# Bitcoin in a hyperbolic bubble



## Duke of Marmalade

Thanks to @tecate I have a new Twitter hero, Nouriel Roubini.  Here he is on the latest bitcoin madness.

https://www.youtube.com/watch?v=6Re-PzNEMvc 



			
				Yahoo Finance said:
			
		

> Famed economist Nouriel Roubini says that Bitcoin and other cryptocurrencies, which he’s dubbed as “sh-tcoins,” have no place in retail or institutional investor portfolios.
> 
> Roubini, a professor of economics at NYU’s Stern School of Business, slammed Bitcoin (BTC-USD) as it has hit recent highs and was last trading above $23,300.
> 
> “First of all, calling it a currency — it’s not a currency. It’s not a unit of account, it’s not a means of payment.…it’s not a stable store of value. Secondly, it’s not even an asset,” Roubini said.
> 
> According to Roubini, Bitcoin has no intrinsic value. He pointed out that assets — bonds, stocks, real estate, or precious metals — either provide income, capital gains or some form of utility.
> 
> “While in the case of Bitcoin, there is no income,” he said. “There is no use. There is no utility. The only thing is a speculative, self-fulfilling kind of rise, and that rise is driven totally by manipulation.”
> 
> Roubini noted that there’s academic research to suggest that “this pseudo stable coin Tether has been created by fiat” and is “used literally to manipulate the price of Bitcoin.”
> 
> “The price of Bitcoin is totally manipulated by a bunch of people, by a bunch of whales. It doesn’t have any fundamental value,” he said. “We’re close to the point where the hyperbolic bubble is going to go bust.”


This is a renowned economist talking.  Are there any respected economists making the case for bitcoin?  Ironically the amazing bitcoin performance of 2020, from 10k to 4k to 30k(?) spells its early demise.  A nice steady performance would have been more indicative that bitcoin had come of age and was here to stay.  2017 was a similarly ridiculous year and it was followed by the collapse from 20k to 3k in 2018.


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## WolfeTone

Ah Duke, you couldn't even wait until NY to end the bitcoin ceasefire .



Duke of Marmalade said:


> Are there any respected economists making the case for bitcoin?



I would be inclined to engage only I am hesitant that your definition of "respected economist" may only reach as far as those economists that share your view about Bitcoin?

I will put it to the test so. Would a senior economist at say, the Bank of Chicago, like François Velde, qualify as a "respected economist"?
In 2013, he wrote_ 

"Should bitcoin become widely accepted, it is un-
likely that it will remain free of govern-
ment intervention, if only because the 
governance of the bitcoin code and net-
work is opaque and vulnerable. That said, 
*it represents a remarkable conceptual and 
technical achievement, *which may well 
be used by existing financial institutions 
(which could issue their own bitcoins) 
or even by governments themselves" _

Not a resounding endorsement, but in 2013, surely a more open-minded lead in the field of economics?

As for Roubini, he is indeed a respected economist. Here is the interview, I think, that is quoted.

Nouriel Roubini and bitcoin
After about 1m 40sec.

From my perspective he is not saying anything new that has not been said over the last decade. He is, however, brazenly ignoring the points of increasing institutional investment being made by the presenter in her opening remarks.

My sense is that the smirk on the interviewers face toward the end of the interview is most telling. While being dutifully respectable to Roubini, I can't help sense that she has _"crazy old fool!" _written all over her face.


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## Duke of Marmalade

Hi _theo  _Happy New Year to you.  Thanks for posting that video clip, I thought of posting it myself but was wary that maybe the strong language would be in breach of AAM rules.  I recommend everyone to watch it as he says much more than the extract which I quoted.  The passion with which he damns sh1tcoins is really persuasive and yes it caused amusement for the interviewer which I didn't read as ageist contempt. 
The 2013 quote from an economist employee at a bank does not impress me.  Is there even one professor who would speak so passionately about the huge boon for humanity that crypto cultists proclaim it to be.
It's all been said before for sure, for example by myself.  But clearly some people are not convinced by what seems to me so ble*ding obvious, so I am not going to fault him for repeating it.


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## WolfeTone

And HNY to you Duke. 
Im not doubting the passion of Nouriel nor dismissing his credentials as an economist. There are valid reasons as to why I didn't get involved until 2017 when it was circa $2,800, albeit learning of its existence when it was $80! 

However_, _my doubts about Bitcoin have reduced greatly since my first venture into it. 
There are valid reasons for this, all the forecasts of its demise - government regulation, banning, BOHA, criminality etc have not materialised. And, to my knowledge, there is no other ponzi, bubble, scam (choose your own metaphor), in financial history that has produced anything like the price action of bitcoin. 
Secondly, I have bitcoin, I have bought it, sold it, and in recent times invested it and received a return, in BTC.

Thirdly, is the adoption of institutional investors into bitcoin. This is a significant game-changer in my view. And it's why it's disappointing, but probably not unexpected, that the views of a senior economist are not taken seriously. As far back as 2013 economist François Velde wrote about possible adoption of financial institutions using bitcoin. His paper on bitcoin is as an objective a piece I have read about Bitcoin from anyone. He neither endorses nor dismisses it, and it can be argued if he actually understands it. Regardless of his pros and cons, or general understanding, it is clear to me that he understands something of significance has occurred. 

And finally back to Nouriel. It was his clear avoidance of the substance of the question being put to him (the adoption of institutional investors of bitcoin) and his reversion to the mantra of the last decade which devalues his own standing as someone who can talk authoritatively on the subject. More so, when there are economists who were producing greater insights and analysis deserving of respect back in 2013.


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## Brendan Burgess

Guys, the last few threads became pointless after about 10 pages , so I closed them off and deleted a few more posts which reopened the debate. 

tecate offered to do a balanced pros and cons of Bitcoin post and I was hoping to suspend discussion until this was done. But he hasn't produced it yet. 

I do think that the hyperbolic rise is worth discussing. 

I don't know how it can be done without just repeating _ad nauseam _what has already been said. 

At least, please make sure to avoid any personal attacks on each other. 

Brendan


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## Colm Fagan

I've not contributed much to this discussion, but I found that interview with Roubini compelling.  Could anyone enlighten me on his allegation that there is criminal activity, in the form of front-running, etc.?  That would help to change the focus slightly, and hopefully satisfy Brendan's aspiration to move on from the previous mud-slinging.


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## Duke of Marmalade

WolfeTone said:


> As far back as 2013 economist François Velde wrote about possible adoption of financial institutions using bitcoin. His paper on bitcoin is as an objective a piece I have read about Bitcoin from anyone.


I decided to read François.  I see he is an employee of a Federal Reserve bank and therefore less likely to have a commercial motive, so I must take him seriously.  His paper and his admiration for bitcoin is mainly based on his appreciation of the technology.  Very little is said about the economic substance which Roubini rubbishes so forcibly.  The following is his full conclusion.





			
				François Velde in 2013 said:
			
		

> Conclusion So far, the uses of bitcoin as a medium of exchange appear limited, particularly if one excludes illegal activities. It has been used as a means to transfer funds outside of traditional and regulated channels and, presumably, as a speculative investment opportunity. People bet on bitcoin because it may develop into a full-fledged currency. Some of bitcoin’s features make it less convenient than existing currencies and payment systems, particularly for those who have no strong desire to avoid them in the first place. Nor does it truly embody what Hayek and others in the “Austrian School of Economics” proposed. Should bitcoin become widely accepted, it is unlikely that it will remain free of government intervention, if only because the governance of the bitcoin code and network is opaque and vulnerable. That said, it represents a remarkable conceptual and technical achievement, which may well be used by existing financial institutions (which could issue their own bitcoins) or even by governments themselves.


As you say, hardly a ringing endorsement.  If that is the intellectual case for the defence (of btc) then I am afraid this jury member is voting guilty as charged (by Roubini).
Note in particular that his whole article is about bitcoin making the grade as a currency.  It has completely lost its way in that endeavour - it will never be a currency.


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## Duke of Marmalade

Colm Fagan said:


> I've not contributed much to this discussion, but I found that interview with Roubini compelling.  Could anyone enlighten me on his allegation that there is criminal activity, in the form of front-running, etc.?  That would help to change the focus slightly, and hopefully satisfy Brendan's aspiration to move on from the previous mud-slinging.


Colm, yes I was fascinated by his charges of manipulation.  Don't know what front-running is but most intriguing is this Tether thing.  Tether is unusual as a crypto in that it is linked to the dollar.  I don't know exactly what Roubini is suggesting but its along the lines that in crypto land Tether *is *the US dollar.  I think he is saying that Tethers are being created without any actual dollar backing and then used to support the bitcoin price.  If he is right and there is currently a criminal investigation into that possibility we might get a denouement very soon.


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## TheBig40

I think the front running he is talking about in the video is when Bots see a larger order placed and buy up crypto just ahead of the big purchase and sell it just after so they benefited from the brief marginal gain in price. It’s seem to be a focus at the moment to find ways of stopping this from happening. Seems reminiscent of brokers training to install IT infrastructure closer and closer to the exchanges etc.


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## WolfeTone

Duke of Marmalade said:


> His paper and his admiration for bitcoin is mainly based on his appreciation of the technology.



Yes.



Duke of Marmalade said:


> If that is the intellectual case for the defence (of btc)



Not at all. The question was "are there any _respected_ _economists _making the case for bitcoin?"

Admittedly, I have not found any _mainstream_ _economists_ putting their weight and reputation behind bitcoin. But then again, Im familiar with maybe only a dozen or so such economists. And, from a profession that can't even agree with itself alot of the time, it's a peculiarity to me why so much value is placed in their opinion on bitcoin. That is not to disparage their views, but from my understanding of bitcoin, what we are talking about is a new technology for transmitting money securely without third party interference. This has value. The _price _applicable to that value is what appears to be contentious amongst the economists.

That is why Veldes paper is interesting somewhat as, one, he is an economist (as requested) and, two, he recognises the technology of bitcoin rather than focus on the price action.

(_I'm cognisant here of Brendans forewarning of discussing ad nauseam what has already been said)._

The 'hyperbolic' price of bitcoin is with regard to failures of global central bank monetary policy and subservient sovereign states that facilitate these policies that are distorting and manipulating price valuations across a range of sectors.

As long as such systems prevail, then a demand for a decentralised monetary network will exist - more so, now, that it has been invented.
Whether it is bitcoin that prevails, or another, time will tell.
The extent of adoption is anybodys guess, but currently the demand for such a system places BTC at around $28,000, or $500bn market for its 18m or so coins in circulation.
In the global scheme of the financial sector, it is tiny and its scope for greater adoption is massive, in my opinion.


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## Duke of Marmalade

WolfeTone said:


> That is not to disparage their views, but from my understanding of bitcoin, what we are talking about is a new technology for transmitting money securely without third party interference. This has value.


Yes it would have value if bitcoin was "money".  As Roubini so passionately explains bitcoin is not money. 



> The extent of adoption is anybodys guess, but currently the demand for such a system places BTC at around $28,000, or $500bn market for its 18m or so coins in circulation.
> In the global scheme of the financial sector, it is tiny and its scope for greater adoption is massive, in my opinion.


Adoption?  Adoption as what?  Certainly not as a medium of exchange i.e. money as intended and as described by Veldes.  That speculators in  a frenzy of FOMO induced by whales' manipulation is not adoption.  And yet this argument is frequently used to talk up the potential of cryptos.  It is completely bogus IMHO.  
Though I will concede my dear _theo_ that your prediction of 35k may indeed mark the zenith of this madness before the bubble bursts.


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## WolfeTone

Duke of Marmalade said:


> Adoption? Adoption as what? Certainly not as a medium of exchange i.e. money as intended and as described by Veldes.



I have no qualms in recognising that bitcoin has failed, to date, to act as a medium of exchange in the general sense as we understand it. But I'm prepared to argue it's _potential _to act as a medium of exchange does exist.
It is of course along way, way off reaching that holy grail, if ever. But its current trajectory - in the form of increasing numbers of people, and now corporate institutions, owning bitcoin, lends weight to the possibility of it being a medium of exchange at some point.
The € was the most recent adoption of a new currency in recent times. Quite a seamless introduction and adoption imo. But the € had considerable infrastructure in place prior to its introduction not least, legislation of 18 EU countries, printing presses, an established banking sector, widespread public knowledge and preparation, etc
Bitcoin has had none of this. It is a 9 page whitepaper posted as a blog on some fringe techsite in 2008.
That it is now a long-running saga not only on AAM but with some of the world's most respected economists and financiers is an incredible achievement.

The only conclusion I can come to is, like Veldes, is that  "bitcoin remains a _remarkable _conceptual and technical achievement" - this is not the general economist description of something with no intrinsic value?
It is clear, to me, that is the descriptive of something _of_ intrinsic value.
What the price attributable to that is what appears to be contentious.



Duke of Marmalade said:


> That speculators in a frenzy of FOMO induced by whales' manipulation is not adoption.



Assuming for the moment that the price is being manipulated by 'whales' to create a FOMO frenzy.
Is there any such commodity, good or service, with no intrinsic value, throughout the history of the world, that has experienced the price action of bitcoin in such a manipulated way that didn't return to zero on being exposed as such?
I do not know of any.

In fact, what Roubini is referring to is nothing more than an apparently long established price manipulation tactic that is pervasive throughout financial transactions and the industry in general. I'm no expert in these matters but at a simple level you can prove price manipulation - Eg buying large amounts of stock in advance of information coming to the market in the expectation that such information will drive the price of stock up significantly. It is harder to prove price manipulation with intent to deceive, criminal intent.

What information (insider or otherwise) do the 'whales' have that prompts the large scale buying? There is no centralised office. Is there inside information on govt regulation leaking to the whales? Which govt, US or China?
The type of front-running Roubini is talking about would need an incredible amount of coordination between the whales (so that one whale does not offset intended price increases of large scale purchases by large scale selling during the same period) that his argument is not overly convincing I have to say.


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## Duke of Marmalade

WolfeTone said:


> The only conclusion I can come to is, like Veldes, is that  "bitcoin remains a _remarkable _conceptual and technical achievement" - this is not the general economist description of something with no intrinsic value?
> It is clear, to me, that is the descriptive of something _of_ intrinsic value.
> What the price attributable to that is what appears to be contentious.


Let's explore that thought.
Pure Mathematics is full of theorems and theories which have absolutely no utility value.  Yet I concede that they do have an intrinsic value.  What's it worth?  Well most earn a decent living lecturing or writing books.  Napoleon was fond of rewarding mathematicians with titles and bursaries etc.,  possibly explaining the huge French influence on 19th century mathematics.
So yes we are haggling about the price.  I personally find the technology very ugly (mindless computer hashtag trial and errors) but that is not relevant; I don't like modern art or punk rock either.  If I was hooked on the technology though, I would have thought a few satoshis in a wallet would satisfy my craving.
Take Laslo Hanyecz.  He was (probably still is) a computer programmer and he sounds like the kinda guy who was presumably bowled over by the new technology in 2010.  Nonetheless he still parted with 10,000 bitcoin for two pizzas ($150,000,000 each in today's money).
It is really difficult for me to see how the admiration of its aesthetic beauty could justify a price tag of $600bn.  I also don't see what relevance at all the world stock of currencies has for setting this price.  I doubt whether Pierre-Simon Laplace argued with Napoleon about how his elegant math theories compared with the size of the French treasury.


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## WolfeTone

I admit on the technological side I'm not totally bowled over by bitcoin from an end user point of view. As mentioned, there were reasons why I didn't buy into bitcoin at $80, instead it was closer to $3k. 
I find some of the terminology goes over my head and the private keys element is a risk by itself, particularly for someone used to the convenience of third party banking. For a non-technically minded person like myself it is somewhat a leap of faith - cushioned somewhat by not putting large amounts of money into it. 
But in comparison, if someone laid out a white paper for a 400-tonne of steel to fly passengers safely over the Atlantic, having never previously occurred, I may be inclined to buy into the concept of it although not necessarily convinced of the technology. 
What assures me of the technology is witnessing and participating in its continued existence and, over time, experiencing the improvements made to that technology. Aircraft are now long established safe modes of transport with very low risk of crashing. Bitcoin, still in its infancy, does crash but yet the technology survives, the "mindless hashtags", being necessary to secure the network, reward miners and underpinning the concept of ownership, or proof of work. 
If there was a fundamental flaw in the security of this network my guess is it would have emerged by now. Its possible it may emerge at some future point. Confidence is built over time and reliability. The longer the reliability over time the greater the confidence. 
If technological solutions emerge to deal with the somewhat clunky awkward engagement with bitcoin then it will keep making in-roads in becoming mainstream. 



Duke of Marmalade said:


> Take Laslo Hanyecz



In his own words, being involved at the very beginning of bitcoin, he stated that if no-one is using BTC then it is not working.
That makes sense, he understood it for what it was intended but if it wasn't circulating then what was the point of it? 
Take FB as an example. MZ (notwithstanding the subsequent legal wrangle of ownership) gave away considerable stakes of FB for what now  looks like, well, pizza-valued amounts of seed capital, compared to what FB is now valued. 
MZ understood if people were not using FB then it was effectively worthless. 

It's not clear if Hanycez dispensed of his entire store of bitcoin for the pizza either? The chat exchange below suggests he did not. 
My understanding is that the pizza purchase was not a consequence of being caught short of cash and having a dose of the munchies after a hefty session down the local. 
Instead the pizza order was made from the UK to a pizza establishment in US and the bitcoin was transferred to the person ordering in the UK. I may be incorrect in that. 
It was a trial experiment. Could someone send large amounts of bitcoin over the network securely to a recipient in return for goods or services? It worked. 

Bitcoin pizza order

I'm more intrigued with who ordered the pizza and what they did with the 10,000 BTC they received. I can only assume they too had a grasp of the bitcoin concept, otherwise why bother? 
But if I had received 10,000 BTC for roughly $50 ($0.005c per coin) what would I do with the BTC when it reached $1? I would surely be tempted to offload some of BTC to fiat cash? 
Ditto when it reached $2, $5, $10, $100, $1,000 etc. And what would other recipients do with BTC as its price increased? 
Meaning, has the entire $500bn network of bitcoin been nudged into being from out of the sale of two pizzas? 

Of course, this prompts the ponzi 'greater-fool' theory. And at some point people will get burnt/have got burnt. But what is the difference in this and people buying into overvalued stock, of which there are many at high values producing little, if any, profit? 
Someone will get burnt. 

The question arises, what do you get exchanging cash for BTC? 

This is where I buy into the conceptual side of bitcoin. This is also somewhat a leap of faith, but less and less so in an increasingly, more and more so, digitalised world. 

This is where we may part our ways as I digress into my "worldly view". But rather than focus on my oft stated position of fundamental flaws inherent in central Bank monetary policy, I will try add another layer to concepts that _may_ indirectly support the case for bitcoin. 

The World Wide Web and the advances of information technology over the Internet is ripping up the rule book on practically every aspect of our lives and in every sector of commerce and science. These advancements are not slowing down anytime soon but appear to be increasing at greater rates. 
I revert to well known TV physicist Michio Kaku, and a talk to science students in 2007. The talk is engaging, in simplified form, and somewhat enlightening, to me anyway, as to ways will be living our lives in the future. A 'Tomorrows World' talk if you like. 

The future in 2030.

The talk is an hour long and there is no mention of bitcoin. 
If you are not inclined to sit the the hour, the talk starts at around 5mins, in earnest by 10mins, and by 30-40mins you will have the jist of what he bringing to his audience. 

The critical points for me is that in all the technological advances he mentions that a fundamental reason is to reach out to people, to communicate with people, providing greater levels of information and service. 

Stepping outside the price speculation of bitcoin for a moment (and I will post a view on speculation later) - bitcoin is a form of communication. A form of communicating value, or perceived value. It is basic form of communication of supply and demand directly between users transmitting value in digital form. 
In the near future, I won't need the CSO via RTÉ to tell me what the inflation rate is. I will know exactly for myself at any given time via bitcoin. 
I will know with greater certainty if the new electric car, or if a kitchen fit out, or the price of pizza that I want to buy is providing me value. 
The monopoly of Central Bank issued fiat currency will be broken and _all_ individuals, by themselves and directly so, will determine what is the true value, or what they themselves perceive the true value, of any given good or service to be to themselves. 
My car tax was due today, €200. I could have cashed out some bitcoin to pay for it, but my expectation is that €200 fiat today will be worth considerably less in 12 months time relative to bitcoin. But that is my perception, my choice, and I now have that autonomy to decide that. 
So bitcoin offers autonomy to ALL individuals, with a smart phone and Internet connection. It is something that the banking and financial sector has come nowhere close to achieving and is unlikely to ever achieve. 
From a conceptual point of view this is what gives bitcoin its value. The price attributable to that value is determined by old-fashioned market supply and demand.


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## Duke of Marmalade

Lots to digest there _theo_.  It is becoming a bit of a dialogue, nonetheless if I find something new to add after perusing your post I will do so.


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## WolfeTone

Duke of Marmalade said:


> Lots to digest there _theo_. It is becoming a bit of a dialogue,



NY dinner, darts, and the wine....


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## DK123

Hi.Any chance of a summery,a conclusion and a plan of action here for the ordinary person who might take a small gamble,[K.i.s.s.].Thanks.


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## WolfeTone

Duke of Marmalade said:


> Annual sales run at about €7bn. If someone came looking to spend €16bn, prices would go through the roof (see what I dun there?)



Yes, I understand that, but it doesn't account for price manipulation levels of $18 to $350bn? Certainly it may account for _some_ manipulation, but in the round I would estimate its impact at a low level relative to the overall price level.



Duke of Marmalade said:


> What has changed? A vaccine?



A couple of things. As @DazedInPontoon mentioned, institutional investors have begun entering the market with significant levels of investment.

Also, there was the halving of the block reward in March this year. This is part of the technical side that I trust more than understand.
As much as I do understand it, it is that as the block reward has halved that the nodes/miners require more processing power to validate the blocks and earn the rewards. Or in short, it hardens the network against hacking, fraud, centralised control, etc.
In turn, it is now more attractive as a store of money than it was in 2016 (the last halving) and in 2012.
This may be the inducement of the very institutional investors that we are now seeing entering the market. Once the bull run ends, it may, lead to less volatility in the overall price.
Less volatility in the price may begin moving it towards its intended purpose as a medium of exchange.

As a side, and without wanting to go over the whole "features of money" I did hear two features/characteristics of what defines money that I think may have been absent in the discussions here and elsewhere - apologies in advance, if that is not the case.

First is that money needs to be collectable, only then does the scarcity feature emerge. Secondly, time & sequence - so what is not money today, may be money and a medium of exchange in the future.
The example given was primitive societies and the use of shells to trade. It wasn't the actual shells per se that was money, it was the shells in decorative and ornamental form that was money. Even still, shells made into bracelets, necklaces, ornaments etc were not made with the intention of being used as money, but rather for aesthetic purposes. Only when in say, times of hardship, did the ornamental items become of value to trade with other communities (perhaps experiencing a time of affluence) did the shells become money.
As a consequence, the ornament makers had, unintentionally, built up a store of value to be used eventually as a medium of exchange at the appropriate time.


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## Duke of Marmalade

WolfeTone said:


> Also, there was the halving of the block reward in March this year. This is part of the technical side that I trust more than understand.
> As much as I do understand it, it is that as the block reward has halved that the nodes/miners require more processing power to validate the blocks and earn the rewards. Or in short, it hardens the network against hacking, fraud, centralised control, etc.


I was asking why btc has increased 50% in the last two months.  Only two news stories worth a mention.  A  good guy will be next POTUS and the discovery of a vaccine.  Really can't see why that adds $200bn to btc mkt cap.  On the doubling my understanding was that that was not the @tecate  argument.  That argument was that as the supply of *new* bitcoins halved its price would go up on supply and demand arguments.  Completely bogus of course, as the supply of new coins is a very minor part of the supply/demand dynamic.  On the other hand if you think the supply of new coins is a significant price driver then that would underpin that an extra $16bn of demand would have a highly leveraged effect on the price.




> The example given was primitive societies and the use of shells to trade. It wasn't the actual shells per se that was money, it was the shells in decorative and ornamental form that was money. Even still, shells made into bracelets, necklaces, ornaments etc were not made with the intention of being used as money, but rather for aesthetic purposes. Only when in say, times of hardship, did the ornamental items become of value to trade with other communities (perhaps experiencing a time of affluence) did the shells become money.
> As a consequence, the ornament makers had, unintentionally, built up a store of value to be used eventually as a medium of exchange at the appropriate time.


I agree with this and it is completely contrary to orthodox bitcoin theology.  The cultists do from time to time cite shells as an example of money with no intrinsic value.  You have just explained that the reason it served as money in primitive times was precisely because it had intrinsic value, at least when made into an ornament.


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## WolfeTone

Duke of Marmalade said:


> Only two news stories worth a mention.



I would attribute more to the recent news stories of ECB and Federal Reserve additional stimuli as being of more significance, but that is just a matter of opinion.



Duke of Marmalade said:


> as the supply of new coins is a very minor part of the supply/demand dynamic.



Indeed, but it is the other element of the halving that is most significant. The "mindless hashtags" as you call them, just got crazier. In doing so, it hardens the network.
In theory it is possible to alter the 21m bitcoin supply. In practice, it may take a co-ordinated supercomputer effort to do so, or at least that is my understanding.
So bitcoin, a hard digital monetary network , becomes more attractive place to store money than say, fiat, a softer digital monetary network.



Duke of Marmalade said:


> precisely because it had intrinsic value, at least when made into an ornament.



You are not applying the concept of time and sequence here.
At a very base level, shell intrinsic value is its function to marine biology - not much use in monetary terms, but there you go.
It's use in the form of an ornament or decoration offers aesthetic value, in that form is its intrinsic value. In monetary terms it is still zero.
Only when the shell, in its ornamental form is used as a medium of exchange in trade is its monetary intrinsic value realised (price).
And as we are a species more sophisticated than say, goldfish, we can apply or establish that similar shell based ornaments can hold intrinsic monetary value to greater or lesser extents depending on demand and supply and forming markets.

Another example would be my 8yr old Christmas card drawn at school. Its only intrinsic value is the emotional gushing from mum and dad. Until that is, 20 copies are made, a price tag of €1 applied to each copy, and proceeds being sent to St Vín de Paul. In an instant, the emotional intrinsic value also has a monetary intrinsic value extracted from mum and dad to the charity. And this monetary value will sustain until, well, until it doesn't.

Bitcoin’s intrinsic value is the ability to store money outside the soft digital fiat form in a hard digital form. The price attributable to that value is determined by market supply and demand.


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## Duke of Marmalade

@WolfeTone These are predictions from folk who know a lot more than you or I


			
				“Wolfie Tone said:
			
		

> As much as I do understand it, it is that as the block reward has halved that the nodes/miners require more processing power to validate the blocks and earn the rewards. Or in short, it hardens the network against hacking, fraud, centralised control,


I think you should refresh your understanding.  The processing power is driven by the incentive to mine new coins.  Halving the incentive could in no way of itself attract more processing power.


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## WolfeTone

Duke of Marmalade said:


> @WolfeTone These are predictions from folk who know a lot more than you or I



Duke, you do yourself a disservice. I'm of the view that you could indeed know more than I or most people. I'm open to the view that BTC could return to zero, that it is a wholly manipulated market, that it is unsustainable etc, etc.
All I can work off is the information put in front of me and make as much sense of it as possible and then make as much an informed decision based on that information. You have kindly provided me with an article of bitcoin sceptics that, on the face of it, if this was the only information available to me I would have sold out my stock of bitcoin before the end of this sentence. But it is not the only information I have. Nevertheless, it would foolish of me to totally discount the sceptic views without at least a minimum of consideration.

Forgive me for being a little bit skeptical of an article that is clearly loaded to push the skeptic view. Nevertheless;

-* Nicholas Weaver*. A researcher at (in?) computer science, Berkley. Nicholas following BTC since 2011! Has declared that "this is the year the music stops". A full on believer that bitcoin is a ponzi scheme, he believes that it is Tether that is sucking the last of the dollars and the end is nigh!
Forgive me for being skeptical of the ponzi scheme view considering it all began with the purchase of two pizzas for 10,000 BTC _and _having crashed several times over the last decade, Weaver, and everyone else, is short on explaining how BTC is the first ponzi scheme that has prevailed despite numerous price crashes and predictions of returning to zero. Maybe its a ponzi "_this time is different_" scheme?

- *Jorge Stolfi.* I like Jorgi from the get-go. "_he knows too well that anything can happen_". Which kind of disputes Weavers view above? Either the music _is_ going to stop this year, or _anything_ can happen...which one of these people who know a lot more than me is correct? If Weaver is correct then Stolfi is wrong to suggest anything can happen, if Stolfi is correct then Weaver is wrong to suggest that this is the year the music will stop.

- *Frances Coppola. *Frances is angry. And she ought to be, she has had to endure the bitcoin trolls on social media for daring to suggest that bitcoin is not scarce. She hopes it crashes and burns, she just doesn't know when, but her anger appears to prompt her to think it will be around, eh, June.

- *David Gerard *Well, he wrote a book about FB Libra coin (whatever happened to that?). David is pretty sure bitcoiners are about to get a dose of real-world regulatory compliance. Bring it on David!, BRING IT ON!! 
Although he then goes on to admit "...these guys are just amazing in their ability to dodge the blade....", which kind of dilutes his overall message of the power of regulatory authority.

- *Nouriel Roubini *I do agree with Nouriel on one thing. The CB digital money will not be cryptocurrency as we understand it today. He is explicit in his online interview. CB digital money will be centralised, permissioned and private - the exact opposite of bitcoin. Roubini claims it will destroy the crypto market. It may take out a lot of the s1coins but I cannot see it destroying crypto. More so, with individuals now having personalised digital accounts with central banks, the need for retail commercial banks and other payment processors becomes questionable. This is touched on here in this AAM thread

Will the banks survive the current changed economic climate


- *The author (I cannot find her name) *Her heart is in the right place for sure. She wants to protect the retail investors who are being duped. But I do find her position somewhat contradictory. She advises the reader, me, to sell my holding or get at least my initial investment back. But in order to sell, there needs to be a buyer - what is her advice for prospective buyers of my bitcoin?

All in all, it is useful to get the skeptical view of bitcoin. It assists in overindulging the bitcoin euphoria which I believe is just the polar end of the views expressed in the article.
Im of the view that the truth lies somewhere in-between. Meaning, my BTC holding is valuable, but not life-changing. But I would still be very much inclined to think that the BTC story has a long, long way to go.


----------



## Duke of Marmalade

@WolfeTone It was refreshing for me to read the skeptics.  My conviction that crypto is 100% irrational is confirmed.  And yet!?  I shorted btc in early 2018 at 14,000 and got out a few weeks later at 8,000 for a not life changing profit.  I haven't dabbled since and I am not tempted now for the reasons reflected in the quotes supplied by Brendan in #33.  It seems it will need a major denouement like the exposure of Tether to stop this irrationality any time soon.


----------



## tecate

Duke of Marmalade said:


> @WolfeTone It was refreshing for me to read the skeptics.  My conviction that crypto is 100% irrational is confirmed.


 Tonight's homework.



Duke of Marmalade said:


> I shorted btc in early 2018 at 14,000 and got out a few weeks later at 8,000 for a not life changing profit. I haven't dabbled since and I am not tempted now for the reasons reflected in the quotes supplied by Brendan in #33.


Hat's off to you Dukey. I have no doubt whatsoever but that you are risk averse and fiscally conservative. I mean, the strength of your conviction couldn't even extend to the price of a couple of pints.


----------



## WolfeTone

Duke of Marmalade said:


> Are there any respected economists making the case for bitcoin?



Apologies, I didnt realise earlier that I was responding in the bitcoin pension thread.

Veldes/Ammos v Roubini/Krugman

All respected economists in their own right. Roubini and Krugman obviously carry higher stature in their respective fields but specifically when it comes to bitcoin, Veldes and Ammos offer much greater insight. In particular Dr Ammos.


----------



## Duke of Marmalade

@WolfeTone
I tracked that Ammous fellow down.  This is what Quickpenguin says about his book "The Bitcoin Standard".


			
				Quickpengiuin said:
			
		

> Unfortunately, there are some notable bad points.
> 
> Saifedean Ammous is an academic, which shows itself in his writing. He could have easily cut 50 pages from this book with some moderate editing (especially in the middle of the book).
> Saifedean Ammous has an obvious dislike for Keynes and Keynesian economics. The venom spills from the page, which really distracts from the argument he was attempting to make. It just wasn’t needed.
> At one point, Saifedean Ammous rants about how art has been tainted by Keynesian policies, which encourage high time preference (i.e. short-terminism). It’s an absolutely absurd section and something that should have never made the final cut.
> Saifedean Ammous argues that Bitcoin (BTC) could be an international settlement currency in the future. It’s an interesting idea, but I would have liked to have seen a fleshed-out exploration of this possible future.



I particularly draw attention to the last point.  The idea that EU contributions to the budget or US arms sales to Saudi Arabia could be paid in bitcoin is for the birds.  So no, I am not impressed by the witnesses for the defence.


----------



## WolfeTone

Duke of Marmalade said:


> I particularly draw attention to the last point. The idea that EU contributions to the budget or US arms sales to Saudi Arabia could be paid in bitcoin is for the birds. So yes I am unimpressed by the witnesses for the defence.



_Hold your horses there Duke! _

The question was, "are there are respected economists making the case for bitcoin?".

I have produced two economists who, to all intents and purposes are respected in their  field of work, and who make the case, or a case, for bitcoin.
I can add Alexander Puutio, lawyer and economist, to that list also.

The question you asked has been answered. It is Yes.

As I feared, the goalposts have shifted somewhat from economists making the case for bitcoin to, "quick penguin" book reviews! And only the bad parts of the review to boot!

I had a look at the entire book "review".

_"Despite my disappointment, I did enjoy (and benefit from) reading The Bitcoin Standard... And if you do decide to pick it up, then give yourself permission to skim chapters 4 through 7". _


----------



## Duke of Marmalade

@WolfeTone You have done what was asked, fair play.
But!  And I am not trying to score cheap points here. 
You have managed to persuade me even more that there is no substantial school of economic thought which supports bitcoin.  There are those who are impressed by the technology, there are those who are prepared to ignore its fatal flaw - it has no intrinsic/fundamental/utility value.  But the vehemence with which the likes of Professor Roubini denounce it as 100% irrational (not to mention a raft of Nobels) remains totally persuasive.


----------



## tecate

@dukey: You forgot to include the citation for your  'book review'. I've fished it out for you as I wouldn't want you getting into trouble.

'DEAN' from Quickpenguin and his book review​
I guess we'll leave it at that, shall we?
​


----------



## WolfeTone

Duke of Marmalade said:


> that there is no substantial school of economic thought which supports bitcoin.



_(_ _shall we will pretend the quickpenguin book 'review' never happened?_ )

You have moved the goalposts and now ask for a "_substantial school of economic thought" _which supports bitcoin.

You don't ask for much do you?

Anyway, see how we go...

I would suggest that there is no school of economic thought that _does not _support bitcoin. 
In fact, I would argue that the entire sphere of mainstream economic thought is wholly behind bitcoin. More precisely, the technology that it is built on.

The only contention is the value of the _concepts _associated with bitcoin and the price attributable to that value.

In simple terms, economists study human behaviour toward desirable goods and services that are scarce (or in these times of abundance, that have limited availability).
This induces a concept of value, which as humans we communicate to each other through a monetary system, namely price.

Critically, all schools of economic theory originate from the study of past human behaviour and experience relative to scarce goods and services, with the intent to anticipate and predict future human behaviour and potential consequences thereafter.

So I want to put to all the economists, and all the economic schools, and all the Nobel medal winners, and all their proponents, a very simple question of economics based on past historical recorded behaviour and experience.

Q: In 2009, two Papa John's Pizza were traded for 10,000 BTC, who received the greater value in monetary terms? The pizza recipient or the BTC recipient?
And which economic school of thought substantially supports your view?


----------



## Duke of Marmalade

Sorry _theo_, I don't know where you are going with that.  I think of Keynesianism vs Monetarism.  Heavy debate in the economic profession. If bitcoin had any validity I would expect a similar style debate as to whether this was the future of money.


----------



## WolfeTone

@Duke of Marmalade Bitcoin is technology. First and foremost that is what it is.
What value, in monetary terms, is derived from bitcoin and the price attributable to that value is the economic side. Keynesian, Monetarism, Austrian, Classical, Marxism etc are all abstract political concepts of how economies, the resources within, should be run to greatest efficiency. They provide the theoretical basis why their way is the best way. Those agreeing certain generalities on a broad basis form a 'school of economic thought'.

Economists are not technologists, they are not physicists, biologists, carpenters, civil engineers, administrators, computer programmers, hairdressers, chefs etc, etc.
A chef is better placed to know if a new recipe, or a certain restaurant ambience will likely serve as additional value to a business than an economist.
A hairdresser is better placed to know if a new hairstyle or coloring product will likely serve as additional value to a business than an economist.
An administrator is better placed to know if a new process or procedure will likely serve as additional value to a business than an economist.
Etc, etc.

All an economist will tell you is, that if a new product, good or service, does provides utility and is more resource efficient than the old product, good or service then, in theory, it will add value. That value typically reflected in monetary terms.
But we all already know that. We do not need an economic school of thought to come to that conclusion.

So the argument is not that bitcoin is not technology, it is, but rather what utility it provides and the value of that utility. And then how the value of that utility is reflected in a monetary price. This is where the argument rages. 
Roubini proclaims it has no utility, that is his entitlement. I disagree. But I will try not to open another round of what is already said and instead try to communicate what I think is a (very distant) threat to bitcoin - interest rates.

I consider bitcoin to be a hard form of money and fiat to be a softer form of money. The lower the interest rate, the softer the fiat currency. If interest rates rise, it signifies a reduction in supply of currency. Money then becomes more expensive to borrow, and the holder can extract a rental payment in savings. The higher the interest rate, the harder the currency. The big problem however with monetary policy as I see it, is that other than the knights of the high central bank table, no-one, gets to decide how this currency is managed. 
The monetary policy of some 400million (?) people in the EU is ultimately dictated by handful of decision-makers! 
Now if we assume that their decisions are construed from a rigid set of policy dictats, and that those policies are not easily convertible into new rules and policies, then that adds strength to the value of the currency they manage. But that is not the case, not at all. Policies are changed, bailouts are granted, stimuli injected, pension funds raided, savings confiscated, currency printed, interest rates reduced, etc - all done in the name of preserving the value of the currency. It remains to be seen how successful the policy management will be. I have little confidence. 

In my economic school of thought, interest rates are an economic force. They are not something to be unilaterally decided upon by small cabals of bankers. But that is our monetary system, we have artificially set interest rates by central banks, and we have _real_ interest rates set by the economy in the round. By businesses and individuals engaging in trade, price discovery, supply, demand etc - this os what forms the _real _interest rate.

So bitcoin provides utility, to me, by providing a space to transfer soft digital fiat form money, into hard digital crypto form money. It is verifiable, the network is hard, the rules even harder to change, etc. I have bought it, sold it, transferred it, even invested some and received a return in btc.
So that is its utility to date, for me, not Roubini. 
Roubini needs to be called out when he says it has no utility and no use case. This is factually incorrect.

The price attributable to avail of one full unit of that hard verifiable digital space is around $34,000. It is my belief, that the greater utility use of this space then the closer it will become to being a widespread mainstream medium of exchange, but I think that is a long way off yet.


----------



## Duke of Marmalade

WolfeTone said:


> @Duke of Marmalade Bitcoin is technology. First and foremost that is what it is.
> What value, in monetary terms, is derived from bitcoin and the price attributable to that value is the economic side. Keynesian, Monetarism, Austrian, Classical, Marxism etc are all abstract political concepts of how economies, the resources within, should be run to greatest efficiency. They provide the theoretical basis why their way is the best way. Those agreeing certain generalities on a broad basis form a 'school of economic thought'.
> 
> Economists are not technologists, they are not physicists, biologists, carpenters, civil engineers, administrators, computer programmers, hairdressers, chefs etc, etc.
> A chef is better placed to know if a new recipe, or a certain restaurant ambience will likely serve as additional value to a business than an economist.
> A hairdresser is better placed to know if a new hairstyle or coloring product will likely serve as additional value to a business than an economist.
> An administrator is better placed to know if a new process or procedure will likely serve as additional value to a business than an economist.
> Etc, etc.


 Not sure what to make of that but I take it that it seems to imply that a Professor of Economics has no more authority to comment on bitcoin than, say, a carpenter.  Let's agree to disagree on that one.


> Roubini proclaims it has no utility, that is his entitlement. I disagree.


 I agree with the professor, so let's again agree to disagree.


> I consider bitcoin to be a hard form of money and fiat to be a softer form of money.


 I agree with the professor that bitcoin is not a currency.  Let's agree to disagree. 





> The lower the interest rate, the softer the fiat currency. If interest rates rise, it signifies a reduction in supply of currency. Money then becomes more expensive to borrow, and the holder can extract a rental payment in savings. The higher the interest rate, the harder the currency.


I'm a bit rusty on monetary dynamics.  The Russian rouble has a current interest rate in excess of 6%,  the euro interest rate is negative.  I'll take your word for it that the rouble is a harder currency than the euro.   





> The big problem however with monetary policy as I see it, is that other than the knights of the high central bank table, no-one, gets to decide how this currency is managed.


 Money is the life blood of our economy.  I have no problem leaving its management to experts subject of course to general guidelines.  Just as I would have no problem leaving public health policy to the experts.


> But that is not the case, not at all. Policies are changed, bailouts are granted, stimuli injected, pension funds raided, savings confiscated, currency printed, interest rates reduced, etc - all done in the name of preserving the value of the currency.


Yes we live in a very complex society.  The UK/EU FTA runs to 1,300 pages.  The idea that our economy would run more efficiently if we just had a fixed money supply and no monetary management is nigh eve in the extreme. 





> It remains to be seen how successful the policy management will be. I have little confidence.


 I have my doubts also but do not see any insurance in the wildly speculative crypto space.



> So bitcoin provides utility


Let's agree to disagree.


> Roubini needs to be called out when he says it has no utility and no use case. This is factually incorrect.


  John Kelleher, an ardent bitcoin supporter, states that the only utility that bitcoin can possibly acquire is as a medium of exchange.  I think you have conceded that bitcoin has made no progress in this respect, as in this quote:



> ...the closer it will become to being a widespread mainstream medium of exchange, but I think that is a long way off yet.


----------



## WolfeTone

My $34,500 bitcoin valuation for 31/12/22 has already arrived. I may have to review my calculation method.


----------



## WolfeTone

Duke of Marmalade said:


> I take it that it seems to imply that a Professor of Economics has no more authority to comment on bitcoin than, say, a carpenter.



It says, that a Professor of Economics is no more qualified to identify what increases value in a hairdressing salon than a professional hairdresser is. 
Meaning, an economist is no more qualified to comment on bitcoin as a technology than say, a computer programmer, a financier, a physicist, a hedge fund manager, etc

It is your apparent devotion to the economic profession (but only those economists that agree your view) when it comes to bitcoin that I find a peculiarity. 
I don't discount their insights, but limiting your understanding of bitcoin to economists who appear not to have an understanding, or have been repeatedly wrong in their predictions of bitcoin, is self-defeating, imo.


----------



## Duke of Marmalade

@WolfeTone First of all congrats on achieving $34.5k, and I mean that.  Someone from Mars reading our postings over the last while and seeing the bitcoin trajectory would mark it as a 10-0 win for yourself.
I am not actually a big fan of the dismal science,  their predictions make astrologists look  respectable.  It's just that bitcoin cultists seemed to be a mixture of nerds fascinated by the crypto puzzles and BigShort worldview folk who saw this as the demise of capitalism.  The dog that wasn't barking were the mainstream economists.  If mainstream economists were hailing it as a major breakthrough for humanity I would take notice.


----------



## WolfeTone

Milken Institute panel discussion from 2018.

Two crypto entrepreneurs, a US government official, and Roubini. Well worth a watch.

Cryptocurrencies: Irrational Exuberance or Brave New World

The strange take from it is that I actually understand Roubini's talk more than the entrepreneurs. A lot of what the entrepreneurs are saying goes over my head, albeit I broadly understand the concepts they are highlighting (I think!).
I cannot but conclude that the entrepreneurs are speaking of concepts that Roubini is not grasping at all. The confidence and vision of future internet technologies from people who are very experienced in the field is clearly evident.

Another take is the US Treasury Dept guy. He chimes very much with my view that it is unlikely that there will be moves by US government to crush bitcoin. Not in a democratic free-market society there will not be. They are completely open to learning and understanding bitcoin and for allowing innovation to flourish - it is afterall, the United States of America, not North Korea.

CryptoCrime, terrorism, illicit money laundering, failed ICO's, failed businesses, are all addressed here.

@Duke of Marmalade it is the guys with the insights into the technologies that I lean to in this field and not economists.


----------



## Brendan Burgess

WolfeTone said:


> A lot of what the entrepreneurs are saying goes over my head,





WolfeTone said:


> the entrepreneurs are speaking of concepts that Roubini is not grasping at all.



That is hilarious. 

It strongly suggests that there is nothing at all in what the entrepreneurs are saying.

Brendan


----------



## WolfeTone

Brendan Burgess said:


> That is hilarious.
> 
> It strongly suggests that there is nothing at all in what the entrepreneurs are saying.



I was speaking to my 13yr old about what was happening in Washington. He couldn't understand why people were blaming Trump because he was still the President. 
I was talking about democratic mandates, rule of law, separation of powers etc. Most of it went over his head but I sensed he grasped there was more to what I was saying. He just doesn't get it yet. 

Roubini is talking in a language that sounds dated, eg. 'glorified excel spreadsheets' to describe blockchain. 
The technologists and entrepreneurs that are creating, innovating and investing are clearly intelligent people. They may speak a language that I cannot fully grasp but it is clear they certainly understand one another.
And they are innovating and investing their time and resources in an area where bitcoin is central to everything they are doing. 

If an economist equates, communication+intelligence +experience +innovation = BOHA, then I for one, would tend not to give much time for his views. But each to their own I suppose.


----------



## SGWidow

Oh, the poor kid!


----------



## WolfeTone

SGWidow said:


> Oh, the poor kid!



When his inquisitive look went to a blank stare, I knew it was time to give up!


----------



## WolfeTone

Duke of Marmalade said:


> BigShort worldview folk who saw this as the demise of capitalism



Bitcoin is a saviour of capitalism. Centralised command banking economies operating fiat money systems are the demise of capitalism.


----------



## tecate

Brendan Burgess said:


> It strongly suggests that there is nothing at all in what the entrepreneurs are saying.


Suggesting that Roubini has no notion? If you had watched it then you would know he doesn't have a full understanding. That's why he was told during the course of the debate, maybe you should go buy some bitcoin and find out how it actually works.

It's a common problem. He decided early on that there was no value in bitcoin without ever gaining a full understanding. He's been doubling down on that position ever since - from as far back as when bitcoin was at $13!! I've listened to similar panel discussions involving Krugman and it's exactly the same.

I had watched that original debate in 2018 but decided to watch it again - just to see how accurate either party was. When Mashinsky claimed that institutional investment was coming, Roubini said it would never come (wrong!). When asked if he saw anything positive in the technology, he spewed out the 'blockchain not bitcoin' nonsense that the banking set were running with at the time. Practically everybody else has given up with that nonsense - but in 2021, he persists with it. He has declared bitcoin dead following a number of peaks and troughs over the years - and clearly he's been wrong in those assessments each time.


----------



## SGWidow

tecate said:


> That's why he was told during the course of the debate, maybe you should go buy some bitcoin and find out how it actually works.



That's such an interesting observation. Reminds me of...…..the Catholic priest of old dishing out direction on appropriate behaviour in a particular room of the house.



tecate said:


> It's a common problem. He decided early on that there was no value in bitcoin without ever gaining a full understanding. He's been doubling down on that position ever since - from as far back as when bitcoin was at $13!!



A common problem indeed. Reminds me of...……_it ain't what you don't know that gets you into trouble - it's what you know for sure that just ain't so._


----------



## Duke of Marmalade

WolfeTone said:


> It says, that a Professor of Economics is no more qualified to identify what increases value in a hairdressing salon than a professional hairdresser is.
> Meaning, an economist is no more qualified to comment on bitcoin as a technology than say, a computer programmer, a financier, a physicist, a hedge fund manager, etc


_theo T_o me technology is a means not an end.  Take television, now there is a marvelous technology.  The entertainment, news, sports etc. industries exploit it to great effect. and of course billions of people own TV sets.  I suppose once in a while someone watching a live tennis match in Australia might for a brief moment ask herself "how can this be?", but quickly gets over the moment and sits back to enjoy the game.
Your depiction of bitcoin seems to turn this on its head.  It is the technological marvel of a distributed ledger that is the overriding attraction to the bitcoin owner.  (Aside: IMHO a technology not quite on a par with television but that is a subjective call).
The bitcoin owner's occasional pause for thought is "but what do I use it for?".  She might consult the White Paper and see that it was intended as a medium of exchange.  She might think "but I don't actually need it for that" but she gets over her moment of doubt and goes back to wondrous contemplation of a computer doing billions of SHA trials and errors.
Economists are not especially qualified to comment on the nuts and bolts of blockchain technology but they are qualified to comment on whether it can achieve its purpose of being a medium of exchange.


----------



## tecate

WolfeTone said:


> Economists are not especially qualified to comment on the nuts and bolts of blockchain technology but they are qualified to comment on whether it can achieve its purpose of being a medium of exchange.


How can they be authoritative on the subject when they simply don't understand the technology and how it works. I've often given you Krugman's fax machine example. He should have stayed in his own lane. Roubini should do the same - or otherwise, be open to understanding the proposition at hand.


----------



## Brendan Burgess

Duke of Marmalade said:


> I suppose once in a while someone watching a live tennis match in Australia might for a brief moment ask herself "how can this be?"





Duke of Marmalade said:


> It is the technological marvel of a distributed ledger that is the overriding attraction to the bitcoin owner. ...
> 
> The bitcoin owner's occasional pause for thought is "but what do I use it for?"



Duke - that is a really brilliant comparison.


----------



## tecate

Brendan Burgess said:


> Duke - that is a really brilliant comparison.


I agree that many technologists have created 'solutions' or standalone tech that doesn't have a real world use. That's not the case when it comes to bitcoin. It's found its identity as digital gold. There may be other use cases it makes inroads in - as we progress.


----------



## Duke of Marmalade

tecate said:


> How can they be authoritative on the subject when they simply don't understand the technology and how it works. I've often given you Krugman's fax machine example. He should have stayed in his own lane. Roubini should do the same - or otherwise, be open to understanding the proposition at hand.


I wasn't aware that @WolfeTone was making the same point as I.  I will answer for us both.  Krugman misjudged the business potential of internet.  That has nothing to do with his understanding of the technology.  But you know that but had to play your Krugman iron for the umpteenth time.  Have you no other clubs?


----------



## tecate

Duke of Marmalade said:


> Krugman misjudged the business potential of internet.  That has nothing to do with his understanding of the technology.  But you know that but had to play your Krugman iron for the umpteenth time.  Have you no other clubs?


1. He misjudged it because it's outside of his area of expertise.
2. It's incredibly important - to this most recent point that you're trying to make and to the overall discussion. It's not just Krugman and Roubini that have misunderstood the bitcoin proposition. We have plenty of examples much, much closer to home.

Added to that, yesterday you said bitcoin would only be of interest to you if the right type of economist gave it the thumbs up. How about forming your own opinion? You also said recently that you were concerned about monetary expansion but said you'd have to trust these economists and central bankers. Blind trust makes no sense to me. They should be held to account and made explain how they get out of this money printing vortex.


----------



## Duke of Marmalade

tecate said:


> Added to that, yesterday you said bitcoin would only be of interest to you if the right type of economist gave it the thumbs up.


That's not my position.  If the viability of bitcoin was a raging debate in academic economist circles,  I would be on the side of those arguing against it.  It is the fact that it is dismissed almost universally by the economics profession which strikes me as very telling.

You seem to take comfort that because one of their Nobels made a spectacular boo-boo over 20 years ago that you can dismiss the whole profession.
In passing, what do you think of Warren Buffet's assessment of bitcoin as "rat poison squared" or have you a similar club for banging him into the long grass?


----------



## tecate

Duke of Marmalade said:


> That's not my position.  If the viability of bitcoin was a raging debate in academic economist circles,  I would be on the side of those arguing against it.  It is the fact that it is dismissed almost universally by the economics profession which strikes me as very telling.


Ok, so you are using Keynesian economists (bearing in mind this economic approach is diametrically opposed to the notion of bitcoin) as a crutch to validate your politically motivated take on bitcoin? Even the political motivation is wayward. You said yesterday that the original proponents of bitcoin want to put an end to capitalism. Yourself and Brendan made references previously to socialist views in this context. There are many people involved with bitcoin - but amongst them there are a large swathe of right-wingers who are far more capitalist than you or I.



Duke of Marmalade said:


> If the viability of bitcoin was a raging debate in academic economist circles,  I would be on the side of those arguing against it.  It is the fact that it is dismissed almost universally by the economics profession which strikes me as very telling


It's not dismissed universally.  There are many economists and the like who oppose your view. Wolfie already provided you with a couple of examples - but according to you they're not the right type of economists. You'll then roll out a book review of some randomer in a desperate attempt to blacken a respected economist....therefore, there's little point in providing you with more examples.



Duke of Marmalade said:


> You seem to take comfort that because one of their Nobels made a spectacular boo-boo over 20 years ago that you can dismiss the whole profession.


I think that only a fool would ignore that instance. As per my previous post, it's very much prescient. If anyone took his word as gospel back then, then they missed out on one of the greatest waves of innovation we've ever seen.



Duke of Marmalade said:


> In passing, what do you think of Warren Buffet's assessment of bitcoin as "rat poison squared" or have you a similar club for banging him into the long grass?


We've discussed it before but if you need a refresher, no problem. I said back then that Buffett has to be respected according to his moniker (the oracle of omaha). However, it's precisely the same scenario as with Krugman and Roubini. He is on record as saying that he got it completely wrong when it comes to the tech monoliths that arose out of the ashes of the dot.com boom/bust. He has said that he misunderstood the technology.
Buffett called bitcoin rat poison squared.  I agree with him insofar as it's rat poison for cash/sovereign money.


----------



## WolfeTone

Duke of Marmalade said:


> _T_o me technology is a means not an end. Take television, now there is a marvelous technology



I couldnt agree more.



Duke of Marmalade said:


> Economists are not especially qualified to comment on the nuts and bolts of blockchain technology but they are qualified to comment on whether it can achieve its purpose of being a medium of exchange.



True, which is why when I listen to people who do know the nuts and bolts of the technology they are investing in first. Then I can listen to economists, afterwards, when they can tell us why a particular technology failed, or succeeded, not when it is clearly going through a significant period of innovation. 

I can only imagine back in the 19th century that the concept of moving pictures transmitted across analog signals would have met with some heavy doses of skepticism? 
So having a quick read of the history of television I came across this on the wiki page

_"On March 25, 1925, Baird gave the first public demonstration of televised silhouette images in motion, at Selfridge's Department Store in London.[11] Since human faces had inadequate contrast to show up on his primitive system, he televised a talking, moving ventriloquist's dummy named "Stooky Bill", whose painted face had higher contrast. By January 26, 1926, he demonstrated the transmission of image of a face in motion by radio. This is widely regarded as being the world's first public television demonstration."_

It was certainly a long way from 52" HD surround-sound Smart flatscreen TV.
Outside those, like Baird, who were developing the technology, was there anyone who could have envisaged television to become the game-changer of communication that it became?

I don't know, maybe its just me, but 10,000 BTC for two pizza just popped into my mind.


----------



## Duke of Marmalade

tecate said:


> Wolfie already provided you with a couple of examples - but according to you they're not the right type of economists. You'll then roll out a book review of some randomer in a desperate attempt to blacken a respected economist....therefore, there's little point in providing you with more examples.


I am confused by this and previous posts.  Who is the randomer?  Is it Quickpenguin or Dr Ammous? _Wolfie _responded to my post by giving the more complete Quickpenguin review of his book The Bitcoin Standard, suggesting I was talking about the right Dr Ammous albeit _Wolfie _spelt it Ammos.


----------



## tecate

@dukey - that's it, keep trying to tar and feather with book reviews from guys called "Jeff", whoever "Jeff" is ...


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## WolfeTone

Duke of Marmalade said:


> I am confused by this and previous posts? Who is the randomer? Is it Quickpenguin or Dr Ammous? _Wolfie _responded to my post by giving the more complete Quickpenguin review of his book The Bitcoin Standard



I think you understand the point I was making was that the "review" was somewhat shallow, and very, very selective. 
Nevertheless, producing book reviews was only a diversion on your part. Perhaps Ammous ( _darn those mid-Eastern names always catch me, Solamani/Sulemani? Achmed/Achmad? Muhammed/Mohammad?_) style of writing didn't engage the reader. 

I have to admit myself, the bible of all economic thought "Wealth of Nations" is a bit of a brain-draining drooler at times. Surely the publisher could've seen the value of shaving off a couple of hundred pages? 
I give it 3.5 stars!


----------



## Duke of Marmalade

I am gobsmacked!  _Wolfie_ cites Dr Ammos.  I Google search and find a book review of The Bitcoin Standard.  I think to myself that is the guy even though it is spelt wrong.  I read the review and thought of the reviewer "another one duped by bitcoin".  But there was the bit about international settlements so yes I selectively chose to focus on that.
But to the true cultists, giving 3.5 stars to a bitcoin prophet is tantamount to blasphemy.  BTW I haven't a clue who Jeff is and why it is relevant.


----------



## WolfeTone

Duke of Marmalade said:


> I am gobsmacked! _Wolfie_ cites Dr Ammos. I Google search and find a book review of The Bitcoin Standard. I think to myself that is the guy even though it is spelt wrong. I read the review and thought of the reviewer "another one duped by bitcoin". But there was the bit about international settlements so yes I selectively chose to focus on that.
> But to the true cultists, giving 3.5 stars to a bitcoin prophet is tantamount to blasphemy. BTW I haven't a clue who Jeff is and why it is relevant.



Duke, your question was "are there any respected economists...", you have admitted that there are, being the aforementioned Dr Ammos/Ammous.

If you want to discuss the content of the book, then fine, but I suggest another thread. It may well be worth "3.5 Stars", maybe you would think it is a poor book, I just happen to think it was a poor review (see my review of _Wealth of Nations_).


----------



## Duke of Marmalade

WolfeTone said:


> If you want to discuss the content of the book


This is getting ridiculous.  You refer me to a Dr Amos and I see that he envisages a role for bitcoin in international settlements.  That to me puts him at zero in my estimation even below @tecate 's opinion of Krugman.


----------



## tecate

@dukey - Because you don't want that to happen, not because it cant happen or it isn't happening to some extent. Your political outlook blinds you on this subject.


----------



## WolfeTone

Duke of Marmalade said:


> You refer me to a Dr Amos and I see that he envisages a role for bitcoin in international settlements.  That to me puts him at zero in my estimation even below @tecate 's opinion of Krugman.



Ok so @tecate has the respected Krugman card to play, and now you have the respected Ammous card to play, from your standpoint. Where are going with all of this?



WolfeTone said:


> from a profession that can't even agree with itself alot of the time, it's a peculiarity to me why so much value is placed in their opinion on bitcoin


----------



## tecate

@Wolfie - He'll have to do better than a book review from "Jeff" if he wants to discredit Saifedean.


----------



## Duke of Marmalade

Wolfe Tone said:
			
		

> from a profession that can't even agree with itself a lot of the time


  Exactly and one would have thought that bitcoin would have been fertile ground for further disagreement.  It is the (near) universal agreement that impresses me.  But for avoidance of doubt my skepticism on crypto does not rely in any significant way on this observation.


----------



## tecate

@dukey - you don't have universal agreement. Secondly you're looking at a subset of economic theory that is opposed to hard money. Turkeys don't vote for Christmas.


----------



## WolfeTone

Duke of Marmalade said:


> It is the (near) universal agreement that impresses me



Ah, nice move Duke, in chess terms this I think is called "Check". Can I avert this threat. Let's see.

You make a claim of "(near) universal agreement".

For sure, I concede that you can produce a series of heavy-hitters, an almost Olympian dream-team if you like, Krugman, Stiglitz, Roubini,Thaler, and others,....it is quite impressive. And, im not churlish enough not to acknowledage that such a formidable force will bring behind it a resolute cadre of flag-waving fellow economists. Either nodding in agreement (_well, if they so..._) or, buoyed in their own right that their own conclusions have received the royal endorsement (_I told you so!..._).

Two points.

The (near) universal agreement is a stretch. Aside from Roubini, little economic research has been done on bitcoin and even what research has been done (Roubini) it is questionable whether it is now, or ever been, on target. It's possible he has been digging in the wrong place. The more I learn about bitcoin, the more I am leaning to that conclusion.
In the main, it is my impression that the economic profession is broadly silent on bitcoin. It is silent because for the most part most are unsure of what  it is, and for those who do comment on it, it is predominantly centered around its price action. Namely, anything that rises so fast and so high in value is sure to crash.
Guess what, if we were talking solely about price action I would agree with that also.

Secondly, as I have been pointing out, I am wary of economists giving verdicts on new technologies in industries removed from their field of expertise. I would rather judge economists, and their expertise, on matters of economics.
In no small part macro economics.
Now I will be first to acknowledge their expertise in the field of economics. However, a peculiarity in this field is Roubini's own status. In his own words he became "famous" for predicting the great financial crash. So much so they call him "Dr Doom!"

Now forgive me for thinking it is somewhat an oddity for an economist to become famous for studying economic data and making a correct economic prediction. What next? Mechanic replaces oil in car and declares engine will run smoother?
Of course I'm being facetious here. In order to become "famous" for economic predictions, one would have to stand out from the crowd.
Or to put it another way, to become famous for predicting an economic forecast, there would have to be (near) universal skepticism of his analysis of economic data by all the other economists. Otherwise he would not have become famous.

Economic forecasting is the bread-and-butter of the economic profession. If the profession itself, at a (near) universal scale is analysing the data that Roubini analysed and could not see what he saw, it is indeed a sorry state of affairs.
But in this discourse it is obviously in my interest to beat down on the economists. So I'm reminded of article where they do it themselves

This is how we let the credit crunch happen, m'am

Your move.


----------



## Duke of Marmalade

@WolfeTone I am just saying that the absence amongst bitcoin enthusiasts of any heavyweight economist (sorry Veldes and Amoss are not in that division) Is telling.  I am not saying it is checkmate.
The recent 3 fold rise in BTC is extraordinary and I haven’t a clue how 2021 will finish but surely a repeat of 2018 can’t be a remote possibility. Get out while you can and while it exceeds your target price and don’t accept any of that Tether rubbish.


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## WolfeTone

Duke of Marmalade said:


> I am just saying that the absence amongst bitcoin enthusiasts of any heavyweight economist (sorry Veldes and Amoss are not in that division) Is telling.



And Im just saying, it is _not_ telling, not telling at all!
My point is, if trying to understand understand bitcoin do not limit your understanding to economists. For sure, a robust and healthy dose of skepticism is overall beneficial. But you have to be minded to think that perhaps maybe, some of them are looking at bitcoin from the wrong perspective? They have plenty of form in that regard, as the chief Professor of  economiss to the London School of Economics testified to his Queen.


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## Duke of Marmalade

WolfeTone said:


> I would attribute more to the recent news stories of ECB and Federal Reserve additional stimuli as being of more significance, but that is just a matter of opinion.


Yes, that seems to be a factor - a big fear of hyperinflation even collapse of our economic system.  Antonopoulos (Mr Bitcoin) going so far as to state that he hopes that won’t happen.
But if that were the main explanation wouldn’t gold be also shooting the lights out?
Gold has gone sideways since last September, bitcoin has increased 250%, go figure


----------



## WolfeTone

Duke of Marmalade said:


> But if that were the main explanation wouldn’t gold be also shooting the lights out?
> Gold has gone sideways since last September, bitcoin has increased 250%, go figure



Perhaps, but whatever about allegations of bitcoin price manipulation, we know _as fact _gold price manipulation. 

JP Morgan fine

Secondly, the gold market is worth around €9trn? 
If bitcoin was not a player, perhaps gold would be worth €9.5trn?


----------



## Duke of Marmalade

WolfeTone said:


> Perhaps, but whatever about allegations of bitcoin price manipulation, we know _as fact _gold price manipulation.
> 
> JP Morgan fine


Yes, that probably explains it.  JP Morgan have turned their spoofing to bitcoin - 10 times its price by 2022.


----------



## Duke of Marmalade

WolfeTone said:


> Secondly, the gold market is worth around €9trn?
> If bitcoin was not a player, perhaps gold would be worth €9.5trn?


This doesn't make any sense to me.  If bitcoin warrants a 250% rise because of its Hyperinflation Insurance then, presuming gold has similar HI characteristics to bitcoin, it too should be showing huge rises.  You seem to think that for gold to increase by 250% would need over $20trn to enter the market.  Not at all, the price could go there with scarcely any transactional activity at all.
So, other than the JP Morgan spoof (not to be trivialised) nothing has occurred in recent months to give bitcoin such a huge increase, not only against the $ but also against gold.


----------



## Peanuts20

The value of your investment may rise or fall..................

I wonder if it will fall just after Jan 20th to give Joe Biden an issue? Or am I just too cynical about makey up money?


----------



## DazedInPontoon

Duke of Marmalade said:


> nothing has occurred in recent months to give bitcoin such a huge increase, not only against the $ but also against gold.


Firstly there was a significant amount of Institutional investment. Secondly, this was enough to be a signal to old time bitcoiners and retail 'investors' that the next growth cycle is beginning, especially when the previous all-time-high was breached.


----------



## tecate

Peanuts20 said:


> I wonder if it will fall just after Jan 20th to give Joe Biden an issue? Or am I just too cynical about makey up money?


I'm not sure I understand where you're going with that? Are you suggesting a price collapse and if so, what's the catalyst? How would this give Biden a problem?


----------



## WolfeTone

Duke of Marmalade said:


> You seem to think that for gold to increase by 250% would need over $20trn to enter the market.



Not at all, Duke. 
I do not know why the price of gold is subdued. I accept that the _proven _allegations of malpractice with regards its price will have something to do with it. Im not sure if JP Morgan were the only ones doing it, or just the only one who got caught doing it on a provable scale. There may be others, many others. But Im just speculating, similar to the tether/bitcoin speculation.

The other thing is the gold market is a long established market. From the individual, to the corporation, to the sovereign state, that gold is long accepted on a global scale as a form of money.
Bitcoin is nowhere near that scale of acceptance, it has merely peeped its head over parapet of the global financial system.


----------



## Duke of Marmalade

WolfeTone said:


> Not at all, Duke.


I don't understand your reference to Au going from 9trn to 9.5trn.
Watched Coindesk News.  It interviews a few crypto "experts" regarding the surge in price.  Explanations seem to split evenly between institutional involvement and hyperinflation hedge.  One guy repeated the argument that it was a combination of the increase in institutional demand and the reduction in supply because of the halving. This is such an unreal world that I have to fact check all statements.  I can confirm that the supply of bitcoins is higher now than it has ever been.


----------



## WolfeTone

Duke of Marmalade said:


> I don't understand your reference to Au going from 9trn to 9.5trn.



Don't get hung up on it, as I said I don't really know why the price of gold is subdued. 



Duke of Marmalade said:


> reduction in supply because of the halving. This is such an unreal world that I have to fact check all statements. I can confirm that the supply of bitcoins is higher now than it has ever been.



You do know that it is a reference to the supply of _new _bitcoin that the halving refers to?


----------



## tecate

Duke of Marmalade said:


> But if that were the main explanation wouldn’t gold be also shooting the lights out?
> Gold has gone sideways since last September, bitcoin has increased 250%, go figure


Before Christmas you said that the btc price should be so much higher if monetary expansion was a driver.  Now its much higher and you're still not happy. Gold is much higher over the last 18 months and you figure that bitcoin shouldn't outperform it even though its a much younger asset that is coming of age. Also, there has been some limited move from gold directly to bitcoin in recent weeks.


