# Big jump in Bitcoin...



## Brendan Burgess

This wasn't supposed to happen until after I had closed out my short sell position!


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## Leo

Some speculation the jump was triggered by people falling for an April Fools story on the SEC approving a bitcoin ETF.


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## landlord

I assume you won’t sell until it approaches 0 as you predicted. Of course you will maximize your profits by waiting for your price target!!!
Hold on Bren


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## tecate

Leo said:


> Some speculation the jump was triggered by people falling for an April Fools story on the SEC approving a bitcoin ETF.


It very much remains to be seen if this is a tangible move upwards.  However, you have to read everything with a pinch of salt when it comes to the market side of crypto - regardless of whether the story is about crypto going up or crypto going down.  Publications rush to wheel out a reason - and will snatch at any old drivel ..when in reality, they don't know.


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## Brendan Burgess

tecate said:


> you have to read everything with a pinch of salt when it comes to the market side of crypto - regardless of whether the story is about crypto going up or crypto going down. Publications rush to wheel out a reason - and will snatch at any old drivel ..when in reality, they don't know.



Fully agree.  It's the same with the stock exchange report in the newspapers.  Occasionally, they can attribute a share price rise or fall to results, but often there is no reason so they attribute it to "profit taking" or it being "over sold".
Brendan


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## MrEarl

Hi,

Perhaps a concerted effort by a number of the bigger players to start getting the price back up (somewhere close to where it once was) ? 

Lets not forget, a lot of people could be sitting on "paper losses" at the moment, as a result of having bought into Bitcoin at higher prices, so they might be holding (and praying) ... while a number of whales could then start trying to shift the price, by buying at what they consider a low price.

I'm not convinced that this theory could result in the price ever getting back up anywhere near US$20k, but it could have some short term impact, or result in modest occasional increases.


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## tecate

MrEarl said:


> I'm not convinced that this theory could result in the price ever getting back up anywhere near US$20k, but it could have some short term impact, or result in modest occasional increases.


We're probably in an accumulation phase, and there will be a few more 'shakeouts' along the way.  We won't see another all time high until way beyond the next bitcoin halving (probably into 2021).


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## Gus1970

Close that position while you’re ahead, once a wise man said


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## Brendan Burgess

Yeah, pity I didn't close it when it was getting close to my target of $3,000.

I would open up a new position now at $6,000. 

Brendan


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## tecate

Not much chatter on here on the subject over the past couple of weeks.  Probably one of the most significant pieces of news in that time was the announcement by one of the worlds largest asset managers (Fidelity) that it would begin trading of Bitcoin for institutional clients within the next few weeks.  According to a survey they carried out, 22% of institutional investors have some exposure to digital assets whilst 50% are open to gaining digital asset exposure.


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## Andrew365

HODL as they say in Crypto. 

I haven't read much of the Fidelity plans other than the headlines. Is it for all clients i.e. retail investors or just institutional clients and offering access to the Bitcoin Futures? There is obviously massive differences in the route. 

I wouldn't bet against Bitcoin


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## Leo

Andrew365 said:


> Is it for all clients i.e. retail investors or just institutional clients and offering access to the Bitcoin Futures?



Large scale institutional only, no plans for retail operations at this stage.


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## tecate

Leo said:


> Large scale institutional only, no plans for retail operations at this stage.


On the retail side, Etrade and TD Ameritrade are both preparing to offer Bitcoin/Ethereum trading.


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## cremeegg

https://cointelegraph.com/news/hack...ns-in-binance-crypto-exchange-security-breach


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## tecate

cremeegg said:


> https://cointelegraph.com/news/hack...ns-in-binance-crypto-exchange-security-breach


Binance are covering the loss - no users affected.  Of course, crypto custody has to continue to improve.  On the flip side there was $16.7 billion worth of fraud related to credit/debit cards in 2017 so conventional financial services are not immune either.


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## Andrew365

cremeegg said:


> https://cointelegraph.com/news/hack...ns-in-binance-crypto-exchange-security-breach



You post that as a negative? That is not a bitcoin issue that is an exchange security issue. 

The current banking system is defrauded everyday and banks/ corporates spend millions trying to protect themselves and covering losses.


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## Brendan Burgess

Andrew365 said:


> You post that as a negative?



cremeegg

You should know better!  There are simply no negatives to Bitcoin. 

Brendan


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## Andrew365

haha, I wouldn't go that far however that article does not mean there is a flaw with bitcoin, as much as posting an article about bank fraud means there is an issue with fiat currency.


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## Folsom

Surely its just an issue with the exchanges security, and not bitcoin?
If I rip an ATM out of wall using a digger, does that mean there is an issue with fiat currency, or just the security of the ATM?


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## Brendan Burgess

As far as I know, there have not been widespread losses by customers of banks in the ordinary run of business.  Banks have been robbed. And bank customers have been defrauded through fishing.

But Bitcoin owners have lost out a few times due to exchanges going bust or being defrauded. 

So there is a significant difference.

Bitcoin hates regulation - but bank customers benefit from it when things go wrong. 

Brendan


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## tecate

Brendan Burgess said:


> But Bitcoin owners have lost out a few times due to exchanges going bust or being defrauded.  So there is a significant difference.


It's an issue - no doubt.  With the likes of Fidelity now doing custody, the hope would be that this can be improved on.



Brendan Burgess said:


> Bitcoin hates regulation - but bank customers benefit from it when things go wrong.


Bitcoin hates regulation when it remains decentralised.  i.e. if you or I are moving it about - and take responsibility for custody, then any loss is through our own incompetence.
Decentralised exchanges - as they emerge - will also assist here.


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## Leo

tecate said:


> With the likes of Fidelity now doing custody, the hope would be that this can be improved on.



Fidelity will only provide custody services to the institutional players and will be charging for that service, so while likely very secure once there, you'll still face risk with multiple steps required to pass your holdings through the exchanges to to one of the participating institutions, who will in turn transfer to Fidelity. You will have to reverse those steps then if you want to spend your holdings.


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## tecate

Leo said:


> Fidelity will only provide custody services to the institutional players and will be charging for that service, so while likely very secure once there, you'll still face risk with multiple steps required to pass your holdings through the exchanges to to one of the participating institutions, who will in turn transfer to Fidelity. You will have to reverse those steps then if you want to spend your holdings.


Yup, I used Fidelity as an example.  There are more established guys coming into the market who will do custody at a retail level also.


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## Andrew365

The point remains the same, there is no issue with the security of bitcoin, it is security issues with the exchanges. The point about bank customers not losing money is because there is an expectation that banks will cover losses.

Fraudsters exist in every aspect of business.


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## Leo

Yeah, these thefts aren't attacking a weakness in bitcoin itself, but the mechanisms for moving and storing them. These mechanisms are far less secure than the FIAT equivalents such as the SWIFT network. The procedures in place to detect and prevent fraud, but more importantly reverse such transactions are far more advanced in SWIFT. One key challenge with cryptos is that by design, they do not allow for the reversal of transactions, even where it is known such transactions are fraudulent. The ability to respond through legal means is also severely limited.


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## Gus1970

The problem will be fixed when there won’t be any need to sell crypto into fiat


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## Duke of Marmalade

Gus1970 said:


> The problem will be fixed when there won’t be any need to sell crypto into fiat


So you do see crypto achieving zero price in line with its value.


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## EmmDee

Leo said:


> Yeah, these thefts aren't attacking a weakness in bitcoin itself, but the mechanisms for moving and storing them....



Are the mechanisms not a feature rather than a flaw of Bitcoin. They are built into the fundamental design.

Relying on a third party to "hold" your Bitcoin is a compromise in itself - really the only secure way is to hold your own wallet. But that can have it's own risks.


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## Leo

EmmDee said:


> Are the mechanisms not a feature rather than a flaw of Bitcoin. They are built into the fundamental design.



In essence, a little bit of both. So yes, while they are a design feature, the drivers behind those features were to prevent tampering with the blockchain. In the majority of cases, that is a very good thing indeed, however, in the case of fraudulent transactions, if you're the one losing out, it's quite a bad thing. If you were aiming to transform the world of financial transactions, I don't think making it difficult to impossible to deal with fraud would be high up the must-have feature list.



EmmDee said:


> Relying on a third party to "hold" your Bitcoin is a compromise in itself - really the only secure way is to hold your own wallet. But that can have it's own risks.



Yes, of course the only way to really secure it is to hold it in an offline wallet and never expose that to an internet connection. But of course then you can never spend them! Accidentally dispose of, damage the wallet or lose the keys, they're likely gone forever. There are some moves towards creating key-recovery mechanisms, but those aren't without their own significant flaws. Remember, a few nation states are pushing for key recovery mechanisms for surveillance purposes, and crypto advocates tend to push in the opposite direction.


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## Brendan Burgess

Leo said:


> If you were aiming to transform the world of financial transactions, I don't think making it difficult to impossible to deal with fraud would be high up the must-have feature list.



Very well put!


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## tecate

Duke of Marmalade said:


> So you do see crypto achieving zero price in line with its value.


Keep dreaming your Dukeness.  Crypto is here to stay - it isn't going anywhere.


Leo said:


> however, in the case of fraudulent transactions, if you're the one losing out, it's quite a bad thing. If you were aiming to transform the world of financial transactions, I don't think making it difficult to impossible to deal with fraud would be high up the must-have feature list.


In no way is it a good thing for a decentralised crypto to move away from being immutable.  If that is facilitated, then we can forget the whole idea (when it comes to a crypto like Bitcoin at least).   People can custody their own crypto.  It will take a completely different mindset as we've become conditioned to having wealth stored for us.  Funds can be split between cold storage and hot wallets.

Where people see a need for custody, I expect security to become increasingly sophisticated and improved.  Other than that, if you're talking about centralised exchanges, then they should be regulated like any other centralised entity.  There's also no reason why consumer guarantees can't be built in (in the same way as bank guarantees).  That's just for those that want someone else to custody their funds.  People have the option to go either way.

Be aware also that in the U.S. alone, merchants are losing $190 billion in credit card fraud.  Having 90% of the info needed to steal funds written on a credit card is far from a secure system.



Leo said:


> Remember, a few nation states are pushing for key recovery mechanisms for surveillance purposes, and crypto advocates tend to push in the opposite direction.



I bet they are...and there's no damn way they should get that in there.  There will be much more pushback to come from governments on crypto over the next few years.  Last week in the U.S. a democratic congressman sought to introduce a bill to ban cryptocurrency.  His rationale is that it will undermine the U.S. dollar as the reserve currency.  He's not wrong there but that genie is out of the bottle.  They can stifle its development and slow it down but they won't be stopping it.


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## Leo

tecate said:


> In no way is it a good thing for a decentralised crypto to move away from being immutable.



Agreed, that would defeat a key purpose of Bitcoin. But to achieve that you need to accept that such a feature almost completely limits the ability to detect and respond to fraud. 



tecate said:


> Other than that, if you're talking about centralised exchanges, then they should be regulated like any other centralised entity. There's also no reason why consumer guarantees can't be built in (in the same way as bank guarantees). That's just for those that want someone else to custody their funds. People have the option to go either way.



The challenge I see there is that to facilitate such guarantee schemes and regulatory oversight would mean giving governments agencies some degree of control where many crypto advocates very much want to keep them out of the picture completely. 



tecate said:


> Be aware also that in the U.S. alone, merchants are losing $190 billion in credit card fraud. Having 90% of the info needed to steal funds written on a credit card is far from a secure system.



I don't think we should conflate fraud at POS with that within inter-agency systems like SWIFT I mentioned above. But at the consumer point, low level / small volume (less and 0.1%) fraud is an accepted price to be paid for the credit card model, ease of use, scale in the order of 10s of thousands that of Bitcoin, instant, almost universally accepted, low cost transactions, purchase insurance, etc. Even then, the protections offered by the providers mean the consumer very rarely loses out in any of these cases, even where they have been careless themselves. In many cases fraudulent transactions are reversed before the fraudsters can take money out of the system.


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## tecate

Leo said:


> Agreed, that would defeat a key purpose of Bitcoin. But to achieve that you need to accept that such a feature almost completely limits the ability to detect and respond to fraud.


For sure.  It's a case of prevention being paramount rather than cure.  If anyone gets their mits on crypto, more than likely they will have the where with all to spirit it away after that.



Leo said:


> The challenge I see there is that to facilitate such guarantee schemes and regulatory oversight would mean giving governments agencies some degree of control where many crypto advocates very much want to keep them out of the picture completely.


It depends what you mean by control.  When it comes to centralised exchanges, that to me is little different than the conventional world of banks, etc.  In that instance, I'm quite happy that they should be regulated to the same extent.  I guess that could take many forms.  Auditing and reporting to ensure that they have a certain standard of system in place to counter hacking and the same when it comes to liquidity, etc.  If you mean control over the crypto's themselves, that can't happen.  If it does, crypto is compromised and we might as well call it a day.  Just like the point about immutability, key to decentralised crypto is the fact that governments can't tamper with it.

That said, there will be central bank digital currencies (CBDC's) in play pretty soon which will be centralised crypto's.  They can play around with these to their hearts content but they're a completely different beast to decentralised crypto's.



Leo said:


> I don't think we should conflate fraud at POS with that within inter-agency systems like SWIFT I mentioned above. But at the consumer point, low level / small volume (less and 0.1%) fraud is an accepted price to be paid for the credit card model, ease of use, scale in the order of 10s of thousands that of Bitcoin, instant, almost universally accepted, low cost transactions, purchase insurance, etc. Even then, the protections offered by the providers mean the consumer very rarely loses out in any of these cases, even where they have been careless themselves. In many cases fraudulent transactions are reversed before the fraudsters can take money out of the system.



There's no doubt that there's a variance in how exchanges custody crypto.  Some more responsibly than others.   There's also no doubt that due to the nature of crypto, the results can be pretty severe.  As an industry, they're going to have to work together to ensure a certain standard. The space is largely unregulated.  There's been careless practice - although we're already seeing massive improvements over the space of 18 months in terms of the professionalism of the top exchanges.
Accepting all that to be the case, I just wanted to remind people that fraud does happen in systems we are all completely familiar with - in this example, credit card fraud.  As a percentage of overall volume, credit card fraud runs at 0.07% - so it's not an insignificant amount.


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## EmmDee

tecate said:


> ...  As a percentage of overall volume, credit card fraud runs at 7% - so it's not an insignificant amount.



I think that's 7bp i.e. 0.07%


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## Leo

tecate said:


> It depends what you mean by control.  When it comes to centralised exchanges, that to me is little different than the conventional world of banks, etc.  In that instance, I'm quite happy that they should be regulated to the same extent.



And that's where I believe the challenge lays. In order to employ similar regulation, then governments are going to have to introduce legislation on what you can and cannot do with crypto, how transactions are managed and overseen. The level of governance and oversight required goes against what many crypto advocates really want.



tecate said:


> Accepting all that to be the case, I just wanted to remind people that fraud does happen in systems we are all completely familiar with - in this example, credit card fraud.  As a percentage of overall volume, credit card fraud runs at 7% - so it's not an insignificant amount.



Where are you getting 7%? Industry monitors such as the Nilson Report have documented losses of 7 basis points in the past, but that's 0.07%. The 2018 report pointed to 0.01% losses in the US market. 7% would be more than $420B in the US market alone where the number is around $6.5B.

Edit: EmmDee, thinking the same here


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## Duke of Marmalade

Leo said:


> Where are you getting 7%? Industry monitors such as the Nilson Report have documented losses of 7 basis points in the past, but that's 0.007%. The 2018 report pointed to 0.01% losses in the US market. 7% would be more than $420B in the US market alone where the number is around $6.5M.
> 
> Edit: EmmDee, thinking the same here


Leo not sure you have your decimal points in the right place here.  I think 7 bps is .07% as per EmmDee.  Credit Card fraud in UK in 2007 (Wiki) was £535m so I presume in US it is in the $billions.


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## tecate

EmmDee said:


> I think that's 7bp i.e. 0.07%


Yup, you're quite right.  Have edited my post to reflect that 



Leo said:


> And that's where I believe the challenge lays. In order to employ similar regulation, then governments are going to have to introduce legislation on what you can and cannot do with crypto, how transactions are managed and overseen. The level of governance and oversight required goes against what many crypto advocates really want.


Do you mean what exchanges can and can't do with crypto? ...in terms of their systems?  I've no problem with that.  That would  be between the exchanges and the relevant authorities.  However, any demands to change a cryptocurrency itself - that would never end well - and defeats the purpose of going down this road ten years ago.


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## Leo

Duke of Marmalade said:


> Leo not sure you have your decimal points in the right place here.  I think 7 bps is .07% as per EmmDee.  Credit Card fraud in UK in 2007 (Wiki) was £535m so I presume in US it is in the $billions.



one of those days!! I can't highlight an error without making two of my own!   Corrected...


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## Leo

tecate said:


> Do you mean what exchanges can and can't do with crypto? ...in terms of their systems?  I've no problem with that.  That would  be between the exchanges and the relevant authorities.  However, any demands to change a cryptocurrency itself - that would never end well - and defeats the purpose of going down this road ten years ago.



