewise also show you many smart people who say that bitcoin is a con. How about Warren Buffett and Charlie Munger for starters? How about Bill Gates? They're kind of smart.

My personal belief - bitcoin, along with all the cryptos, and now NFTs have taken off because there is too much real money floating around, markets are at all-time highs, and interest rates are at all-time lows.

Cryptos will very likely be part of our future monetary systems - government and central bank controlled cryptos. I'm quite confident that bitcoin will not be any significant part of that future, certainly not for the use case of day to day monetary transactions. And so the question fundamentally becomes "What is it good for"? and "Why bitcoin"?
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Old 03-22-2021, 10:37 AM   #102
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Cryptos will very likely be part of our future monetary systems - government and central bank controlled cryptos.
Bitcoin is attractive to many exactly because it is not government and central bank controlled. I'm guessing that eventually governments will outlaw bitcoin precisely because they can't control it. I have no idea if it that will spell it's demise or not.
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Old 03-22-2021, 10:45 AM   #103
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I have no doubt that government sponsored and controlled crypto will hold tantalizing benefits to government. Imagine not having to fill out tax forms because the government will know the details of your income and how you spent it. There is even the potential for government issued "stimulus" that could only be spent in certain ways. And taxes could be collected automatically. Certainly a lot of things to consider.
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Old 03-22-2021, 10:47 AM   #104
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Bitcoin is attractive to many exactly because it is not government and central bank controlled. I'm guessing that eventually governments will outlaw bitcoin precisely because they can't control it. I have no idea if it that will spell it's demise or not.
The only thing that governments can do is outlawing the interaction with crypto for their respective citizens. Trying to ban bitcoin would be like trying to ban US dollar by governments of Venezuela or Cuba. Or banning drugs....There might be laws passed penalizing owning of or transacting in crypto (India is currently on track of passing such a law) but the genie is out of the bottle.
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Old 03-25-2021, 06:34 AM   #105
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‘Good probability’ the U.S. will outlaw bitcoin: Ray Dalio

https://finance.yahoo.com/video/very...100000280.html
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Old 03-25-2021, 10:39 AM   #106
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help me understand crypto

^^^^^ He’s a lot more cautious and specific in the article than the clickbait Yahoo title implies. I like his distinction between intrinsic value and imputed value. Bitcoin has no intrinsic value, only imputed value.
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Old 03-25-2021, 11:03 AM   #107
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A thought experiment....

What happens when the last Bitcoin has been mined? A. Does the value of every Bitcoin drop to zero? B. Does it go infinite? C. Or does its "value" in terms of purchasing power simply fluctuate with the whims of the market, as it does today?

If the answer is C., how could an employer ever use it as payment to their employees? What employee is going to accept their salary in something that today could buy a nice TV but tomorrow could only buy pork and beans?

And for the same reason, wouldn't McDonalds and every other commercial entity have to immediately convert payments in Bitcoin to dollars?

And if both of the above are true, who the f**k needs Bitcoin?

If the answer is NOT C.... well, that's when (as Warren Buffet might say) the tide goes out and we see who was swimming naked.
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Old 03-25-2021, 11:27 AM   #108
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If the answer is C., how could an employer ever use it as payment to their employees? What employee is going to accept their salary in something that today could buy a nice TV but tomorrow could only buy pork and beans?

To pay in bitcoin, said employer would have to first purchase bitcoin. Any employer doing that w/ their funds designated for salary is taking the same risk, that the value of the account balance would drop before the 'checks' get cut. IOW, they wouldn't. Extremely unlikely scenario you have speculated here.


Very few think of or treat Bitcoin as a payment currency. Makes nice headlines, but the majority of the community has moved on from the idea.
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Old 03-25-2021, 11:32 AM   #109
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BT mining slows down over time. Basically the mining rate halves every 210,000 blocks.

I don't see why C isn't the answer - nothing really changes. Do you have a reason to think otherwise?
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Old 03-31-2021, 01:27 PM   #110
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https://www.marketwatch.com/story/go...rs-11617194916

This is exactly a year later after the same people came out with a paper claiming that bitcoin is not a suitable investments for their clients. If I were one their clients (who missed on the BTC value going up by 600% during that year), I'd fired them.