----------



## tecate

WolfeTone said:


> You do know that it is a reference to the supply of _new _bitcoin that the halving refers to?


He knows well but he's trying to build a different narrative.


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## Duke of Marmalade

WolfeTone said:


> You do know that it is a reference to the supply of _new _bitcoin that the halving refers to?


As @tecate observes, I am well aware.  I checked on Coindesk.  Around 3 million bitcoins traded in the last 24 hours.  Even if miners dump every single bitcoin they find as soon as they have washed them, that would account for less than 1k of that 3m i.e. less than 1 per 3 mil.  How so called experts can argue that a halving of the new coin supply has any material impact on the supply/demand dynamic is really telling.  The crypto phenomenon keeps telling me things.


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## Duke of Marmalade

tecate said:


> Before Christmas you said that the btc price should be so much higher if monetary expansion was a driver.  Now its much higher and you're still not happy. Gold is much higher over the last 18 months and you figure that bitcoin shouldn't outperform it even though its a much younger asset that is coming of age. Also, there has been some limited move from gold directly to bitcoin in recent weeks.


I'm just trying to get my head around the timing of the latest surge.  Several things at play here.
Institutional involvement 
The sound of printing machines in Fort Worth but that noise is not new and why is gold not benefiting, that's what puzzles me
Spoofing by so called respected names like JP Morgan targeting $146k (or is it $400k, they keep changing their minds which is perfectly understandable for something that moves 20% per day)
Manipulation by tether whales
Knock on FOMO of retail investors but also fund managers


----------



## tecate

@dukey: That's supply that has to go on to the market to cover significant mining costs.  You can try all you like to contrive it not to be significant when that supply is cut in half. It's simple math.


----------



## tecate

Duke of Marmalade said:


> I'm just trying to get my head around the timing of the latest surge.  Several things at play here.


What's at play is you're now saying the opposite of what you said previously in an attempt to maintain that negative narrative.


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## Duke of Marmalade

tecate said:


> @dukey: That's supply that has to go on to the market to cover significant mining costs.  You can try all you like to contrive it not to be significant when that supply is cut in half. It's simple math.


Absolute nonsense.  1 part in 3,000 is never significant.


----------



## tecate

Duke of Marmalade said:


> Absolute nonsense.  1 part in 3,000 is never significant.


I disagree. You cut supply that has to go onto the market in half - of course it makes a difference.


----------



## WolfeTone

Duke of Marmalade said:


> How so called experts can argue that a halving of the new coin supply has any material impact on the supply/demand dynamic is really telling.




_Duke, _with respect , you are positively flip-flopping from one perspective to next. 

The halving occurred last May. 

You seem to identify 1K new coins minted in out of a total 3m coins traded in last 24hrs.
I have to say 3m coins being traded in 24hrs, if accurate, is a phenomenal amount. As only 1k of these can be new coins, then it suggests heavy selling on the part of holders. This goes some way to explaining the 25%+ price pull back.


----------



## Duke of Marmalade

WolfeTone said:


> _Duke, _with respect , you are positively flip-flopping from one perspective to next.
> 
> The halving occurred last May.


  My current flip (or is it flop) is to try and understand why now this remarkable price action.  Coindesk asked their experts the same question and one of them mentioned the halving.  In fact my dear _theo _so did you.





			
				theo answering my question about recent price action in #18 said:
			
		

> Also, there was the halving of the block reward in March this year.


 BTW March or May? it is not important.


> You seem to identify 1K new coins minted in out of a total 3m coins traded in last 24hrs.
> I have to say 3m coins being traded in 24hrs, if accurate, is a phenomenal amount. As only 1k of these can be new coins, then it suggests heavy selling on the part of holders. This goes some way to explaining the 25%+ price pull back.


Check my numbers, maybe I have the decimal point in the wrong place but Coindesk says trade in the last 24h was $90bn which I think is about 3,000 coins.  Checking historically say over the last 2 years this is about double normal but even that is astonishingly high.  By comparison:





> There are currently 1,127,467,028 Ryanair shares in issue and the average daily traded volume is 641,279 shares.


  So that's less than 1 per mil for a normal stock.  Admittedly that other mind blowing phenomenon Tesla has very high turnover though not quite in the same league as bitcoin.
I did find a website which claimed that the mainstream reported volumes of bitcoin is fake news.  Their figure for the last 24h is around $20bn.


----------



## DazedInPontoon

A stat that's relevant and that someone may know is the number of coins actually deposited on the exchanges. For example if coinbase has 1k coin volume traded in a day but only has 100 coins deposited, we know the same coins were bought and sold multiple times in the day. 

I saw recently some numbers on net coin in/out-flow to exchanges, and it was showing that there has been a net outflow recently, i.e. that there are less coins on exchanges in total. I can't remember what exchanges it related to, and I don't have a link sorry. Maybe someone else does?


----------



## tecate

@DazedInPontoon ..btc held on exchange has dropped more recently. 

Link


----------



## WolfeTone

Duke of Marmalade said:


> In fact my dear _theo _so did you.



Ok _Duke, _perhaps I am misconstruing your point?
The halving last May reduced the supply of new bitcoin onto the market. If demand for bitcoin, since May, is also increasing at the same time as a reducing _new _supply its not hard to see prices increasing. 
If that new demand is significant (institutional hedge against inflation) then a surge is understandable, to me, anyway. 

However, if there is a significant trading of 3m coins as of the last 24hrs, then, in that 24hr period, the newly mined 1k coins will be of little significance to the price in that 24hr period.


----------



## Duke of Marmalade

WolfeTone said:


> However, if there is a significant trading of 3m coins as of the last 24hrs, then, in that 24hr period, the newly mined 1k coins will be of little significance to the price in that 24hr period.


Good, we agree.  Not @tecate.


			
				tecate addressing my statement that 1 in 3000 is insignificant said:
			
		

> I disagree.


----------



## tecate

Duke of Marmalade said:


> Good, we agree.  Not @tecate.


You can rework the same tired arguments like your friend Nouriel, Duke - it will make no difference.
You can even misrepresent what I said as you have done above and that won't make any difference either.


----------



## WolfeTone

Duke of Marmalade said:


> Good, we agree. Not @tecate.



_Duke, _with respect, if Irish housing stock is 1m, and there are 40,000 new units each year with 40,000 buyers all well and good.
Cut the supply to 20,000 and increase the demand to 70,000 buyers then we all know what happens.
If however, a wave of 250,000 units of the existing 1m stock comes onto the market for sale in a very short period, then supply of 20,000 _new_ units will be of little significance in supporting the price, despite the presence of 70,000 buyers.


----------



## tecate

78% of Bitcoin supply is NOT liquid.


----------



## Duke of Marmalade

WolfeTone said:


> _Duke, _with respect, if Irish housing stock is 1m, and there are 40,000 new units each year with 40,000 buyers all well and good.
> Cut the supply to 20,000 and increase the demand to 70,000 buyers then we all know what happens.
> If however, a wave of 250,000 units of the existing 1m stock comes onto the market for sale in a very short period, then supply of 20,000 _new_ units will be of little significance in supporting the price, despite the presence of 70,000 buyers.


_theo _I think we all understand how supply and demand works.  In the last 24 hours 3 million bitcoins changed hands.  Somewhere in there possibly all 930 shiny new bitcoins were sold.  I thought we agreed that this had not one iota of contribution to the 25% fall in price.  @tecate disagrees though s/he seems to think I am misrepresenting their use of the term "I disagree".
I am not reopening the silly hype about the halving but it is telling (again) that "experts" have so got that hype in their veins that they quote it as a contributory factor in the  recent price action when from every angle it is totally irrelevant.


----------



## Duke of Marmalade

tecate said:


> 78% of Bitcoin supply is NOT liquid.





> *Highly liquid* supply: 3 million BTC


Yep, that tallies with the volume in the last 24 hours.  That is a turnover of 1 in 6 bitcoins per 24h.  Compare with Ryanair shares 1 in 1,000 turnover in 24h.


----------



## tecate

Duke of Marmalade said:


> @tecate disagrees though s/he seems to think I am misrepresenting their use of the term "I disagree".


Let me help you out there your Dukeness. I'm correcting you on the bs you added (post =91).  It should just read "tecate said" - not that other nonsense. I'm not getting dragged in to your cherry picking of current volume - taking NO heed of what were regular volumes pre halving. It's very simple. There was X amount that had to be sold every day - now there's half of that amount that has to be sold. That is before we look at ordinary every day volumes.


Duke of Marmalade said:


> Yep, that tallies with the volume in the last 24 hours.  That is a turnover of 1 in 6 bitcoins per 24h.  Compare with Ryanair shares 1 in 1,000 turnover in 24h.


See above.


----------



## Duke of Marmalade

The below chart shows daily volume of c. $40bn before the halving.  And that was at a lower price representing around 4 million coins being traded per day.  The halving reduced this by 1,000 per day, assuming that miners dump their coins as soon as they mine them, which I certainly wouldn't blame them for, not for them the hype of a future price tag of $146k.


----------



## WolfeTone

Duke of Marmalade said:


> I think we all understand how supply and demand works.



I'm not so sure _Duke. _Your question appears to be to try understand the bitcoin halving last May with regard to its

a) recent price surge over the last six months, and
b) its price fall over the last 24hrs

in both instances you appear to suggest that the halving is insignificant?

I would suggest, that in a) it is significant, and in b) not so significant.


----------



## Duke of Marmalade

WolfeTone said:


> I'm not so sure _Duke. _Your question appears to be to try understand the bitcoin halving last May with regard to its
> 
> a) recent price surge over the last six months, and
> b) its price fall over the last 24hrs
> 
> in both instances you appear to suggest that the halving is insignificant?
> 
> I would suggest, that in a) it is significant, and in b) not so significant.


Let's agree to disagree.  In my book 1 in 3,000 is insignificant but I accept that is a subjective call.


----------



## WolfeTone

Duke of Marmalade said:


> In my book 1 in 3,000 is insignificant




On the face of it I would agree. A couple of points however. 

Firstly, the halving is related to an finite amount of bitcoin to be mined. Unlike the housing analogy where supply is cut, over the long term an increase in demand will increase the housing supply levels once more. 
Secondly, the halving is not necessarily by itself the critical factor. It is a signal to the market (albeit this signal is known in advance and may already be priced in) of increasing scarcity - and this maybe where my understanding of the technical side of bitcoin may need improving.
With increasing scarcity, the processing power to secure the bitcoin in mining needs to be increased. As the processing power is increased, the difficulty adjustment is also increased. As the difficulty adjustment is increased this makes the network more secure. 
In theory, the greater the security of the network, the more attractive it is to store money (if you are inclined to consider it is digital gold). As more money comes into bitcoin, the price starts to rise and in turn, a speculative run commences. And with most (nearly all) speculative runs it tends to overrun itself on the high side, inducing a price correction - itself being oversold. 

As it happens, the concept of bitcoin as digital gold is continually gaining momentum.


----------



## tecate

Duke of Marmalade said:


> Let's agree to disagree.  In my book 1 in 3,000 is insignificant but I accept that is a subjective call.


What's nonsense is your calculation. As per on chain analytics resource, Glassnode - 78% of BTC supply is illiquid.

Here's another stat for you.

Number of active bitcoin addresses

Notice that the mean average goes up and to the right - over the course of ten years....inclusive of the four years you've spent dressing it down. Clearly, your friend Nouriel hasn't been taking heed of that network effect. Here he is in April 2013 telling the world that bitcoin was an atrocity at $58.


----------



## Duke of Marmalade

WolfeTone said:


> With increasing scarcity, the processing power to secure the bitcoin in mining needs to be increased. As the processing power is increased, the difficulty adjustment is also increased. As the difficulty adjustment is increased this makes the network more secure.


Let me explain how the security of the blockchain works.  Each block comes with a Proof of Work.  The "work" referred to here is tweaking the block (through the nonce) until its SHA256 hash has the required number of leading 0's. This was originally set at 32.  So the number of tweaks and re-runs of SHA256 was of the order of 2^32 or 4 billion.  This was deemed quite good enough to ensure that it would be impossible to alter a block once it had become about 3 deep in the chain as everything ahead of it would also have had to be re-run and it would be impossible to catch up with the original blockchain which would have grown longer in the meantime.  The longest version of the blockchain is the one that is deemed the correct one.
This level of difficulty in the Proof of Work was called Difficulty of size 1.
But the Difficulty served another vital purpose, it would be automatically adjusted by the protocol to maintain the timing of the release of blocks to approximately 1 per 10 minutes.  This was an entirely different use of the Difficulty from its primary use in underpinning the Proof of Work.  The speed at which blocks could be added was determined by the processing power of the miners.  To cut a long story short the Difficulty level today is 21 trillion times the level 1 needed to secure the blockchain.  Think of that.  Today that trial and error SHA256 routine has to be run 21 trillion multiplied by 4 billion times to find the nonce that legitimately adds a block to the chain.  That's approximately $50,000 in electricity per block.
Now for your erroneous take on the halving.  The halving reduced the incentive for miners to apply processing power, rather like a 50% fall in the price.  Though the difference is that the halving would be anticipated and therefore to an extent already built in.  Nonetheless the Difficulty fell from 16 trillion to 13 trillion after the halving.  The recent surge in price has pushed the Difficulty to the dizzy heights of 21 trillion.
Main takeaway my dear _theo _is that at these silly Difficulty levels the security of the blockchain is not in any way at play, it is all about meeting the 10 minutes per block requirement.


----------



## Duke of Marmalade

tecate said:


> What's nonsense is your calculation. As per on chain analytics resource, Glassnode - 78% of BTC supply is illiquid.


Same source 3m is Highly Liquid.  The 930 new bitcoins should be seen in the context of either the 3m volume per day or the Glassnode assessment of 3m Highly Liquid.
As always you never, ever give any ground.  Can't you see that you are out on a limb on this one.  @WolfeTone concedes the point. You never will.  You don't happen to be related to an American guy with a strange comb over hairstyle, do you?


----------



## tecate

Duke of Marmalade said:


> As always you never, ever give any ground.
> @WolfeTone concedes the point. You never will.  You don't happen to be related to an American guy with a strange comb over hairstyle, do you?


That's a bit rich coming from you. I have discussed at length and repeatedly bitcoins shortcomings. I accept that it could still fail. Meanwhile you have never recognised any of the positive characteristics of bitcoin.

You're also wrong in your take on bitcoin network security. As the hashrate goes up, so too does the level of security making it the strongest network of its kind on the planet.


----------



## Duke of Marmalade

tecate said:


> You're also wrong in your take on bitcoin network security. As the hashrate goes up, so too does the level of security making it the strongest network of its kind on the planet.


That's what I mean by stubborness.  Do you concede that increasing the Difficulty is about controlling the timing of bitcoin release rather than adjusting the security level?  Careful, I am refreshing my understanding by re-reading Mastering Bitcoin by Antonopoulos, and that's how he describes the situation.
@WolfeTone admits to being light on the technicals of bitcoin.  I myself, not much further along that path, was explaining how I thought his view that "halving" increases security is erroneous.  It would have been more helpful if you, whom I presume to be expert in all things bitcoin, would comment as to which of us has that right.


----------



## tecate

I don't claim and have never claimed to be an expert on bitcoin first and foremost..far from it. An increased hashrate equals heightened network security.
You're going back over old arguments (covered over the course of 4 years) trying to find a way to meet your narrative...which doesn't put you in a strong position to talk about stubbornness!


----------



## Duke of Marmalade

tecate said:


> I don't claim and have never claimed to be an expert on bitcoin first and foremost..far from it. An increased hashrate equals heightened network security.
> You're going back over old arguments (covered over the course of 4 years) trying to find a way to meet your narrative...which doesn't put you in a strong position to talk about stubbornness!


That you didn't do the helpful thing and comment as to whether @WolfeTone or myself have it right on the interplay between "halving" and security should be a big pointer to @WolfeTone in that regard.


----------



## tecate

Don't be childish. I stated that an increased hashrate equals increased security.


----------



## DazedInPontoon

Duke of Marmalade said:


> Do you concede that increasing the Difficulty is about controlling the timing of bitcoin release rather than adjusting the security level?



I agree with everything you said in your previous detailed post about mining, except this. I see where you're coming from, but both are related. If the difficulty did not increase the rate at which blocks are mined would keep increasing, all of the bitcoin block rewards would already have been mined which would have perhaps not left enough incentive for miners to secure the network. 

The schedule of the block rewards is deliberate to give bitcoin time to grow. Both in terms of the diminishing block reward having higher fiat value, and the transaction fees increasing, so that miners still have sufficient incentives going forward. If there is any concern here, it's that the schedule will not give enough time.


----------



## Duke of Marmalade

DazedInPontoon said:


> I agree with everything you said in your previous detailed post about mining, except this. I see where you're coming from, but both are related. If the difficulty did not increase the rate at which blocks are mined would keep increasing, all of the bitcoin block rewards would already have been mined which would have perhaps not left enough incentive for miners to secure the network.
> 
> The schedule of the block rewards is deliberate to give bitcoin time to grow. Both in terms of the diminishing block reward having higher fiat value, and the transaction fees increasing, so that miners still have sufficient incentives going forward. If there is any concern here, it's that the schedule will not give enough time.


Glad to know I haven't got this all completely wrong.  The numbers are mind blowing, I am re-reading Antonopoulos and haven't got that far yet but I don't remember numbers that big.
I accept your clarification which for the benefit of @WolfeTone I will restate in a different way.  Mining is all about security.  Remuneration of miners is therefore a key ingredient.  Ultimately that remuneration will solely be in the form of transaction fees but until that level of maturity is reached the reward has to be enhanced by granting new bitcoins. The 1 in 10 minutes thing then is about giving the system time to reach the maturity where new bitcoin rewards are not necessary. 
Correct me if I have misinterpreted you.


----------



## DazedInPontoon

I think we're mostly on the same page, but I see mining as achieving multiple things at the same time, and I don't know if they can be considered separately. It relates to security in terms of the difficulty to re-mine blocks and overtake the main chain, it relates to incentives for miners to mine (which encompasses the block schedule) but the block schedule also relates to the *fair* distribution of new bitcoins. Mining relates to all of these things at the same time, and bitcoin doesn't really work without all of them.

Similarly you can probably ascribe many purposes to the halvings. Firstly, and most obviously it is the method by which the total eventual supply of bitcoin is limited to 21 million, secondly it means the supply distribution is front loaded which gave people an incentive to get involved in bitcoin early before it was at critical mass instead of waiting to see if it 'takes off'. This incentive to get people involved early was essential for it to reach critical mass, which I now consider it has.

Even more interesting is that the sharp drops by 50% every 4 years are now notable events that some would say cause a significant shock in terms of new supply and therefore price. It could have been done as a more gradual decrease, but it wasn't, I don't know whether this was intentional or not - but I would love to know. I don't know exactly how the halvings affect the price, but it has always gone up a lot in the months following one, it may just be a self fulfilling prophecy if enough bitcoiners expect it and decide not to sell in the period after one.

And on "The numbers are mind blowing" you need to account for the improvements in hardware too. the hashes per second that hardware can achieve has been growing over time as the hardware improves.


----------



## WolfeTone

Fair play @Duke of Marmalade , you have provided an interesting summary of some of the technological workings of bitcoin that certainly give pause for thought. As previously stated, I'm in the novice arena when it comes to the technological side. I suspect that perhaps this area has been trashed out elsewhere in other bitcoin threads, if so, it would be interesting to re-read through previous thread (which one?) once more rather than repeat ad nauseum.

In the meantime, trying to break down your summary in purest lay-person's language, I will set out my stall.

My understanding of your post is that the levels of difficulty in the chain are unwarranted as by the 3rd block, the mathematical equations were complex enough to ensure it was impossible to alter the block at this point as to do so would require a period of time and processing power that would be useless by virture that, over that same period of time another block (the 4th block) would have been added to the chain? And as this is now the longest version, then it was the valid chain. And any attempt to corrupt the chain would have to recommence on that chain? By which time, another longer chain would have developed and this is the valid chain? Or something like that?

And, in turn, as we are at block 630,000 or so, meaning it is impossible today, by any reasonable understanding to alter and corrupt the blockchain, so adding additional blocks is actually a waste of time and, significantly, energy?

Certainly, the electricity consumption has always been a red-flag in my patch of the woods.

_However, _it is the conceptual side that I consider I have a reasonable grasp with bitcoin.
It all goes back to the beginning of the concept of money in the first instance. This, however, I know has been trashed out on other threads so I wont start those wheels turning again, but the claim is bitcoin is 'digital gold'

Instead I shall, which should please you, revert to reknowned political and economic historian Niall Ferguson (not of Nobel calibre, but if I understand correct, he schmoozes in those circles).
His 6 part documentary series "The Ascent of Money" is worth a watch if you havent seen it already. Episode one is provides good insight into how money is nothing more than a human concept derived from trust. Over the ages as we know, all sorts of things were used as money in one manner or another, seashells, paper, clay tablets, God, metal.
The critical point is that gold became the globally accepted measure of money, because it was the hardest form of money.

If you are not inclined to watch the whole series, or even a full episode, I would recommend episode one from 8mins 30sec to 11mins 40sec's.

Ascent of Money episode 1

In Fergusons words "_money is not metal, it is trust inscribed. It doesn't matter what it is inscribed in, paper, clay, a screen, provided the recipient believes in it_"

So money is not metal, but if the price of gold rises high enough, there are miners willing to invest inordinate amounts of time, energy and resources to extract it out of the ground - it having become increasingly difficult to do by virtue of all the mining that has already gone before. And the only way to ensure that one piece of gold is new gold, and not a piece being double-spent, is to establish a vast network of vaults, registrations, custody orders etc on a global scale.

So all in all, there are technological elements of bitcoin that I am not comfortable with, however on a conceptual side it is a brilliant idea.

But what of the technological elements need resolving/improving?

So who do I listen to when trying to grasp a sense of progress in this area, economists? Nope, I listen to the technologists and innovators and entrepreneurs. And if you spend sometime listening to their side (not including price projections), then from my perspective, bitcoin is only at its infant stage of its life cycle. It hasn't even learned to walk yet.
It may not survive into adulthood, but it is growing fast and very robust. And, as it is being claimed, it is the hardest form of money, inscribed in digital form. That has value.


----------



## Duke of Marmalade

@WolfeTone food for thought there.  Meanwhile Key Post "Why bitcoin has value" is well worth a read especially the OP by @fpalb.


----------



## Duke of Marmalade

WolfeTone said:


> My understanding of your post is that the levels of difficulty in the chain are unwarranted as by the 3rd block, the mathematical equations were complex enough to ensure it was impossible to alter the block at this point as to do so would require a period of time and processing power that would be useless by virture that, over that same period of time another block (the 4th block) would have been added to the chain? And as this is now the longest version, then it was the valid chain. And any attempt to corrupt the chain would have to recommence on that chain? By which time, another longer chain would have developed and this is the valid chain? Or something like that?


Something like that.  Current difficulty levels are way, way in excess of what is necessary to make the blockchain incorruptible but as @DazedInPontoon explains they play their part in maintaining the integrity of the mining infrastructure which indirectly underpins the integrity of the blockchain.



> Certainly, the electricity consumption has always been a red-flag in my patch of the woods.


Never bothered me too much but then I am the sort who will be the last person to own an electric car.  



> Instead I shall, which should please you, revert to reknowned political and economic historian Niall Ferguson (not of Nobel calibre, but if I understand correct, he schmoozes in those circles).
> His 6 part documentary series "The Ascent of Money" is worth a watch if you havent seen it already. Episode one is provides good insight into how money is nothing more than a human concept derived from trust. Over the ages as we know, all sorts of things were used as money in one manner or another, seashells, paper, clay tablets, God, metal.
> The critical point is that gold became the globally accepted measure of money, because it was the hardest form of money.
> 
> If you are not inclined to watch the whole series, or even a full episode, I would recommend episode one from 8mins 30sec to 11mins 40sec's.
> 
> Ascent of Money episode 1
> 
> In Fergusons words "_money is not metal, it is trust inscribed. It doesn't matter what it is inscribed in, paper, clay, a screen, provided the recipient believes in it_"
> 
> So money is not metal, but if the price of gold rises high enough, there are miners willing to invest inordinate amounts of time, energy and resources to extract it out of the ground - it having become increasingly difficult to do by virtue of all the mining that has already gone before. And the only way to ensure that one piece of gold is new gold, and not a piece being double-spent, is to establish a vast network of vaults, registrations, custody orders etc on a global scale.


I'll give a discussion on the whole money thing a miss, but I will watch that clip.  Don't really get your point on the double spend of Au.  Au has a specific gravity of 19.32 and is completely verifiable, albeit it is not possible to ascertain whether it was newly mined, an heirloom or simply stolen.



> So who do I listen to when trying to grasp a sense of progress in this area, economists? Nope, I listen to the technologists and innovators and entrepreneurs. And if you spend sometime listening to their side (not including price projections), then from my perspective, bitcoin is only at its infant stage of its life cycle. It hasn't even learned to walk yet.
> It may not survive into adulthood, but it is growing fast and very robust. And, as it is being claimed, it is the hardest form of money, inscribed in digital form. That has value.


Let's agree to disagree.


----------



## Firefly

Well I'll be...


----------



## WolfeTone

Duke of Marmalade said:


> Current difficulty levels are way, way in excess of what is necessary to make the blockchain incorruptible



And, perhaps, difficulty levels in mining for gold are way in excess of what is necessary? Yet, overtime, industrialists have invested time and resources into developing better technologies to extract more gold where otherwise it would have remained out of reach.



Duke of Marmalade said:


> Never bothered me too much but then I am the sort who will be the last person to own an electric car.



And, like the electric car, is it possible that technologies and innovations will emerge, overtime, that will make bitcoin mining more energy efficient?


----------



## DazedInPontoon

WolfeTone said:


> And, like the electric car, is it possible that technologies and innovations will emerge, overtime, that will make bitcoin mining more energy efficient?



Regarding that, another crypto Ethereum is currently also using proof of work mining, but is planning to try switching to proof of stake, which as I understand it would replace proof of work mining entirely by users staking a balance of their coins. The general idea is that if miners have influence in proportion to their balance of ethereum they are thus incentivised to behave well enough to maintain security of the chain. One way or another I'm looking forward to seeing if they actually do change to proof of stake and if so how it works out for them. If it works well enough it could be an option for bitcoin.

But generally I'm on the side of using bitcoin for more things and gaining more value from the security of the chain rather than worrying too much about the proof of work mining. Bitcoin can be a global public good in the form of trustable immutable ledger, we should aim to use that for as many possible things as we can as the marginal cost of doing so is low to zero.


----------



## WolfeTone

DazedInPontoon said:


> But generally I'm on the side of using bitcoin for more things and gaining more value from the security of the chain rather than worrying too much about the proof of work mining. Bitcoin can be a global public good in the form of trustable immutable ledger, we should aim to use that for as many possible things as we can as the marginal cost of doing so is low to zero.



Indeed, and again, my technical-less brain is not the brain needed to progress and explain this, instead my brain-power (what's left of it ) recognises the potential inherent here.

It is this rabbit-hole, that the no-coiners need to get a grasp of. Too much of their time, Roubini et al, is focused on the bitcoin price. 
@Duke of Marmalade you need to step aside from the price volatility for a period and look behind the bitcoin curtain!


----------



## Duke of Marmalade

WolfeTone said:


> And, perhaps, difficulty levels in mining for gold are way in excess of what is necessary? Yet, overtime, industrialists have invested time and resources into developing better technologies to extract more gold where otherwise it would have remained out of reach.


I was just making the point that at these enormous difficulty levels we are way, way, beyond the difficulty level having any implications at the margin for the integrity of the blockchain.



			
				Wolfetone said:
			
		

> you need to step aside from the price volatility for a period and look behind the bitcoin curtain!


I am not a complete Luddite.  As a technology blockchain does not make me swoon but I can see it could have uses.
Let me remind you of my skepticism on bitcoin.  It derives from the observation of a bitcoin evangelist, John Kelleher.  He states that ultimately the only utility that bitcoin (not blockchain) can achieve is as a medium of exchange.  I think everybody accepts that it has not achieved that so far at least not to the extent of justifying a market cap of $600bn.  I agree with Professor Roubini that bitcoin is a not a currency (medium of exchange) and never will be.


----------



## WolfeTone

Duke of Marmalade said:


> I think everybody accepts that it has not achieved that so far



Indeed, with 'so far' being the salient point.


----------



## tecate

DazedInPontoon said:


> Regarding that, another crypto Ethereum is currently also using proof of work mining, but is planning to try switching to proof of stake, which as I understand it would replace proof of work mining entirely by users staking a balance of their coins. The general idea is that if miners have influence in proportion to their balance of ethereum they are thus incentivised to behave well enough to maintain security of the chain. One way or another I'm looking forward to seeing if they actually do change to proof of stake and if so how it works out for them. If it works well enough it could be an option for bitcoin.


I think once they've had it running for a decade, then bitcoin devs might consider it. Ethereons tend to move fast and break things which is great for innovation but not so great for a $600 billion network. For that reason, bitcoin development tends to be so much slower.


DazedInPontoon said:


> But generally I'm on the side of using bitcoin for more things and gaining more value from the security of the chain rather than worrying too much about the proof of work mining. Bitcoin can be a global public good in the form of trustable immutable ledger, we should aim to use that for as many possible things as we can as the marginal cost of doing so is low to zero.


I agree.  Microsoft has secured its digital identity project on it. Blockstack/Stacks has developed its blockchain to rely on the Bitcoin network for security and the founders of that project actively encourage others to do the same. 
i believe that there's room for one proof of work-based blockchain. That said, nobody will ever be accepting of its energy usage if they don't have an appreciation of what that blockchain can offer as a public good in the long run.


----------



## DublinHead54

tecate said:


> I think once they've had it running for a decade, then bitcoin devs might consider it. Ethereons tend to move fast and break things which is great for innovation but not so great for a $600 billion network. For that reason, bitcoin development tends to be so much slower.
> I agree.  Microsoft has secured its digital identity project on it. Blockstack/Stacks has developed its blockchain to rely on the Bitcoin network for security and the founders of that project actively encourage others to do the same.
> i believe that there's room for one proof of work-based blockchain. That said, nobody will ever be accepting of its energy usage if they don't have an appreciation of what that blockchain can offer as a public good in the long run.



I looked at Microsofts DID back in the summer when I was looking at digital identity. I didn't realise they were using the Bitcoin network rather than a standalone ledger / blockchain solution. How does it work on the Bitcoin network?


----------



## tecate

Bloomberg: "Bitcoin is Unlike Any Other Bubble We've Seen So Far"

Analysts for the world's largest publicly traded hedge fund came to this conclusion:

_“Instead of considering each individual spike and fall as a discrete bubble, there may be more merit in the argument that this volatility is simply part of the price discovery in a new asset class, and that these are not bubbles, but part of a not-so-random walk that will eventually dwindle to give Bitcoin more stability, and ultimately, legitimacy,” _


----------



## Duke of Marmalade

tecate said:


> Bloomberg: "Bitcoin is Unlike Any Other Bubble We've Seen So Far"
> 
> Analysts for the world's largest publicly traded hedge fund came to this conclusion:
> 
> _“Instead of considering each individual spike and fall as a discrete bubble, there may be more merit in the argument that this volatility is simply part of the price discovery in a new asset class, and that these are not bubbles, but part of a not-so-random walk that will eventually dwindle to give Bitcoin more stability, and ultimately, legitimacy,” _


"Price discovery"?.  Sounds fancy.  Investopedia describes it as finding the spot price at which willing buyers and sellers will trade, this is in contrast to the concept of "valuaton". 
BTC/USD is one of the most discovered price pairings on the planet.  At some stages in the last week the price was being discovered at a rate of more than $100bn per day.  The most price discovered pairing is EUR/USD which runs at about $800bn per day.
But there is a huge difference in the dynamics of the respective price discovery processes.  BTC/USD is almost entirely speculative which makes it hugely unstable.  EUR/USD is dominated by their respective utilities e.g. the EUR demand comes from US companies wanting to import from the EZ etc. and these are relatively stable phenomena.
So I assume that what is meant by the Man Group is that ultimately BTC/USD itself will stabilise and that will occur when speculation is a very minor part of the price discovery dynamic.  It will be like the EUR/USD i.e. underpinned by the demand for the respective utilities of the two "currencies".
I agree entirely with this as does John Kelleher. The price cannot be sustained indefinitely by specuation. I just can't see BTC ever having any significant utility as a medium of exchange.

_PS Interesting table of past bubbles in the Bloomberg link_


----------



## WolfeTone

Duke of Marmalade said:


> PS Interesting table of past bubbles in the Bloomberg link



Disappointing not to see our own property bubble in there. Maybe it was just our 15mins of infamy?



Duke of Marmalade said:


> It will be like the EUR/USD i.e. dominated by the demand for the respective utilities of the two "currencies".
> I agree entirely with this as does John Kelleher



So you accept it has value, or could have value? If, say, the respective utility is a hedge against inflating fiat currency?


----------



## Duke of Marmalade

WolfeTone said:


> So you accept it has value, or could have value? If, say, the respective utility is a hedge against inflating fiat currency?


First of all I have corrected my original post.  I think to say that the price discovery of EUR/USD is "dominated" by the utility aspect might be a bit misleading.  I don't think trade between the US and the EZ runs at $800bn per day.  I have changed the word "dominated" to "underpinned".

And this brings me to your second point.  As per John Kelleher all demand for a digital currency should be underpinned by its utility as a medium of exchange (unless it specifically has backing by some asset).  Speculative or Store of Value demand are overlays on this underpin. Without the underpin any further demand has no foundations.  And I don't think bitcoin will make it as a medium of exchange in any meaningful way.
Anticipating attack from the usual quarters this does not mean that all Store of Value candidates have to be first and foremost a medium of exchange.  Gold is actually a poor medium of exchange and Real Estate is quite useless.  But in the case of a unbacked digital currency, medium of exchange is its only possible underpinning utility.


----------



## DazedInPontoon

Duke of Marmalade said:


> And this brings me to your second point.  As per John Kelleher all demand for a digital currency should be underpinned by its utility as a medium of exchange (unless it specifically has backing by some asset).  Speculative or Store of Value demand are overlays on this underpin.



Why? For example MicroStrategy bought $1b of bitcoin, they've no intention of using it as a medium of exchange. Where does the necessity for the medium of exchange come from? other than that they have the ability to trade it in part or in full for dollars at some point in the future should they want to?


----------



## Duke of Marmalade

DazedInPontoon said:


> Why? For example MicroStrategy bought $1b of bitcoin, they've no intention of using it as a medium of exchange. Where does the necessity for the medium of exchange come from? other than that they have the ability to trade it in part or in full for dollars at some point in the future should they want to?


Just to repeat, I am endorsing John Kelleher's view.  JK is Investopedia' bitcoin guru.  He is a very avid supporter of the coin and he gives a lengthy argument to support its suitability as a medium of exchange.  As with most of my bitcoin sources I owe thanks to @tecate.
$100bn BTC/USD per day was trading recently.  Let's say that to all intents zilch of that was as a medium of exchange.  Price discovery is today totally underpinned by speculation.  Microstrategy might call it store of value.
What Man Group were arguing, I think, is that ultimately price discovery will stabilise.  They didn't quite say it but I presume that means it will reach a stage when some utility value is underpinning the price discovery rather than pure speculation. 
John Kelleher argues that the only utility value it can achieve is as a medium of exchange.  Just to stress that point, JK cannot see store of value being sustainable as a standalone utility, that can only be medium of exchange.  He goes on to suggest that it might take up 15% of global medium of exchange requirements and I think he puts a target price of $500,000.  I agree with his argument but not his forecasts.


----------



## WolfeTone

Duke of Marmalade said:


> He goes on to suggest that it might take up 15% of global medium of exchange requirements and I think he puts a target price of $500,000. I agree with his argument but not his forecasts.



Here is how I view such forecasts. 
What would have to be occurring in the global economy for bitcoin to hit $500,000? It is hard to imagine that joe soap public pitching a few dollars to even a few tens of thousands of dollars to drive the price up to that level? Maybe I'm wrong?

The only way I can see it hitting that level is if institutional money is ploughing into bitcoin. And at that level, it would suggest a hyper (or high) inflationary period in the fiat world. And in times of high inflation....it would not be beyond reason, imo, for people to start using other mediums of exchange for money.
And if you happen to own bitcoin, well, why not spend some of what cost you so little relative to a price of $500,000?


----------



## Duke of Marmalade

Forbes said:
			
		

> *The big guys on the block are still on the sidelines*
> 
> Now, despite bold calls in the media, none of the world’s ten largest asset managers bought Bitcoin directly or through Grayscale’s trust. Neither Blackrock nor Fidelity, Vanguard, Goldman Sachs GS +0.5% or the rest of the list that manages $32 trillion. Not one.
> 
> And most of Wall Street's top hedge fund managers still swear off Bitcoin.
> 
> Take Ray Dalio, the founder of the world’s largest hedge fund, Bridgewater Associates. In a recent interview for CNBC, he said: “It’s a shame. It could be a currency. It could work conceptually, but the amount of speculation that is going on and the lack of transactions [hurts it]”
> 
> Peter Boockvar, chief investment officer for Bleakley Advisory managing $5 billion, calls the idea that Bitcoin is replacing gold “absolute nonsense.” In a Monday note to clients he said: “Something with a 10+ yr history is not replacing something with a 5,000 year track record.”
> 
> While there are opposite—and very, very optimistic—predictions for Bitcoin (such as JP Morgan’s $146,000 target), neither of the asset managers making those calls disclosed any investments in Bitcoin so far.
> 
> Which leaves us hanging with more questions than answers.


----------



## WolfeTone

I can only read positives in that article @Duke of Marmalade. 

The fact that not one of ten largest asset managers, sitting on $32trillion, have bought into bitcoin, _yet,_ is intriguing. Imagine, if per chance, they put a very modest 0.01% of that $32trn ($3.2bn) into bitcoin at some point. What signal would that send to the rest of the global financial market?

I note Dalio's "it's a shame. It could be a currency" reference. There is the twinkle of a flame in such words, imo.

I agree with Boockvar, it is a nonsense that bitcoin is replacing gold on a 10:5,000yr ratio. Or in other words, $500bn:$9trn ratio.
What will the monetary ratio be in when the time ratio is 20:5,010yr ratio?

Here is the thing that is most striking. These guys are in the business of buying and selling, buy low, sell high. They have a fiduciary responsibility to obtain best value for their investors. Signaling to the markets an intention to buy _before _actually buying would be irresponsible. 
The most significant signal from that article is that the top asset managers are even commenting on bitcoin.

I had ceased my purchases of bitcoin, but I must now re-consider.


----------



## Duke of Marmalade

@WolfeTone That gives me great hope for Marmalade Coin, there was me depressed at no institutional take-up.


----------



## tecate

Duke of Marmalade said:


> As with most of my bitcoin sources I owe thanks to @tecate.


That one you found all on your own, Dukey. As for the rest (Nouriel and whomever else), you're more than welcome. It's just a shame that they don't have anything new to bring to the party.



Duke of Marmalade said:


> Price discovery is today totally underpinned by speculation.  Microstrategy might call it store of value.


I'm pretty sure Michael Saylor would call it a store of value given he's repeatedly talked about holding it over a mutli-year period.



Duke of Marmalade said:


> They didn't quite say it but I presume that means it will reach a stage when some utility value is underpinning the price discovery rather than pure speculation.


I don't think it would be reasonable to make that assumption. It may be that like Saylor and others, they see it as already acting as a store of value.



			
				Forbes via Dukey said:
			
		

> The big guys on the block are still on the sidelines


Absolutely - it's a beautiful thing. We only have a handful of them in yet. 1% from all of them and we're into exceptionally big numbers for bitcoin. This is the first time in history that Main Street has had an opportunity to front run Wall Street. That said, it seems that window is closing.



WolfeTone said:


> Here is the thing that is most striking. These guys are in the business of buying and selling, buy low, sell high. They have a fiduciary responsibility to obtain best value for their investors. Signaling to the markets an intention to buy _before _actually buying would be irresponsible.
> The most significant signal from that article is that the top asset managers are even commenting on bitcoin.


Good point. In Dalio's case, where he once dismissed bitcoin, more recently he tweeted out saying that he may have misunderstood it and was open to taking another look at it. Tying in with your point, his hedge fund simply couldn't take a position in bitcoin right now as it's gigantic relative to a bitcoin market that doesn't have sufficient liquidity/market size to accommodate it.



Duke of Marmalade said:


> That gives me great hope for Marmalade Coin, there was me depressed at no institutional take-up..


You're quite right to be optimistic, Dukey. If limited institutional take up has taken BTC to $40k, imagine what full on institutional take up will do..


----------



## Duke of Marmalade

DazedInPontoon said:


> I agree with everything you said in your previous detailed post about mining, except this. I see where you're coming from, but both are related. If the difficulty did not increase the rate at which blocks are mined would keep increasing, all of the bitcoin block rewards would already have been mined which would have perhaps not left enough incentive for miners to secure the network.


Finished reading Antonopoulos, though I skipped the Bitcoin Core source code stuff.  I was right about the numbers.  It currently takes around 100, billion, trillion hash attempts to validate a block.  It originally took 4 billion.
But I got it a bit wrong on the relationship between Difficulty and Integrity (of the blockchain).  There are at least 4 intermingled factors, the Difficulty, the Hash Power of the network (of miners), the Diversity of the miners and the 10 minutes.
Take Diversity first.  If there was only 1 miner one could have no confidence in the blockchain no matter how much Proof of Work she supplied.  It is reckoned that anything over 30% concentration in one control would be a threat.
The other 3 factors operate like this:  the greater the Hash Power then the greater the Difficulty to validate a block in 10 minutes.  So in a sense we do need these enormous levels of Difficulty so as to bring the Hash Power under control and we need the 10 minutes to ensure blocks cannot be confirmed too quickly as that would make it easier to generate hard and fraudulent forks.
But I was still right that the "halving" has no direct bearing on the integrity of the blockchain.  All else equal it should reduce the Hash Power (less incentive) and hence the Difficulty but these should cancel out.


----------



## WolfeTone

Duke of Marmalade said:


> But I got it a bit wrong on the relationship between Difficulty and Integrity (of the blockchain).



And what can we learn, if anything at all, from being 'a bit wrong'?


----------



## Duke of Marmalade

WolfeTone said:


> And what can we learn, if anything at all, from being 'a bit wrong'?


That we should take care commenting on bitcoin mining.
I was wrong to state that the current levels of Difficulty are way beyond what is necessary to secure the blockchain,  they are required precisely because the hash power of the network has increased so exponentially.  I am not alone in having misunderstanding of mining.


			
				WolfeTone said:
			
		

> Also, there was the halving of the block reward in March this year. This is part of the technical side that I trust more than understand.
> As much as I do understand it, it is that as the block reward has halved that the nodes/miners require more processing power to validate the blocks and earn the rewards. Or in short, it hardens the network against hacking, fraud, centralised control, etc.


This is just plain wrong at several levels.  Halving does not in any way increase the processing power, if anything the reduced incentive should reduce processing power. Increased processing power does not harden the network against hacking etc.  But you are in good company in getting this wrong.


			
				tecate said:
			
		

> You're also wrong in your take on bitcoin network security. As the hashrate goes up, so too does the level of security making it the strongest network of its kind on the planet.


It is the exact opposite. Increased hashrate means that it is easier to do the Proof of Work and thus makes it easier to corrupt the blockchain for fraudulent ends.  This has to be countered by increasing the amount of "work" that has to be "proved".  In fact it has been increased by a multiple of 21 trillion since the original Difficulty.  Admittedly it makes it more difficult for me to attack the blockchain with my laptop.  But for the players in the game the object is to keep the difficulty the same i.e. 10 minutes to get the right hash.  It is a constant race between the increased hash rate which makes it easier to attack the blockchain and increased Difficulty which puts on the brakes.
Dear _theo _I note that you trust this technical side more than understand it which is an honest admission.  Let me recommend Antonopoulos to increase your understanding.  Admittedly it is like seeing how sausages are made. Would put you off sausages.


----------



## Cricketer

Duke of Marmalade said:


> It is the exact opposite. Increased hashrate means that it is easier to do the Proof of Work and thus makes it easier to corrupt the blockchain for fraudulent ends.  This has to be countered by increasing the amount of "work" that has to be "proved".  In fact it has been increased by a multiple of 21 trillion since the original Difficulty.  Admittedly it makes it more difficult for me to attack the blockchain with my laptop.  But for the players in the game the object is to keep the difficulty the same i.e. 10 minutes to get the right hash.  It is a constant race between the increased hash rate which makes it easier to attack the blockchain and increased Difficulty which puts on the brakes.


I don't know what a tracker mortgage is.


----------



## tecate

Duke of Marmalade said:


> It is the exact opposite. Increased hashrate means that it is easier to do the Proof of Work and thus makes it easier to corrupt the blockchain for fraudulent ends.


If the attack vector is a 51% attack, then such an attack becomes much more difficult and costly to execute as the hash rate increases.  Higher hash rate = higher mining difficulty. As per the protocol, the difficulty level adjusts dynamically. This is what makes the Bitcoin network so much stronger than other networks. For that reason, much smaller proof of work networks have suffered 51% attacks because they have not gotten up to sufficient scale to provide for sufficient network security. My understanding is that it would cost at least a couple of billion dollars to execute a 51% attack on the Bitcoin network. That's dollar cost before we get into the actual logistics of carrying out such an attack. Beyond all that, the attack would be obvious, the network could be hard forked - leaving the attackers out of pocket....ergo, it wouldn't make economic sense.


----------



## Duke of Marmalade

tecate said:


> If the attack vector is a 51% attack, then such an attack becomes much more difficult and costly to execute as the hash rate increases.  Higher hash rate = higher mining difficulty. As per the protocol, the difficulty level adjusts dynamically. This is what makes the Bitcoin network so much stronger than other networks. For that reason, much smaller proof of work networks have suffered 51% attacks because they have not gotten up to sufficient scale to provide for sufficient network security. My understanding is that it would cost at least a couple of billion dollars to execute a 51% attack on the Bitcoin network. That's dollar cost before we get into the actual logistics of carrying out such an attack. Beyond all that, the attack would be obvious, the network could be hard forked - leaving the attackers out of pocket....ergo, it wouldn't make economic sense.


Okay, I accept that, though my own analysis is not wrong.  A higher hash rate needs the Proof of Work to be made more difficult to maintain the security of the blockchain.  But yes, this increased difficulty level makes an  attempt to achieve 51% control more difficult.  I would accept that bitcoin is probably the most robust of the crypto platforms.


----------



## Duke of Marmalade

Cricketer said:


> I don't know what a tracker mortgage is.


I think you are on the wrong pitch.  We are playing senior hurling here.


----------



## joe sod

What about Christine lagarde's comments last week again referencing bitcoin's use in crime and money laundering, she warned retail investors that they could lose all their money and that authorities are going to step in and make it much more difficult to hold it as an asset or at least strip away all the attributes that make it an asset. Of course bitcoin is closely associated with the technology boom and its acceleration in 2020 . Anyone investing in Tesla or the FAANGS is also probably investing in bitcoin as diversification because they regard it as "digital gold".
If there is another tech crash which many people now think is impossible but could happen when the "real" economy springs back to life after the end of corona lockdowns. In that scenario would bitcoin be regarded as an "alternative" asset diversified from tech or another overvalued tech asset?
In March 2020 during the initial corona panic, bitcoin crashed just like Tesla and the other speculative Tech assets it didn't hold its ground. Of course then just like Tesla  its had a spectacular performance. But the point is that bitcoin is not really diversified from speculative tech.


----------



## Cricketer

Duke of Marmalade said:


> I think you are on the wrong pitch.  We are playing senior hurling here.


Was thinking my straight bat was feck all use. They were right when they said it was a mixture of hockey and murder.


----------



## tecate

joe sod said:


> What about Christine lagarde's comments last week again referencing bitcoin's use in crime and money laundering, she warned retail investors that they could lose all their money and that authorities are going to step in and make it much more difficult to hold it as an asset or at least strip away all the attributes that make it an asset.


Here are her comments - LINK. Have a listen again as I think there's a misunderstanding. She clearly refers to a desire for greater regulation. However, there's nothing explicit re. '_making it much more difficult to hold it_'. With regard to '_stripping away all attributes that make it an asset_', that's simply impossible. No individual or government has that power over bitcoin as such attributes are inherent characteristics of the asset itself.

On her comments re. bitcoin and money laundering, two things:

1. Talk about the pot calling the kettle black. Lagarde is a convicted criminal. If you carry out a bitcoin transaction, that transaction is signed (cryptographically) by you. Take out your wallet and pull out a €5 note and you will see that your €5 promissory note bears the signature of a criminal.
2. Whilst at a more embryonic stage, bitcoin was utilised by those who frequented the legendary darkweb marketplace, The Silk Road, more recent studies have found that only 1% of bitcoin transactions are illicit. Law enforcement authorities prefer bitcoin to cash as it provides them with so many traceable data points.
Cash has always been the means of exchange of choice of criminals. Meanwhile ....$330,904,834,105
That's the figure that banks have paid over the past 10 years in fines related to money laundering and manipulation. Bear in mind that it's still very much worth their while as they're just paying cents on the dollar for the epic levels of money laundering activity they continue to engage in....ergo the actual amount of money laundered has to be immense relative to the fines paid.
It's rich of Lagarde to try and tar and feather and to do so without presenting any evidence. She disingenuously alludes to it - yet she doesn't present with anything substantive/conclusive. Here's Economist Daniel Lecalle and his take on Lagarde's condemnation of bitcoin  -> LINK

Governments will want to tax it - so regulation will be required for that. If the thought is that they will smother it, she alludes to the problem there. It would need every single government on the planet to agree on that. Governments move much slower than technology. Secondly, when do they ever all agree in unison? I think its highly unlikely we will see that. In the meantime, there is a solid case to be made that bitcoin has reached escape velocity already. Bitcoin is niche - but it's moving out of that niche. As of November 2020, over 30 million bitcoin wallet addresses with active balances existed. You then have more people exposed via the likes of Grayscale, Square and Paypal. If your direct action as a politician/public official harms them, that could be a political own goal.
We're also assuming above that regulation could be negative. It can also be positive. Outside of FATF (which seems unworkable) and Steve Mnuchin's antics, US regulation has been positive for crypto more recently. It may be that they're cognisant of the innovation that's emerging from that sector and are choosing to nurture it rather than kill it.



joe sod said:


> Of course bitcoin is closely associated with the technology boom and its acceleration in 2020 . Anyone investing in Tesla or the FAANGS is also probably investing in bitcoin as diversification because they regard it as "digital gold".


Insofar as there's cross over between the profile of folk who piled in on the likes of Tesla, etc and bitcoin - sure. However, there are other cohorts like gold bugs and libertarians, etc. More recently there are the first movers in the institutional space such as company treasurys (MicroStrategy & Square), pensions (Mass Mutual), Family Offices & RIAs. Earlier this week, the Mayor of Miami expressed an interest in holding bitcoin within the city's treasury fund.



joe sod said:


> If there is another tech crash which many people now think is impossible but could happen when the "real" economy springs back to life after the end of corona lockdowns. In that scenario would bitcoin be regarded as an "alternative" asset diversified from tech or another overvalued tech asset? In March 2020 during the initial corona panic, bitcoin crashed just like Tesla and the other speculative Tech assets it didn't hold its ground. Of course then just like Tesla  its had a spectacular performance. But the point is that bitcoin is not really diversified from speculative tech.


Is there a need to make a distinction between tech crash or general markets crash ...they're probably one and the same thing at this point in any event?  If the conventional market crashes, I believe bitcoin is going down with it. However, in those market conditions, traders need to cover loses on leveraged postions, and ordinary investors need to put hands on funds to cover other losses. They don't care where it comes from. For that reason, gold took a dive (-30%) in the aftermath of the 2008 crisis - only to recover later. Have a look at the thread Brendan started in March ('_Why is Bitcoin 'Digital Gold' Crashing Right Now_') and you'll see that gold took a dive (-13%) in that case also. It responded but only after taking an initial hit. Bitcoin did the same - but suffered a greater correction as its available to be traded 24/7 and it's the much lesser proven asset.

I was concerned all through 2020 that another conventional market correction was coming - but no sign. Anyone credible seems to agree that the markets don't reflect actual economic reality. If bitcoin is to catch up with what happened with the conventional markets, then some commentators believe it needs to reach a figure of $55,000. I'd imagine some fine day, conventional markets have to correct - but who can call/time that? I could never answer the question and still can't and so exhausted with that, I take it back to my current conviction in bitcoin as an asset....ergo, if xxxx hits the fan and I'm caught unaware, I'm going to continue to hold the asset over the longer term.


----------



## Duke of Marmalade

I paid $10 for my hero Nouriel Roubini's fortnightly webinar.  These were the topics he covered yesterday.


			
				Roubini Webinar said:
			
		

> Are crypto-currencies, including Bitcoin, truly currencies?
> How do crypto-currencies resolve or not resolve Buterin’s inconsistent trinity on
> scalability, security, and decentralization?
> What is the outlook for Central Bank Digital Currencies? Do they have anything to do
> with crypto and/or blockchain?
> What is the outlook for blockchain/DLT technologies?
> What is the state of regulations now in the US? Will crypto-currencies be heavily
> regulated in the near future?
> What is the outlook for DeFi? Will there be regulations for DeFi apps in the near future?
> How does DeFi compare with FinTech?
> How to price/evaluate Bitcoin and other crypto-currencies? Are they worth anything?
> Why do companies such as Square and MicroStrategy decide to buy Bitcoin when it is a speculative asset? Is crypto becoming institutionalized?
> Is there a future for private stablecoins? Why did the Facebook Libra project fail?
> Will Bitcoin become the “Digital Gold” and supplant gold as a store of value?


Wonderful stuff.  I liked the bit where he trashed this institutional interest meme.  Quoted some institutional guy who predicted a couple of weeks ago a price of $400k but has now put his target for 2021 as a fall to $20k.  Chancers the whole lot of them.


----------



## WolfeTone

Duke of Marmalade said:


> I paid $10





Duke of Marmalade said:


> Quoted some institutional guy



Money well spent


----------



## tecate

Epic investment Dukey. Fascinating to imagine just what $10 can buy you these days!


----------



## Duke of Marmalade

@tecate I have you to thank of course.  Are you sure you don't get some sort of fees as Roubini's agent


----------



## tecate

Duke of Marmalade said:


> @tecate I have you to thank of course.  Are you sure you don't get some sort of fees as Roubini's agent


Dukey, I know Dr. Doom provides you with confirmation bias p0rn but if you think I'm kicking myself for bringing him to your attention, that's definitely not the case. There is nothing that Roubini has brought up that hasn't been discussed here already - he has nothing new to add. Secondly, you rate him but just listening to him its clear that he has no objectivity whatsoever in assessing the merits or otherwise of decentralised currency. If he owes me commission tell him that I'll accept it in USDT.


----------



## tecate

Nothing wrong with critiquing the crypto sector re. market manipulation so long as the same standard is applied to the conventional game. Today we have Robinhood and the big money banning outsider trading (ref. Gamestop.AMC, etc). It seems there's nothing wrong with how the game is played until the little guy gets on the upside of it.

And then you have practices like this.


----------



## Duke of Marmalade

tecate said:


> Epic investment Dukey. Fascinating to imagine just what $10 can buy you these days!


I tried to pay with Marmalade Coins but the guy is so neurotic about crypto he wouldn't accept even them.  Anyway it hit my digital BoI credit card statement today for €8.43.


----------



## WolfeTone

Duke of Marmalade said:


> Anyway it hit my digital BoI credit card statement today for €8.43.



That's about 0.000324 satoshis, better you use fiat though, those satoshis will be worth a lot more before long. 

The shenanigans exposed in the Game Stop affair mentioned by @tecate are just the tip of a melting iceberg I reckon. 
Get out now Duke while you can.


----------



## WolfeTone

So Elon Musk, the richest guy in the world (give or take ten billion or so), has edited his Twitter page with #bitcoin symbol.

He tweeted the following, "In retrospect it was inevitable".

Whats going on here? What could he be possibly signaling to 40m + followers?


----------



## Younginvestor93

WolfeTone said:


> So Elon Musk, the richest guy in the world (give or take ten billion or so), has edited his Twitter page with #bitcoin symbol.
> 
> He tweeted the following, "In the end it was inevitable".
> 
> Whats going on here? What could he be possibly signaling to 40m + followers?


He means he is going to put bitcoin on balance sheet of Tesla and SpaceX. Other companies will follow suit. Bitcoin will rise to the moon, potentially mars also.


----------



## DazedInPontoon

I wouldn't necessarily take Elon's twitter that seriously. His twitter bio might be "#bitcoin" now, but it was also recently "Former CEO of Dogecoin" for a while. Seriously.


----------



## WolfeTone

DazedInPontoon said:


> I wouldn't necessarily take Elon's twitter that seriously. His twitter bio might be "#bitcoin" now, but it was also recently "Former CEO of Dogecoin" for a while. Seriously.



Very true, it is afterall only his Twitter account. All the same, he has it there for a reason.


----------



## DazedInPontoon

Oh yeah, I wouldn't be surprised if he bought bitcoin, or has held some for a long time, or never buys any and is just amused by it, and I wouldn't read much into his twitter to determine what the case is.

I'm pretty sure in the past he just randomly tweeted "bitcoin" as a one word tweet, and I can only guess he did it for the amusement of seeing what effect he could have on the market by doing so.


----------



## tecate

Elon has managed to make his thoughts known on bitcoin:

_"I am late to the party. I am a supporter of Bitcoin. It’s on verge of wide acceptance by the financial world. "_


----------



## Allpartied

tecate said:


> Elon has managed to make his thoughts known on bitcoin:
> 
> _"I am late to the party. I am a supporter of Bitcoin. It’s on verge of wide acceptance by the financial world. "_



There is a well known adage that when the shoe shine boy is buying stocks, that the bubble is ready to burst. 

Has everything turned around? 

Nowadays the shoe shine boy is first in and it might be the case that when " the financial world" starts buying, it's time to bail out.


----------



## tecate

Allpartied said:


> Has everything turned around?
> 
> Nowadays the shoe shine boy is first in and it might be the case that when " the financial world" starts buying, it's time to bail out.


To my knowledge, bitcoin is the first and only time that wall street has been front run on a new financial asset. It depends on what your thesis is on bitcoin and whether there's something tangible there or not. Mine remains that over the longer term, it has much more to accomplish. That doesn't mean that there won't be volatility in both directions along the way.


----------



## Allpartied

tecate said:


> To my knowledge, bitcoin is the first and only time that wall street has been front run on a new financial asset. It depends on what your thesis is on bitcoin and whether there's something tangible there or not. Mine remains that over the longer term, it has much more to accomplish. That doesn't mean that there won't be volatility in both directions along the way.



I think the internet has changed the world and will continue to change the world.  

We are only in the early stages of this revolution, which will be as significant as the invention of the printing press.  It will change everything.  Just like the printing press, govts, vested interests and authorities will try to control it, but it will be impossible. 

The Gamestop fiasco is an example of collectivism working against capital.  Marxism in action.


----------



## tecate

Allpartied said:


> I think the internet has changed the world and will continue to change the world.
> 
> We are only in the early stages of this revolution, which will be as significant as the invention of the printing press.  It will change everything.  Just like the printing press, govts, vested interests and authorities will try to control it, but it will be impossible.


I agree.


Allpartied said:


> The Gamestop fiasco is an example of collectivism working against capital.  Marxism in action.


I'm not sure if that's marxism that's implicated. That rabble are a patchwork of all sorts - and I'd imagine there's many of them that would consider themselves anything but marxists. Some of it may be principled, some of it moronic - but its their $ and they're as much entitled as the hedge funds to take a position (without other stakeholders rigging the game).


----------



## Allpartied

tecate said:


> I agree.
> I'm not sure if that's marxism that's implicated. That rabble are a patchwork of all sorts - and I'd imagine there's many of them that would consider themselves anything but marxists. Some of it may be principled, some of it moronic - but its their $ and they're as much entitled as the hedge funds to take a position (without other stakeholders rigging the game).



Of course, they don't realise they are acting as Marxists.  They probably view themselves as great innovators, one step ahead of the machine. 

But, if the lesson, they learn is that collective action is much more beneficial than individuals competing to cut each other's throats, then that may be very positive.   Use the platforms of the internet, to organise on the shop floor, in the workplace, in the voting booth and on the streets.  

In the 1930's depression years,  it wasn't the rebel bank robbers, the Bonnie and Clydes , who shook up the system.  It was the labour unions, the radical organisers in the cities who stirred the masses and challenged the vested interests of capital.


----------



## WolfeTone

Allpartied said:


> Use the platforms of the internet, to organise on the shop floor, in the workplace, in the voting booth and on the streets



Interesting perspective.


----------



## DazedInPontoon

From Tesla recent 10k form on sec.gov website (AAM won't allow me include the actual link):

In January 2021, we updated our investment policy to provide us with more flexibility to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity. As part of the policy, which was duly approved by the Audit Committee of our Board of Directors, we may invest a portion of such cash in certain alternative reserve assets including digital assets, gold bullion, gold exchange-traded funds and other assets as specified in the future. Thereafter, we invested an aggregate $1.50 billion in bitcoin under this policy and may acquire and hold digital assets from time to time or long-term. Moreover, we expect to begin accepting bitcoin as a form of payment for our products in the near future, subject to applicable laws and initially on a limited basis, which we may or may not liquidate upon receipt.


----------



## tecate

Tesla ticking the store of value and means of exchange boxes re. bitcoin.



> From Tesla recent 10k form on sec.gov website (AAM won't allow me include the actual link):


----------



## 24601

tecate said:


> Tesla ticking the store of value and means of exchange boxes re. bitcoin.



I think we would be well-minded to ignore the significance of anything Tesla and Elon Musk do.


----------



## DublinHead54

I wonder what the SEC's view is on corporates making speculative investments. In my experience car makers and corporates don't typically also have financial markets investment arm making speculative investments. 

I assume the acceptance of BTC will follow that of Paypal and be a taxable event for individuals. 

I did see Elon has been pumping 'Dogecoin' a meme based cryptocurrency lately on twitter.


----------



## tecate

24601 said:


> I think we would be well-minded to ignore the significance of anything Tesla and Elon Musk do.


Can you elaborate on that line of thought?


----------



## Duke of Marmalade

tecate said:


> Tesla ticking the store of value and means of exchange boxes re. bitcoin.


What page should I read?
This could be a game changer.
Not that it will change mine or Roubini's mind.
But it is in a different league from Microstrategy(who?).
Elon Musk cannot be ignored.  Everyone on Wall Street and even in the wider academic community has to take a firm position now.
I honestly can't see a strong consensus behind his move but rather a robust mainstream rejection which could herald the denouement of this crazy business.


----------



## DazedInPontoon

Pages 23, 33 and 46 mention bitcoin, just search for "bitcoin" and you'll find it.

I'm kind of surprised Musk did it.


----------



## Duke of Marmalade

The notes wouldn't exactly fill me with confidence.  But I am not underplaying the significance of such a high profile endorsement albeit by someone whose rockets can't get off the ground.
The but about adoption as a medium of exchange is of course a nonsense.  They will accept bitcoin as payment which they say they may "immediately liquidate".


----------



## Thargor

Rockets cant get off the ground? I know Musk triggers certain people like a hairy version of Greta Thunberg but thats some seriously warped analysis of SpaceXs success, how do even come to that conclusion with all the available evidence?


----------



## WolfeTone

Thargor said:


> how do even come to that conclusion with all the available evidence



The same way that he still thinks Bitcoin is worthless!


----------



## WolfeTone

Duke of Marmalade said:


> I am not underplaying the significance of such a high profile endorsement




_Well, you kind of are underplaying it......?_


Duke of Marmalade said:


> albeit by someone whose rockets can't get off the ground.





Duke of Marmalade said:


> The notes wouldn't exactly fill me with confidence.





Duke of Marmalade said:


> The bit about adoption as a medium of exchange is of course a nonsense


----------



## Sunny

So we now have a company in the midst of a share price bubble 'investing' in an 'asset' that is in the midst of a price bubble. What could possibly go wrong..............


----------



## tecate

Sunny said:


> So we now have a company in the midst of a share price bubble 'investing' in an 'asset' that is in the midst of a price bubble. What could possibly go wrong..............


Perhaps TSLA is an extreme example but many would point you towards the fact that the conventional markets are nothing more than a casino with no earthly connection with the real economy. Tesla isn't alone - the valuations of most publicly traded companies have been driven by massive asset inflation. In 2020, many conventional stocks and commodities were far more volatile than bitcoin. It's symptomatic of something far more fundamental being out of whack.
As regards the bitcoin 'bubble' suggestion, I guess you are on board with the notion of a perpetual inflating and deflating bubble. 1 btc = 1 btc - just like it was 12 years ago and every year in between. It's the nature of sovereign money and the way it has been managed over the past 50 years that's the key to all this. Or who knows...maybe we can continue to print our way into the distant future...into oblivion.


----------



## Younginvestor93

I listened to an Irish financial advisor tonight suggesting it is probably time for people to have a small amount of their portfolio in bitcoin.
It would be interesting to hear where the askmoney posters think bitcoin is heading, a slightly different market to the reddit crowd I think!

Is it good financial advice to invest and what percentage of a portfolio should be dedicated to it in your opinion?

RTE news had a segment on it today and now everyone and their mother knows about it so this might be a bit concerning. As Buffet says be 'greedy when people are fearful and fearful when people are greedy'


----------



## tecate

Younginvestor93 said:


> I listened to an Irish financial advisor tonight suggesting it is probably time for people to have a small amount of their portfolio in bitcoin.


Which Irish financial advisor was that? 



Younginvestor93 said:


> It would be interesting to hear where the askmoney posters think bitcoin is heading, a slightly different market to the reddit crowd I think!


There are a few price prediction threads within this section. The last one I *think was done when btc was at around 20k. All I will say is that btc is the most transparently finite financial asset that has ever existed. 
As regards AAM setting itself apart from Reddit, I don't think there's going to be any anti status quo movement emerging here.



Younginvestor93 said:


> .As Buffet says be 'greedy when people are fearful and fearful when people are greedy'


In reality hard to implement but a good approach to take in this instance. Nobody wanted it when  it was at 4k last March or 3k in Nov. 2018.


----------



## Younginvestor93

tecate said:


> Which Irish financial advisor was that?


Paul Merriman, was talking about it on his instgram live. He has built up quite a following of late.


----------



## RedOnion

Younginvestor93 said:


> I listened to an Irish financial advisor tonight suggesting it is probably time for people to have a small amount of their portfolio in bitcoin.


I listened to part of it. He used the words: "It's high risk. I'm not recommending you do it".
then went into the fact he's regulated by the central bank, and therefore can't recommended unregulated products.

Can you tell us the time in the video he suggested it was time to have invested in Bitcoin?


----------



## Younginvestor93

RedOnion said:


> I listened to part of it. He used the words: "It's high risk. I'm not recommending you do it".
> then went into the fact he's regulated by the central bank, and therefore can't recommended unregulated products.
> 
> Can you tell us the time in the video he suggested it was time to have invested in Bitcoin?


It was the very first question that came in, he suggested if you have 400/500 a month spare to invest monthly, to put €420 in equities (he advises the Zurich dynamic fund) and 80 into bitcoin.


----------



## RedOnion

Younginvestor93 said:


> It was the very first question that came in


Of course I missed that! He addressed crypto again later where he covered all the regulatory bits. I know who Paul is, so was surprised to hear he's be recommending it without all the regulatory warnings.

Even with that first question, he said it's still a gamble in his opinion. And it's time to 'consider' a very small portion.


----------



## tecate

Twitter now considering holding btc as a reserve asset.  Link.


----------



## RedOnion

tecate said:


> Twitter now considering holding btc as a reserve asset.  Link.