Maybe I'm just cynical, but I think once governments start meddling with regulation in this area, they'll immediately go beyond just ensuring exchanges have appropriate security measures in place to protect against hacking or compromise of the exchange itself and like FIAT impose rules around who can transact with who, etc. that will go against the crypto ethos.


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## tecate

Leo said:


> Maybe I'm just cynical, but I think once governments start meddling with regulation in this area, they'll immediately go beyond just ensuring exchanges have appropriate security measures in place to protect against hacking or compromise of the exchange itself and like FIAT impose rules around who can transact with who, etc. that will go against the crypto ethos.


I have no issue (to a large extent) with regulation of centralised points such as exchanges.  However, I'm not sure how they would stop transactions.  They can force exchanges to lock up peoples funds - but I certainly won't be part of that nonsense.  I had a bank account closed without notice last year - and they wouldn't even give me a reason why.  I'm pretty sure of the reason (because I had the audacity to transfer in funds that came from a crypto exchange) - but wanted them to spell it out.  Not a word from them - and it caused me no end of problems.  If this is the banking model we have going on, I certainly want things in a way that they can't pull This post will be deleted if not edited to remove bad language with my own money. 

It's that that people are trying to move away from and get back their financial sovereignty.  If they take a hard line, then people will just use exchanges for the number of minutes they need to exchange and spirit funds away into a digital wallet.


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## Gus1970

Quite the opposite, but feel free to use confirmation bias


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## Gus1970

Great opportunity for you to make money now, double up your short! Your knowledge will make you whole!


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## elacsaplau

Hey Gus,

Don't you realise that Bitcoin is in a clearly identifiable bubble?


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## Leo

tecate said:


> I had a bank account closed without notice last year - and they wouldn't even give me a reason why. I'm pretty sure of the reason (because I had the audacity to transfer in funds that came from a crypto exchange) - but wanted them to spell it out. Not a word from them - and it caused me no end of problems. If this is the banking model we have going on, I certainly want things in a way that they can't pull This post will be deleted if not edited to remove bad language with my own money.



This isn't the bank making such a decision based on your crypto trading putting their future or FIAT at risk, this is due to regulation and the bank's responsibility in relation to AML. So if you want regulation to protect your interests, you have to accept that the regulators are also likely to impose restrictions that you don't agree with. Financial sovereignty where you get the freedoms to do what you like also comes with significant risk.


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## Gus1970

elacsaplau said:


> Hey Gus,
> 
> Don't you realise that Bitcoin is in a clearly identifiable bubble



Testify


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## EmmDee

Leo said:


> This isn't the bank making such a decision based on your crypto trading putting their future or FIAT at risk, this is due to regulation and the bank's responsibility in relation to AML. So if you want regulation to protect your interests, you have to accept that the regulators are also likely to impose restrictions that you don't agree with. Financial sovereignty where you get the freedoms to do what you like also comes with significant risk.



"Source of funds" - try depositing a suitcase full of bank notes and see how long the bank keeps your account open. The only difference is that with a suitcase full of notes they can refuse it at the counter. With an electronic transfer they can't. The problem is that unexplained large transfers in from a source that doesn't operate AML procedures (i.e. a bitcoin exchange) is exactly the type of behaviour somebody who was money laundering would try to do.

Secondly - they can't tell you anything because if behaviour is suspicious, they are legally barred from raising it to the customer ("tipping off").

It is easy to criticise when we want to do something that seems pretty straightforward and aren't trying to break any laws. But the scale of criminal and terrorist financing looking at ways to work through the banking system dwarves cases like this. And frankly, the Bitcoin exchanges and brokers are not willing to perform anything like adequate KYC checks that would be needed for other financial institutions to trust funds coming from them


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## Leo

EmmDee said:


> It is easy to criticise when we want to do something that seems pretty straightforward and aren't trying to break any laws.



Exactly, and I think most people would happily accept a few trivial speed bumps in such dealings if it made things much more difficult for organised crime.


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## tecate

Leo said:


> Exactly, and I think most people would happily accept a few trivial speed bumps in such dealings if it made things much more difficult for organised crime.


This is where I fundamentally disagree.  The world will not implode if we go back to having the liberty to move our own hard earned funds as we wish.  When it comes to the real movers in terms of organised crime, the conventional banking system caters for them all day long.  Just look at some of the fines dished out in recent months and years to mainstream banks which implicates this.

These are not trivial speed bumps.  Lets think this through for a second.  I've done nothing wrong yet I have FIAT money in the cryptocurrency ecosystem that I can't get out because of some game getting played at another level?  They cut off my access to banking - how is that trivial?  I don't agree with being collateral damage in some dispute that's being played out between third parties.

In the crypto-sphere right now there is an exchange that has (rightly) come in for all sorts of criticisms.  However, whilst I'm not going to defend them on all fronts, at the heart of the issues that have emerged is the fact that they have consistently had banking denied or pulled out from under them.  This has been at the core of decisions they have subsequently made.  This is the experience of practically every exchange on the planet.  

On the culpability of the banks, sure they have AML/KYC regulations to follow and in many instances issues that have arisen lie with regulators, red flags raised elsewhere and their need to comply with regulations.  However, that certainly is not in all cases by any stretch of the imagination.  They've used this as cover to beat down on an emerging crypto economy by cutting off banking to exchanges.  There are multiple examples of same - with legal wranglings in the court systems in most jurisdictions that evidence that.


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## Leo

tecate said:


> This is where I fundamentally disagree.  The world will not implode if we go back to having the liberty to move our own hard earned funds as we wish.



The only time you can do with your money as you wish is, and has always been, when you physically have it in your hands. Since the formation of the banking system, if you choose to use their services, you must abide by their rules. Some of these rules will be set by legislation and regulation, others by the institutions themselves. Banks are service providers, they are entirely free to determine what services they do and do not provide within the constraints of the legal system.

You are right though, the world won't implode, but the goal isn't to stop it imploding, it's to make things difficult for fraud and organised crime. The vast majority of people suffering to any great degree from AML legislation are those who have something to hide. It's true these check don't prevent all fraud, but that is no reason to relax them. Just as blood alcohol limits don't prevent all fatalities, no one is pretending that eliminating or relaxing them would improve the situation.



tecate said:


> These are not trivial speed bumps.  Lets think this through for a second.  I've done nothing wrong yet I have FIAT money in the cryptocurrency ecosystem that I can't get out because of some game getting played at another level?



You're not the only party in the transaction, the other party must also be able to demonstrate they've done nothing wrong. Crypto exchanges find it difficult to impossible to prove this, if they can't do so, it's only proper that they should be blocked from interacting with mainstream banks who have to show compliance. If the bank then has any suspicion whatsoever about your dealings, then their safest course of action is to cut you off. Ask their shareholders would they prefer the bank lose a few customers or risk a compliance finding?



tecate said:


> They cut off my access to banking - how is that trivial?
> 
> I don't agree with being collateral damage in some dispute that's being played out between third parties.



Signing up to a bank as a customer you give them complete authority to treat you as such. Is it not a little ironic that a crypto system that rails against the banking system is so completely reliant on it in certain aspects? If crypto is all it's cracked up to be, why the need to dump it for FIAT at all? Perhaps the bank had read your $20k prediction for YE'21 and are saving you from losing out? 



tecate said:


> They've used this as cover to beat down on an emerging crypto economy by cutting off banking to exchanges.  There are multiple examples of same - with legal wranglings in the court systems in most jurisdictions that evidence that.



That suggests the banks feel significantly threatened by crypto. I haven't seen much to prove that is the case, it's more that crypto just isn't mature enough yet to have full and unfettered access to a heavily regulated banking system.


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## EmmDee

Not sure where to start on this...



tecate said:


> The world will not implode if we go back to having the liberty to move our own hard earned funds as we wish.



If you can do it without checks, so would criminal organisations. And nobody says anything about the world imploding - it is about the ease of operation for large scale criminals.



tecate said:


> When it comes to the real movers in terms of organised crime, the conventional banking system caters for them all day long.  Just look at some of the fines dished out in recent months and years to mainstream banks which implicates this.



Yes - where banks have screwed up they have been fined. But that just highlights how much pressure they are under to actually do it correctly. You can't complain about them applying standards while at the same time pointing out the fines where they have failed to do so. The "conventional banking system" doesn't cater to them - it does get used by them if they can. The non conventional does actually cater to them as it doesn't apply any checks. There was a reason Silk Road used Bitcoin. 



tecate said:


> These are not trivial speed bumps.  Lets think this through for a second.  I've done nothing wrong yet I have FIAT money in the cryptocurrency ecosystem that I can't get out because of some game getting played at another level?  They cut off my access to banking - how is that trivial?  I don't agree with being collateral damage in some dispute that's being played out between third parties.



It's not a dispute (other than between you and the bank). If you were planning to transfer significant funds out of the blue from a bitcoin exchange, I would have contacted them in advance, discussed the source of the funds and shown backup. I sold a car once for cash - I called the branch beforehand and explained what I was doing and why I would be lodging a significant amount of cash. As a rule of thumb, anything unusual over €10k should be checked out. 



tecate said:


> In the crypto-sphere right now there is an exchange that has (rightly) come in for all sorts of criticisms.  However, whilst I'm not going to defend them on all fronts, at the heart of the issues that have emerged is the fact that they have consistently had banking denied or pulled out from under them.  This has been at the core of decisions they have subsequently made.  This is the experience of practically every exchange on the planet.



Exchanges and similar businesses (e.g. Money Transfer Bureaus such as Western Union) have to go through enhanced diligence to sort out their banking needs because there is a higher risk of misuse. They all do it. If the exchange you're referring to can't do it, then it's probably because they don't have control over their business. That's their responsibility not any banks. If they want to play at being cowboys then that's their choice.   



tecate said:


> They've used this as cover to beat down on an emerging crypto economy by cutting off banking to exchanges.  There are multiple examples of same - with legal wranglings in the court systems in most jurisdictions that evidence that.



So... this is fundamentally the lack of understanding. Banking makes no money on cash. No bank is particularly tied to any currency. Physical cash is an expensive overhead that makes no revenue. Banking is about trading risk (understanding it, managing and trading it) - that's fundamentally what banks do. Financing, lending, swapping (currencies, interest rates etc) is essentially about risk. Banks would be all over crypto if it was possible meet regulatory requirements and perform AML and KYC. It's just another currency


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## EmmDee

It seems I wasn't the only one shaking his head


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## tecate

Leo said:


> The only time you can do with your money as you wish is, and has always been, when you physically have it in your hands. Since the formation of the banking system, if you choose to use their services, you must abide by their rules. Some of these rules will be set by legislation and regulation, others by the institutions themselves. Banks are service providers, they are entirely free to determine what services they do and do not provide within the constraints of the legal system.


I don't disagree with that.  The point is I don't like their damn rules and want out (and there are plenty that share that view even if not so much on AAM).  i can't get out until there's enough momentum towards crypto.



Leo said:


> You are right though, the world won't implode, but the goal isn't to stop it imploding, it's to make things difficult for fraud and organised crime. The vast majority of people suffering to any great degree from AML legislation are those who have something to hide. It's true these check don't prevent all fraud, but that is no reason to relax them. Just as blood alcohol limits don't prevent all fatalities, no one is pretending that eliminating or relaxing them would improve the situation.


I think we underestimate organised crime.  These guys can cut through this like butter.  My experience in recent times has been that it's a major drag to the point at which I can't twist or turn.  I have friends that are heavily involved in crypto with exactly the same experience -having to take very complex routes to organise their finances.  
Crime can be fought in many ways - it doesn't have to involve disrupting peoples lives in doing so.



Leo said:


> You're not the only party in the transaction, the other party must also be able to demonstrate they've done nothing wrong. Crypto exchanges find it difficult to impossible to prove this, if they can't do so, it's only proper that they should be blocked from interacting with mainstream banks who have to show compliance. If the bank then has any suspicion whatsoever about your dealings, then their safest course of action is to cut you off. Ask their shareholders would they prefer the bank lose a few customers or risk a compliance finding?


The largest crypto exchanges are implementing AML/KYC as best they can.  However, cryptocurrency is not always conducive to such policies.  That's the nature of it.  I'm not the only party to a transaction but its me that bears the brunt from this policy.  There is nothing suspicious about my dealings.  In this instance it's to do with efforts to smother a particular exchange.  



Leo said:


> Signing up to a bank as a customer you give them complete authority to treat you as such. Is it not a little ironic that a crypto system that rails against the banking system is so completely reliant on it in certain aspects? If crypto is all it's cracked up to be, why the need to dump it for FIAT at all? Perhaps the bank had read your $20k prediction for YE'21 and are saving you from losing out?


We all inherited the systems we have.  It's not realistic to expect a crypto economy to develop in a vacuum without interaction with the pervading FIAT based economy.  As regards my need to 'dump' it info FIAT, as per discussions on here, its widely known that crypto is volatile and a nascent technology and accompanying market.  It wouldn't be prudent to leave all my assets in crypto.  
Interesting line of thought though - that the bank have a highly developed empathetic side   ...and are trying to save me from myself. 

Everything is possible - particularly when it comes to crypto/blockchain and how it may develop.  However, as it stands today, I've put my money where my mouth is on the basis that my prediction is closer to reality than the suggestion of Bitcoin having a valuation of zero within the next couple of years.  So I'm backing it - but I'm sure you'll understand if I don't put every cent I have on it (or anything else for that matter).



Leo said:


> That suggests the banks feel significantly threatened by crypto. I haven't seen much to prove that is the case, it's more that crypto just isn't mature enough yet to have full and unfettered access to a heavily regulated banking system.


Don't have time to dig them out yet but there are court actions worldwide to prove this.  There are actions by state agencies that deal with anti-competitive practices that prove it also.  The blockchain/crypto progressive state of Wyoming had to pass specific legislation to ensure that blockchain/crypto businesses in the state will have access to banking facilities.  In doing so, they acknowledged the absolute difficulty startups were having in this respect.  The bill was passed - and the only dissenting voices were from the ...banking community.


----------



## tecate

EmmDee said:


> If you can do it without checks, so would criminal organisations. And nobody says anything about the world imploding - it is about the ease of operation for large scale criminals.


We've had this with so many things in the past.  Paedos use the internet - but its not a reason to block the internet (yet back in the day when the web was new, that's the sort of rubbish that was bandied about).  The very same nonsense is being talked of - with crypto....yet normal everyday people can benefit from it.
Let law enforcement chase the bad guys - but locking my funds (as paypal did recently on my account) or leaving me without a way to access banking (as one bank did recently) is not acceptable.  I know you guys believe its a necessary evil - but I disagree.  When the cartels need to launder on a grand scale, they have the cooperation of mainstream banking.  Ask Danske and HSBC.



EmmDee said:


> Yes - where banks have screwed up they have been fined. But that just highlights how much pressure they are under to actually do it correctly. You can't complain about them applying standards while at the same time pointing out the fines where they have failed to do so. The "conventional banking system" doesn't cater to them - it does get used by them if they can. The non conventional does actually cater to them as it doesn't apply any checks. There was a reason Silk Road used Bitcoin.


Yes, it does and it has!  You think HSBC weren't catering for the cartels?  How many HSBC executives were imprisoned for that faciliatation (on an epic scale)?  If you're not aware of the case, just google HSBC and cartel.

As regards silk road and bitcoin, see above.  There's no point throwing the baby out with the bathwater.  If I want to use bitcoin for wholesome purposes, I shouldn't be excluded from using it because someone else uses it for illicit purposes.



EmmDee said:


> It's not a dispute (other than between you and the bank). If you were planning to transfer significant funds out of the blue from a bitcoin exchange, I would have contacted them in advance, discussed the source of the funds and shown backup. I sold a car once for cash - I called the branch beforehand and explained what I was doing and why I would be lodging a significant amount of cash. As a rule of thumb, anything unusual over €10k should be checked out.


You're making assumptions there.  I opened the bloody account with them on the sole basis that I WOULD be transferring funds gained via crypto into said account.   Over and above that, there is a wider dispute between the exchange and other parties - that led to this - but that shouldn't be my problem. 



EmmDee said:


> Exchanges and similar businesses (e.g. Money Transfer Bureaus such as Western Union) have to go through enhanced diligence to sort out their banking needs because there is a higher risk of misuse. They all do it. If the exchange you're referring to can't do it, then it's probably because they don't have control over their business. That's their responsibility not any banks. If they want to play at being cowboys then that's their choice.


There isn't an exchange on this planet that hasn't had banking difficulties.  Nor has that changed - right now as we speak, there are a world of difficulties in terms of banking services and exchanges.  As regards exchanges and control of their business, its a nascent technology and market - that remains partly regulated.  Sure, there are cowboys - but there are also very professional exchanges.  It doesn't matter what they do, every single one of them has the same difficulty despite how closely they try to follow this AML/KYC crapshow.