"First they ignore you, then they mock you, then they fight you and then you win..."
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Old 04-10-2021, 08:30 AM   #111
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The secret to bitcoin and major cryptocurrencies is decentralized finance, otherwise known as Defi. Applications are being written around this and outlawing crypto is not going to be very easy as the valuations gets into the trillions as major corporations are playing in the space and the larger this becomes with more corporations the less likely any outlawing of this will be.

Raoul Pal's insight in October 2020, and he was a fan of crypto long before, in conversations with finance heads he saw so many major players were going to get involved in this space and the future these people anticipated, and you don't just create more bitcoin to meet the demand, the price rises to meet the demand. He utilized the stock to flow model and anticipated a price of $400,000 to $1,000,000 based on his model of demand, the amount being mined and he came up with that price, advertised it for free all over the internet and put 75% of all of his wealth into crypto. Since then prices have more than tripled. I especially enjoyed his comment, "Bitcoin is outperforming everything else on earth and makes everything else pointless, I simply don't care about value versus growth, oh look I can make 10 percent in this asset class while Bitcoin is up 100 YTD.. at this phase in the crypto cycle nothing else matters. There is a wall of money coming in"

I don't think dead people really can provide the critical thinking necessary to try and understand this space any more than 15th Century scholars understood the importance of Christopher Columbus's journeys.

I reccomend this video highly if one would like to try and understand what is happening I think Rauol explains it well.

https://www.realvision.com/shows/dai...&autoplay=true
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Old 04-10-2021, 08:50 AM   #112
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So based on your "dead people" paragraph, I can summarize: this time it's different
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Old 04-10-2021, 08:53 AM   #113
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I would never want to make fun of BTC detractors: we all have the right to form our own opinions about everything, bitcoin included. But for some weekend levity I'm including the link to the Pessimist Archive twitter feed: https://twitter.com/pessimistsarc. It's about "fear of old things when they were new". At the very top we have Einstein blaming automation for economic collapse in the middle of the great depression and a warning about jazz causing increased number of deaths by suicide. If you scroll down you'll find serious statements about the market for home computers ("it doesn't exist") and smallpox vaccine ("it causes insanity").

Although this must be my favorite: https://twitter.com/PessimistsArc/st...59463851671557
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Old 04-10-2021, 09:21 AM   #114
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So based on your "dead people" paragraph, I can summarize: this time it's different
From a moderator I thought did a pretty good job "Dismissive one-liners are not all that helpful."

Bitcoin is a token that has proven that it cannot be hacked and has grown exponentially in use since it's creation in 2008. I believe in constant reevaluation of circumstances as Raoul Pal states in the video but a digital financial world is being developed around the cryptocurrencies, primarily Bitcoin and Ethereum, not learning about a new technology is as old as the world itself and would postulate that the doubters are excluding the evidence and stating that change is not possible because this time the reason things will stay the same is the world is different than before.
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Old 04-13-2021, 04:04 PM   #115
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I believe that although history might not repeat itself, exactly, it will probably rhyme. Learning from dead people (learning from history) is essential. So I guess if there was any dismissing going on, it's the idea that one can't learn from history. I'd say nothing in this world is all that different than things that came before. I don't dismiss bitcoin, I just see it as a tool, like any other fiat currency (albeit this one without government manipulation). Like any other fiat currency, it doesn't create anything. I'm not saying anything about how it's valued. Like anything, if people and entities want it, then it has value. People and entities used to value salt, shells, etc, anything that had a limited supply, could be used to facilitate trade. Same now as then. The value of salt waned, as did shells. Crypto currency "A" might be the best now, but I'm pretty sure that there will be a "B", a "C", etc that take their time as leaders. Hopefully this commentary makes-up for my attempt at humor.
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Old 04-13-2021, 04:19 PM   #116
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I think there is a major misunderstanding of most people of what crypto currency is and how it is going to work. At the top of the blockchain is going to be BITCOIN and Ethereum most likely. Many of the other cryptos work underneath this. You deposit your Bitcoin in exchange for the other currency, while still maintaining ownership and this lets you complete a contract that utilizes another more business friendly token. This is where all the applications are going.

I am unaware of any asset class that has amassed a value of over one trillion dollars and went away. Bitcoin is not a fiat currency, it is a digital asset, not unlike a stock certificate or patent or royalty rights. It is the digital world that is being built around it that is making it more and more valueable.