There's just a little bit of a disconnect between the tweet, and what's actually written in the article:
"_Segal said if Twitter employees and vendors ask to be paid in bitcoin, then the company may consider investing in bitcoin as part of its treasury."_


----------



## tecate

It seems that Mastercard (just like Paypal) plans on enabling merchants to accept crypto payments later this year. The company has yet confirm which crypto's it will facilitate. This news follows on from Visa's announcement last week that it has started a pilot project to offer a service to banks to allow them to facilitate their customers in the buying/selling of digital assets.


----------



## Brendan Burgess

A 9 minute interview on Coindex with Roubini.



[broken link removed]

Covering  Tesla and Bitcoin.
Tether and Bitcoin.
Central Bank digital currencies

_NYU Economics Professor Nouriel Roubini, reiterating his objection to bitcoin, lashes out at Tesla and other corporations that recently announced their investment in BTC, calling it irresponsible corporate behavior and accusing them of market manipulation. He calls on the SEC to investigate._

Brendan


----------



## Duke of Marmalade

Brendan Burgess said:


> A 9 minute interview on Coindex with Roubini.
> 
> 
> 
> [broken link removed]
> 
> Covering  Tesla and Bitcoin.
> Tether and Bitcoin.
> Central Bank digital currencies
> 
> _NYU Economics Professor Nouriel Roubini, reiterating his objection to bitcoin, lashes out at Tesla and other corporations that recently announced their investment in BTC, calling it irresponsible corporate behavior and accusing them of market manipulation. He calls on the SEC to investigate._
> 
> Brendan


My hero.  He has said it all before and I luv it every time.  He effectively calls Musk a crook, that takes courage. That idiot in the corner laughing at Roubini only reinforced the message.


----------



## DublinHead54

Brendan Burgess said:


> A 9 minute interview on Coindex with Roubini.
> 
> 
> 
> [broken link removed]
> 
> Covering  Tesla and Bitcoin.
> Tether and Bitcoin.
> Central Bank digital currencies
> 
> _NYU Economics Professor Nouriel Roubini, reiterating his objection to bitcoin, lashes out at Tesla and other corporations that recently announced their investment in BTC, calling it irresponsible corporate behavior and accusing them of market manipulation. He calls on the SEC to investigate._
> 
> Brendan



I would tend to agree that the SEC should investigate Tesla / corporates. I think this  highlights weak corporate governance in Tesla and too much control by Musk.

I really don't see how / why a corporation should and can allow speculative investments, it certainly isn't common practice to my knowledge. Given that Bitcoin is now being treated more as 'gold' type asset rather than a currency, and companies don't hold gold. It is a very strange practice!

_Before I am accused of being anti-bitcoin, my comments have nothing to do with Bitcoin and bitcoin could be replaced with any volatile assets. I am highlighting that this is not good corporate governance. However, specifically to Bitcoin this is not evidence that it is now going to be used more. _


----------



## Brendan Burgess

Duke of Marmalade said:


> That idiot in the corner laughing at Roubini



I was wondering about that.  I don't think he was laughing at him in a dismissive way. He was greatly amused. But I was laughing too.


----------



## tecate

Brendan Burgess said:


> I was wondering about that.  I don't think he was laughing at him in a dismissive way. He was greatly amused. But I was laughing too.


No, he was laughing at him as he would watching a performing clown. Afterall, this is the genius that wrote bitcoin off at $13 and every point in between. That was the whole point of the exercise. It's a bit naughty of Coindesk to roll out this jester in order to illicit a certain response as part of the launch of Coindesk TV. Nouriel can be a filthy animal and make 'cocaine addict' jibes all day long - it only reflects poorly on himself as someone who lacks a modicum of class. We're talking about the views of a gravy-train academic who has built nothing against those who have built innovative companies.


----------



## DublinHead54

tecate said:


> No, he was laughing at him as he would watching a performing clown. Afterall, this is the genius that wrote bitcoin off at $13 and every point in between. That was the whole point of the exercise. It's a bit naughty of Coindesk to roll out this jester in order to illicit a certain response as part of the launch of Coindesk TV. Nouriel can be a filthy animal and make 'cocaine addict' jibes all day long - it only reflects poorly on himself as someone who lacks a modicum of class. We're talking about the views of a gravy-train academic who has built nothing against those who have built innovative companies.



But what are you views of Tesla holding Bitcoin for the general utility of BTC and it becoming more mainstream? Do you recognise it is strange that a corporation is buying it? 

My stance (before judgement), it has been good for the speculators as the announcement gave a good bump in value. I am struggling to understand the logic for Tesla to hold it, it doesn't do anything for their business model and appears more like a speculative investment which raises questions on their corporate governance. I am not sure what triggered Tesla to buy it, but it is clear that BTC is now being treated more and more as an investment rather than a currency. As a shareholder in Tesla I am less than impressed.


----------



## tecate

Moving on from Nouriel's Fossetts gig, we've had an announcement this morning from America's oldest bank ( Bank of New York Mellon ) - stating that it will hold and transfer bitcoin and other cryptocurrencies on behalf of its asset-management clients. From the WSJ: _"In time, BNY Mellon will allow those digital assets to pass through the same plumbing used by managers’ other, more traditional holdings—from Treasurys to technology stocks—using a platform that is now in prototype. The bank is already discussing plans with clients to bring their digital currencies into the fold."_


----------



## DublinHead54

tecate said:


> Moving on from Nouriel's Fossetts gig, we've had an announcement this morning from America's oldest bank ( Bank of New York Mellon ) - stating that it will hold and transfer bitcoin and other cryptocurrencies on behalf of its asset-management clients. From the WSJ: _"In time, BNY Mellon will allow those digital assets to pass through the same plumbing used by managers’ other, more traditional holdings—from Treasurys to technology stocks—using a platform that is now in prototype. The bank is already discussing plans with clients to bring their digital currencies into the fold."_



vultures.....


----------



## Duke of Marmalade

As a separate point Roubini refers to a world which has no cash and all money is digital central bank money.  That is very interesting for now there can genuinely be negative interest rates of whatever size.  What puts a maximum negative rate  today is the existence of physical money.  For banks and large institutions there is a cost to holding large sums of physical money (custody and security) so that the central bank can make interest rates negative but only up to a point.  For retail investors, at least up to say €1m, money under the mattress is a much more viable option and so I don't see deposit rates for small retail players going negative.  
But if there is no such thing as physical cash then interest rates can be set at anything by the central bank.  We would be freed from the liquidity trap.  Negative rates really would be an encouragement for people to go out and spend rather than see their current account with the central bank dwindling.  Would negative rates force them into gold, say?  Yes maybe but only a bit more than zero rates currently cause that to happen.


----------



## Conan

During the Tulip mania, at least one has some bulbs!


----------



## tecate

@Duke: Are you suggesting negative interest rates are a societal good? Robbing people's wealth is not something I'm down with. 
@Conan: Been done to death. Not a reasonable comparison. Of the recognised characteristics of a store of value and those of money, bitcoin scores well. You can't say that of tulips.


----------



## Duke of Marmalade

tecate said:


> @Duke: Are you suggesting negative interest rates are a societal good? Robbing people's wealth is not something I'm down with.


You're probably a young sort and don't remember the '80s when inflation was 15% and after tax deposit rates were maybe 4%.  Depositors never had it so good as today. 
But yes I think the facility to charge negative interest rates would make monetary policy more effective and that would facilitate the central bank's role in managing monetary policy in the interests of society.
I note that the bitcoin community seem to have given up on the medium of exchange motif and are pinning everything on the "digital gold" aspect.  If it is gold you want surely the real thing is far better than some virtual digital replacement.  Can you imagine digital cornflakes?


----------



## Younginvestor93

Duke of Marmalade said:


> You're probably a young sort and don't remember the '80s when inflation was 15% and after tax deposit rates were maybe 4%.  Depositors never had it so good as today.
> But yes I think the facility to charge negative interest rates would make monetary policy more effective and that would facilitate the central bank's role in managing monetary policy in the interests of society.
> I note that the bitcoin community seem to have given up on the medium of exchange motif and are pinning everything on the "digital gold" aspect.  If it is gold you want surely the real thing is far better than some virtual digital replacement.  Can you imagine digital cornflakes?


The return has been insane so far. Take a risk, it's going over 100k. Get in, take your profits as you go and play with the houses money. Best performing asset class the last 10 years by a mile.


----------



## Duke of Marmalade

Younginvestor93 said:


> Best performing asset class the last 10 years by a mile.


Not at all,  Willie Mullins had a 5,000/1 five timer last Sunday.  5,000/1 in one day!  As much entitlement to be called an asset class as a digital entry signifying nothing.


----------



## Nermal

Duke of Marmalade said:


> I note that the bitcoin community seem to have given up on the medium of exchange motif and are pinning everything on the "digital gold" aspect.



Not really. The SOV use-case was anticipated early on. 

When values were small and fees low, payments was an easy to understand use-case that everyone could focus on. That didn't last.

Have a look at the Lightning Network. SOV and payments are not mutually exclusive.

Gresham's Law may dictate that SOV 'wins', but it's too early to tell.


----------



## Duke of Marmalade

Nermal said:


> Have a look at the Lightning Network. SOV and payments are not mutually exclusive.


Absolutely!!  They are inseparable in the case of a currency.
John Kelleher (Investopedia and big fan of btc) puts it as follows.  Bitcoin can only possibly have a utility as a medium of exchange and all else will stand or fall on the extent to which it achieves that.  He himself thinks it will capture 15% of global medium of excchange utility, justifying a price of $500k.
The other way round, that a medium of exchange should at least be a short term SOV, is orthodox monetary theory.


----------



## WolfeTone

I'm a bit worried about the Roubini chap now after listening to that interview. He more or less says the exact same thing he has been saying for years. Its becoming a bit of a broken record. Does he not listen to himself?

Tether.
A favourite pet hate of his. He promised sometime back that an investigation into this would expose the Ponzi scheme underlying it. In this interview he admits he doesn't know if Tether is backed 70% by dollars or not, but concludes it must be a scam.
What it has to do with bitcoin anymore, does anyone know? 

Central Bank Digital Currency
Apparently, according to Roubini, CBDC will dominate and crowd-out crypto because, it will be centralised, private, permissioned and, wait for it - backed by trusted authority  
Seriously, has the man been listening to anything about bitcoin for the last decade? 
He is basically outlined the reasons why bitcoin was invented in the first place! And thinks the same reasons will be the reasons why bitcoin will be 'crowded out' by currency that is the exact opposite of bitcoin. 

And now we are entering the narrative of negative interest rates being a good thing! 
As Roubini points out, CBs cannot go negative more than -0.75% because there would be a flood of demand for paper currency with depositors not wanting to pay the negative interest rate tax. 
But in a cashless society, with CB digital currency, interest rates can go negative - 1, - 2, - 3, - 4, - 5%! 
Is this the USP for CBDC.... seriously? Try save a deposit for a house with negative interest rates while house prices are climbing! 
If this is the mindset of renowned economists and it is being lauded by anyone then we really have crossed the roubicon. This is pure spoofery. 

Get out now while you can.


----------



## Younginvestor93

Duke of Marmalade said:


> Not at all,  Willie Mullins had a 5,000/1 five timer last Sunday.  5,000/1 in one day!  As much entitlement to be called an asset class as a digital entry signifying nothing.


I don't think anyone knows how it will exactly play out but its worth a small percentage of your portfolio imo. Anyone who invested the past 10 years has done extremely well.


----------



## Duke of Marmalade

Younginvestor93 said:


> I don't think anyone knows how it will exactly play out but its worth a small percentage of your portfolio imo. Anyone who invested the past 10 years has done extremely well.


There have been thousands of cryptos.  Betting them all would be like betting a myriad of racehorse combinations.  Yes a few have been spectacular winners.  Most have bit the dirt.


----------



## Younginvestor93

Duke of Marmalade said:


> There have been thousands of cryptos.  Betting them all would be like betting a myriad of racehorse combinations.  Yes a few have been spectacular winners.  Most have bit the dirt.


You clearly have not invested then. It's funny how people who invest are blind and don't care about it's flaws and just want it go up and almost try to cling onto any argument supporting it and encourage anyone else to buy, buy, buy. On the other side those who haven't invested are desperate for it to fail, probably some jealousy there that others have made bank off it.


----------



## WolfeTone

Duke of Marmalade said:


> Yes a few have been spectacular winners



Care to elaborate? 



Younginvestor93 said:


> It's funny how people who invest are blind and don't care about it's flaws and just want it go up and almost try to cling onto any argument supporting it and encourage anyone else to buy, buy, buy.



Care to elaborate on the flaws of bitcoin? 
I don't buy bitcoin in the hope that it will go up. I buy bitcoin because I believe it will retain, at a minimum, the purchasing power of my euro over the foreseeable future. 
My argument for that is the continued and no-end-in-sight of fiat currency debasement by 'trusted' central banks.


----------



## Younginvestor93

WolfeTone said:


> Care to elaborate?
> 
> 
> 
> Care to elaborate on the flaws of bitcoin?
> I don't buy bitcoin in the hope that it will go up. I buy bitcoin because I believe it will retain, at a minimum, the purchasing power of my euro over the foreseeable future.
> My argument for that is the continued and no-end-in-sight of fiat currency debasement by 'trusted' central banks.


I don't know a lot about bitcoin but I know there are some good points to it and some flaws or inefficiencies with it, like anything. I should have said in my previous post many who invest are blind, a lot who promote it are of course encouraging everyone to buy it so the price then continues to go up. That's a fair reason for buying, I think it will easily go up past 50k, how far I don't know.


----------



## Duke of Marmalade

WolfeTone said:


> I don't buy bitcoin in the hope that it will go up. I buy bitcoin because I believe it will retain, at a minimum, the purchasing power of my euro over the foreseeable future.


So you don't buy because it will be an efficient medium of exchange for you, which was its primary purpose.


----------



## WolfeTone

Duke of Marmalade said:


> So you don't buy because it will be an efficient medium of exchange for you, which was its primary purpose.



I know it _is _not an efficient medium of exchange, today. I expect it _will_ be more than efficient at some point.
I think anyone would be nuts to use bitcoin to buy anything today, unless it was absolutely necessary.

$2trillion Investment Bank reveals bitcoin and crypto plans


----------



## DublinHead54

I have to laugh at BNY Mellon jumping on Bitcoin bandwagon, classic bank coming late to the party. 

In reality the only thing that has changed in the last 12 months is the price increase. That's what's driving BNY on the back of their clients probably calling them up. It's nothing to do with them believing in the technology, they are just trying to make a buck in an industry that is struggling to meet its ROE targets.


----------



## DublinHead54

P.S Bitcoin is not decentralised.


----------



## WolfeTone

Dublinbay12 said:


> P.S Bitcoin is not decentralised.



No? Thats new on me. Care to elaborate?


----------



## tecate

Duke of Marmalade said:


> Depositors never had it so good as today.


Sure - promote a system where people get robbed by stealth every year.


Duke of Marmalade said:


> Not at all,  Willie Mullins had a 5,000/1 five timer last Sunday.  5,000/1 in one day!  As much entitlement to be called an asset class as a digital entry signifying nothing.


Another day, another nonsensical analogy. What characteristics of a store of value or money does one of Willie's nags possess?


Duke of Marmalade said:


> But yes I think the facility to charge negative interest rates would make monetary policy more effective and that would facilitate the central bank's role in managing monetary policy in the interests of society.


For who's benefit?  You're propping up an inequitable system - and it's that system that has only been around over the past 50 years that is the great experiment - not bitcoin. Note that CBDCs will be used for social manipulation like never before.  A government can simply seize your 'money' at the touch of a button. They can give you a time limit as to how long you have to use it (encouraging responsible fiscal behaviour...NOT). They can penalise you depending upon what you spend your money on. That is the world of CBDCs that awaits.



Duke of Marmalade said:


> I note that the bitcoin community seem to have given up on the medium of exchange motif and are pinning everything on the "digital gold" aspect.


I think you are at this stage familiar with how the project has developed thus far. That doesn't negate its ability to innovate further. Bitcoin remains a legitimate and superior settlement layer for large transactions. Nothing stands in its way in that regard. The cup of coffee purchase (micro-transactions) is a different animal. The mistake (or more likely convenient assumption) that naysayers like yourself run with is that it doesn't fit that purpose today, therefore I won't listen to the notion of it (or associated projects) being developed to accommodate that purpose.


Duke of Marmalade said:


> If it is gold you want surely the real thing is far better than some virtual digital replacement.  Can you imagine digital cornflakes?


And disregard the superior characteristics of bitcoin vs. gold? Why would I do that?  Is gold divisible...because bitcoin is.  Can gold be safely transported across borders without risk of confiscation - because bitcoin can. In reality, how easy is it to transport and store gold? Are there costs associated with it? The vast majority of gold is stored centrally - meaning that the entire market can be and is manipulated. Billions of dollars worth of fake gold were found in vaults last year alone - yet bitcoin cant be counterfeited. Digital cornflakes indeed.


Nermal said:


> SOV and payments are not mutually exclusive.


Absolutely. And the story of the development of each of them remains unfinished business yet there's a mob here that wants to dismiss any notion of further progression/innovation. To me, it seems reasonable that as the pool of people that hold bitcoin increases they will from time to time use that facility to exchange value. Particularly so - if UX/design makes that option more user friendly. Gold has never had that option.


Duke of Marmalade said:


> The other way round, that a medium of exchange should at least be a short term SOV, is orthodox monetary theory.


You're trying to contrive something here to meet your narrative. There is nothing within the laws of physics that dictates that bitcoin has to develop as a medium of exchange first.


WolfeTone said:


> I'm a bit worried about the Roubini chap now after listening to that interview. He more or less says the exact same thing he has been saying for years. Its becoming a bit of a broken record. Does he not listen to himself?


His credibility is shot. Where has he ever recognised one positive facet of decentralised blockchain? Turkeys don't vote for Christmas and the monetary implications of bitcoin challenge the status quo as it exists for him and his central banking buddies. Having been wrong since bitcoin was at $13, he keeps doubling and tripling down and it keeps getting worse for him.


Younginvestor93 said:


> I don't think anyone knows how it will exactly play out but its worth a small percentage of your portfolio imo. Anyone who invested the past 10 years has done extremely well.


An allocation of no more than a couple of percent would provide exposure to an asset with significant upside potential (representing an assymetric risk) whilst limiting portfolio downside risk. That was my suggestion here a couple of years ago already.


Duke of Marmalade said:


> There have been thousands of cryptos.  Betting them all would be like betting a myriad of racehorse combinations.  Yes a few have been spectacular winners.  Most have bit the dirt.


There have been (and continue to be) thousands of startups outside of crypto. Most of them have failed or will fail. There were thousands of tech startups back in the dot com. I've no doubt that some gambled but what if someone spent the time on it and identified Google/Amazon/Facebook, etc. as winners at a very early stage?



WolfeTone said:


> My argument for that is the continued and no-end-in-sight of fiat currency debasement by 'trusted' central banks.


Indeed. I don't see much depth to that discussion on AAM. The case is often made that its not so much bitcoin price going up as euro/usd going down the toilet.


Duke of Marmalade said:


> So you don't buy because it will be an efficient medium of exchange for you, which was its primary purpose.


 As was pointed out to you, store of value was identified as a feature at an early stage. Even if what you claim was true, so what? Time and time again, new tech gets used for various purposes.


WolfeTone said:


> I know it _is _not an efficient medium of exchange, today. I expect it _will_ be more than efficient at some point.


I agree with you Wolfie that it's likely that a means will be found to provide for improved user experience when it comes to micro transactions as we move forward. Internet had scaling issues that took quite a while to overcome. Why should this be any different.
In the meantime, when it comes to large transactions and the use of bitcoin as a payments settlement layer, the Bitcoin network is already far superior.


----------



## DublinHead54

WolfeTone said:


> No? Thats new on me. Care to elaborate?



Really? Roughly 65% of the hash power is concentrated in China, so the operation of the network is very concentrated in China. In addition those miners aren't doing it for the greater good they are doing it to get monetary benefit. 

As a concept of design the creation of bitcoin is decentralised but in reality it isn't really decentralised. I think it's quite irrelevant anyway as the usage of bitcoin isn't really driven by the fact it's 'decentralised'. 

Who do you trust more? The government printing your euros or a Chinese corporation?


----------



## tecate

WolfeTone said:


> No? Thats new on me. Care to elaborate?


Take no notice, Wolfie - it's just more scaremongering. There is no economic incentive for such actors to attack the very network that feeds them. It would cost billions to attack the network in that way. There is no economic incentive for miners to act in that way - quite the opposite. This is the sort of fear, uncertainty and doubt that the likes of Roubini (or anyone who is diametrically opposed to decentralised crypto) comes out with.


----------



## DublinHead54

tecate said:


> Take no notice, Wolfie - it's just more scaremongering. There is no economic incentive for such actors to attack the very network that feeds them. It would cost billions to attack the network in that way. There is no economic incentive for miners to act in that way - quite the opposite. This is the sort of fear, uncertainty and doubt that the likes of Roubini (or anyone who is diametrically opposed to decentralised crypto) comes out with.



It isn't scaremongering, it is a fact. Bitcoin is decentralized in the context of it not being created by central bank / government, but it is not decentralized in its operation (miners) or in its distribution (small minority hold the majority). In my latter point BTC does suffer from the same issue as regular economics in the fact that 1% own 90%+ of the wealth. I was not attacking Bitcoin, and I agree the economic incentive for the miners is a high BTC price but that is neither here nor there in disproving that BTC is infact not decentralized. Can you agree that there is a concentration and reliance on China?

Personally, I find it ironic that the argument for BTC is for the democratization of finance through decentralization and taking the control away Central Banks and Governments that can't be trusted. However, for the BTC network to operate it relies on trusting a small pool of miners and the chinese government. Do we really trust the Chinese Government more than say the EU, I certainly don't? 

The idea of BTC and its technical innovations is impressive and standalone in a perfect world make perfect sense. However, we don't live in a perfect world and BTC has to try and operate within the social political constructs that exist in the world. For example, we talk on here about the efficiency of BTC as a payment method, it'll never be efficient as long as the countries we live in treat the use of BTC in purchasing goods as a taxable event (e.g Paypal in the US). That is a real example of in the purity of BTC it should work but in the real world it has been stopped in its tracks. This is why I can't see BTC every being used as a currency, and why it is now essentially being treated as a store of value and investment. 

The next efficiency issue is the environmental impact, do I want to support a currency that damages the environment more than the Euros in my pocket? Do I really value trust and decentralization over the environment? I did in 2012 in the early days but now I am not so sure, and I am not sure the majority do either. 

Lastly, on CBDCs this is Central Banks responded to Crypto to protect its interests. It is quite complex and needs to broken into Retail and Institutional. I wrote a research paper in 2019/20 on the topic and the general opinion from CBs is that there are benefits but many challenges and it requires a lot more research. You have to remember physical currency only represents ~10% of currency in circulation and in the last five years the use of cash is diminishing, so you can essentially say the euro is already digital. The real benefits will be on the institutional / infrastructure side in gaining efficiencies on the trillions of euros that circulate in the financial markets daily. 

*Caveat, I have held BTC in some form or other since 2011. I am expecting to just be called a scaremongering, but that is fine. Nothing that I have said is untrue as of 2021. I am sure there are various initiatives that Tecate will point to that will solve that, and I'll not disagree with those, except that I generally have been let down by the promises in BTC developments over the years. It tends to take much longer to achieve goals than predicted.


----------



## DublinHead54

A question for you @tecate @WolfeTone there is a piece of the puzzle I don't understand with the latest shift in the last 18 months.

There is a limited supply and in the last year more people are announcing large holdings (Tesla, MicroStrategy etc), so an increased population of coins are being held and not moving around thus reducing the circulating supply. 

The miners get rewarded with BTC for validating transactions, so what happens to the network if a large portion of the coins are just being held and not circulating, How does the network sustain itself?  Would it need to create artificial transactions? By that a mean lets say exchanges just keep moving around the same 1 million coins between their wallets.


----------



## tecate

*Chinese Miners Do Not Provide a Credible Threat to Bitcoin's Decentralised Peer to Peer Network*
There is no realistic and credible threat to the bitcoin network from any Chinese entity - be that a corporation or the Chinese government. On mining pools, participants can move from one mining pool to another dynamically - they're not locked in. If the controller of a mining pool worked against their interest they wouldn't be long in doing that.
If it cost X billion to carry out an attack on the network and the potential upside was much less than the cost of the attack, what participant in a mining pool is going to be down with that?

On the government threat - firstly, they would need a motivation. Who would they be attacking in going to all that effort? But for all intents and purposes, lets assume that the Chinese government have one. Mining farms are cast all over China - often in remote inaccessible locations. The Chinese can't move against these miners without letting the cat out of the bag that something is afoot. Counter measures would be taken. The attack would fail. At worst it would cause temporary network disruption. As with all other attacks, such an eventuality would only serve to make the network stronger in the longer term.

Would greater geographical distribution of mining facilities be optimal? Sure. Notwithstanding that, any reasonable appraisal of the current threat potential that I've come across doesn't suggest that such an eventuality would destroy bitcoin. Beyond that, I do see greater distribution of such facilities in other regions as we move forward. We've already seen increased growth in that regard in regions such as North America. Of course for the Roubini's of this world that have a hatred for bitcoin, such individuals will latch on to any old rubbish without even handed assessment simply because its useful to them in casting fear, uncertainty and doubt.

*Bitcoin Distribution was Equitable*
With regard to economic distribution of bitcoin, Satoshi couldn't possibly have designed distribution more equitably. Bitcoin was available for free to anyone who wanted it at the very beginning. It was available for next to nothing for the first number of years. Anyone with the foresight to recognise the societal good that it represents are well entitled to whatever dividend has come with that. Over and above that, bitcoin is available today to anyone that wants it. Over the course of 3-4 years of debate here on AAM, it has been available at low cost to anyone who felt they had missed out. It's available to them today at a higher cost. It will be available to them in the not too distant at a higher cost still.
There are an ever growing number of actively used wallet addresses - that metric has grown year on year over the course of this long running debate. That's indicative of growing network effect and adoption.

*Regulation Continues to Evolve*
Taxation policy is but one aspect in all of this. As the userbase for the cryptocurrency continues to grow, sane and reasonable tax policy will have to follow. Of course governments can be unreasonable - but they're going to have to be careful or that will blow up in their faces. Furthermore, we're talking about a digital asset that has given itself license anywhere on the planet. Tax policies and regulation vary. India banned crypto a couple of years ago only to do a u-turn. Now it looks like they're going to implement a ban again. Lets see how that goes for them! Meanwhile, in the US long term bitcoin proponent senator Cynthia Lummis ( a former state treasurer) has just joined the banking committee. She joins quite a number of bitcoin-enlightened house representatives. I would expect that such tax treatment will be addressed in due course. Even if its not, it's not the greater issue with regard to the use of bitcoin as a means of exchange. Scalability and usability are. Both of those aspects are being worked on in one way or another. People often expect instant results but my understanding is that this is not how development works. It's slow, and iterative.

*Bitcoin's Energy Usage has Purpose*
The recent uptick in price has brought renewed focus on Bitcoin. With that, all the usual dated arguments are being rolled out once again. One of those is the energy requirement of bitcoin's proof of work consensus mechanism. Firstly, for anyone who has no appreciation of the societal good that bitcoin offers, they're never going to have a positive view towards bitcoin's energy usage. The reality is that conventional banking uses a hell of a lot more energy. Secondly, bitcoin is the energy buyer of last resort. The mining industry is driving innovative approaches in that respect. As this progresses, more and more renewable power is being used for this purpose. That level currently stands at 70%. Miners don't compete with any other users for power - as if they did then it wouldn't be cheap enough and they'd simply be uncompetitive. Far and away more energy is wasted every day of the week than is needed to power the bitcoin network. Flared off gas is now being used for bitcoin mining. Stranded renewable power is being utilised. In power plants throughout the world, an incredible amount of energy is simply wasted. Bitcoin mining now provides a use case for that wastage.
Bitcoin's proof of work based consensus mechanism provides for the most robust network on the planet. If after many years of real world road testing another model proves itself, I'm sure bitcoin developers would consider adopting it. However, any such changes to the bitcoin protocol are insanely (and deliberately) slow in their implementation (and arrived at by consensus). Notwithstanding that, the bottom line is that the energy usage is accounted for by stakeholders and it serves a purpose. So long as someone on here or elsewhere maintains that bitcoin offers nothing, then of course that argument will be perpetual - but so be it.

*Bitcoin Transaction Fees & Sustainability*
Mining is currently profitable - or else miners simply wouldn't have an economic incentive to carry out that activity. Block rewards will be phased out by 2140. From that point, miners will rely exclusively upon transaction fees. Therefore, the current year on year increase in network effect and adoption will need to continue to ensure that mining is sustainable. Aspersions have been cast as to sustainability re. transaction fees as the block reward reduces. Whilst changes made to the bitcoin protocol are insanely and deliberately slow and conservative, there is ongoing development taking place with tweaks and improvements applied. Looking that far ahead, its difficult to figure out whether there is an issue to be tackled here or not. However, over the coming years, there is no concern in this regard.


----------



## DublinHead54

tecate said:


> Chinese Miners Do Not Provide a Credible Threat to Bitcoin's Decentralised Peer to Peer Network
> There is no realistic and credible threat to the bitcoin network from any Chinese entity - be that a corporation or the Chinese government. On mining pools, participants can move from one mining pool to another dynamically - they're not locked in. If the controller of a mining pool worked against their interest they wouldn't be long in doing that.
> If it cost X billion to carry out an attack on the network and the potential upside was much less than the cost of the attack, what participant in a mining pool is going to be down with that?
> 
> On the government threat - firstly, they would need a motivation. Who would they be attacking in going to all that effort? But for all intents and purposes, lets assume that the Chinese government have one. Mining farms are cast all over China - often in remote inaccessible locations. The Chinese can't move against these miners without letting the cat out of the bag that something is afoot. Counter measures would be taken. The attack would fail. At worst it would cause temporary network disruption. As with all other attacks, such an eventuality would only serve to make the network stronger in the longer term.
> 
> Would greater geographical distribution of mining facilities be optimal? Sure. Notwithstanding that, any reasonable appraisal of the current threat potential that I've come across doesn't suggest that such an eventuality would destroy bitcoin. Beyond that, I do see greater distribution of such facilities in other regions as we move forward. We've already seen increased growth in that regard in regions such as North America. Of course for the Roubini's of this world that have a hatred for bitcoin, such individuals will latch on to any old rubbish without even handed assessment simply because its useful to them in casting fear, uncertainty and doubt.
> 
> Bitcoin Distribution was Equitable
> With regard to economic distribution of bitcoin, Satoshi couldn't possibly have designed distribution more equitably. Bitcoin was available for free to anyone who wanted it at the very beginning. It was available for next to nothing for the first number of years. Anyone with the foresight to recognise the societal good that it represents are well entitled to whatever dividend has come with that. Over and above that, bitcoin is available today to anyone that wants it. Over the course of 3-4 years of debate here on AAM, it has been available at low cost to anyone who felt they had missed out. It's available to them today at a higher cost. It will be available to them in the not too distant at a higher cost still.
> There are an ever growing number of actively used wallet addresses - that metric has grown year on year over the course of this long running debate. That's indicative of growing network effect and adoption.
> 
> Regulation Continues to Evolve
> Taxation policy is but one aspect in all of this. As the userbase for the cryptocurrency continues to grow, sane and reasonable tax policy will have to follow. Of course governments can be unreasonable - but they're going to have to be careful or that will blow up in their faces. Furthermore, we're talking about a digital asset that has given itself license anywhere on the planet. Tax policies and regulation vary. India banned crypto a couple of years ago only to do a u-turn. Now it looks like they're going to implement a ban again. Lets see how that goes for them! Meanwhile, in the US long term bitcoin proponent senator Cynthia Lummis ( a former state treasurer) has just joined the banking committee. She joins quite a number of bitcoin-enlightened house representatives. I would expect that such tax treatment will be addressed in due course. Even if its not, it's not the greater issue with regard to the use of bitcoin as a means of exchange. Scalability and usability are. Both of those aspects are being worked on in one way or another. People often expect instant results but my understanding is that this is not how development works. It's slow, and iterative.
> 
> Bitcoin's Energy Usage has Purpose
> The recent uptick in price has brought renewed focus on Bitcoin. With that, all the usual dated arguments are being rolled out once again. One of those is the energy requirement of bitcoin's proof of work consensus mechanism. Firstly, for anyone who has no appreciation of the societal good that bitcoin offers, they're never going to have a positive view towards bitcoin's energy usage. The reality is that conventional banking uses a hell of a lot more energy. Secondly, bitcoin is the energy buyer of last resort. The mining industry is driving innovative approaches in that respect. As this progresses, more and more renewable power is being used for this purpose. That level currently stands at 70%. Miners don't compete with any other users for power - as if they did then it wouldn't be cheap enough and they'd simply be uncompetitive. Far and away more energy is wasted every day of the week than is needed to power the bitcoin network. Flared off gas is now being used for bitcoin mining. Stranded renewable power is being utilised. In power plants throughout the world, an incredible amount of energy is simply wasted. Bitcoin mining now provides a use case for that wastage.
> Bitcoin's proof of work based consensus mechanism provides for the most robust network on the planet. If after many years of real world road testing another model proves itself, I'm sure bitcoin developers would consider adopting it. However, any such changes to the bitcoin protocol are insanely (and deliberately) slow in their implementation (and arrived at by consensus). Notwithstanding that, the bottom line is that the energy usage is accounted for by stakeholders and it serves a purpose. So long as someone on here or elsewhere maintains that bitcoin offers nothing, then of course that argument will be perpetual - but so be it.
> 
> Bitcoin Transaction Fees & Sustainability
> Mining is currently profitable - or else miners simply wouldn't have an economic incentive to carry out that activity. Block rewards will be phased out by 2140. From that point, miners will rely exclusively upon transaction fees. Therefore, the current year on year increase in network effect and adoption will need to continue to ensure that mining is sustainable. Aspersions have been cast as to sustainability re. transaction fees as the block reward reduces. Whilst changes made to the bitcoin protocol are insanely and deliberately slow and conservative, there is ongoing development taking place with tweaks and improvements applied. Looking that far ahead, its difficult to figure out whether there is an issue to be tackled here or not. However, over the coming years, there is no concern in this regard.



Thank you for agreeing with my points. 

I was not suggesting an attack is imminent or actually making any point about an attack. I was making a factual point that the Bitcoin Network as of today has a concentration in China, thus is not really decentralized, and any concentration increases the underlying risks. 

What in your view is the societal good of Bitcoin? I believe from previous conversations your view is BTC has evolved into it is now going to be used as a store of value rather than a currency, which I agree with. However, with this evolution I see a loss of the potential societal goods (banking the unbanked etc). So it is my opinion that the energy usage is a real concern in the context of it being used as a store of value. 

I think it is safe to say when Wall Street and the billionaires of the world get involved, the average joe starts to lose out.


----------



## tecate

Breaking ....

Apple Pay to support bitcoin payments.


******************

Anyone making a one sentence statement claiming bitcoin is centralised is being disingenuous. Bitcoin was designed and conceived as a decentralised network and that's precisely what it is today. If someone wants to talk about the degree of decentralisation, that's fine - but it is and has been decentralised. If anyone wants to participate as a miner, they can do so right now. If anyone wants to simply use the network to store or send value, they can do so - there won't be any centralised third party standing in their way.


----------



## WolfeTone

Dublinbay12 said:


> So it is my opinion that the energy usage is a real concern in the context of it being used as a store of value.



I have to say that the energy use was a red-flag to me for a long while. But here is a conversation between two bitcoin proponents, and from_ 25mins 30sec _on its energy use. Gives pause for thought imo, and touches on elements that tecate referred to.

Bitcoin energy use


----------



## DublinHead54

WolfeTone said:


> I have to say that the energy use was a red-flag to me for a long while. But here is a conversation between two bitcoin proponents, and from_ 25mins 30sec _on its energy use. Gives pause for thought imo, and touches on elements that tecate referred to.
> 
> Bitcoin energy use



Thanks, I agree it does without solving the problem. 

What I do have an issue with is tecates comments that traditional banking uses way more way more energy and thus bitcoins usage is ok. It's a naive stance.


----------



## WolfeTone

Dublinbay12 said:


> Thanks, I agree it does without solving the problem.



What is the problem, exactly? You haven't really outlined it, other than bitcoin uses energy?



Dublinbay12 said:


> The next efficiency issue is the environmental impact, do I want to support a currency that damages the environment more than the Euros in my pocket?



How does bitcoin damage the environment more than the Euros in your pocket?



Dublinbay12 said:


> So it is my opinion that the energy usage is a real concern in the context of it being used as a store of value



You need to elaborate. Using energy is not an issue, it never has been. It is what this planet survives and thrives on. Using energy sources that emit excessive amounts of greenhouse gases that are altering the planets ecosystem is what is of concern.


----------



## tecate

Someone can identify a world power as a potential attack vector where the Bitcoin network is concerned in one breath and in the next, attack the very mechanism that makes it the most robust payment network that has ever existed. Over the course of 12 years, the Bitcoin network has never been hacked. It has facilitated 100s of millions of transactions in that timeframe without one fraudulent transaction.
Mining provides network security. That comes with an energy requirement that is  currently  at a 70% renewable level and trending towards ever higher levels of renewable, wasted and stranded energy consumption.


----------



## DublinHead54

WolfeTone said:


> What is the problem, exactly? You haven't really outlined it, other than bitcoin uses energy?
> 
> 
> 
> How does bitcoin damage the environment more than the Euros in your pocket?
> 
> 
> 
> You need to elaborate. Using energy is not an issue, it never has been. It is what this planet survives and thrives on. Using energy sources that emit excessive amounts of greenhouse gases that are altering the planets ecosystem is what is of concern.



Why isn't that problem enough? Do you not think the current reliance on fossil fuels is an issue?

The video didn't actual discuss that specific issue with BTC. If the hypothesis presented were to hold true should we not see multiple plans to build BTC mining plants in remote areas to harness green energy? Where is the motivation for the mining pools to be more environmentally friendly. 

What I'm really focusing on here is the facts of how the network operates today and that is the concern. 

I'm not aware that the EU uses a fraction of the energy to print a euro that costs to mine one BTC. That again is logical given BTC is mined through solving algorithms and euros are printed via keystrokes. 

What I can point to is the concrete evidence of financial institutions / governments commiting to becoming carbon neutral. 

I find this topic very frustrating to discuss on this forum. As certain individuals like to categorize people either into bitcoin believers or bitcoin detractors. As soon as any criticism of bitcoin is voiced I am put in the detractor column. 

I actually find it ironic because if we hadn't had criticism of satoshis implementation in the community then we wouldn't have the bitcoin that we have today. 

With that said there are still flaws and risks. Those flaws and risks exist both internally and externally. I've been around the block a few times and the argument often lauded in this forum that bitcoin is better and therefore it should replace currency is just naive in the context of the real world. 

The best challenge I often out forward is just asking 'so what?'....for example Bitcoin is decentralised....so what?

I was very pro technology and bitcoin 10 years ago but with a little bit more experience I don't think we always need to turn to technology to solve problems. 

There is definitely a generational factor on this topic as well. Somebody earlier was arguing the case against central banks and governments by saying they are stealing money by paying negative rates. However, a lot of people are happy with that because it means their mortgage rates are 3% Vs 15% 30 years ago.


----------



## WolfeTone

Ok, there is a lot to pack in there so bear with me a little.



Dublinbay12 said:


> Why isn't that problem enough? Do you not think the current reliance on fossil fuels is an issue?



Of course it is an issue, as I mentioned it is has been a red-flag with me for a time.

However, I'm also minded that the extent that bitcoin relies on fossils fuels is nothing more than a mere drop in the ocean of the overall global reliance on fossil fuels.

It could be argued, why add to it? But equally then, why allow any innovation, or any new technology, add to demand and consumption of fossil fuels? Why allow so much energy wastage on NASA/Spacex projects that aim to do, what, exactly? Send humans to Mars on some pipe dream? What is wrong with the planet we live on? Oh yeah, its burning up...why? Well, in part because we guzzle up and burn massive amounts of fossil fuels experimenting with sending rockets into space!

We must have a different take on the video I posted? It is quite explicit about how bitcoin, by its very existence can be the driver for innovation for utilizing clean, renewable energy resources in the future.



Dublinbay12 said:


> What I can point to is the concrete evidence of financial institutions / governments commiting to becoming carbon neutral.



I don't think I could think of a worse combination of institutions to lead the way for tackling climate change. Yes, they are critically important, but they are laggers, behind the curve, and fundamentally inefficient.
One of the critical impacts of climate change will be the further impoverishment of the poorest regions of earth through drought, flooding and disease. I don't doubt the decision makers of the biggest financial and corporate institutions of the world empathize with the worlds poor as much as me or you, but I suspect, they occupy the positions they occupy for reasons other than their acute awareness of pending catastrophic environmental issues. That may be changing, but it is a slow-burner.

As for governments, depending at any given time who is charge is hardly a concrete approach to tackling climate change. The USA for instance, it committed to the Paris Accord under Obama, then Trump withdrew, now Biden has brought them back in - I don't know about you, but I'm having an early bet on Donald Trump Jnr making a run for the top job in four years. I haven't a clue of his views on climate change.



Dublinbay12 said:


> I'm not aware that the EU uses a fraction of the energy to print a euro that costs to mine one BTC. That again is logical given BTC is mined through solving algorithms and euros are printed via keystrokes.



This is an interesting point. Bitcoin uses a lot of energy, so in a world with climate change it has a challenge on its hands from the get-go to become more efficient and survive.
It is also said here, many, many times, is has no utility, it is not a medium of exchange, no value etc. A bit of a double-whammy by any measure? Energy inefficient and no utility.
To add to bitcoins woe's, it is supposed to compete with an established centralized, permissioned, infrastructurally sound, minimal energy absorbing keystroke form of money, by way of digital fiat.

Bitcoin should be history by now.

On the other hand.....

....while bitcoin mining uses a lot of energy and much is made of this, its energy usage is a drop in the ocean of total global energy usage. And outside of its energy consumption for mining, its energy usage is extremely limited having no apparent utility.

Fiat currency, however, is brought into existence by mere keystrokes and it does have utility, most certainly. Today, for instance, I drove my petrol car to the service station (polluting the environment on the way),  to fill up with more fossil fuels that I can burn at a later point. Fuels that probably came from some far flung country that burned more fossils to extract it out of the ground, refine it, and transport it on shipping vessels that burn more fossil fuels all for my personal convenience....why would so many people do so much damage to the environment for my convenience? Would it have anything to do with me having fiat currency, like the euro?
I would suggest it is exactly for that reason.

Bitcoin miners are like the poor farmer, or labourer, conscious of their limitations, acutely aware of scarcity, needing to economise and innovate, invoking entrepreneurial spirit to survive, compete and improve. This will include utilizing clean and renewable energy.

Fiat Central Bankers on the otherhand, are the archetype fat pigs gorging on the never-ending abundant supply of their own righteous obesity. Aloof to their direct contribution in destroying the environment for the last 50years or more. They are protected by subservient governments and their indoctrinated, pacified populations.

Its just a question of who survives, and who does not.


----------



## tecate

@Wolfie - a good find in that Michael Saylor - Ross Stevens interview. It formed part of Saylor's webinar for firms who are considering the possibility of holding bitcoin on their balance sheets - attracting over 1,000 attendees. Steven's NYDIG currently holds $6 billion worth of bitcoin for institutional clients.

With 70% of miners including renewables in the mix, bitcoin miners are not 'reliant' on fossil fuels.  In most cases, they're actually 'reliant' on unwanted wasted power and renewables. In most regions, fossil fuels are simply uncompetitive for bitcoin mining. Exceptions include places like Iran & Venezuela - where between economic mismanagement and sanctions, conditions are such that oil-based energy enters the mix. In normal conditions, bitcoin miners go bankrupt if they can't access cheap renewable energy at a minimum.

Just in case anyone doubts this relentless pursuit of the cheapest possible renewable power, multi-million dollar solar farms have been setup (with  more in the planning stage) in places like West Texas. Another project plans to utilise stranded solar on the edge of the Sahara. There are geo-thermal based setups in Iceland and hydro and wind based projects in operation in China, Canada, Upstate New York and  Washington state. None of these schemes compete with other energy buyers. With few exceptions, they're miles away from major population centres.

Another startup offers a service to the oil/gas industry - with custom built containers - setup with mining rigs which can be dropped onto a remote oil/gas field ready to go - and run off power derived from wasted flared gas. Power stations are getting in on the act directly - and either partnering with miners or running operations themselves given the volume of energy that's simply wasted at such facilities every day of the week.

Anyone who has ever taken an interest in renewables such as solar and wind knows that a major issue is lack of supply consistency. Guess how bitcoin mining can help to smooth that out? In the process, it's making such renewable projects feasible.

Anyone who suggests that pressing a key is the only energy expended in providing for an entire fiat based monetary system is telling fibs. If the calculations are genuine, the conventional system uses a hell of a lot more energy than bitcoin mining.

In terms of government policy re. carbon neutrality, bitcoin miners have bootstrapped themselves up to 70% renewables globally without any chat with officialdom. Governments are actually the cause of that figure not being higher (Venezuela/Iran). In this overall effort, miners are very much in a position to help in this effort by making renewable projects sustainable (see above) and making excellent use of energy that's otherwise wasted.

And now for consideration of where the real issue lies in terms of global warming and growing inequality.  This fiat money experiment in its current form is a basket case. It's geared to benefit/reward government negligence and mismanagement as they just inflate away their screw ups. The Roubini's of this world support a system where fiscally responsible citizens who work hard and save are screwed over - continually relieved of their wealth via stealth (inflation of the things that matter in life). The system is rigged to encourage indebtedness - to induce people to be the ultimate consumers. In this way, they're encouraged to buy all manner of crap they don't actually need and there's the culprit in terms of global warming.


----------



## DublinHead54

WolfeTone said:


> Ok, there is a lot to pack in there so bear with me a little.
> 
> 
> 
> Of course it is an issue, as I mentioned it is has been a red-flag with me for a time.
> 
> However, I'm also minded that the extent that bitcoin relies on fossils fuels is nothing more than a mere drop in the ocean of the overall global reliance on fossil fuels.
> 
> It could be argued, why add to it?



So you've a concern but your attitude is it's not important because everyone else uses fossil fuels.

Sorry wolf tone but that is exactly the wrong attitude.

I don't even no where to begin on the premise that bitcoin is also now going to be a catalyst for clean energy in the future.


----------



## DublinHead54

I hate to use the following term but it really astounds me the narrow mindedness of the staunchest Bitcoin proponents on this forum.

It is completely the wrong type of people we want in the community.

The fact that in every response above there is a refusal to accept the world existing without bitcoin can change for the better. Banks, governments or whoever can't change or shouldn't be permitted to change. Yet any criticism of bitcoin is met with 'oh but BTC is changing and will address that'.

The energy consumption and concentration of BTC in China is a great example. The responses thus far have just shown an inability to accept there are issues.

The fact that you can't objectively appreciate that the world is changing not only in response to BTC but to many other factors means you've already lost. You can't solely look at BTC as the only solution. 

In fact BTC has evolved itself, the use case for it now has nothing to do with the original purpose. 

I'm sure you can rationalise how the big bad banks holding BTC now is actually a good thing under the banner of 'greater adoption'.


----------



## WolfeTone

Dublinbay12 said:


> So you've a concern but your attitude is it's not important because everyone else uses fossil fuels



No not at all, quite the opposite. It's the fake concern of others with regard to use of fossil fuels for bitcoin and not much else. 

There is an easy answer to this, governments can ban the use of fossil fuels tomorrow, or impose draconian taxes and tariffs on their use. 
Everyone and everything, including bitcoin mining, can move to clean renewable energy sources or die.


----------



## DublinHead54

WolfeTone said:


> No not at all, quite the opposite. It's the fake concern of others with regard to use of fossil fuels for bitcoin and not much else.
> 
> There is an easy answer to this, governments can ban the use of fossil fuels tomorrow, or impose draconian taxes and tariffs on their use.
> Everyone and everything, including bitcoin mining, can move to clean renewable energy sources or die.



So it is a fake concern in regard to BTC? In a topic of BTC we can't raise the issue of energy usage as a concern because everyone else uses fossil fuels?

You are operating in an echo chamber. The Paris climate accords, the climate change marches over the last year's. They have had nothing to do with BTC. This is not a witch hunt against BTC, it is simply pointing out one of the major concerns with BTC at present. 

I am sure like other industries they will address it either through force or their own morality of those poor farmers. 

Or maybe mining can be begin to operate efficiently on the back of other energy generation projects. Although I'm not sure how those poor farmers would feel about giving away a slice of their cash cow.


----------



## WolfeTone

Dublinbay12 said:


> In a topic of BTC we can't raise the issue of energy usage as a concern because everyone else uses fossil fuels?



?? But the issue has been raised!

As I have mentioned before, it has been a concern of mine.

I have proposed a solution, ban the use of fossil uses for generating energy or impose draconian taxes and tariffs on them. 

What do you think?


----------



## DublinHead54

WolfeTone said:


> ?? But the issue has been raised!
> 
> As I have mentioned before, it has been a concern of mine.
> 
> I have proposed a solution, ban the use of fossil uses for generating energy or impose draconian taxes and tariffs on them.
> 
> What do you think?



Thank you for agreeing with my points regarding Bitcoin and energy usage. 

I agree with the work being accelerated under the Paris Climate accords on the global issue of fossil fuel usage. 

I'm not sure how your solution solves the issue of BTC as to yours and other posters BTC is decentralised and thus not mandated to adhere to global initiatives. Further another poster claimed the Chinese government / military can do nothing to stop BTC miners.


----------



## WolfeTone

Dublinbay12 said:


> I'm not sure how your solution solves the issue of BTC as to yours and other posters BTC is decentralised and thus not mandated to adhere to global initiatives.



Bitcoin miners don't mine fossil fuels.

So my solution is to make fossil fuels cost prohibitive by either making it illegal to source and use, and/or impose draconian taxes and tariffs on it.
That way, everyone and everything, including bitcoin miners, can move to using clean, renewable energy resources or die.
What do you think?

The Paris Climate accord, while a welcome step in the right direction, has already had its vulnerabilities exposed not least by the USAs withdrawal under Trump.
The PCA is a result of at least 50yrs, or more, of scientific knowledge identifying and warning of the consequences to the planets echo-system of excessive CO2 emissions into the environment.
Bitcoin is just over a decade old, its energy consumption becoming of some concern maybe 6,7 yrs ago?
Already, as @tecate highlights above, we see evidence of innovation to utilise wasted energy and clean renewables. That is because bitcoin miners need to economise to survive and thrive.
But if you can just keystroke a trillion $ here, and a trillion $ there into existence, to sustain consumption of goods and services already reliant of fossil fuel energy, what will be the impact on our environment?

Governments and financial institutions are laggers when it comes to addressing climate change. They are the fat pigs in the room that need the most effort to shift to do anything. It is why the Paris Climate Accord has taken so long to emerge.


----------



## tecate

WolfeTone said:


> Bitcoin miners don't mine fossil fuels.









Fossil fuels can be banned tomorrow and it won't make a blind bit of difference to a bitcoin mining sector that's constantly having to seek out unwanted energy in order to remain profitable. I wonder will that mean governments removing subsidies on coal mining and the application of the same standard to other sectors?


----------



## DublinHead54

WolfeTone said:


> Bitcoin miners don't mine fossil fuels.
> 
> So my solution is to make fossil fuels cost prohibitive by either making it illegal to source and use, and/or impose draconian taxes and tariffs on it.
> That way, everyone and everything, including bitcoin miners, can move to using clean, renewable energy resources or die.
> What do you think?
> 
> The Paris Climate accord, while a welcome step in the right direction, has already had its vulnerabilities exposed not least by the USAs withdrawal under Trump.
> The PCA is a result of at least 50yrs, or more, of scientific knowledge identifying and warning of the consequences to the planets echo-system of excessive CO2 emissions into the environment.
> Bitcoin is just over a decade old, its energy consumption becoming of some concern maybe 6,7 yrs ago?
> Already, as @tecate highlights above, we see evidence of innovation to utilise wasted energy and clean renewables. That is because bitcoin miners need to economise to survive and thrive.
> But if you can just keystroke a trillion $ here, and a trillion $ there into existence, to sustain consumption of goods and services already reliant of fossil fuel energy, what will be the impact on our environment?
> 
> Governments and financial institutions are laggers when it comes to addressing climate change. They are the fat pigs in the room that need the most effort to shift to do anything. It is why the Paris Climate Accord has taken so long to emerge.



You've ignored my point. In your solution which obviously would work, my question was why would BTC miners have to follow that ban? You've made the argument that  BTC is  decentralised and not controlled by any government, given it is governments that would instigate the ban, surely then the BTC network would not be impacted? 

 What has been posted has been novel solutions that have not yet moved into production. Again you present an attitude that any government / corporation cannot evolve and is the problem. 

Have you actually looked at the disagreements within the bitcoin industry that have stalled the evolution over the years?


----------



## tecate

Bitcoin mining doesn't need emissions regulation - by virtue of its design, it chases the cheapest energy conceivable on the planet and that energy is renewable and unwanted. Someone or other has suggested that examples of renewables use within bitcoin mining are 'novel'. That's incorrect. With in excess of 70% of bitcoin miners already utilising renewables - and more such projects in the pipeline. Yassine Elmandjra's tweet thread on the subject succinctly clarifies all of the above.


As to any suggestion that decentralisation doesn't work, there is only merit to that argument if every single government comes together and bans it. Good luck with that! China already ordered bitcoin miners out of the country some time ago - that worked well, didn't it.


----------



## WolfeTone

Dublinbay12 said:


> You've ignored my point. In your solution which obviously would work, my question was why would BTC miners have to follow that ban? You've made the argument that  BTC is  decentralised and not controlled by any government, given it is governments that would instigate the ban, surely then the BTC network would not be impacted?
> 
> What has been posted has been novel solutions that have not yet moved into production. Again you present an attitude that any government / corporation cannot evolve and is the problem.
> 
> Have you actually looked at the disagreements within the bitcoin industry that have stalled the evolution over the years?



I haven't ignored anything. I proposed a solution that would effectively shutdown the fossil fuel industry. You appear to agree?

If the fossil fuel industry is no longer operating, why would bitcoin miners try to continue source and use energy from fossil fuels? It would be cost prohibitive, instead they could just plug into the clean renewable energy sources that have replaced fossil fuel.

I have not argued that governments / corporations cannot change. I have argued that they are slow to change, evidenced by the existing scientific data that has for 50yrs or more identified and warned of the impact of global warming, culminating in the Paris Accord which is susceptible to implementation, depending on who is charge of government at any given time.


----------



## DublinHead54

WolfeTone said:


> I haven't ignored anything. I proposed a solution that would effectively shutdown the fossil fuel industry. You appear to agree?
> 
> If the fossil fuel industry is no longer operating, why would bitcoin miners try to continue source and use energy from fossil fuels? It would be cost prohibitive, instead they could just plug into the clean renewable energy sources that have replaced fossil fuel.
> 
> I have not argued that governments / corporations cannot change. I have argued that they are slow to change, evidenced by the existing scientific data that has for 50yrs or more identified and warned of the impact of global warming, culminating in the Paris Accord which is susceptible to implementation, depending on who is charge of government at any given time.



Why are you trying to change the topic? I've asked the same question twice and I'm trying to pull this conversation back to the specific topic of BTC.

Can you answer? Or there's no really any point continuing in this echo chamber.

My question was why would BTC miners have to follow that ban? You've made the argument that BTC is decentralised and not controlled by any government, given it is governments that would instigate the ban, surely then the BTC network would not be impacted?


----------



## WolfeTone

Dublinbay12 said:


> My question was why would BTC miners have to follow that ban?



Because it would be cost prohibitive not to follow the ban, put them out of business and ultimately make no economic sense to try continue relying on non-existent fossil fuel energy sources when there is cheaper alternative sources available. 

It's not really that hard to understand.


----------



## tecate

Unless there is 100% consensus of every nation state on the planet to ban bitcoin mining without exception, no existential threat exists to the bitcoin network. Nations have banned bitcoin. Some have changed their mind and then banned it again. They've done similar with bitcoin mining. And yet the bitcoin network is stronger than ever.


----------



## DublinHead54

WolfeTone said:


> Because it would be cost prohibitive not to follow the ban, put them out of business and ultimately make no economic sense to try continue relying on non-existent fossil fuel energy sources when there is cheaper alternative sources available.
> 
> It's not really that hard to understand.



So just for clarification you do agree that BTC can be controlled by a government per the example you provided and therefore agree it is not completely decentralised therefore?


----------



## tecate

@Wolfie: Say you're rolling out a network and your choices are to have just one point/location from which to run that network or you can spread that over a gazillion sites distributed over 195 countries.

The first option is easiest so you run with that. A week later, the government come and close it down. Your network is now done for, yer not a happy camper and you hit the drink for a week.

You pick yerself up a week later and decide to try again and run with option 2. You now have network points in 194 countries yet users from all 195 countries access your network.

You'd be well pleased with your decentralised network right?


----------



## WolfeTone

Dublinbay12 said:


> So just for clarification you do agree that BTC can be controlled by a government per the example you provided and therefore agree it is not completely decentralised therefore?



How would a decision by government to ban, or make cost prohibitive, the use of, or resourcing of, fossil fuels amount to BTC under control of a government and therefore meaning it is not 'completely decentralised'?

Am I missing something here? I acknowledge your aforementioned direct involvement in the crypto space but I find this line of thinking, bizarre, quite frankly.
To clarify, inherent in my example of government(s) banning the use of fossil fuels is the underlying assumption that it will happen when their is ample infrastructure to provide alternative clean, renewable energy to supply society, industry and commerce.


----------



## DublinHead54

WolfeTone said:


> How would a decision by government to ban, or make cost prohibitive, the use of, or resourcing of, fossil fuels amount to BTC under control of a government and therefore meaning it is not 'completely decentralised'?
> 
> Am I missing something here? I acknowledge your aforementioned direct involvement in the crypto space but I find this line of thinking, bizarre, quite frankly.
> To clarify, inherent in my example of government(s) banning the use of fossil fuels is the underlying assumption that it will happen when their is ample infrastructure to provide alternative clean, renewable energy to supply society, industry and commerce.



You haven't clarified your example, you just changed it. I'll give you the benefit of the doubt and accept that's what you originally meant when you said an immediate ban and resulting in either changing or dying. 

If you can't see that problem then I don't know what to say.


----------



## WolfeTone

Dublinbay12 said:


> If you can't see that problem then I don't know what to say.



No, I can't see that problem and I am fine if you don't know what to say.


----------



## WolfeTone

So on its official Twitter account the ECB posted this 'cryptic' ryhme for Valentines day. 

_"Roses are Red
Violets are Blue
We'll keep financing conditions favourable 
Until the crisis is through" _

So romantic. It looks like they have announced that they do indeed have a magic money tree, and are turned on about the prospect of possibly entering a hyperinflationery period.


----------



## tecate

It's far more romantic than 'money printer go brrrrr!'


----------



## tecate

Just in case anyone is still in doubt about the nature of bitcoin mining, here's a current example of that relentless pursuit of wasted, renewable energy:

'Massive 70 MW Bitcoin Mining Rig Shipped to Russia'

This is one of a number of operations which are exploiting the estimated 5GW of surplus hydropower produced in the remote Siberian region.

Additionally, here is a thoughtful piece on the misconceptions surrounding bitcoin's energy use.


----------



## Duke of Marmalade

vp of sales at Metaco in Sindo said:
			
		

> A target of $300,000 to $500,000 is credible and reasonable.


This figure seems to derive from applying the John Bowe technique to the value of the world's $10trn gold.  What has that got to do with it.  I suppose we should be thankful that he didn't use the world's real estate value of $228trn.  But then I suppose a prediction of btc of $10m might not seem credible.
I am familiar with the life assurance sector.  There are very strict regulations and guidance about how they describe the potential for their products.  The time has surely come when the consumer protection people at the central bank should move to stop the irresponsible hype around bitcoin.


----------



## tecate

Duke of Marmalade said:


> This figure seems to derive from applying the John Bowe technique to the value of the world's $10trn gold.  What has that got to do with it.  I suppose we should be thankful that he didn't use the world's real estate value of $228trn.  But then I suppose a prediction of btc of $10m might not seem credible.
> I am familiar with the life assurance sector.  There are very strict regulations and guidance about how they describe the potential for their products.  The time has surely come when the consumer protection people at the central bank should move to stop the irresponsible hype around bitcoin.


Correct me if I'm wrong Dukey, but this guy works for a digital assets SaaS / industry infrastructure company. Unless there's something we don't know, there's no indicator that Metaco benefit from bitcoin at 300k-500k anymore than if it was at $50-100k?. It would be different if it was a hedgefund. It would seem that this is simply his opinion.

However, you did refer to a Wall Street guy a couple of weeks back (Scott Minerd). It originally came to light that his fund (Guggenheim Partners) had filed paperwork with the SEC to gain the necessary permission for the fund to buy digital assets. When first interviewed on the subject, he said that, he expected bitcoin to eventually reach a price of $400,000. In the days leading up to their approval being granted to buy, he said that he expected no further upside for bitcoin in 2020 and that it would fall back below $20,000. Some days after approval, he was back on again (presumably having had orders filled), this time predicting a price of $600,000.

That guy is from the conventional Wall Street set - and that is what they do and have always done. There's no need for anyone to single out crypto for market manipulation and bad practice. It's pervasive across traditional finance. I remember watching an emotional Bill Ackman on CNBC last March - predicting the end of the world!


----------



## Duke of Marmalade

tecate said:


> Correct me if I'm wrong Dukey, but this guy works for a digital assets SaaS / industry infrastructure company. Unless there's something we don't know, there's no indicator that Metaco benefit from bitcoin at 300k-500k anymore than if it was at $50-100k?. It would be different if it was a hedgefund. It would seem that this is simply his opinion.


Maybe (maybe) this guy is indifferent to the prospects for btc.  But the person quoting him has a definite interest in hyping btc.


----------



## WolfeTone

Duke of Marmalade said:


> The time has surely come when the consumer protection people at the central bank should move to stop the irresponsible hype around bitcoin.



I assume you mean ECB? I can't imagine the Irish central bank making much in-roads in stopping bitcoin?

But then again, the ECB is hardly a model of responsibility in its own right, is it?

Whatever happened to their mandate to maintain a stable monetary system with an inflation target of around 2%?
Nowadays its "whatever it takes" - Draghi, or "we can never run out of money" - LaGarde.

The euro is finished. Great idea in theory, but in practice it's descended into a shambles.

Get out now while you can.


----------



## Duke of Marmalade

WolfeTone said:


> I assume you mean ECB? I can't imagine the Irish central bank making much in-roads in stopping bitcoin?
> 
> But then again, the ECB is hardly a model of responsibility in its own right, is it?
> 
> Whatever happened to their mandate to maintain a stable monetary system with an inflation target of around 2%?
> Nowadays its "whatever it takes" - Draghi, or "we can never run out of money" - LaGarde.
> 
> The euro is finished. Great idea in theory, but in practice it's descended into a shambles.
> 
> Get out now while you can.


I was talking about consumer protection.  Dangling prospects of a 10 fold return would be banned in any regulated activity.


----------



## WolfeTone

Im not familiar with the proponents of the aforementioned price predictions of $300-$600k, but on the flip side their is ample commentators touting a price of $0, or next to, also. Isn't this as equally irresponsible? 
If such commentators are short bitcoin isn't this effectively the same thing? Where do AAM Bitcoin price prediction games sit with all of this?


----------



## DublinHead54

tecate said:


> Just in case anyone is still in doubt about the nature of bitcoin mining, here's a current example of that relentless pursuit of wasted, renewable energy:
> 
> 'Massive 70 MW Bitcoin Mining Rig Shipped to Russia'
> 
> This is one of a number of operations which are exploiting the estimated 5GW of surplus hydropower produced in the remote Siberian region.
> 
> Additionally, here is a thoughtful piece on the misconceptions surrounding bitcoin's energy use.



I don't see the reference to '5GW of surplus' in the article, just that a rig was shipped? However, 5GW is small in terms of energy usage/surplus, as an example, 5GW/Hr is 0.0005% of Russia annual usage. Given that Bitcoins annual energy consumption is an estimated 45 Terra Watts, initiatives like this whilst offering potential are a drop in the ocean, and are not evidence that there should be no concern over BTCs energy usage. 

If the BTC Network could be operated entirely from 'surplus' energy from established energy sources do you think the Chinese miners would let go given the economic incentives they have? Regarding energy more general, I am unaware that science has yet to develop an energy source that has no wastage? 

I actually believe that all power systems have to run a surplus in order to protect the power network because no industrial power source can just be 'switched on' instantly as needed. 

The coindesk article offers some good insights but overall it lacked depth. I thought the argument that 88% of coins are already mined therefore energy consumption will be lower was weak. There was no analysis to show energy consumption as mining becomes infinitely harder, even a rough estimate given that 88% of coins have been mined in 10 years but the remaining 12% won't be mined for another ~20 years. Regardless of whether the energy source is renewable or not. 

I agree you can't compare BTC to Visa as the latter is much more established with greater volume. However, if the conversation on carbon footprints is to include the ancillary connections (reference to US military in the article) then the ancillary services of BTC need to be brought into the conversation.


----------



## Duke of Marmalade

I think the economics of the miners is central to how much they will spend on electricity.  So the massive price increases are the main driver.  When new bitcoin becomes a negligible part of the miners'revenue and they depend only on transaction fees, their revenue seems destined to collapse and so I agree that this will lead to a big reduction in hash power and thus electricity usage.
But the linking of the US military expenditure to the protection of Visa is silly.


----------



## EmmDee

I'm not going to get into the philisophical question of whether Bitcoin is real or a "tulip bubble" - I'm undecided. The infrastructure is definitely real and being used by the mainstream banking industry already.

I'm unconvinced on the "store of wealth" argument at this point. A highly volatile asset isn't a good store of wealth. If the price can vary significantly on the back of one news announcement, the potential for loss of wealth is a counter balance to the independence question. A reversal of that announcement could drop the value just as much. And that volatility has a similar impact to hyper-inflation. However, possibly over time that volatility evens out - at which time I'd be more swayed by the store of wealth question. That doesn't preclude the benefit of having some Bitcoin in an investment portfolio.

The energy question is not irrelevant. A single transaction on Bitcoin has the same eneergy usage as 32 or 33 thousand over the Visa infrastructure for example. However, if that is a concern for people, I believe the energy usage by devices left on standby globally exceeds Bitcoin. My point being, whether using renewables or other methods, Bitcoin energy usage while problematic isn't the killer criticism to my mind


----------



## DazedInPontoon

Duke of Marmalade said:


> When new bitcoin becomes a negligible part of the miners'revenue and they depend only on transaction fees, their revenue seems destined to collapse and so I agree that this will lead to a big reduction in hash power and thus electricity usage.


Back when the reward was 50 btc per block, people were predicting that by the time the reward had reduced by over 85% percent that this would have already happened, and yet here we are at 6.25 btc per block, and record high hashrate.

They made a very common error when predicting the future of bitcoin.


----------



## Duke of Marmalade

DazedInPontoon said:


> Back when the reward was 50 btc per block, people were predicting that by the time the reward had reduced by over 85% percent that this would have already happened, and yet here we are at 6.25 btc per block, and record high hashrate.


Yes, and the rewards are at a record high, which is not a coincidence.  I would doubt that even @tecate predicted a price of $47K back when the reward was 50.  With a halving every 4 years, in 20 years the rewards will be 0.2 btc per block.  I am not predicting anything in this space any more but there is a good chance that the main revenue of miners will come from transaction fees so that, in effect, the participants will be paying for the electricity costs unlike today where the the main source of miners' revenue is quite literally coming out of nothing.


----------



## DazedInPontoon

The average fees over the last 2000 blocks was around 1 btc per block, so tx fees could be a bigger factor than block reward even sooner than you say, but that's only one factor anyway. As you say the price per btc is another one. You also must account for how the bitcoin industry would react to mining power reaching a level low enough to threaten the system.