EmmDee said:


> So... this is fundamentally the lack of understanding. Banking makes no money on cash. No bank is particularly tied to any currency. Physical cash is an expensive overhead that makes no revenue. Banking is about trading risk (understanding it, managing and trading it) - that's fundamentally what banks do. Financing, lending, swapping (currencies, interest rates etc) is essentially about risk. Banks would be all over crypto if it was possible meet regulatory requirements and perform AML and KYC. It's just another currency


Correct in cases and not correct in others.  There are plenty of examples of actions being taken against bank for anti-competitive practices when it comes to crypto.  Don't have time to dig them out right now but google it if youre curious.


----------



## Leo

tecate said:


> I don't disagree with that.  The point is I don't like their damn rules and want out (and there are plenty that share that view even if not so much on AAM).  i can't get out until there's enough momentum towards crypto.



I think the issue really is you got out, but now want to move your holdings back in under their rules. I don't see it getting any easier to do so any time soon. I don't see the upside for any major bank, particularly in the Irish market in taking that risk. 



tecate said:


> I think we underestimate organised crime.  These guys can cut through this like butter.  ...
> Crime can be fought in many ways - it doesn't have to involve disrupting peoples lives in doing so.



Some can, the vast majority can't. If it were so easy you wouldn't see sophisticated muti-national organisations stockpiling cash and heavily invested in physical assets and costly money laundering schemes. As I said above, AML rules are invisible to the vast majority of people, this is an edge case, and does not justify a relaxation of the rules. 



tecate said:


> I'm not the only party to a transaction but its me that bears the brunt from this policy.  There is nothing suspicious about my dealings.



I get that, but the bank have significant responsibilities beyond ensuring you are above board. They need to be able to follow the money. You're only suffering because you choose to deal with an entity that cannot satisfy the criteria for engaging with our banks. 



tecate said:


> It's not realistic to expect a crypto economy to develop in a vacuum without interaction with the pervading FIAT based economy.



This is a challenge the crypto world may need to solve if it wants to thrive. It will continue to be easy to buy into crypto, but to cash out and move back to FIAT, you will always need to play by their rules. Longer term, this might be a good thing for crypto, for it to thrive, perhaps people need to focus less on the ability to divest and more on the challenges preventing its broader adoption. 



tecate said:


> Interesting line of thought though - that the bank have a highly developed empathetic side   ...and are trying to save me from myself.



Very much tongue in cheek, I'm certainly not going to pretend your or my interests come anywhere close to even making it onto their priority list. 



tecate said:


> Everything is possible - particularly when it comes to crypto/blockchain and how it may develop.  However, as it stands today, I've put my money where my mouth is on the basis that my prediction is closer to reality than the suggestion of Bitcoin having a valuation of zero within the next couple of years.  So I'm backing it - but I'm sure you'll understand if I don't put every cent I have on it (or anything else for that matter).



Yep, wise move. I don't think it'll drop to zero soon either, but I still see too many downsides that suggest to me Bitcoin isn't the future of crypto.


----------



## EmmDee

tecate said:


> As regards silk road and bitcoin, see above.  There's no point throwing the baby out with the bathwater.  If I want to use bitcoin for wholesome purposes, I shouldn't be excluded from using it because someone else uses it for illicit purposes.



This is - in some ways - the nub of the issue. How does a bank tell the difference between a wholesome guy (like you) and someone who isn't when the exchanges from where the money is transferred won't (or can't) differentiate.

You can quote all the banks having been done for money laundering but it really makes my point. The banks are in jeopardy (institutionally and personally) if they don't demonstrate proper efforts to identify and stop illegal activity. The exchanges aren't and therefore don't. I think you significantly underestimate the level of AML monitoring going on in the banks. Let's say - if I wanted to launder money I wouldn't walk up to a bank and open an account


----------



## tecate

Leo said:


> I think the issue really is you got out, but now want to move your holdings back in under their rules. I don't see it getting any easier to do so any time soon. I don't see the upside for any major bank, particularly in the Irish market in taking that risk.


Yes, for that reason, Irelands only proper crypto exchange have had banking withdrawn by three irish banks and now have to go overseas for their banking needs.  The irony here is that governments need to make their minds up.  Either they ban crypto or they embrace it and implement new regulations that are geared towards it (and the same with securities law).  AML/KYC were built for conventional banking services and not for this new market.



Leo said:


> Some can, the vast majority can't. If it were so easy you wouldn't see sophisticated muti-national organisations stockpiling cash and heavily invested in physical assets and costly money laundering schemes. As I said above, AML rules are invisible to the vast majority of people, this is an edge case, and does not justify a relaxation of the rules.


An edge case but not for anyone with the most basic of dealings in the crypto economy.  See above.  They need to come to a decision - either ban it or embrace it.



Leo said:


> I get that, but the bank have significant responsibilities beyond ensuring you are above board. They need to be able to follow the money. You're only suffering because you choose to deal with an entity that cannot satisfy the criteria for engaging with our banks.


Not much in the way of choice.  I 'chose' one because it was the only one available to me with a particular type of FIAT off-ramp (that I had to have).  There seems to be a particular hard on for this particular exchange.  However, having spoken to many in crypto circles, the experience is always the same.  It doesn't matter what exchange it is.  The reality is that governments, bureaucrats and politicians (like the Democrat Rep. from California last week that tried to table a bill to have crypto banned) don't know what they're doing or how to 'manage' it.



Leo said:


> This is a challenge the crypto world may need to solve if it wants to thrive. It will continue to be easy to buy into crypto, but to cash out and move back to FIAT, you will always need to play by their rules. Longer term, this might be a good thing for crypto, for it to thrive, perhaps people need to focus less on the ability to divest and more on the challenges preventing its broader adoption.


Crypto is the upstart - so it's very difficult.  You can't have crypto/blockchain startups operate without banking facilities.  If they truly frustrate it, then it will go underground and any chance they have at controlling it at that point will be gone.  Not that that would be good for anyone in crypto - but it could be a lose/lose in the long term for all concerned.
That said, its one of the reasons stablecoins have emerged.  If the crypto economy can grow to a certain basic level, then there wont be the same burning need to exchange between the two.  It's the growing pains in the meantime involved in that happening...will take a good bit more time yet.



EmmDee said:


> You can quote all the banks having been done for money laundering but it really makes my point. The banks are in jeopardy (institutionally and personally) if they don't demonstrate proper efforts to identify and stop illegal activity. The exchanges aren't and therefore don't. I think you significantly underestimate the level of AML monitoring going on in the banks. Let's say - if I wanted to launder money I wouldn't walk up to a bank and open an account


Whilst there has also been some anti-competitive practice, I don't disagree with what you're saying.  I just fundamentally don't agree with measures that make things intolerable for ordinary people.  Having said that, I accept that most people are oblivious to it - but its still not the point.  Separate regulation is required.


----------



## Duke of Marmalade

Leo said:


> This is a challenge the crypto world may need to solve if it wants to thrive. It will continue to be easy to buy into crypto, but to cash out and move back to FIAT, you will always need to play by their rules.


Maybe I see an explanation for the recent upsurge in price.  If it is easy to buy, but to sell you have to comply with conventional rules, which is almost against a crypto’s religion then that would be a massive distortion in supply/demand.  

Really only two other possible reasons for the price surge 
1.  A sudden jump in the demand to buy lattes with crypto. or 
2.  Renewed speculation that the price will soar  If this then  I have the supplementary question: what is fueling this speculation?


----------



## EmmDee

Duke of Marmalade said:


> Maybe I see an explanation for the recent upsurge in price.  If it is easy to buy, but to sell you have to comply with conventional rules, which is almost against a crypto’s religion then that would be a massive distortion in supply/demand.



Actually when you think about it, unless you mine coins, the funds to buy coins come from the regulated cash infrastructure. So the brokers and exchanges benefit from the checks, balances and infrastructure of the traditional payments industry. They just don't want to put the effort into doing their own work going the other way so there are problems sending it back into that infrastructure.

If the brokers and exchanges performed similar KYC on their clients and performed the same monitoring and compliance with AML, then it wouldn't be (as much of) an issue. Western Union or similar MTB's had a very similar challenge - people walking into offices with cash and transferring it to people across the banking infrastructure. They had similar problems with banks stepping away from it. They resolved it to some extent (though not without difficulty) by gathering and checking documentation on the people coming into the offices and performing checks against sanctions and AML lists


----------



## tecate

Duke of Marmalade said:


> Maybe I see an explanation for the recent upsurge in price.  If it is easy to buy, but to sell you have to comply with conventional rules, which is almost against a crypto’s religion then that would be a massive distortion in supply/demand.


Ok, I'll address the 'crypto's religion' bit first.  It seems its against the 'conventional religion' - as its them objecting with us using their services....so that's the 'religion' jibe dealt with  
As regards this difficulty being a reason, well it's always been a difficulty from the very beginning...so makes no difference.

So, the reasons for the uptick....

- Conventional markets have tanked with the trade war fallout.  Guys in equity were scrambling for options in terms of where to put their capital - and Bitcoin became part of that narrative.

- Bakkt - the futures market which has been set up by the NYSE - came out and said that they will commence offering physically settled Bitcoin futures in July.  This is a big deal.  We already have futures - but not physically settled futures - and that will have an effect on the market.  Bakkt are collaborating with Microsoft and Starbucks on this - so it's significance goes beyond futures in terms of what is planned.  That said, this has been delayed already by many months and there's a good chance that it won't make July either.

- Fidelity (one of the worlds largest asset managers) came out and said that they'd be trading crypto for their clients within the next few weeks.

- At Consensys (New York Blockchain Week event), promotional material emerged that suggested that Ebay would start accepting bitcoin as payment.  We have pics of the promotional material yet no denial or acknowledgement from Ebay.  Make of it what you will.

- Indirectly (through a particular payment processor) - Starbucks, Whole Foods, Bed Bath n Beyond and a number of other U.S. retail chains are now accepting Bitcoin as payment.   Whole Foods is a major nationwide chain and owned by Amazon.

- The Halving.  Next year, the reward that miners receive will be cut in half - as happens every 4 years.  In the lead up to this, Bitcoin price always rises as the scarcity of the cryptocurrency intensifies.

- Whilst everyone was watching the crypto market car crash in 2018, people in the industry were focused on building it out.  There has been plenty of good work done in the space (albeit there's plenty still to be done in every respect).

Take your pick.  In terms of the rush right now, I would be inclined towards the first one - with some influence from the others.



Duke of Marmalade said:


> 2. Renewed speculation that the price will soar If this then I have the supplementary question: what is fueling this speculation?


All of the above.


----------



## EmmDee

tecate said:


> Separate regulation is required.



I agree that the nature of regulations may need to be different but it would have to achieve the same thing - who is initiating a transfer, who is receiving it, scrub names against sanctions lists, monitor unusual transactions and report them. If these aren't achieved but it is still plugged into the mainstream infrastructure then it just becomes a massive loophole


----------



## tecate

EmmDee said:


> I agree that the nature of regulations may need to be different but it would have to achieve the same thing - who is initiating a transfer, who is receiving it, scrub names against sanctions lists, monitor unusual transactions and report them. If these aren't achieved but it is still plugged into the mainstream infrastructure then it just becomes a massive loophole


Well, they may as well move directly to a blanket ban (if they consider that a wise move) - as Bitcoin by its very nature is at least pseudo-anonymous (and can be fully anonymous with the right approach).  Who is initiating a transfer and receiving a transfer - well, they can use (and are using) specialized software in order to chase that.  However, people are not going to willingly provide that info.  It's one of the fundamentals of decentralised cryptocurrency.  And of course, there-in lies the problem.  They (governments and government agencies) simply have to make their minds up as to how they're going to deal with this.


----------



## EmmDee

tecate said:


> Well, they may as well move directly to a blanket ban (if they consider that a wise move) - as Bitcoin by its very nature is at least pseudo-anonymous (and can be fully anonymous with the right approach).  Who is initiating a transfer and receiving a transfer - well, they can use (and are using) specialized software in order to chase that.  However, people are not going to willingly provide that info.  It's one of the fundamentals of decentralised cryptocurrency.  And of course, there-in lies the problem.  They (governments and government agencies) simply have to make their minds up as to how they're going to deal with this.



Well - not so much. It just means it can't easily convert to  currency on the banking infrastructure. It could happily exist anonymously with no regulation as a "walled garden". Likewise we could choose to use stones between us as a value token. Doesn't need to be regulated at all - can be ignored. The problem occurs when we want to switch to currency.

Which brings us to your original problem... you wanted to get out of Bitcoin. But a bit like any other investment, there are risks involved which need to be understood when going in. It seems one of the risks of Bitcoin is liquidation risk. You like the benefits of Bitcoin but are blaming others for the disadvantages of it


----------



## Duke of Marmalade

_tecate_ I am not convinced by your explanations of the “uptick”
Panicking equity investors: No.  If there was panic about the value of FIAT currencies, yes that might explain things.  But equity investors are not in a panic about the value of the currencies.  In times of panic there is a flight to safety - bitcoin ain’t safe.
The Halving:  the supply of bitcoin is controlled and everybody knows what it will be in the future.  There is no new development here and so no reason for a “uptick”.  In fact the scarcity is not increasing, it is decreasing.  There are 16.7m bitcoins in supply now and there will be more next year
Big names accepting bitcoin:  Are they really?  Will Starbucks really be pricing in bitcoin? Or as a marketing gimmick will they be setting up an interface which converts bitcoin at the going rate to dollars?
Maybe developments on the futures exchanges are having an influence, I remember that was behind the surge in 2017. I’ll buy that one but does it really explain a 100% jump?


----------



## Brendan Burgess

Duke of Marmalade said:


> Really only two other possible reasons for the price surge
> 1. A sudden jump in the demand to buy lattes with crypto. or
> 2. Renewed speculation that the price will soar If this then I have the supplementary question: what is fueling this speculation?



It wasn't much different with the dot.com bubble.  There was no connection between the price of the shares and the underlying performance of the company.  It was very old fashioned to dare suggest that there had to be such a relation. 

But prices went up and down fuelled by any rumour or development.  "Fyffes is about to add .com to their name" share price starts rising. Most of us knew it was irrational, but couldn't really profit from it. 

Bitcoin has an advantage over hypervalued shares.  With shares you can point out that the price is a multiple of the revenues and the company has little prospect of making profits.  Bitcoin doesn't face that restriction - there is nothing on which to base the valuation.

We know it's worth zero.  Absolute zero and, in time, its price will match its value. But it has survived much longer than I expected. Will it crash to zero before the end of 2019? I thought it would have gone most of the way by the end of last year, but it didn't. 

But at some stage it will go to zero - hopefully, it doesn't rise above my close out limit before then.

Brendan


----------



## tecate

EmmDee said:


> You like the benefits of Bitcoin but are blaming others for the disadvantages of it


I'd like there to be clarity.  Because what we are saying is that banks don't cash out funds that emanate from a cryptoexchange -full stop.  Let them all come out and say that then. 

I opened up a bank account on the explicit basis that I would be financing it through cryptocurrency - that was what was explained to them.  If they had an issue with it on opening, that was the time to disclose it.   The very same with all the exchanges that have set out on that basis - only for banks to later pull the rug out from under them when they were in the middle of meeting the needs of customers. 
That 'disadvantage' is being imposed by regulators and banks - it comes from them and of course I will blame them for it.  The suggestion seems to be that conventional systems can't be changed - they can and they should.  But otherwise, you're right.  The crypto-space will overcome those difficulties one way or another.


----------



## tecate

Brendan Burgess said:


> It wasn't much different with the dot.com bubble.  There was no connection between the price of the shares and the underlying performance of the company.  It was very old fashioned to dare suggest that there had to be such a relation.
> 
> But prices went up and down fuelled by any rumour or development.  "Fyffes is about to add .com to their name" share price starts rising. Most of us knew it was irrational, but couldn't really profit from it.
> 
> Bitcoin has an advantage over hypervalued shares.  With shares you can point out that the price is a multiple of the revenues and the company has little prospect of making profits.  Bitcoin doesn't face that restriction - there is nothing on which to base the valuation.
> 
> We know it's worth zero.  Absolute zero and, in time, its price will match its value. But it has survived much longer than I expected. Will it crash to zero before the end of 2019? I thought it would have gone most of the way by the end of last year, but it didn't.
> 
> But at some stage it will go to zero - hopefully, it doesn't rise above my close out limit before then.
> 
> Brendan


Respectfully, the only possibility of it dying away is if another cryptocurrency manages to get out in front of it in every respect.  Otherwise, it's not going to zero.  New technologies and markets come with hype cycles - and there's no doubt there's more than an element of that involved here.   Markets may be irrational and this one often is.  But then Bitcoin has been declared dead and buried umpteen times.


----------



## Folsom

tecate said:


> But then Bitcoin has been declared dead and buried umpteen times.



That is very interesting. Im wondering however, if so many people of reasonable intelligence and of reasonable influence cannot understand bitcoin, its mechanics, its draw, etc, then isnt that a big problem for bitcoin?