I don't doubt that many of the minor cryptos could go away, many could soar, but because of how the space is being developed it is very unlikely that Bitcoin or Ethereum will become useless any time soon.

You take a look at why Elon Musk bought Bitcoin. He can deposit the One Billion in Bitcoin, which is now closer in value to two billion and borrow against that digitally to use the gain in the asset without paying any tax. If bitcoin were to hit the price targets its proponents expect of 200-400K Elon is looking at 10-20 billion dollars of capital to use tax free without diluiting shareholder value. This is also why Tesla is soaring up with every day.
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Old 04-13-2021, 04:51 PM   #117
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I believe that although history might not repeat itself, exactly, it will probably rhyme. Learning from dead people (learning from history) is essential. So I guess if there was any dismissing going on, it's the idea that one can't learn from history. I'd say nothing in this world is all that different than things that came before. I don't dismiss bitcoin, I just see it as a tool, like any other fiat currency (albeit this one without government manipulation). Like any other fiat currency, it doesn't create anything. I'm not saying anything about how it's valued. Like anything, if people and entities want it, then it has value. People and entities used to value salt, shells, etc, anything that had a limited supply, could be used to facilitate trade. Same now as then. The value of salt waned, as did shells. Crypto currency "A" might be the best now, but I'm pretty sure that there will be a "B", a "C", etc that take their time as leaders. Hopefully this commentary makes-up for my attempt at humor.
If I were to play devil's advocate, the way you look at history and think of bitcoin could be easily applied to USD: it has value only for as long as people want it. As a classic fiat currency chances are it'll lose most of its value. That process has started and is ongoing.

There is no historical precedence for a fiat currency that has succeeded in holding its value. Twenty percent failed through hyperinflation, 21% were destroyed by war, 12% destroyed by independence, 24% were monetarily reformed, and 23% are still in circulation approaching one of the other outcomes.

The average life expectancy for a fiat currency is 27 years, with the shortest life span being one month. Founded in 1694, the British pound Sterling is the oldest fiat currency in existence. At a ripe old age of 317 years it must be considered a highly successful fiat currency. However, success is relative. The British pound was defined as 12 ounces of silver, so it’s worth less than 1/200 or 0.5% of its original value. In other words, the most successful long standing currency in existence has lost 99.5% of its value. (https://medium.com/compounding-inter...-187c5a806e31#)

”To paraphrase what you wrote: USD as a dominant fiat (reserve) currency might be the best now, but I'm pretty sure that there will be a "B", a "C", etc that take their time as leaders.

I definitely don't expect USD to suddenly disappear into oblivion any time soon. But I also don't believe its fate will be any different from its fiat predecessors. Maybe, just maybe, we are on the cusp of a takeover
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Old 04-13-2021, 04:54 PM   #118
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I figure crypto’s values will be reflected correctly and in the appropriate ratios in my stock index funds, which include Tesla and other companies that incorporate their use, just as stocks engaged in gold, silver, real estate, oil and other “alternatives” already are reflected correctly in my globally-diversified index funds.
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Old 04-13-2021, 06:31 PM   #119
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Tenant16, you make my point perfectly, no devil at all! USD is no better, in principle, than any other fiat currency except that more people want it (believe in it), so it has value. That belief is, if I may speculate, justified by the relatively high rule of law experienced in the US. Lots of people believe in Bitcoin and it's rule of law is encapsulated in the algorithms that make the single, public truth and limited generation of currency possible. Will the USD still be the world's "best" currency when I die? I don't know. It is now, but anything is possible. Will it fall to another country's currency? Maybe. Fall to another, less traditional store of value, like Bitcoin? Maybe.

RM, if you insist Bitcoin is not a fiat currency, we will have to disagree on that point. I agree it's an asset (anything that has value is an asset). I also don't see any fiat currency as the same class as a stock (representing ownership in physical assets and intellectual property) or a bond (a contract with an entity that promises repayment with specific terms).
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Old 04-13-2021, 06:35 PM   #120
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I figure crypto’s values will be reflected correctly and in the appropriate ratios in my stock index funds, which include Tesla and other companies that incorporate their use, just as stocks engaged in gold, silver, real estate, oil and other “alternatives” already are reflected correctly in my globally-diversified index funds.
True. USD held by a corporation is just ones and zeros in their bank. No different than the ones and zeros on the single public truth of the block chain.
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