The participants are already paying for the electricity costs, just indirectly, because miners pay for their electricity by selling bitcoin to the participants.


----------



## Duke of Marmalade

DazedInPontoon said:


> The participants are already paying for the electricity costs, just indirectly, because miners pay for their electricity by selling bitcoin to the participants.


Well, there are those who believe it is digital gold, that "mining" an extra 6.25 bitcoins genuinely has created added cap.  The miners may well offload their coins as soon as they have them washed which may or may not be to existing participants but either way those who purchase them do not believe that they have incurred any costs.
But tx fees look and feel like a genuine cost so that will put manners on the amount spent on electricity.  Today the illusion persists that money can be created out of nothing if you just throw enough electricity at it.


----------



## DazedInPontoon

The requirement of energy (electricity) to create money is the solution to the problem of being able to create money out of nothing


----------



## Duke of Marmalade

DazedInPontoon said:


> The requirement of energy (electricity) to create money is the solution to the problem of being able to create money out of nothing


Don't understand but clearly greater minds than mine have given this a like, so it must make some sort of sense.


----------



## tecate

Duke of Marmalade said:


> Don't understand but clearly greater minds than mine have given this a like, so it must make some sort of sense.


BTC is the energy standard that Henry Ford first floated 100 years ago. LINK.

Your insecurities re. likes - I can't help you with, your Dukeness.


----------



## Duke of Marmalade

tecate said:


> BTC is the energy standard that Henry Ford first floated 100 years ago. LINK.
> 
> Your insecurities re. likes - I can't help you with, your Dukeness.


Thanks for the link, but my feeble intellect is still struggling with the original post.
As for the link what a typical load of plausible rubbish to hype bitcoin.
Of course the price and the cost of supply are heavily correlated.  That is how it was designed.  But the causality is all one way.  The price decides the amount of mining effort committed.  In the more normal situation the causality is two way.  The cost has a direct impact on supply and hence on price.  By design the supply of bitcoin is completely unaffected by either its price or its cost of mining.  If electricity prices were increased 10-fold in the morning, it would reduce the amount of mining committed and bring down the difficulty levels from their current ridiculous value of 21 trillion times what Satoshi thought would be adequate.
I would say the spinner of that piece knows all this but still dangles plausible but entirely erroneous causality effects in the cause of the hype. Just like telling us that total world gold is $10trn.  What has that got to do with the price of bananas or bitcoin?


----------



## tecate

@dukey - I'm not sure how you're struggling with Dazed in Pontoon's post then (the need for energy re. bitcoin being a solution to creating money out of nothing). You accept that this cost is significant. You dismiss Henry Ford's energy standard yet you can't possibly disregard that Ford's whole thesis was similar in principal i.e. the energy cost implicated would give such a currency value.
Otherwise, you've identified that if mining becomes unprofitable, then the bitcoin algo difficulty rate drops down - so the system works in that respect. 
As regards the relevance of consideration of gold's market cap, I would have thought it's worthwhile to keep it in mind if the belief is that bitcoin improves upon gold at this point and eats into that market cap.


----------



## Duke of Marmalade

tecate said:


> @dukey - I'm not sure how you're struggling with Dazed in Pontoon's post then (the need for energy re. bitcoin being a solution to creating money out of nothing). You accept that this cost is significant. You dismiss Henry Ford's energy standard yet you can't possibly disregard that Ford's whole thesis was similar in principal i.e. the energy cost implicated would give such a currency value.
> Otherwise, you've identified that if mining becomes unprofitable, then the bitcoin algo difficulty rate drops down - so the system works in that respect.
> As regards the relevance of consideration of gold's market cap, I would have thought it's worthwhile to keep it in mind if the belief is that bitcoin improves upon gold at this point and eats into that market cap.


I don't quite know what Henry's idea was but my guess is that it was centred on two aspects, first and foremost that energy has intrinsic value and secondly that it costs (money?) to produce. Air has intrinsic value but it costs nothing, so not a good candidate for money.  It would cost a lot to pulp used tyres and whilst the finished product would have some desirable qualities like divisibility and durability it would be useless as money as it has no intrinsic value.  The M Pesa is similar to Henry's idea and again the key feature is that mobile minutes have intrinsic value and cost to produce.
Bitcoin has no intrinsic value.  It's cost of supply is irrelevant to its price (though clearly not the other way round) and in fact will not only ultimately be irrelevant it will be non existent.


----------



## WolfeTone

Duke of Marmalade said:


> Don't understand but clearly greater minds than mine have given this a like, so it must make some sort of sense.



Ah, Duke, you do yourself a disservice.

I put the Professor Fergusons definition of money to you "_trust, inscribed". _You appeared to agree 100%?

Trust is an abstract form of communication transmitted from one human to another. 

You trust your wife/husband/partner/brothers/sisters/children/parents/ friends etc. You trust your work colleagues and associates.
Occasionally, though, that trust can be broken and all value is lost, or damaged. Sometimes repairable, sometimes not.
But it is all an abstract form of human communication.

Cast your trust-net a little further, to retailers, traders, business associates and competitors.
Like electricity, trust only transports so far before it needs another foundation to carry it further. In electrical terms, power-stations and the electric grid do the job, allowing electricity to flow to far-flung remote destinations across the globe. Marvellous.

In human trust terms, a written legal contract can act as a power-station. It allows humans to spread their trust and conduct business and trade far beyond their own immediate inner circle and community. Practically anywhere across the globe, another marvellous invention.

Underpinning the global order of trade, commerce and communication is energy. Electricity being the fundamental energy source that facilities all our modern conveniences.
I have €20 paper note that I have no doubt you would trust if I were to exchange it for goods or services provided by you. However, obviously, we cannot exchange paper money in a timely efficient manner by today's standards, so we need something else. Thankfully, digitalisation, and the electric energy that it operates on, allows us to exchange money more efficiently.
Using electric energy (and the global banking infrastructure in-between) we can transfer information to one another that says my monetary value is reduced €20 and your monetary value is increased equally by €20 and we trust this to be true.

With bitcoin, I can transfer 1 BTC to you via digital transaction existing on electricity (no banking infrastructure needed) and that transfer is information that says my BTC holding has reduced by one and yours has increased by one, and we trust this also to be true. 

Money is now created, it is trust inscribed and is transferable out of nothing but electric energy.


----------



## tecate

Duke of Marmalade said:


> I don't quite know what Henry's idea was but my guess is that it was centred on two aspects, first and foremost that energy has intrinsic value and secondly that it costs (money?) to produce.


It's explained in Charles Edwards article which I linked to. The rationale is that what Ford proposed had an energy backing. Edwards likens the notion to that of bitcoin - you can try and deny the energy input in this context all you want but it's wayward to do so.

By the way, seeing as you put so much faith in a certain type of economist (the nobel prize winning type), you should note this quote from renowned economist Fredrick Hayek which pops up in Edwards' article:

"_I don’t believe we shall ever have a good money again before we take the thing out of the hands of government. That is, we can’t take it violently out of the hands of government, all we can do is by some sly roundabout way introduce something that they can’t stop.”_


----------



## WolfeTone

tecate said:


> "_I don’t believe we shall ever have a good money again before we take the thing out of the hands of government. That is, we can’t take it violently out of the hands of government, all we can do is by some sly roundabout way introduce something that they can’t stop.”_



This is important. Governments and central banks have taken a monopoly position on money. But money is not the preserve of any institution or organisation to be controlled, and determined by any given policy, at any given time. It is too important for that. Money is the human system of communicating value to one another.


----------



## Duke of Marmalade

tecate said:


> It's explained in Charles Edwards article which I linked to. The rationale is that what Ford proposed had an energy *backing*. Edwards likens the notion to that of bitcoin - you can try and deny the energy input in this context all you want but it's wayward to do so.


Henry was proposing a *backing *for the currency. Instead of a promise to redeem in gold, it was a promise to be able to purchase an amount of electricity. He clearly believed the currency had to have intrinsic value/backing.  One can see that Kw/h has many desirable features in that respect, much superior to, for example, sugar.  To claim that this in any way endorses bitcoin miners dumping a trillion, trillion, ziga Kw/h down the pan as a fulfilent of Henry's dream is "wayward" beyond comprehension.



tecate said:


> By the way, seeing as you put so much faith in a certain type of economist (the nobel prize winning type), you should note this quote from renowned economist Fredrick Hayek which pops up in Edwards' article:
> 
> "_I don’t believe we shall ever have a good money again before we take the thing out of the hands of government. That is, we can’t take it violently out of the hands of government, all we can do is by some sly roundabout way introduce something that they can’t stop.”_


Hayek clearly sees merits in a money free of all government control.  I don't agree with him but I can understand the viewpoint.  Bitcoin purports to achieve that and if it did then I presume Hayek would be a supporter.  But bitcoin does not achieve that since, as Satoshi pointed out, it has no intrinsic value, something which would cause Henry to dismiss it out of hand.


----------



## Duke of Marmalade

WolfeTone said:


> This is important. Governments and central banks have taken a monopoly position on money. But money is not the preserve of any institution or organisation to be controlled, and determined by any given policy, at any given time. It is too important for that. Money is the human system of communicating value to one another.


It would not be a desirable thing IMHO but that is not the point.  The point is that bitcoin does not fulfill that róle as it is not money; it has no intrinsic value; it is not used in any material way as a medium of exchange.


----------



## Duke of Marmalade

WolfeTone said:


> Ah, Duke, you do yourself a disservice.
> 
> I put the Professor Fergusons definition of money to you "_trust, inscribed". _You appeared to agree 100%?
> 
> Trust is an abstract form of communication transmitted from one human to another.
> 
> You trust your wife/husband/partner/brothers/sisters/children/parents/ friends etc. You trust your work colleagues and associates.
> Occasionally, though, that trust can be broken and all value is lost, or damaged. Sometimes repairable, sometimes not.
> But it is all an abstract form of human communication.
> 
> Cast your trust-net a little further, to retailers, traders, business associates and competitors.
> Like electricity, trust only transports so far before it needs another foundation to carry it further. In electrical terms, power-stations and the electric grid do the job, allowing electricity to flow to far-flung remote destinations across the globe. Marvellous.
> 
> In human trust terms, a written legal contract can act as a power-station. It allows humans to spread their trust and conduct business and trade far beyond their own immediate inner circle and community. Practically anywhere across the globe, another marvellous invention.
> 
> Underpinning the global order of trade, commerce and communication is energy. Electricity being the fundamental energy source that facilities all our modern conveniences.
> I have €20 paper note that I have no doubt you would trust if I were to exchange it for goods or services provided by you. However, obviously, we cannot exchange paper money in a timely efficient manner by today's standards, so we need something else. Thankfully, digitalisation, and the electric energy that it operates on, allows us to exchange money more efficiently.
> Using electric energy (and the global banking infrastructure in-between) we can transfer information to one another that says my monetary value is reduced €20 and your monetary value is increased equally by €20 and we trust this to be true.
> 
> With bitcoin, I can transfer 1 BTC to you via digital transaction existing on electricity (no banking infrastructure needed) and that transfer is information that says my BTC holding has reduced by one and yours has increased by one, and we trust this also to be true.
> 
> Money is now created, it is trust inscribed and is transferable out of nothing but electric energy.


Oh dear, _wolfie_, in your full flown Michael D mode.  I do fear that I am out of my intellectual depth in these parts.  You will see my nigh eve comments on the electricity motif, in my reply to @tecate.


----------



## WolfeTone

Duke of Marmalade said:


> Oh dear, _wolfie_, in your best Michael D mode.




 _Hah_! Fair enough! 

In simplified terms, bitcoin is money. 

Money is not a product or function created, distributed and managed by over-arching authority to be bestowed upon the people. 
It is the other way round. People bestow privilege to over-arching authorities to distribute and manage their money. When that privilege is being debased, people look to other means to protect the value of their money. 

Bitcoin broke $50,000 earlier today.


----------



## Duke of Marmalade

WolfeTone said:


> _Hah_! Fair enough!
> 
> In simplified terms, bitcoin is money.


I do not agree.


WolfeTone said:


> Money is not a product or function created, distributed and managed by over-arching authority to be bestowed upon the people.
> It is the other way round. People bestow privilege to over-arching authorities to distribute and manage their money. When that privilege is being debased, people look to other means to protect the value of their money.


If such an alternative means existed I would certainly go for it.  Bitcoin does not do it for me.


WolfeTone said:


> Bitcoin broke $50,000 earlier today.


Yes, u_nnnn_believable.     It has a market cap of nearly 1 trillion dollars.  1 trillion dollars with no substance whatsoever.  How does this make sense?  Yes there are trillions of fiat which has no intrinsic value but behind that are debts both private and public, a legal commitment by these agents to deliver economic value sufficient to pay the debts.  Yes there is the risk that they will be able to pay back their debts at a much increased pricing level for their economic activity (inflation).  It is the job of the central bank to manage this risk but yes it is a risk and if I could duck that risk I would do so, but I would see bitcoin as a much much greater risk.


----------



## DazedInPontoon

They say the first trillion is the hardest


----------



## tecate

Duke of Marmalade said:
			
		

> Henry was proposing a backing for the currency. Instead of a promise to redeem in gold, it was a promise to be able to purchase an amount of electricity. He clearly believed the currency had to have intrinsic value/backing. One can see that Kw/h has many desirable features in that respect, much superior to, for example, sugar. To claim that this in any way endorses bitcoin miners dumping a trillion, trillion, ziga Kw/h down the pan as a fulfilent of Henry's dream is "wayward" beyond comprehension.



Ford was proposing a way to get money out of the hands of Kings and central bankers as he recognised that they weren't using that monopoly for the benefit of society. He stated this:

_"It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning."_

You've often said that you would approve of bitcoin if it was backed by a physical resource. It's clear what obstacles Ford faced when he tried to run with that based on his comment -> "_A simple affair of business which should have been decided by anyone within a week has become a complicated political affair."_

They successfully frustrated his efforts.

Whatever way you slice and dice it, bitcoin is the product of a mass of energy. That's undeniable. That electricity is an input that results in its production.



			
				Duke of Marmalade said:
			
		

> But bitcoin does not achieve that since, as Satoshi pointed out, it has no intrinsic value, something which would cause Henry to dismiss it out of hand.


Satoshi was the first bitcoin critic - so he critiqued aspects of his own project. You're homing in on one isolated utterance he pondered on a message board before the project was finalised. The fact remains, he came to the ultimate conclusion to launch bitcoin.
Ford's present day auto-industry counterpart (Musk) certainly is on board where btc is concerned and there's every indication that Henry would approve. He would certainly have known - after that experience - that a different approach would be necessary - one that they couldn't crush. Hayek is blatant in pointing to exactly that.


----------



## DazedInPontoon

Seems like the world is getting a lesson in exponential growth (and not just from COVID) and giffen goods and perhaps even veblen goods


----------



## DazedInPontoon

My quip about the first trillion was indeed a quip but not meant to be mean or troll you. In fact it was also rooted in truth, I think the most likely outcome now is that bitcoin is closer to 2 trillion market cap than 1 before this cycle peaks.

And as ever, my money is where my mouth is. As I said in response to that Roubini guy making a big deal out of the correction from 20k to 17k in November: https://askaboutmoney.com/threads/t...ing-in-the-future.206598/page-19#post-1693875

After 20k, the next target was 50k, after 50k the next is 100k.


----------



## Duke of Marmalade

DazedInPontoon said:


> My quip is not meant to troll you


@tecate obstinately persisted with the nonsense that bitcoin’s massive energy wastage is the fulfilment of Henry Ford’s vision.  That is an obstinacy that I expect from that quarter.  But a “like” from someone who clearly recognises this as nonsense is pure troll.


----------



## tecate

@dukey: When you refer to wastage, you immediately deprive yourself from understanding the contribution that bitcoin mining makes. Anyone who doesn't recognise from the outset that it serves the purpose of securing the network will never get it but so be it.

Other than that, those quotes from Ford and Hayek are priceless - they confirm that a solution like bitcoin has long been needed.

On 'likes', I have no idea what you're referring to.


----------



## tecate

As per an interview on CNBC earlier, Blackrock (the World's largest asset manager with $7 trillion AUM) has confirmed that it has started to dabble in bitcoin.
Meanwhile, Michael Saylor of MicroStrategy confirmed that the company is seeking to borrow another $900 million with a view to investing it in bitcoin.


----------



## WolfeTone

To lighten the mood, a trip down memory lane for some. For others, skip to 7 mins 15 secs to get the jist of the story.

As it happens, the Bagpuss childrens show was having much the same debate as we are all having back in 1977, concerning a Chocolate Goldgrain biscuit.

Depending on your perspective, the Millhouse is either a bitcoin mining operation or a Central Bank.
Either way, I'm reserving the part of the Woodpecker Professor for @Duke of Marmalade


----------



## tecate

Bitcoin has now reached a $1 trillion market capitalisation.

_“There is nothing more powerful than an idea whose time has come"_ - Victor Hugo.


----------



## WolfeTone

Well at these prices I had to do some reflection. 

I am not talking about life-changing amounts here but my bitcoin holding has become valuable, way beyond what I thought it could at this point. The psychology at play in this market is something I have never experienced before. But an instinct I have is to go against the grain. Instead of FOMO, I'm now in the FOLO camp. 
So I cashed in a portion of my BTC today to cover my outlay and taking an equal sum profit as a feel good factor.

The nice thing is I'm now riding the bitcoin wave for free. The sad thing is, FOMO has emerged once more.


----------



## joe sod

I'm no bitcoin expert and have been wrong on how this keeps coming back from the dead when the bubble appears to have burst like in 2018, this is fairly unique as the huge sell offs in 2018 and early 2020 usually kill the bubble completely. 
One thing I've noticed though is that bitcoin is strongly correlated with the speculative tech boom, when tech stocks get whacked so does bitcoin. This would be powerful evidence that digital gold it definitely isn't as it's price should be moving opposite to speculative technology stocks.


----------



## tecate

joe sod said:


> One thing I've noticed though is that bitcoin is strongly correlated with the speculative tech boom, when tech stocks get whacked so does bitcoin. This would be powerful evidence that digital gold it definitely isn't as it's price should be moving opposite to speculative technology stocks.


Check out Lyn Alden's piece from last October on bitcoin correlations. Everything is being affected by the rampant money printing. That money has to end up somewhere. Over the course of it's history, bitcoin has been largely uncorrelated with other asset classes. Whilst it has shown periods of correlation with either equities generally or tech stocks more specifically/recently, so too has gold.
Gold followed equities down in the early stages of the 2008 financial crisis (taking a 30% hit). It did the same last March. Here's an analysis from last September showing increasing correlation between gold miners and tech stocks more recently.

Bitcoin has been likened to gold because of its properties as a store of value. However, it's a (relatively) young, immature asset, formative in that role. I believe that at some stage that likeness will be dropped and bitcoin will be understood to have its own unique qualities as a store of value going forward. It offers many advantages over gold. It's transparently finite - and the most finite financial asset there's ever been. It goes beyond gold in its abilities to act as a base settlement layer. It can be transacted globally/digitally in real time - irrespective of borders. It's censorship resistant and with proper storage, it's unconfiscatable. On the other hand, gold has been largely centralised due to storage difficulties - which has led to the market being highly manipulated.

As for the sell off over the past few days, I would say that correlation is coincidental as much as anything else. Bitcoin had risen sharply and this pullback is healthy and needed. It clears out the more speculative leveraged traders. In the aftermath of that short term clear-out, the asset is above $50,000 right now.


----------



## DublinHead54

I laugh at Musk trolling Bitcoin and Crypto right now.


----------



## DublinHead54

tecate said:


> Check out Lyn Alden's piece from last October on bitcoin correlations. Everything is being affected by the rampant money printing. That money has to end up somewhere. Over the course of it's history, bitcoin has been largely uncorrelated with other asset classes. Whilst it has shown periods of correlation with either equities generally or tech stocks more specifically/recently, so too has gold.
> Gold followed equities down in the early stages of the 2008 financial crisis (taking a 30% hit). It did the same last March. Here's an analysis from last September showing increasing correlation between gold miners and tech stocks more recently.



You have said BTC is uncorrelated with other asset classes and then provided examples of it being correlated in the same paragraph!


----------



## tecate

tecate said:


> Over the course of it's history, bitcoin has been* largely* uncorrelated with other asset classes. Whilst it has shown periods of correlation with either equities generally or tech stocks more specifically/recently, so too has gold.


----------



## DublinHead54

I really don't understand what point this is meant to make, you have undermined your own argument. You are basically saying it is uncorrelated but sometimes it is correlated. 

Elon Musk trolled BTC, it is no surprise that after he announced the price was too high of BTC and ETH that the price then tumbled. Crypto Twitter is a massive cause of volatility in the market.


----------



## tecate

One thing that these discussions have shown is that if someone is looking for 'argument' they will find it. There is no such argument to be found - just statement and consideration of fact.

Gold and gold miners have been found in the past to be correlated with equities and tech stocks during specific periods. Bitcoin has also been found to have been correlated with A. gold , B. equities and C. tech stocks during specific periods yet when we zoom out and view its 12 years as a whole, it has been largely uncorrelated. Of course, all of this is being discussed with the consideration that bitcoin is developmental in its role as a store of value, as digital gold and as a completely distinct asset in its own right.


----------



## Bronte

Gold rush, tulip wars and Bitcoin. Who ends up paying.


----------



## tecate

Bronte said:


> Gold rush, tulip wars and Bitcoin. Who ends up paying.


The fiat money printing experiment - who ends up paying (and who has been paying all along).


----------



## ArthurMcB

WolfeTone said:


> Well at these prices I had to do some reflection.
> 
> I am not talking about life-changing amounts here but my bitcoin holding has become valuable, way beyond what I thought it could at this point. The psychology at play in this market is something I have never experienced before. But an instinct I have is to go against the grain. Instead of FOMO, I'm now in the FOLO camp.
> So I cashed in a portion of my BTC today to cover my outlay and taking an equal sum profit as a feel good factor.
> 
> The nice thing is I'm now riding the bitcoin wave for free. The sad thing is, FOMO has emerged once more.


Wolfie, judging by your post, you prob cashed out just before btc went south sunday eve/monday morning. Fair dinkum.


----------



## NotMyRealName

"Like flies to wanton boys we are to the gods.......they kill us for their sport."
Elon tweets and bitcoin reacts plus or minus. Remember He tweeted about taking Tesla private and then it entered into the S and P 500. So, by proxy, we're all along for the bitcoin ride....and the Tesla ride. 
As far as I can see Tesla's profit has come from trading carbon credits to the major auto companies. Tesla may become like GE and have several strings to its bow.....grow to a giant and, perhaps eventually, end up at €12 and change per share....or 1BTC 
I wish Wolfie all the best...but there's no such thing as playing with the bookies money. It is/was your money. My advice is take it. After midnight ,most parties are in decline and have a high risk of messiness.


----------



## WolfeTone

Dublinbay12 said:


> I really don't understand what point this is meant to make,



I don't know how you can not understand the point, with the exception that if you deliberately drop the words "largely" and "periods of" out of @tecate comment above then you can arrive at wholly different conclusion to point being made.


----------



## DublinHead54

I am waiting for Musk to start pumping it again, give him a few days.

I am still shocked at how some posters here make statements of 'fact' whilst not being factual whatsoever


----------



## DublinHead54

WolfeTone said:


> I don't know how you can not understand the point, with the exception that if you deliberately drop the words "largely" and "periods of" out of @tecate comment above then you can arrive at wholly different conclusion to point being made.



What was the point of it? What argument did those comments support? Genuinely it is unclear and not well articulated.


----------



## tecate

NotMyRealName said:


> "Like flies to wanton boys we are to the gods.......they kill us for their sport."
> Elon tweets and bitcoin reacts plus or minus. Remember He tweeted


There are different stakeholders in crypto. I'm sure there are more recent arrivals who reacted superficially. There are also those who don't and didn't. Nobody will argue with the suggestion that bitcoin has yet to mature. However, there's more to it than someone notable tweeting. Much debated in these parts but I'm quite confident that there is something tangible at the heart of this...but we all make up our own minds on that.
Be aware also that media always look to attach a narrative to a market movement...the first narrative that they can find. Nothing goes up in a straight line - it was due a pullback - just like we had a 30% pullback last month.


WolfeTone said:


> I don't know how you can not understand the point, with the exception that if you deliberately drop the words "largely" and "periods of" out of @tecate comment above then you can arrive at wholly different conclusion to point being made.


Wolfie, you've been an active participant in these discussions over the duration. I'm quite confident you know what's at play here - and it has little to do with a genuine interest in furthering the discussion. Take no notice.


----------



## DublinHead54

I have come to realize, that @tecate  is incapable of recognising any critique of BTC. That is why he structures all his responses with a get out of free clauses 'some people reacted, some people didn't, 'it isn't correlated, sometimes it is correlated', 'BTC isn't mature, it will solve the issues'.

What is ironic is that this type of closed-mindedness is the antithesis of crypto. If anything the simple fact is there are many people in the community that criticise, hence the bitcoin forks.

I don't need Tecate to respond to these comments, he has already shown his colours in many other threads and resorted to insults.

I just hope any newcomers to this thread don't fall for his hyperbole on the topic. I think the best statement has been the claim that BTC mining will actually solve climate change. .

Maybe we should move onto how Bitcoin can cure cancer.


----------



## NotMyRealName

@tecate ,I neither have a philosophical or financial interest in bitcoin. It seemed to me that Wolfie felt he may be getting light-headed at bitcoin altitude. So it's purely a book-your-profit view. One can still be part of the story of bitcoins success even if you took early profit. It's the psychology of profit and loss not the philosophy of Blockchain. Please accept these peace offerings. Tulips attached..... they're still around and lovely to look at..


----------



## Steven Barrett

tecate said:


> The fiat money printing experiment - who ends up paying (and who has been paying all along).



Would you support a return to the gold standard? That is the impression that I get from Bitcoin aficionado's who constantly talk about fiat money and the weakness of it. You can therefore assume that they think the currency should be backed by something i.e. gold or Bitcoin.


----------



## tecate

SBarrett said:


> Would you support a return to the gold standard? That is the impression that I get from Bitcoin aficionado's who constantly talk about fiat money and the weakness of it. You can therefore assume that they think the currency should be backed by something i.e. gold or Bitcoin.


I believe in hard money. I would certainly support the gold standard not having been done away with in the first instance. However, given where we are right now, I'm happy with the bitcoin standard as a counterweight to rampant money printing. I don't think people's savings should be stolen by stealth to hide the screwups that governments make or pay for their pet projects (that may not be in the ordinary joe's interests). Gold can be counterfeited, it is largely centralised - meaning it's under central authority control - leading to the manipulation that Henry Ford identified 100 years ago (and every point in between). Bitcoin will have a similar battle albeit that it stands a better chance as it is much easier to self custody.
Other than that, I'm not suggesting that sovereign currencies be done away with - just that regular people have a safe haven where their personal wealth doesn't wither away (or be confiscated, etc.).


NotMyRealName said:


> @tecate ,I neither have a philosophical or financial interest in bitcoin. It seemed to me that Wolfie felt he may be getting light-headed at bitcoin altitude. So it's purely a book-your-profit view. One can still be part of the story of bitcoins success even if you took early profit. It's the psychology of profit and loss not the philosophy of Blockchain. Please accept these peace offerings


Can't argue with that - there's never a bad time to book a profit.


----------



## Steven Barrett

tecate said:


> I believe in hard money. I would certainly support the gold standard not having been done away with in the first instance. However, given where we are right now, I'm happy with the bitcoin standard as a counterweight to rampant money printing. I don't think people's savings should be stolen by stealth to hide the screwups that governments make or pay for their pet projects (that may not be in the ordinary joe's interests). Gold can be counterfeited, it is largely centralised - meaning it's under central authority control - leading to the manipulation that Henry Ford identified 100 years ago (and every point in between). Bitcoin will have a similar battle albeit that it stands a better chance as it is much easier to self custody.
> Other than that, I'm not suggesting that sovereign currencies be done away with - just that regular people have a safe haven where their personal wealth doesn't wither away (or be confiscated, etc.).



With the current prices of Bitcoin and the volatily of it, can't people's personal wealth fall away fairly dramatically if they buy it at the wrong time. It has fallen by 34% in three days in the past. It has also risen over 1600% in a number of months. How good a storer of wealth can it be if it has wild swings in value? 

Also, is it a replacement of gold or currency? Was it not invented as a decentralised currency that people used to buy stuff with (mainly drugs and weapons on the dark web in the early days)? You'd be made to use it to buy anything these days. Apologies if all this has been discussed already, I haven't read the previous 15 pages of this thread.


----------



## NotMyRealName

Then of course there's another observation in the Bitcoin,Gold, Fiat Currency menage-a-trois. 
Fiat currency value to the average punter is largely ethereal , and has no real physical practical application value. Gold has its physical uses and can be conspicuously displayed as a signal of wealth. 
Hard to imagine bitcoin necklaces or Pussy Galore helping BitcoinFinger to corner the market.......
Just sayin'.....


----------



## tecate

SBarrett said:


> With the current prices of Bitcoin and the volatily of it, can't people's personal wealth fall away fairly dramatically if they buy it at the wrong time. It has fallen by 34% in three days in the past. It has also risen over 1600% in a number of months. How good a storer of wealth can it be if it has wild swings in value?


If you have a short term time preference, then sure - you have to be cognisant of the volatility. However, over the longer term, it has performed as a store of value. It's entirely logical to me that it needs to go through these phases of price discovery.  Think about it - you launch bitcoin tomorrow as a finite asset and it maintains that one price from day one or that price is discovered along the adoption curve?
Volatility is unavoidable and will be a feature of bitcoin for some years to come. By the way, lets not forget that gold has gone through similar volatility in its history but somehow people don't seem to get as animated about that.


SBarrett said:


> Also, is it a replacement of gold or currency? Was it not invented as a decentralised currency that people used to buy stuff with (mainly drugs and weapons on the dark web in the early days)? You'd be made to use it to buy anything these days. Apologies if all this has been discussed already, I haven't read the previous 15 pages of this thread.


It's being adopted right now as a store of value/digital gold. It has the characteristics to take on that role. It is also being used as a settlement layer for larger transactions. Some want it to act as a transactional currency - and it's currently limited in that ability for micro-transactions due to scaling issues. These are issues that are being worked on by developers (by way of layer 2 solutions eg. lightning network). So rather than write it off on that basis, people should be aware that this use case may come back into play. Even if it never does, there's enough depth in that first use case for it to thrive.
In its very early days, yes it was used on the dark web - but that is not the extent to its use case. We've seen growth in its use as a means of exchange in places like Nigeria where capital controls are draconian. I've used it myself in recent weeks to move $ out of a developing country (legitimate $ that was brought in according to the bureaucratic system that exists here) simply because I don't want to go through the bs they have in place to get my money out (because in countries like this, it doesn't feel like its ever your money...and in actual fact, it isn't - it's theirs).
On the subject of criminal use, cash remains the king for illicit trade. Meanwhile, recent studies have shown that no more than 1% of btc transactions are related to illicit trade.




NotMyRealName said:


> Then of course there's another observation in the Bitcoin,Gold, Fiat Currency menage-a-trois.
> Fiat currency value to the average punter is largely ethereal , and has no real physical practical application value. Gold has its physical uses and can be conspicuously displayed as a signal of wealth.
> Hard to imagine bitcoin necklaces or Pussy Galore helping BitcoinFinger to corner the market.......
> Just sayin'.....


That's a reasonable point. It's been discussed at length here over the last 3-4 years. My own view is that you've more or less stated that it's used as jewelry as a store of wealth. There are plenty of polished rocks that are used to make jewelry - but the interest is in gold because its valuable. It's valuable because its finite. Meanwhile bitcoin is more finite. Bitcoin also offers other advantages ...such as the ability to transmit it globally to whomever you want practically instantly. You can custody it yourself and cross borders with it - without the risk of confiscation.
That's my take - whilst many here take the opposing view. I don't think there's any point in re-hashing that - it is what it is. The only other point I'd make is that there is also a generational shift here in terms of how digital currencies are perceived and I'm sure that's playing in to views expressed here on AAM.


----------



## WolfeTone

NotMyRealName said:


> It seemed to me that Wolfie felt he may be getting light-headed at bitcoin altitude. So it's purely a book-your-profit view.



Yes and no. The high altitude gave pause for thought, for sure. Im not a bitcoin-to-the-moon maximalist, and while I accept it may return to zero one day, such a return will have nothing to do with the perception today as nothing more than a BOHA.
Either a fundamental flaw in its tech, as yet to be detected, or the emergence of a superior piece of technology that does everything bitcoin is supposed, but only better. 

That said, I only sold a portion of my bitcoin holding. In part to cover my outlay, which makes sense to me considering the price went to multiples the cost dollar average of my outlay. 
I also cashed in another equal portion pure profit, as a feel-good factor....but as I mentioned, the feeling of FOMO arose once more.
In the end, I miss having my bitcoin more than I enjoy having my fiat returned with profit. So the consideration is to use the profit to buy back in, but I will take my time - bitcoin is here for the long-term, so no rush.

Overall, my initial foray into bitcoin about 4yrs ago was purely speculative and out of curiosity. But it is has been a great education more than anything else. It has certainly opened my eyes to reconsidering many perceptions I have about the world I live in (Covid also). I would recommend it to everyone


----------



## joe sod

I made the point above that bitcoin is closely correlated to the fortunes of the technology sector,  it is afterall a child of the tech boom. That however is also it's fundamental weakness it cannot exist independent of technology. People that hold gold hold it not just because it is valuable but also because it is indestructible and exists independent of man and technology. If the power grid was to collapse in an armagedon scenario where would bitcoin be? As was pointed out above bitcoin requires enormous amounts of energy just to create it is completely dependent on modern industrial and technical predominance


----------



## NotMyRealName

tecate said:


> - but the interest is in gold because its valuable. It's valuable because its finite. Meanwhile bitcoin is more finite.


....and what about say, water?  ( I have a position on this....even before Michael Burry's ( see The Big Short).
It's Finite, absolutely vital , even tulips need it....but we put very little value on it...It's not sexy but my investment has ticked up nearly 200% in about 10 years with volatility between, let's say, "normal" investment parameters. Eventually, you may be offering your Bitcoin for my water.......and I may not sell it.


----------



## Duke of Marmalade

joe sod said:


> I made the point above that bitcoin is closely correlated to the fortunes of the technology sector,  it is afterall a child of the tech boom. That however is also it's fundamental weakness it cannot exist independent of technology. People that hold gold hold it not just because it is valuable but also because it is indestructible and exists independent of man and technology. If the power grid was to collapse in an armagedon scenario where would bitcoin be? As was pointed out above bitcoin requires enormous amounts of energy just to create it is completely dependent on modern industrial and technical predominance


I am not unsympathetic to the point but just to get the electricity dependence in perspective.  Let’s say there was a crippling global carbon tax imposed.  It would drive miners out of business but there would be an awful awful long way to go before the integrity of the blockchain was compromised.  It is currently operating at 21 trillion times the capacity that Satoshi originally thought appropriate to secure the blockchain.


----------



## tecate

joe sod said:


> I made the point above that bitcoin is closely correlated to the fortunes of the technology sector,  it is afterall a child of the tech boom. That however is also it's fundamental weakness it cannot exist independent of technology. People that hold gold hold it not just because it is valuable but also because it is indestructible and exists independent of man and technology. If the power grid was to collapse in an armagedon scenario where would bitcoin be? As was pointed out above bitcoin requires enormous amounts of energy just to create it is completely dependent on modern industrial and technical predominance


So you're presenting a scenario where the bitcoin network as a whole goes down. The network is distributed over 195 countries. It's been a bad day at the office for planet earth then if ALL parts of the planet have been struck down such that there is no power whatsoever. Imagine yourself under those conditions. You're talking about complete societal breakdown. You don't need money to pay for anything - you'll need might. I'll try to pay for something with gold and you won't have any idea if its real or fake. Secondly, are we going to spend all day melting it down to the exact value that equals the loaf of bread I'm trying to buy off you (given that gold fails in terms of divisibility)? But if we have no power worldwide, then the rule of law doesn't exist - we just have chaos and the 'currency' is the baseball bat or whatever other weapon is lying around.

Availability is an interesting point though. A day after former Fed Reserve Chair & current treasury secretary Janet Yellen criticised bitcoins shortcomings, FedWire - the funds settlement system operated by US Federal Reserve Banks - went offline. In it's 12 years of existence, the bitcoin network has never been offline.


NotMyRealName said:


> ....and what about say, water?  ( I have a position on this....even before Michael Burry's ( see The Big Short).
> It's Finite, absolutely vital , even tulips need it....but we put very little value on it...It's not sexy but my investment has ticked up nearly 200% in about 10 years with volatility between, let's say, "normal" investment parameters. Eventually, you may be offering your Bitcoin for my water.......and I may not sell it.


I'm not sure what your point is specifically?  However, water is a commodity. I believe that there's now a water futures market. If you're comparing water and bitcoin in terms of scarcity, then I would say that bitcoin is more perfectly finite. Water can be made  - additional bitcoin can't. Lets take any commodity that becomes scarce. The price goes up - then new tech becomes feasible in attempting to find more of that resource. In the case of water desalination, such plants exist but they're few and far between because they're not economically feasible. In the scenario you describe, they would become feasible - and now you will have more sources/supply of that resource. Take gold as the example in that instance. It's price goes up and now other methods of mining it become economically viable. This scenario played out with oil in recent years. Remember a few years ago all the talk about peak oil?  The price went up - then new tech came along (fracking)..and now nobody talks much about us running out of that resource.
In considering bitcoin in that context, scarcity has been designed in. As its adopted and it becomes more scarce, there is absolutely nothing that can be done to produce more of it. It's perfectly finite. Everyone on the planet knows how much bitcoin has ever been issued, how much has been issued today and what the ultimate limit is.


----------



## EmmDee

tecate said:


> FedWire - the funds settlement system operated by US Federal Reserve Banks - went offline. In it's 12 years of existence, the bitcoin network has never been offline.



I get your optimism for BTC - and I find your arguments interesting. But I'm not sure why you feel the need to make it a "zero sum game" vs traditional banking networks. Or if you're going to make the comparison then at least be accurate about it. Fedwire was down for a short while but all activity was transacted before end of day.

The BTC network is certainly more distributed. But it also handles a tiny fraction of the volume and value of something like Fedwire. It also had much longer processing time and significantly higher transaction charges than Fed - or similar.

That's not to invalidate BTC. It's just that it would struggle to replace existing networks. I don't think most people / corporates would accept a $20 charge for every transaction and a wait of up to days to complete. Fedwire is a cent or two and seconds to confirm

However underlying blockchain technology is being used for regular cash movements between banks


----------



## Duke of Marmalade

EmmDee said:


> However underlying blockchain technology is being used for regular cash movements between banks


I wonder what exactly this means.  Several aspects come to mind.  A chain of blocks of data, time stamped and linked by their hashes.  Private/public keys.  Compression of multiple transactions into Merkle trees.  All these things might have a usage in conventional banking.  But Proof of Work?  Please don't tell me banks are engaging in zillions of hash puzzles per second.  As Yellen said, the most inefficient mechanism one could imagine.


----------



## joe sod

@Duke of Marmalade  are you suffering from Stockholm syndrome,  the new Patty Hearst?, you are talking all the bitcoin jargon now


----------



## Duke of Marmalade

Trust me @joe sod I have not lost the faith.
I believe in Nouriel.
I believe in Yellen.
I believe in Paul "Fax Machine"  Krugman
I believe in Joseph Stiglitz

Just because I can cite from the Koran does not make me an Ayatollah!


----------



## DazedInPontoon

EmmDee said:


> Fedwire is a cent or two and seconds to confirm



How many countries is it available in? Who has access to it? How long before a transaction has settled and you are guaranteed it will not be reversed? Does it work on days beginning with 'S'?

All of the current systems have their limitations in terms of final settlement time, transaction size limits, geographic coverage and accessibility. If you want you'll be able to cherry pick transactions that make any of them seem like the 'best', including bitcoin.


----------



## DazedInPontoon

On this topic, Jack Mallers is probably the guy doing the most in the bitcoin ecosystem to improve the payments use-case.

Bitcoiners would consider bitcoin a rock solid settlement layer, but the downsides are volatilty of bitcoin price and transaction limits, fees and variable times for transactions to confirm. Jack is attempting to address both of those downsides with his Strike Global service: volatility by conversion to stable coins so balances are held in units pegged to fiat, and transaction time/fees/limits by using the lightning network layer on which bitcoin transactions settle instantly.

This approach no doubt introduces other challenges such as opening of lightning channels and reliance on stable coins, but it's interesting.
I'm reserving judgment either way until I see how it works out for him.

Here's a 15 minute read from him about it if you're curious: https://jimmymow.medium.com/announcing-strike-global-2392b908f611


----------



## tecate

EmmDee said:


> Or if you're going to make the comparison then at least be accurate about it. Fedwire was down for a short while but all activity was transacted before end of day.



I was making a point about the comparative reliability of the bitcoin network. If you'd like to expand on the implications of the fedwire outage, that's fine. However, it doesn't make my comment inaccurate.



EmmDee said:


> The BTC network is certainly more distributed. But it also handles a tiny fraction of the volume and value of something like Fedwire.


Fedwire is for transfers between financial institutions. Therefore, of course they're worlds apart in terms of overall $ value transferred. However, on volume/transactions, that gap isn't as large as you'd imagine. My understanding is that if transaction batching is taken into account, bitcoin and Fedwire do about the same number of transactions. Bitcoin settles around $10billion/day whereas Fedwire settles $3.3T/day. Yet we've identified that transaction volume is similar - thus scaling up to act as a base settlement layer isn't an issue.



EmmDee said:


> It also had much longer processing time and significantly higher transaction charges than Fed - or similar.


Well, on processing times, we're comparing a centralised database with a decentralised blockchain so of course transaction costs and times can be lower - but the trade offs have to be recognised. Anyone on the planet can access that bitcoin settlement base layer. You need a banking license as  a prerequisite and permission beyond that to access Fedwire directly.



EmmDee said:


> That's not to invalidate BTC. It's just that it would struggle to replace existing networks.


See above. It currently executes similar transaction volume to Fedwire. If we're talking about other layers stacked on top of Fedwire (visa, ach, atm networks, etc), then bitcoin can run with that too (via it's developing layer 2 - lightning network).



EmmDee said:


> I don't think most people / corporates would accept a $20 charge for every transaction and a wait of up to days to complete. Fedwire is a cent or two and seconds to confirm


Lets compare like with like. Fedwire is centralised and so it costs a couple of cents.  However, the average Fedwire transaction is $2 million so the btc fee you refer to is inconsequential when moving large amounts. Wire transfers that businesses and individuals use cost $25 and upwards.


----------



## tecate

Duke of Marmalade said:


> Trust me @joe sod I have not lost the faith.
> I believe in Nouriel.
> I believe in Yellen.
> I believe in Paul "Fax Machine"  Krugman
> I believe in Joseph Stiglitz
> 
> Just because I can cite from the Koran does not make me an Ayatollah!


You've brought 'Merkle Trees' into the discussion, Dukey - I think you're not going to be able to find your way out of the crypto rabbit hole at this point. One things for sure though, Roubini/Yellen/Fax Machine Guy/Stiglitz didn't bring you up to speed on that. I guess props go to either Gary Gensler or Andreas Antonopoulos on that...



			
				Dazed in Pontoon said:
			
		

> On this topic, Jack Mallers is probably the guy doing the most in the bitcoin ecosystem to improve the payments use-case.


On the waiting list for product roll-out. This should put an end to the big fat fees these remittance services & money service businesses are charging on cross border transfers.


----------



## DublinHead54

Volatility and manipulation are two different things.


----------



## DublinHead54

@EmmDee unfortunately many treat it as a zero-sum game and you can only exist as either a naysayer or bitcoin maximilist. There is no acceptance of the often valid critique of BTC use cases and comparison to comparable technologies/processes. You will see this as Tecate refuses to respond to somebody like myself who has worked on crypto projects, is part of the community but still criticizes it. 

For example, BTC / Blockchain allow for immutable transactions on a decentralized network, whilst something like Fedwire will rely on a host of external/internal controls to try and make transactions immutable. Migrate Fedwire onto DLT and you've negated one of the differences with BTC. The only remaining piece is the decentralized aspect, which I argue is not necessary for every situation.

The potential real game-changer is blockchain, and I firmly believe the term was coined to separate itself for BTC and gain legitmisation allowing people to sell it as a solution.

I don't believe that BTC is the solution to everything, but it has brought interesting concepts and incumbent markets will react and leverage to stay relevant. Perfect example is Central Bank Digital currencies, they don't really need them but they are trying to stay relevant.


----------



## EmmDee

Duke of Marmalade said:


> I wonder what exactly this means.  Several aspects come to mind.  A chain of blocks of data, time stamped and linked by their hashes.  Private/public keys.  Compression of multiple transactions into Merkle trees.  All these things might have a usage in conventional banking.  But Proof of Work?  Please don't tell me banks are engaging in zillions of hash puzzles per second.  As Yellen said, the most inefficient mechanism one could imagine.



The most common (I believe) is Ripple Net. Has about 100 bank members I think


----------



## Steven Barrett

EmmDee said:


> But I'm not sure why you feel the need to make it a "zero sum game" vs traditional banking networks.


I have found this about Bitcoin investors in general. I wrote a blog last week about why I wouldn't be investing in Bitcoin. I got the most emails for this post as I have for any of the 350 blogs I have written over the last 7.5 years. I then read another blog by someone with a must bigger following than me who got over 900 comments when he sold halve of his Bitcoin position in line with his defined investment strategy. 

It reminds me of people investing in property during the Celtic Tiger. That was the only investment you could make and anything else is wrong. No, there are different forms of investing. Bitcoin is here and will probably be here to stay but that doesn't mean people are wrong because they don't want to invest in it. 


Steven
www.bluewaterfp.ie


----------



## tecate

SBarrett said:


> I wrote a blog last week about why I wouldn't be investing in Bitcoin. I got the most emails for this post as I have for any of the 350 blogs I have written over the last 7.5 years.


These days people usually write blogs for engagement - so I guess you got engagement in that instance! 



			
				SBarrett said:
			
		

> No, there are different forms of investing. Bitcoin is here and will probably be here to stay but that doesn't mean people are wrong because they don't want to invest in it.


I agree - and in 4 years of discussion of the topic here, I have never suggested otherwise - nor have I seen anyone else suggest that. On EmmDee's 'zero sum game' comment, I'm not sure what he has in mind there. On a number of occasions, I've pointed out that this doesn't have to be (and won't be) black or white - winner or loser. Sovereign currencies and banks aren't going away. However, people will have other options available to them and options are good. We'll probably see sovereign currencies and banks perform a hell of a lot better in the future because of that.

As evidenced by the Tether/Bitfinex saga, over a number of years attempts were made to suppress crypto by shutting the industry out of banking services. That's still going on - albeit there has been a change in approach in the US that will filter through elsewhere. Central and establishment bankers have torn strips off crypto up until recently (some still do). I think its more than reasonable to express a counter-view. Hence my comment re. Yellen and the irony of her speaking out within 24 hours of the centralised Fedwire system going offline. I take EmmDee's point that the outage may have been brief but it's still significant in terms of it being essential banking infrastructure.


----------



## WolfeTone

Duke of Marmalade said:


> Trust me @joe sod I have not lost the faith.
> I believe in Nouriel.
> I believe in Yellen.
> I believe in Paul "Fax Machine" Krugman
> I believe in Joseph Stiglitz



_Jeez Duke_, you have gone full circle here with the cult-like following.  

What will happen when one of them changes tack and says bitcoin has value?


----------



## Duke of Marmalade

WolfeTone said:


> What will happen when one of them changes tack and says bitcoin has value?


@tecate claims he has a gotcha on Nouriel for that.


----------



## tecate

WolfeTone said:


> What will happen when one of them changes tack and says bitcoin has value?


Nouriel tried to walk it back in November but there's zero goodwill to let his 'fax machine' moment go... and so he's quadrupled down on it again instead. If Ian Paisley hated bitcoin, Nouriel is the Italian-American version of what that looks like.


			
				WolfeTone said:
			
		

> Jeez Duke, you have gone full circle here with the cult-like following.


I'm not sure about any of them changing tack, Wolfie. However, I'd say by the time the next hype cycle comes round, Nouriel will have retired and the Duke will have flipped to full merkle tree mode.


----------



## Duke of Marmalade

tecate said:


> If Ian Paisley hated bitcoin, Nouriel is the Italian-American version of what that looks like.


Ian Paisley came to love Martin McGuinness.  Nouriel supporting btc would be on the same shock level.


----------



## WolfeTone

My money is on Yellen to jump ship first, if she hasn't done so already.


----------



## Duke of Marmalade

WolfeTone said:


> What will happen when one of them changes tack and says bitcoin has value?


_Wolfie_ my faith is stronger than the behaviour of any one prophet.  All the same if Roubini were to endorse btc it would be akin to the pope advertising durex, it would be hard to take.


----------



## DazedInPontoon

Charting website cryptowat.ch has a neat new feature where you can paste a link to a tweet on the chart and it anchors it at the time it was tweeted:






Those lucky retail suckers eh!

Pity this can't be done with AAM posts.


----------



## Lisboa

Energy consumption was discussed here two weeks ago but some may find this new BBC article interesting; https://www.bbc.com/news/science-environment-56215787


----------



## jim

My bitcoin investment, which i made immediately sfter Tesla's investment, is currently worth less than what I invested. How does this make sense? Please discuss.


----------



## WolfeTone

jim said:


> My bitcoin investment, which i made immediately sfter Tesla's investment, is currently worth less than what I invested. How does this make sense? Please discuss.



Because the price people are willing to pay is less than the price you paid for it?


----------



## WolfeTone

Lisboa said:


> Energy consumption was discussed here two weeks ago but some may find this new BBC article interesting; https://www.bbc.com/news/science-environment-56215787



The energy use has been a concern of mine, but less so now. For all the talk of bitcoin using the same energy as Denmark or Argentina, I never hear calls from anyone to shutdown Denmark or Argentina 

Seriously though, we are in an era where there is a move towards converting to clean, renewable energy sources. Bitcoin is in the same boat as everyone. The earth is abundant with clean renewables, it is just a matter of investing in the technologies to harness all that clean energy.
Bitcoin miners have an in-built incentive to reduce their costs. If clean, renewable sources are economically cheaper than fossil fuel sources, then that is where they will go.


----------



## jim

Makes absolute sense, now i feel a tad sheepish.
Hurray to Bitcoin.

But wait..hang on...

If i bought immediately after tesla did does that mean that currently the price people are willing to pay is just about less than what Tesla paid and therefore their investment is currently worth less than their orig investment of 1.5bn?! So they must be distraught.


----------



## tecate

jim said:


> But wait..hang on...
> 
> If i bought immediately after tesla did does that mean that currently the price people are willing to pay is just about less than what Tesla paid and therefore their investment is currently worth less than their orig investment of 1.5bn?! So they must be distraught.


I'm sure Elon thanks you for your empathy but I don't think you need to worry about the Tesla corporation! :-D
Tesla's purchase averaged out at $34,200/btc.
I think it's more of a case of focusing on what makes sense to you based on your own assessment and your own circumstances. There are also other entities entering the market. Here's a recent example. It's diversified alternatives fund won't be able to gain exposure to btc until April 26 at the earliest.


----------



## jim

I dont care a darn for Tesla.

My point is simply - Tesla's 1.5b investment must, at the moment, be breaking even at best? Wasnt it up 1bn at 1 stage.


----------



## tecate

Lisboa said:


> Energy consumption was discussed here two weeks ago but some may find this new BBC article interesting; https://www.bbc.com/news/science-environment-56215787


Another day, another FUD article. If someone decides before considering energy usage that it doesn't achieve anything useful, then what conclusion are they going to come to? The process is necessary to secure a trillion dollar network. That's first and foremost.

The energy consumption of Christmas lights in the US equals that of the entire annual energy consumption of El Salvador. Here's a comparison with other activities ->




Now lets compare btc energy use against gaming ->




And then there's youtube  - same deal.

Bitcoin mining is location independent. It can consume energy at source with no transmission loss - and access stranded and excess power. You can see from that 2nd graphic how much more progress has been made in terms of renewables than other activities. That trend will continue as miners continue the pursuit of the cheapest possible energy sources available on the planet.

This BBC journo has been spreading 'bitcoin is finished' FUD since 2013.  I'd imagine that explains why his article represents one side of the energy use discussion. A global, permissionless, uncensorable, real-time final settlement system (which is what the bitcoin network is) has benefit.


----------



## RedOnion

jim said:


> I dont care a darn for Tesla.
> 
> My point is simply - Tesla's 1.5b investment must, at the moment, be breaking even at best? Wasnt it up 1bn at 1 stage.


No, it's still up.
As above, they purchased at an average of 34,200 USD. 
You obviously didn't buy until you heard Tesla had, so bought at a much higher price?


----------



## EmmDee

jim said:


> My bitcoin investment, which i made immediately sfter Tesla's investment, is currently worth less than what I invested. How does this make sense? Please discuss.



To be accurate... You bought just after Tesla announced in their quarterly filing that they HAD already bought BTC


----------



## jim

Yes fair points i bought at 35832 so not near as good as Tesla. Still though i would have thought that invesying at that rate so soon after Tesla's announcement would have meant i would be a bit ahead of the curve of the recent rally but im do


----------



## joe sod

WolfeTone said:


> Seriously though, we are in an era where there is a move towards converting to clean, renewable energy sources. Bitcoin is in the same boat as everyone. The earth is abundant with clean renewables, it is just a matter of investing in the technologies to harness all that clean energy.


yea the earth is full of clean renewables then why in the thousands of years of human civilasation we have only been able to harness a tiny proportion of it ? because its very difficult its spread out over the surface of the earth , all of our  technology is based on concentrated energy sources . Even with all the communications tech advancements, smart phones , computers etc we have barely made any inroads in energy technology. There is a reason for this,  Its very very difficult, you come against the laws of physics
I ask you a question why didn't Satoshi or whatever his name is not go and develop a revolutionary new energy technology rather than bitcoin. Bitcoin is afterall only an accounting system ,clever and all as it is, financial transactional technology would not be at the forefront of societal needs and then to cap it all he writes code just to consume loads of energy . What does all this energy consumed result in ? more food, more production, more vaccines, more transport, No it results in useless pussles solved and a new accounting token, Wow


----------



## WolfeTone

jim said:


> Yes fair points i bought at 35832 so not near as good as Tesla. Still though i would have thought that invesying at that rate so soon after Tesla's announcement would have meant i would be a bit ahead of the curve of the recent rally.



You were ahead of the curve. The price subsequently rose to $57k, a >50% increase, if you are quoting $ amounts.


----------



## WolfeTone

joe sod said:


> because its very difficult its spread out over the surface of the earth , all of our technology is based on concentrated energy sources . Even with all the communications tech advancements, smart phones , computers etc we have barely made any inroads in energy technology. There is a reason for this, Its very very difficult, you come against the laws of physics



True, but as discussed in a link to YT video, the object has always been to bring the energy source to people - oil, gas from remote areas to populated areas. Its not easy for sure.
But instead of bringing the clean renewable energy source to populated areas for bitcoin mining, why not bring bitcoin mining to the energy source?


----------



## Duke of Marmalade

Just Sunday musing.  

The reward for "mining" (what a euphemism  ) was originally set by Satoshi at 50 btc.  At the going rate of 5,000 btc per pizza this was about 20c per block.  Satoshi thought it good enough, after all I could do a bit of mining at home in the background on my laptop.  Today the reward is c.$300,000 per block.  (28/02/21 - I date stamp this as it will be wildy wrong within a few days).
So the nonsense consumption of electricity is driven by the price of btc.  After a few halvings and the next couple of burst bubbles mining rewards will be negligible, the mining rigs will be dismantled and folk like me can earn a few transaction fees from my laptop, just as Satoshi had designed it.

On Tesla and Musk.  Tesla has lost about $200bn of market cap since the announcement.  Makes the bitcoin pump profits of, say, $0.5bn look totally irrelevant.  Is the big reversal coincidental?  If I was a Musk fan (I am not) I certainly would not be impressed by this ego trip down crypto lane.


----------



## WolfeTone

Duke of Marmalade said:


> After a few halvings and the next couple of burst bubbles mining rewards will be negligible, the mining rigs will be dismantled and folk like me can earn a few transaction fees from my laptop, just as Satoshi had designed it



Is this the final path? The Ultimate Destination? The coming of _BOHA_ (although, not quite, you appear to signal bitcoin transaction fees could still be worth a few bob)? 

You could be right Duke, but your track record in predicting bitcoin demise is... not great, to be polite. 

You keep the faith, bitcoin will return to zero... notably you have extended the timeframe out to a 'few halvings'. 
We are talking about another decade then? Of bitcoin being up front and center a disruption to asset and financial markets, before _Hot Air Day Cometh!_?


----------



## Duke of Marmalade

WolfeTone said:


> You could be right Duke, but your track record in predicting bitcoin demise is... not great, to be polite.


Let's say that every time btc falls 10% I get it right.  So I do get it right quite a lot but for sure at this point I am a bit behind, but I am not disheartened.


----------



## WolfeTone

Duke of Marmalade said:


> Let's say that every time btc falls 10% I get it right.



Eh, no, sorry to disagree. 
Alternatively, if you want to change the parameters of _BOHA_ forecasts to 10% corrections, then that is fine. 
Welcome to the club, we have all been there. Your conversion from the darkside has begun .


----------



## tecate

joe sod said:


> yea the earth is full of clean renewables then why in the thousands of years of human civilasation we have only been able to harness a tiny proportion of it ? because its very difficult its spread out over the surface of the earth , all of our  technology is based on concentrated energy sources . Even with all the communications tech advancements, smart phones , computers etc we have barely made any inroads in energy technology. There is a reason for this,  Its very very difficult, you come against the laws of physics



Perfect. So you've identified that energy sources have never been a consideration in the establishment of population centres historically. Bitcoin mining can go to the source. They can be deployed temporarily and relocated easily in some instances. During rainy season in China, mining kit is run 5 months of the year to take advantage of surplus hydro energy and switched off outside of that timeframe. There are very few other activities that have that flexibility.



joe sod said:


> I ask you a question why didn't Satoshi or whatever his name is not go and develop a revolutionary new energy technology rather than bitcoin.


Who's to say that the global financial settlement system that he did create doesn't lead to advancements in energy technology?  As it stands, if one group of miners can source cheaper energy, then the rest won't be competitive. That's why those involved in the bitcoin mining industry are scouring the planet for the cheapest of power. That is always more likely to be excess renewable energy. The activity also subsidizes renewable energy production by allowing profitable use of energy that is produced at times when there simply isn't any need for it. Therefore, renewable projects that might otherwise be borderline in terms of profitability can become viable.



			
				joe sod said:
			
		

> financial transactional technology would not be at the forefront of societal needs. What does all this energy consumed result in ?


If you think that, then you've misunderstood the entire proposition. It's akin to suggesting that this internet thing, it's hardly at the forefront of societal needs. As for the energy use, it serves two purposes:
1. It's the energy standard that Henry Ford attempted to launch 100 years ago.
2. It provides for the most secure network that exists on the planet.


----------



## WolfeTone

tecate said:


> That's why those involved in the bitcoin mining industry are scouring the planet for the cheapest of power. That is always more likely to be excess renewable energy.



There it is. The 21st century gold-rush.


----------



## tecate

Duke of Marmalade said:


> So the nonsense consumption of electricity is driven by the price of btc.  After a few halvings and the next couple of burst bubbles mining rewards will be negligible, the mining rigs will be dismantled and folk like me can earn a few transaction fees from my laptop, just as Satoshi had designed it.


That electricity consumption provides for the electricity standard that Henry Ford tried to get off the ground 100 years ago and the most secure monetary network that exists on the planet. 
As regards 'as Satoshi had designed it' - no fundamental change has been made in the codebase relative to the way bitcoin is mined. The guy was exceptionally clever as he knew that there would be market cycles - and designed it so as the difficulty rate adjusts accordingly.


Duke of Marmalade said:


> On Tesla and Musk.  Tesla has lost about $200bn of market cap since the announcement.  Makes the bitcoin pump profits of, say, $0.5bn look totally irrelevant.  Is the big reversal coincidental?  If I was a Musk fan (I am not) I certainly would not be impressed by this ego trip down crypto lane.


At the time of writing this post, Tesla/Musk is up 27% on its btc investment. Bear in mind we're talking about a very short timeframe.


----------



## Duke of Marmalade

tecate said:


> That electricity consumption provides for the electricity standard that Henry Ford tried to get off the ground 100 years ago and the most secure monetary network that exists on the planet.


This is absolute nonsense   The following quote explains what electricity backed currency is.


			
				Wiki said:
			
		

> Let's suppose it was decided that each dollar should be backed by exactly 5 kilowatt-hours of electricity. In other words, for every dollar you own, you are guaranteed at least 5 kWh of electricity.


It was intended to be a guarantee from the central government that your currency could buy a fixed amount of electricity rather than a fixed amount of gold. Clearly Henry was convinced that a currency needed intrinsic backing.
A bitcoin is a "guarantee" that you have burnt up gazillions of energy not that you are guaranteed access to that wasted electricity.
But my dear @tecate you didn't come up with this brainwave on your own.  It is straight out of the cult's handbook as they embrace their own Old testament prophet, Henry Ford.
Anyway, can you make up your mind?  In in #342 you seem to be talking down the significance of the electricity consumption of bitcoin whilst you now hail it as having almost biblical prophetic meaning.
The landing place for bitcoin, if it doesn't crash and burn before hand, will be that the only remuneration of the "miners" will be transaction fees.  So the economics of mining will be transformed.  The centralised mining rigs would no longer be viable and the maintenance of the blockchain would become decentralised at much lower energy consumption as the good Satoshi planned it.


----------



## tecate

Duke of Marmalade said:


> This is absolute nonsense   The following quote explains what electricity backed currency is.


I disagree.



			
				Duke of Marmalade said:
			
		

> It was intended to be a guarantee from the central government that your currency could buy a fixed amount of electricity rather than a fixed amount of gold.


Here you refer to central government - Ford wanted to take that out of the hands of central banks and central governments. They frustrated him in his efforts and he had to abandon his plan. That's because the manner in which his plan was structured meant that he needed their approval - it was a sitting duck.  Bitcoin mining isn't a sitting duck - it can't be suppressed as that suppression would turn into a game of whack-a-mole.



			
				Duke of Marmalade said:
			
		

> Clearly Henry was convinced that a currency needed intrinsic backing.


Henry was convinced that gold was being manipulated by central banks and central governments - facilitating governments and kings in funding wars and vanity projects that were not in the interests of the average citizen.



			
				Duke of Marmalade said:
			
		

> Clearly Henry was convinced that a currency needed intrinsic backing.
> But my dear @tecate you didn't come up with this brainwave on your own.  It is straight out of the cult's handbook as they embrace their own Old testament prophet, Henry Ford.


The irony - this from the guy who has unquestioning support for government issued money - when the preeminent fiat currency in the world features the words 'In God We Trust' on its notes!



			
				Duke of Marmalade said:
			
		

> Anyway, can you make up your mind?  In in #342 you seem to be talking down the significance of the electricity consumption of bitcoin


Where is the confusion? I've clearly stated that along the same lines of what Henry Ford wanted to achieve, bitcoin is that updated energy standard. The difference is that it converts surplus energy directly into hard money. That energy increasingly comes from renewable sources - and furthermore, it is surplus. Bitcoin miners can locate themselves at source - even if that is in the back of beyond. They don't compete with other energy users as they are the buyers of last resort.



			
				Duke of Marmalade said:
			
		

> Clearly Henry was convinced that a currency needed intrinsic backing.
> The landing place for bitcoin, if it doesn't crash and burn before hand, will be that the only remuneration of the "miners" will be transaction fees.  So the economics of mining will be transformed.  The centralised mining rigs would no longer be viable and the maintenance of the blockchain would become decentralised at much lower energy consumption as the good Satoshi planned it.


I've never heard anyone ever suggest that Satoshi didn't plan this - you're the first to do so. However, that excludes this last part where you suggest that it's going back to home mining rigs. That's not going to happen. The reason it's not going to happen is that year on year, bitcoin's network effect continues to expand. Over the course of these discussions here, that's what has been happening.


----------



## Duke of Marmalade

@tecate it is just beyond belief that you or anybody else would believe that the consumption of energy in mining bitcoin is the fulfillment of Henry Ford's vision of a currency backed by an entitlement to *as yet unused *energy.  Frankly I don't think you could possibly believe that but in time worn fashion you will never backtrack from a clearly untenable position.

For avoidance of doubt I am not one of the knockers of bitcoin on the grounds of the enormous amounts of electricity it uses but I am with Yellen that it is an unbelievably inefficient way to verify a ledger, notwithstanding that decentralisation is inherently inefficient.  But, as I say, when the totally artificial rewards for mining new bitcoin vanish for one reason or another and the only revenue for the keepers of the ledger are transaction fees then the electricity consumption will fall from that of the Netherlands to, say, that of Kinnegad.  The fate of the planet is not in the hands of bitcoin.


----------



## tecate

Duke of Marmalade said:


> @tecate it is just beyond belief that you or anybody else would believe that the consumption of energy in mining bitcoin is the fulfillment of Henry Ford's vision of a currency backed by an entitlement to *as yet unused *energy.  Frankly I don't think you could possibly believe that but in time worn fashion you will never backtrack from a clearly untenable position.


Just to dispel that notion, this is very much my thinking.  There's nothing 'untenable' about my position. Bitcoin converts (increasingly surplus renewable...) energy into hard money directly. It doesn't exist without that input.
It's a position within which -  over 4 years - has acknowledged a whole host of shortcomings as related to bitcoin - and an acknowledgement that bitcoin could potentially fail. I don't have a fixed position on that - it's something that I think should be under continual review. However, the current outlook suggests bitcoin's continued growth and maturation is becoming increasingly likely.



Duke of Marmalade said:


> For avoidance of doubt I am not one of the knockers of bitcoin on the grounds of the enormous amounts of electricity it uses but I am with Yellen that it is an unbelievably inefficient way to verify a ledger.


Different discussion topic. I believe Yellen to be behind the curve in her assessment of bitcoin.



			
				Duke of Marmalade said:
			
		

> But, as I say, when the totally artificial rewards for mining new bitcoin vanish for one reason or another and the only revenue for the keepers of the ledger are transaction fees then the electricity consumption will fall from that of the Netherlands to, say, that of Kinnegad.  The fate of the planet is not in the hands of bitcoin.



The fate of the planet was never in the hands of bitcoin - that's a completely false narrative - just like Nouriel's Tether/Bitfinex claim (that Tether would bring down bitcoin) was a false narrative.


----------



## WolfeTone

Duke of Marmalade said:


> I am with Yellen that it is an unbelievably inefficient way to verify a ledger



Maybe, but its the most efficient way to verify a _trustless_ ledger. All other ledgers, 'verified', still require a large dollop of trust.



tecate said:


> I believe Yellen to be behind the curve in her assessment of bitcoin.



Me too, that's why I call her out to give bitcoin her endorsement at some point. But not before she reveals her own skin in the game. Others think she will never convert her views, but can she be trusted?


----------



## Duke of Marmalade

WolfeTone said:


> Maybe, but its the most efficient way to verify a _trustless_ ledger. All other ledgers, 'verified', still require a large dollop of trust.





> To get a better perspective of these numbers, the total electricity consumed by XRP can power fifty houses in the US whereas Bitcoin can do so for about 3 million homes.


----------



## tecate

@Duke of Marmalade - that's not a reasonable comparison at all. XRP is a centralised token - it couldn't in any way be compared to the  global, permissionless, uncensorable, real-time final settlement system that is bitcoin.

I'm not saying that it can't find a use case - but I am saying that you're comparing apples with oranges.  And of course, I maintain that this feigned energy use outrage is shambolic - so lets get past that from the get go - and not try and unreasonably demonise bitcoin on that basis.