----------



## tecate

Folsom said:


> That is very interesting. Im wondering however, if so many people of reasonable intelligence and of reasonable influence cannot understand bitcoin, its mechanics, its draw, etc, then isnt that a big problem for bitcoin?


In terms of its use as a day to day transactional currency, certainly.  There's a volume of work to be done to make it easier to use.  We've had the same with many technologies in the past.  For example, getting email from a point where only geeks could manage it to the point where your granny could use it took some time.

As a store of value (and many will dispute its development as a store of value), its still a difficulty but there are plenty of people who can use it as a store of value and custody it themselves or have someone else custody it.  That I also expect to be made more customer friendly as we progress.


One other thing to bear in mind.  Cash is going - it's just a matter of the timeframe.  Sweden is almost cashless already.  However, they have long since had a project open with a view towards launching a central bank digital currency (CBDC).  As someone who comes from the perspective of decentralised crypto, a centralised digital currency isn't very interesting to me.  However, from the perspective of conditioning people into using a digital currency, then it's highly significant.


----------



## Duke of Marmalade

Folsom said:


> That is very interesting. Im wondering however, if so many people of reasonable intelligence and of reasonable influence cannot understand bitcoin, its mechanics, its draw, etc, then isnt that a big problem for bitcoin?


Au contraire.  There are of course the nerds who understand it and love it for its aesthetic beauty.  There are also the religious zealots who see it as fingers to the financial order.  But my guess is that speculative surges such as we see now are driven by neither of these constituencies but by folk who haven’t a clue what it is but are ready to pounce on the least sign that the price might go sky rocketing.  Now if these latter folk really did understand how crypto worked and in fact how crude a technology it is they wouldn’t touch it with a barge pole.


----------



## tecate

Duke of Marmalade said:


> Au contraire.  There are of course the nerds who understand it and love it for its aesthetic beauty.  There are also the religious zealots who see it as fingers to the financial order.


I see.  So these institutional investors who are getting involved in the market are religious zealots?  The pension fund managers that have added crypto to their portfolios, the same?
There are all sorts of folk implicated with cryptocurrency and blockchain right now.  Yes, some approach from the perspective of crypto and blockchain with a view towards it providing a mechanism to help to advance society in various ways.  Only a blind man can't see that the technology has such attributes and the potential to benefit society provided its correctly implemented.

As regards the 'religious zealot' jibe, having had this debate/discussion with you many times, yours is just as much an entrenched view as I've found amongst no-coiners.  The zealotry cuts both ways.




Duke of Marmalade said:


> But my guess is that speculative surges such as we see now are driven by neither of these constituencies but by folk who haven’t a clue what it is but are ready to pounce on the least sign that the price might go sky rocketing.


There's a hype cycle associated with any form of promising new technology.  We see the same with AR/VR/AI.  As regards this recent uptick - the reasons I provided you with above cover it.  Do people sit up and take notice, then FOMO in afterwards?  Sure.  Greed is part of the human condition.  It may be especially on show in this market - but it's to be seen in every other market too - to varying extents.



Duke of Marmalade said:


> Now if these latter folk really did understand how crypto worked and in fact how crude a technology it is they wouldn’t touch it with a barge pole.


  If you're going to make that claim, then you'll have to back it up with...something.  So...please tell us how it's such a 'crude' technology?


----------



## Brendan Burgess

tecate said:


> So these institutional investors who are getting involved in the market are religious zealots? The pension fund managers that have added crypto o their portfolios, the same?



Absolutely. The dot.com bubble was not fuelled by a few mad individual zealots. Big funds bought them as well. 




tecate said:


> There are all sorts of folk implicated with cryptocurrency and blockchain right now.



Why do you put both crytpo and blockchain in the same sentence like that? 

We are not dismissing the blockchain as being worthless - just Bitcoin.

Brendan


----------



## tecate

Brendan Burgess said:


> Absolutely. The dot.com bubble was not fuelled by a few mad individual zealots. Big funds bought them as well.


Sure, but there was something tangible behind it.  There is something tangible behind this too.  Will people get their fingers burnt - for sure, many will.  This market has proven to be cyclical - and so, we will have that happen again.  It doesn't mean that there are not good fundamentals behind it (even if people pile in at the end and go over-board).   There are other aspects that can't be compared with the dot com bubble.  It's a scarce asset and that affects the supply/demand dynamic.  Of course, from your perspective, it's got a value of zero and that's fine.  It's a question of whether others share that view.  As it stands at this moment, people determine it's value at $8086.  Perhaps that dynamic will change and it will collapse permanently.  That's your opinion albeit that it's not one I share.
Other than that, thanks for confirming that Duke's notion that Bitcoin is the sole preserve of 'religious zealots' is inaccurate.



Brendan Burgess said:


> Why do you put both crytpo and blockchain in the same sentence like that?


I've every right to do so as Bitcoin is a blockchain technology - the original blockchain technology.   The establishment financial services set started with this mantra of 'Blockchain, not Bitcoin'.  Jamie Dimon called it a fraud.  Roll on a few months and J.P. Morgan is launching its own cryptocurrency.  Facebook banned cryptocurrency related advertising.  They just changed that policy considerably as news emerges that they will launch their own cryptocurrency within weeks.

In terms of extended blockchain use cases, be aware that Microsoft have opened an identity project which will run on top of the Bitcoin blockchain network.   That has surprised many but it seems that technologists are finding ways to add other services with Bitcoin at its core using secondary layer.  I guess they want to use it as its proven itself - unlike younger blockchain networks.


----------



## Duke of Marmalade

tecate said:


> I see.  So these institutional investors who are getting involved in the market are religious zealots?  The pension fund managers that have added crypto to their portfolios, the same?
> There are all sorts of folk implicated with cryptocurrency and blockchain right now.  Yes, some approach from the perspective of crypto and blockchain with a view towards it providing a mechanism to help to advance society in various ways.  Only a blind man can't see that the technology has such attributes and the potential to benefit society provided its correctly implemented.
> 
> As regards the 'religious zealot' jibe, having had this debate/discussion with you many times, yours is just as much an entrenched view as I've found amongst no-coiners.  The zealotry cuts both ways.
> 
> 
> There's a hype cycle associated with any form of promising new technology.  We see the same with AR/VR/AI.  As regards this recent uptick - the reasons I provided you with above cover it.  Do people sit up and take notice, then FOMO in afterwards?  Sure.  Greed is part of the human condition.  It may be especially on show in this market - but it's to be seen in every other market too - to varying extents.
> 
> If you're going to make that claim, then you'll have to back it up with...something.  So...please tell us how it's such a 'crude' technology?


Zillions and zillions of trial and error attempts to solve a hashtag.  Givuz a break, doesn’t get more crude than that.


----------



## Brendan Burgess

tecate said:


> Of course, from your perspective, it's got a value of zero and that's fine. It's a question of whether others share that view.



Hi Tecate

Let's say that I think that Ryanair is a good company and the share is worth buying. I do a calculation based on earnings - I work out that its value is €10. If the price is less than that, I buy. If it's more than that, I don't.   

So you must presumably have done some calculation to arrive at a valuation for Bitcoin?  So could you share that with us?  Forget the price - tell us what you think the value is.

Brendan


----------



## tecate

Duke of Marmalade said:


> Zillions and zillions of trial and error attempts to solve a hashtag.  Givuz a break, doesn’t get more crude than that.


To solve a what now?  
I'm sorry the thing didn't arrive out of the box and disrupt world finance in one day as per your requirements.  I dont have the same problem as you seem to have with trial and error.  It's how practically EVERYTHING is improved upon.  



Brendan Burgess said:


> Hi Tecate
> 
> Let's say that I think that Ryanair is a good company and the share is worth buying. I do a calculation based on earnings - I work out that its value is €10. If the price is less than that, I buy. If it's more than that, I don't.
> 
> So you must presumably have done some calculation to arrive at a valuation for Bitcoin?  So could you share that with us?  Forget the price - tell us what you think the value is.
> 
> Brendan



Quite happy to answer Brendan but I'll get there by asking you this.  Do you believe that gold is an asset?  If so, what mechanism do you use to determine its price?


----------



## Duke of Marmalade

Oh please. Of course R&D does involve trial and error.  Having found the answer we advance.  In crypto the trial and error puzzle is merely to slow down the miners. No advance at all when the solution is found. I am presuming _tecate_ that you do understand blockchain though that comment gives me doubt.


----------



## Brendan Burgess

tecate said:


> Do you believe that gold is an asset? If so, what mechanism do you use to determine its price?



He tecate Quite happy to answer, but I will get there by answering you this? Do you or your partner own any gold jewellery?  Have you seen any gold artifacts? Have you handled a gold coin?   Have you seen any paintings which used gold leaf? 

Do you use any products which the industrial process required gold in its use? 

So, yes gold has both an industrial and an aesthetic value. 

But let me make it quite clear, that if I applied that metric to my Ryanair share certificates, they would be worth zero.

Brendan


----------



## tecate

Duke of Marmalade said:


> Oh please. Of course R&D does involve trial and error.  Having found the answer we advance.  In crypto the trial and error puzzle is merely to slow down the miners. No advance at all when the solution is found. I am presuming _tecate_ that you do understand blockchain though that comment gives me doubt.


Ok, so glad you accept that trial and error helps us to advance technologically.  Not sure why you threw your hands up at it initially, though.

As regards what the trial and error involves in cryptocurrency, it isn't what you claim.  Firstly there is a whole host of stuff that is being worked on - far too long to post here.  You talk of miners and cryptocurrency yet there are many significant projects in cryptocurrency and blockchain that don't involve miners.  There are also proof of stake based networks where the mining overhead is not as resource intensive yet there are other significant trade offs.  i assume that you mean't proof of work and Bitcoin rather than cryptocurrency generally.

As regards my understanding of blockchain, I'm not a cipher punk, a cryptographer or a developer.  I don't come from a professional background when it comes to the nuts and bolts of blockchain.  However, I don't have ANY insecurities in asking someone to explain something.  Please clarify what it is specifically that leads you to believe I don't understand blockchain? (or I guess specifically which aspect of it I don't understand - because at no stage am I claiming to know everything there is to know about blockchain - or even half of what there is to know...although current life sees me researching aspects of both the technology and the market connected with it - together with other emerging technologies on a daily basis).


----------



## tecate

Brendan Burgess said:


> He tecate Quite happy to answer, but I will get there by answering you this? Do you or your partner own any gold jewellery?  Have you seen any gold artifacts? Have you handled a gold coin?   Have you seen any paintings which used gold leaf?
> 
> Do you use any products which the industrial process required gold in its use?
> 
> So, yes gold has both an industrial and an aesthetic value.
> 
> But let me make it quite clear, that if I applied that metric to my Ryanair share certificates, they would be worth zero.
> 
> Brendan


I don't live a salubrious life, Brendan - so I don't own any gold. However, are you saying that gold doesn't have any value then?...or only that you can't use the same metric to assess its value?  If the latter, how do you assess its value?


----------



## Brendan Burgess

No, I am saying that they have completely different metrics for valuing them.  Gold has a value to people who like gold jewellery and works of art.   If I apply that metric to Bitcoin or Ryanair share certs, they have no value whatsoever. 

A financial asset which does not have any aesthetic value such as Bitcoin or Ryanair must be valued by something other than the greater fool theory. 

Brendan


----------



## Duke of Marmalade

tecate said:


> Ok, so glad you accept that trial and error helps us to advance technologically.  Not sure why you threw your hands up at it initially, though.
> 
> As regards what the trial and error involves in cryptocurrency, it isn't what you claim.  Firstly there is a whole host of stuff that is being worked on - far too long to post here.  You talk of miners and cryptocurrency yet there are many significant projects in cryptocurrency and blockchain that don't involve miners.  There are also proof of stake based networks where the mining overhead is not as resource intensive yet there are other significant trade offs.  i assume that you mean't proof of work and Bitcoin rather than cryptocurrency generally.
> 
> As regards my understanding of blockchain, I'm not a cipher punk, a cryptographer or a developer.  I don't come from a professional background when it comes the nuts and bolts of blockchain.  However, I don't have ANY insecurities in asking someone to explain something.  Please clarify what it is specifically that leads you to believe I don't understand blockchain?


You seem to equate the mind blowing trial and error of blockchain to normal R&D trial and error but possibly I misunderstood you.


----------



## tecate

Duke of Marmalade said:


> You seem to equate the mind blowing trial and error of blockchain to normal R&D trial and error but possibly I misunderstood you.


I'm not sure what it is that you have in mind in truth.  What I can tell you is that regardless of what any of us believe will become of the technology, the sector has attracted some very smart and intelligent people.  Bitcoin is already out there in the ether.  It's not in an R and D lab.  Therefore, work on that network doesn't quite happen in the same way as something that is offline if that is what you were getting at.  There is so much work ongoing - on every conceivable aspect of cryptocurrency and blockchain - and blockchain as it pertains to a whole host of industries that I can't possibly keep up with it.


----------



## tecate

Brendan Burgess said:


> No, I am saying that they have completely different metrics for valuing them.  Gold has a value to people who like gold jewellery and works of art.


Ok, so if someone is working the commodities markets professionally, how do they determine the value of gold?


----------



## Duke of Marmalade

tecate said:


> I'm not sure what it is that you have in mind in truth.  What I can tell you is that regardless of what any of us believe will become of the technology, the sector has attracted some very smart and intelligent people.  Bitcoin is already out there in the ether.  It's not in an R and D lab.  Therefore, work on that network doesn't quite happen in the same way as something that is offline if that is what you were getting at.  There is so much work ongoing - on every conceivable aspect of cryptocurrency and blockchain - and blockchain as it pertains to a whole host of industries that I can't possibly keep up with it.


The mindless solving of crypto puzzles is not to be compared with genuine R&D


----------



## Folsom

Perhaps I should declare my interest at this point. I could easily be described as FOMO or a zealot, a nerd, because I hold a small amount of bitcoin.
But I am also a skeptic insofar as the price fluctuations bear no reasonable reflection on what bitcoin is (or at least what I perceive it to be).
So for me, the jury is out. Bitcoin will ultimately be valued on what it is in the future rather than what any speculative market says it is worth today.

I do agree that the mining aspect is crude, but then again so was mining for metals and minerals thousands of years ago, even tens of thousands of years ago. And as much as such metals and minerals held some value to those miners it is simply inconceivable that they could have ever envisaged the value and usage of such mining to the extent that it is used today. 

So what is bitcoin? Or rather what is its use? 
It is an immutable sequence of algorithms that verify proof of work/ownership. It is blockchain. This is new technology, its ultimate usage is for the future. Its prospective usage is what drives the market speculation.

I dont buy the email analogy, my brother is soon to become a grandad and it was he who introduced me to bitcoin around six years ago through a magazine article. Grandads and grannies will be on top of this in the near future. 

I do like the reference to AI. Im not sure what AI is but apparently it is here, and here to stay. I do find the concept of having my car drive itself, built by robots, my house cleaned by robots, my job taken by automation, heart surgery performed by machines etc all a bit too scientific and star-trekish. 
But apparently it is here, we are on the cusp of another technological revolution. Such revolutions have in the past been the great disruptors to social norms and practices in the past.
If such a technological revolution comes to pass in the form of AI and all of its capabilities, how will anything else we do be valued? Who will determine the value of anything? Critically, who will determine such valuations?
The dollar, the yen, the euro, the yuan? 

Or perhaps, an immutable sequence of algorithms that verify proof of work and transaction?


----------



## tecate

Duke of Marmalade said:


> The mindless solving of crypto puzzles is not to be compared with genuine R&D


I think you've totally misunderstood the rationale behind Bitcoin mining.  It doesn't have an R & D function - but more importantly given your statement, that's not its objective, that's not what it's designed to do.  It plays a very important function in ensuring that the Bitcoin blockchain network is secure.   There may have been issues with centralised exchanges which deal in crypto but the actual decentralised blockchain network has NEVER been hacked and compromised and never been offline for one second in over ten years - despite daily attacks on the network.    You can't say the same for visa/mastercard or any bank system.


----------



## tecate

Folsom said:


> But I am also a skeptic insofar as the price fluctuations bear no reasonable reflection on what bitcoin is (or at least what I perceive it to be).
> So for me, the jury is out. Bitcoin will ultimately be valued on what it is in the future rather than what any speculative market says it is worth today.


In the main, I agree with you.  In discussion with Brendan, when he asked about my methodology for determining the price of Bitcoin vs. his methodology for assessing stocks, I brought in gold into the equation as I see it as highly relevant to the context of this whole discussion.  Gold may be considered a currency but its also a commodity.  How are commodities valued?  Is it less scientific than the assessment of the valuation of an equity stock?  Is it based on the supply and demand dynamic?  To me it's the latter - and it's the very same for Bitcoin as a digital asset.  It has designed in scarcity.  If it has NO utility, then that won't make a difference.  There has been (and it seems will continue to be) a debate on here as regards whether it has utility.  My view is that it has.  My view is that whilst that utility is still coming forth - it will eventually drive pricing through that supply/demand dynamic.  There are a number of factors leading into that - and next years halving also does so.