----------



## Duke of Marmalade

@tecate okay, I'm prepared to admit that I might be wrong, it was just the first hit I got on Google and in any case if bitcoin is bigger than the Netherlands surely that is more than 3 million US homes.
@WolfeTone do you agree with @tecate that bitcoin is delivering on Henry Ford's vision of a currency backed by an entitlement to future use of electricity?


----------



## tecate

Duke of Marmalade said:


> @tecate okay, I'm prepared to admit that I might be wrong, it was just the first hit I got on Google and in any case if bitcoin is bigger than the Netherlands surely that is more than 3 million US homes.


I'm not saying that bitcoin isn't energy intensive - quite the opposite, I'm saying that it is. I'm saying that there's a false narrative at play with the suggestion that its energy use serves no purpose - that's incorrect.


Duke of Marmalade said:


> @WolfeTone do you agree with @tecate that bitcoin is delivering on Henry Ford's vision of a currency backed by an entitlement to future use of electricity?



You'll have to ask him something that i stated rather than something that i didn't claim. My claim is that bitcoin mining converts energy directly into hard money. That's the conversion that takes place. Afterall, nobody denies that there isnt that energy input. The 'future use' is as hard, uncensorable money.


----------



## WolfeTone

Duke of Marmalade said:


> @WolfeTone do you agree with @tecate that bitcoin is delivering on Henry Ford's vision of a currency backed by an entitlement to future use of electricity?



I couldn’t say, all I can image as a currency backed by electricity is those handled held electric shock zappers that featured in comic books and cartoons when growing up.


----------



## Duke of Marmalade

tecate said:


> I'm not saying that bitcoin isn't energy intensive - quite the opposite, I'm saying that it is. I'm saying that there's a false narrative at play with the suggestion that its energy use serves no purpose - that's incorrect.
> 
> 
> You'll have to ask him something that i stated rather than something that i didn't claim. My claim is that bitcoin mining converts energy directly into hard money. That's the conversion that takes place. Afterall, nobody denies that there isnt that energy input. The 'future use' is as hard, uncensorable money.


Nothing to do with uncle Henry's vision, I'm afraid.  Any way you will note that the good _theo_ attempted to joke his way out of the unavoidable answer to a direct question. I can see how prosecuting attorneys must feel with a hostile witness


----------



## tecate

Duke of Marmalade said:


> Nothing to do with uncle Henry's vision, I'm afraid.


I disagree. It has everything to do with Henry Fords vision. He identified that gold had been centralised by the powers that be - and manipulated by them. He attempted another approach - albeit he didn't have the likes of bitcoin as an option back then. There was a degree of centralisation to that plan and it is that which became the attack vector to bring his plan tumbling down.
Bitcoin has a very clear energy input - that's undeniable. It's a conversion from that energy directly into hard money.


Duke of Marmalade said:


> Any way you will note that the good _theo_ attempted to joke his way out of the unavoidable answer to a direct question. I can see how prosecuting attorneys must feel with a hostile witness


I respect your opinion on this - as I do that of Wolfie. I just don't agree with your opinion.


----------



## WolfeTone

Duke of Marmalade said:


> Any way you will note that the good _theo_ attempted to joke his way out of the unavoidable answer to a direct question. I can see how prosecuting attorneys must feel with a hostile witness



Ah jeez, you sprung that one on me and I gave my initial reaction. Tbh, I'm not au fait with Henry Fords theory of money backed by electricity. I may sit down and give it some reading one day, but alas, for the purposes of this discussion I neither provide supporting evidence for the plaintiff nor the defence at this point.


----------



## Duke of Marmalade

WolfeTone said:


> Ah jeez, you sprung that one on me and I gave my initial reaction. Tbh, I'm not au fait with Henry Fords theory of money backed by electricity. I may sit down and give it some reading one day, but alas, for the purposes of this discussion I neither provide supporting evidence for the plaintiff nor the defence at this point.


Your honour, this is a key witness. I put it to him that a promise of entitlement to future electricity is not the same as an assertion that the electricity has already been consumed and he protests that he is not familiar with HF theory.  I will produce witnesses that show that this republican, leftie, woke, nigh eve gentleman is in fact in thrall to @tecate and that abomination that calls itself bitcoin and I put it to the jury that he will never testify against the accused. I made a mistake calling him to the stand.


----------



## WolfeTone

Ok, so im dipping my toe in. @Duke of Marmalade its not looking good for you from the get-go.

For a moment, forget all about bitcoin and focus on what HF had to say in 1921 about a currency backed by electricity.

Ford would replace Gold with Energy Currency and Stop Wars

"_The essential evil of gold in its relation to war is the fact that it can be controlled. Break the control and you stop war._"

This type of language sound familiar in 2021?

What could he mean? It seems quite obvious what he wants - end of war (don't we all), but he is quite forthright in the causes of war. At which I am minded to refer, once again, to Professor Fergusons "_Ascent of Money_" series, which for anyone who has watched it will pick up on the common theme of money being the ever pervasive factor in war.
We all already knew that of course, but for many including myself history is generally taught in terms of blurred contradictions, clashing ideologies, hero's and villains of the battlefield upon which flags are raised and then honored - a means of human communication invoking common collective will and interest across space and time.

Rarely do the bankers get a mention. Or rather their pervasive control on the money supply, and in HF's time, then money supply was backed by gold.

So its not so obvious for simple folk like me, what he means by ending the control of the gold supply in the hands of international bankers, insofar as _how _the control can be ended. And its not yet, so obvious to me how he considered electricity could do this.
Nevertheless, from a pure observation and considering electricity is available to all but the most destitute or remotest regions of earth, there is something definitely to be considered about how electricity, as a money supply has merit.

From my perspective, he appears to envisage electricity as a means to providing greater autonomy to the population - in time inducing greater prosperity. In the article he talks, quite rightly, of a new era of civilisation;

"_Almost everyone in the world except the newspapers and the bankers recognizes that civilisation has entered on a new era"...._hard to disagree?

I'm pondering here, it will take time to get an overall sense of what HF was talking about and what @tecate has introduced to discussion. It has opened another level, particularly as I am recorded as having raised my concerns about the energy use of bitcoin.

Speaking of bitcoin, and considering the above I am minded to something I wrote a few months back that resonates with me somewhat.
Back in November 2020 I wrote;

"_ I would consider bitcoin having the prospect of being a great equaliser. Acting as a bulwark against manipulation (human nature) and offering economic opportunity and autonomy to anyone with an internet connection._"

The Bitcoin threads could be interesting in the future page 7 #139

I won't pretend that me and HF were on the same page distanced only by space and time, but Im only dipping my toe and I sense a linkage there.


----------



## tecate

WolfeTone said:


> Ford would replace Gold with Energy Currency and Stop Wars


The article continues on pg.6 where Ford is quoted as stating:

_"Under the currency system, the standard would be a certain amount of energy *exerted* for one hour that would be equal to one dollar"._

Bitcoin is digital money for a digital era and so naturally enough its design differs. However, in terms of expended energy being transformed into hard money, how are they not similar?


----------



## Duke of Marmalade

Oh dear. I fear the thread has not only lost all common sense it has also lost its sense of humour.  HF was referring to entitlement to future electricity as a backing for currency not to the electricity used in creating it. @WolfeTone, I am not asking you (no point) I am telling you.
You have pivoted the discussion to bitcoin the crusade against war mongering central bankers, a favourite playground of Big Short.  A bit of an irony that the engine of this crusade is centralised in Russia, China and Belarus.


----------



## joe sod

Totally different because ford's vision was a currency backed by future energy consumption to be used for useful goods not consumed by computers to produce nothing but a virtual currency. I doubt satoshi envisanged bitcoin getting to such levels that it consumed grotesque amounts of electricity. Is that not now the fundamental flaw in bitcoin becoming mainstream,  the code is stuck and the original creater is an enigma so can't be called upon to change this ridiculous impediment. Everything in life has to be changed as circumstances change but bitcoin is stuck with this ridiculous legacy.


----------



## WolfeTone

Duke of Marmalade said:


> Oh dear.


 Oh dear, indeed. After politely informing you that I was not au fait with HF theory, you persisted in your agent provocateur



Duke of Marmalade said:


> I will produce witnesses that show that this republican, leftie, woke, nigh eve gentleman is in fact in thrall to @tecate and that abomination that calls itself bitcoin and I put it to the jury that he will never testify against the accused.



conveniently edited



Duke of Marmalade said:


> I made a mistake calling him to the stand.



Once again, your penchant to dismiss that which does not agree with your narrative comes to the fore. Quite simply Duke, I have no real grasp of what HF was suggesting with his theory. My limited knowledge on this is there to see. All I know, is that when I did dip my toe in the matter, the very first thing I came across was a newspaper article citing the esteemed HF.



Duke of Marmalade said:


> HF was referring to entitlement to future electricity as a backing for currency not to the electricity used in creating it



I'm not disputing this for a moment, but what appears to be ever lacking is any understanding of _why _HF wanted to do this? There was gold, there was the dollar, backed by gold standard - what was HF's beef? What was the problem he was trying to fix?


----------



## Duke of Marmalade

WolfeTone said:


> I'm not disputing this for a moment, but what appears to be ever lacking is any understanding of _why _HF wanted to do this? There was gold, there was the dollar, backed by gold standard - what was HF's beef? What was the problem he was trying to fix?


_Wolfie_ the HF meme is an interesting one and maybe worthy of a separate topic.  But what I am taking issue with is the claims by the bitcoin community that bitcoin is delivering on his vision.  The words "electricity" and "currency" are common but I hope I have got a little nearer to convincing you that bitcoin and in particular its massive consumption (as opposed to production) of electricity do not in any way fulfill that role.  It is the readiness of the cult to grab any hype whether valid or not that is telling.


----------



## WolfeTone

joe sod said:


> I doubt satoshi envisanged bitcoin getting to such levels that it consumed grotesque amounts of electricity



Perhaps, and perhaps that is why s/t/he/y have disappeared?



joe sod said:


> Is that not now the fundamental flaw in bitcoin becoming mainstream, the code is stuck and the original creater is an enigma so can't be called upon to change this ridiculous impediment.



Dear Joe, you can quote me several times raising the spectre of the energy usage of bitcoin. You can quote me several times in stating that bitcoins demise will occur once a fundamental flaw is discovered, or if a newer technology does what bitcoin does (or supposed to do), but even better.

On the other hand, now that this fundamental flaw has been uncovered by yourself and others, surely the unravelling of the bitcoin phenomenon is imminent?

Or is there another side to the tale?

The _BOHA _, so prevalent in earlier discourses appears to have waned somewhat from the lexicon of no-coiners.
The _Its only used by criminals _still gets an airing occasionally, usually by new-commentators to the sector, playing a bit of catch-up
The _Tether FUD, _has unraveled and returned to zero value once the fundamental flaw in that theory was exposed.

So surely now, aside from the faithfuls like myself, the unraveling of bitcoin with this fundamental flaw is imminent?


----------



## WolfeTone

Duke of Marmalade said:


> what I am taking issue with is the claims by the bitcoin community that bitcoin is delivering on his vision



Aye, but _I_ have never proclaimed that bitcoin is delivering on his vision. You cast your line in my direction hoping to hook a fish, instead you got tangled in a disused shopping trolley .
I don't entirely understand what HF's vision was, I get a sense of it. How it would function in practical terms I have no idea.

Energy consumption is one thing, consumption of climate-changing fossil fuels v clean renewables is another thing.
If bitcoin were to consume 100% carbon-emission free, clean, renewable energy, what odds how much energy it consumed?

As tecate has mentioned



tecate said:


> That's why those involved in the bitcoin mining industry are scouring the planet for the cheapest of power. That is always more likely to be excess renewable energy.



There is a clear impetus in bitcoin mining, for sourcing clean renewable energy.


----------



## tecate

Duke of Marmalade said:


> HF was referring to entitlement to future electricity as a backing for currency not to the electricity used in creating it. @WolfeTone, I am not asking you (no point) I am telling you.





joe sod said:


> Totally different because ford's vision was a currency backed by future energy consumption to be used for useful goods not consumed by computers to produce nothing but a virtual currency.


Could one unit of HFs new currency be redeemed for the equivalent in electricity?

@Joe - you're struggling with this but the energy input doesn't produce nothing. It provides for the security of what is the most secure monetary network in existence. There is more energy being expended with people watching cat videos on youtube today than on btc mining yet no feigned outrage on that front.



Duke of Marmalade said:


> A bit of an irony that the engine of this crusade is centralised in Russia, China and Belarus.


Another piece of FUD that has been outed. Bitcoin mining could be more optimally distributed, yes - but what you're referring to does not provide a sufficient attack vector to be detrimental to bitcoin.



joe sod said:


> I doubt satoshi envisanged bitcoin getting to such levels that it consumed grotesque amounts of electricity.


Both of you have claimed this but it's wayward. I've never seen anyone else suggest this here or elsewhere. There isn't any possibility that he didn't foresee increased energy consumption levels. He planned for it and designed it in.



joe sod said:


> Is that not now the fundamental flaw in bitcoin becoming mainstream,  the code is stuck and the original creater is an enigma so can't be called upon to change this ridiculous impediment. Everything in life has to be changed as circumstances change but bitcoin is stuck with this ridiculous legacy.


Except that it was designed in for a reason. Other than that, I agree that everything evolves over time. If you are suggesting that bitcoin has been usurped by a superior decentralised digital currency, what is that currency?



			
				joe sod said:
			
		

> Is that not now the fundamental flaw in bitcoin becoming mainstream


Are you suggesting that bitcoin is stopped in its tracks because of energy use - because I don't agree. This FUD is causing corporates some confusion when they consider ESG policy but that just represents a knowledge gap that needs to be bridged. It's a false narrative and decision makers will ultimately be well informed enough to push past it.


----------



## DublinHead54

WolfeTone said:


> There is a clear impetus in bitcoin mining, for sourcing clean renewable energy.



Bitcoin miners can't move their operations as freely and easily as BTC moves around the world. 

Is there not a recognition that Bitcoin miners are organizations seeking a profit that are tied to their locations / borders / government policy? The owners of the Chinese mining operations can't just pick up and move to Iceland if there is cheaper renewable energy.


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## WolfeTone

Dublinbay12 said:


> The owners of the Chinese mining operations can't just pick up and move to Iceland if there is cheaper renewable energy.



No, they can't. But Icelandic mining operations can.


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## joe sod

@tecate you claim that corporates are unable to understand the conflict between bitcoin mining and their ESG requirements now. I contend that they understand it perfectly well and that the bitcoin enthusiasts also understand it perfectly well that is why they are trying so hard to tie bitcoin to renewable energy now. However Satoshi did not and could not foresee that the energy consumption requirements of bitcoin if it reached a certain level would be unacceptable. He could not and did not foresee it in the age of greta  thornberg and ESG that was not on the horizon in 2008. Satoshi while he maybe an enigma is not a god.


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## Duke of Marmalade

tecate said:


> Could one unit of HFs new currency be redeemed for the equivalent in electricity?


That is my understanding.  In fact the real zealots wanted its name changed from the dollar to the Kw/hr.  There was even a theory that since energy was becoming more and more efficient in producing goods and services there would be an inbuilt appreciation in the currency against a basket of goods and services.  Now IMHO that is not a good thing for a currency.  As to whether it would have prevented WWII, I would not like to speculate.
You reminded me earlier on in this thread of Nouriel's big faux pas, his overestimate of the Tether issue.  It was a big, big let down for all his fans including yours truly.  Not that Tether come out as crusaders in pursuit of the end of all wars ala prophet Henry.
Nouriel's main tenants remain intact.  Btc is not a currency.  It is not a medium of exchange.  It is not a unit of account.  It is not a numeraire.  It is not a store of value.  It is a bubble.  I know its repetitive but no apologies.


----------



## tecate

WolfeTone said:


> No, they can't. But Icelandic mining operations can.


Bitcoin mining is now a big business in its own right. There are entities with operations in different world regions. Even if relocation is an issue for one company, it makes no difference. If they get out of the business, they create an opportunity for someone else to enter the market elsewhere.


joe sod said:


> @tecate you claim that corporates are unable to understand the conflict between bitcoin mining and their ESG requirements now. I contend that they understand it perfectly well and that the bitcoin enthusiasts also understand it perfectly well that is why they are trying so hard to tie bitcoin to renewable energy now.


That's not what I said. With the upsurge in the market, the same old tired arguments are being dragged out once again.  Included amongst them is this claim that bitcoin is boiling the oceans. It's in response to that - that corporates are currently considering bitcoin relative to ESG policy.
Consider this. Tesla attracts an environmentally conscious customer base and to my point, it could get past this complete FUD and put btc on its balance sheet. If it can, then this false environmental narrative isn't going to be the reason others don't.



			
				joe sod said:
			
		

> . However Satoshi did not and could not foresee that the energy consumption requirements of bitcoin if it reached a certain level would be unacceptable. He could not and did not foresee it in the age of greta  thornberg and ESG that was not on the horizon in 2008. Satoshi while he maybe an enigma is not a god.


That's complete rubbish. There's no earthly way that he didn't foresee the energy consumption requirement when you consider that he designed it in! As regards consideration of energy use back then, it's quite the opposite. Back then the narrative was that we were about to run out of oil. Nobody talks about that now (as fracking technology came along).



Duke of Marmalade said:


> That is my understanding.


Based on what?  Can you please provide a link to the info that has led you to that understanding?


----------



## Duke of Marmalade

tecate said:


> Based on what?  Can you please provide a link to the info that has led you to that understanding?


It is difficult to get detail on Henry's proposal.  This short article in Chapters 5 and 6 makes it clear that the currency could be exchanged for electricity rather than it was produced by electricity.
Why is the community to shoehorn this false narrative of fulfillment of the vision of prophet Henry?


----------



## WolfeTone

Duke of Marmalade said:


> Chapters 5 and 6 makes it clear that the currency could be exchanged for electricity rather than it was produced by electricity



Forgive me for being so naive here, but isnt that what we do today? The electricity people supply my household with electricity in exchange for my €'s. 

I'm not sure that is what HF had in mind.


----------



## Duke of Marmalade

WolfeTone said:


> Forgive me for being so naive here, but isnt that what we do today? The electricity people supply my household with electricity in exchange for my €'s.
> 
> I'm not sure that is what HF had in mind.


No, no, it is quite different.  You don't know what the electricity people are going to charge you in €s in the future.  If, heaven forbid, the ECB were to print a trillion of € it might be that the electricity people would demand more of them!

It is an interesting idea.  By definition your currency would keep pace with the price of electricity.  On the front (or back) of your kw/h note it would say _"I promise to supply you with x kw/h on presentation of this note"_, signed _The Duke of Marmalade,  President of the Electricity Currency Board_.
That might actually be deflationary if other goods and services become cheaper than electricity to produce.

I can see lots of practical pitfalls but in any case I think the current arrangement is superior where the central bank has a price target in terms of all goods and services and not rigidly to just one.

Of course, 100 years ago it would have been extremely farseeing of Henry to appreciate that a currency does not actually need an intrinsic backing, and he didn't appreciate it.


----------



## WolfeTone

Yes, I get that @Duke of Marmalade , what I don't get is why?
The gold standard already existed and performed the function that HF was proposing with electricity?
What was he trying to resolve that the gold standard could not? 

There is something else at play with HFs idea. He spoke of the "electrification of everything". 

In the "electrification of everything", HF is, to my mind, tapping into a different concept than the gold standard. A concept where everybody has access to the supply to generate their own income (or not) from their own endeavour. Kind of what we have now, but prices measurable in the electric standard. There would be no redeeming your currency for electricity as everyone will have access to the supply of electricity, unlike the supply of gold.


----------



## Duke of Marmalade

WolfeTone said:


> Yes, I get that @Duke of Marmalade , what I don't get is why?
> The gold standard already existed and performed the function that HF was proposing with electricity?
> What was he trying to resolve that the gold standard could not?
> 
> There is something else at play with HFs idea. He spoke of the "electrification of everything".
> 
> In the "electrification of everything", HF is, to my mind, tapping into a different concept than the gold standard. A concept where everybody has access to the supply to generate their own income (or not) from their own endeavour. Kind of what we have now, but prices measurable in the electric standard. There would be no redeeming your currency for electricity as everyone will have access to the supply of electricity, unlike the supply of gold.


Ostensibly it was to stop wars. He argued that all wars were because of the gold standard as it made gold a strategic asset and therefore encouraged geopolitical struggle for control of it.  He argued that most countries in the world had autonomous access to electricity supply and there could not be geopolitical domination of that resource. 
I don't think I go along with his argument or even fully understand it.  I am sure gold started wars but then by 1939 we were off the gold standard.


----------



## WolfeTone

Duke of Marmalade said:


> He argued that most countries in the world had autonomous access to electricity supply and there could not be geopolitical domination of that resource.



Indeed, but I think he was going further. Not only autonomous access at nation states level, but right down to the individual - "_a new era of civilisation_".


----------



## tecate

Duke of Marmalade said:


> Nouriel's main tenants remain intact.  Btc is not a currency.  It is not a medium of exchange.  It is not a unit of account.  It is not a numeraire.  It is not a store of value.  It is a bubble.  I know its repetitive but no apologies.


Nouriel has been wrong about bitcoin at every point between $13 dollars and $50,000. If NYU had any sense, they'd pay him his severance and be done with him.  


Duke of Marmalade said:


> It is difficult to get detail on Henry's proposal.  This short article in Chapters 5 and 6 makes it clear that the currency could be exchanged for electricity rather than it was produced by electricity.
> Why is the community to shoehorn this false narrative of fulfillment of the vision of prophet Henry?


It's not from Henry Ford's scheme but no matter. Whether it was based on input or an actual claim on energy, my view remains the same. I recognise the energy input whereas you choose not to. We'll park it up at that.


Duke of Marmalade said:


> Of course, 100 years ago it would have been extremely farseeing of Henry to appreciate that a currency does not actually need an intrinsic backing, and he didn't appreciate it.


The very same as you did with Satoshi, you're trying to contrive their views to meet your own narrative. We know that he understood the conventional system to be crooked based on what he stated. We know that the centralised aspect of his scheme led to the powers that be frustrating his efforts.


----------



## DublinHead54

WolfeTone said:


> No, they can't. But Icelandic mining operations can.



So mining is a zero sum game? If that be the case why is any mining done in china today when cleaner energy sources are available in other locations?


----------



## WolfeTone

Dublinbay12 said:


> If that be the case why is any mining done in china today when cleaner energy sources are available in other locations?



I don't know, probably something to do with economic viability? 
Cleaner energy sources are one thing, cheaper energy sources are another. 
Probably a reason why China has is competing with the US as the largest manufacturing country in the world - cheap, albeit dirty energy sources.


----------



## DublinHead54

WolfeTone said:


> I don't know, probably something to do with economic viability?
> Cleaner energy sources are one thing, cheaper energy sources are another.
> Probably a reason why China has is competing with the US as the largest manufacturing country in the world - cheap, albeit dirty energy sources.



Ok thanks for recognising BTC mining isn't a zero sum game.


----------



## DazedInPontoon

In my view it *is* a zero sum game, since the mining reward is fixed regardless of the number of miners or how much energy they are choosing to expend.

If miners are mining in China it's because they have a good reason to do so. It might be access to energy that is cheaper, or as cheap, as  elsewhere, or it could be be because they have more efficient hardware than other miners and enough reasons not to re-locate where energy is cheaper.


----------



## DublinHead54

DazedInPontoon said:


> In my view it *is* a zero sum game, since the mining reward is fixed regardless of the number of miners or how much energy they are choosing to expend.
> 
> If miners are mining in China it's because they have a good reason to do so. It might be access to energy that is cheaper, or as cheap, as  elsewhere, or it could be be because they have more efficient hardware than other miners and enough reasons not to re-locate where energy is cheaper.



I was referring to the indications that BTC mining is fungible and will move to the cleanest energy sources. I am referring to statements made on here about BTC mining hardware going to remote parts of Russia and the network operating almost as not for profit. 

There is an economic benefit from mining and those running the mining operations have an economic benefit to maintain their mining operation in China. As one poster mentioned, the chinese military could not even stop these mining operations, so I doubt a few Greta Thunbergs could either. 

The rhetoric on here at times is that BTC network transcends human nature and economics, which I believe is a misguided belief. The proof is in the pudding so to speak as all the touted alternative mining solutions posted here have not done anything to democratize the mining power away from a centralized operation out of china.


----------



## DazedInPontoon

The economics of mining are such that generally, in the long run, the most efficient miners will put all other miners out of business - by which I mean the less efficient miners have the choice of not mining, or spending more to mine than they make.

If energy is actually significantly cheaper in Iceland than everywhere else, and there are no significant additional operational overheads to mining there, then over time the Iceland miners should increase their mining capacity until it's close to the point that it is no longer profitable to do so. If they do this then it is no longer profitable to mine elsewhere. At this point the Chinese miners have three choices:
- move to Iceland.
- exit mining and sell their equipment to Icelandic miners (so the mining moves to Iceland in this case too)
- continue mining at a loss in China.

This is a simplified view, and in reality there is more nuance that may mean miners do not do what is most efficient for them of course.


----------



## joe sod

WolfeTone said:


> I don't know, probably something to do with economic viability?
> Cleaner energy sources are one thing, cheaper energy sources are another.
> Probably a reason why China has is competing with the US as the largest manufacturing country in the world - cheap, albeit dirty energy sources.


That proves the point though that cheap green energy sources are not plentiful. Most of the bitcoin is done in China using dirty means as is most manufacturing,  but at least manufactured goods are useful, essential products that by and large we can't do without,  bitcoin is not essential,  we can live perfectly well without it.
Surely we should be using green energy like in Iceland for essential useful product,  surely using icelandic energy to split water for hydrogen production rather than bitcoin is where we should be at. Bitcoin is just an artificial accounting token not an essential good


----------



## Duke of Marmalade

joe sod said:


> Bitcoin is just an artificial accounting token


You flatter it.  Bitcoin is a Bag Of Hot Air using gazillions of electricity to stay Hot.


----------



## tecate

joe sod said:


> That proves the point though that cheap green energy sources are not plentiful.


If you think that there isn't enough available to power the bitcoin network, that's an issue for those concerned with the network then. Let those stakeholders worry about that.



joe sod said:


> Most of the bitcoin is done in China using dirty means as is most manufacturing,


See the chart I posted a couple of days ago. Bitcoin mining is in its infancy but already it has a far higher green energy concentration than other activities.



joe sod said:


> but at least manufactured goods are useful, essential products that by and large we can't do without,


Essential?  You mean all that cheap, plastic crap that is bunged into containers and sent to N.America and Europe? You say its essential? I say that the current monetary model encourages rampant consumerism - resulting in people buying a whole load of crap that there's no way in the world they need.  This - is at the heart of the energy debate - not bitcoin mining.
Over and above that, see my post from the weekend with the comparison of btc mining energy use vs. gaming. You talk about what is essential. How is gaming essential? It uses a hell of a lot more power than btc mining. Furthermore, btc mining is far more progressive in utilising far more green energy sources than gaming (and as far as I can see, most other activities).



joe sod said:


> bitcoin is not essential



I'm sure horse and cart owners said the same thing when car use was at an embryonic stage.



joe sod said:


> we can live perfectly well without it.


If you want this inequitable financial and monetary system to continue in its current form, that's your business. I don't. Henry Ford identified these shortcomings 100 years ago already. Change has been a long time coming.



joe sod said:


> Surely we should be using green energy like in Iceland for essential useful product,


What's this "we" business? How much have you invested in green energy infrastructure? Bitcoin mining is a tough business - that now requires major investment and a commitment to that business over the longterm (if those guys are ever going to see a return). They're stumping up their own money to fund these projects. Therefore, why should you have a say in that?
You can claim that its boiling the oceans yet anyone who claims that - do you see them calling for gaming to be outlawed? Do you see them calling for people to stop watching cat videos on youtube (youtube in isolation accounting for a horrendous amount of energy use)? Cat videos and gaming are essential too, right?....whereas the  global, permissionless, uncensorable, real-time final settlement system that is bitcoin isn't. Makes complete sense.

The reality is that the people who roll out this argument are diametrically opposed to bitcoin. If they weren't they would suggest we're ok with it if it uses wasted/stranded/renewable energy. But that's never the line that's taken.


----------



## tecate

Duke of Marmalade said:


> You flatter it.  Bitcoin is a Bag Of Hot Air using gazillions of electricity to stay Hot.


If you're going to vent Dukey, then let me throw in that over the course of each of the 4 years that you've come out with statements like that, the network effect of bitcoin has grown year on year.


----------



## WolfeTone

joe sod said:


> at least manufactured goods are useful, essential products that by and large we can't do without,



I would have to disagree. The vast, vast majority of manufactured goods are not essential and by and large we could do without.
For eg, I had a perfectly good working TV a couple of years back but there was an offer on a smartTV, with a larger screen etc, so I bought it. The old TV had no, to little resale value, so to the dump it went. Probably some octopuss or dolphin choking on its broken down parts now.
On a larger scale, after Covid, who could honestly say that all those air polluting foreign trips are 'essential'. Essential to the tourist industry, but not essential for the survival of the human species on planet earth.


----------



## DublinHead54

I came across this article today (Link), again highlighting the energy consumption of Bitcoin mining, what I found quite interesting is the comment below. So whilst people can harp on about BTC going to use renewable energy to mine nobody actually knows if they are or not. 

_'Since there is no government body or organization that officially tracks where bitcoin is being mined and what type of electricity miners are using, there is no way of knowing whether miners are using electricity that is fueled by renewable energy or fossil fuels.'_

This site is also useful




__





						Cambridge Bitcoin Electricity Consumption Index (CBECI)
					

The Cambridge Bitcoin Electricity Consumption Index (CBECI) provides a real-time estimate of the total electricity consumption of the Bitcoin network. The CBECI is maintained by the Cambridge Centre for Alternative Finance (CCAF) at Judge Business School, University of Cambridge.




					cbeci.org


----------



## tecate

DazedInPontoon said:


> The economics of mining are such that generally, in the long run, the most efficient miners will put all other miners out of business


Research has been cited on this thread which indicates a significant and ever increasing proportion of bitcoin mining relies on renewable energy sources. But the bottom line is as Dazed points out. We know that bitcoin mining is continuously pursing the cheapest energy on the planet - and that this process is unrelenting. Unwanted/excess/stranded renewable energy is the cheapest energy on the planet. Therefore, it's logical why we see a higher percentage of renewables in the bitcoin mining mix by comparison with gaming and other power hungry activities. Furthermore, it's also clear that bitcoin miners can only be buyers of last resort - if someone bids up the price, then that energy is going to be too costly for them. There is no competition for said energy with other users in those circumstances.


----------



## WolfeTone

Dublinbay12 said:


> 'Since there is no government body or organization that officially tracks where bitcoin is being mined and what type of electricity miners are using, there is no way of knowing whether miners are using electricity that is fueled by renewable energy or fossil fuels.'


So whilst people can harp on about BTC using fossil fuel energy to mine nobody actually knows if they are or not.


----------



## DazedInPontoon

Dublinbay12 said:


> So whilst people can harp on about BTC going to use renewable energy to mine nobody actually knows if they are or not.


I agree, but of course that also applies equally to people harping on about BTC not using renewable energy.

Additionally, while it may be difficult to actually verify 100% with your own eyes what miners are doing, we can listen to what they are telling us they are doing. For example one mining company GAM:


> Great American Mining monetizes wasted, stranded and undervalued gas throughout the oil and gas industry by using it as a power generation source for bitcoin mining. We bring the market and our expertise to the molecule. Our solutions make producers more efficient and profitable while helping to reduce flaring and venting throughout the oil and gas value chain.



Or you can read about Icelandic mining here and decide that they are probably lying, and that they're actually burning coal and I couldn't prove you wrong.


----------



## tecate

WolfeTone said:


> So whilst people can harp on about BTC using fossil fuel energy to mine nobody actually knows if they are or not.


Building on that further, we also don't know how much of that fossil fuel energy is simply wasted energy. i.e. if it wasn't being used to power bitcoin mining,  would it simply remain uncaptured?. Coal-based power generation stations are notoriously inefficient and have to be kept stoked and burning even in times when there is no demand from the grid.
We know that power companies directly have gotten involved in bitcoin mining on this basis. It makes complete sense that they would.


----------



## DublinHead54

WolfeTone said:


> So whilst people can harp on about BTC using fossil fuel energy to mine nobody actually knows if they are or not.





DazedInPontoon said:


> I agree, but of course that also applies equally to people harping on about BTC not using renewable energy.
> 
> Additionally, while it may be difficult to actually verify 100% with your own eyes what miners are doing, we can listen to what they are telling us they are doing. For example one mining company GAM:
> 
> 
> Or you can read about Icelandic mining here and decide that they are probably lying, and that they're actually burning coal and I couldn't prove you wrong.



Of course this is true and you are stating the obvious which I agree with. I'm not sure why I'm being attacked. 

There is nothing inaccurate in that article.


----------



## DublinHead54

tecate said:


> Building on that further, we also don't know how much of that fossil fuel energy is simply wasted energy. i.e. if it wasn't being used to power bitcoin mining,  would it simply remain uncaptured?. Coal-based power generation stations are notoriously inefficient and have to be kept stoked and burning even in times when there is no demand from the grid.
> We know that power companies directly have gotten involved in bitcoin mining on this basis. It makes complete sense that they would.


Are you saying that all fossil fuel usage for bitcoin mining is coming from surplus supply? 

You are over simplifying how electricity works, whilst fossil fuels bad an inefficient. Demand for electricity changes on the grid throughout the day, grid networks have to run surplus due to the time it takes to react to demand. If every coal plant across the world can be used to mine bitcoin that's great. Even with renewables there will be surplus in demand and there has been a rise in battery storage systems to smooth this out. So even with renewables there will be a surplus. 

Is this happening at scale? Or who is coordinating a move to mine BTC with surplus energy? It seems like a no brainer


----------



## WolfeTone

Dublinbay12 said:


> I'm not sure why I'm being attacked.



Who is "attacking" you?


----------



## DazedInPontoon

Dublinbay12 said:


> I'm not sure why I'm being attacked.


I quoted you in my post, but I didn't mean to attack you or that post specifically, but moreso the general FUD. Apologies.


----------



## DublinHead54

DazedInPontoon said:


> I quoted you in my post, but I didn't mean to attack you or that post specifically, but moreso the general FUD. Apologies.



I must have misunderstood FUD, which I believe is meant to be the spreading negative and false information. Everything in that article was factual and accurate. 

More generally what 'general FUD' are you referring to. 

This is the classic technique in this thread....when faced with a well written factual piece of unbiased information that is viewed as negative towards BTC the topic gets changed by attacking the poster or making erroneous inaccurate statements. 

I'd prefer if you just stuck to commenting on the actual post.


----------



## DazedInPontoon

As I said, I'd no problem with your post other than wanting to quote the line about no one knowing what energy sources miners are using to highlight that it applies to both side of the argument. I was agreeing with what you said.

I also had no problem with the article you linked,

In the context of the point about not knowing what energy source miners are using I probably should have found some other post to quote like:


joe sod said:


> Most of the bitcoin is done in China using dirty means


----------



## WolfeTone

Dublinbay12 said:


> thread....when faced with a well written factual piece of unbiased information



It wasn't the article, the article is fine.

It was your reference to some who "harp on" about renewables.
"Harp on" is euphemism for someone going on about something in an annoying manner. 
That is what you claimed. Those who talk about bitcoin and renewable energy are annoying. Which is quite odd, considering the article you linked suggests that no one really knows how much fossil fuel, or clean renewable energy is used for mining bitcoin.


----------



## DublinHead54

WolfeTone said:


> It wasn't the article, the article is fine.
> 
> It was your reference to some who "harp on" about renewables.
> "Harp on" is euphemism for someone going on about something in an annoying manner.
> That is what you claimed. Those who talk about bitcoin and renewable energy are annoying. Which is quite odd, considering the article you linked suggests that no one really knows how much fossil fuel, or clean renewable energy is used for mining bitcoin.



I guess I should have worded it as both sides of the argument harping on about the source of energy usage. Everything is superfluous and the only fact that we should agree on is that Bitcoin mining requires a large amount of energy consumption. Whether that is from renewable / spare capacity / fossil fuels does not reduce the baseline fact.


----------



## WolfeTone

Dublinbay12 said:


> Everything is superfluous and the only fact that we should agree on is that Bitcoin mining requires a large amount of energy consumption.



I don't think anyone here has ever disputed that? 
Bitcoin mining uses a lot of energy, so does the airline sector. 
Arguably most aeroplane flights that occur are driven mostly by consumer indulgence rather than necessity.


----------



## tecate

There is no justification for singling out bitcoin's energy use whilst ignoring that of other sectors. It's far too easy for media to crunch out a 'btc uses more energy than country x' click bait article. The BBC article which re-ignited this discussion here is a completely unbalanced piece from someone who called the downfall of btc in 2013. 
However, if people insist on forcing that debate, then the design of bitcoin as it relates to energy consumption needs to be noted...i.e. its designed such that miners are incentivised to seek out the cheapest energy on the planet to survive...and that will invariably be unwanted renewable energy. For that reason, we see a far more greener element to the btc mining mix than compared with other energy intensive activities.


----------



## DublinHead54

This is a discussion on BTC though, pointing out the usage energy of other sectors has nothing really to do with BTC energy usage.

Given it has been pointed out that the design of BTC is to use the cheapest energy source available 'unwanted renewable energy' why are we yet to see this happen at scale? When is it going to happen? I think this is a novel idea, but I've not actually seen much indication of that move happening.

I personally don't think the benefits of BTC justifies the energy consumption under the current adoption of BTC and the predominant use case as a store of value. You have to remember BTC was designed to be a decentralized currency, not a store of value lining the pockets of Wall Street.


----------



## WolfeTone

Dublinbay12 said:


> This is a discussion on BTC though, pointing out the usage energy of other sectors has nothing really to do with BTC energy usage.



True, but I am confused now as to why BTC, using alot of energy is an issue? 

I get that if it requires a lot of energy and that energy is sourced for fossil fuels polluting the planet, that is an issue. 

I don't get if it uses a lot of energy, and that energy is increasingly sourced from wasted fossil fuel energy, or clean renewable energy, why that would be an issue? 
The planet has an abundance of clean renewable energy sources. The difficulty is trying to harness that energy at affordable cost. I'm no expert but I understand there is a considerable capital investment at global public and private level in research and development into innovating technologies to do just that? 
And bitcoin miners have a clear incentive to source cheaper energy. 
So, like anything else, consumers and businesses will use the cheapest option. 
Overtime, these options will become less viable via higher prices, taxes, cheaper cleaner alternatives. 

Now I have to go. I need to go to the recycling plant to offload some waste in an environmentally friendly way.   
On the way back I will fill up my diesel car and buy a couple of bags of turf.


----------



## DublinHead54

WolfeTone said:


> True, but I am confused now as to why BTC, using alot of energy is an issue?


The energy usage is a fact. 

So I think that based on your comment your view is that BTC is viable if using renewable sources in the long run? What is your view on a central bank that is printing money using renewable energy sources? 

The difference here is that BTC miners are motivated by it being a cheaper source, wheras the Central banks are mandated by governments to move to renewable sources. So it is a fair assessment that if coal remained the cheaper source of energy that BTC miners would use that as the source? It has been pointed out here by @tecate in the context of chinese miners the government or even the military can do nothing towards them and thus could not enforce sanctions. 

I think given there is an unknown around how much BTC is mined by renewables and over time this may change by design and the mining centralization will decrease. However, I think those arguing on the opposite side should treat the established financial markets e.g. Central Banks as also being able to evolve as the world moves towards enhancing renewable energy supplies. 

I don't think it is fair to argue using future examples of BTC but not allowing for the same use of future landscapes in established markets. 

Whilst I continue to play an active role in the cryptocurrency community, I am less drawn towards BTC which has deviated too much from its original value. Broader the energy usage to maintain an asset that is making wall street rich regardless of the source I don't think is justifiable or what we originally wanted to achieve. 

I am not sure how people can justify the adoption of BTC by wall street as good for the community? Although it being good for our personal investments. I fear BTC will just become a commodity used to profit.


----------



## WolfeTone

Dublinbay12 said:


> The energy usage is a fact.



I have never disputed this. No-one has.



Dublinbay12 said:


> So I think that based on your comment your view is that BTC is viable if using renewable sources in the long run?



Yes, along with all other industries and sectors.



Dublinbay12 said:


> What is your view on a central bank that is printing money using renewable energy sources?



I think it is a great idea.



Dublinbay12 said:


> wheras the Central banks are mandated by governments to move to renewable sources.





Dublinbay12 said:


> It has been pointed out here by @tecate in the context of chinese miners the government or even the military can do nothing towards them and thus could not enforce sanctions.



Well I think if governments are mandating  CBs to move to renewable energy sources then the same governments should practice what they preach and only allow import goods and services from foreign countries if they are satisfied that the foreign country is manufacturing and delivering the goods and services using renewable energy sources.
This will put the dirty fossil fuel industry out of business in no time.



Dublinbay12 said:


> I don't think it is fair to argue using future examples of BTC but not allowing for the same use of future landscapes in established markets.


I'm not arguing that at all.



Dublinbay12 said:


> am not sure how people can justify the adoption of BTC by wall street as good for the community?



I didn't.


----------



## DublinHead54

WolfeTone said:


> Well I think if governments are mandating  CBs to move to renewable energy sources then the same governments should practice what they preach and only allow import goods and services from foreign countries if they are satisfied that the foreign country is manufacturing and delivering the goods and services using renewable energy sources.
> This will put the dirty fossil fuel industry out of business in no time.


So you aren't allowing time for governments and manufacturing to change over time? Conversely you are accepting that BTC needs time to convert to 100% renewable? 

So you have a different view on how BTC should change vs say regular manufacturing? Or is your view that the switch should happen immediately regardless if it impacts BTC or not? Every industry should move to renewable immediately or die?


----------



## WolfeTone

Dublinbay12 said:


> you aren't allowing time for governments and manufacturing to change over time? Conversely you are accepting that BTC needs time to convert to 100% renewable?



Bitcoin, governments, manufacturing, consumers et al, all need time to move to renewable energy sources.


----------



## DazedInPontoon

Bitcoin can generally move much quicker too, since it's not location dependent. All you need is power and a sufficient internet connection. A cooler climate helps too.


----------



## tecate

WolfeTone said:


> Bitcoin, governments, manufacturing, consumers et al, all need time to move to renewable energy sources.


Indeed, but only bitcoin is being singled out for special treatment facing the Spanish Inquisition with a similar level of enlightenment as existed back then.



DazedInPontoon said:


> Bitcoin can generally move much quicker too, since it's not location dependent. All you need is power and a sufficient internet connection. A cooler climate helps too.


Indeed it can. One innovative startup has put together custom-built containers complete with mining kit  adapted for adverse conditions that can be dropped into remote oil fields. They're ready to go to exploit flared gas that otherwise is not put to productive use (it cant be as we're talking about locations that lack inhabitants). The containers can be further redeployed as needed.
If a cheap energy source dries up, that kit isn't going to be binned. It will be sold off and redeployed globally. There have also been cases of governments confiscating kit and putting it back into service themselves directly.

Time to clear up some 'misunderstandings' - i cant remember who raised these but no matter.

I've never suggested that a government cant shut down bitcoin miners. If they can find them, then they can shut them down. What I do claim is that it's highly unlikely we will see 195 countries coordinate such an action as that's what's required to take the network down. 90% of countries wouldn't be enough.

Nobody here has ever suggested that bitcoin mining is a charitable activity. I have referred to it as a business that now requires significant investment  for anyone who wishes to enter it.

On consideration of what awaits bitcoin and it's ecosystem going forward, of course that's relevant. In terms of the energy debate, previous posts have identified that bitcoin miners have a current and ongoing incentive to pursue the cheapest energy on the planet. That's why btc mining has a  higher green energy content than other sectors. Other sectors don't have the same incentive (whereas  the outcome could be bankruptcy for bitcoin miners if they don't find the cheapest energy). Other sectors can just coast along whereas bitcoin miners have no choice but to take an innovative approach to ensuring the cheapest supply on the planet.
As regards bitcoin generally, how the next years pan out is very important. Someone can decide to judge a technology that isn't complete if they wish but that would be a mistake. Imagine if AAMers put the internet on trial in 1990 based on what it could achieve at that point? It had scaling issues (sounds familiar), it was difficult to access and use (sound's familiar) and it hadn't disrupted anything at that point.

Its clear to me that some of the smartest minds around are building services on top of the bitcoin base settlement layer. Sure, its a speculation as regards the utility of what they build out but it still can't be ignored.


----------



## tecate

Just to underscore the increasingly green energy aspect of BTC mining, the comments of Norwegian billionaire Kjell Inge Rokke are interesting in his letter to shareholders earlier today where he announced the establishment of a bitcoin/bitcoin infrastructure unit within oil & gas company, Aker:

_"Seetee will establish mining operations that transfer stranded or intermittent electricity without stable demand locally—wind, solar, hydro power— to economic assets that can be used anywhere. Bitcoin is, in our eyes, a load-balancing economic battery, and batteries are essential to the energy transition required to reach the targets of the Paris Agreement. Our ambition is to be a valuable partner in new renewable projects."_


----------



## tecate

This is an excellent piece written by Lyn Alden which sets out the power of network effect - and why bitcoin can only be toppled by a project which is 10x better than it.


----------



## tecate

A couple of important developments within the past 24 hours:

- It's emerged that Visa is working towards enabling bitcoin on its network such that it can be accepted by its 70 million merchants as a means of payment. 
- Morgan Stanley has become the first major bank to offer its clients access to bitcoin-based funds.


----------



## tecate

Duke of Marmalade said:


> The bit about adoption as a medium of exchange is of course a nonsense.  They [Tesla] will accept bitcoin as payment which they say they may "immediately liquidate".


Elon has confirmed that a Tesla can now be bought with bitcoin. He's also stated that the company will retain any funds received in BTC and won't convert them back to fiat money.


----------



## 24601

tecate said:


> Elon has confirmed that a Tesla can now be bought with bitcoin. He's also stated that the company will retain any funds received in BTC and won't convert them back to fiat money.


Well that absolutely confirms his utter lunacy anyway.


----------



## Duke of Marmalade

tecate said:


> Elon has confirmed that a Tesla can now be bought with bitcoin. He's also stated that the company will retain any funds received in BTC and won't convert them back to fiat money.


The climbdown is more telling than the original.  The original is simply a common sense statement from the bean counters.  If your operating currency is US$ or whatever then any revenues will in the normal course be converted into US$ irrespective of whether they originated as £, Y, €, BTC.  That is normal practice.  That Elon feels compelled to claim a different approach in respect to BTC emphasises that he was sensitive that the original statement somewhat detracted from his pump strategy.
Anyway the commitment is meaningless.  I presume Elon has a sense of how much BTC he wants to pump and when he wants to dump.  This minor detail regarding the immediate treatment of BTC sales of Testa is immaterial to that strategy.


----------



## WolfeTone

Duke of Marmalade said:


> The climbdown is more telling than the original. The original is simply a common sense statement from the bean counters. If your operating currency is US$ or whatever then any revenues will in the normal course be converted into US$ irrespective of whether they originated as £, Y, €, BTC. That is normal practice. That Elon feels compelled to claim a different approach in respect to BTC emphasises that he was sensitive that the original statement somewhat detracted from his pump strategy.
> Anyway the commitment is meaningless. I presume Elon has a sense of how much BTC he wants to pump and when he wants to dump. This minor detail regarding the immediate treatment of BTC sales of Testa is immaterial to that strategy.



 I do admire your resilience, albeit it is oft misplaced.

A long-standing tenet of the Roubini school of thought is that you cannot buy anything with bitcoin. Along comes a commercial trader who openly accepts bitcoin in exchange for goods his company produces, and that is now 'meaningless'! 

The volatility of the US$ to BTC would suggest otherwise.


----------



## Duke of Marmalade

WolfeTone said:


> I do admire your resilience, albeit it is oft misplaced.
> 
> A long-standing tenet of the Roubini school of thought is that you cannot buy anything with bitcoin. Along comes a commercial trader who openly accepts bitcoin in exchange for goods his company produces, and that is now 'meaningless'!
> 
> The volatility of the US$ to BTC would suggest otherwise.


I think you are over interpreting Professor Roubini.  I think he would acknowledge that 2 pizzas were bought for 10,000 btc and that there currently is an active cult in buying lattes with btc.  This does not in any material way detract from his assertion that it is not a medium of exchange.

Why is Musk boring us with the minituae of Tesla's forex day to day transactions?  Why is he operating a different policy on btc than for other forex as would be implemented by his bean counters?  I'll tell you why.  It is part of his pump propaganda which has already been good for a paper gain of about $500M since he made his announcement.  Please let us not believe that the announcement that he would accept payment in btc was merely updating his shareholders on operational matters.  It was pumping the $1.5bn purchase of btc that he was simultaneously announcing. 

I wonder how many Tesla insiders benefitted from the totally to be anticipated boost in btc following rocketman's announcement.  We will never know, as dealings in btc are censor resistant.  What a wonderkid btc is, the way round all regulation.


----------



## WolfeTone

Duke of Marmalade said:


> Please let us not believe that the announcement that he would accept payment in btc was merely updating his shareholders on operational matters



The official and formal update to shareholders on operational matters re buying and acceptance of bitcoin was transmitted to the SEC back in early February. This is just an normal commercial announcement, that any other of millions of commercial entities undertake over the world everyday. Like "we now accept American Express", or "You can now buy our merchandise on-line".

It is perfectly normal practice, but only in Roubini school of thought would a dark and sinister theory of wanting to make available additional purchase options to prospective customers amount to a 'pump and dump scheme'.

Think about it, in order to purchase a $50,000 Telsa with bitcoin, I either have to buy $50,000 worth of btcoin or use my existing bitcoin (valued at $50,000). 
Where is the pump? Where is the dump?


----------



## Duke of Marmalade

WolfeTone said:


> The official and formal update to shareholders on operational matters re buying and acceptance of bitcoin was transmitted to the SEC back in early February. This is just an normal commercial announcement, that any other of millions of commercial entities undertake over the world everyday. Like "we now accept American Express", or "You can now buy our merchandise on-line".
> 
> It is perfectly normal practice, but only in Roubini school of thought would a dark and sinister theory of wanting to make available additional purchase options to prospective customers amount to a 'pump and dump scheme'.
> 
> Think about it, in order to purchase a $50,000 Telsa with bitcoin, I either have to buy $50,000 worth of btcoin or use my existing bitcoin (valued at $50,000).
> Where is the pump? Where is the dump?


I was referring to the earlier formal announcement.  We can see that the announcement got far more attention than a run of the mill "we now accept American Express".  If you think that the purchase of btc in the weeks before this announcement was pure coincidence you are even more nigh eve than your eponymous forebear.  That is the pump.  Why give this latest clarification to a minor operational matter if not to keep the pump primed.
Rocketman will decide when to dump.


----------



## WolfeTone

Duke of Marmalade said:


> If you think that the purchase of btc in the weeks before this announcement was pure coincidence



The announcement to SEC and stockmarkets is a regulatory requirement if I am not mistaken? 
To then deduce from complying with regulatory requirements is all part of some scurrilous pump and dump scheme is laughable.


----------



## Duke of Marmalade

WolfeTone said:


> The announcement to SEC and stockmarkets is a regulatory requirement if I am not mistaken?
> To then deduce from complying with regulatory requirements is all part of some scurrilous pump and dump scheme is laughable.


Strange sense of humour _Wolfie_.
If you think an investment in btc just prior to a highly reported operational endorsement of btc, which together pumped btc to the tune of about $20, was coincidence then there is nothing much more that I can say.
So on this latest announcement why treat btc purchases different from other forex purchases and make a big announcement about it?  To keep the pump primed, what else? Wasn't @tecate on to it like a flash.


----------



## MelF

Was considering firing a few quid into it, but this article gave me pause. It's a bit long and breathless, but think the point stands. Possible shenanigans afoot somewhere?








						The Bit Short: Inside Crypto’s Doomsday Machine
					

This is the story of a Bitcoin trade — the most financially impactful trade I’ve ever made in my life. It’s also the story of the…




					crypto-anonymous-2021.medium.com


----------



## WolfeTone

Duke of Marmalade said:


> Strange sense of humour _Wolfie_. If you think an investment in btc just prior to a highly reported operational endorsement of btc was coincidence nothing much more that I can say.



Ah c'mon Duke, the Roubini one has you in a stranglehold. We've been through BOHA, been through criminality, been through Ponzi and Tether, and BTC is alive and well, more so than ever. 
Now the pump and dump get-rich-quick schemesters are behind the BTC bubble, billionaire Musk being one of them - because what else would he be doing with his already accumulated enormous wealth other than park it in some nefarious fraud? 

Or is it more likely that as Musk understands bitcoin and intends to trade in it, that holding a quantity of it in reserve makes perfect economic and financial sense? 

Actually, shouldn't a pump of $1.9trn into the US economy be on the pump-and-dump radar more so? Where did they get it from? From the Tether playbook?


----------



## tecate

24601 said:


> Well that absolutely confirms his utter lunacy anyway.


How so?


Duke of Marmalade said:


> there currently is an active cult in buying lattes with btc.


The pre-imminent fiat currency in the world includes the words 'In God We Trust' on its notes yet anyone who is even mildly encouraged by this monetary tech is part of a 'cult'.


Duke of Marmalade said:


> This does not in any material way detract from his assertion that it is not a medium of exchange.


Real world examples of its use as a medium of exchange suggest that over the longer haul, he's going to be proven wrong. Roubini (or your good self) can disregard the power of a network effect that's growing year on year all you want - but its a mistake to do so.



Duke of Marmalade said:


> Why is Musk boring us with the minituae of Tesla's forex day to day transactions?


Boring you? Firstly, if it 'bores' you then, you don't have to pay him or his statements any attention. Secondly, I'm quite sure he's being asked repeatedly when such payments will be accepted.



			
				Duke of Marmalade said:
			
		

> It is part of his pump propaganda which has already been good for a paper gain of about $500M since he made his announcement.


LOL - of course it is, Dukey



			
				Duke of Marmalade said:
			
		

> I wonder how many Tesla insiders benefitted from the totally to be anticipated boost in btc following rocketman's announcement. We will never know, as dealings in btc are censor resistant.


What on earth are you talking about!?  Do you even know what censorship resistance is - as that statement of yours suggests you don't.
What 'way around regulation'?  Tesla is a regulated company. Bitcoin is regulated in terms of how it is utilised within that corporate world. You're just dreaming up and casting aspersions now.




Duke of Marmalade said:


> We can see that the announcement got far more attention than a run of the mill "we now accept American Express".


YOU said at the time that this was a potential 'game-changer'!



Duke of Marmalade said:


> If you think that the purchase of btc in the weeks before this announcement was pure coincidence you are even more nigh eve than your eponymous forebear.  That is the pump.  Why give this latest clarification to a minor operational matter if not to keep the pump primed.
> Rocketman will decide when to dump.



Turn on CNBC right now. Within 5 minutes there will be some Wall Street type that is shilling something or other. When have you ever criticised this?  Yet in this instance, you're all over it because of a hatred for a certain decentralised monetary tech.  Where was your moral outrage 12 months ago when that hedge fund owner went onto CNBC and told everyone - with oscar-winning emotion -that the world was ending...only to find a few weeks later he had made millions having taken the opposite position to what he was stating!?




Duke of Marmalade said:


> If you think an investment in btc just prior to a highly reported operational endorsement of btc, which together pumped btc to the tune of about $20, was coincidence then there is nothing much more that I can say.


See above.



Duke of Marmalade said:


> Wasn't @tecate on to it like a flash.


You deliberately misinterpreted Tesla's original statement on the matter. They stated that they 'may' convert btc received to usd - but you pointed to that with the suggestion that they would - not that they 'may'. It's on the back of that that I've brought Musk's clarification (that they won't convert back to usd) to your attention. Other than that, is it significant?  - of course it is. Hiroo Onoda wouldn't hold a candle to you, your dukeness!




MelF said:


> Was considering firing a few quid into it, but this article gave me pause. It's a bit long and breathless, but think the point stands. Possible shenanigans afoot somewhere?
> 
> 
> 
> 
> 
> 
> 
> 
> The Bit Short: Inside Crypto’s Doomsday Machine
> 
> 
> This is the story of a Bitcoin trade — the most financially impactful trade I’ve ever made in my life. It’s also the story of the…
> 
> 
> 
> 
> crypto-anonymous-2021.medium.com


FUD - fear, uncertainty and doubt. There is NO evidence to back up these claims. Tether/Bitfinex were investigated over 2 years and the NY AG came up with diddly squat.  There's a thread on it here.


----------



## tecate

WolfeTone said:


> Actually, shouldn't a pump of $1.9trn into the US economy be on the pump-and-dump radar more so? Where did they get it from? From the Tether playbook?


Now, now, Wolfie - we don't talk about that sort of thing here!


----------



## Duke of Marmalade

WolfeTone said:


> - because what else would he be doing with his already accumulated enormous wealth -


Actually that one does puzzle me.  Why on earth does Muskie bother with anything?  I guess his enormous ego needs constant pampering.  I further guess that is why he has embraced btc - as you say hardly because he is short a few bob.  All one can say is that the evidence is that the combined announcement of taking a position and accepting btc for his cars has turned out to be a huge pump.  The motivations for that pump are, as I say, puzzling.


----------



## tecate

Duke of Marmalade said:


> All one can say is that the evidence is that the combined announcement of taking a position and accepting for his cars has turned out to be a huge pump.  The motivations for that pump are, as I say, puzzling.


I see. So when the next corporate adds btc to their balance sheet, they should do so in stealth? Maybe they can ask the SEC not to allow such filings to be published?...or what would be an acceptable standard here so as you don't accuse them of not only being involved in pumping but alluding to a subsequent dump?
On the dumping side of things, at what price should we expect Tesla/Musk to offload btc?


----------



## Duke of Marmalade

tecate said:


> Boring you?


It's a figure of speech.  Why is he promoting this trivia?


tecate said:


> What on earth are you talking about!?  Do you even know what censorship resistance is - as that statement of yours suggests you don't.


You are right, I haven't a clue what "censorship resistant" means. Please enlighten me.  What I meant is explained in my next answer.


tecate said:


> What 'way around regulation'?  Tesla is a regulated company. Bitcoin is regulated in terms of how it is utilised within that corporate world. You're just dreaming up and casting aspersions now.


In any plc there is a freeze on dealing in the shares for a period before announcement of results.  This is totally enforceable as there is complete transparency in transactions in the shares of plcs.  Anybody working on the latest formal announcement of Tesla would be totally dumb not to see the chance to make a quick buck on a totally predictable btc spike.  It would I think be against the law to exploit this insider knowledge.  But the temptation for some would be irresistible given that any dealings in btc are totally untraceable, though correct me if I have that wrong.


tecate said:


> YOU said at the time that this was a potential 'game-changer'!


I meant it would be perceived my mainstream Wall Street as a pgc and that there would be a reaction from that quarter.  I am not sure whether that has happened.


tecate said:


> Turn on CNBC right now. Within 5 minutes there will be some Wall Street type that is shilling something or other. When have you ever criticised this?  Yet in this instance, you're all over it because of a hatred for a certain decentralised monetary tech.  Where was your moral outrage 12 months ago when that hedge fund owner went onto CNBC and told everyone - with oscar-winning emotion -that the world was ending...only to find a few weeks later he had made millions having taken the opposite position to what he was stating!?


This is a thread on btc.  You are right I didn't comment on those incidents and neither have I commented in this thread on recent mass shootings in the US.


tecate said:


> You deliberately misinterpreted Tesla's original statement on the matter. They stated that they 'may' convert btc received to usd - but you pointed to that with the suggestion that they would - not that they 'may'. It's on the back of that that I've brought Musk's clarification (that they won't convert back to usd) to your attention.


"may" "would" mea culpa

On when Muskie will dump that is a difficult call.  _Wolfie _is right that it is difficult to see his motivation as increasing his wealth.  So it will be a circumstance where continuing to hold would damage his ego.  So I withdraw my accusation that he pumped with an actual view to dumping - but pumping he did and continues to do.  The very fact of his purchase was a pump, we can't blame him for that.  But backing up his investment by an immediate announcement that his company will accept btc was not necessary.  Anybody with a bit of decency would have made the latter announcement first so as not to be accused of pumping, but I don't think such accusations would faze Mr Musk.


----------



## tecate

Duke of Marmalade said:


> It's a figure of speech.  Why is he promoting this trivia?


If it's not of interest to you, then you don't have to pay any attention to it. On 'promotion', he made a statement that is of interest to many (even if its of no interest to you).



Duke of Marmalade said:


> You are right, I haven't a clue what "censorship resistant" means. Please enlighten me.


Censorship resistance is one of the major selling points of bitcoin. It means that unlike traditional monetary networks, nobody can censor anyone from accessing the network - and sending or receiving payments.



Duke of Marmalade said:


> In any plc there is a freeze on dealing in the shares for a period before announcement of results.  This is totally enforceable as there is complete transparency in transactions in the shares of plcs.  Anybody working on the latest formal announcement of Tesla would be totally dumb not to see the chance to make a quick buck on a totally predictable btc spike.  It would I think be against the law to exploit the insider knowledge.  But the temptation for some would be irresistible given that any dealings in btc are totally untraceable, though correct me if I have that wrong.


Why are you singling out bitcoin in this instance? BTC transactions are not totally untraceable - far from it. It's possible to not be identified as a participant on the network but it's complex to achieve that more often than not. The very same thing is possible in the traditional world and happens all the time despite these rules you talk of. Lets take a recent example. In March of last year in the US, around 4 US senators were found to have sold off shares in advance of measures the US administration took to deal with the pandemic. They had knowledge that the rest of us didn't and they acted on it - and benefited by it. You single out potential for wrongdoing when it suits (when its related to bitcoin) when the reality is that all of this  manipulation and sharp practice has been rife with the wall street set since day 1. Don't go claiming otherwise.




Duke of Marmalade said:


> I meant it would be perceived my mainstream Wall Street as a pgc and that there would be a reaction from the quarter.  I am not sure whether that happened


Same difference - what has changed today that it's no longer the game changer that you said it was? 



Duke of Marmalade said:


> This is a thread on btc.  You are right I didn't comment on those incidents and neither have I commented in this thread on recent shootings in the US


You're applying double standards. You hold anything related to bitcoin to a higher standard. There's no equity in taking that position.



Duke of Marmalade said:


> So I withdraw my accusation that he pumped with an actual view to dumping - but pumping he did and continues to do.  The very fact of his purchase was a pump, we can't blame him for that.  But backing up his investment by an immediate announcement that his company will accept btc was not necessary


Let's assume that he is for expediency. How is he any different to ANYONE who discusses stocks, shares, markets, etc on any social media - but particularly the likes of CNBC? If you assume that he's 'pumping' without any further insight, then we can assume that the others are too. You're active on the 'investments' sub-forum here - where traditional stocks/shares/investments are discussed. Can you link to a post where you've cited this sort of carry on in the traditional markets? If not, why not?  Why does anything related to bitcoin get the treatment?


----------



## WolfeTone

Duke of Marmalade said:


> So I withdraw my accusation that he pumped with an actual view to dumping



So _not_ a pump-and-dump then, just a pump? A perfectly legitimate endeavour, investing one's own cash, or cash on behalf of others, into an asset on the premise that it will increase the value of the investment. 



Duke of Marmalade said:


> Anybody working on the latest formal announcement of Tesla would be totally dumb not to see the chance to make a quick buck on a totally predictable btc spike.



This is absolutely no different to anybody working anywhere with access to information not readily accessible to the public at large.

The critical element is the intent. If the intent is to temporarily drive up prices for the purposes of extracting a profit by then selling off holdings, in turn driving down the price, then you may have a case. 
So, if the near future Tesla announce a cancellation of accepting bitcoin for its products and subsequently reveal it had offloaded its bitcoin before such a reversal, then I certainly would be sceptical of Musks intentions. 

But as you have already admitted there is little to no evidence of Musk being engaged in such practices. 

Here is a link, posted by Roubini, of actual charges being laid against individuals accused of crypto pump-and-dump. 

CFTC pump-and-dump charges 

The scheme allegedly involves touting various crypto assets while concealing their own held positions. 
Amounts of $2m profit are alleged to have been made. 
In the grand scheme of schemes, this is hardly the big fish that Roubini says is out there to catch?


----------



## Duke of Marmalade

WolfeTone said:


> This is absolutely no different to anybody working anywhere with access to information not readily accessible to the public at large.


You're completely missing my point.  Insider trading is a complete no-no and when it comes to dealing in shares there is total transparency to expose such insider trading.  With btc there is no such transparency, I thought that was one of its charms.  There can be no question that most people in Tesla's accounting department and their friends an relatives filled there boots with this totally to be expected btc spike - they will never be found out.


----------



## WolfeTone

Duke of Marmalade said:


> You're completely missing my point. Insider trading is a complete no-no and when it comes to dealing in shares there is total transparency to expose such insider trading



I think you are misconstruing the concept of insider trading.
In general parlance 'insider trading' is considered a no-no, because of the _potential_ unfair advantage to those who hold valuable information, And the _actual_ unfair advantage in cases of proven corruption.

But not all insider trading is illegal.
A company CEO who increases her shareholding in the company she operates, on (perceived) favourable commercial news, is perfectly entitled to do so as long as it is not hidden away from the public (assuming the purchase of stock by itself has made little material difference to the stock price ).
Is it insider trader (by corrupt practice) if the market perceives the CEO purchase of shares as favourable, in turn stock market speculators drive the price up?

A bank clerk processing increasing amounts of mortgage approvals may reasonably deduce that property prices may start to increase in the near future and act accordingly by buying his own buy-to-let apartment before the public is made aware of the increase of mortgage applications.
In both instances, this is insider trading, but it is not illegal.

For it to be illegal, there has to some proven intent to profit by corrupt means - deception, misleading information, non-compliance with regulatory requirements etc



Duke of Marmalade said:


> There can be no question that most people in Tesla's accounting department and their friends an relatives filled there boots with this totally to be expected btc spike - they will never be found out.



I'm not sure if you are suggesting they filled their boots with Tesla stock or BTC, or both? I assume you mean BTC because of the "they will never be found out" reference?

I'm not convinced it is illegal at all, but as I referenced, if it is shown that Telsa have offloaded their BTC holding in advance of a reversal of their BTC trading position, then I think that would raise a red flag.


----------



## tecate

Duke of Marmalade said:


> You're completely missing my point.  Insider trading is a complete no-no and when it comes to dealing in shares there is total transparency to expose such insider trading.  With btc there is no such transparency, I thought that was one of its charms.  There can be no question that most people in Tesla's accounting department and their friends an relatives filled there boots with this totally to be expected btc spike - they will never be found out.


Wall Street wrote the book on insider trading!  I notice that you conveniently ignored the two examples I provided you with.  Here's the detail on Bill Ackman's '_Hell is Coming_' interview - and the $2 billion he made by trading in the other direction.
Here's the detail on the congressional insider trading scandal from last year ->  LINK.

How is there 'no transparency' re. bitcoin in what you're attempting to set out above? Walk us through it as if you are that person working in this 'accounting dept'.


----------



## Duke of Marmalade

@WolfeTone I guess you are right.  Tesla staff using a bit of inside knowledge to make a few bob is no big deal.  It amuses me ( my sense of humour) how the BTC community hang on Muskie’s every sneeze for self assurance. I guess that’s where Rocketman gets his kicks.
@tecate careful now.  I got a right rollicking from a moderator for calling somebody a tr*ll.  I myself am not a sensitive soul but I was warned it was akin to using the N word in these parts.

On a separate point, the logistics of corporate holdings of BTC seem very problematic.  Who keeps the private keys of Tesla’s $2bn holding?  What if they get run over by a bus?  What if they transfer to themselves and get next flight to Brazil?  Seems to me the centralised nature of conventional currency is a big advantage for corporates.


----------



## tecate

Duke of Marmalade said:


> The logistics of corporate holdings of BTC seem very problematic.  Who keeps the private keys of Tesla’s $2bn holding?  What if they get run over by a bus?  What if they transfer to themselves and get next flight to Brazil?  Seems to me the centralised nature of conventional currency is a big advantage for corporates.


Dukey, you think that Gillian from accounts has the private key for Tesla's $1.5 billion + worth of bitcoin written down on a napkin? 

Enterprise-grade crypto custodians include the likes of Coinbase Custody, Bitgo, Kingdom Trust, Gemini, Anchorage, Bakkt....



			
				Duke of Marmalade said:
			
		

> I guess you are right. Tesla staff using a bit of inside knowledge to make a few bob is no big deal.


No, Dukey - this is serious. I think that a fine upstanding citizen like yourself should contact the relevant authorities.

Report Suspected Securities Fraud or Wrongdoing


For expediency, here's the relevant evidence you've uncovered of that wrongdoing -> Dukey's Evidence

If you mark it '_because bitcoin'_, I'm sure they'll bump it up to the top of the pile and put their top forensic investigators on it.


----------



## Duke of Marmalade

tecate said:


> Dukey, you think that Gillian from accounts has the private key for Tesla's $1.5 worth of bitcoin written down on a napkin?
> 
> Enterprise-grade crypto custodians include the likes of Coinbase Custody, Bitgo, Kingdom Trust, Gemini, Anchorage, Bakkt....


Okay, I do not want to get into the weeds of custody but it must be pretty hairy.  What if the place burns down?  Surely there isn't a single key for $2bn.  Given the irreversibility of btc transfers the scope for fraud/skip to Brazil seems enormous. 
Further exploration of these matters would bring us down a rabbit hole.


----------



## tecate

Duke of Marmalade said:


> Okay, I do not want to get into the weeds of custody but it must be pretty hairy.  What if the place burns down?  Surely there isn't a single key for $2bn.  Given the irreversibility of btc transfers the scope for fraud/skip to Brazil seems enormous.


Ok, so you're saying that Gillian from accounts _does _have the private key written on a napkin? I'd say you should mention that in your report to the SEC also.



Duke of Marmalade said:


> Further exploration of these matters would bring us down a rabbit hole.



Absolutely - far better to have people believe that a corporate with a market cap of $600 billion has entrusted Gillian from accounts with the private key for $1.5billion+ of its digital assets. It makes for a far better narrative.


----------



## Duke of Marmalade

tecate said:


> Ok, so you're saying that Gillian from accounts _does _have the private key written on a napkin? I'd say you should mention that in your report to the SEC also.
> Absolutely - far better to have people believe that a corporate with a market cap of $600 billion has entrusted Gillian from accounts with the private key for $1.5billion+ of its digital assets. It makes for a far better narrative.


You have taken me up wrongly.  I am not in my usual bashing btc mode.  I am genuinely puzzled  at the logistics of custody of mega corporate holdings. No way did I think George from the accounts dept has the private key.  It was the opposite thought that had me wondering.  Who are the select few who do have the private key? It would have to be a very select few indeed and they would have to be very careful not to travel on the same plane.
You have informed me that there are professional enterprises devoted to crypto custody.  I would be thinking that they would have my key person problem, but I am prepared to accept that it all works like clockwork.


----------



## DazedInPontoon

There can be multiple wallets, they can be multi-sig wallets with up to at least 16 15 keys each (maybe more these days?) and any number of those required to sign transactions. Keys don't need to be stored by a person necessarily either, they could be stored in safe deposit boxes etc. They also don't all need to be kept by one organisation.

This provides a lot of possibilities. Since as tecate said there's an entire industry now purely about solving this issue, I'm sure they have sufficient solutions varying in the lengths they go to depending on how much you're storing.


----------



## tecate

Duke of Marmalade said:


> No way did I think George from the accounts dept has the private key.


So it's not Gillian, it's George? The rascal. Damn, I do miss those watercooler moments in these covid-infested times.



Duke of Marmalade said:


> It was the opposite thought that had me wondering.  Who are the select few who do have the private key? It would have to be a very select few indeed and they would have to be very careful not to travel on the same plane.
> You have informed me that there are professional enterprises devoted to crypto custody.  I would be thinking that they would have my key person problem, but I am prepared to accept that it all works like clockwork.


I don't know the extent of it - but whilst 90% of folks use one single private key, there is a possibility within the bitcoin protocol to have a multi-signature arrangement. i.e. more than one key exists. You could need 2 of 3 keys for example to sign a transaction. Therefore if Gillian or George decides to run off to Brasil, they won't be able to - unless they get together...in which case i think multisig can be extended out as far as 8 of 15.  Keys are kept in military grade facilities at undisclosed locations globally.

In the near future, I expect that multi-signature will be made more palatable for the ordinary joe - and this will go a long way to prevent fraud, lost funds, etc.


----------



## Duke of Marmalade

tecate said:


> So it's not Gillian, it's George? The rascal. Damn, I do miss those watercooler moments in these covid-infested times.
> 
> 
> I don't know the extent of it - but whilst 90% of folks use one single private key, there is a possibility within the bitcoin protocol to have a multi-signature arrangement. i.e. more than one key exists. You could need 2 of 3 keys for example to sign a transaction. Therefore if Gillian or George decides to run off to Brasil, they won't be able to - unless they get together...in which case i think multisig can be extended out as far as 8 of 15.  Keys are kept in military grade facilities at undisclosed locations globally.
> 
> In the near future, I expect that multi-signature will be made more palatable for the ordinary joe - and this will go a long way to prevent fraud, lost funds, etc.


Yes of course, multi-sig.  I should have known from my Antonopolous.  Mystery solved.


----------



## tecate

Duke of Marmalade said:


> Yes of course, multi-sig.  I should have known from my Antonopolous.  Mystery solved.


This is actually a neat feature of the protocol. As we know, there are millions of people who are not (or will not be) very comfortable with self custody. They will still need the support of banks, etc. So - in the future - I'd expect that banks can offer a scenario where 2 of 3 applies.
In this situation, the bank (or more likely an external custody specialist contracted by the bank) holds one key, you hold a second key - and the third key you could give to someone you trust.

The bank can't take your funds in the case of the bank failing or .gov want to carry out a bail-in. If you lose your key, you have another key holder and the bank to restore access. If you depart this world, there's means for your funds to be accessed via the bank and the third key holder.


----------



## Duke of Marmalade

tecate said:


> This is actually a neat feature of the protocol. As we know, there are millions of people who are not (or will not be) very comfortable with self custody. They will still need the support of banks, etc. So - in the future - I'd expect that banks can offer a scenario where 2 of 3 applies.
> In this situation, the bank (or more likely an external custody specialist contracted by the bank) holds one key, you hold a second key - and the third key you could give someone you trust.
> 
> The bank can't take your funds in the case of the bank failing or .gov want to carry out a bail-in. If you lose your key, you have another key holder and the bank to restore access. If you depart this world, there's means for your funds to be accessed via the bank and the third key holder.


Yes it will need something like that for large holdings.  And it also means you don't need to be mega fussy about safeguarding your private key from others.


----------



## DublinHead54

Musks statement that he will keep the BTC received in BTC is just a marketing statement. Anybody with a bit of accounting knowledge would know that is not the way to manage a business, and I am sure his CFO is not planning that. 

It may make sense in future when Teslas outgoings (salaries, material etc) can be paid for in BTC then it would make sense. As of now they still need $$$ to pay their staff and buy their materials so he may be forced to convert that BTC.

Interestingly this does open up opportunities for Wall Street / Investment Banking to offer derivative products for BTC / Fiat much like they do for global corporations with foreign currency receivables/outgoings via Cross Currency FX Swaps.


----------



## tecate

TIME recently interviewed Michael Saylor on his strategy utilising BTC on the corporate balance sheet to counteract the great monetary supply expansion.


----------



## DublinHead54

tecate said:


> TIME recently interviewed Michael Saylor on his strategy utilising BTC on the corporate balance sheet to counteract the great monetary supply expansion.



Was that a response to my comments? 

You understand that there is a difference between converting cash piles (treasury reserves) into BTC, and keeping receivables in BTC when you have outgoings in a different currency? This isn't really anything to do with BTC, it is cash management. Would you advise a company with its outgoings in USD to decide to receive its cash payment in INR as  good? 

However, my point was that given Teslas outgoings are in USD and they are choosing to hold received payments in BTC it opens up to Wall Street to manage those currency conversions to mitigate the volatility and price risk.


----------



## tecate

As Square CFO Amrita Ahuja put it yesterday,_ "there's absolutely a case for every balance sheet to have bitcoin on it"_. Regardless of this current bull run, we're still incredibly early in the adoption curve. Tesla taking no more than 1-3% of revenue in bitcoin provides an organic way for the company to build its holding organically with no effect on its day to day commitments.

Speaking of balance sheets, kudos to Jay Powell for managing to expand the Fed balance sheet with an additional $3.5 trillion. It took them 6 years to print off the last additional $3.5 trillion so they're obviously getting much better at this.


----------



## Duke of Marmalade

tecate said:


> TIME recently interviewed Michael Saylor on his strategy utilising BTC on the corporate balance sheet to counteract the great monetary supply expansion.


So Saylor has looked at the monetary aggregates and reckons we are in for 15% p.a. inflation.  Well I have a much better way for him to cash in on that insight and it is not rocket science.  US 10 year Treasury nominal yields are 1.77%.  Inflation linked yields are -.67%.   In other words the Wall Street consensus is that 10 year inflation will be around 2.44% p.a.  If Saylor is right he has himself a way of printing money.  Short the nominal yields and long the index yields.  Much much more certain way of cashing in on his inflation hunch, after all it is not impossible that he will be right about inflation and yet the bitcoin bubble will still burst.


----------



## DazedInPontoon

Duke of Marmalade said:


> So Saylor has looked at the monetary aggregates and reckons we are in for 15% p.a. inflation.


Here's how I've understood this. When he says this he's not talking about the official CPI inflation rate, and he's actually saying it's already happening in things that are scarce, desirable and don't get cheaper due to economies of scale  - bitcoin, healthcare, real estate in prime areas, ivy league educations etc.

It suggests that there's a difference between CPI inflation and the rate at which the dollar is losing value, because of how CPI inflation is measured.


----------



## DazedInPontoon

Found something from the horse's mouth in a podcast transcription here: https://learn.saylor.org/mod/page/view.php?id=30724&forceview=1


> Like you start thinking about it and you think what an idiot I am. I could have actually gotten a 22% yield every year for 10 years, you know, buying a long bond, which struck me, you know as a tech investor is the most awful investment decision ever. Right? So I ended up in this bizarre situation and I developed a more nuanced appreciation of inflation like that you know, there's an old saying in propaganda, you know, all of our focus groups, all of our studies that they've shown us, that we can't tell people what to think, but we can tell them what to think about. And so when the media talks about inflation, they talk about CPI and everybody nods, and they all worry about CPI coming. But in fact, CPI is an arbitrary measure where you cherry pick a market basket of things that are not going to go up in cost, if you like, and then you call that CPI.
> 
> And so if you actually, if you actually create an array of all the products, services, and assets in the world that you might purchase with the cash flow that you generate from working, then I think that there's also, there's almost like there's four standard buckets and one special bucket. The first bucket is deflating products like a video and music and maps and information and generic drugs and commodities, anything manufactured news and books, and anything that could be dematerialized during the mobile wave that's on your iPhone, you know is deflating or, or anything dematerialized to an iPad or a computer and anything manufactured by a robot or in a big factory or anything with a low variable cost and a high fixed cost, computer chips, what have you, they get stamped out and massive amounts, and they're all deflating. There's no inflation there.
> 
> And then the next category is flat to 2% and that's like secondary property, property in the secondary markets are manual labor, unskilled, branded consumables. They kind of hold their value, take up a little bit, 1, 2% a year government services, regulated services. And I might not be perfect here, but it's a rough bucket of ideas. And then, you know, then the third bucket is what nobody talks about a bucket where prices are going up like 6 to 8% a year. And that's like luxury products, scarce products, elite education, elite medicine, elite services, like an Ivy league education or good medical care. And I know this cause I went to MIT. It was costing $9,600 a year when I went there 30 years ago. And it costs $60,000 a year now. And so you kind of do the math 30 years going up by a factor of five or six, and it's not 2%.
> 
> And so that's your 7% monetary supply expansion, I suppose. And then I get to this last horrifically painful category where inflation is going up between 8 and 24% a year. And that's equities debt, prime, luxury property, and scarce art. So the S & P 500. I mean, if we look at the S & P index from 1000 to 3,500, over 10 years, that's that gets you a decent clip. And then if you look at that 10 year treasury bill that I talked about, so 22% rate for 10 years, and if you look at penthouse apartment in New York or house in the Hamptons, or an acre of beach front property in South Florida, anything water, I joke LA New York, Miami, San Francisco, London. You know, if you wanted to get a house in the middle of the country that nobody wants to live in, that is not going up 8% a year, but if you're in the magic mile of London or downtown in Central Park or wherever it is, then that stuff's going through the roof.
> 
> And so those are the scarce assets. And of course, I've got one last category, which is, which is inflating faster than 25%. You want to guess what that is,


----------



## Duke of Marmalade

Saylor said:
			
		

> But in fact, CPI is an arbitrary measure where you cherry pick a market basket of things that are not going to go up in cost, if you like, and then you call that CPI.


That explains two things.  First why he would not consider the Long/Short Index Linked/Nominal bond yields.
But more significantly we see a typical attitude of the crypto cult.  CPI is all a big con job - cherry picked goods that are destined not to increase.  Though he is probably right that as inequality increases the prices of yachts and fine art will increase at a faster rate than the CPI which has been tailored to suit the average punter.  Saylor is more interested in yachts and fine art, I guess, and somehow has convinced himself that bitcoin will underpin his future requirements on that front.


----------



## DublinHead54

Holding BTC on the balance sheet as a Treasury reserve and accepting payments in BTC whilst outgoings are in USD are two entirely separate topics. I am not sure why they are being confused in this topic. 

Tesla accepting BTC as payment and holding it in BTC whilst having outgoings down the line in USD opens up the possibility for further adoption by Wall Street. This is entirely independent of companies deciding to invest spare cash in BTC. That should be obvious.


----------



## Duke of Marmalade

Dublinbay12 said:


> Tesla accepting BTC as payment and holding it in BTC whilst having outgoings down the line in USD opens up the possibility for further adoption by Wall Street. This is entirely independent of companies deciding to invest spare cash in BTC. That should be obvious.


If he offered his staff an option to have their salary denominated in btc I wonder how many takers he would have.  Same goes for Saylor.


----------



## DublinHead54

Duke of Marmalade said:


> If he offered his staff an option to have their salary denominated in btc I wonder how many takers he would have.  Same goes for Saylor.



At this point Saylor won't because he is holding BTC as a Treasury Asset / Reserve.

Tesla is more likely given his stance on accepting BTC as a payment and thus having BTC as 'working' capital for day to day business management. I guess it depends on what the offer is... paid in amount of BTC equivalent to your USD salary or just paid in a set amount of BTC irrespective of the dollar equivalent. To be true to the vision of BTC it should be the latter but given that BTC is not used as a currency I can't really see it working. It does bring up an interesting point, if a firm was to pay in BTC, how would they value the salary in BTC terms. 

I think Tesla employees are more concerned with the share price and their stock options than they would be trying to get rich from BTC.


----------



## DazedInPontoon

blockchain.info used to be an entirely btc company as far as I know, all income and all salaries etc were in bitcoin, this was years ago, not sure if they still are.


----------



## tecate

Duke of Marmalade said:


> But more significantly we see a typical attitude of the crypto cult.


Here's your cult!


Duke of Marmalade said:


> CPI is all a big con job - cherry picked goods that are destined not to increase.  Though he is probably right that as inequality increases the prices of yachts and fine art will increase at a faster rate than the CPI which has been tailored to suit the average punter.


Ah, yes - yachts and fine art, Dukey.  That's why the CPI excludes food and energy, is it!? And the average punter doesn't aspire to have a roof over their head so lets not consider house prices either.



			
				Duke of Marmalade said:
			
		

> If he offered his staff an option to have their salary denominated in btc I wonder how many takers he would have.  Same goes for Saylor.


You know perfectly well that this sovereign money world is one we all inherited. Therefore, it's not realistic to have people switch to a 100% crypto payment scenario. That said, I'm aware of quite a few folk who do get paid in crypto. I've been paid myself in crypto on occasion. And in the meantime, the bridges between those two worlds continue to be built. Any crypto I possess today - I can spend in crypto or I can spend in fiat via a plethora of visa/mastercards. Yesterday, visa announced that they will accept crypto payment to settle payments on their network. Later today, Paypal will facilitate US account holders to spend crypto at millions of online merchants.


----------



## Duke of Marmalade

tecate said:


> Ah, yes - yachts and fine art, Dukey.  That's why the CPI excludes food and energy, is it!? And the average punter doesn't aspire to have a roof over their head so lets not consider house prices either.






*Food, Housing,  Electricity and Gas.  *
So the cult believes that these are excluded and that anything we see on official websites is fake news.  Okay, you think I'm nigh eve to believe this stuff.


----------



## tecate

Duke of Marmalade said:


> *Food, Housing,  Electricity and Gas.  *
> So the cult believes that these are excluded and that anything we see on official websites is fake news.  Okay, you think I'm nigh eve to believe this stuff.


Once again - here's your cult. 

There are various means of calculating inflation. The one that is rolled out to the general public is this one - with its exclusions.


----------



## DazedInPontoon

I don't think it's fake, I just think it's a bad measure of the rate at which money is losing value in real terms - compared to holding _valuable_ assets.

I don't think that the rate of CPI inflation and the rate at which money loses value are the same thing. Maybe it depends which of those two things you care more about, which may be related to how wealthy you are. Saylor isn't going to care if the price of milk goes up 5%.


----------



## tecate

DazedInPontoon said:


> Saylor isn't going to care if the price of milk goes up 5%.


Saylor has spoken extensively over the course of the past year about the CPI not being a true measure of inflation in real terms. He has repeatedly  pointed to major asset price inflation - again, not reflected in the CPI.


----------



## DazedInPontoon

tecate, you might have missed my earlier post today https://askaboutmoney.com/threads/bitcoin-in-a-hyperbolic-bubble.221643/post-1714383


----------



## Duke of Marmalade

tecate said:


> Once again - here's your cult.
> 
> There are various means of calculating inflation. The one that is rolled out to the general public is this one - with its exclusions.


The cult (cue picture of a greenback) is cherry picking its story.  Apparently economists in the US prefer to exclude the things you say.  Cult grabs this titbit and screams "told you so" even with some faux concern for the housing problems of the poor.  But the official US CPI most certainly does not exclude those items.  The following is an extract from the FAQ on the official calculation of the CPI provided by the US CSO.


			
				US CSO said:
			
		

> A particular type of cheese item will be chosen, with its likelihood of being selected roughly proportional to its popularity. If, for example, cheddar cheese in 8 oz. packages makes up 70 percent of the sales of cheese, and the same cheese in 6 oz. packages accounts for 10 percent of all cheese sales, and the same cheese in 12 oz. packages accounts for 20 percent of all cheese sales, then the 8 oz. package will be 7 times as likely to be chosen as the 6 oz. package.


----------



## tecate

Duke of Marmalade said:


> The cult (cue picture of a greenback) is cherry picking its story.


The Duke of _Pot Calling Kettle Black_ Marmalade is correct. Any unreasonable tar and feathering 'cult' references will be accompanied by a demonstration of the cult of fiat money -> 'In God We Trust' .....you think they didn't have cult in mind with that - and that's before we get into the rest of the symbolism on a dollar bill.
But here you go.
The euro can't in any way compete with that - the ECB has settled for the signature of a convicted fraudster on its notes.


Duke of Marmalade said:


> Apparently economists in the US prefer to exclude the things you say.  Cult grabs this titbit and screams "told you so" even with some faux concern for the housing problems of the poor.  But the official US CPI most certainly does not exclude those items.  The following is an extract from the FAQ on the official calculation of the CPI provided by the US CSO.


You've just proven my point. People are fed this nonsense - with the exclusion of food, energy and housing  - to blind them from the real rate of inflation.


----------



## Duke of Marmalade

tecate said:


> You've just proven my point. People are fed this nonsense - with the exclusion of food, energy and housing  - to blind them from the real rate of inflation.


The Fed target 2% inflation - this is the official CPI not the one that is preferred by some economists.  The cult seems to get great buzz from a belief that the reason for these economists to take this position is part of a grand conspiracy to hood wink the ordinary punter who are not as enlightened as the cultists.


----------



## WolfeTone

Saylor is spot on about inflation.
And more and more people are seeing through the phony CB orchestration of fiat based economies.

2% is the touted target, by Fed and ECB.
Are there two more abysmally performing organisations presumptuous to their own self-importance?
The Vatican perhaps?

These two banks are now full throttle on the money-printing machine. They have abandoned the one core tenet of all economic theory, scarcity.
Their policy is to patch up all and any structural deficits in the economy by additional splashes of fiat currency to cover up the disrepair.
It works for a while, but Covid has forced the hand and exposed the magic money trees that grease the rentier sector in favour of the productive sector.


----------



## Duke of Marmalade

I was thinking of replacing my 8 year old car.  I see it is about the same price as it was 8 years ago but probably better spec.  But I do have sympathy with Saylor who probably does not have the same situation with his yacht.


----------



## tecate

Duke of Marmalade said:


> The Fed target 2% inflation - this is the official CPI not the one that is preferred by some economists.  The cult seems to get great buzz from a belief that the reason for these economists to take this position is part of a grand conspiracy to hood wink the ordinary punter who are not as enlightened as the cultists.


So tell me, which bs version are you suggesting your buddies are using now? Does this version include housing costs, health insurance and education costs? Are they using 'estimates' or real data? Isn't it interesting that Core CPI became popular in the 70s when inflation went through the roof?
The hood winking is out in the open these days, your Dukeness. The guy that coined the term 'quantitative easing' must have gotten himself a promotion as it avoided your CB buddies from calling it something that the masses would understand -> rampant money printing.



			
				Duke of Marmalade said:
			
		

> But I do have sympathy with Saylor who probably does not have the same situation with his yacht.


So you'll flip flop whichever way suits your narrative, Duke of Marmalade...err...I mean Comrade Marmalade!! I hadn't you down as a socialist but every day's a school day. I suppose there's no need to include housing costs then as you're living in a commune, right?


----------



## Duke of Marmalade

@tecate fair point on the ridiculous use of the term QE.  But the cult isn‘t above using misleading terms. “Mining” indeed. “Digital Gold”.


----------



## DublinHead54

tecate said:


> You know perfectly well that this sovereign money world is one we all inherited. Therefore, it's not realistic to have people switch to a 100% crypto payment scenario. That said, I'm aware of quite a few folk who do get paid in crypto. I've been paid myself in crypto on occasion. And in the meantime, the bridges between those two worlds continue to be built. Any crypto I possess today - I can spend in crypto or I can spend in fiat via a plethora of visa/mastercards. Yesterday, visa announced that they will accept crypto payment to settle payments on their network. Later today, Paypal will facilitate US account holders to spend crypto at millions of online merchants.



Did you mention before that you moved to a country that had favourable tax treatment of crypto so that you can spend it? The fact is and I believe you have made this comment before that the use case for BTC is as a store of value and not a currency in the current environment. 

Wasn't it confirmed that Paypals implementation will convert the BTC to USD immediately thus it will become a taxable event for the customer? I can only see this being used by those who got BTC much earlier before the recent price rise and that it still is profitable to buy goods via paypal accounting for tax. 

But for a person starting out today to go and get BTC and then pay for goods and pay additional tax vs using cash puts it at a disadvantage. It will be interesting to see how paypal BTC transactions grow in the coming months. There is already a small sample to look at with Overstock whose BTC sales accounted for a tiny % of its general sales.


----------



## DublinHead54

tecate said:


> As Square CFO Amrita Ahuja put it yesterday,_ "there's absolutely a case for every balance sheet to have bitcoin on it"_. Regardless of this current bull run, we're still incredibly early in the adoption curve. Tesla taking no more than 1-3% of revenue in bitcoin provides an organic way for the company to build its holding organically with no effect on its day to day commitments.




Is there enough BTC for every Balance sheet to have bitcoin on it?
The companies holding BTC still value it in terms of Fiat, how do you transition away from the fiat valuation?
There are roughly 18.5m Bitcoins mined but according to this research there are only 4.2m in circulation, and the liquidity will further deteriorate as more corporations buy and hold on their balance sheet. The research points to companies like Microstrategy and FIs buying large quantities and hoarding. Given that the companies holding BTC are only a tiny fraction of public companies what will happen to the network as liquidity dries up? In this case, scarcity is an issue and is probably part of the reason why corporates don't hold Gold on their balance sheets (physical storage costs beng the other).

This is not an aspect that Satoshi had planned for, as the use case was a currency with constant circulation. The liquidity is one area I haven't looked into much, so keen to hear the thoughts of others on this forum.


----------



## tecate

Duke of Marmalade said:


> @tecate fair point on the ridiculous use of the term QE.  But the cult isn‘t above using misleading terms. “Mining” indeed. “Digital Gold”.


Use of the term 'Quantitative Easing' is a deliberate  exercise in obfuscation. The other terms you mention - go the other way in trying to affix understandable terms to what can be a technical subject for many. That's the difference.
As regards 'cult' - those who were/are enthusiastic about the role of gold have been tarred and feathered  as a cult also. However, have a look at this nonsense and you see where the real cult is.


----------



## WolfeTone

Duke of Marmalade said:


> But the cult isn‘t above using misleading terms.



Surely you mean "the cult*s*...."? 

Surely we are beyond pretending that the Central Banks operate a sound monetary system?


----------



## Duke of Marmalade

This is how the cult depicts bitcoin.
*1BvBMSEYstWetqTFn5Au4m4GFg7xJaNVN2  *is what it really looks like.

QE?  Is there a better term?  I suppose Monetary Easing or Monetary Accommodation would be better.
Mining?  Performing zillions of trial and error puzzles would be better.


			
				theo said:
			
		

> Surely we are beyond pretending that the Central Banks operate a sound monetary system?


I was going to address this quoting official statistics.  But what's the point?  The cult rejects all official statistics as a grand conspiracy where they don't support the narrative.


----------



## tecate

Duke of Marmalade said:


> This is how the cult depicts bitcoin.


Yeah, that makes a lot of sense your dukeness! So Satoshi used a  '₿' symbol to represent bitcoin?  Big deal - and false equivalence.  There's no religious/masonic/cult connotations as in the case of the USD.



Duke of Marmalade said:


> *1BvBMSEYstWetqTFn5Au4m4GFg7xJaNVN2  *is what it really looks like.


That's incorrect. That's a bitcoin wallet address. Be reasonable.


Duke of Marmalade said:


> QE?  Is there a better term?  I suppose Monetary Easing or Monetary Accommodation would be better.


Again, be reasonable! It's unrestricted money printing/ issuance.


Duke of Marmalade said:


> Mining?  Performing zillions of trial and error puzzles would be better.


Use of the term mining doesn't deliberately lead people astray. Use of the term Quantitative Easing does.


----------



## WolfeTone

Duke of Marmalade said:


> QE? Is there a better term? I suppose Monetary Easing or Monetary Accommodation would be better.



Magic money tree printing.



Duke of Marmalade said:


> The cult rejects all official statistics as a grand conspiracy where they don't support the narrative.



I accept all the official statistics, I don't accept that they are sourced from a sound monetary system. 
Who does anymore?


----------



## DublinHead54

Dublinbay12 said:


> Is there enough BTC for every Balance sheet to have bitcoin on it?
> The companies holding BTC still value it in terms of Fiat, how do you transition away from the fiat valuation?
> There are roughly 18.5m Bitcoins mined but according to this research there are only 4.2m in circulation, and the liquidity will further deteriorate as more corporations buy and hold on their balance sheet. The research points to companies like Microstrategy and FIs buying large quantities and hoarding. Given that the companies holding BTC are only a tiny fraction of public companies what will happen to the network as liquidity dries up? In this case, scarcity is an issue and is probably part of the reason why corporates don't hold Gold on their balance sheets (physical storage costs beng the other).
> 
> This is not an aspect that Satoshi had planned for, as the use case was a currency with constant circulation. The liquidity is one area I haven't looked into much, so keen to hear the thoughts of others on this forum.



Does anybody want to opine on this? I was hoping for some positive discussion on the back of this topic.


----------



## DazedInPontoon

Dublinbay12 said:


> Is there enough BTC for every Balance sheet to have bitcoin on it?


yes. There is not enough BTC for every balance sheet to have the number of bitcoins that firms like MicroStrategy and Tesla have accumulated, but there is enough BTC for every balance sheet to have as much as they need in terms of fiat value. The price per BTC in fiat rises as required.


Dublinbay12 said:


> The companies holding BTC still value it in terms of Fiat, how do you transition away from the fiat valuation?


It might happen, it might not. There is no necessity for it to happen, and it seems unlikely unless BTC is much more stable.


Dublinbay12 said:


> There are roughly 18.5m Bitcoins mined but according to this research there are only 4.2m in circulation, and the liquidity will further deteriorate as more corporations buy and hold on their balance sheet.


The liquidity in terms of bitcoin or in terms of dollar value of liquid bitcoin? I think everyone considers bitcoin, as a whole, more liquid today with 4.2m in ciculation that it might have been years ago with 8m in circulation but with each one only worth $50.


Dublinbay12 said:


> The research points to companies like Microstrategy and FIs buying large quantities and hoarding. Given that the companies holding BTC are only a tiny fraction of public companies what will happen to the network as liquidity dries up?


The price per BTC in fiat rises as required.


Dublinbay12 said:


> In this case, scarcity is an issue and is probably part of the reason why corporates don't hold Gold on their balance sheets (physical storage costs beng the other).


I disagree. In fact I think it is *more* in your interest to accumulate a treasury asset if the action of doing so will raise the value of the asset, as happened with MicroStrategy buying bitcoin. The scarcer something is the more of such an effect you'll see. The price per BTC in fiat rises as required.


Dublinbay12 said:


> This is not an aspect that Satoshi had planned for, as the use case was a currency with constant circulation. The liquidity is one area I haven't looked into much, so keen to hear the thoughts of others on this forum.


Satoshi explicitly likened btc to gold in his communications, and it played a part in how bitcoin was modeled. He knew the consequences of an ultimately fixed eventual supply.


----------



## DazedInPontoon

Also back in October you said


Dublinbay12 said:


> I am not really sure what this does for price stability, if most of the BTCs in the world are held in wallets and not circulating.


and I replied:


> Personally I think it will be absolutely terrible for stability, as bitcoin is propelled to the moon with this as the catalyst in the next year or so.


and here we are.

(source https://www.askaboutmoney.com/threa...l-gold-crashing-right-now.216478/post-1687726)


----------



## DublinHead54

DazedInPontoon said:


> The liquidity in terms of bitcoin or in terms of dollar value of liquid bitcoin? I think everyone considers bitcoin, as a whole, more liquid today with 4.2m in ciculation that it might have been years ago with 8m in circulation but with each one only worth $50.



Can you explain what you mean here? A bitcoin is a bitcoin, the equivalent dollar value doesn't impact the liquidity of the asset. If there were 8m Bitcoin in circulation vs 4 million then by a matter of fact the 8m had more liquidity. 



DazedInPontoon said:


> Also back in October you said
> 
> and I replied:
> 
> and here we are.
> 
> (source https://www.askaboutmoney.com/threa...l-gold-crashing-right-now.216478/post-1687726)



Yes the drying up of liquidity / scarcity has been a factor in the large uptake. 




DazedInPontoon said:


> yes. There is not enough BTC for every balance sheet to have the number of bitcoins that firms like MicroStrategy and Tesla have accumulated, but there is enough BTC for every balance sheet to have as much as they need in terms of fiat value. The price per BTC in fiat rises as required.


This doesn't make sense because in terms of USD value BTC is a volatile asset, so If want to hold BTC with a dollar equivalent of $1m on my balance sheet the position will need to be constantly adjusted as the BTC/USD exchange rate changes. However, the point is to move away from pricing BTC in Dollars and BTC be a standalone unit.


----------



## DazedInPontoon

Dublinbay12 said:


> However, the point is to move away from pricing BTC in Dollars and BTC be a standalone unit.


I expect your confusion is coming from this assumption. I don't think people are moving away from pricing BTC in dollars, and are therefore measuring the liquidity in terms of the total dollar value of liquid BTC.


----------



## DublinHead54

DazedInPontoon said:


> I expect your confusion is coming from this assumption. I don't think people are moving away from pricing BTC in dollars, and are therefore measuring the liquidity in terms of the total dollar value of liquid BTC.



@DazedInPontoon I am not confused, it appears that you have confused two separate topics in my response and misquoted. I am not sure how that happened given I responded individually to each of your comments, so it should be clear that the above quote was not in response to managing volatility on the balance sheet and not market liquidity. In comment number 494 I asked you to explain what you meant that bitcoin is more liquid now because the dollar value is higher. 

I would appreciate if you could respond back to the questions (much like you did earlier) line by line? My understanding of how market liquidity works clearly is different to yours, so I'd like to understand how you arrived at those comments. My understanding in this context is the dollar value is just a reporting metric, the same way as there is a Euro equivalent. The $ value doesn't change the circulating supply of BTC at a given point. Can you explain what you meant by the dollar value of BTC impacts the liquidity?

I assume what you actually meant was there are more participants in the market now in part because of the price rise and that is impacting liquidity?


----------



## galway_blow_in

Duke of Marmalade said:


> I was thinking of replacing my 8 year old car.  I see it is about the same price as it was 8 years ago but probably better spec.  But I do have sympathy with Saylor who probably does not have the same situation with his yacht.



you have an eight year old car which is worth the same today as it was eight years ago ?

is it an Aston Martin DB 9 ?


----------



## Duke of Marmalade

My understanding of liquidity is how much can you buy or sell of a quantity without your actual transaction materially moving the price.


WolfeTone said:


> I accept all the official statistics, I don't accept that they are sourced from a sound monetary system.
> Who does anymore?


_Wolfie _I don't know where you live but are you seeing folk in your neighbourhood with wheelbarrows of € notes?  Everything looks very normal in these parts. Shopkeepers are happy with the fiat and as far as I know most people are happy to work for fiat and will even let any surplus accumulate in their current accounts earning nothing.  I am unaware of any folk demanding to be paid in btc.  I admit the Irish Times now costs €2.30 when it used to cost €2.00.  Admittedly I see folk wearing masks as they go shopping which I didn't see before but I don't think this is out of shame for cheating the shopkeeper with their dud fiat.
But of course if you enjoy wallowing in a belief that the whole caboodle is a sham and the end of our world is nigh, it would be unfair of me to try and persuade you from the comfort of your fantasy.


----------



## Duke of Marmalade

galway_blow_in said:


> you have an eight year old car which is worth the same today as it was eight years ago ?
> 
> is it an Aston Martin DB 9 ?


The salesman left a lucky bitcoin in the glove compartment.  I thought it was a trivial gesture at the time.


----------



## tecate

Duke of Marmalade said:


> _Wolfie _I don't know where you live but are you seeing folk in your neighbourhood with wheelbarrows of € notes?  Everything looks very normal in these parts. Shopkeepers are happy with the fiat and as far as I know most people are happy to work for fiat and will even let any surplus accumulate in their current accounts earning nothing.  I am unaware of any folk demanding to be paid in btc.  I admit the Irish Times now costs €2.30 when it used to cost €2.00.  Admittedly I see folk wearing masks as they go shopping which I didn't see before but I don't think this is out of shame for cheating the shopkeeper with their dud fiat.
> But of course if you enjoy wallowing in a belief that the whole caboodle is a sham and the end of our world is nigh, it would be unfair of me to try and persuade you from the comfort of your fantasy.



_Wolifie_, I don't know where you live but are you seeing folk in your neighbourhood epically dissatisfied with the horse and buggy? Everything looks very normal in these parts. Horse and buggy owners are happy with their horses and buggies and as far as I know most people are happy to travel wherever they want with their horse and buggy. I am unaware of anyone in my circle who's demanding change and looking to buy one of these new fangled motor cars. Admittedly, I see people wearing masks as they go  round town what with all the horse dung but this creates much needed employment for the dung shovelers in the city. 
But of course if you enjoy wallowing in a belief in this new fangled motor car idea and how it will change things, it would be unfair of me to try and persuade you from the comfort of your fantasy. However, I will say these contraptions of yours are frightening man and beast so I'm happy to see new regulation that requires you to have someone run in front of that hideous contraption of yours waving a red flag to warn the local townsfolk.


----------



## DublinHead54

So this thread has just turned into the usual pontification between a few users. I was hoping my queries on liquidity would have been answered, but I am assuming it has been purposefully ignored. I'll go and do a bit of research and see what I can find.


----------



## Duke of Marmalade

@tecate so that is where the cult has got to.  Bitcoin is to the dollar what the motor car was to the pony and trap.  The cult has moved a long way from its modest aspiration to coexist with fiat supplying a niche demand.
@Dublinbay12 apologies for not engaging on the liquidity issue.  As I understand your point, you are saying if there is mass corporate take up as a store of value/reserve ala Microstrategy/Tesla there won't be enough left to act as a medium of exchange. But please correct me if that is a misinterpretation.
The reason I find it hard to engage is that I can't see that mass take up and I certainly can't see it acting as a medium of exchange in any meaningful way.
But as a thought experiment let's consider that there is a massive demand for bitcoin on both fronts, store of value and medium of exchange.  I suppose the straight answer is that the price will take up the slack.  Bitcoin is valued at $1trn today but there is no substance to that, it is simply supply and demand.  If there is a demand for $5trn on company's balance sheets and a similar demand as a medium of exchange then its price will increase 10 fold to $500k as some predict.  There is as much sense to bitcoin being valued at $50k, $500k, $1.


----------



## tecate

Duke of Marmalade said:


> @tecate so that is where the cult has got to.  Bitcoin is to the dollar what the motor car was to the pony and trap.  The cult has moved a long way from its modest aspiration to coexist with fiat supplying a niche demand.


You conspire to miss the point at every turn, your dukeness. And that point - in this instance - was a reference to the attitude of those that ignored innovation and change in the past and your attitude and resistance to change.
On a number of instances during the course of these discussions, Brendan has made a book recommendation - Extraordinary Popular Delusions & The Madness of Crowds. It's well worth reading. However, it's by far and away not the only thing that needs to be on the reading list for those with an interest in this subject area.
"Who Moved My Cheese?" - I'd cancel that IT subscription your dukeness and get on that one as soon as possible if I was in your shoes. 
Like everything else, monetary systems evolve - and you can change with it or get left behind.
Oh, and incidentally, my belief that sovereign money will exist/compete alongside decentralised money has not changed. On the sustained 'cult' tar and feathering...
Fiat: “In God We Trust” 
Bitcoin: “Don’t Trust, Verify”


----------



## Duke of Marmalade

@tecate Unlike some others, I actually take a positive view when people turn the debate into ad hominem insults against me, shows that I am winning the substantial debate.  As a reminder this latest foray is in response to _Wolfie _asking rhetorically whether anybody believed in our monetary system any more.  I think I answered that comprehensively by reference to what I see around me.


----------



## tecate

Duke of Marmalade said:


> I actually take a positive view when people turn the debate into ad hominem insults against me, shows that I am winning the substantial debate.


I fail to see how you've been insulted and I reject the ad hominem charge. I also think that your approach is wayward. I'm here to discuss and to learn - not to 'win'.



			
				Duke of Marmalade said:
			
		

> As a reminder this latest foray is in response to _Wolfie _asking rhetorically whether anybody believed in our monetary system any more.  I think I answered that comprehensively by reference to what I see around me.


And I maintain that there is plenty of food for thought for you in my response. There's a wealth of evidence that many intelligent people can't get their heads round digital assets because they can't deal with change. From millenials downward, those people are far more comfortable with digital/virtual assets/currencies than those older than them. More-so as you go further down the age range.
My post was written with this in mind. It was also written with an eye towards folks not seeing how something could have advantages over existing systems. You could ponder it in those terms or you can climb back into your bunker and decide to interpret that as an insult and plot on how you will 'win'. Your choice.


----------



## Duke of Marmalade

tecate said:


> I fail to see how you've been insulted and I reject the ad hominem charge. I also think that your approach is wayward. I'm here to discuss and to learn - not to 'win'.
> 
> 
> And I maintain that there is plenty of food for thought for you in my response. There's a wealth of evidence that many intelligent people can't get their heads round digital assets because they can't deal with change. From millenials downward, those people are far more comfortable with digital/virtual assets/currencies than those older than them. More-so as you go further down the age range.
> My post was written with this in mind. It was also written with an eye towards folks not seeing how something could have advantages over existing systems. You could ponder it in those terms or you can climb back into your bunker and decide to interpret that as an insult and plot on how you will 'win'. Your choice.


A load of not very clever not very funny baloney about ponies and traps does not add to the debate as to whether folk still have confidence in the monetary system.


----------



## tecate

Duke of Marmalade said:


> A load of not very clever not very funny baloney about ponies and traps does not add to the debate as to whether folk still have confidence in the monetary system.


What it does do, your dukeness, is inform the discussion that people can often have issues in mapping out where an innovative technology can take us. It speaks to exactly that.


----------



## DublinHead54

I'm sorry @tecate @Duke of Marmalade this thread is not a debate or a place that welcomes discussion and an environment to learn. It revolves around you two trying to outsmart each other with overly long posts. 

The other side is one that doesn't welcome discussion and any slight critique or questioning is shot down.

In the last few days I've posted questions about liquidity issues hoping to discuss that. I've used the same source as @tecate has used previously as evidence. Yet nobody wants to discuss this topic, and it's just been ignored. 

Would it not be better for this forum if you moved your discussion to a private message?

You've clearly lost the crowd here and what ever interesting developments you want to advertise is lost in the rest of your messages trying to outsmart each other.


----------



## WolfeTone

Duke of Marmalade said:


> _Wolfie _I don't know where you live but are you seeing folk in your neighbourhood with wheelbarrows of € notes? Everything looks very normal in these parts.


No wheelbarrows full of € Duke, not yet anyway. I'm watching an interview with LaGarde on Bloomberg. "_Whatever it takes"_ economic policy is alive and well and will be here for quite some time yet.
Worth a watch on YT.
Now I accept I tend to come at these things with a view heavily dosed in scepticism. But I qualify that scepticism against 20yrs or so of observing these central bankers talking a lot of nonsense and spouting delusion after delusion.

"_We are guided by persevering favourable financing conditions_" - LaGarde.
It is an impressive hook-line for sure, but she then explains that the policy is to apply the €1.8trn ECB purchasing program partially, in whole, or even more if needed!
This is not policy, this is make-it-up-as-we go along.

The interviewer asks "_Draghi never got to hike rates, can you imagine yourself in the same position?" _
LaGarde "_We shall see... I hope... we are not seeing conditions yet to raise rates for some time" _
I translate that to mean the 'policy' doesn't work.




Duke of Marmalade said:


> Shopkeepers are happy with the fiat and as far as I know most people are happy to work for fiat and will even let any surplus accumulate in their current accounts earning nothing.




Duke, the shopkeepers and retailers are happy because the shopkeepers and retailers cannot be allowed to be anything but happy. Why borrow from a bank to cover wage bill paying interest rates when the Revenue can help you out for free?
If the retailers, and by extension the consumers are not happy, then the resulting consequences spell trouble.
It is why the chaos is occuring in asset markets. Bonds yields at record lows and stock markets at record highs, property prices at near all times highs again, and  the customary anecdotal stories of art works going for ridiculous prices.
Bitcoin at $50,000 is also part of this chaos.



Duke of Marmalade said:


> But of course if you enjoy wallowing in a belief that the whole caboodle is a sham



It is not a sham, it is very real. People actually believe the ECB can manage and monitor an entire monetary and economic union of diverse ecomonies and provide stability.


----------



## Duke of Marmalade

Dublinbay12 said:


> In the last few days I've posted questions about liquidity issues hoping to discuss that. I've used the same source as @tecate has used previously as evidence. Yet nobody wants to discuss this topic, and it's just been ignored.


I did make a belated attempt to address your liquidity point. 
I don't think you are using the usual definition of liquidity but correct me if I am wrong.
Your definition:  will there be enough bitcoin to serve the twin demands of balance sheet and medium of exchange?
Conventional definition:  how much* can be offloaded at current prices without affecting the price?
The answer to both is all in the price and the reality (some will say the beauty) with bitcoin is that it can be any price that its users make it.
Now when it cost 10,000 btc to buy 2 pizzas, even if the whole 21m were in circulation their combined value would just about buy a middle range car.  And I guess the guy who sold the 2 pizzas, if he tried to cash them in immediately would find he got maybe half the dollar value that he thought he was selling them for.
Or maybe you are focussed on the quantity of bitcoin.  21m does not sound like a lot but that is 2,100 trillion satoshis if viewed from the smallest unit.
_* The expression "how much?" implies a numeraire, which is usually the operating currency of the person asking the quastion._


----------



## tecate

WolfeTone said:


> No wheelbarrows full of € Duke, not yet anyway.


No wheelbarrows  but its a heck of a low bar if that's what's deemed to be a success in the world of fiat! There's plenty of stealth taxing that can be done without the wheelbarrows. And of course, there's never  a year where there isn't a need for those wheelbarrows of worthless paper somewhere on the planet. I get that hard money can be a lot more appreciated in countries with greater risk of monetary/fiscal mismanagement but any assessment of it has to go beyond what it can/can't do for the individual as its available globally - not just in Ireland.



WolfeTone said:


> "_Whatever it takes"_ economic policy is alive and well and will be here for quite some time yet.


Indeed it is. Fiat money is the grander experiment here - not bitcoin. People seem to forget that unbacked sovereign currency is a relatively recent phenomenon. As regards '_whatever it takes_', whenever I ask anyone how much money printing is too much money printing, nobody seems to have an answer.
I put this to the Duke some months back and he said he was concerned about the rampant money printing but that he'd have to have faith in the central bankers. Bitcoin comes at this from the polar opposite corner (don't trust, verify) - so people can decide which lends itself to cult-like behaviour.



WolfeTone said:


> This is not policy, this is make-it-up-as-we go along.


Yup, which is why nobody has an answer here or anywhere else. Nobody knows because fiat money is the bigger experiment.



WolfeTone said:


> Bitcoin at $50,000 is also part of this chaos.



Very much so. I came across this tweet the other day. I think its very poignant in this regard (and in relation to a discusion around the accuracy of CPI in recent days):


__ https://twitter.com/i/web/status/1377309612823740422


----------



## Duke of Marmalade

WolfeTone said:


> No wheelbarrows full of € Duke, *not yet anyway*.


You live in hope.


WolfeTone said:


> Duke, the shopkeepers and retailers are happy because the shopkeepers and retailers cannot be allowed to be anything but happy.


I presume you are referring to the fact that by fiat shopkeepers are required to accept euro.  I often wonder do you actually believe this stuff.  Do you really think that my local shopkeeper would prefer I paid him with vegetables from the garden or maybe bitcoin?
In any case if he is so reluctant to accept euro hasn't he the obvious remedy.  It's called bitcoin.  Remember it's censorship free.  He could every hour bank his dud euros by topping up his bitcoin account.  Maybe this is indeed happening on a grand scale.  Have you any evidence that this is happening?

I see some cult propaganda from @tecate.  It predicts money supply up 24%.  That is hardly rampant printing.


----------



## tecate

Duke of Marmalade said:


> I see some cult propaganda from @tecate.  It predicts money supply up 24%.  That is hardly rampant printing.


Increasing money supply by a quarter isn't rampant money printing? If you say so, Dukey.  Here's a WP article that puts things in perspective:





(on the cult reference...

Fiat: “In God We Trust”
Bitcoin: “Don’t Trust, Verify”  )


----------



## WolfeTone

Duke of Marmalade said:


> You live in hope



Not at all, Duke. But just in case I have purchased a small amount of bitcoin to protect myself.
It would appear I'm not alone in that line of thinking.



Duke of Marmalade said:


> I presume you are referring to the fact that by fiat shopkeepers are required to accept euro.



No, what I'm referring to is the price stability of essential goods, like food.

The too-big-to-fail approach of saving financial institutions has now extended, because of Covid, to every man, woman and child and business.
It is an honourable approach, but it is not borne out of political altruism, it is borne out of political necessity. Because if too many Joe & Josephine Public go under then that is recipe for chaos.
So asset prices are completely skewed and make little sense. Price discovery is being tarred over, so that bread and butter remains stable. 

I hope you get to watch the LaGarde interview from yesterday. She certainly delivers the soundbites, but more significant is the line of questioning from the interviewer. The questions offer more insight than the answers.


----------



## Duke of Marmalade

tecate said:


> Increasing money supply by a quarter isn't rampant money printing? If you say so, Dukey.  Here's a WP article that puts things in perspective:
> 
> 
> 
> 
> 
> (on the cult reference...
> 
> Fiat: “In God We Trust”
> Bitcoin: “Don’t Trust, Verify”  )


Effect of the pandemic on Money Supply so far
$ MS up from 15.5 to 19.4
£ MS up from 2.5 to 2.8
€ MS up from 12.8 to 13.8
Actually I was pleasantly surprised by these figures.  The following is how the professionals view the outlook for medium term inflation in the eurozone.




This is from the French market.  The inflation breakeven is where the gnomes of Paris and Zurich are placing their trillions of € on inflation rates out to 2028.  Their estimate: 0.8%.  I can live with that though Mme Lagarde may have something to say about it as she targets a massive 2%.
_Caution:  the above chart is absolutely useless for those who measure their inflation expectations in terms of the price of yachts or who believe the official calculation of inflation is completely crooked._


----------



## Duke of Marmalade

WolfeTone said:


> No, what I'm referring to is the price stability of essential goods, like food.


Not sure I understand the point.  We are discussing the rhetorical question you raised as to whether anybody trusts the monetary system any more.  I argued that from my own experience most people seem to have no difficulty in using euro as they always had.  Price stability of core goods is certainly part of that.  Are you now answering you own question that folk are happy with the euro but only because they have to be happy?  Stability is a good thing and if we have stability because folk want it, I can't see what the problem is.  Are you saying that deep down everyone knows, like you, that the monetary system is a complete can of worms but have formed a sort of implicit consensus not to open that can?


WolfeTone said:


> The too-big-to-fail approach of saving financial institutions has now extended, because of Covid, to every man, woman and child and business.
> It is an honourable approach, but it is not borne out of political altruism, it is borne out of political necessity. Because if too many Joe & Josephine Public go under then that is recipe for chaos.


I agree that altruism is a very rare commodity restricted to those who follow saintly lives.  But still I am glad that I live in a system where the selfish interest of the "elites" is to keep Joe and Josephine on side.


WolfeTone said:


> So asset prices are completely skewed and make little sense. Price discovery is being tarred over, so that bread and butter remains stable.


Agree with the first point.  Not sure I understand the second point.


----------



## tecate

Are these the ECB's projections? Can you provide a link to that data please?

Do you see yacht price inflation itemised in post # 511 above? (oh, and congratulations once again on your conversion to socialism!). I don't see that listed but I do see a whole host of commodities skyrocketing in price - and food up 25%. You know....things that people need to live.
Message received on not daring to question official figures - I guess this is in line with your _hoping_ that the ECB can fix their mess. Accepting official data unquestioningly is in line with your cultist ways.


----------



## RedOnion

tecate said:


> Are these the ECB's projections? Can you provide a link to that data please


No, not ECB projections.
The chart is based on the yields on inflation linked bonds. It just infers the market expectations of inflation by looking at the difference in yield on OATi bonds Vs normal government bonds.
So for bonds with a 2028 maturity, the money markets are pricing an inflation expectation of 0.7%


----------



## Duke of Marmalade

This is the source of the figure in #515.  It is an official website of the French government.  But the inflation expectations have nothing to do with any official projections.  It is what the gnomes are betting their very considerable trillions on the outlook for official inflation.  I personally give it more credibility than a tweet from Reddit investors.
It is clear now that the fear of hyperinflation is partly behind the btc surge, although the Muskie effect has also been enormous.  If the gnomes are right or even if Mme Lagarde has her wicked way and gets inflation up to 2% I can't see the hyperinflation insurance aspect of btc lasting till 2028.


----------



## RedOnion

Duke of Marmalade said:


> I personally give it more credibility than a tweet from Reddit investors


You mean a tweet that shows the prices of a select number of commodities, some of which have recovered back to the levels they were a few years ago, before falling sharply?


----------



## WolfeTone

Duke of Marmalade said:


> Agree with the first point. Not sure I understand the second point.



Bond yields are being driven to zero by ECB to facilitate cheaper (free) borrowing. 
Without it interest rates rise, inflation etc. 

But if this was a panacea against long-term economic instability then it would be permanent policy, would it not? 
But the CBs are clear, these are not permanent measures... why? Well, because it is not sustainable. And if it is not sustainable, then there has to be consequence. 
How, when, or in what form, those consequences emerge nobody knows.


----------



## RedOnion

WolfeTone said:


> Bond yields are being driven to zero by ECB to facilitate cheaper (free) borrowing.
> Without it interest rates rise, inflation etc


How do higher interest rates lead to higher inflation? I'd love to see the theory behind that if you get a chat to explain it.

You do realise that the reason CBs are printing money is to create inflation? A small amount of inflation is a good thing for economic growth.


----------



## WolfeTone

RedOnion said:


> How do higher interest rates lead to higher inflation?



I never said it leads to higher inflation. 
I suggested that without ECB intervention inflation would good higher. 



RedOnion said:


> You do realise that the reason CBs are printing money is to create inflation?



Yeh, how has that been working out so far?


----------



## RedOnion

WolfeTone said:


> I suggested that without ECB intervention inflation would good higher.


And that suggestion makes absolutely no sense, and flies in the face of all economic theory.
You're suggesting that if there was less money, prices would be higher?

It's impossible to have a discussion if you're not going to at least try to base it in reality.



WolfeTone said:


> Yeh, how has that been working out so far?


It's not working as well as they want, but based on your comments above I'm guessing you haven't factored in that we'd be in a massive deflationary period without the intervention?


----------



## WolfeTone

RedOnion said:


> You're suggesting that if there was less money, prices would be higher



No, I'm suggesting if there no ECB interference the cost of borrowing will rise... a not insignificant factor in setting prices.


----------



## RedOnion

WolfeTone said:


> No, I'm suggesting if there no ECB interference the cost of borrowing will rise... a not insignificant factor in setting prices.


That still contradicts all accepted economic theory.


----------



## tecate

RedOnion said:


> You mean a tweet that shows the prices of a select number of commodities, some of which have recovered back to the levels they were a few years ago, before falling sharply?


That's fair enough on the source - it was posted on the understanding that its indicative. Authoritative data outside of official sources is hard to come by. 

On the whole, my understanding is that technology is driving a deflationary world and that the battle overall has been against deflation. However, on the flip side we have money printing like we've never seen before. Some items may very well continue to be deflationary but that doesn't account for all items. Who's to say that CBs and governments have proper control in what they're tinkering with? 
On statistical analysis of data re. CPI, I don't share the Duke's same level of unquestioning  confidence. Government agencies responsible for such analysis have been roundly criticised on the misrepresentation of data going back donkeys years.

Can you clarify for us what level of CB balance sheet expansion is too much? If we're ok with magically creating more Euro's, can I tell Revenue that I've asked the ECB to print off my tax bill and that they should contact them for payment on my behalf? Where do we draw the line?  Is there a line and if there is, does anyone have any earthly idea where it is?


----------



## tecate

Duke of Marmalade said:


> It is clear now that the fear of hyperinflation is partly behind the btc surge, although the Muskie effect has also been enormous.  If the gnomes are right or even if Mme Lagarde has her wicked way and gets inflation up to 2% I can't see the hyperinflation insurance aspect of btc lasting till 2028.


Duke, going back a few months, you said that the btc price performance was unimpressive given the extent of the rampant money printing. I think bitcoin was around $15k at the time. You also said that you were concerned at the level of money printing. Are you now saying you were mistaken?


----------



## WolfeTone

RedOnion said:


> That still contradicts all accepted economic theory



Not really, its just chicken and egg stuff along the business cycle.


----------



## RedOnion

tecate said:


> On statistical analysis of data re. CPI, I don't share the Duke's same level of unquestioning confidence. Government agencies responsible for such analysis have been roundly criticised on the misrepresentation of data going back donkeys years.


There are lots of different measures for inflation.  As you've mentioned the one that economists like is 'core inflation' which excludes certain items which can fluctuate a lot over short cycles, as it's a better reflection of the drivers of the economy.
However, the one we normally hear about is CPI, which includes food & fuel, etc. but might exclude items like tobacco or alcohol.  It's also the one that most inflation linked bonds are linked to.  Why is that important?  Well, because there are trillions or euro linked to it.  If Central Banks were messing around with the numbers to keep CPI lower, then the holders of the bonds would keep them in check as it impacts on their returns.  I would say that the increase of the volumes of inflation linked bonds is adding to the confidence level of CPI figures.


----------



## RedOnion

WolfeTone said:


> Not really, its just chicken and egg stuff along the business cycle.


With all due respect, you're just making stuff up now.
You are at the very least confusing correlation with causation.  In this case, the chicken & egg cycle is very clearly understood.


----------



## Duke of Marmalade

tecate said:


> Duke, going back a few months, you said that the btc price performance was unimpressive given the extent of the rampant money printing. I think bitcoin was around $15k at the time. You also said that you were concerned at the level of money printing. Are you now saying you were mistaken?


Not at all.  In fact I should have backed my intuition.  $15k was too low for the spectre of hyperinflation that the official reaction to Covid had definitely spooked.  Though I am not sure how much of the rise since then is due to hyperinflationary fears or the Muskie effect.
These are definitely uncharted waters.  When I was studying financial mathematics a typical text book would show examples of the risk free interest rate being 5%.  And it was taken as beyond logical dispute that zero was the lower bound for interest rates (despite instances of negative rates on the Ch Fr).  Today € interest rates are negative up to 10 years and the 30 year yield is 0.5%.  I can hardly get my head around that.
Monetary policy in the modern world is very complex indeed.  It might go wrong.  I would like insurance against that but I don't see any realistic way to get that insurance, certainly not bitcoin.  Unlike some in this parish, I trust the motivations and expertise of the monetary authorities in their efforts to steer us through this (this is not Zimbabwe) but as I say it might go wrong.
If the gnomes are right and we get to 2028 with very subdued inflation  I think bitcoin will have its BOHA moment.  The surge to $60k, driven by hyperinflation fear and Muskie syndrome,  is a threat to bitcoin's long term sustainability IMHO.


----------



## WolfeTone

RedOnion said:


> With all due respect, you're just making stuff up now.



I'm not really, honest. 
The asset purchasing programs by Central Banks over the last 6/7yrs have no resulted in the desired effect - target of 2% inflation rate. There is nothing theoretical about it, it is a fact. It hasn't worked. It has increased asset prices, go figure! 

On the other hand, the US Gov proposal for a 1.8trn infrastructure stimulus will, in my opinion, invoke the core inflationary spirits that they have sought for so long. Labour shortages will lead to wage increases, increased borrowing, increasing borrowing costs - if CBs stop interfering, then increasing prices.


----------



## RedOnion

WolfeTone said:


> I'm not really, honest.
> The asset purchasing programs by Central Banks over the last 6/7yrs have no resulted in the desired effect - target of 2% inflation rate. There is nothing theoretical about it, it is a fact. It hasn't worked. It has increased asset prices, go figure!


No, you are way out of your depth on very basic economic theory.

You are suggesting that if central banks hadn't intervened, then interest rates would be higher (fully agreed), but that that increased interest rate would in turn have led to inflation????

That makes absolutely no sense at all.


----------



## WolfeTone

RedOnion said:


> I'm guessing you haven't factored in that we'd be in a massive deflationary period without the intervention?



Indeed, but it very much dependent on other factors. The interest rate is not the sole factor in determining inflation rate. If it were then inducing a 2% inflation rate would be easy. 
Debt ratios is also a major factor, sovereign debt, corporate debt, personal debt. 




RedOnion said:


> You are suggesting that if central banks hadn't intervened, then interest rates would be higher (fully agreed), but that that increased interest rate would in turn have led to inflation????



I'm saying that if CBs stopped (or reduced) interferance now cost of borrowing will rise and this in turn will lead to higher prices. 
The opposite of course is to believe that the CB intervention will lead to higher prices... how is that working out? 
It has led to higher asset prices, so if you are trying to purchase a house arguably inflation is already way beyond 2%. 
However the cost of borrowing that money to buy the house has fallen so arguably the CB interference has led to that massive deflationary period you mentioned earlier? 

Which is it? One persons inflation is another person's deflation. 
I accept this may be a bit nuanced and beyond the basic economic standard theory. 
But as fact, going by the ECBs stated aim to target a 2% inflation rate through asset purchasing program the results have been derisory.


----------



## tecate

RedOnion said:


> There are lots of different measures for inflation.  As you've mentioned the one that economists like is 'core inflation' which excludes certain items which can fluctuate a lot over short cycles, as it's a better reflection of the drivers of the economy.


Wasn't the 'Core CPI' measurement utilised for many years for general reporting purposes?



			
				RedOnion said:
			
		

> I would say that the increase of the volumes of inflation linked bonds is adding to the confidence level of CPI figures.


That's interesting. Question, though. A bond offering that's inflation-linked is likely to be entered into by those that have an intimate knowledge of the applicable CPI measurement. That measurement may be consistent but it may still exclude items that are inflationary. Once again, my understanding is that technology is driving a deflationary environment  but that doesn't mean that every category/item is immune from inflation eg. there may well be considerable asset price inflation.


----------



## tecate

Duke of Marmalade said:


> It might go wrong.  I would like insurance against that but I don't see any realistic way to get that insurance, certainly not bitcoin.  Unlike some in this parish, I trust the motivations and expertise of the monetary authorities in their efforts to steer us through this (this is not Zimbabwe) but as I say it might go wrong.
> If the gnomes are right and we get to 2028 with very subdued inflation  I think bitcoin will have its BOHA moment.  The surge to $60k, driven by hyperinflation fear and Muskie syndrome,  is a threat to bitcoin's long term sustainability IMHO.


I agree - this is not Zimbabwe. However, as you rightly state, this could still go wrong. I assume that this is the reason that absolutely nobody seems to be able to answer how much money printing is acceptable and how much is too much.
On your long pursuit of this 'boha moment', I don't think its that straight forward, Duke. Monetary expansion was just icing on the cake as regards the utility of bitcoin. It has other facets to it.  Additionally, whilst you may live in a country/block that is comparatively better run from a currency standpoint, many don't. There are many Zimbabwe's - every year there are new examples.

Clearly, there's no measure by which you'll accept bitcoin as having reached escape velocity. I'm going to have to contact next of kin over the weekend to hand over posting 'privileges' here. Bitcoin could have reached a dollar a satoshi and be accepted for payment everywhere by then and you'll still be stuck in that trench pursuing the 'win' (as you described it)


----------



## RedOnion

WolfeTone said:


> I'm saying that if CBs stopped (or reduced) interferance now cost of borrowing will rise and this in turn will lead to higher prices.


Really really basic economic theory - increased cost of borrowing will reduce demand, and therefore prices.  Increasing interest rates is the most commonly employed policy to slow down inflation. The claims you are making are absolute nonsense in the truest sense of the word.



WolfeTone said:


> But as fact, going by the ECBs stated aim to target a 2% inflation rate through asset purchasing program the results have been derisory.


But, what would the level of deflation be if they hadn't intervened?


----------



## WolfeTone

RedOnion said:


> Really really basic economic theory - increased cost of borrowing will reduce demand, and therefore prices



I know, but what I'm trying to impart on you is that you need to go beyond really, really basic economic theory.
If inflation could be stoked using really, really basic economic theory, it would not be a problem to achieve it, would it?

So what you also have to factor in is where the stimulus is directed. CBs have pumped the balance sheets of sovereign states and financial institutions. As you admit, it has not worked as well as they hoped - even though, seemingly, it is really, really basic economic theory.

I refer to the economic cycle. I reference US 1.8trn infrastructure proposal, and I reference also increased levels of savings acquired during this pandemic.
These three factors, assuming a normal return to economic activity (or close to) will drive demand in US and EU. There will be labour shortages, there will be wage demands and the cost of borrowing will begin to increase.
Alongside it, for a period, the inflation rate. Interests rates will continue to rise, as will the inflation rate. At some point along the business cycle, the interest rate will become cost prohibitive, reducing demand. But it does not stand that increasing interest rates reduces demand and inflation, it can and does increase the cost of borrowing, inducing higher prices also.





RedOnion said:


> But, what would the level of



I don't know, what would the level of deflation be if they had not intervened? And for how long would it have lasted?


----------



## Duke of Marmalade

tecate said:


> I assume that this is the reason that absolutely nobody seems to be able to answer how much money printing is acceptable and how much is too much.


I think you may be getting a bit too caught up with your metaphor.  Physical printing presses are not the actual tool being used.  The ECB will make monetary conditions as easy or tight as it thinks is required to achieve its targets, and thankfully I agree with its targets and I have a reasonable amount of confidence that they will achieve them, there or thereabouts.  They have the tools to withdraw that so called "printed" money if they need to.  As I say, this is not Zimbabwe.  By contrast, Mugabe having literally printed zillions of Z$ could not withdraw them from circulation. You are trying to simplify beyond the bounds of simplification.  Satoshi might have thought 21m was a nice round number to hard code for all time.  The real world is not like that, and so you are destined to be frustrated in the search for the answer you are looking for.


tecate said:


> I don't think its that straight forward, Duke. Monetary expansion was just icing on the cake as regards the utility of bitcoin. It has other facets to it.


I just checked.  Bitcoin has increased in price 10 fold over the last 12 months.  Gold is exactly at the same price as it was a year ago.  So you are right.  The fear of hyperinflation cannot be a factor at all.  Muskie is good for some of the increase but please enlighten me as to the "other facets".


			
				tecate said:
			
		

> there may well be considerable asset price inflation.


Yes indeed, a very controversial area.  By definition assets are not consumables so they do not enter the CPI.  CPI is used for such things as pension planning and adjusting social welfare payments and informing collective wage bargaining.  Arguably it is the cost of living that is relevant here and not the cost of assets. But there is no doubt that QE has led to inflation in asset prices and a consequent increase in wealth inequality.  Is this deliberate CB policy or an unfortunate by product of the monetary easing?  I do not accept Big Short theory that it is a deliberate ruse to line the pockets of the elites.  But the increased wealth effect may be a not unwanted side effect.  I think in March last year the Fed were as concerned with the stock market crash as they were with the loss in employment induced by the pandemic.


----------



## RedOnion

tecate said:


> Wasn't the 'Core CPI' measurement utilised for many years for general reporting purposes?


I think 'core CPI' and 'core inflation' are just different terms for the same thing, depending on audience / jurisdiction. Open to correction on that though.



tecate said:


> Question, though. A bond offering that's inflation-linked is likely to be entered into by those that have an intimate knowledge of the applicable CPI measurement.


Yes, fair point. The 'market makers' of the bonds would understand exactly how CPI is calculated, and the consistency of it. The constituents and weighting of each are constantly reviewed, I remember a few years ago the Irish 'basket' was changed to better reflect the items households were actually buying.
Some of the criticism is that the basket doesn't reflect actual increases in household costs - as economies become more affluent, our tastes become more expensive (without talking about yachts!). However the CSO doesn't replace own brand goods with more expensive branded ones, although that might be what people are really buying.


----------



## tecate

Duke of Marmalade said:


> I think you may be getting a bit too caught up with your metaphor.  Physical printing presses are not the actual tool being used.



Duke, I'm aware that it's electronically created - they just add a couple of zeros on their centralised database - and voila. Not sure what your point is though?



Duke of Marmalade said:


> The ECB will make monetary conditions as easy or tight as it thinks is required to achieve its targets, and thankfully I agree with its targets and I have a reasonable amount of confidence that they will achieve them, there or thereabouts.


You mean - as you stated many months ago - you're trusting that they've got it right. You can't demonstrate if they have and probably neither can they.