Is there a hype cycle around cryto?  Definitely.  Is there FOMO and over-exuberance?  For sure.  That doesn't mean that it doesn't have value.  I have not seen a model of assessment for Bitcoin price that is in any way as efficient as Brendan presents for equity stocks.  it doesn't exist.  However, we know what the market cap of crypto and bitcoin is.  We know what it is for gold.  If you are to accept that bitcoin is becoming digital gold (and clearly many here don't...and within crypto circles, equally, many say its not), then to take just a percentile of that market is going to drive the price up.  We are seeing institutional investment  According to Fidelity, 22% of institutions now have exposure to digital assets with 50% saying that they are open to gaining exposure.  We have seen the first pension funds gain exposure.  Again, if we are to work on the basis of that market expanding, the demand on a scarce resource will increase - having a knock on effect on the price.  

Those are just examples.  Of course, there is a lot of clarity needed yet in all manner of ways.  Regulatory clarity, clarity as regards to the effectiveness of lightning network and layer 2 protocols (to determine if Bitcoin can be effective at scale for micro-transactions).  So, with some knowns and many unknowns, of course, it's speculative.



Folsom said:


> I do agree that the mining aspect is crude, but then again so was mining for metals and minerals thousands of years ago, even tens of thousands of years ago. And as much as such metals and minerals held some value to those miners it is simply inconceivable that they could have ever envisaged the value and usage of such mining to the extent that it is used today. ?


I've swayed a few times on the mining aspect.  However, if mining companies themselves stake the capital and use stranded renewable power or non-renewables that are simply being wasted by the petroleum industry, then what's the harm?  LINK.



Folsom said:


> I dont buy the email analogy, my brother is soon to become a grandad and it was he who introduced me to bitcoin around six years ago through a magazine article. Grandads and grannies will be on top of this in the near future.


Kudos to your brother.  I didn't mean to be disrespectful to grannies n' grandads!  However, I do stand by the email analogy.  Here is what the understanding of email was like in 1994.  Earlier than that still, it was incredibly complicated to send an email - by comparison with what we have to do to send an email today.



Folsom said:


> If such a technological revolution comes to pass in the form of AI and all of its capabilities, how will anything else we do be valued? Who will determine the value of anything? Critically, who will determine such valuations?
> The dollar, the yen, the euro, the yuan?
> Or perhaps, an immutable sequence of algorithms that verify proof of work and transaction?


Blockchain is much more understandable to me than the questions you pose here!  However, what I would say is that there will be a machine to machine economy that will implicate crypto/blockchain and internet of things.  Machines will buy and sell data.  The most immediate and obvious example is autonomous mobility.   One project that's aimed at this from the crypto/blockchain perspective is IOTA.  There are already a couple of european startups that have trialled/piloted the automatic payment for electric vehicle charging using IOTA tokens.  Jaguar/Land Rover intend to include a digital wallet in their cars to make such payments as well as for parking and tolls, etc.  The project has been collaborating with a number of car manfacturers including VW.  Last rumour (unconfirmed) was that they are in talks with Ford.  

As regards the value that's placed on stuff, it's always been determined by us relative to supply/demand.  However, with AI, who the hell knows!


----------



## tecate

Duke of Marmalade said:


> _tecate_ I am not convinced by your explanations of the “uptick”


That's fair enough - everyone makes up their own mind, right?



Duke of Marmalade said:


> Panicking equity investors: No.  If there was panic about the value of FIAT currencies, yes that might explain things.  But equity investors are not in a panic about the value of the currencies.  In times of panic there is a flight to safety - bitcoin ain’t safe.


Right, and do equity investors  look for growth also?  Do they look to diversify?  Are growth opportunities the same as what they once were in other conventional asset classes?  Would they look to a completely unconnected asset class? 

It seems that your mind is made up - I'll keep mine open.



Duke of Marmalade said:


> Big names accepting bitcoin:  Are they really?  Will Starbucks really be pricing in bitcoin? Or as a marketing gimmick will they be setting up an interface which converts bitcoin at the going rate to dollars?


  What marketing gimmick?  Starbucks made NO announcement about this whatsoever.  On this unit of account business, so what?  You read earlier in this thread that there are plenty of people in and around the crypto economy that would happily spend Bitcoin given the opportunity.  You think Bitcoin not being a unit of account would stop them?  It's a complete non-argument.
Furthermore, you don't place value on this development.  It's reasonable to think that there are others that share your view.  However, it is foolish to think that there aren't others that don't and think this is a significant development.

I think that it has the potential to be very significant.  Two of the largest U.S. grocery stores have been pushing back against visa due to fees.  Kroger - the largest grocery retailer in the U.S. - recently withdrew visa payment from some of their stores in pushing back against the payment processor due to fees.  Walmart did the same in Canada for 7 months.  

If lightning network continues to grow, then it could well be a good option for these guys.



Duke of Marmalade said:


> Maybe developments on the futures exchanges are having an influence, I remember that was behind the surge in 2017. I’ll buy that one but does it really explain a 100% jump?


I didn't commit to any one of what I listed as being the reason for the upswing.  However, with the exception of the Ebay story which has since been denied, they're all positive developments.  I'm not under any obligation to serve you up with such an account.  There are two sides to a discussion.  By all means, have at it with your own explanations.


----------



## Leo

tecate said:


> Separate regulation is required.



By separate regulations, you can only mean weaker ones. That can not be a good thing, making fraud easier should not be something the regular banking system are required to do. The regulation issues are the crypto world's to solve, but much of the crypto world are very much against the traceability and full audit trail requirements that responsible regulation demands.


----------



## Folsom

tecate said:


> Kudos to your brother


 He never actually bought any.  He was simply inquiring if anyone knew anything about it, and tried to explain it to me. We both ended up thinking there was nothing in it. 
I was bitcoins persistence, helped in no small measure by its increasing value, that kept me interested until I bought some. 
But it wont be long before people of my generation will start becoming grandparents.


----------



## Leo

Duke of Marmalade said:


> Really only two other possible reasons for the price surge



Or a third...internal manipulation of the market. There has been a lot of speculation of a number of exchanges engaging in large scale washes (illegal in conventional markets) to inflate transaction volumes.


----------



## Duke of Marmalade

tecate said:


> I think you've totally misunderstood the rationale behind Bitcoin mining.  It doesn't have an R & D function - but more importantly given your statement, that's not its objective, that's not what it's designed to do.  It plays a very important function in ensuring that the Bitcoin blockchain network is secure.


I fully understand the rationale behind bitcoin mining, thanks to _fpalb_.  Perhaps you misunderstood my point, it happens.  
I ridiculed the zillions of running the SHA algorithm on a trial and error basis until you get an answer.  You countered by pointing out that EVERYTHING comes from trial and error.  I presumed you were referring to R&D but possibly you had something else in mind, please clarify.  I counter countered that the progress garnered from R&D trial and error could in no way be compared with the mind numbing “Proof of Work” nonsense in the bitcoin protocol.
Also can you explain in more detail why the fully anticipated halving of the rate of increase in bitcoin supply would fuel bullish speculation as the halving approaches?


----------



## Leo

tecate said:


> - Fidelity (one of the worlds largest asset managers) came out and said that they'd be trading crypto for their clients within the next few weeks.



Intra-institution trading only, all transaction will have to be be able to prove regulatory compliance. Some might see this as a step on the journey to regularising bitcoin in particular, but others who see crypto as a means of escaping big brother or regulation won't like it.


----------



## EmmDee

Leo said:


> By separate regulations, you can only mean weaker ones. That can not be a good thing, making fraud easier should not be something the regular banking system are required to do. The regulation issues are the crypto world's to solve, but much of the crypto world are very much against the traceability and full audit trail requirements that responsible regulation demands.



A: Can we join the club and use the facilities?
B: Sure - here are the rules and application form
A: Don't like those rules - I'm against rules philosophically. I'm more of a free spirit
B: Ok
.
.
.
.
.
.
A: So can we still use the facilities?


----------



## Leo

EmmDee said:


> A: So can we still use the facilities?



Almost how dare you enforce your rules to prevent me from doing what I want in your club


----------



## tecate

Leo said:


> By separate regulations, you can only mean weaker ones. That can not be a good thing, making fraud easier should not be something the regular banking system are required to do. The regulation issues are the crypto world's to solve, but much of the crypto world are very much against the traceability and full audit trail requirements that responsible regulation demands.


Well we've already touched on it so I don't see what the confusion is.  I believe that people should have the financial freedom to use unconfiscatable, borderless money anonymously.  I believe that AML/KYC are an unnecessary evil - that cause regular people a lot of grief and don't stop the cartels in moving money.  Who's going to agree to taking the very things that give Bitcoin utility and break them up on that inflexible approach?  As I said before, government agencies need to make a decision -  either ban it or embrace it.



Leo said:


> Or a third...internal manipulation of the market. There has been a lot of speculation of a number of exchanges engaging in large scale washes (illegal in conventional markets) to inflate transaction volumes.


Yes, there has been market manipulation and wash trading.  It's a new market and its a small market so much easier to manipulate.  As regards the illegal part, then regulate it already.  (and just to head off any conversation about my request to regulate, anyone in this space wants centralised points in the ecosystem regulated - and cryptocurrency exchanges are centralised).



Leo said:


> Intra-institution trading only, all transaction will have to be be able to prove regulatory compliance. Some might see this as a step on the journey to regularising bitcoin in particular, but others who see crypto as a means of escaping big brother or regulation won't like it.


Ok, intra-institution is the reason it's a big deal as news.  Not sure what the confusion is there.  Remember his dukeness asked for reasons that were driving the price.  You're coming back on this with regard to regulation - there are two discussions getting tangled up here.  Bitcoin was designed for regular people.  That we have institutions using it, I've no problem with that.  If you're saying that Bitcoin as a protocol has to change in some way so that institutions can use it to fulfill some regulatory demand or other, well that simply won't be happening.  The regulator or any government agency won't be walking in to the offices of Bitcoin or any other cryptocurrency - because there is no such office or central point.  The code and the network runs and does so on a decentralised basis.
Do the original cipher punks who were behind efforts to get Bitcoin off the ground have any time for this aspect of things?  Absolutely not.  However, as I see it, I don't see the harm so long as those who want to use it as individuals - as it was originally intended can still do so.  The inherent characteristics of Bitcoin can't be changed.  Now, your regulatory friends can deem a centralised shítcoin like JP Morgan Coin as acceptable and Bitcoin not acceptable - but thats up to them.  Bitcoin is already what it is - it cant be changed.
Whilst we're on the subject of institutions and regulation, in the U.S. a number of House Representatives from both sides of the Democratic/Republican isle have tabled a bill to bring about separate securities law regulation for cryptocurrency and blockchain on the basis that the current securities law is not fit for purpose when it comes to this technology.  The SEC base decisions on law that dates back to the Howey test in the 1940's.  Others have tabled bills looking to have the matter taken out of the hands of the SEC.  At state level, there have been similar moves.  Just because a new technology or industry comes along doesn't mean we have to force it into compliance with whatever's there already.



Leo said:


> Almost how dare you enforce your rules to prevent me from doing what I want in your club


Well, this is an interesting insight.  Imagine the audacity to stop up and question what systems are in place and  challenge them?  You said yourself these are government mandated measures (KYC/AML).  Government and regulation is supposed to work for the people.  I don't see that happening with this nonsense.  We have diametrically opposing views on that but that's alright.

It's interesting that you use the word 'club' though.  You can be turfed out of that 'club' at any time.  As wikileaks found out.  The U.S. put pressure on all financial institutions - meaning that the organisation couldn't accept donations from the public.  There was only one other means for them to take donations - Bitcoin.  Without it, wikileaks wouldn't have survived.


----------



## Folsom

tecate said:


> that cause regular people a lot of grief and don't stop the cartels in moving money.



Speaking of which;

https://www.bbc.com/news/business-48292946


----------



## tecate

Duke of Marmalade said:


> I fully understand the rationale behind bitcoin mining, thanks to _fpalb_.  Perhaps you misunderstood my point, it happens.  I ridiculed the zillions of running the SHA algorithm on a trial and error basis until you get an answer.  You countered by pointing out that EVERYTHING comes from trial and error.  I presumed you were referring to R&D but possibly you had something else in mind, please clarify.


You used the term "to solve a 'hashtag'".  With that, I hadn't the foggiest as regards what you meant but know now that you were referring to the proof of work based mining process where an equation is solved every ten minutes in order to create sufficient randomness and ensure that the network can't be gamed and manipulated.  That process has its detractors on the basis that its resource intensive. However, if it uses stranded renewable power (or non-renewable power that is being literally burnt up on oil and gas fields around the world as I type this), what's the harm?  Most is renewable based - and where it isn't, by all means, regulate it out of existence.  So, long story short, you can ridicule it all you want - I'm not in agreement with you on the subject.



Duke of Marmalade said:


> Also can you explain in more detail why the fully anticipated halving of the rate of increase in bitcoin supply would fuel bullish speculation as the halving approaches?


Because I was around for the last halving and experienced the same thing.  I witnessed it happen before - and its effect on my own BTC holding.  However, I'm not here to justify anything to you Duke - you can make up your own mind - or you can present your own thesis on the subject.  Have at it.


----------



## Duke of Marmalade

The title of the thread is “The Big jump in Bitcoin…”
I accept that the price is a function of supply and demand.  Usually we can identify the drivers of each side.  Oil for example.  Geo-politics largely drives short term supply and geo economics drives demand. There is a futures market so there is a small speculative aspect.
When it comes to bitcoin there is no mystery about the supply side.  It is more or less cast in stone and has already achieved 83% of its ultimate destiny.  So forget the supply side or any of this halving stuff.
So price movements are almost entirely driven by the demand side.  So right off the top of my head here is a breakdown of the demand pie:
Nerds 1%
Anti establishment zealots 1%
Best currency for purchasing certain goods 0%
Criminal proceeds 1%
Hide money from the wife/other 1%
Diversification 1%
Refuge for distressed equity investors 0%
Speculation and/or market manipulation 95%

This huge share of the pie taken by this last is a surprise even to me
There is no other commodity/ asset class which comes anywhere near.  So when we see wild gyrations it is to this last that we should look for an explanation.  Two plausible explanations have been proferred.
_tecate_ developments on the futures exchanges
_Leo_ market manipulation
The former is reminiscent of the 2017 surge to 20$ which quickly reversed
The latter must also reverse quickly
Perhaps time for the Duke to renew his short position.  Ironically the price is now roughly where it was when I closed out my 14k short position in early 2018


----------



## Duke of Marmalade

tecate said:


> You used the term "to solve a 'hashtag'".  With that, I hadn't the foggiest as regards what you meant but know now that you were referring to the proof of work based mining process where an equation is solved every ten minutes in order to create sufficient randomness and ensure that the network can't be gamed and manipulated.  That process has its detractors on the basis that its resource intensive. However, if it uses stranded renewable power (or non-renewable power that is being literally burnt up on oil and gas fields around the world as I type this), what's the harm?  Most is renewable based - and where it isn't, by all means, regulate it out of existence.  So, long story short, you can ridicule it all you want - I'm not in agreement with you on the subject.
> 
> Because I was around for the last halving and experienced the same thing.  I witnessed it happen before - and its effect on my own BTC holding.  However, I'm not here to justify anything to you Duke - you can make up your own mind - or you can present your own thesis on the subject.  Have at it.


Yes I was in error in describing hash as hashtag but I think you knew what I meant.

As I have explained in another post there is no rational reason why halving should have any effect on the price but I take your word for it that this has been past experience.  That is an empirical observation but I presume you have no rational explanation as to why it should be so. Why would I expect crypto pricing to be rational, silly Duke


----------



## tecate

Duke of Marmalade said:


> Yes I was in error in describing hash as hashtag but I think you knew what I meant.


Not until your subsequent posts I didn't.


Duke of Marmalade said:


> As I have explained in another post there is no rational reason why halving should have any effect on the price but I take your word for it that this has been past experience.  That is an empirical observation but I presume you have no rational explanation as to why it should be so.


Why isn't it rational?  The amount of Bitcoin in circulation will drop.  Bitcoin mining farms have real world expenses in FIAT.  They have to sell the 'reward' that they receive for mining.  Half of that reward is going to disappear yet they have the same expenses.



Duke of Marmalade said:


> Why would I expect crypto pricing to be rational, silly Duke


There is plenty of market irrationality but I don't think that specific point is an example.  Furthermore, there can be all manner of irrationality on the market end of things and yet still be something tangible at the core of the technology.  There can still be a utility in terms of electronic money.


----------



## Leo

tecate said:


> Well we've already touched on it so I don't see what the confusion is.  I believe that people should have the financial freedom to use unconfiscatable, borderless money anonymously.