Duke of Marmalade said:


> They have the tools to withdraw that so called "printed" money if they need to.  As I say, this is not Zimbabwe.  By contrast, Mugabe having literally printed zillions of Z$ could not withdraw them from circulation.


There are many Zimbabwe's  - at any given time, there's a list of Zimbabwe's. When considering bitcoin, that includes all the zimbabwe's in the world also. You don't get to leave them out.



Duke of Marmalade said:


> You are trying to simplify beyond the bounds of simplification.


No Duke....you can't answer the question - because you don't know. At what point do they print/issue/magic up too many euro? It's a very reasonable and important question. That its complex to answer is fair but not to know is dangerous as far as I can see.



Duke of Marmalade said:


> Satoshi might have thought 21m was a nice round number to hard code for all time.  The real world is not like that, and so you are destined to be frustrated in the search for the answer you are looking for.


That's both nonsense and a cop out.  Bitcoin is an entirely different monetary system in its own right - by design. By 'real world', you mean this keynesian system we inherited? You've identified that Mugabe printed/issued too much currency. Why is it unreasonable of me to ask what's too much when it comes to other currencies?  Your outlook/view here is completely faith based - faith.....the stuff of religions and cults.  Is this the reason that they have 'In God We Trust' on the US dollar? Should I be saying a few 'our fathers'? Maybe divine intervention will provide me with an answer to my question.



Duke of Marmalade said:


> I just checked.  Bitcoin has increased in price 10 fold over the last 12 months.  Gold is exactly at the same price as it was a year ago.  So you are right.  The fear of hyperinflation cannot be a factor at all.  Muskie is good for some of the increase but please enlighten me as to the "other facets".


12 months you say? And yet around 6 months ago you claimed that bitcoin hadn't appreciated anywhere near as good as gold. There is another theory by the way - and that's that bitcoin is beginning to be seen to have certain qualities that are superior to gold.



Duke of Marmalade said:


> Yes indeed, a very controversial area.  By definition assets are not consumables so they do not enter the CPI.  CPI is used for such things as pension planning and adjusting social welfare payments and informing collective wage bargaining.  Arguably it is the cost of living that is relevant here and not the cost of assets. But there is no doubt that QE has led to inflation in asset prices and a consequent increase in wealth inequality.  Is this deliberate CB policy or an unfortunate by product of the monetary easing?  I do not accept Big Short arguments that it is a deliberate ruse to line the pockets of the elites.  But the increased wealth effect may be a not unwanted side effect.


Wasn't 'Core CPI' used as the general reported measure of inflation for many years - introduced during a period of high inflation? It didn't include food, housing or energy.
I asked you the other day if the currently used measure - as generally reported - includes housing, health insurance and education?
What 'increased wealth effect'?


----------



## Duke of Marmalade

tecate said:


> Duke, I'm aware that it's electronically created - they just add a couple of zeros on their centralised database - and voila. Not sure what your point is though?


My point is that if you physically print money ala Zimbabwe, Lebanon, Venezuela, there is no way back.  If you buy up long bonds by injecting money you can reverse that by selling back the long bonds you bought.  Japan has been operating QE on and off for many yonks now, and no sign of it going badly wrong.


tecate said:


> You mean - as you stated many months ago - you're trusting that they've got it right. You can't demonstrate if they have and probably neither can they.


Trusting and hoping.  Human behaviour, which is the real focus of monetary policy, cannot be predicted with certainty by anyone.


tecate said:


> There are many Zimbabwe's  - at any given time, there's a list of Zimbabwe's. When considering bitcoin, that includes all the zimbabwe's in the world also. You don't get to leave them out.


Well I do from my narrow personal perspective.  I foresee no circumstance where I will be exposed to a Zimbabwe like syndrome.


tecate said:


> No Duke....you can't answer the question - because you don't know. At what point do they print/issue/magic up too many euro? It's a very reasonable and important question. That its complex to answer is fair but not to know is dangerous as far as I can see.


I can't answer the question in the sense that I can't give you a figure, I know you would like me to.  I can give you the conditions.  They will stop "printing" when in their expert view it is no longer conducive to their targets.  As explained, if they decide that it would be better to reverse the "printing" they have the tools to do that.  (forget the metaphor, tecate, they do not have to go sucking notes out of people's pockets.



tecate said:


> That's both nonsense and a cop out.  Bitcoin is an entirely different monetary system in its own right - by design. By 'real world', you mean this keynesian system we inherited? You've identified that Mugabe printed/issued too much currency. Why is it unreasonable of me to ask what's too much when it comes to other currencies?  Your outlook/view here is completely faith based - faith.....the stuff of religions and cults.  Is this the reason that they have 'In God We Trust' on the US dollar? Should I be saying a few 'our fathers'? Maybe divine intervention will provide me with an answer to my question.


No comment


tecate said:


> 12 months you say? And yet around 6 months ago you claimed that bitcoin hadn't appreciated anywhere near as good as gold.


You're wrong on that.  I pointed out that bitcoin had well outpaced gold.  That scenario is even more pronounced now.


tecate said:


> There is another theory by the way - and that's that bitcoin is beginning to be seen to have certain qualities that are superior to gold.


What are those "other facets" by the way?


tecate said:


> Wasn't 'Core CPI' used as the general reported measure of inflation for many years - introduced during a period of high inflation? It didn't include food, housing or energy.
> I asked you the other day if the currently used measure - as generally reported - includes housing, health insurance and education?
> What 'increased wealth effect'?


There are many definitions of CPI in many jurisdictions, all for different but valid purposes in their own right and not a tool kit for the elite to hoodwink the hoi polloi.
I am based in Ireland, possibly you are not.  I showed the constituents of Irish CPI.  It includes housing, insurance and education and of course food and energy.  I leave you to cherry pick the definition of CPI that suits the cult's narrative.


----------



## tecate

Duke of Marmalade said:


> My point is that if you physically print money ala Zimbabwe, Lebanon, Venezuela, there is no way back.  If you buy up long bonds by injecting money you can reverse that by selling back the long bonds you bought.  Japan has been operating QE on and off for many yonks now, and no sign of it going badly wrong.


Right - so it's all in the hands of the humans that run governments and central banks. They screw up, your savings are toast, etc.  I accept that some economies are more professionally managed than others but it still boils down to human judgement. I recall the former US president meddling with the Fed and putting political pressure on them re. interest rates. There are all sorts of stakeholders who may not have the best interests of citizens as their first motivation.



Duke of Marmalade said:


> Trusting and hoping.  Human behaviour, which is the real focus of monetary policy, cannot be predicted with certainty by anyone.


See above.



Duke of Marmalade said:


> You're wrong on that.  I pointed out that bitcoin had well outpaced gold.  That scenario is even more pronounced now.


No. In August you claimed that gold was comparatively a much better performer than bitcoin. 


Duke of Marmalade said:


> What are those "other facets" by the way?


You know them well after three years of this Duke. It can be used as a base settlement layer - gold cannot. It's divisible - gold isnt. It is decentralised ( whereas gold is largely held within a centralised system and manipulated accordingly). It's censorship resistant - allowing value to be transmitted digitally anywhere in the world by anyone that wants to send/receive it. It's perfectly finite - whereas gold isn't. If the price of gold rises, the level of extraction increases with that. 



Duke of Marmalade said:


> There are many definitions of CPI in many jurisdictions, all for different but valid purposes in their own right and not a tool kit for the elite to hoodwink the hoi polloi.


So was it wrong that Core CPI was introduced in the middle of a highly inflationary period - and continued to be used up until more recent times?



Duke of Marmalade said:


> I am based in Ireland, possibly you are not.  I showed the constituents of Irish CPI.  It includes housing, insurance and education and of course food and energy.  I leave you to cherry pick the definition of CPI that suits the cult's narrative.


Again, for the purposes of how this all affects bitcoin, then other jurisdictions count. 


Duke of Marmalade said:


> Well I do from my narrow personal perspective.  I foresee no circumstance where I will be exposed to a Zimbabwe like syndrome.


You are dependent upon 'In God We Trust' on that one. I favour the 'Don't Trust, Verify' approach.


----------



## Duke of Marmalade

@tecate you got me on the gold comparison there.  The thread is getting very long.  Maybe @Dublinbay12 is right, time to give it a rest.


----------



## joe sod

tecate said:


> Once again, my understanding is that technology is driving a deflationary environment but that doesn't mean that every category/item is immune from inflation eg. there may well be considerable asset price inflation.


This is a very interesting discussion now and I know has sidetracked to the wider topic of the link between deflation and technology. Has technology now reached the limits of its deflationary effects and is now inflationary. Technology has increased the demand for materials and commodities now especially rare ones needed for the manufacture of technology goods. At the same time the world is actually running short of "virgin materials" , the corona actually caused people to shift their spending from holidays and experiences like pubs and restaurants to goods and stuff. World shipping tonnage has increased significantly over the last year which explained why the blockage of the suez canal was so serious. 
Calls into question the whole narrative that technology is good for the environment, it is anything but, people are consuming more stuff than ever before and that stuff can no longer be produced cheaply.


----------



## tecate

joe sod said:


> This is a very interesting discussion now and I know has sidetracked to the wider topic of the link between deflation and technology. Has technology now reached the limits of its deflationary effects and is now inflationary. Technology has increased the demand for materials and commodities now especially rare ones needed for the manufacture of technology goods. At the same time the world is actually running short of "virgin materials" , the corona actually caused people to shift their spending from holidays and experiences like pubs and restaurants to goods and stuff. World shipping tonnage has increased significantly over the last year which explained why the blockage of the suez canal was so serious.
> Calls into question the whole narrative that technology is good for the environment, it is anything but, people are consuming more stuff than ever before and that stuff can no longer be produced cheaply.


I'm glad you bought this up, Joe. So....many folks are critical of bitcoin when thinking of it as a monetary system as they say that we have to have growth. If we don't have growth, then economically, we're dead. That's based on the current keynesian model. The upshot of that is that we encourage people to be up to their eyeballs in debt and to be the ultimate consumers - buying all manner of plastic crap from China. Most of it, they don't need. Bitcoin gets dragged over the coals for boiling the oceans when its this current economic model that's doing that.

Economic activity wouldn't have to fall apart under a bitcoin model. At the end of the day, people buy into innovation and things that they need. So economic life will go on. The difference is that they won't be induced to be rampant consumers as they are now. As responsible savers, they wont have their savings robbed through ongoing inflation either. That's another aspect of central bank digital currencies - they can manipulate the populace much more using CBDCs - and they'll manipulate them into spending more to get their damned growth rates so that the carnival keeps going. At the moment responsible savers get punished whilst those in debt are rewarded.

My understanding is that technology is advancing exponentially - and with that, its going to drive deflationary forces further. AI is finally coming into its own and that's going to have major implications. From what I've been led to believe, they won't be able to win that war against deflation in the long run.

(Just in case anyone is wondering why I've concerns about inflation given what I've stated above, both can play out - we can have a bad bout of inflation first if they get things wrong).


----------



## Duke of Marmalade

@tecate you will have noticed a plea from @Dublinbay12 to engage on her liquidity point.  I tried but no response.  Clearly it is engagement with yourself that she pines for.


----------



## DublinHead54

Duke of Marmalade said:


> I did make a belated attempt to address your liquidity point.
> I don't think you are using the usual definition of liquidity but correct me if I am wrong.
> Your definition:  will there be enough bitcoin to serve the twin demands of balance sheet and medium of exchange?
> Conventional definition:  how much* can be offloaded at current prices without affecting the price?
> The answer to both is all in the price and the reality (some will say the beauty) with bitcoin is that it can be any price that its users make it.
> Now when it cost 10,000 btc to buy 2 pizzas, even if the whole 21m were in circulation their combined value would just about buy a middle range car.  And I guess the guy who sold the 2 pizzas, if he tried to cash them in immediately would find he got maybe half the dollar value that he thought he was selling them for.
> Or maybe you are focussed on the quantity of bitcoin.  21m does not sound like a lot but that is 2,100 trillion satoshis if viewed from the smallest unit.
> _* The expression "how much?" implies a numeraire, which is usually the operating currency of the person asking the quastion._



I'm sorry, I missed your earlier response? The only person who engaged was Dazed in Pontoon who has since not responded. What was your earlier point?

You've gotten mistaken, I was not defining liquidity...I was making a point raised by the research by glassnode. 1 bitcoin is 1 bitcoin, the USD price is irrelevant in the context of liquidity. I believe BTC is a store of value which means as it is held as a reserve and adoption increases there is less circulating. This dynamic may drive up the $ value, but I don't think it will work the same as the gold market.

I am figuring this is why the pro bitcoin posters are not responding. This is a genuine issue the network will need to overcome for long term growth as a store of value. It has been repeated by tecate many times that we are just starting to see adoption happening

What is very concerning is that the research indicating 4m liquid btcs means that only 55 companies could purchase the same amount of BTC as MicroStrategy. This is far from mass adoption.


----------



## Duke of Marmalade

Dublinbay12 said:


> I'm sorry, I missed your earlier response? The only person who engaged was Dazed in Pontoon who has since not responded. What was your earlier point?
> 
> You've gotten mistaken, I was not defining liquidity...I was making a point raised by the research by glassnode. 1 bitcoin is 1 bitcoin, the USD price is irrelevant in the context of liquidity. I believe BTC is a store of value which means as it is held as a reserve and adoption increases there is less circulating. This dynamic may drive up the $ value, but I don't think it will work the same as the gold market.
> 
> I am figuring this is why the pro bitcoin posters are not responding. This is a genuine issue the network will need to overcome for long term growth as a store of value. It has been repeated by tecate many times that we are just starting to see adoption happening
> 
> What is very concerning is that the research indicating 4m liquid btcs means that only 55 companies could purchase the same amount of BTC as MicroStrategy. This is far from mass adoption.


I know you are waiting for @tecate's response but meanwhile I have dived further into your query as you obviously rate it seriously.  I read all the Glassnode stuff including their interesting logistic approach for smoothing the transition between the various liquidity classifications.
I also read @DazedInPontoon's reply to your OP.  I agree 100% with DiP, which is rare since I suspect he is tr*lling me.  Basically there is no issue, any slack will be taken up by the price.  There is absolutely no constraint on the price of bitcoin, it is totally determined by supply and demand.  A decrease in liquidity as you describe it is simply a fall in supply.  This is quite unlike something like gold which has to bear some relationship to its intrinsic value or even its historic value.  Bitcoin isn't anywhere near that - it is not held hostage to any intrinsic value or historic value, people don't give two hoots that a short time ago it cost 5,000 btc for a pizza.
I refer to the following follow up response you gave to DiP.


			
				DublinBay12 said:
			
		

> Can you explain what you mean here? A bitcoin is a bitcoin, the equivalent dollar value doesn't impact the liquidity of the asset. If there were 8m Bitcoin in circulation vs 4 million then by a matter of fact the 8m had more liquidity.


You are defining the liquidity of bitcoin in terms of the quantity of coins being transacted.  Clearly this will decline if the effective supply declines.  But what does that matter?  What matters is the liquidity in the numeraire of the person transacting, which is invariably their operating currency.  Muskie was able to put $1.5bn on his balance sheet without any noticeable shift in price at the time of the transaction (clearly it impacted the price subsequently but that is not a liquidity point).  This would have been impossible when there were 8m in circulation but the price was a fraction of what it is today.


----------



## tecate

Coinbase reported Q1 revenue of $1.8 billion yesterday. The company is due to get listed within 10 days - with a valuation of $100 billion.


----------



## tecate

..


----------



## DublinHead54

They are making a lot of money from a system that is meant to bring about financial inclusion.

Unfortunately due to the backwards US markets, only the wealthy can participate in the IPO.


----------



## tecate

Just to put Coinbase's direct listing in context, that will see it achieve a market capitalisation greater than that of Goldman Sachs. That's how far this market has come.


----------



## Sunny

tecate said:


> Just to put Coinbase's direct listing in context, that will see it achieve a market capitalisation greater than that of Goldman Sachs. That's how far this market has come.



Yeah, that's a positive alright. Everyone pile in to an IPO of a company that has announced that it has made more money in Q1 this year then it did all last year.....And to think they warn against the volatility of trading revenues for investment banks....


----------



## WolfeTone

Sunny said:


> Everyone pile in to an IPO of a company that has announced that it has made more money in Q1 this year then it did all last year.....And to think they warn against the volatility of trading revenues for investment banks....



That's the insanity of these stock markets, for sure. 
They like to peddle a myth that they are driven on sound economic and monetary principles, but in reality we all know it is the biggest Ponzi scheme of all.


----------



## DublinHead54

Given that GS produced 10x Revenues than that of Coinbase in the last Quarter it would suggest that either Coinbase is way over valued or GS is undervalued based on the metric Tecate chose to promote. 

Nonetheless coinbase has done exceptionally well and those in at the bottom stand to make a substantial life-changing amount of money. I actually interviewed last year with Coinbase in Ireland, this IPO showing it would have been a risk worth taking.


----------



## tecate

Sunny said:


> Yeah, that's a positive alright.



You're the first person I've heard to suggest that this isn't a milestone event. The bitcoin project was started 12 years ago with no seed capital, no investors, no marketing dept, no offices - just lines of code. Today it's got a trillion dollar market cap. Coinbase growing to this sort of size is equally impressive. I say that even though personally I don't much like the company or their offering.




			
				Sunny said:
			
		

> Everyone pile in to an IPO of a company..


You might want to work on the facts part of your salty comments. Firstly, it's not an IPO - its a direct listing. Secondly, I never suggested that anyone 'pile in' to said direct listing. I wasn't posting that info on that basis. I was acknowledging a landmark event in the industry.



			
				Sunny said:
			
		

> ...that has announced that it has made more money in Q1 this year then it did all last year


Really, Sherlock? This surprises you given the way the cryptocurrency market has developed in this particular market cycle? Quite the relevation.



			
				Sunny said:
			
		

> And to think they warn against the volatility of trading revenues for investment banks....


Yeah, clearly what suits you better is a nice respectable investment bank like Credit Suisse, right? I mean there's nothing wrong with them partnering with a convicted fraudster leading to a margin call mess that has cost it billions. Not one mention of it here but you can be sure if it was crypto-related, we'd be opening up dedicated threads for it.


----------



## Sunny

tecate said:


> You're the first person I've heard to suggest that this isn't a milestone event. The bitcoin project was started 12 years ago with no seed capital, no investors, no marketing dept, no offices - just lines of code. Today it's got a trillion dollar market cap. Coinbase growing to this sort of size is equally impressive. I say that even though personally I don't much like the company or their offering.
> 
> 
> 
> You might want to work on the facts part of your salty comments. Firstly, it's not an IPO - its a direct listing. Secondly, I never suggested that anyone 'pile in' to said direct listing. I wasn't posting that info on that basis. I was acknowledging a landmark event in the industry.
> 
> 
> Really, Sherlock? This surprises you given the way the cryptocurrency market has developed in this particular market cycle? Quite the relevation.
> 
> Yeah, clearly what suits you better is a nice respectable investment bank like Credit Suisse, right? I mean there's nothing wrong with them partnering with a convicted fraudster leading to a margin call mess that has cost it billions. Not one mention of it here but you can be sure if it was crypto-related, we'd be opening up dedicated threads for it.



Relax. Sorry if I personally insulted you by daring to comment on the craziness of a company with Q1 earnings equal to their last year earnings and people comparing them to Goldman Sachs. I should remember that anyone that disagrees with you is basically insulting your mother. At least that is what it seems like looking at your posts.....


----------



## tecate

@Sunny - Disagree on what? I offered up this information as recognition of a milestone in the industry. I acknowledged the scale of that growth via the market cap comparison with Goldman Sachs. That's where it ends. I made no suggestion as to whether anyone should invest in Coinbase.
Lastly, I don't feel in any way insulted  by your post or point of view. However, if you're going to have an issue with my responses, I'd suggest you have a look at the sarcastic twist you've put on that post starting with the opening sentence. Next maybe you should read the posts of others a couple more times before responding because i wasn't offering any recommendation as regards the suitability or otherwise of Coinbase as an investment.


----------



## Sunny

tecate said:


> @Sunny - Disagree on what? I offered up this information as recognition of a milestone in the industry. I acknowledged the scale of that growth via the market cap comparison with Goldman Sachs. That's where it ends. I made no suggestion as to whether anyone should invest in Coinbase.
> Lastly, I don't feel in any way insulted  by your post or point of view. However, if you're going to have an issue with my responses, I'd suggest you have a look at the sarcastic twist you've put on that post starting with the opening sentence. Next maybe you should read the posts of others a couple more times before responding because i wasn't offering any recommendation as regards the suitability or otherwise of Coinbase as an investment.



I never said you did recommend it. Did I? My sarcastic comment as you put it was in your response to your completely over the top comparison between Coinbase and Goldman Sachs. Why even pick Goldman Sachs? They are not even remotely similar companies. So Coinbase might have a market cap similar to Goldman Sachs? So what?? It could still be as worthless as plenty of other companies with absurd valuations before going public. It is a completely irrelevant comparison unless you somehow believe you can compare the two? 

You are just coming across like a cult member taking personal offence at anyone who dares question anything around the crypto market. Nobody who holds an opposite opinion to you is insulting you, they are not calling into question your reputation, your intelligence, your beliefs, your religion. They just disagree with you. I am allowed to say that any company who announces Q1 earnings greater than then the whole of the previous year is operating in a crazy market without being referred to as 'Sherlock'. At the end this, you could be a billionaire and the rest of us will still be here on AAM asking where we do exchange our old fashioned worthless notes and coins so relax....

Your many valid points on this topic are just going to get lost because you have actually replied to every single post on AAM that has dared question anything about the Crypto market...We know your view on this by now.


----------



## tecate

Sunny said:


> I never said you did recommend it. Did I?


Really? Then why respond to my post as if you did - with the 'everyone pile into this IPO' comment?



Sunny said:


> My sarcastic comment as you put it


As_ I_ put it? There's no question - it's there for everyone to see - you don't get to throw your toys out of the pram re. my response and not take responsibility for the sarcastic nature of your own post.



Sunny said:


> to your completely over the top comparison between Coinbase and Goldman Sachs. Why even pick Goldman Sachs? They are not even remotely similar companies. So Coinbase might have a market cap similar to Goldman Sachs? So what?? It could still be as worthless as plenty of other companies with absurd valuations before going public. It is a completely irrelevant comparison unless you somehow believe you can compare the two?


Explain to me how its inappropriate?  Once again, I have to point out to you that I wasn't offering up Coinbase as a suggested investment. The comparison was made to give an indication of how Coinbase has grown substantially as a company. Nothing more and nothing less. You want to contrive to suggest otherwise - but the comparison never went beyond that.



Sunny said:


> You are just coming across like a cult member


Firstly, I don't give a fiddlers about your wayward interpretation. But wayward it is. I can cite a whole host of critique I've made on bitcoin and crypto. If I asked you to do the same thing re positive commentary, you'd come up with nothing. So who's the real cultist?



Sunny said:


> taking personal offence at anyone who dares question anything around the crypto market.


You were corrected on that but you persist. I haven't taken 'personal offence' at any such thing - but keep going with that if it suits your narrative.



Sunny said:


> Nobody who holds an opposite opinion to you is insulting you, they are not calling into question your reputation, your intelligence, your beliefs, your religion. They just disagree with you.


Provide a link where I've ever suggested that you have insulted me personally? Opinions are a given on a discussion board...as is disagreement. None of this is news.



Sunny said:


> I am allowed to say that any company who announces Q1 earnings greater than then the whole of the previous year is operating in a crazy market without being referred to as 'Sherlock'.


Hang on a second - you don't get to put a sarcastic edge on things (and claim disagreement when you went on a solo run on something completely different) and then throw your toys out of the pram afterwards.



Sunny said:


> Your many valid points on this topic are just going to get lost because you have actually replied to every single post on AAM that has dared question anything about the Crypto market...We know your view on this by now.


I have the nerve to hold a differing opinion so I should be quietened?  I get where you're coming from entirely. If you post on a public discussion board, you can very much guarantee that said post will be open to critique. That's something that for the most part should be welcomed. For the most part, I welcome it - albeit in your case I didn't much take to the sarcastic undertones and measured my response accordingly.


----------



## Duke of Marmalade

@tecate why are you not engaging with @Dublinbay12 on his liquidity point?  He seems to know his cryptonions.  Has he got you on a sore point?

I was thinking about the remarkable surge in price since Muskie made his disclosure.  And I was thinking what would happen to the price if Muskie or even Saylor announced they had got out  as they thought it was over priced.  The price would surely collapse.  Is any other asset class so dependent on the goodwill a couple of egotists?


----------



## tecate

Duke of Marmalade said:


> @tecate why are you not engaging with @Dublinbay12 on his liquidity point?  He seems to know his cryptonions.  Has he got you on a sore point?


I have been told off by @Sunny for daring to question things...so I better be  more selective in my postings going forward Duke.   
I'll leave that discussion to yourself and @DazedInPontoon .




Duke of Marmalade said:


> I was thinking about the remarkable surge in price since Muskie made his disclosure.  And I was thinking what would happen to the price if Muskie or even Saylor announced they had got out  as they thought it was over priced.  The price would surely collapse.  Is any other asset class so dependent on the goodwill a couple of egotists?



I'm sure that there would be a certain drop for sure. You have to bear in mind that this is still a market that is a number of years away from maturity. Within it, there are all manner of stakeholders. At the end of the day, people have to determine in their own minds if there's something tangible in this or not. I'm sure the very same people that got in (and would get out) on the basis of Musk or Saylor's actions would be the same that would respond similarly to the various types of FUD that does the rounds eg. Bitcoin is boiling the oceans, the bitcoin market is being manipulated and Tether will be its undoing, etc.


----------



## Duke of Marmalade

tecate said:


> I'll leave that discussion to yourself and @DazedInPontoon .


Hmmm!  I would have thought the liquidity point was a bull indicator as was suggested by @Dublinbay12's  link and also confirmed by myself and @DazedInPontoon.  I would have thought you would warm to it, but I sense you see a vulnerability,


----------



## tecate

Duke of Marmalade said:


> I would have thought you would warm to it, but I sense you see a vulnerability,


With a couple of exceptions I agree with your post on the subject so like you i fail to see any vulnerability in this instance.


----------



## DublinHead54

tecate said:


> I have been told off by @Sunny for daring to question things...so I better be  more selective in my postings going forward Duke.
> I'll leave that discussion to yourself and @DazedInPontoon .



This is a good summary of Tecates approach, the sources I used are the same sources he often posts from so he couldn't claim 'FUD'. There was no sarcasm or anything else controversial that he/she could use to turn the conversation away from the topic at hand like the interchanged with Sunny over the last few posts.

So instead of discussing a topic that should be at the top of the list for a finite cryptocurrency that is seeing more and more institutional adoption, they chose to ignore it.

Ironically the IPO of Coinbase is only going to further increase the uptake of BTC making the liquidity issue an even more prevalent question. Coinbase holds roughly 1m BTC.

I will assume any response (if there is one) to this post will try and further take away from the topic of liquidity and probably focus on how they are not required to engage when they don't want to etc etc


----------



## WolfeTone

Dublinbay12 said:


> they chose to ignore it.



Who are 'they'? 

I understand your point, but I don't necessarily agree. I do not think it is the number one issue, or anywhere close to it. 
If I'm part of 'they' I choose not to engage for that reason.


----------



## RedOnion

Dublinbay12 said:


> I will assume any response (if there is one) to this post will try and further take away from the topic of liquidity


Coinbase isn't an IPO. It's a direct listing.

Just to get that distraction out of the way.


----------



## Brendan Burgess

RedOnion said:


> Coinbase isn't an IPO. It's a direct listing.
> 
> Just to get that distraction out of the way.



Stop trying to take the thread off topic with facts!


----------



## DublinHead54

RedOnion said:


> Coinbase isn't an IPO. It's a direct listing.
> 
> Just to get that distraction out of the way.



Yes, I used the wrong terminology, should have just said going public. Coinbase was a side conversation. I have been trying to engage on the liquidity of bitcoin as adoption as a store of value (buy and hold) by corporates / institutions. 

I maintain that it is a good debate to have and is certainly a less treaded topic in this thread.


----------



## DublinHead54

WolfeTone said:


> Who are 'they'?
> 
> I understand your point, but I don't necessarily agree. I do not think it is the number one issue, or anywhere close to it.
> If I'm part of 'they' I choose not to engage for that reason.



What did you disagree with? I haven't really stated any opinion on liquidity. Liquidity is a market dynamic and I have posted research that raises a point on potential liquidity issues at the current rate of adoption vs mining rate with BTC being used as a store of value / treasury asset. 

I wanted to engage with a discussion, not just to be told you disagree with the research. I mentioned that I was trying to understand if this could develop into a real issue or what the solution is. I was hoping that either you or @tecate  could provide some further insight rather than just disagreeing. 

I am not trying to disprove BTC or anything, I am simply trying to discuss the liquidity issue with others that understand BTC and may be closer to the market than I am. 

Can you help?


----------



## WolfeTone

Dublinbay12 said:


> Is there enough BTC for every Balance sheet to have bitcoin on it?



Yes. As has been mentioned there will be 21 trillion satoshis in existence. 
With 4.2m bitcoin circulating, that is currently 4.2 trillion satoshis. 
More than enough for every Balance sheet and individual to hold some bitcoin on their balance sheet. 

There will of course be an issue with trying to obtain the desired amount of bitcoin. I set out in my own way to obtain one full bitcoin. Alas, I am not even close to that. But because I have funds available, a smart phone and the Internet, I can add more to my holding as I see fit and that I can afford.


----------



## Sunny

RedOnion said:


> Coinbase isn't an IPO. It's a direct listing.
> 
> Just to get that distraction out of the way.



To be fair the distinction between Direct Listing and IPO isn't really that important. All a direct listing does is reduce the need for underwriters and means new stock is not created. It creates liquidity for existing shareholders and will allow the founders and employees make a lot of money. The logic of coinbase doing it while bitcoin is in this hyperbolic bubble as the title of the thread suggests is clear to see. At the end of the day, it doesn't matter if new investors are going to buy new stock or existing stock. What matters is the price they are going to buy the stock at and without underwriters, the price range and the volatility will be interesting to see. And the valuations of coinbase are simply ridiculous. 

Coinbase could be the greatest idea of all time but I can guarantee you thing. The days of exchanges like Coinbase operating under a different regulatory regime to other exchanges will end. They are currently regulated as a Money Services Business and yet are carrying out trading activities and indeed take positions to 'provide liquidity' in their exchange. No other exchange in regulated financial services is allowed to do this. You get an argument that exchanges like coinbase are becoming increasingly relevant to mainstream financial services. Well then, they should be ready to play by the same rules as other exchanges. To be fair to Coinbase, I do believe they have listed regulatory changes as one of the risks of the direct listing.


----------



## WolfeTone

Dublinbay12 said:


> So instead of discussing a topic that should be at the top of the list for a finite cryptocurrency that is seeing more and more institutional adoption, they chose to ignore it.





Dublinbay12 said:


> What did you disagree with?



The above comment. I don't it should be top of the list for discussion.


----------



## RedOnion

Sunny said:


> To be fair the distinction between Direct Listing and IPO isn't really that important.


Oh I know, but the technicality will be used as a distraction if it's not addressed.


----------



## DazedInPontoon

I feel like I'm probably just repeating what myself and Duke have already said in recent posts, but here's goes anyway.

People involved generally care about liquidity as defined by (number of coins) x (price per coin). This has generally being going up, I expect bitcoin exchanges have never been as liquid in terms of dollar value as they are now.

When Tesla and MicroStrategy were buying they weren't approaching it as "I want to buy x number of coins" it was "I want to buy x dollars worth of bitcoin" - for Tesla this was 1.5b for MS it was basically all of their treasury dollars.

If the number of bitcoin on exchanges continues to dwindle, but the demand for bitcoin (measured in dollars) does not decrease, then the price of bitcoin will rise.

Additionally a rising price will bring more coins to exchanges, as bitcoin reaches prices high enough that some long term holders feel happy to sell some/all of their coins at. If BTC hits 100k, 200k, 500k, I'd surely be diversifying a bit.

I don't see any liquidity issues, except perhaps for those who are short bitcoin.


----------



## DublinHead54

DazedInPontoon said:


> I feel like I'm probably just repeating what myself and Duke have already said in recent posts, but here's goes anyway.
> 
> People involved generally care about liquidity as defined by (number of coins) x (price per coin). This has generally being going up, I expect bitcoin exchanges have never been as liquid in terms of dollar value as they are now.
> 
> When Tesla and MicroStrategy were buying they weren't approaching it as "I want to buy x number of coins" it was "I want to buy x dollars worth of bitcoin" - for Tesla this was 1.5b for MS it was basically all of their treasury dollars.
> 
> If the number of bitcoin on exchanges continues to dwindle, but the demand for bitcoin (measured in dollars) does not decrease, then the price of bitcoin will rise.
> 
> I don't see any liquidity issues, except perhaps for those who are short bitcoin.



Isn't this fundamentally the opposite of what BTC is aiming to do? i.e. Replace the current fiat system?

I am thinking of liquidity in terms of whole BTC rather than the $ equivalent, but I see your point in terms of liqudity from a $ perspective. The challenge I have is that Brokers track their liquidity in amount of coins held in BTC terms in their cold wallets, not the $ value. 

However, given there are only 8m coins available at a market cap of roughly ~500m or so the entire supply could be easily purchased by a handful of companies today.


----------



## DublinHead54

WolfeTone said:


> There will of course be an issue with trying to obtain the desired amount of bitcoin.


This is the definition of a liquidity issue.

Do you have any thoughts on a solution?


----------



## DublinHead54

Sunny said:


> To be fair the distinction between Direct Listing and IPO isn't really that important. All a direct listing does is reduce the need for underwriters and means new stock is not created. It creates liquidity for existing shareholders and will allow the founders and employees make a lot of money. The logic of coinbase doing it while bitcoin is in this hyperbolic bubble as the title of the thread suggests is clear to see. At the end of the day, it doesn't matter if new investors are going to buy new stock or existing stock. What matters is the price they are going to buy the stock at and without underwriters, the price range and the volatility will be interesting to see. And the valuations of coinbase are simply ridiculous.
> 
> Coinbase could be the greatest idea of all time but I can guarantee you thing. The days of exchanges like Coinbase operating under a different regulatory regime to other exchanges will end. They are currently regulated as a Money Services Business and yet are carrying out trading activities and indeed take positions to 'provide liquidity' in their exchange. No other exchange in regulated financial services is allowed to do this. You get an argument that exchanges like coinbase are becoming increasingly relevant to mainstream financial services. Well then, they should be ready to play by the same rules as other exchanges. To be fair to Coinbase, I do believe they have listed regulatory changes as one of the risks of the direct listing.



Sunny, one thing to note as well....Coinbase is not the darling of the Crypto world, most experienced users do not use them because of the fees involved. I agree with your points, and if anything this is just a brokerage that will suffer from price competition like any other. 

It is a much better comparison to compare coinbase to Robinhood rather than Goldman sachs. At the end of the day its priced because of its revenue not because of what it is selling.


----------



## WolfeTone

Dublinbay12 said:


> Do you have any thoughts on a solution?



Yes, do what I do, buy what can be afforded. 
I may not ever obtain my desired target - 1BTC, but I am a long way from not being able to obtain additional bitcoin. Liquidity is not an issue.


----------



## tecate

WolfeTone said:


> Who are 'they'?


Oh, dear. Wolfie - I'm sorry to have to break this news to you but you've been pidgeon-holed as part of a group of partisan crypto scoundrels. Had you made better choices in life, you could have been part of a 'neutral' group that can see  both the positive and negative attributes of bitcoin (posting those attributes in equal measures, at a ratio of 0:100). 

@Duke of Marmalade : I feel that you have a lot of explaining to do and must insist on your participation in this discussion. Didn't you tell us not so long ago that bitcoin wasn't in any way scarce as it was practically infinitely divisible?
I must say I'm troubled by the thought of there not being enough bitcoin to go round. More troubling still is that I checked Nouriels twitter feed and not a mention of it. Surely, he - if anybody - would have comprehensive detail on this looming crypto crisis?

Maybe I've misunderstood though - is the take here that people are going to demand bitcoin to the point of it melting? I feel a bit light headed - I'm off for an ice bath.
Do come back with your comments as I'd really like to see someone post a solution to this problem. As a show of solidarity, I'm making a commitment right now that I will not hoard my btc and will make it available in its smallest denomination (0.00000001 BTC) to anyone who is in need. That makes for a usd value of $0.00059 - and yet neither rounding up or down is going to help with that. I suppose as this crisis reaches melting point, we can be thankful that can get resolved at the very least.


----------



## DazedInPontoon

Dublinbay12 said:


> Isn't this fundamentally the opposite of what BTC is aiming to do? i.e. Replace the current fiat system?


BTC doesn't really have a concrete aim, it just *is* and people can use it as they desire, and people's opinions differ on what it should aim to be. Personally I don't think bitcoin needs to replace anything, it can just exist alongside. In practice I think it *is* probably replacing precious metals use as money, and sucking some allocations out of other stores of value too. If Bitcoin didn't exist I would have the money I have in bitcoin in something else, for me that's probably equities.


Dublinbay12 said:


> However, given there are only 8m coins available at a market cap of roughly ~500m or so the entire supply could be easily purchased by a handful of companies today.


You mean 500b surely. But anyway, all of the supply could not easily be purchased, because the price would raise proportionally to the demand.


----------



## DublinHead54

WolfeTone said:


> The above comment. I don't it should be top of the list for discussion.





WolfeTone said:


> There will of course be an issue with trying to obtain the desired amount of bitcoin.





WolfeTone said:


> Liquidity is not an issue.



There will be an issue obtaining the desired about of bitcoin, but liquidity is not an issue? That is the very definition of liquidity, can you not see that?

I get your point on your own personal ambitions, but I was asking on the basis of Institutional adoption, and this is what Tecate has been providing updates on over the last year that adoption rates are increasing. Even considering your own approach if there is mass retail adoption that will further impact liquidity.

The issue I see is that by design bitcoin is scarce and the first use case was as a currency. In use as a currency the market will be liquid as coins are continually circulated and can be divided into satoshis. However, over the last 24 months as adoption as a store of value has increased (Micro strategy holding as a Treasury Assets) there has been a decrease in the coins circulating on the market.

The argument being made by @DazedInPontoon is that firms should price BTC in terms of $ so if they want to convert $100m to BTC that could be 10 BTC today and 5 BTC tomorrow, the amount of BTC being irrelevant and just the $ amount. I see the logic but not really the use case given BTC is a volatile asset and that argument only seems to hold true with a high BTC price. For example if BTC were to fall back to Jan 2020 levels, the $100m would have much more purchasing power against the same amount of BTC on the market.

So a high $$ BTC price limits the amount of BTC an individual can buy but given that corporate/Bank Cash reserves > total circulating BTC $ value, the entire supply could be purchased tomorrow. For example Goldman Sachs alone has $400bln dollars in reserves vs $500bln BTC circulating supply.

*In this event, I am not sure how the market would function because the number of transactions on the network would surely drop and if there are no transaction fees being generated what is the economic incentive for the nodes to stay operational?*

I hope this question in bold can be answered by either @tecate @WolfeTone @DazedInPontoon or anybody else? I am trying to understand this market dynamic and I thought this was a forum for discussion and learning! I believe Tecate has made a point of saying he wants to help educate people before. It's fine if you don't have an answer but anything would be of help. I have accumulated a significant holding in BTC and I am trying to understand this dynamic as I formulate my strategy.


----------



## WolfeTone

Dublinbay12 said:


> In this event, I am not sure how the market would function because the number of transactions on the network would surely drop and if there are no transaction fees being generated what is the economic incentive for the nodes to stay operational?



Well my tuppence worth is this. There is 12.5 new coins mined every 10 mins? In order for any institution to buy up existing supply, and new supply, it would send price even higher. 
My thinking is that as the price gets higher and higher, some of those that bought in low will be continually tempted to sell. Along with newly mined coins, trying to dominate the supply in this manner, at higher and higher prices would simply be unsustainable. 
At some point a large sell-off would be invoked ensuring continuing supply. 

I do not envisage a liquidity issue at all. Even if so, it would be temporary.


----------



## DazedInPontoon

WolfeTone said:


> There is 12.5 new coins mined every 10 mins?


It's down to 6.25 since the last halving, and currently about another 0.6 BTC in fees per block, which I guess can be considered added liquidity.


Dublinbay12 said:


> So a high $$ BTC price limits the amount of BTC an individual can buy but given that corporate/Bank Cash reserves > total circulating BTC $ value, the entire supply could be purchased tomorrow. For example Goldman Sachs alone has $400bln dollars in reserves vs $500bln BTC circulating supply.


No, they'd move the market too much by trying to buy $400b worth. Their first bitcoin would cost the current market price of 58k, but who knows what stratopshere the price would have gone to by the time they were buying the last coin.

This is where liquidity is a consideration - "Can I buy x amount of dollars worth of BTC without moving the price too much". On a podcast recently I heard Raoul Pal say that many institutions who deal in large amounts basically wouldn't really consider bitcoin liquid enough to invest in to until it was at the $1T market cap.


Dublinbay12 said:


> The argument being made by @DazedInPontoon is that firms should...


Just to be clear, it wasn't an argument, and I wasn't saying firms should do anything. I was describing what is actually happening.


Dublinbay12 said:


> *In this event, I am not sure how the market would function because the number of transactions on the network would surely drop and if there are no transaction fees being generated what is the economic incentive for the nodes to stay operational?*


I mean, you can come up with any number of hypothetical situations that result in btc failing. The easiest mistake to make is to say "what if this changes..." about one aspect of bitcoin without understanding how that one change would change other things and/or how other things change over time. If you go back a few years to when the reward was 50btc or even 25btc per block there was endless people predicting that bitcoin would now by dead with a reward of only 6.25btc per block because there would insufficient incentive for miners to mine.

Bitcoin is very far from having a problem of not having enough transactions, the problem if any is that it can't support the demand for transactions!

Additionally if demand is driving the price to the moon, there is no need for transaction fees at all for decades as even a block reward of 1 btc or less would be incentive enough for miners.

We're getting into the "what if the restaurant had food so good that it got so busy that no one went there any more?" territory


----------



## DazedInPontoon

I additionally want to say that my earlier statement of liquidity being considered as (coin on exchange) x (price per coin) is a simplification. In reality not all coins on exchanges are offered for sale at the market price, and in fact most are not. Some may not even be involved in a sale order at all, and those that are may be for sale at any price higher than the market price.

If you look at https://bitcoinity.org/markets/coinbase/USD for example, you can see the 'depth chart' at the bottom, if you mouse over any point in it on the red line it will tell you exactly how many are for sale at that point and how much cumulative USD it takes to move the price that far.


----------



## tecate

Sunny said:


> Coinbase could be the greatest idea of all time but I can guarantee you thing. The days of exchanges like Coinbase operating under a different regulatory regime to other exchanges will end. They are currently regulated as a Money Services Business and yet are carrying out trading activities and indeed take positions to 'provide liquidity' in their exchange. No other exchange in regulated financial services is allowed to do this. You get an argument that exchanges like coinbase are becoming increasingly relevant to mainstream financial services. Well then, they should be ready to play by the same rules as other exchanges.


What different rules? This market was wide open to Wall Street to enter. They chose not to (until right now). Not only did they choose not to, they crapped all over this developing sector from a height - screaming fraud ( a la Jamie Dimon & others).  They tried to snuff the fledgling industry out entirely by locking crypto startups out of banking (something that's still not fully resolved).
At the end of 2020, bitcoin's market cap was $519 billion. And yet, since 2008, banks had paid $330 billion in fines related to fraud, market manipulation and money laundering. These wonderful conventional market regulations where these guys pay cents on the dollar and continue on facilitating money laundering at the highest levels.
I'm no fan of Coinbase but there's no question but that they've played by the regulation that's in place. If you've got a problem with regulation getting up to speed, then who's fault is that?



Sunny said:


> You get an argument that exchanges like coinbase are becoming increasingly relevant to mainstream financial services.


What argument? That's what we're seeing play out in real time - it's not a matter of argument or speculation.


On a side note, I want to clear up a misquote where someone or other suggested that I had said in the past that I wanted '_to help educate people_'. I'd never make such an obnoxious statement. What I have said is that people should have uncensored access to both sides of the debate so that they're free to form their own opinions - nothing more than that.


----------



## DublinHead54

WolfeTone said:


> Well my tuppence worth is this. There is 12.5 new coins mined every 10 mins? In order for any institution to buy up existing supply, and new supply, it would send price even higher.
> My thinking is that as the price gets higher and higher, some of those that bought in low will be continually tempted to sell. Along with newly mined coins, trying to dominate the supply in this manner, at higher and higher prices would simply be unsustainable.
> At some point a large sell-off would be invoked ensuring continuing supply.
> 
> I do not envisage a liquidity issue at all. Even if so, it would be temporary.





DazedInPontoon said:


> It's down to 6.25 since the last halving, and currently about another 0.6 BTC in fees per block, which I guess can be considered added liquidity.
> 
> No, they'd move the market too much by trying to buy $400b worth. Their first bitcoin would cost the current market price of 58k, but who knows what stratopshere the price would have gone to by the time they were buying the last coin.
> 
> This is where liquidity is a consideration - "Can I buy x amount of dollars worth of BTC without moving the price too much". On a podcast recently I heard Raoul Pal say that many institutions who deal in large amounts basically wouldn't really consider bitcoin liquid enough to invest in to until it was at the $1T market cap.
> 
> Just to be clear, it wasn't an argument, and I wasn't saying firms should do anything. I was describing what is actually happening.
> 
> I mean, you can come up with any number of hypothetical situations that result in btc failing. The easiest mistake to make is to say "what if this changes..." about one aspect of bitcoin without understanding how that one change would change other things and/or how other things change over time. If you go back a few years to when the reward was 50btc or even 25btc per block there was endless people predicting that bitcoin would now by dead with a reward of only 6.25btc per block because there would insufficient incentive for miners to mine.
> 
> Bitcoin is very far from having a problem of not having enough transactions, the problem if any is that it can't support the demand for transactions!
> 
> Additionally if demand is driving the price to the moon, there is no need for transaction fees at all for decades as even a block reward of 1 btc or less would be incentive enough for miners.
> 
> We're getting into the "what if the restaurant had food so good that it got so busy that no one went there any more?" territory



Thank you both for the responses. 

Do you have any links to the recent price increase and demand relationship? I have been researching but always found it inconclusive or it pointing towards more factors than just supply and demand raising the price.


----------



## DublinHead54

@tecate Is there any substance to Musks recent tweets on BTCs energy consumption from coal? 

I saw Michael Saylor refute it but without evidence. From previous discussion on this forum you presented evidence and argument against BTC using mostly renewables now? 

Musks claims have spooked the market!


----------



## presidenttttt

Duke of Marmalade said:


> This is a renowned economist talking.  Are there any respected economists making the case for bitcoin?  Ironically the amazing bitcoin performance of 2020, from 10k to 4k to 30k(?) spells its early demise.  A nice steady performance would have been more indicative that bitcoin had come of age and was here to stay.  2017 was a similarly ridiculous year and it was followed by the collapse from 20k to 3k in 2018.


I can’t disagree with the OP.

Latest events of random “coins” spiking and single individuals manipulating the whole market only confirm my view.

These “coins” are no more a currency than premier league stickers for a sticker book or Pokemon cards some people collected as kids. And I suspect will prove about as useful unless in time. You can pay up to a 100,000 for a pokemon card by the way!

Bitcoin threads read like apartment in Bulgaria threads from 2005!

When it comes to mortgage applications I am surprised banks don’t take the same view of crypto as they do of paddy power transactions. The volatility and social media led pumps that are going on att the moment are absolute high risk madness. The “investment” is totally incomparable to equities or currency. When all the hype is done there will be a tiny minority who get mega wealthy and most people will get their fingers burnt.

Blockchain or something similar will provide a real mainstream currency with genuine value in time, but it will in my opinion originate via Washington, the Kremlin, or China, which will ironic as many people jumping on the hype train think it’s a means to protest and overthrow the “current system and institutions”. An Amazon or Google initiative might be the only thing to shift my thinking (Tesla is a huge brand but doesn’t touch billions of people daily, so it’s just more Twitter noise).


----------



## WolfeTone

presidenttttt said:


> Bitcoin threads read like apartment in Bulgaria threads from 2005!



This reads like a post from 2017.


----------



## Brendan Burgess

Wolfie

The Bulgaria threads went on for a few years.

The dot.com ones did as well.

Brendan


----------



## WolfeTone

True, I just making the comparison.


----------



## tecate

presidenttttt said:


> Latest events of random “coins” spiking and single individuals manipulating the whole market only confirm my view.


Each project is to be considered on its own merits. There will be category winners covering a whole host of use cases. Otherwise, the vast majority of projects will cease to exist. If we have to go through cycles of irrational over-exuberance to get there, so be it. Personally, I think that the emergence of 'meme coins' is truly moronic. However, if that's what people want to participate in, then that's totally up to them. 



presidenttttt said:


> Bitcoin threads read like apartment in Bulgaria threads from 2005!


I can't say that apartments in Bulgaria ever interested me. In what respect are they similar? What utterance here has contrived to lead you astray?




presidenttttt said:


> When it comes to mortgage applications I am surprised banks don’t take the same view of crypto as they do of paddy power transactions.


In Ireland, they do. Up until recently, they played god by facilitating paddy power transactions via credit card whilst banning crypto transactions. More recently HSBC Bank has taken to banning customers from holding stock of companies that hold bitcoin. I wouldn't expect anything less from a bank with such high standards. Meanwhile, in the US, banks are gearing up to offer bitcoin to their customers. Payments firms like visa, mastercard and paypal are adapting to the change that's coming and that they know is inevitable.



presidenttttt said:


> The volatility and social media led pumps that are going on att the moment are absolute high risk madness.


If you're referencing bitcoin here, then its volatility has been discussed at length on this sub-forum previously. There's a logic to it. It's going through a process of price discovery and that will continue for some years to come.



presidenttttt said:


> The “investment” is totally incomparable to equities or currency.


Bitcoin isn't an equity - I agree.



presidenttttt said:


> When all the hype is done there will be a tiny minority who get mega wealthy and most people will get their fingers burnt.


There are hype cycles and some get irrational, over-exuberant and downright greedy. I expect an 80% reset - but the difference is that where others here have called time on bitcoin (as they did in the last cycle), I expect its development to continue. During the last bear market, the talk was of it never seeing $20,000 again and of the poor 'suckers' that got caught in that process. I expect we will have a re-hash of the very same discussion on here. The only difference is that the $20,000 figure will be long forgotten about. And on it goes..
As regards people getting their fingers burnt, everyone remains accountable for their own decisions - and it shouldn't be any other way. I have neither bought nor sold crypto over the course of the past 12 months.



presidenttttt said:


> Blockchain or something similar will provide a real mainstream currency with genuine value in time, but it will in my opinion originate via Washington, the Kremlin, or China, which will ironic as many people jumping on the hype train think it’s a means to protest and overthrow the “current system and institutions”. An Amazon or Google initiative might be the only thing to shift my thinking (Tesla is a huge brand but doesn’t touch billions of people daily, so it’s just more Twitter noise).



You seem to be vaguely talking about central bank digital currencies. Can you explain how they will provide 'genuine value' and to whom? You also seem to be reducing this down to a choice - that it has to go one way or the other. There can be a certain feverishness in markets but that doesn't then mean that there is nothing tangible in the innovation at hand. Decentralised cryptocurrencies will continue in their development and use cases extend far beyond that of currency.




			
				presidentttt said:
			
		

> These “coins” are no more a currency than premier league stickers for a sticker book or Pokemon cards some people collected as kids. And I suspect will prove about as useful unless in time. You can pay up to a 100,000 for a pokemon card by the way!


The discussion centres around bitcoin for the most part. Having said that, there is a huge market that is being exploited along the lines of the collectibles that you mention on other platforms - taking a digital approach to that via non-fungible tokens or NFTs. Not something that remotely interests me personally but I accept that people will pay more for the bragging rights of holding an original of something.


----------



## tecate

Brendan Burgess said:


> The dot.com ones did as well.


You've often referenced the dot.com boom/bust Brendan, and I think it's entirely relevant to consider it. However, it shouldnt be forgotten that that particular wave of innovation changed everything. Out of the ashes came the Google's, Facebook's, Amazon's, etc. The expectation here is that most crypto projects will vapourise with category winners left standing.


----------



## DazedInPontoon

The tech industry as a whole has recovered since the dot-com bubble. Even specific companies within that are worth way more today - Microsoft and Amazon for example. The big tech companies are massive and are extremely profitable. What's the lesson here regarding the dot-com bubble?

Does this tell us anything except that a bubble and crash can be a temporary blip along the path of a longer term growth narrative, or a bubble can be a once off that never recovers (Bulgarian property presumably? - I've no idea what state it is in today). And even within the first case where the longer term growth leads to a full recovery and higher long term trajectory certain companies/assets will fail and never recover. pets.com in the dot-com, Anglo in the Irish property bubble.

Bubbles in a sector in general may or may not recover.
Companies or assets involved in a bubble may or may not recover regardless of whether the sector does.

Since all of the above can happen there's nothing here I can use to predict the future except accept that things that gain momentum tend to get in a mania phase and get overpriced in the short term and eventually correct fairly sharply. In order to act correctly there is no substitute for understanding the specific market itself, because just recognising mania is not enough.

I do think the internet age is exaggerating this too. Joe Bloggs having a portable low commison trading platform in his pocket is a massive change to markets. I expect we're going to see bigger bubbles than ever.


----------



## WolfeTone

DazedInPontoon said:


> (Bulgarian property presumably? - I've no idea what state it is in today)



Bulgaria House Price Index


----------



## DazedInPontoon

Not so bad I guess! I assume a lot of people were just outright scammed for property that never existed though, or by property companies that were vehicles for scams or went bust.


----------



## presidenttttt

tecate said:


> You've often referenced the dot.com boom/bust Brendan, and I think it's entirely relevant to consider it. However, it shouldnt be forgotten that that particular wave of innovation changed everything. Out of the ashes came the Google's, Facebook's, Amazon's, etc. The expectation here is that most crypto projects will vapourise with category winners left standing.


I can agree with this for the most part. I just would not bank on the category winner having entered the competition yet and i think there is some way to go.


----------



## presidenttttt

DazedInPontoon said:


> I do think the internet age is exaggerating this too. Joe Bloggs having a portable low commission trading platform in his pocket is a massive change to markets. I expect we're going to see bigger bubbles than ever.


This is true. Another point about the social media platforms though is the algorithms work hard to give you the content you want, and if you are in the network that follows #tothemoon and one or two of the more active influencers in the trading/crypto space, you could feel that crypto is far more mainstream, accepted and trusted than it actually is. 

If I look at my professional and educated 25-35 year old peer group, a few of us might have a few 100 euros "invested" (due to lock down boredom more than anything, at least in my case) but it is rarely spoken about, whereas there is a bit of an echo chamber effect on social media where you might think everyone had 1000s in it.  The viral and hype nature to some of these things of course has also been witnessed in non crypto channels (Gamestop).


----------



## tecate

presidenttttt said:


> I just would not bank on the category winner having entered the competition yet and i think there is some way to go.


That's fair enough. However, bear in mind that I was referring to categories - plural. That said, from what I can decipher - you're focusing on crypto's which can or will be used as currency. People have different notions as to what success looks like in this regard. Right now, bitcoin is formative as a decentralised store of value rather than a day to day currency. It also is making some in-roads in terms of use as a settlement layer - for settlement of large amounts internationally.  As a day to day currency it doesn't scale - although it may still make in-roads via layer 2 solutions.

I think you referred to the coming of central bank digital currencies and to private digital currencies. There's no doubt but that these are coming - it's just a matter of how long it takes. Facebook failed miserably with their offering and on the back of that, I think a lot of people have forgotten about them - they're still working away on their digital currency. So there should be some level of choice (albeit that CDBC's - being just an extension of sovereign money - are not something anyone chooses - rather something that we are forced to use). Anyone in their right mind (regardless of what they think of the development of crypto) should welcome choice in an area there never has been choice before.  However, bear in mind that these are very different things. Whilst they offer individuals choice, they belong in their own categories. I guess what I'm saying is that if CBDCs or private digital money are issued, I don't see these as a threat to bitcoin. Quite the opposite as they will serve a purpose in conditioning people in becoming more comfortable with digital currency.

Bitcoin belonging in its own category of decentralised cryptocurrency as opposed to private digital or fiat digital is going to be hard to overcome at this point. Many roll out the myspace analogy yet myspace had attained a fraction of the market cap that bitcoin has - as a trillion dollar asset. It was also overtaken as facebook hit the ground running in catering to mobile whereas myspace didn't do so. Many also think that bitcoin was/is the first crypto - but that's also not the case. I'm quite open to it being surpassed but whatever comes next will have to be 10x better. Having the upperhand on one single characteristic isn't going to cut it.


----------



## tecate

presidenttttt said:


> If I look at my professional and educated 25-35 year old peer group, a few of us might have a few 100 euros "invested" (due to lock down boredom more than anything, at least in my case) but it is rarely spoken about, whereas there is a bit of an echo chamber effect on social media where you might think everyone had 1000s in it.  The viral and hype nature to some of these things of course has also been witnessed in non crypto channels (Gamestop).


I am of the view that we are still at an incredibly early stage in all of this. This particular bull market started off fairly sober but has given way to a feverishness surrounding nft's, the defi casino and meme coins. NFTs are not my bag but I would say that this development is reeling in a raft of new people who otherwise had no interest in crypto. DeFi is incredibly high risk - and I suspect a lot of fingers are going to get very badly burnt with it. That said, the innovation that ultimately arises from it will likely be much bigger than what bitcoin brings. Meme coins I find completely moronic - but if grown adults choose to involve themselves with that, that's there own doing. I don't think anyone should suggest that anyone has been ripped off in this respect later on...rather people need to take responsibility for their own decisions.
A lot of that stuff I'm not all that enthusiastic about - but between those items and each hype cycle, more people are reeled in to crypto. You may be quite right in your thinking that people are getting ahead of themselves but by dabbling in crypto - they're introducing themselves to it. They may come due to boredom or curiosity but oftentimes, people start to understand what's tangible and what's bs.

This bull market isn't done yet - and it will be followed by a bear market and another such cycle. What's most important - is that as per previous cycles - bitcoin's network effect will continue to grow.


----------



## Duke of Marmalade

My money is on Bitcoin winning the Ransomware category, if it isn’t closed down.  More likely it will be the only category.


----------



## jim

Duke of Marmalade said:


> My money is on Bitcoin winning the Ransomware category, if it isn’t closed down


My money is on you loosing your money


----------



## WolfeTone

My view on the Musk (partial) turnaround on bitcoin. 

Tesla spent $1.5bn(?) on bitcoin. It occurs to me that if you are going to spend that much on anything you are going to some bit of research on what you are buying. 
The bitcoin energy red-flag has been raised for a long enough so it is beyond my comprehension how a company like Tesla could not have been aware of the energy usage issue surrounding bitcoin. 
If they were aware of it before, and did some research about it before they bought bitcoin then it obviously wasn't that big an issue to deter purchase of bitcoin. So it would be hard to understand why it is an issue a few months later. 

Another possibility is that Musk has jumped on the bitcoin bandwagon and Telsa is a company that is run by "Yes-Elon" men and women, which would be a bigger concern for me if I had shares in Tesla. 

The third possibility, and I think most probable, is that Tesla probably has a significant number of green-energy investors who, not being overly endeared to bitcoin or understanding of it, are putting a bit of a squeeze on Tesla and the direction it has taken with bitcoin, resulting in Musks announcement to stop accrpting bitcoin as a means of payment.


----------



## tecate

Duke of Marmalade said:


> My money is on Bitcoin winning the Ransomware category, if it isn’t closed down.  More likely it will be the only category.


Research has shown that of the 300,000 transactions / $10 billion that the bitcoin network settles each day, illicit use only accounts for 1%. I know you'd like to tar and feather it in that way but it's not going to wash.


----------



## Duke of Marmalade

tecate said:


> Research has shown that of the 300,000 transactions / $10 billion that the bitcoin network settles each day, illicit use only accounts for 1%. I know you'd like to tar and feather it in that way but it's not going to wash.


Huge skill that, how researchers can get criminals to openly disclose their money laundering activities.


----------



## WolfeTone

Duke of Marmalade said:


> Huge skill that, how researchers can get criminals to openly disclose their money laundering activities



Roubini being a leading researcher 

"_Cryptocurrencies are routinely launched and traded outside the domain of official financial oversight, where avoidance of compliance costs is advertised as a source of efficiency. The result is that crypto land has become an unregulated casino, where unchecked criminality runs riot."_


----------



## Duke of Marmalade

WolfeTone said:


> Roubini being a leading researcher
> 
> "_Cryptocurrencies are routinely launched and traded outside the domain of official financial oversight, where avoidance of compliance costs is advertised as a source of efficiency. The result is that crypto land has become an unregulated casino, where unchecked criminality runs riot."_


Another one of your nice tries _Wolfie_.  All off that quote is observable fact except the conclusion which does involve an element of speculation.  Much as I respect Prof Roubini's skills this speculation cannot compare with the researchers cited by @tecate who were able to identify that c. 3,000 of daily bitcoin transactions are illigit.  My understanding of how crypto works is that this could only be gleaned by getting criminals to openly admit their crimes.


----------



## WolfeTone

Duke of Marmalade said:


> except the conclusion which does involve an element of speculation



Which is the only pertinent part of the quote when referencing criminality that is related to cryptocurrency.



Duke of Marmalade said:


> Much as I respect Prof Roubini's skills this speculation cannot compare with the researchers cited



On the contrary, the researchers cited by @tecate are positively claiming that criminality is not running riot to any great extent.

It is Roubini who makes the counter claim. Unless he is getting criminals to openly admit their crimes then there is more than a whiff of speculation in his 'research'.


----------



## tecate

Duke of Marmalade said:


> Huge skill that, how researchers can get criminals to openly disclose their money laundering activities.


Pretty lazy stuff from you Duke. The research comes from Chainalysis who are disliked by plenty in the crypto space and if anything I would have thought it would be better for their business model if their findings were more in line with what you very much want them to be.

And that figure again just in case you missed it...$10 billon settled on the Bitcoin network every day.


----------



## tecate

Duke of Marmalade said:


> Much as I respect Prof Roubini's skills this speculation cannot compare with the researchers cited by @tecate who were able to identify that c. 3,000 of daily bitcoin transactions are illigit.  My understanding of how crypto works is that this could only be gleaned by getting criminals to openly admit their crimes.


You mean Roubini's complete loss of objectivity on the subject such that he will latch on to anything that's negative about bitcoin regardless of it having even a trace of credibility. 

3,000 tx out of 300,000 daily bitcoin transactions, yes.

I guess your understanding doesn't extend to on-chain analysis - which is precisely what Chainalysis does.


----------



## joe sod

WolfeTone said:


> The bitcoin energy red-flag has been raised for a long enough so it is beyond my comprehension how a company like Tesla could not have been aware of the energy usage issue surrounding bitcoin.
> If they were aware of it before, and did some research about it before they bought bitcoin then it obviously wasn't that big an issue to deter purchase of bitcoin. So it would be hard to understand why it is an issue a few months later.


All he had to do was read my posts earlier addressing this issue. Maybe Musk is afraid that attention will be drawn to the fact that alot of the electricity used to power Tesla cars also come from coal and fossil fuels. On a cold calm day virtually all the electricity produced comes from fossil fuels. Battery technology to store enormous quantities of electricity does not exist and is never likely to either. The head of Eirgrid admitted this recently saying  their battery storage can only produce at maximum output for less than an hour so never a replacement for a conventional power station. Now if only we could retrieve all that energy stored in bitcoin for cold calm days


----------



## tecate

joe sod said:


> Maybe Musk is afraid that attention will be drawn to the fact that alot of the electricity used to power Tesla cars also come from coal and fossil fuels. On a cold calm day virtually all the electricity produced comes from fossil fuels.


Ok, I see where you're going with this.  So essentially you're encouraging Elon to acknowledge that there are a whole host of other things using a bucket load of energy; that his EVs only really become transformative when we greenify the energy supply as a whole. That's precisely where this 'bitcoin boils the oceans' narrative lacks honesty. It's the entire energy grid that needs to go green - not people coming out and dictating who can/can not use energy based on their own bias, ignorance or both.

As for Elon's reasons, not having the info at hand beforehand can't possibly be one of them. Having to backtrack due to people buying into this cherry picked narrative is one.  There has been mention of carbon offset business being significant for Tesla so it could be that. Lastly it could be a case of 4D chess and they're going to enter the bitcoin mining market - which they can do with the kit that they have installed in consumers homes all over North America.




joe sod said:


> Battery technology to store enormous quantities of electricity does not exist and is never likely to either.


Now this is very interesting. So demand can only be as predictable as the weather and renewables can only be as predictable as the weather and there's no way to deal with the peaks and troughs (the duck curve).
.


joe sod said:


> Now if only we could retrieve all that energy stored in bitcoin for cold calm days


Time for you to ask a better quality of question, Joe. What could be established to utilise the excess energy at source when it comes to irratic renewable energy production? We could have central government continue to subsidise renewable energy projects OR could something else benefit from that excess energy whilst making such a project financially viable?


----------



## Duke of Marmalade

tecate said:


> And that figure again just in case you missed it...$10 billon settled on the Bitcoin network every day.


Of which only 1% is for criminal purposes, which is at least a genuine utility.  How much can be spent on lattes?  It leaves an awful lot of money in daily speculation on this price discovery journey.  In fact does Chainanalytics tell us how much is spent on utility transactions?  Criminal activity would probably amount to about 50% of that.


----------



## Cavanbhoy

Duke of Marmalade said:


> Huge skill that, how researchers can get criminals to openly disclose their money laundering activities.


I don't get the dislike of Bitcoin, do people commit fraud with it yes but is that not the same with Fiat.
Is Bitcoin in a bubble or overpriced maybe but that is more down to people than bitcoin itself.
Is it fear off change thats driving the debate over bitcoin there seems to be two camps one thinking its brilliant and going to change the world and the other its a scam with nothing in between.
Personally I dont know which but then I thought selling bottled water and takeaway coffees would never take off.


----------



## joe sod

tecate said:


> As for Elon's reasons, not having the info at hand beforehand can't possibly be one of them. Having to backtrack due to people buying into this cherry picked narrative is one. There has been mention of carbon offset business being significant for Tesla so it could be that.


Yes exactly that could be it, we know that the whole green lobby and ESG investing has become a huge thing and alot of Tesla profits come from selling carbon credits, another arbitrary accounting token . There is alot of cherry picking of narratives going on in the green area now especially as it has becoming a huge political and now financial issue. Oil and Gas companies have to pay Tesla for carbon credits even though those cars cannot run without that energy in many cases. 
Another narrative is that going green is easy if only the big bad oil companies would get out of the way and let it happen and that the oil companies need to be punished, the good guys bad guys narrative so beloved of hollywood. 
I know I jokingly referenced retrieving all the energy used to produce a bitcoin, so alot of energy is used to solve complex maths equations which at the end produces a bitcoin. What if we reverse the process unsolve the equations reabsorb the bitcoin and release the energy, however that is impossible because of the laws of physics and thermodynamics. There is a hierarchy of energy that you can only move in one direction, once you burn oil to produce heat you cannot retrieve that heat to create oil again.


----------



## Duke of Marmalade

joe sod said:


> ...to solve complex maths equations which at the end produces a bitcoin.