That's your belief and you're entitled to it. But you are clearly in a minority, and so you need to realise that the banking system will never dilute regulation to allow those who share your beliefs bypass controls put in place for the protection of consumers. 



tecate said:


> I believe that AML/KYC are an unnecessary evil - that cause regular people a lot of grief and don't stop the cartels in moving money.



Again, if the cartels can move money so easily, why are they so invested in physical assets and engaging in elaborate money laundering schemes that see them lose a significant percentage of funds? Apart from people who want to interact with exchanges that can't prove compliance, what issues are you referring to here? Surely AAM would be flooded with threads on the issue if there was such 'a lot of grief'. 

And again, just because a rule or regulation doesn't stop 100% of fraud is a very poor reason to row back on those rules. Indeed, the only case it makes is for the strengthening of those rules. We should aspire to a system that gets as close to the elimination of fraud as possible. To suggest throwing the doors open because we haven't yet gotten to 100% elimination makes no sense whatsoever. 



tecate said:


> As I said before, government agencies need to make a decision -  either ban it or embrace it.



They really don't. It's the crypto world that needs to mature and figure out what it wants to be if it's to thrive. If it wants to be linked into the regular financial system, it needs to figure out how to play by the rules, if it wants to remain a wild west of anonymity, then it needs to understand why it will always face restrictions.  



tecate said:


> Yes, there has been market manipulation and wash trading.  It's a new market and its a small market so much easier to manipulate.



That is actually a very good argument as to why established banks should protect themselves and their customers and have nothing to do with it. 



tecate said:


> If you're saying that Bitcion as a protocol has to change in some way so that institutions can use it to fulfill some regulatory demand or other, well that simply won't be happening.  The regulator or any government agency won't be walking in to the offices of Bitcoin or any other cryptocurrency - because there is no such office or central point.



You're misunderstanding me there. So Fidelity are offering intra-institution trading. It is Fidelity and those other institutions that will be audited on these transactions just as all of their existing institutional and retail trading activities are. The fact that Bitcoin doesn't have an office in no way diminishes their regulatory responsibility regarding such trading.



tecate said:


> Do the original cipher punks who were behind efforts to get Bitcoin off the ground have any time for this aspect of things?  Absolutely not.



Fully agree with that, but it's clear they  had such mistrust of the financial institutions that they would not be getting hung up on those very institutions refusing to play by their rules. I'd imagine they would be pretty disappointed if their vision's success or failure hinged on whether people could escape the crypto world back to the banks they so loathed.



tecate said:


> Bitcoin is already what it is - it cant be changed.



Indeed, just as the heavily regulated financial systems are what they are and can't be changed to facilitate the flouting of the very regulations they run under.


----------



## Leo

tecate said:


> Not until your subsequent posts I didn't.



In fairness to the Duke, he did put in the effort in the early days of this particular forum to tease out the workings of Bitcoin with fpalb and others.


----------



## Duke of Marmalade

tecate said:


> Not until your subsequent posts I didn't.
> 
> Why isn't it rational?  The amount of Bitcoin in circulation will drop.  Bitcoin mining farms have real world expenses in FIAT.  They have to sell the 'reward' that they receive for mining.  Half of that reward is going to disappear yet they have the same expenses.


Clearly I misunderstand bitcoin - _fpalb_ please help.  I was led to believe that bitcoin supply would continue to grow until 2040 (or is it 2140) when it reached its max of 21m.  But you explain that this halving will cause the amount of bitcoin in circulation to drop.


----------



## EmmDee

Duke of Marmalade said:


> Clearly I misunderstand bitcoin - _fpalb_ please help.  I was led to believe that bitcoin supply would continue to grow until 2040 (or is it 2140) when it reached its max of 21m.  But you explain that this halving will cause the amount of bitcoin in circulation to drop.



I believe it is the rate of creation which will drop.


----------



## tecate

Duke of Marmalade said:


> When it comes to bitcoin there is no mystery about the supply side.  It is more or less cast in stone and has already achieved 83% of its ultimate destiny.  So forget the supply side or any of this halving stuff.


I think you are still misunderstanding the dynamic.  See my post above.  Miners won't be putting as much BTC onto the market to sell - to pay for their hefty FIAT based expenses.



Duke of Marmalade said:


> Nerds 1%
> Anti establishment zealots 1%


Eh, , crypto is nerd central - I think I'd be demanding a recount in yer sophisticated polling there, Duke.  And if we are to have 'anti establishment 'zealots', lets have a column for pro authoritarian government zealots too (you can stick them in at 0% - I just want to balance out the 'zealot' part as that definitely cuts both ways).



Duke of Marmalade said:


> This huge share of the pie taken by this last is a surprise even to me


Shocking! 
Joking aside, just in case anyone thinks otherwise, I'm not for one second suggesting that any of this isn't speculative.  My own current involvement is speculative.



Duke of Marmalade said:


> _tecate_ developments on the futures exchanges
> _Leo_ market manipulation


I believe I offered a longer list of triggers.  You've decided to discount them from your pinpoint accurate breakdown.I also omitted a couple.
- E-Trade, one of the U.S.'s biggest retail investment platforms intend to add cryptocurrency trading shortly.
- OTC trading has increased significantly in recent months.

Other than that, I'm quite happy to include market manipulation on my list.  I'm quite satisfied that its a thing in this market and it was and is a concern of mine in this recent uptick.  I just couldn't find a way of determining it as the root cause.



Duke of Marmalade said:


> The former is reminiscent of the 2017 surge to 20$ which quickly reversed
> The latter must also reverse quickly
> Perhaps time for the Duke to renew his short position.  Ironically the price is now roughly where it was when I closed out my 14k short position in early 2018


This market has proven to be cyclical.  What happened in 2017 had happened on four previous occasions.  As regards shorting, good to see someone have conviction in their beliefs  - go for it.  Personally (in my completely unqualified opinion) I believe that this recent surge will retrace but I'm relatively confident that the market will move upwards and revisit the ATH price between now and Dec 2021.


----------



## Duke of Marmalade

Ahhh!  You meant the amount on *offer* will drop.  But you said the amount in *circulation* will drop.  I see the point though a rational market would have already priced this in; it is not new information.

ATH?


----------



## tecate

Leo said:


> That's your belief and you're entitled to it. But you are clearly in a minority, and so you need to realise that the banking system will never dilute regulation to allow those who share your beliefs bypass controls put in place for the protection of consumers.


No problem - but understand that anyone who had a genuine interest in Bitcoin originally (aside from the speculative pricing sideshow) bought into the concept on precisely this basis.  This in effect is what Bitcoin is about.  To change those fundamentals (if it were possible) is to kill it.



Leo said:


> Again, if the cartels can move money so easily, why are they so invested in physical assets and engaging in elaborate money laundering schemes that see them lose a significant percentage of funds? Apart from people who want to interact with exchanges that can't prove compliance, what issues are you referring to here? Surely AAM would be flooded with threads on the issue if there was such 'a lot of grief'.


I didn't say that the cartels can do it easily.  However, they have the resources to do it.  I see it every day - where i'm located these days, I see 'businesses' that are simply washing money.  That's 99.9% of what they do.
As regards issues, have you ever had a bank account closed? Have you ever had YOUR money locked up until some jobsworth somewhere gets whatever documentation they demand?  You seem to see this as a non issue yet its central to the development of Bitcoin.  That accounts for more than a few people.  It causes considerable friction.  That's before you get into other jurisdictions.  There are places where you can only bring money into a country in a certain way and have it registered with the central bank.



Leo said:


> And again, just because a rule or regulation doesn't stop 100% of fraud is a very poor reason to row back on those rules. Indeed, the only case it makes is for the strengthening of those rules. We should aspire to a system that gets as close to the elimination of fraud as possible. To suggest throwing the doors open because we haven't yet gotten to 100% elimination makes no sense whatsoever.


We are locked in diametrically opposing views on this one and nothing it seems will change that.  Crime can be fought in the traditional sense.  That's the way it was not so long ago before all this AML/KYC nonsense.  We disagree on it - so lets park it up.



Leo said:


> They really don't. It's the crypto world that needs to mature and figure out what it wants to be if it's to thrive. If it wants to be linked into the regular financial system, it needs to figure out how to play by the rules, if it wants to remain a wild west of anonymity, then it needs to understand why it will always face restrictions.


I disagree.  You can't make such changes to a decentralised currency - much less changes that are fundamental to it. You can't ask for what's not available to be provided in terms of info.  Are we saying then that there can't be any transfer from any cryptocurrency exchange?  In which case, can there be sufficient maturity from the regulators to say so - as that's NOT what they're saying right now.



Leo said:


> That is actually a very good argument as to why established banks should protect themselves and their customers and have nothing to do with it.


Nonsense.  Look, what has that got to do with me as an ordinary joe transacting wealth in the form of Bitcoin?  Centralised exchanges need to be properly regulated. The irony is that everyone in the industry wants them properly regulated - but regulators are sitting on their hands.



Leo said:


> You're misunderstanding me there. So Fidelity are offering intra-institution trading. It is Fidelity and those other institutions that will be audited on these transactions just as all of their existing institutional and retail trading activities are. The fact that Bitcoin doesn't have an office in no way diminishes their regulatory responsibility regarding such trading.


I'm not misunderstanding you at all. I'm well aware they have fiduciary obligations.  The fact is that they want to invest in crypto but have been reluctant to do so up until now for this very reason.  I didn't suggest that Bitcoin not being centrally controlled diminishes their fiduciary responsibility.  However, you seem to be suggesting that the cryptocurrency itself needs to be changed when it can't (nor is there a desire to do so even if it was possible).



Leo said:


> Fully agree with that, but it's clear they  had such mistrust of the financial institutions that they would not be getting hung up on those very institutions refusing to play by their rules. I'd imagine they would be pretty disappointed if their vision's success or failure hinged on whether people could escape the crypto world back to the banks they so loathed.


Lets be realistic here.  I don't think I'm going out on a limb in saying that 99.99% of those very same people had bank accounts and did everyday banking like everyone else.  How would they have gotten paid?  How would they have paid their mortgages?

Bitcoin and crypto has been borne into an established financial system.  If you are suggesting that I and them should only be operating in that economy - well, something like this doesn't just unpack itself in a short period of time.  Of course there is a need for those in the crypto space to have a foot in both.  I don't see where the mystery is here.



Leo said:


> Indeed, just as the heavily regulated financial systems are what they are and can't be changed to facilitate the flouting of the very regulations they run under.



The regulations can be changed. Or if you're saying the decision is that Bitcoin be banned - then go ahead and ban it.  You're saying that we can't have it both ways.  I'm saying the very same for governments (which by the way are supposed to represent all of us).  But let them ban it and see what happens.


----------



## tecate

Duke of Marmalade said:


> I see the point though a rational market would have already priced this in; it is not new information.


Yeah, fair point - but I never disagreed that there wasn't large helpings of irrational behaviour in the market.   
That said, the market simply isn't anywhere near maturity yet.  On the previous occurrence, the price started to build a year out from the halving.  Remember, there are lots of retail investors in this market.  Many of them don't even understand the halving or the implications of it...and maybe some of them learn about it nearer the time.


----------



## Duke of Marmalade

I think I’ll buy this “halving” thing being a significant if somewhat irrational factor in the uptick.


----------



## tecate

Duke of Marmalade said:


> I think I’ll buy this “halving” thing being a significant if somewhat irrational factor in the uptick.


I'm still on the fence as regards all reasons provided but nice to be able to almost agree with someone on this thread occasionally. 


ATH = 'All time high'.


----------



## Leo

tecate said:


> This in effect is what Bitcoin is about.  To change those fundamentals (if it were possible) is to kill it.



I think we both know they are not going to change those fundamentals, those behind Bitcoin have no reason to make it easy for people to cash out, that's not what their vision is. 



tecate said:


> I didn't say that the cartels can do it easily.  However, they have the resources to do it.  I see it every day - where i'm located these days, I see 'businesses' that are simply washing money.  That's 99.9% of what they do.



You should probably report that to the ODCE. 



tecate said:


> As regards issues, have you ever had a bank account closed? Have you ever had YOUR money locked up until some jobsworth somewhere gets whatever documentation they demand?



I haven't, but then I have been careful in my financial dealings not to trade with companies or platforms that are widely acknowledged to harbour widespread criminal activity. 



tecate said:


> You seem to see this as a non issue yet its central to the development of Bitcoin.



Given the scale of the financial industry, it absolutely is a non-issue. If the future development of Bitcoin is dependent on the financial system it rails against setting aside their rules to accommodate it, and turn a blind eye to the illegal activity that goes along with it, then Bitcoin is doomed. Most crypto advocates don't see this as an issue, it's mainly those who are purely in it for speculation have a problem.  



tecate said:


> There are places where you can only bring money into a country in a certain way and have it registered with the central bank.



That was one of the key topics of Antonopulos' talk in UCD last year. It is in such jurisdictions that he sees crypto having function. The last think anyone in such a place is likely to want to do is cash out to a back account though. 



tecate said:


> We are locked in diametrically opposing views on this one and nothing it seems will change that.  Crime can be fought in the traditional sense.  That's the way it was not so long ago before all this AML/KYC nonsense.  We disagree on it - so lets park it up.



Fair enough, I can't understand how a rational person would see AML/KYC as nonsense.  



tecate said:


> Are we saying then that there can't be any transfer from any cryptocurrency exchange?  In which case, can there be sufficient maturity from the regulators to say so - as that's NOT what they're saying right now.



There's no reason why the exchanges can't implement systems that would allow them become compliant, most of them aren't mature enough to do so yet, some are, others will likely get there. The challenge they have is much of the crypto world doesn't want compliance. They don't want that regulation and availability of audit trail, proof of identities, etc.. 



tecate said:


> Nonsense.  Look, what has that got to do with me as an ordinary joe transacting wealth in the form of Bitcoin?



Nothing, you're free to transact Bitcoin as you see fit. Banks are obliged to block transactions where the source of funds can not be proven, the majority of people see this as a very good thing. 



tecate said:


> I'm not misunderstanding you at all. I'm well aware they have fiduciary obligations.  The fact is that they want to invest in crypto but have been reluctant to do so up until now for this very reason.



You're quite a few years behind the times if you think they're only investing now, there's even been a lot of the work carried out in Ireland. 



tecate said:


> Bitcoin and crypto has been borne into an established financial system.



Satoshi's vision was to eliminate the banking system entirely. Not link the two together in any way. 



tecate said:


> The regulations can be changed. Or if you're saying the decision is that Bitcoin be banned - then go ahead and ban it. You're saying that we can't have it both ways. I'm saying the very same for governments (which by the way are supposed to represent all of us). But let them ban it and see what happens.



I've never said Bitcoin should be banned, I've often said it's flawed, but never said it should be banned. Again, I don't see why a government would ban Bitcoin. It comes down to two choices:
 1. Facilitate the development of Bitcoin/ crypto, scrap AML / fraud prevention rules and let the criminals have an easy life
 2. Continue to make life as difficult as possible for the criminals, with some inconvenience to the development of Bitcoin/ crypto

Which option do you think the majority of citizens would choose? Exactly to your point, governments represent us all, that doesn't mean they implement legislation for us each individually. 

What great value does crypto have that would outweigh the negatives of rolling back regulations?


----------



## tecate

Leo said:


> I think we both know they are not going to change those fundamentals, those behind Bitcoin have no reason to make it easy for people to cash out, that's not what their vision is.


Of course - we are in complete agreement.  Changes can only be made by consensus.  There is no earthly way such a consensus would be reached as its core to what Bitcoin is all about.



Leo said:


> You should probably report that to the ODCE.


I'm not in Ireland.  I'm overseas in the home of the cartels.  I don't think that they'd appreciate me having a word.  lol



Leo said:


> I haven't, but then I have been careful in my financial dealings not to trade with companies or platforms that are widely acknowledged to harbour widespread criminal activity.


Ok, is there a list of approved cryptocurrency exchanges and non-approved exchanges?  And if you're saying that none of them are and no funds can be accepted from a cryptocurrency exchange, let the regulators come out and say exactly that (because they're not saying that).



Leo said:


> Given the scale of the financial industry, it absolutely is a non-issue. If the future development of Bitcoin is dependent on the financial system it rails against setting aside their rules to accommodate it, and turn a blind eye to the illegal activity that goes along with it, then Bitcoin is doomed. Most crypto advocates don't see this as an issue, it's mainly those who are purely in it for speculation have a problem.


This cuts both ways.  Why has there not been a complete blanket ban on crypto? 
Other than that, once I'm enabled to go about my business (all of it) on a daily basis and custody my own funds in crypto, I will.  Until then, there are real world issues to cut through.



Leo said:


> That was one of the key topics of Antonopulos' talk in UCD last year. It is in such jurisdictions that he sees crypto having function. The last think anyone in such a place is likely to want to do is cash out to a back account though.


Yes, A.A. has said that crypto has far more potential in developing countries.  Exactly to that point - what I mentioned.  There are FIAT based systems that are supposed to be about AML/KYC that are unreal in their bureaucracy and demands.  It's not just about your experience in Ireland.  As regards cashing out, I wasn't necessarily talking about cashing out crypto in that instance.  That's any money that comes into the country.   I'm not going into the finer points of it but it's a complete bureaucratic nightmare.



Leo said:


> Fair enough, I can't understand how a rational person would see AML/KYC as nonsense.


Well, as I said - we simply don't agree on it - so lets leave it be.  And by the way, that's Antonopoulos' view on the matter also.




Leo said:


> There's no reason why the exchanges can't implement systems that would allow them become compliant, most of them aren't mature enough to do so yet, some are, others will likely get there. The challenge they have is much of the crypto world doesn't want compliance. They don't want that regulation and availability of audit trail, proof of identities, etc..


I'm not sure what it is you're looking for.   Crypto exchanges do implement KYC/AML.  I can't use a crypto exchange without doing the same identity verification as with a bank.  What are we even doing it for if I still can't move my funds?



Leo said:


> You're quite a few years behind the times if you think they're only investing now, there's even been a lot of the work carried out in Ireland.


There has been limited investment from such circles globally.  I can't talk about Ireland specifically  but I can't imagine how that's any further on.  I've spoken to someone who operates an exchange in lreland and he lamented the lack of regulation in relation to crypto - and the need for regulatory clarity.



Leo said:


> Satoshi's vision was to eliminate the banking system entirely. Not link the two together in any way.


I can't say I know the Bitcoin whitepaper from memory.  Did he/she/they actually state 'eliminate the banking system'?  My understanding is that it was definitely in response to mismanagement and wrong doing in the conventional system.  I'd imagine it was with a view of 'offering an alternative'.  I don't recall it being so militant as to replace it.  If you've got a link to that tract of text, I'd be interested in reading it.
As regards 'linking the two together' - lets inject some realism.  Bitcoin came from nothing - so how would you encourage someone to be part of it if they can't on-ramp?  Yes, they can offer goods/services but that's not the only way and nor should there be an expectation of it being the only way.  Now, 'link' sounds a bit formal.  All I ask is the ability to be allowed to change money from one to the other.  There are services that are quite happy to do that for me.  But it seems there are establishment jobsworths that want to stand in the way of that.



Leo said:


> I've never said Bitcoin should be banned, I've often said it's flawed, but never said it should be banned. Again, I don't see why a government would ban Bitcoin. It comes down to two choices:
> 1. Facilitate the development of Bitcoin/ crypto, scrap AML / fraud prevention rules and let the criminals have an easy life
> 2. Continue to make life as difficult as possible for the criminals, with some inconvenience to the development of Bitcoin/ crypto
> Which option do you think the majority of citizens would choose? Exactly to your point, governments represent us all, that doesn't mean they implement legislation for us each individually.


Eh, when you WORD it like that, then no rational person would say boo to you.  However, there is more than one way to look at it.  If I was to tell you that criminals and paedo's are using the internet to carry on their illicit activity (as was bandied about when the web first emerged), based on your logic it should be shut down. 

I don't feel that citizens should be deprived of something that can advance society on some hyped up agenda of 'you can't because its the tool of criminals'.  Crypto does offer the potential to improve on aspects of current systems.  And again, you'd have heard Antonopoulos take this stance...and I whole heartedly agree with him. 



Leo said:


> What great value does crypto have that would outweigh the negatives of rolling back regulations?


Regulations have to keep up to pace with technology.  It's normal to have them updated to account for that.  That's why the industry in the U.S. - and progressive politicians in the U.S. are calling for new legislation to deal with crypto.  It's why some of the more progressive states in the U.S. (Wyoming) have passed a whole raft of laws in recent months to facilitate innovation.


----------



## tecate

And just to add ->  this.  <-

These guys are the standard bearers of the conventional financial world, right?


----------



## Duke of Marmalade

tecate said:


> And just to add ->  this.  <-
> 
> These guys are the standard bearers of the conventional financial world, right?


Fairly unbelievable really.  The bit that gets me is UBS getting off because they ratted on the others. Do the other guys now boycott UBS?


----------



## tecate

Duke of Marmalade said:


> The bit that gets me is UBS getting off because they ratted on the others.  Do the other guys now boycott UBS?


There's no honour amongst ....?.....pillars of corporate society.


----------



## EmmDee

tecate said:


> I'm not sure what it is you're looking for.   Crypto exchanges do implement KYC/AML.  I can't use a crypto exchange without doing the same identity verification as with a bank.  What are we even doing it for if I still can't move my funds?



Having seen the level of KYC expertise at a crypto broker and knowing someone who worked as a KYC person there - I can tell you they are not. They are playing at it - going through the motions. There is no expertise. It's usually the job of a junior person. It's box ticking with no oversight.

Just as a very simple example - they had concluded they needed reduced documentation from people from Costa Rica because it was a US territory and therefore could be treated as onshore US. So when basic geography is not understood, the complexities of multi-layered offshore trust vehicles are definitely not getting looked at


----------



## EmmDee

EmmDee said:


> Having seen the level of KYC expertise at a crypto broker and knowing someone who worked as a KYC person there - I can tell you they are not. They are playing at it - going through the motions. There is no expertise. It's usually the job of a junior person. It's box ticking with no oversight.
> 
> Just as a very simple example - they had concluded they needed reduced documentation from people from Costa Rica because it was a US territory and therefore could be treated as onshore US. So when basic geography is not understood, the complexities of multi-layered offshore trust vehicles are definitely not getting looked at



Just in case I wasn't clear - they didn't know the difference between Costa Rica and Puerto Rico


----------



## EmmDee

tecate said:


> Eh, when you WORD it like that, then no rational person would say boo to you.  However, there is more than one way to look at it.  If I was to tell you that criminals and paedo's are using the internet to carry on their illicit activity (as was bandied about when the web first emerged), based on your logic it should be shut down.
> 
> I don't feel that citizens should be deprived of something that can advance society on some hyped up agenda of 'you can't because its the tool of criminals'.  Crypto does offer the potential to improve on aspects of current systems.  And again, you'd have heard Antonopoulos take this stance...and I whole heartedly agree with him.



This is a straw man - nobody is saying "shut it down". The only thing being said is that if you want to bridge from one platform into the another, the rules of the platform have to be respected. Just as illegal activity on the internet is open to investigation and prosecution. You are creating a false binary argument that either it is a free-for-all or it is shut down. I could equally twist your position to be "internet regulation is bad so let paedos be paedos"

The position I am arguing is that crypto benefits from the checks and balances (and infrastructure) of the traditional banking industry inwards but doesn't want to play by the rules outwards (a "heads I win, tails you lose" scenario). So there is a risk (not absolute) that the outbound gets blocked (Different banks may take different approaches).


----------



## tecate

@EmmDee : The bottom line here is that by its inherent nature, crypto cannot provide a complete audit trail. One of it's key features is anonymity (and granted in the case of Bitcoin that may be psuedo anonymity but that's a debate for another day).   Exchanges can't provide information they simply don't have.
There's no point taking this discussion further in terms of second hand info you have from someone that once worked in the trade.  What I will say is that I know a lot of people who have delved in the crypto world.  It doesn't matter who I talk to, every single one of them has the same experience in terms of banks shutting down accounts.  It doesn't matter what exchange they use.
Now, it's a nascent industry.  Centralised exchanges have had a bad reputation (rightly) - but then they started off as informal traders.  However, I've seen them improve dramatically (even though I can't comment on the mechanics behind the scenes in terms of kyc/aml).

Notwithstanding that - lets take the biggest exchanges.  If you have $1 billion + companies - the chances are theyre going to take an increasing professional approach to business right?  What agenda do they have in not complying with regulation?  It's in their interests to comply.  Why wouldnt they?

Unless of course  the regulator simply isn't doing its job in terms of determining the actions of the bank or the actions of the exchange.  And lest you wonder why anyone associated with crypto wants regulation in this respect - exchanges are centralised - so they're no different to banks.  It makes complete sense that they be regulated.

And by the way, it has been identified by some states and some countries and some anti-competitive practice authorities that the banks are often simply discriminating against funds coming from that sector above and beyond regulations.  That's not coming from me - google it.  Multiple instances exist.  Governments and regulators act (or are supposed to act) in the interests of all of us.  If I - as a consumer - can't fully use a crypto exchange in relation to banking, then there should be a duty for them to disclose as much.  Put the information out there.  Which exchange can we use.  If you say that they're not complying with kyc/aml, then why are they not shutting them down then?

My guess is that the more professional and larger exchanges certainly are complying with these regulations.  However, someone somewhere is not satisifed with the way in which Bitcoin and cryptocurrencies work at a fundamental level.  The exchanges are not responsible for that.  So.....that's why its not a straw man argument from me as regards my call for them to either ban it or embrace it.  They have to make up their own minds,

And just as a final point, as regards rules having to be respected - in principal sure.  However, be aware that many times rules, laws etc have been enacted that have been ill conceived.  It seems many will just accept everything without ever once questioning anything.

Furthermore, it's quite common to have to update regulations to account for new technology.  This is no different.


----------



## EmmDee

@tecate...

I don't fundamentally disagree with what you say. If the "crypto industry" (sorry - I can't think of a better word) got together as a group (brokers, exchanges etc) and agreed to have standards on their customers (i.e. have a full record of the customers as they come into the crypto world) they could probably make a good case for cooperation with the mainstream banking industry without having to track each transaction fully. But to do that it would require coordinated industry standards. Currently the work of a diligent well run exchange is completely undermined by a careless "fly-by-night" as funds can enter by the later and leave by the former.

Banks have been adapting to change and new technology for centuries. People refer to SWIFT when thinking of the "payments rails" but most banks are supporting a dozen different infrastructures - some dating back decades and some completely new (including blockchain). It isn't a fear of new technology. Most of the large international banks have a much larger tech and fintech element than you seem to give credit for.

I also agree that regulations have to change and adapt. That shouldn't really be too difficult in fact. But generally what doesn't happen is that the principles involved don't change (e.g. preventing proceeds of crime from moving through the mainstream financial system). Your difficulties (if I take you as an example of the broader issue) won't really be addressed by changes in procedures unless the principle the bank is applying is thought about and addressed by the exchanges. If that happens, the practical details can adjust very quickly.


----------



## tecate

@EmmDee  On the term 'crypto industry', that works just fine.  I'm quite happy to accept it has been the wild west and still has issues to sort out but it's definitely a fully fledged industry in its own right at this point.  As regards self-regulation and industry standards, I agree completely.  The  Virtual Commodities Association was set up in August with that in mind. 

The top exchanges are no different than conventional financial services businesses at this point as many of them are now partly owned by established conventional companies.  Kraken employ 200 people on kyc/aml.  Only 12 months ago, all of the exchanges failed.  There has been a lot of work put in between then and now and it can be seen.  There's no doubt that there's tonnes of work still to be done.  However, that's needed on the regulatory side too. 

As regards banks and tech, I don't disagree.  Them having the tech isn't the issue.  Their focus is for their good.  As an example, bank of america has been patent trolling like theres no tomorrow.  They have more blockchain/crypto related patents than any other company in the world.  Yet their CTO came out the other day and rubbished blockchain technology.   They will use it when necessary OR will block others from using it.
SWIFT is an abomination.  The tech has existed for years to do away with it but they're only starting to react now - with blockchain/crypto coming down the tracks.  Not only have they made fat money off it, consumers and businesses have been getting hit on the double - i.e. its both expensive and inefficient/cumbersome.

Regulatory clarity is needed.  It would sort out all of this (regardless of whether they take a hard line or innovation-friendly line). 

As regards the principles of a policy not changing, I'd imagine that normally they don't.  However, this scenario is quite different due the inherent nature of decentralised crypto.  They will have to make a decision on it one way or the other - the sooner the better.


----------



## Gus1970

Duke of Marmalade said:


> I fully understand the rationale behind bitcoin mining, thanks to _fpalb_.  Perhaps you misunderstood my point, it happens.
> I ridiculed the zillions of running the SHA algorithm on a trial and error basis until you get an answer.  You countered by pointing out that EVERYTHING comes from trial and error.  I presumed you were referring to R&D but possibly you had something else in mind, please clarify.  I counter countered that the progress garnered from R&D trial and error could in no way be compared with the mind numbing “Proof of Work” nonsense in the bitcoin protocol.
> Also can you explain in more detail why the fully anticipated halving of the rate of increase in bitcoin supply would fuel bullish speculation as the halving approaches?


Hi. Do you have a better POW algorithm? I’d be interested in reviewing it. Thanks


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## Gus1970

Duke of Marmalade said:


> I think I’ll buy this “halving” thing being a significant if somewhat irrational factor in the uptick.


If you look at the historical price movements you will see a clear relationship between each of the halvings and price. There can be  method in irrationality


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## Duke of Marmalade

No.  I was just reflecting that some nerds like crypto for its aesthetic beauty.  As technology goes it is downright ugly IMHO but then beauty is...


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## tecate

Duke of Marmalade said:


> No.  I was just reflecting that some nerds like crypto for its aesthetic beauty.  As technology goes it is downright ugly IMHO but then beauty is...


This is the technology behind a network which has been online for every second in excess of 10 years and never been hacked?  Never been offline.  Hard to see the 'ugly' in that.


----------



## Gus1970

Duke of Marmalade said:


> No.  I was just reflecting that some nerds like crypto for its aesthetic beauty.  As technology goes it is downright ugly IMHO but then beauty is...



Cool, thanks. Are you in tech?


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## Gus1970

tecate said:


> This is the technology behind a network which has been online for every second in excess of 10 years and never been hacked?  Never been offline.  Hard to see the 'ugly' in that.


It’s up to you what to see, it’s your eyes and your universe. You can find beauty and ugliness in anything in this world, the latter being very easy to find, the former requiring much more effort.


----------



## Duke of Marmalade

I have conceded that beauty is in the eye of the beholder. For me the use of Einstein's General Theory of Relativity in GPS technology is both beautiful and very useful for wo/mankind.
But there do seem to be folk who get their kicks from the performance of zillions of one way crypto puzzles.  They also perceive great utility in having a secure digital entry on an open ledger, albeit it signifies nothing. In fact if it had some material significance I think that would detract from their "beauty".


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## tecate

Duke of Marmalade said:


> They also perceive great utility in having a secure digital entry on an open ledger, albeit it signifies nothing.


So with this, you're not just dissing Bitcoin but all of blockchain technology in its entirety.   



Duke of Marmalade said:


> In fact if it had some material significance I think that would detract from their "beauty".


With tongue wedged in cheek, you referenced 'one way crypto puzzles'.  You seem to be speaking in one way riddles yourself.


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## Duke of Marmalade

tecate said:


> So with this, you're not just dissing Bitcoin but all of blockchain technology in its entirety.


Yep.  It's very low brow tech compared to all the marvels we see in our everyday life.


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## tecate

Duke of Marmalade said:


> Yep.  It's very low brow tech compared to all the marvels we see in our everyday life.


So alongside your claim of Bitcoin ending up with a value of zero very soon, have all  of these companies made the same mistake with blockchain tech?  All the time and money they've spent on that thus far - will have been wasted in your view?


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## Gus1970

Duke of Marmalade said:


> Yep.  It's very low brow tech compared to all the marvels we see in our everyday life.


A ferrari is ugly because to drive its engine needs to cause controlled headless explosions, over and over, how ugly!


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## Leo

Gus1970 said:


> A ferrari is ugly because to drive its engine needs to cause controlled headless explosions, over and over, how ugly!



That's a complete strawman right there!


----------



## tecate

Leo said:


> That's a complete strawman right there!


So he's responding to an implicit insinuation that blockchain technology as a whole has no utility and your focus is on the latter statement?  
Should we surmise from that then that you're joining with his Dukeness and saying that blockchain as a complete technology has no utility?

If so, these posts won't age well for either of you.


----------



## Leo

tecate said:


> So he's responding to an implicit insinuation that blockchain technology as a whole has no utility and your focus is on the latter statement?
> Should we surmise from that then that you're joining with his Dukeness and saying that blockchain as a complete technology has no utility?
> 
> If so, these posts won't age well for either of you.



That isn't what he said. Even if he was, that argument is still one of the best examples of a strawman I have seen in quite some time.

From my calling that out, you surmise that I think blockchain has no utility? That's some leap, and also completely inaccurate.


----------



## tecate

Leo said:


> That isn't what he said. Even if he was, your argument is still one of the best examples of a strawman I have seen in quite some time.


It's what he insinuated - and him not clarifying, leaving it hanging there adds to that.



Leo said:


> From my calling that out, you surmise that I think blockchain has no utility? That's some leap, and also completely inaccurate.


I didn't 'surmise' - I posed something as a question.


----------



## Leo

tecate said:


> It's what he insinuated - and him not clarifying, leaving it hanging there adds to that.



That's not how I read it at all. Forming a conclusion on a lack of information is only likely to lead you to your own viewpoint, not others.



tecate said:


> I didn't 'surmise' - I posed something as a question.



Fair enough, so to answer that question, no, you shouldn't surmise that at all. I've confirmed as much multiple times in this forum.


----------



## tecate

Leo said:


> That's not how I read it at all. Forming a conclusion on a lack of information is only likely to lead you to your own viewpoint, not others.


Well then I guess we disagree.   Semantics - I didn't use the word 'conclusion'.  The term I used was 'implicit insinuation' and I stand by that.  



Leo said:


> Fair enough, so to answer that question, no, you shouldn't surmise that at all. I've confirmed as much multiple times in this forum.


Ok, so you;'re telling me not to do something I didn't do?  Understood.
Thank you for acknowledging that blockchain is a legitimate, progressive technology in its own right.


----------



## Leo

tecate said:


> Ok, so you;'re telling me not to do something I didn't do? Understood.



Seriously? You originally said: 



tecate said:


> Should we surmise from that then that you're joining with his Dukeness...


To which I replied


Leo said:


> no, you shouldn't surmise that at all.



Should I not answer questions or are you developing TBS deflection syndrome?



tecate said:


> Thank you for acknowledging that blockchain is a legitimate, progressive technology in its own right.



You're very welcome, but where did I say it was progressive?


----------



## tecate

@Leo :  You're misleading matters.  The statement that you quote had a question mark at the end of it - that you've shaved off.

And your last statement - more semantics.  If you answered the question directly in the first place other than to say that you referred to blockchain tech on previous instances, then there would be no room for confusion.


----------



## Duke of Marmalade

Taking a deep breath and diving into this rabbit hole
T, I did not say it has NO utility.  I seem to recall from the last time this theological dispute surfaced about 18 months ago that I would put its utility on a par with the Arch Lever file to which  I think I was corrected to Lever Arch file, and to be sure the LAF has been a great boon to lawyers' offices across the globe.  But compared to GPS, Air Travel, Satellite Television, Internet search engines, sliced bread, and of course the sheer beauty that is a Ferrari, it just does not cut it for me.  I fully accept that others see it on a par with these amazing technologies.
But the origin of this current rabbit hole was not in fact my dispute as to its utility but my surprise that some actually find the basic algorithm a thing of beauty.  I think even Satoshi would have come up with something better if she had known that things would turn out the way they have.  As I understand it, and it is a while since I examined the details, the outlandish intensity of the algorithm is not because that is what is required to secure the blockchain but because it is needed to slow down the miners.  I presume Satoshi never thought mining would be so lucrative with a bitcoin being worth thousands of dollars.


----------



## Leo

tecate said:


> @Leo :  You're misleading matters.  The statement that you quote had a question mark at the end of it - that you've shaved off.



So on semantics, then it was a question and not a statement. I wasn't in doubt that it was a question, and as quoted in my last post, I answered that question. You then sad that answer was 'telling me not to do something I didn't do? '. 



tecate said:


> And your last statement - more semantics.  If you answered the question directly in the first place other than to say that you referred to blockchain tech on previous instances, then there would be no room for confusion.



You seemed to have missed the fact that I did answer the question, the reference to previous posts was merely further emphasis. 

So again, where did I say blockchain was progressive?


----------



## tecate

Leo said:


> So on semantics, then it was a question and not a statement. I wasn't in doubt that it was a question, and as quoted in my last post, I answered that question. You then sad that answer was 'telling me not to do something I didn't do? '.


You want to continue on with the semantics and hyperbole, then on we go I guess.  
Picking this up from post #134 onwards, where did you state directly in support of blockchain technology?



Leo said:


> You seemed to have missed the fact that I did answer the question,


Where is that direct statement?


Leo said:


> So again, where did I say blockchain was progressive?


It's the very same answer as before.  I don't really respect you coming on with this nonsense when you failed to make a direct statement.  It had to be teased out of you - and then you start on me for the use of a certain adjective.  
If you want to continue going round in circles, on we go.


----------



## tecate

Duke of Marmalade said:


> T, I did not say it has NO utility.  I seem to recall from the last time this theological dispute surfaced about 18 months ago that I would put its utility on a par with the Arch Lever file to which  I think I was corrected to Lever Arch file, and to be sure the LAF has been a great boon to lawyers' offices across the globe.  But compared to GPS, Air Travel, Satellite Television, Internet search engines, sliced bread, and of course the sheer beauty that is a Ferrari, it just does not cut it for me.  I fully accept that others see it on a par with these amazing technologies.


I guess you have not seen the extent of its utility - and perhaps its because a lot of that utility will go unnoticed by ordinary people (despite being highly significant).  Placing it on the level of a LAF could only mean you're missing most of that utility and use case.



Duke of Marmalade said:


> But the origin of this current rabbit hole was not in fact my dispute as to its utility but my surprise that some actually find the basic algorithm a thing of beauty.  I think even Satoshi would have come up with something better if she had known that things would turn out the way they have.  As I understand it, and it is a while since I examined the details, the outlandish intensity of the algorithm is not because that is what is required to secure the blockchain but because it is needed to slow down the miners.  I presume Satoshi never thought mining would be so lucrative with a bitcoin being worth thousands of dollars.


That consensus mechanism - whilst controversial - provides for a network that has never been offline since inception and never been hacked.  Why would you even care about how it works?  What difference does it make so long as it achieves what it sets out to achieve?


----------



## Duke of Marmalade

tecate said:


> That consensus mechanism - whilst controversial - provides for a network that has never been offline since inception and never been hacked.  Why would you even care about how it works?  What difference does it make so long as it achieves what it sets out to achieve?


Dearie me these blog debates can be so frustrating.  It is probably my fault but you have completely missed my arguments.  I have drawn a clear distinction between its utility and its inner works.  Its utility is modest IMHO compared to some of the technologies I have cited.  Its inner workings are downright ugly IMHO.  My point was that some people are bowled over like yourself by its utility whilst some (nerds, though I don't think yourself) regard the algorithm as a thing of beauty.


----------



## Leo

tecate said:


> You want to continue on with the semantics and hyperbole, then on we go I guess.
> Picking this up from post #134 onwards, where did you state directly in support of blockchain technology?



You keep misunderstanding me for some reason, so I'll keep trying...

In post #138, I said you were wrong to surmise that I thought blockchain had no utility. How is that not clear?



tecate said:


> Where is that direct statement?



Again, see above. 



tecate said:


> It's the very same answer as before.  I don't really respect you coming on with this nonsense when you failed to make a direct statement.  It had to be teased out of you ....



It's in my second post, that's teasing it out of me?


----------



## tecate

Duke of Marmalade said:


> Dearie me these blog debates can be so frustrating.  It is probably my fault but you have completely missed my arguments.  I have drawn a clear distinction between its utility and its inner works.  Its utility is modest IMHO compared to some of the technologies I have cited.  Its inner workings are downright ugly IMHO.  My point was that some people are bowled over like yourself by its utility whilst some (nerds, though I don't think yourself) regard the algorithm as a thing of beauty.


I don't think there's any misunderstanding.  We disagree on the extent of the utility of blockchain technology.   i.e. the notion that it is so limited as to have the utility / impact akin to a LAF is something I disagree with.   As regards to what extent I'm 'bowled over', that remains to be seen. I have an interest in and I'm excited about other technologies too including but not limited to AR/VR/AI, etc.  
In terms of the 'beauty' of an algorithm, what does that even mean?  It is functional and is key in contributed to a system that provides for an immutable, secure public ledger.  Nothing 'sexy' about that at all - but it has implications in terms of use case.  ..and If I am to see any 'beauty' its in terms of utlimate use case.


----------



## tecate

@Leo - you made no direct statement in support of blockchain technology from post no. 134 onwards.  Now, I'd suggest we park this up - as going round in semantic circles is not going to benefit anyone.  However, if you want to continue, then we will continue as I don't tend to leave any discussion unanswered.


----------



## Leo

tecate said:


> I guess you have not seen the extent of its utility - and perhaps its because a lot of that utility will go unnoticed by ordinary people (despite being highly significant).



Blockchain has been around in various guises since the early '90s. It's hype soared with the inception and subsequent scramble to get on-board the Bitcoin craze It has attracted massive investment from some of the biggest players in technology, there are quite a few applications live outside the crypto space, but such applications are never likely to challenge the Duke's example of GPS in terms of utility that some seem to think it will achieve.


----------



## Leo

tecate said:


> @Leo - you made no direct statement in support of blockchain technology from post no. 134 onwards.  Now, I'd suggest we park this up - as going round in semantic circles is not going to benefit anyone.  However, if you want to continue, then we will continue as I don't tend to leave any discussion unanswered.



My correction is a direct statement, it contains a negative, but it is still a direct statement. 

Blockchain has utility = to state blockchain has no utility is incorrect!


----------



## tecate

Leo said:


> Blockchain has been around in various guises since the early '90s. It's hype soared with the inception and subsequent scramble to get on-board the Bitcoin craze It has attracted massive investment from some of the biggest players in technology, there are quite a few applications live outside the crypto space, but such applications are never likely to challenge the Duke's example of GPS in terms of utility that some seem to think it will achieve.


All technologies suffer from a hype cycle.  AI/VR/AR/IoT have been knocking around quite some time also...and suffer the same hype cycle.  Utility is in the eyes of the beholder.  Many of the use cases for blockchain will go unnoticed by ordinary people.   Are there technologies that will have or have had greater impact? Probably (and I'll stick with probably until the whole tech gets unpacked in the final analysis).  In terms of Bitcoin and its implication as a store of value/currency/unit of account - that potentially has far reaching implications.  Of course, you can assume that it will get nowhere with that suggested utility (and maybe you will be right but I'm not in any way accepting that as guaranteed outcome right now). However, should it gain traction, you're talking about a change in the way we exchange/trade value - which is a fundamental cornerstone of human activity.  

Quite happy to consider it not being the most impactful technology to come along but to put it on a par with the LAF is a long way wide of the mark.


Leo said:


> My correction is a direct statement, it contains a negative, but it is still a direct statement.
> 
> Blockchain has utility = to state blockchain has no utility is incorrect!


Ah, a direct statement to the negative.  Right, Leo.


----------



## Leo

tecate said:


> All technologies suffer from a hype cycle.  AI/VR/AR/IoT have been knocking around quite some time also...and suffer the same hype cycle.  Utility is in the eyes of the beholder.



The hype cycle thing does happen a lot of technologies alright, VR/ AR certainly caught people's imaginations, but it was perceived utility that drove the hype in those cases. Blockchain though didn't really excite too many people until Bitcoin came along and got a lot of people excited about how it was going to make them rich. I disagree with utility being in the eye of the beholder though, utility should always have a measure. If it can't be measured, it's something else.



tecate said:


> Many of the use cases for blockchain will go unnoticed by ordinary people.   Are there technologies that will have or have had greater impact? Probably (and I'll stick with probably until the whole tech gets unpacked in the final analysis).



As a concept, blockchain isn't at all complex, it is a very neat idea that has come of age as the internet has developed, and has multiple applications, but I don't rate it that highly in terms of technological achievements.



tecate said:


> In terms of Bitcoin and its implication as a store of value/currency/unit of account - that potentially has far reaching implications.  Of course, you can assume that it will get nowhere with that suggested utility (and maybe you will be right but I'm not in any way accepting that as guaranteed outcome right now). However, should it gain traction, you're talking about a change in the way we exchange/trade value - which is a fundamental cornerstone of human activity.



I'm on record here (that phrase again ) saying I don't believe Bitcoin will be successful and will ultimately fail, I base that on my understanding of its technical constraints and limitations, which I find a little on the crude side. I've been wrong before, I'll be wrong again, we'll see how that prediction will fare in time. That's not to say cryptocurrency will never take off, just that I don't believe Bitcoin will be the solution if and when it does.

Again, it comes back to the utility, what problem are we trying to resolve. I share the Antonopulos view that crypto could solve a very significant problem in situations like people living in corrupt states where governments or the banking system cannot be trusted. But for the majority of the world, we can already transact with pretty much anyone else we choose at very low cost and with instant confirmation, and significant consumer protections when things go wrong. So I don't see what value it has to offer me as a currency.



tecate said:


> Quite happy to consider it not being the most impactful technology to come along but to put it on a par with the LAF is a long way wide of the mark.



I'd put blockchain well ahead of LAF too, maybe someone filing all day might differ, but I'm a technology guy, and think paper filing is outdated.



tecate said:


> Ah, a direct statement to the negative.  Right, Leo.



Basic arithmetic, negative x negative = positive


----------



## tecate

Leo said:


> Blockchain though didn't really excite too many people until Bitcoin came along and got a lot of people excited about how it was going to make them rich. I disagree with utility being in the eye of the beholder though, utility should always have a measure. If it can't be measured, it's something else.


A huge amount of froth and noise around BTC/Crypto when it comes to the greed component.  Agreed.  It's not in any way a 'sexy' tech.  It's quite boring but it can and is finding use cases in many fields.  The majority implicate business processes - not mass market applications.  Society can benefit from that - but clearly not as directly as some other technologies.  If it's deemed to be less significant in terms of impact as opposed to Technologies B, C or D - I'm not going to object to that.   I don't really care.  The point is that it's still a relevant tech with some use cases already in play, many at pilot stage and more as yet unclear/undeveloped.



Leo said:


> As a concept, blockchain isn't at all complex, it is a very neat idea that has come of age as the internet has developed, and has multiple applications, but I don't rate it that highly in terms of technological achievements.


It's incredibly lacking in complexity upon initial consideration.  It's an immutable, public database..   Again, I don't really care where it ranks in terms of technological achievements.  I mean, what would the metric be for that anyway?  Depends on what's important to you.  It's still a highly significant tech.  On that metric, Jobs wasn't at the races but he brought about change due in large parts to simplicity.



Leo said:


> I'm on record here (that phrase again ) saying I don't believe Bitcoin will be successful and will ultimately fail, I base that on my understanding of its technical constraints and limitations, which I find a little on the crude side. I've been wrong before, I'll be wrong again, we'll see how that prediction will fare in time. That's not to say cryptocurrency will never take off, just that I don't believe Bitcoin will be the solution if and when it does.


That's speculative - and is open to debate both within and outside of crypto circles.  As things stand, I think it will maintain and build on its position - but I can't say I'd be surprised if we revisit this in a couple of years and things have changed in that regard.  At the moment, I see it's relevance staying on track but I reserve the right to change my mind on that one as things progress.



Leo said:


> Again, it comes back to the utility, what problem are we trying to resolve. I share the Antonopulos view that crypto could solve a very significant problem in situations like people living in corrupt states where governments or the banking system cannot be trusted. But for the majority of the world, we can already transact with pretty much anyone else we choose at very low cost and with instant confirmation, and significant consumer protections when things go wrong. So I don't see what value it has to offer me as a currency.


Where there are people there are variables and whilst there are more pressing use cases in the developing world, we're not beyond benefiting from it closer to home.  The most place I'd like to see blockchain tech being used is in all government systems - showing a complete trail of $.  But of course, Turkey's don't vote for Christmas so we'll be waiting for that to filter in - for a long, long time to come.  Look at the scandals we've had around charities in Ireland?  And that's on our end.  In the receiving countries, so much charity money and aid goes 'missing'.  That's why the U.N. has been collaborating with a couple of the crypto projects to tackle that (as well as identity projects). 
I could look at my last few years in Ireland and see that I'd have little use for crypto on a day to day basis  - so no argument there.  That said, in the last year, it would have been a tonic (but it's not ready yet either until it is being moved around in more volume).  There's plenty wrong with the movement of money internationally from the perspectives of cost/time and this bureaucratic paperchase that's implicated in it (i.e. aml/kyc).

Other than that, given the opportunity (i.e. once volatility diminishes or a stablecoin exists that can be trusted), then I will custody my own money.  I'm not having anyone lock an account or take funds from an account without my consent - or have a government or bank take that money.  People think that sort of stuff doesn't happen in western countries but its only a short while ago we were ever so close to it.

Lastly, in terms of privacy, most people don't give a monkeys or they simply get jaded and give in to whatever the convention is.  When cash goes (and regardless with what happens with decentralised crypto, someday soon there will be central bank digital currency), the details of every single transaction a citizen ever makes will be available to some cretin(s) in public administration and government bodies.  Secondly, run into an issue with someone at that level and your entire wealth could simply be switched off in an instant.  I don't see that as a healthy scenario.



Leo said:


> I'd put blockchain well ahead of LAF too, maybe someone filing all day might differ, but I'm a technology guy, and think paper filing is outdated.


I'll take that as a 'progressive' move forward in the discussion.  :-D


----------



## Firefly

tecate said:


> I don't tend to leave any discussion unanswered.



That's true tecate. You & Folsom are quite the pair!


----------



## Firefly

Duke of Marmalade said:


> Taking a deep breath and diving into this rabbit hole


----------



## tecate

Firefly said:


> That's true tecate. You & Folsom are quite the pair!


 You're more than welcome, Firefly.


----------



## Gus1970

Leo said:


> That's not how I read it at all. Forming a conclusion on a lack of information is only likely to lead you to your own viewpoint, not others.



That’s spot on, i am glad you acknowledge it man.


----------