I am quoting you out of context here and what follows is not a criticism of your post.
But it really sticks in the craw this metaphor of "mining" and "solving complex math", the former creating a gold illusion and the  latter sounding very sophisticated and even productive.  All part of the cult mythology.
This is the correct metaphor.  I have locked a €50 note in a box and closed it with a combination key.  The box is left out in the open for the first person who can guess the combination.  And they can have as many tries as they can fit in until someone opens the box.  Note there is no intellectual content in these tries, they are pure random quickpicks.
Two takeaways from the metaphor.  1.  The locking of the box was totally unnecessary.  2.  There is absolutely no sophistication whatsoever in the race to open it.
@Cavanbhoy Of course I do not actually hate the inanimate object that is crypto.  But, like the illustrious Professor Roubini and various Nobels and numerous academics, I do find the cult that engulfs it intellectually distasteful in the same way as I feel about theories that the World was built in 7 days 6,000 years ago.  I am less offended by the unbridled speculation or the eco bit - after all I enjoy a bet and I drive a diesel car.


----------



## tecate

Duke of Marmalade said:


> Of which only 1% is for criminal purposes, which is at least a genuine utility.  How much can be spent on lattes?  It leaves an awful lot of money in daily speculation on this price discovery journey.  In fact does Chainanalytics tell us how much is spent on utility transactions?  Criminal activity would probably amount to about 50% of that.


You can try and label use of bitcoin as right or wrong all day long Dukey - the fact remains that when this debate opened on AAM, there wasn't anywhere near $10 billion in daily settlement on the Bitcoin network. Its network effect is growing and whilst I don't take anything for granted I suspect that it will continue to grow. Otherwise, the sands are shifting beneath your perennial reliance on the notion that it's all just speculation. Billionaire investor and entrepreneur Mark Cuban pointed to that change earlier this week:


__ https://twitter.com/i/web/status/1393584361375735810


Cavanbhoy said:


> I don't get the dislike of Bitcoin


It varies  - there can be pragmatic objections. However, in these parts I suspect its political. The constant reference to 'cultists' is the giveaway. Bitcoin is the first financial instrument that wasn't conceived by Wall Street or their ilk. It sticks in the craw of many that cypherpunks drove this and even though it's being embraced by all manner of stakeholders now, there are many that won't accept it.
The resistance to change aspect that you hit on is the other reason. Millennials downwards are going to be far more comfortable with the use of virtual currencies than their elders (not to mention their ability to understand it better). Others are quite happy with the current order of things and are simply uncomfortable with any moves to change it up. Dukey's suggestion during the course of these discussions that we simply have to have blind faith in central bank high priests even though the financial system is broken underscores that point.


joe sod said:


> I know I jokingly referenced retrieving all the energy used to produce a bitcoin, so alot of energy is used to solve complex maths equations which at the end produces a bitcoin. What if we reverse the process unsolve the equations reabsorb the bitcoin and release the energy, however that is impossible because of the laws of physics and thermodynamics. There is a hierarchy of energy that you can only move in one direction, once you burn oil to produce heat you cannot retrieve that heat to create oil again.


I think maybe the point I was trying to make above was lost on you. So rather than fight against the laws of physics/thermodynamics, why not embrace bitcoin mining and harness it for the betterment of all? Here's an example. Lets say you are the proposer of a renewable energy project. You run the numbers and its not feasible (due to the irregular nature of the energy capture/production). You lobby central government to subsidise the project but they don't have the $ to do so. You decide to partner with a bitcoin mining co. to utilise at source the excess energy that is being produced at times. This is your subsidy - and now when you run the numbers, the project is viable.


Duke of Marmalade said:


> It really sticks in the craw this metaphor of "mining" and "solving complex math", the former creating a gold illusion and the  latter sounding very sophisticated and even productive.  All part of the cult mythology.This is the correct metaphor.  I have locked a €50 note in a box and closed it with a combination key.  The box is left out in the open for the first person who can guess the combination.  And they can have as many tries as they can fit in until someone opens the box.  Note there is no intellectual content in these tries, they are pure random quickpicks.


I see. So what's important to you Duke is not that the bitcoin mining algorithm should provide the most robust network security on the planet but that it should only dare to do so in a manner you deem to be 'intellectual'.  Sit with that notion for a while - hopefully you will see how obnoxious a view it is. If you can't, then I'm lost for words.



Duke of Marmalade said:


> The locking of the box was totally unnecessary.


Your metaphor is wayward. You're suggesting that there's no need for network security. That's the whole point of the algorithm.



Duke of Marmalade said:


> 2.  There is absolutely no sophistication whatsoever in the race to open it.



Again, see above. It seems its not important to you that it provides the best in class network security because it doesn't reach your levels of 'sophistication'. Is that really what we're talking about here?


----------



## joe sod

tecate said:


> I think maybe the point I was trying to make above was lost on you. So rather than fight against the laws of physics/thermodynamics, why not embrace bitcoin mining and harness it for the betterment of all? Here's an example. Lets say you are the proposer of a renewable energy project. You run the numbers and its not feasible (due to the irregular nature of the energy capture/production). You lobby central government to subsidise the project but they don't have the $ to do so. You decide to partner with a bitcoin mining co. to utilise at source the excess energy that is being produced at times. This is your subsidy - and now when you run the numbers, the project is viable.


No I understand perfectly well your point, that the Tesla shareholders and the green lobby are cherry picking narratives to suit their viewpoints and that now bitcoin falls outside of that due to the energy consumption . However I don't subscribe to your view that excess energy created from renewables from time to time should be used to produce bitcoins. I think trying to come up with a technology to store energy on the scale of what power stations produce continuously is enormously difficult and maybe impossible, I think your suggestion that excess renewable energy should be used for bitcoin is a sideshow. The central effort should be concentrated on energy storage not on bitcoin. 
I dont want to get into this argument again by the way I was focussing on the hypocrisy of possibly Tesla shareholders and the green lobby


----------



## tecate

joe sod said:


> No I understand perfectly well your point, that the Tesla shareholders and the green lobby are cherry picking narratives to suit their viewpoints and that now bitcoin falls outside of that due to the energy consumption .


I wasn't necessarily speculating on Tesla shareholders specifically. When I refer to 'this cherry picked narrative ' , I'm referring to the singling out of bitcoin mining above and beyond all other energy uses. Musk knows that it can be used to facilitate green energy capture/production - but him knowing this isn't enough due to the ill-intended and lazy narrative that is being pushed and perpetuated.



joe sod said:


> However I don't subscribe to your view that excess energy created from renewables from time to time should be used to produce bitcoins.



So you acknowledged that battery technology doesn't cut the mustard right now and that it may never cut the mustard. On the back of that, you'd sooner have excess energy from renewable schemes remain untapped and have taxpayers money pay for that privilege. That speaks volumes.



joe sod said:


> I think your suggestion that excess renewable energy should be used for bitcoin is a sideshow.


I guess what you're saying is that you are vehemently opposed to bitcoin and that serves to cloud your judgement. You've been presented with a clear case where bitcoin mining can provide the subsidy to make so many currently unfeasible renewable projects viable and you'd rather pass up on that due to your overall objection to bitcoin generally.



joe sod said:


> I was focussing on the hypocrisy of possibly Tesla shareholders and the green lobby


I'd encourage you to have a look at a clear case of hypocracy much closer to home. We have people singling out bitcoin above and beyond all other users of energy on environmental concerns. Then when a clear case is set out in how bitcoin mining can be utilised positively for the further development of renewable energy, that's of no interest and it's 'a sideshow'.

When time and time again, we see people in this debate sooner see stranded or untapped renewable energy escape into the ether rather than be utilised via bitcoin mining (as the energy user of last resort), it's evident that their opposition to bitcoin generally is what grounds their view and not environmental concerns. That's before we consider the reduction in environmental damage that can be brought about in the longer run due to shrinking the environmental effects of the gold industry and conventional banking  as Mark Cuban alludes to ->


__ https://twitter.com/i/web/status/1392611938983632896


----------



## Duke of Marmalade

tecate said:


> I see. So what's important to you Duke is not that the bitcoin mining algorithm should provide the most robust network security on the planet but that it should only dare to do so in a manner you deem to be 'intellectual'.  Sit with that notion for a while - hopefully you will see how obnoxious a view it is. If you can't, then I'm lost for words.


@joe sod referred to "complex mathematical equations".  It is not a question of what turns me on.  I am referring to the seductive language associated with the horrible entrails of crypto.  My very first read up on bitcoin (only about 4 years ago) used this sort of language.  And my initial thoughts were that here was a technology that is actually creating something - solving complex mathematical equations, advancing human knowledge and somehow creating value in that way.  I knew terms like "mining" were mere metaphor but I thought (hoped) that here was something that actually created something of value using mathematics.  I was excited to learn more - hence I purchased Antonopolous.  What a disappointment I was in for, possibly explains my distaste for the whole cult.  But my main objection is that I think many millennial type folk are seduced by the imagery of "mining" and "solving complex mathematical equations".  It is all hype.


tecate said:


> Your metaphor is wayward. You're suggesting that there's no need for network security. That's the whole point of the algorithm.


I knew that was wrong when I said it.  But now I have the opportunity to make the correct statement.  Satoshi surely never envisaged that within 12 years there would be $10bn settlements per day.  It has surely reached a maturity point where the network security can be sustained by transaction fees as was the original ultimate destination.  This would greatly reduce the difficulty level, which has gone through the roof as a result of the enormous unanticipated profits to be got from "mining".


----------



## tecate

Duke of Marmalade said:


> I am referring to the seductive language associated with the horrible entrails of crypto.



Not just a Duke but the chief of policing for the use of metaphors and analogies?  The general public find bitcoin difficult to understand to begin with. You object to the use of a description that makes it much easier to understand?  There's nothing else I have to say on this Dukey except that in no way do I agree with you.



Duke of Marmalade said:


> I thought (hoped) that here was something that actually created something of value using mathematics.


It seems to me that you can't see the wood for the trees, Duke. At the end of the day, the purpose of the algorithm is to secure the network. The fact that it hasn't been breached in its 12 years of existence stands testament to the robustness of the network security that the algorithm provides for. That you're not satisfied with it securing a trillion dollar asset is an issue that you yourself have to come to terms with.



Duke of Marmalade said:


> possibly explains my distaste for the whole cult.  But my main objection is that I think many millennial type folk are seduced by the imagery of "mining" and "solving complex mathematical equations".  It is all hype.


See post # 620 for the reason you and others persist with the 'cult' references and your objection to a very intuitive and instructive manner of explaining away the bitcoin algorithm and bitcoin itself.




Duke of Marmalade said:


> I knew that was wrong when I said it.  But now I have the opportunity to make the correct statement.  There is no need for this game any more.  Satoshi surely never envisaged that within 12 years there would be $10bn settlements per day.  It has surely reached a maturity point where the network security can be sustained by transaction fees as was the original ultimate destination.


I don't think that there is anyone who would agree with you as regards bitcoin the asset or bitcoin the network having reached a point of maturity. However, $10 billion in settlements a day suggests that it is progressing and it's instructive that its network effect continues to grow and has grown over the course of these discussions.
Other than that, you've read the white paper so you know perfectly well that reliance on transaction fees rather than the issuance of new bitcoin has been scheduled from day one - and that progression will finalise in 2140. It's set out for all to see.


----------



## Duke of Marmalade

tecate said:


> Other than that, you've read the white paper so you know perfectly well that reliance on transaction fees rather than the issuance of new bitcoin has been scheduled from day one - and that progression will finalise in 2140. It's set out for all to see.


I have corrected my original post.  The "open the box by guessing the combination key"  will be the mode of securing the system even when there is nothing in the box for the combination key guessers.  But the huge incentive represented by the surely unanticipated value of new bitcoin locked in the box has caused the difficulty level to be 21 trillion times higher than originally required.  That's right folks,  the number of combination key guesses is 21 trillion times greater than the original difficulty level which was itself in the billions.


----------



## tecate

Duke of Marmalade said:


> I have corrected my original post.  The "open the box by guessing the combination key"  will be the mode of securing the system even when there is nothing in the box for the combination key guessers.  But the huge incentive represented by the surely unanticipated value of new bitcoin locked in the box has caused the difficulty level to be 21 trillion times higher than originally required.  That's right folks,  the number of combination key guesses is 21 trillion times greater than the original difficulty level which was itself in the billions.


So in summary, you've taken to ridiculing a network security model that has proven to work effectively over the course of 12 years whilst a litany of centralised financial networks have been compromised within that timeframe. That makes a lot of sense for sure.


----------



## Duke of Marmalade

tecate said:


> So in summary, you've taken to ridiculing a network security model that has proven to work effectively over the course of 12 years whilst a litany of centralised financial networks have been compromised within that timeframe. That makes a lot of sense for sure.


This particular rabbit hole arose from my highlighting the hype in the imagery surrounding bitcoin.  "Solving complex mathematical equations" sounds a lot sexier than "guess the combination key zillions of times".  It is not a monster point and I have never questioned the security of the platform.


----------



## tecate

Duke of Marmalade said:


> This particular rabbit hole arose from my highlighting the hype in the imagery surrounding bitcoin.  "Solving complex mathematical equations" sounds a lot sexier than "guess the combination key zillions of times".


This particular rabbit hole has arisen due to vehement opposition to the notion of decentralised cryptocurrency. You want to re-write the description to reflect your deep-seated prejudicial view with deep-seated prejudicial language.



Duke of Marmalade said:


> It is not a monster point and I have never questioned the security of the platform.


That's not correct. Time and time again you've ridiculed the bitcoin algorithm (and with that bitcoin's network security) - including on this occasion when you've repeatedly stated that its not sophisticated. This view is absurd when you're forced to concede that it is evidently plenty sophisticated when it competently secures a trillion dollar asset.


----------



## Duke of Marmalade

tecate said:


> You want to re-write the description to reflect your deep-seated prejudicial view with deep-seated prejudicial language.


Jayz, _tecate _chill out.  My language can be provocative I know, but we are only talking about crypto.  It almost seems that I am insulting your religion.  I would never insult anybody's religion, honestly.


----------



## tecate

Duke of Marmalade said:


> Jayz, _tecate _chill out.  My language can be provocative I know, but we are only talking about crypto.  It almost seems that I am insulting your religion.  I would never insult anybody's religion, honestly.


You can't come out with this nonsense Dukey and later say 'chill out' when you can't defend it. As regards religion, that's something that you would know a lot more than me about seeing as you belong to the "in God we trust" cult.


----------



## WolfeTone

Duke of Marmalade said:


> But it really sticks in the craw this metaphor of "mining" and "solving complex math", the former creating a gold illusion and the latter sounding very sophisticated and even productive. All part of the cult mythology.



This is silly Duke. 

The adoption of everyday terminology and words as metaphors for new products, processes, concepts etc is as old as the hills. Not least in the financial and tech industries. 

Everyone knows that when someone buys a Microsoft 'Windows' product that it is not actual physical world windows you get. Its the concept behind explaining the product. 

Similarly in the financial world. The terms 'liquid' 'solvent' 'currency' 'bubble' 'crash' 'overheating' are all terms adopted from their meaning of origin to explain abstract concepts and processes applicable to money and within the financial system. So good are these words at explaining the concept that they are now definitively financial terminology. 
Ditto 'mining' for the concept of 'unearthing' new bitcoin.


----------



## letitroll

Pretty clear now that post the Colonial Pipeline ransomware attack and now the HSE/Health Service one - both denominated in bitcoin…….the EU/USA and the rest of the G7 are in my opinion going to take a wrecking ball to this space in the next 12 months.

Crypto nonsense might get all the headlines - but its like at best 0.01% of GDP………when an activity thats 0.01% of GDP endangers 100% of GDP + lives………..I know what I’d do…..easy choice……crush it

If i was holding BTC - I’d be dumping……its gonna be a bloodbath


----------



## WolfeTone

letitroll said:


> when an activity thats 0.01% of GDP endangers 100% of GDP + lives………..I know what I’d do…..easy choice……crush it



How does it endanger 100% of GDP? And how is it to be crushed?


----------



## tecate

letitroll said:


> Pretty clear now that post the Colonial Pipeline ransomware attack and now the HSE/Health Service one - both denominated in bitcoin…….the EU/USA and the rest of the G7 are in my opinion going to take a wrecking ball to this space in the next 12 months.


So lets consider this logic... Somewhere in the world today someone or other is planning on committing a crime whilst using a car in the process. According to your logic, we should ban cars.
Secondly, you can't prevent people from using a decentralised cryptocurrency - you can only slow down its proliferation - nothing more.
Thirdly, ban crypto and all the innovation that goes with it will up sticks and take itself overseas overnight.




			
				leti troll said:
			
		

> Crypto nonsense might get all the headlines - but its like at best 0.01% of GDP………when an activity thats 0.01% of GDP endangers 100% of GDP + lives


Like Wolfie, I'm fascinated to hear how it threatens 100% of GDP but even more fascinated to hear how crypto threatens lives!



			
				leti troll said:
			
		

> ..I know what I’d do…..easy choice……crush it



I can see how much thought you've given this. Anything that's ever described as an easy choice usually has far reaching consequences.


----------



## Duke of Marmalade

@WolfeTone Another one of your heroic tries.  So do you think that it is fair to describe gazillions of trials at a combination lock as "solving complex mathematical equations" even with the licence of metaphor?
Here’s an example of one of those trials:
SHA256(Wolfe Tone)=9b061076849fe24e9a1b6cc514530e05e473d3f46a42232a9b28736c1cbbf4bb
After gazillions of these trials a lucky “miner” gets a hit (lots of leading zeros) opens the box and pockets $300k
No clever programming, nothing clever at all. But I presume you know all that.
Have a go yourself. SHA256 is downloadable by anyone. You don’t need any mathematical background whatsoever.


----------



## WolfeTone

Duke of Marmalade said:


> After gazillions of these trials a lucky “miner” gets a hit and pockets $300k



Well let's break down the terminology - Solving complex mathematical equations. 

Would it be reasonable to suggest that "solving mathematical equations" is ok with you? And that the offending piece is the word "complex"? 

complex
[ˈkɒmplɛks]

ADJECTIVE

1. consisting of many different and connected parts.
"a complex network of water channels"
synonyms:
compound · composite · compounded · multiplex 


I'm starting to think that you perhaps you are conflating the word "complex" with "complicated"? 

Clearly your descript of 21trillion key 'guesses' would suggest that the maths is complex. But your references to 'clever' and 'sophistication' infer an interpretation of 'complicated' as well.
 As the dictionary definition above demonstrates, it would be appropriate to describe the Amsterdam canal network as complex, but not very complicated to understand.

As I understand it, there are new bitcoins 'minted' (another metaphor for adoption by crytpo) every ten minutes. 
Awarded to the miners that verify all the transactions in a block.

Compare that to the euromillions. You can gain a jackpot reward in the millions, far in excess of any bitcoin reward, if you buy tickets with every single possible combination of numbers. 
It is not very complicated, but it is very complex as there are 139,000,000 different combinations. Surely beyond the capacity of any one individual or group of individuals to manaully achieve this?
Perhaps a simple computer program could be devised to purchase tickets for each combination of numbers?
But at €2.50(?) a line, the jackpot would have to be €347,500,000 just to break even. I think €200m is the highest is has ever got. Worse, if you spent €347,500,000 on euromillions tickets, I think only 50% of that goes to prize money. 
Even then, anyone attempting to win the jackpot this way would have to factor the double-spend problem (rather, one or more persons picking the same combination of numbers for the same draw).

It is fair to say that the Euromillions have established a robust, fool-proof system to ensure the integrity of the euromillions. It's not very complicated, but it is complex.

As for bitcoin, the maths are far more complex ensuring the integrity of the network.


----------



## letitroll

tecate said:


> So lets consider this logic... Somewhere in the world today someone or other is planning on committing a crime whilst using a car in the process. According to your logic, we should ban cars.





tecate said:


> I can see how much thought you've given this. Anything that's ever described as an easy choice usually has far reaching consequences.


I've clearly given it more thought than you @tecate . Your car example is a new one.....the standard cyrpto speaking point response you should have used.... is should we blame the internet, mobile phones, email, text messages..why not ban them all..........it misses the very nub of the argument and shows how little YOU have thought about it I'm afraid.

Let me explain - and I hope you understand it and if you disagree with me I would like to understand with reasoned argument where my logic has failed me.

The reason why bitcoin is different than the computer that was used for the ransomware attack, the car that drove the man who did the attack there, the internet connection over which the ransomware software was deployed is twofold:

(1) Bitcoin - is not an incremental improvement for society or a demonstrable improvement on what went before (blockchain the underpinning technology is possibly, I admire it but I have yet to see it solve any real world problems at scale yet.But i think it might). Bitcoin has not improved ANYONES lives that I know personally nobody not a single person (except for those gambling on it that have made money and are happy - so gamblers maybe?)...., I dont use it to pay for things, i send my friends money using revolut instantly and for free (you've seen coinbase fees right?)......we have a digital and analogue currency already, a high volume, low cost payments system with low energy consumption.

Bitcoin FAILS the incremental human society/technology improvement test (with the downside that its so useful for extortionists and kidnappers).  Cars, the internet, mobile phones, computers...............all PASS this test. No? Explain to me why? Bitcoin has higher fees than fiat, cant process transactions at the scale of visa/mastercard, is more volatile than currency/gold so is a poor store of predictable long term value for people. It FAILS the improved currency, payment mechanism AND store of value VERSUS what we have already. The argument that it somehow cant be diluted/devalued like fiat has been utterly destroyed by the literally 1000's of competing coins - Dogecoin for one.....that have been created to compete with it for the store of value/transaction function. Is this not fiat currency printing-esque in its nature?No? Explain how I'm wrong?

(2) Bitcoin itself is not just an adjunct tool in the carrying out of a crime (like your car example, mobile phone, computer, internet).......it is the object /the aim of the crime itself....the motivator.......the vehicle in which the reward from the proceeds of that crime is housed. Its attraction is that it provides a superior risk/reward dynamic embedded in it than cash/bank transfers do for the criminal. These crimes would be pointless if the perpetrators asked for cash or bank wire they would almost certainly get caught. Bitcoin provides the greater probability that they wont. If I'm wrong on this - why have the two largest ransomware crimes been denominated in it in the last two weeks? It therefore by extension an incentive for such crimes. Its existence all things being equal - INCREASES the frequency of these crimes.  If you add this to my point no. (1) failing the incremental improvement technology test while (2) making serious crime easier for the criminals while increasing the frequency of such crime. Why should society tolerate its existence? If the net benefit is negative?

That is my logic. Please take each point separately @tecate and explain how I'm wrong. Please also at this point declare conflicts of interest. The old phrase - who's bread I eat, his song I sing springs to mind. I own no bitcoin and I'm not short it. This is my opinion with no directional benefit on the rising or falling of bitcoins price. Do you @tecate hold or have held bitcoin? I suspect you do. Multi-level marketing schemes like bitcoin turn owners into promoters. I get a sense of you being a promoter in this instance but perhaps I'm wrong?

I reserve the possibility, always, that I'm a moron and you are a man that has seen the future and I stand ready to have my mind changed.


----------



## WolfeTone

letitroll said:


> Bitcoin has not improved ANYONES lives that I know personally nobody not a single person





letitroll said:


> (except for those gambling on it that have made money and are happy



So it has improved lives. Gamblers are people too!


----------



## letitroll

WolfeTone said:


> So it has improved lives. Gamblers are people too!



I was waiting for @tecate .............but glad to see you couldn't tackle any of my points on merit @WolfeTone.......but could only jokingly ridicule, a sign that perhaps my points have merit & stung somewhat?.....if this wasn't a joke and your point is that Bitcoin is an improved gambling sardine.....it also fails the incremental technology test benefiting human society that might, just might make increased kidnappings and extortions a reasonable trade off


----------



## tecate

letitroll said:


> I've clearly given it more thought than you @tecate .


Whilst I'm quite happy to adjust my view as things progress, somehow I doubt that.



letitroll said:


> Your car example is a new one.....the standard cyrpto speaking point response you should have used.... is should we blame the internet, mobile phones, email, text messages..why not ban them all..........it misses the very nub of the argument and shows how little YOU have thought about it I'm afraid.


The point is valid. I'm not in favour of kneejerk reactions - throwing the baby out with the bathwater. The same 'logic' was pushed about before the internet reached critical mass - the call back then was that it was the tool of pedo's and criminals and was of little use to society. Articles were published saying that the internet was a load of hype.  Someone or other once said that it would have the impact of the fax machine and nothing more. Apparently they give out Nobel Prizes for that sort of thing. You want - and actually expect - that the G7 is going to ban bitcoin on the basis of the HSE succumbing to a ransomware attack?  How about the HSE sharpening itself up and improving its network security?
I haven't missed the nub of any such 'argument'. It's one that has been brought up here before and it doesn't stand up to scrutiny. If you disagree - fine - but that's not my view on the subject.



			
				letitroll said:
			
		

> Bitcoin - is not an incremental improvement for society or a demonstrable improvement on what went before (blockchain the underpinning technology is possibly, I admire it but I have yet to see it solve any real world problems at scale yet.But i think it might). Bitcoin has not improved ANYONES lives that I know personally nobody not a single person (except for those gambling on it that have made money and are happy - so gamblers maybe?



Bitcoin offers individuals the ability to self custody wealth, to store it and to transmit it digitally without an intermediary. You'd do well to acknowledge that as a basic improvement and another choice that people otherwise haven't had available to them. I haven't heard the 'blockchain not bitcoin' mantra for a couple of years. It's what the banking set tried to claim - they've long since given up on that. Explain to us please how 'blockchain' has potential yet bitcoin doesn't?  Over a number of years there has been a theme here where people will not concede to recognise a single positive facet of what the bitcoin network brings to the table. Blockchain technology as a whole has been advanced by the developer(s) behind bitcoin solving the double spend issue - but sure - lets give it credit for nothing. I draw my own conclusions from that.

As regards bitcoin not improving the lives of anyone you know - are you suggesting that this is the vital metric in determining the efficacy or otherwise of bitcoin? If bitcoin is so useless to society, why do people like civil liberties advocate Edward Snowden think it's a great advancement? When the US government leaned on visa/mastercard to prevent Wikileaks from receiving donations from the general public, the organisation turned to bitcoin - as it's one opportunity to continue to fund the organisation.

Why are people like Alex Gladstein of the Human Rights Foundation such proponents of bitcoin in terms of its value to society going forward?

In a tweet and accompanying article earlier this week, Gladstein spelled out precisely why your metric (i.e. none of my friends have had their lives improved as a result of bitcoin ) is flawed:


__ https://twitter.com/i/web/status/1392510479541563395


letitroll said:


> I dont use it to pay for things,


That doesn't prove anything. And of those that don't use it for such a purpose today, that in no way means that this is the case as we progress. Secondly, you're running with either the convenience or misunderstanding that if it doesn't do what you expect of it today, then that's it - we write it off. I couldn't disagree with that view more. What if we applied that logic to the development of the internet, its origins going back to the development of ARPANET in the late sixties. Lets say you passed judgement on it when it had scaling issues at the dial-up internet stage? You may be prepared to pass judgement on it today but I certainly won't do that.
The ability to pay for things with it firstly is still developing. You realise that we were all born into a world that already had fiat money - and accompanying systems and financial infrastructure in place from the get go?  Further still that unlike bitcoin, use of those currencies is insisted on by force? With that backdrop, you think that with the flick of a switch, the ability to pay with bitcoin for anything can happen just like that?  The internet faced scaling issues and overcame them. I believe bitcoin will also (not on the base layer but on layers built on top of the bitcoin network).  But you want to write it off today because your peer group thinks its a load of rubbish - good luck with that but it's not an opinion I share.



letitroll said:


> i send my friends money using revolut instantly and for free


Whilst neo-banks like Revolut are proving to be incredibly popular, the vast majority of people transfer funds via their bank account - for which there are banking fees.
On Revolut, sure you can but if all Revolut customers utilised the service without an ATM card, they'd have to start charging fees. The vast majority of people use the service with an accompanying ATM card - and you pay €30 stamp duty on that per year for starters. You chose transferring money to friends as your example rather than paying for goods and services with Revolut - a process through which they make money on - and said process builds in the cost into the price of the item you're buying already - ergo such a transaction isn't free.  If you withdraw funds from an ATM via Revolut, you'll also pay fees at a certain point. If you do so abroad, you'll incur FX fees and local bank transaction fees.



			
				letitroll said:
			
		

> (you've seen coinbase fees right?)


So against a very specific example, you contrast that with Coinbase fees in particular? I have a Coinbase account that I don't use because I don't like their high fees or their customer service. Their high fees are well known - which it seems is why you use that specific example.  You could use the example of switching up from a regular Coinbase account to Coinbase Pro where the fees are lesser. You could take it a step further and use Binance where fees can be as low as 0.02%. In an industry that's only getting started, it's not so unusual to have higher fees to begin with. There will always be downward pressure as such markets expand. The documents that accompanied the Coinbase direct listing acknowledged that downward pressure on fees going forward.

But lets not do any of those things. I can transfer bitcoin to my friends from my Breez Wallet to their Breez Wallet for a fraction of a cent regardless of what jurisdiction they're in or where they are in the world. That already makes it cheaper than Revolut. Furthermore, I or they don't necessarily have to have an associated bank account or complete/submit paperwork, etc. Added to that, there are plenty of jurisdictions where Revolut or the likes of it simply isn't available.



			
				letitroll said:
			
		

> we have a digital and analogue currency already, a high volume, low cost payments system with low energy consumption.


Bitcoin in its current form as a base settlement layer - without any further development - can match the capacity of Fedwire. Lightning network - running on top of the bitcoin base layer - can match the visa/mastercard network in terms of thru-put - with significant savings to be made for vendors/consumers over visa/mastercard.
All the while you are assuming that in every part of the world, its hunky dory to have an intermediary involved. I guess that's because you're using your peer group as a metric of bitcoins efficacy. There are many parts of the world where this is a major issue. You're also assuming that neo-banks or even bank accounts are available to everyone - they're not. I live in a country where it's incredibly difficult to get a visa/mastercard or any form of card that will work internationally.  That's the norm in said country. That country also mismanages its currency and enforces unruly capital controls. I managed to extract my funds thanks to crypto - just before the currency managed to nosedive in valuation over and above all the other fiat currencies (there's a lot of competition right now in the race to the bottom).
As regards the low energy consumption, that is a complete and utter falsehood.  And just to head this off before you come back on this, Visa or Revolut are not base layers. They don't get to exist without all the rest of the banking and currency infrastructure.  Bitcoin is a base settlement layer and an entire monetary system in its own right.




			
				letitroll said:
			
		

> It FAILS the improved currency, payment mechanism AND store of value VERSUS what we have already.



It does no such thing. The removal of intermediaries is an advancement. It decreases settlement risk and third party custodian risk. It prevents governments from taking a haircut to your hard earned savings or in many jurisdictions, simply confiscating your funds. It prevents banks disposing of your life savings - of which there are many examples. And by the way, whilst you're so comfy back in Ireland, we came within a hairs breath of the very same thing.  That sort of event only has to happen once!
It can act against the stealth tax that is imposed on citizens worldwide via inflating fiat currencies...or in cases of countries that have totally mismanaged their currency to the point where they've destroyed the local currency. Pick from a list of examples in any given year.



			
				letitroll said:
			
		

> Bitcoin FAILS the incremental human society/technology improvement test


Because your peer group told you so?  That's a complete falsehood - as I've set out above. Read Gladstein's tweet and accompanying article.  Pay heed to the fact that it is wayward to pass judgement on an innovation that has yet to mature.



			
				letitroll said:
			
		

> (with the downside that its so useful for extortionists and kidnappers).


Cash is the currency of choice of criminals - hands down. Credit card fraud is rampant - the bill for it in the US alone comes to around $6 billion per year. Meanwhile, banks have paid out $330 billion in fines related to fraud and market manipulation since 2008. They still carry on with facilitating money laundering at the highest level because they're only paying cents on the dollar in fines - it's still very much worth their while.




			
				letitroll said:
			
		

> Bitcoin has higher fees than fiat


No it doesn't. See above. If you're talking micro-transactions, bitcoin can be transacted via the lightning network for fractions of a cent. That makes it cheaper than fiat.
When it comes to larger international transactions, then transactions on the bitcoin base settlement layer are more cost effective than moving fiat.  And if we want to get in to very large sums, then its more cost effective again. It also allows for direct settlement with no counterparty risk. Have you ever carried out an international wire transfer? How much did it cost and how long did it take?



			
				letitroll said:
			
		

> it cant process transactions at the scale of visa/mastercard


See above - via layer 2, yes it can match visa/mastercard throughput.



			
				letitroll said:
			
		

> It's more volatile than currency/gold so is a poor store of predictable long term value for people.


It is volatile because it has yet to mature as an asset. As a store of value over the longer term, its proven to be an excellent store of value. If you're presenting with a low time preference right now, sure - it could have shorter term issues as a store of value.  However, you've opened on the payments angle. If you're going to go into store of value use case and comparisons with gold, then we'll have to go through everything - not just certain points that you pick out because bitcoin has several advantages over gold and its going to pull market cap away from it on that basis.
Once it matures, I expect it to be just as boring as gold in this respect. You should also note that in its not too distant past, gold also presented as being just as volatile yet nobody seems to mind.



			
				letitroll said:
			
		

> The argument that it somehow cant be diluted/devalued like fiat has been utterly destroyed by the literally 1000's of competing coins - Dogecoin for one.....that have been created to compete with it for the store of value/transaction function. Is this not fiat currency printing-esque in its nature?No? Explain how I'm wrong?


Absolute rubbish.  Others before you have presented with this and it doesn't wash.  Firstly of the gazillions of projects, very few of them have anything to do with store of value / currency use case. Beyond that, go out and do it then.  Go out and start letitroll-coin and see how far you will get.  You realise that bitcoin is a trillion dollar asset? You can ignore network effect all day long but I certainly have no intention of doing so.
As regards Doge, it was started as a meme - not for use as a currency or store of value. Even if it gains some traction for payments it in no way detracts from bitcoin. I'm open to bitcoin still being usurped but at this stage, it can only be by something that is 10x better than it - not something that may have the upper hand on one single characteristic whilst failing the others.



			
				letitroll said:
			
		

> Bitcoin itself is not just an adjunct tool in the carrying out of a crime (like your car example, mobile phone, computer, internet).......it is the object /the aim of the crime itself....the motivator.......the vehicle in which the reward from the proceeds of that crime is housed.


See above. Analogue cash and digital cash are used for the vast majority of crime and fraud. There's nothing that you can say to refute that.



			
				letitroll said:
			
		

> These crimes would be pointless if the perpetrators asked for cash or bank wire they would almost certainly get caught. Bitcoin provides the greater probability that they wont. If I'm wrong on this - why have the two largest ransomware crimes been denominated in it in the last two weeks? It therefore by extension an incentive for such crimes. Its existence all things being equal - INCREASES the frequency of these crimes. If you add this to my point no. (1) failing the incremental improvement technology test while (2) making serious crime easier for the criminals while increasing the frequency of such crime. Why should society tolerate its existence? If the net benefit is negative?


So tell me - how is it that at a high level the banking system caters for money laundering?  Explain to me how cash is used extensively in the narcotics trade? How is it that we all have to cover the billions in costs when it comes to credit card fraud?




			
				letitroll said:
			
		

> Please take each point separately @tecate and explain how I'm wrong.


Please let me know if I've left any point unaddressed.  I'm still keen to understand how bitcoin threatens 100% of GDP but even more fascinated to hear how crypto threatens lives! Can you expand on that please?




			
				letitroll said:
			
		

> Please also at this point declare conflicts of interest. The old phrase - who's bread I eat, his song I sing springs to mind. I own no bitcoin and I'm not short it. This is my opinion with no directional benefit on the rising or falling of bitcoins price. Do you @tecate hold or have held bitcoin? I suspect you do. Multi-level marketing schemes like bitcoin turn owners into promoters. I get a sense of you being a promoter in this instance but perhaps I'm wrong?


Over the course of nearly 4 years here, I've made no secret of the fact that I've held bitcoin and other cryptocurrencies. My views have been consistent over that time period. Please note that over that duration, I also didn't hold crypto/bitcoin for extended periods. If you're suggesting what I think you are, then would I not talk down the market during these times?
What you should note is that if I was thinking of myself, I should be actively encouraging what I consider to be wayward beliefs as regard bitcoin. So long as there are objectors, they serve to lengthen the adoption process. A lengthening of the adoption / maturation process means more volatility and more opportunity from a speculative point of view.
Now my turn. If there is some assumption that anyone presenting here who doesn't hold bitcoin and thinks that its just plain wrong has clean hands in these discussions, I don't agree. For many, the notion of bitcoin goes against their world view and they're against it from a political point of view or they dislike the great unwashed who brought it to the fore or that it challenges an inequitable financial system - inequitable for many yet one that they are quite happy with in that they have learned to navigate it better than most or are in a privileged position to do so.



			
				letitroll said:
			
		

> I reserve the possibility, always, that I'm a moron and you are a man that has seen the future and I stand ready to have my mind changed.


I've long since clarified that I accept that bitcoin still has the potential to fail. As its network effect expands, that likelihood lessens but I still recognise it as a possible outcome.


----------



## Duke of Marmalade

WolfeTone said:


> Well let's break down the terminology - Solving complex mathematical equations.
> 
> Would it be reasonable to suggest that "solving mathematical equations" is ok with you? And that the offending piece is the word "complex"?
> 
> complex
> [ˈkɒmplɛks]
> 
> ADJECTIVE
> 
> 1. consisting of many different and connected parts.
> "a complex network of water channels"
> synonyms:
> compound · composite · compounded · multiplex
> 
> 
> I'm starting to think that you perhaps you are conflating the word "complex" with "complicated"?
> 
> Clearly your descript of 21trillion key 'guesses' would suggest that the maths is complex. But your references to 'clever' and 'sophistication' infer an interpretation of 'complicated' as well.
> As the dictionary definition above demonstrates, it would be appropriate to describe the Amsterdam canal network as complex, but not very complicated to understand.
> 
> As I understand it, there are new bitcoins 'minted' (another metaphor for adoption by crytpo) every ten minutes.
> Awarded to the miners that verify all the transactions in a block.
> 
> Compare that to the euromillions. You can gain a jackpot reward in the millions, far in excess of any bitcoin reward, if you buy tickets with every single possible combination of numbers.
> It is not very complicated, but it is very complex as there are 139,000,000 different combinations. Surely beyond the capacity of any one individual or group of individuals to manaully achieve this?
> Perhaps a simple computer program could be devised to purchase tickets for each combination of numbers?
> But at €2.50(?) a line, the jackpot would have to be €347,500,000 just to break even. I think €200m is the highest is has ever got. Worse, if you spent €347,500,000 on euromillions tickets, I think only 50% of that goes to prize money.
> Even then, anyone attempting to win the jackpot this way would have to factor the double-spend problem (rather, one or more persons picking the same combination of numbers for the same draw).
> 
> It is fair to say that the Euromillions have established a robust, fool-proof system to ensure the integrity of the euromillions. It's not very complicated, but it is complex.
> 
> As for bitcoin, the maths are far more complex ensuring the integrity of the network.


What a loada midnight baloney.
Performing a SHA256 trial does not *Solve* anything, I invited you to try it.
There is nothing *Complex*/complicated/intricate/sophisticated about it.
It requires absolutely zilch *mathematical* background
It involves no *equations* whatsoever
But hey, “solving complex mathematical equations” is a tad more impressive than buying gazillions of lottery tickets, which by the way is an excellent analogy which I might address later.


----------



## Duke of Marmalade

@tecate I note your comment that credit card fraud costs $6bn a year in the US alone.
Research using Chainanalysis has shown that 1% of bitcoin’s $90bn per day transactions are criminal.  That is a total of $300bn per year, 50 times US credit card fraud.


----------



## WolfeTone

Duke of Marmalade said:


> which by the way is an excellent analogy which I might address later.



Please do. 
I was listening to a senior executive of a world leading gambling company explain the business model in lay man's language. 

He said basically the model is, the punter gives the bookie €10 and the bookie gives the punter €8 back. 

Not very sophisticated, nothing really clever about it. 
Of course, in-between the base monetary exchange between punter and bookie there is a complex, sophisticated business strategy at play. 

But in essence, your concern over the terminology applied to bitcoin is a grossly exaggerated concern.


----------



## Duke of Marmalade

WolfeTone said:


> But in essence, your concern over the terminology applied to bitcoin is a grossly exaggerated concern.


It only feels grossly exaggerated because we are in the rabbit hole.  But I stated in #627 that it is not a monster point.  It has been made a monster point in this rabbit hole by yourself and @tecate.  Why don't you just concede that the process of mining does not involve "solving complex mathematical equations" but that it is not a monster point. Then we can all move on to the next rabbit hole.


----------



## Duke of Marmalade

WolfeTone said:


> Please do. (elaborate on the lotto analogy)


Well I will keep my promise.  The figures are quite staggering.  Just to give a bit more background a trial or  in your analogy a purchase of a bitcoin lotto ticket involves performing the following SHA256 operation.
SHA256 (Block header  + nonce)
This produces your lotto number.  It is the nonce which you change on a totally arbitrary basis to generate a new lotto number.
If your lotto number has a certain number of leading zeros you win and can open the box and make off with your bitcoins.  Note in passing that unlike real lotto there can only be one winner in each play.
The number of leading zeroes is chosen to make the chances of winning such that there is a winner about every 10 minutes.  The more people playing the game the harder the protocol makes it to win.
If you pick 6 numbers in the Irish Lotto the chances of them winning is about 1 in 11 million.  The original bitcoin lotto difficulty was set at 400 times this.  It is currently 100 trillion times harder than the Irish Lotto 
Of course bitcoin lotto tickets are much much cheaper than Irish Lotto tickets, basically the cost of electricity in running SHA256.  The "difficulty" can then be seen as an economic equilibrium between the prize for winning (currently $300k but rapidly falling) and the cost of each ticket.
If there was nothing in the box, which is the ultimate aim, then the only incentive in opening it would be to get the transaction fees.  That would quickly weed out the marginal players and bring down the difficulty.


----------



## WolfeTone

Duke of Marmalade said:


> Why don't you just concede that the process of mining does not involve "solving complex mathematical equations" but that it is not a monster point.



You have conflated the terminology to something in your own mind, and words, that should represent something far more sophisticated, intricate and clever. For my own part



WolfeTone said:


> I admit on the technological side I'm not totally bowled over by bitcoin



You have allowed _yourself_ to be seduced by the language into thinking it is something that functions in some futuristic groundbreaking mathematical advancement. When all along, how it operates is posted on a 8 page whitepaper that doesn't even mention the words "complex mathematical equations".
That is why I reference the euromillions.
The underlying fundamentals of it are neither sophisticated or groundbreaking. But it delivers time and time again on its objectives. To guarantee a win of the jackpot I need to solve a simple mathematical equation. I know that if I buy one line I have 1/139000000 chance of winning.
So if I buy 139m/139m lines I know I am guaranteed to win the jackpot and all prizes in between. But it is complex procedure and cost prohibitive, risk from prize sharing etc, so basically my efforts to try undermine and exploit this system are futile. That is the mathematical equation that the euro millions has solved in order to keep the integrity of its system working.

Bitcoin has solved the mathematical equation of protecting its decentralised network from attack by reducing the probability of a successful attack to next to zero.
The process that is applied to that equation is neither sophisticated nor complicated.
Bitcoin is open for anyone and everyone to improve what bitcoin does. If someone can produce a better a system it will replace bitcoin.
But we will just be talking about #betterbitcoin, not BOHA.


----------



## noproblem

Is it possible that the goverment will pay a ransom in Bitcoin or similar to get the computer system back?


----------



## Duke of Marmalade

WolfeTone said:


> You have conflated the terminology to something in your own mind, and words, that should represent something far more sophisticated, intricate and clever. For my own part


Mining does not involve, by any process of conflation or otherwise, "solving complex mathematical equations".  It was @joe sod who used the term but I have seen it before in cultist explanations of how bitcoin works.  It is a term which obviously flatters the process in the minds of the cult.  Why you don't admit its inappropriateness and move on is a mystery to me. 


WolfeTone said:


> You have allowed _yourself_ to be seduced by the language into thinking it is something that functions in some futuristic groundbreaking mathematical advancement.


Yes indeed, when I first read a cultist explanation of how it works that is what I thought must be at play.  A big disappointment when I discovered the mind bogglingly boring truth.


WolfeTone said:


> The underlying fundamentals of it are neither sophisticated or groundbreaking. But it delivers time and time again on its objectives. To guarantee a win of the jackpot I need to solve a *simple* mathematical equation. I know that if I buy one line I have 1/139000000 chance of winning.


Obviously not simple enough.  Our posts crossed in which I cited the number 11m.  The truth is as follows:


			
				wiki said:
			
		

> The current *odds of winning* (in a 6/47 *lottery*) are: Jackpot - 1 in 10,737,573





WolfeTone said:


> Bitcoin has solved the mathematical equation of protecting its decentralised network from attack by reducing the probability to next to zero.


That is not the main reason for the difficulty in solving the bitcoin lotto.  The main reason is to slow down the release of the money supply to every 10 minutes.  I recommend Antonopolous to you.


WolfeTone said:


> The process that is applied to that equation is neither sophisticated nor complicated.


Point of agreement at last.


----------



## tecate

Duke of Marmalade said:


> @tecate I note your comment that credit card fraud costs $6bn a year in the US alone.
> Research using Chainanalysis has shown that 1% of bitcoin’s $90bn per day transactions are criminal.  That is a total of $300bn per year, 50 times US credit card fraud.


You'll twist and turn any which way to try and contrive the outcome you want Duke. A statistic on illicit use vs. fraud in one specific country are not the same thing. Credit card fraud is theft from each and every credit card holder.  The statistic given was for the US - not the entire world. Illicit use is by far and away a more broad statistic. You might as well be comparing apples with dragon fruit.

I didn't know that we were moving goalposts but seeing as we are, lets get into it. Here's (which is owned by financial institutions) which was published in 2020. In it, its states:

*“cases of laundering through cryptocurrencies remain relatively small compared to the volumes of cash laundered through traditional methods,”*

That's a comparison with cash - before we get into banking, credit cards, etc. Another report suggests that the ratio of money laundering in fiat  dwarfs that of bitcoin at a rate of 800:1. Yet another report published last year revealed $2 trillion in bank transactions that the banking system flagged as dodgy but processed nonetheless. 



Duke of Marmalade said:


> But I stated in #627 that it is not a monster point.  It has been made a monster point in this rabbit hole by yourself and @tecate.  Why don't you just concede that the process of mining does not involve "solving complex mathematical equations" but that it is not a monster point. Then we can all move on to the next rabbit hole.


Ergo its no point!  Imagine making a song and dance about the complexity of bitcoin's network security when that algorithm is responsible for a level of network security that is widely acclaimed.



			
				Duke of Marmalade said:
			
		

> Why you don't admit its inappropriateness and move on is a mystery to me.


Why you would make a meal out of this when I've never heard anyone else do so - is much less of a mystery Duke!


----------



## WolfeTone

Duke of Marmalade said:


> It was @joe sod who used the term



Perhaps you should take the matter up with him then? 



Duke of Marmalade said:


> It is a term which obviously flatters the process in the minds of the cult. Why you don't admit its inappropriateness and move on is a mystery to me



But I dont use the term. And in the instances that others use it I understand it to mean what I have outlined to you. It is yourself that has conflated the term into meaning something of higher grandeur than it actually is. There is alot of terminology and associated memes with bitcoin that I don't conflate into anything other than the metaphors they are, regardless of which perspective you come at with bitcoin. 

HODL
BOHA
'To the moon' 
Laser-eyes. 
Cult

Perhaps you could admit the inappropriateness of some of this terminology and then move on yourself?


----------



## Duke of Marmalade

WolfeTone said:


> Perhaps you should take the matter up with him then?


I took it up with nobody in particular but it was yourself and @tecate who made a monster out of it.


----------



## Duke of Marmalade

tecate said:


> You'll twist and turn any which way to try and contrive the outcome you want Duke. A statistic on illicit use vs. fraud in one specific country are not the same thing. Credit card fraud is theft from each and every credit card holder.  The statistic given was for the US - not the entire world. Illicit use is by far and away a more broad statistic. You might as well be comparing apples with dragon fruit.
> 
> I didn't know that we were moving goalposts but seeing as we are, lets get into it. Here's (which is owned by financial institutions) which was published in 2020. In it, its states:
> 
> *“cases of laundering through cryptocurrencies remain relatively small compared to the volumes of cash laundered through traditional methods,”*
> 
> That's a comparison with cash - before we get into banking, credit cards, etc. Another report suggests that the ratio of money laundering in* fiat  dwarfs that of bitcoin at a rate of 800:1*. Yet another report published last year revealed $2 trillion in bank transactions that the banking system flagged as dodgy but processed nonetheless.


Some fair points.  All the same if bitcoin illicit transactions are $300bn per year and "fiat dwarfs it at a rate of  800:1" that's $240trillion, one wonders is there any ligit activity in fiat at all.


----------



## tecate

Duke of Marmalade said:


> I took it up with nobody in particular but it was yourself and @tecate who made a monster out of it.


You raised a complete and utter nothing burger, Duke. However, it is insightful as it confirms that you have zero objectivity in assessing bitcoin when you turn your nose up at what you deem to be an algo that lacks complexity yet its an algo that has been widely acclaimed for doing exactly what it says on the tin -> securing the network.



			
				Duke of Marmalade said:
			
		

> Some fair points. All the same if bitcoin illicit transactions are $300bn per year and "fiat dwarfs it at a rate of 800:1", one wonders is there any ligit activity in fiat at all.


Ponder what you like Duke. Circling back to where this began, bitcoin is much less a means of illicit transactions than fiat currency - that's the bottom line despite the ongoing attempts to tar and feather it.


----------



## WolfeTone

Duke of Marmalade said:


> I took it up with nobody in particular but it was yourself and @tecate who made a monster out of it.



Hardly. My only point was the adoption of terminology, metaphors etc to describe processes, concepts etc is as old as the hills. 
You do appear to take exception to some of the terminology often applied to bitcoin. That is fair enough, but when you apply your own metaphors 'BOHA', 'cult', then that's ok then? 
Your tendency to conflate and exaggerate stated positions into something they are not (in this instance 'monster') is well understood. 

Anyway, not a major point at all.


----------



## Duke of Marmalade

tecate said:


> Ponder what you like Duke. Circling back to where this began, bitcoin is much less a means of illicit transactions than fiat currency - that's the bottom line despite the ongoing attempts to tar and feather it.


You are good at throwing out statistics.  Maybe you should credibility check them before doing so. The following three statistics as quoted by you seem very hard to reconcile with the below United Nations quote.
Bitcoin transactions are running at $90bn per day or $33trn per year
Bitcoin illicit transactions are 1% of this, that is $0.33trn per year, let's double that up to $0.66tn per year to cover all crypto
Fiat dwarfs bitcoin by a ratio of 800:1 for money laundering


			
				United Nations said:
			
		

> The estimated amount of money laundered globally in one year is 2 - 5% of global GDP, or $800 billion - $2 trillion in current US dollars.


----------



## tecate

Duke of Marmalade said:


> You are good at throwing out statistics.  Maybe you should credibility check them before doing so. The following three statistics as quoted by you seem very hard to reconcile with the below United Nations quote.


Says the guy that tried to suggest to us that comparing a credit card fraud statistic against an overall illicit use  statistic was reasonable!  These are the only scraps you reduce yourself to Duke - this and complaining about your perception of simplicity when it comes to the algorithm thats at the heart of a very robust bitcoin network security mechanism.

You're now trying to fudge it by comparing different research not knowing what parameters and definitions they used in an attempt to discredit.

The report from Swift - they're your banking set buddies - not mine.


----------



## Duke of Marmalade

tecate said:


> Says the guy that tried to suggest to us that comparing a credit card fraud statistic against an overall illicit use  statistic was reasonable!  These are the only scraps you reduce yourself to Duke - this and complaining about your perception of simplicity when it comes to the algorithm thats at the heart of a very robust bitcoin network security mechanism.
> 
> You're now trying to fudge it by comparing different research not knowing what parameters and definitions they used in an attempt to discredit.
> 
> The report from Swift - they're your banking set buddies - not mine.


Fair enough.  No explanation for the wildly contradictory stats.
I suppose I must do my own credibility checks on any future propaganda stats you bandy our way.


----------



## tecate

Duke of Marmalade said:


> Fair enough.  No explanation for the wildly contradictory stats.
> I suppose I must do my own credibility checks on any future propaganda stats you bandy our way.


From my previous post:
"You're now trying to fudge it by comparing different research not knowing what parameters and definitions they used in an attempt to discredit."

This is what your banking set buddies at Swift stated in their report:

*“cases of laundering through cryptocurrencies remain relatively small compared to the volumes of cash laundered through traditional methods"*

I've provided link to the report so if you'd like to critique it, have at it.


----------



## 24601

Interesting discussion on Eamon Dunphy's podcast today with Ronan Murphy of Smarttech where he noted that there has been a recent increase in cybercrime that corresponds very closely with the increase in the price of Bitcoin. He mentioned that an analysis of certain wallets used by hacker syndicates provided strong evidence of this.


----------



## tecate

24601 said:


> Interesting discussion on Eamon Dunphy's podcast today with Ronan Murphy of Smarttech where he noted that there has been a recent increase in cybercrime that corresponds very closely with the increase in the price of Bitcoin. He mentioned that an analysis of certain wallets used by hacker syndicates provided strong evidence of this.


Are you suggesting that the uptick in the price of bitcoin over the course of the past few months is accounted for by cybercrime?
That certain wallets belonging to hackers have increased funds in them is a long way from providing any credible evidence that this is the primary activity on the network as a whole. What specific analysis did he cite?


----------



## Duke of Marmalade

tecate said:


> From my previous post:
> "You're now trying to fudge it by comparing different research not knowing what parameters and definitions they used in an attempt to discredit."
> 
> This is what your banking set buddies at Swift stated in their report:
> 
> "*“cases of laundering through cryptocurrencies remain relatively small compared to the volumes of cash laundered through traditional methods"
> 
> Ive provided link to the report so if you'd like to critique it, have at it.*


Actually I suppose the stats can be reconciled in a way.
UN says topside ML is 2 trn p.a.
"Another report" states that bitcoin is 1/800th of this.  Topside $2.5bn p.a.
Chainanalysis reports $300bn p.a. illicit activity on bitcoin
So the vast bulk of this is not on money laundering, which you regard as harmless compared to credit card fraud
So what do you think the other $297.5 p.a. of illicit transactions in bitcoin are covering?


----------



## tecate

Duke of Marmalade said:


> Actually I suppose the stats can be reconciled in a way.


How can they when you have no earthly idea what definitions of illicit use, fraud, etc. they ran with and what parameters were set? You're doing your best to bend and shape this to fit your narrative.



Duke of Marmalade said:


> So the vast bulk of this is not on money laundering, which you regard as harmless compared to credit card fraud


It was YOU who took the lesser measure (the cc fraud stat) and tried to suggest it was so much less than the illicit transactions stat - whilst trying to suggest to people that this was a reasonable comparison!
And just for the record - in no way do I deem money laundering to be harmless by comparison with credit card fraud. Your big banking friends have paid $330 billion in fines related to it since 2008. That's just related to what was detected - so its fair to say, a fraction has been detected. I don't think your banking buddies will want bitcoin muscling in on this lucrative and highly profitable illicit activity.


----------



## Duke of Marmalade

tecate said:


> Your big banking friends have paid $330 billion in fines related to it since 2008. That's just related to what was detected - so its fair to say, a fraction has been detected.


And there have been no bitcoin related fines.  But sure isn't that the selling point.  Bitcoin is decentralised and accountable to nobody.


----------



## tecate

Duke of Marmalade said:


> And there have been no bitcoin related fines.  But sure isn't that the selling point.  Bitcoin is decentralised and accountable to nobody.


I guess then that you're now conceding that the current system is a complete sham.  You don't deny that big banking moves billions for the cartels and others. Do you want to explain to folks why in jurisdictions like ours, you can go to prison for not paying your TV license and yet in this HSBC fiasco, not one banking executive spent a minute behind bars?

Bitcoin is decentralised, yes. That doesn't stop regulators regulating - if you have an issue with that, then take it up with regulators. It doesn't stop law enforcement investigating. In its current form, bitcoin is a wet dream for them - as it's only psuedo-anonymous - making it incredibly easy to trace.


----------



## Duke of Marmalade

tecate said:


> And just for the record - in no way do I deem money laundering to be harmless by comparison with credit card fraud.


And just what does the following mean?


			
				tecate said:
			
		

> Credit card fraud is theft from each and every credit card holder.


By most people's moral compass stealing money, ransomware, human trafficking etc. are greater evils than concealing the proceeds and that is what you meant here and I agreed with you.
You now claim that you hold theft and concealing the proceeds to be on the same moral plain.  You are ducking and diving and I don't like that except that it shows my forensic analysis of your stats has you squirming.


----------



## tecate

Duke of Marmalade said:


> By most people's moral compass stealing money, ransomware, human trafficking etc. are greater evils than concealing the proceeds and that is what you meant here and I agreed with you.


Have you lost the run of yourself entirely, Duke?  I don't remember getting into a discussion about what's the greater evil between crimes. This started out with a claim that bitcoin is being used almost exclusively for criminality when in-depth on-chain analysis has demonstrated it stands at no more than 1%. Furthermore, we have your banking buddies at SWIFT backing up the claim that illicit transactions on the bitcoin network are in the ha'penny place by comparison with cash. Ergo that claim has well and truly been debunked.



Duke of Marmalade said:


> You now claim that you hold theft and concealing the proceeds to be on the same moral plain.  You are ducking and diving and I don't like that except that it shows my forensic analysis of your stats has you squirming.



Your 'forensic analysis'? Hold on...let me pick myself up off the floor.  Where were we? Ah yes, your 'forensic analysis' where you tried to compare a subset of illicit activity (credit card fraud) and say look! it's only a fraction of what goes on - on the bitcoin network (when compared with ALL illicit activity!).  That forensic analysis?  I've said it many times but this underscores it. There's NO objectivity to your critique of bitcoin / crypto because you have deep seated political views against it.


----------



## 24601

tecate said:


> Are you suggesting that the uptick in the price of bitcoin over the course of the past few months is accounted for by cybercrime?
> That certain wallets belonging to hackers have increased funds in them is a long way from providing any credible evidence that this is the primary activity on the network as a whole. What specific analysis did he cite?



No, he was suggesting that the high value of Bitcoin, and the relative ease with which it can be "hidden" from the authorities, had reached a level whereby the price of Bitcoin was incentivising more cybercrime. I never said he said it was the primary activity on the network as a whole but it is clearly a fairly significant problem.


----------



## tecate

24601 said:


> No, he was suggesting that the high value of Bitcoin, and the relative ease with which it can be "hidden" from the authorities, had reached a level whereby the price of Bitcoin was incentivising more cybercrime. I never said he said it was the primary activity on the network as a whole but it is clearly a fairly significant problem.


Well, if either of us were in the ransomware business, I can't imagine either of us would give a fiddlers what the price of bitcoin is?  If the scammers are looking for $5 million in bitcoin, then they end up with the equivalent amount in bitcoin based on whatever the price is at a given time.

There's certainly an opportunity for these types of scammers to harness certain characteristics of bitcoin to execute their scam. However, it remains just a tool. That's why headlines that state 'bitcoin scammers did X' are wayward. They're not 'bitcoin scammers' - they're scammers who just happen to utilise bitcoin as a tool. In the same way as fraudsters who exploit vulnerabilities with credit cards are fraudsters who utilise that means. scammers who exploit atm vulnerabilities - where the currency is cash, narcos where the medium is cash, cheque fraud....you get the idea.

In terms of it being a 'fairly significant problem', I'm sure it is - albeit that the data we have suggests that on the whole, it's included in that rate of 1% of transactions.  It's still lower than that of fiat currency but of course just as people lament the 'bitcoin hype', who said that said hype always has a positive spin on it?  In these cases, its getting far more coverage than it deserves relative to all other scams going on.


----------



## WolfeTone

24601 said:


> No, he was suggesting that the high value of Bitcoin, and the relative ease with which it can be "hidden" from the authorities, had reached a level whereby the price of Bitcoin was incentivising more cybercrime.



This makes little sense. I'm guessing if you are smart enough to carry out a sophisticated cyber attack then Im guessing you would be smart enough to figure out that if bitcoin was 1/10th of the price it is now, you would ransom 10 times more bitcoin to satisfy your demand.


----------



## Duke of Marmalade

@tecate your stats supplemented by UN stats indicate that $2.5bn p.a. topside is laundered through bitcoin. Heck I wouldn’t begrudge them that.  The remaining illicit $297.5bn per Chainanalysis is spent on what?  Human trafficking?  Drugs trafficking?  Ransomware? They are revealing statistics for which we are all grateful to you, but nonetheless disturbing.  Have you any idea how much MBBF* are involved in these activities, I am sure the cult has tracked that down.

* My Big Banking Friends


----------



## tecate

Duke of Marmalade said:


> @tecate your stats supplemented by UN stats indicate that $2.5bn p.a. topside is laundered through bitcoin. Heck I wouldn’t begrudge them that.  The remaining illicit $297.5bn per Chainanalysis is spent on what?  Human trafficking?  Drugs trafficking?  Ransomware?


Still trying to prove black is white, your Dukeness?  What you're going on with here is irrelevant because your jumbling up numbers and stats taken from different studies - not knowing what specific parameters each study set. I'm not buying what you're selling.


----------



## letitroll

tecate said:


> Whilst I'm quite happy to adjust my view as things progress, somehow I doubt that.
> 
> 
> The point is valid. I'm not in favour of kneejerk reactions - throwing the baby out with the bathwater. The same 'logic' was pushed about before the internet reached critical mass - the call back then was that it was the tool of pedo's and criminals and was of little use to society. Articles were published saying that the internet was a load of hype.  Someone or other once said that it would have the impact of the fax machine and nothing more. Apparently they give out Nobel Prizes for that sort of thing. You want - and actually expect - that the G7 is going to ban bitcoin on the basis of the HSE succumbing to a ransomware attack?  How about the HSE sharpening itself up and improving its network security?
> I haven't missed the nub of any such 'argument'. It's one that has been brought up here before and it doesn't stand up to scrutiny. If you disagree - fine - but that's not my view on the subject.
> 
> 
> 
> Bitcoin offers individuals the ability to self custody wealth, to store it and to transmit it digitally without an intermediary. You'd do well to acknowledge that as a basic improvement and another choice that people otherwise haven't had available to them. I haven't heard the 'blockchain not bitcoin' mantra for a couple of years. It's what the banking set tried to claim - they've long since given up on that. Explain to us please how 'blockchain' has potential yet bitcoin doesn't?  Over a number of years there has been a theme here where people will not concede to recognise a single positive facet of what the bitcoin network brings to the table. Blockchain technology as a whole has been advanced by the developer(s) behind bitcoin solving the double spend issue - but sure - lets give it credit for nothing. I draw my own conclusions from that.
> 
> As regards bitcoin not improving the lives of anyone you know - are you suggesting that this is the vital metric in determining the efficacy or otherwise of bitcoin? If bitcoin is so useless to society, why do people like civil liberties advocate Edward Snowden think it's a great advancement? When the US government leaned on visa/mastercard to prevent Wikileaks from receiving donations from the general public, the organisation turned to bitcoin - as it's one opportunity to continue to fund the organisation.
> 
> Why are people like Alex Gladstein of the Human Rights Foundation such proponents of bitcoin in terms of its value to society going forward?
> 
> In a tweet and accompanying article earlier this week, Gladstein spelled out precisely why your metric (i.e. none of my friends have had their lives improved as a result of bitcoin ) is flawed:
> 
> 
> __ https://twitter.com/i/web/status/1392510479541563395
> 
> That doesn't prove anything. And of those that don't use it for such a purpose today, that in no way means that this is the case as we progress. Secondly, you're running with either the convenience or misunderstanding that if it doesn't do what you expect of it today, then that's it - we write it off. I couldn't disagree with that view more. What if we applied that logic to the development of the internet, its origins going back to the development of ARPANET in the late sixties. Lets say you passed judgement on it when it had scaling issues at the dial-up internet stage? You may be prepared to pass judgement on it today but I certainly won't do that.
> The ability to pay for things with it firstly is still developing. You realise that we were all born into a world that already had fiat money - and accompanying systems and financial infrastructure in place from the get go?  Further still that unlike bitcoin, use of those currencies is insisted on by force? With that backdrop, you think that with the flick of a switch, the ability to pay with bitcoin for anything can happen just like that?  The internet faced scaling issues and overcame them. I believe bitcoin will also (not on the base layer but on layers built on top of the bitcoin network).  But you want to write it off today because your peer group thinks its a load of rubbish - good luck with that but it's not an opinion I share.
> 
> 
> Whilst neo-banks like Revolut are proving to be incredibly popular, the vast majority of people transfer funds via their bank account - for which there are banking fees.
> On Revolut, sure you can but if all Revolut customers utilised the service without an ATM card, they'd have to start charging fees. The vast majority of people use the service with an accompanying ATM card - and you pay €30 stamp duty on that per year for starters. You chose transferring money to friends as your example rather than paying for goods and services with Revolut - a process through which they make money on - and said process builds in the cost into the price of the item you're buying already - ergo such a transaction isn't free.  If you withdraw funds from an ATM via Revolut, you'll also pay fees at a certain point. If you do so abroad, you'll incur FX fees and local bank transaction fees.
> 
> 
> So against a very specific example, you contrast that with Coinbase fees in particular? I have a Coinbase account that I don't use because I don't like their high fees or their customer service. Their high fees are well known - which it seems is why you use that specific example.  You could use the example of switching up from a regular Coinbase account to Coinbase Pro where the fees are lesser. You could take it a step further and use Binance where fees can be as low as 0.02%. In an industry that's only getting started, it's not so unusual to have higher fees to begin with. There will always be downward pressure as such markets expand. The documents that accompanied the Coinbase direct listing acknowledged that downward pressure on fees going forward.
> 
> But lets not do any of those things. I can transfer bitcoin to my friends from my Breez Wallet to their Breez Wallet for a fraction of a cent regardless of what jurisdiction they're in or where they are in the world. That already makes it cheaper than Revolut. Furthermore, I or they don't necessarily have to have an associated bank account or complete/submit paperwork, etc. Added to that, there are plenty of jurisdictions where Revolut or the likes of it simply isn't available.
> 
> 
> Bitcoin in its current form as a base settlement layer - without any further development - can match the capacity of Fedwire. Lightning network - running on top of the bitcoin base layer - can match the visa/mastercard network in terms of thru-put - with significant savings to be made for vendors/consumers over visa/mastercard.
> All the while you are assuming that in every part of the world, its hunky dory to have an intermediary involved. I guess that's because you're using your peer group as a metric of bitcoins efficacy. There are many parts of the world where this is a major issue. You're also assuming that neo-banks or even bank accounts are available to everyone - they're not. I live in a country where it's incredibly difficult to get a visa/mastercard or any form of card that will work internationally.  That's the norm in said country. That country also mismanages its currency and enforces unruly capital controls. I managed to extract my funds thanks to crypto - just before the currency managed to nosedive in valuation over and above all the other fiat currencies (there's a lot of competition right now in the race to the bottom).
> As regards the low energy consumption, that is a complete and utter falsehood.  And just to head this off before you come back on this, Visa or Revolut are not base layers. They don't get to exist without all the rest of the banking and currency infrastructure.  Bitcoin is a base settlement layer and an entire monetary system in its own right.
> 
> 
> 
> 
> It does no such thing. The removal of intermediaries is an advancement. It decreases settlement risk and third party custodian risk. It prevents governments from taking a haircut to your hard earned savings or in many jurisdictions, simply confiscating your funds. It prevents banks disposing of your life savings - of which there are many examples. And by the way, whilst you're so comfy back in Ireland, we came within a hairs breath of the very same thing.  That sort of event only has to happen once!
> It can act against the stealth tax that is imposed on citizens worldwide via inflating fiat currencies...or in cases of countries that have totally mismanaged their currency to the point where they've destroyed the local currency. Pick from a list of examples in any given year.
> 
> 
> Because your peer group told you so?  That's a complete falsehood - as I've set out above. Read Gladstein's tweet and accompanying article.  Pay heed to the fact that it is wayward to pass judgement on an innovation that has yet to mature.
> 
> 
> Cash is the currency of choice of criminals - hands down. Credit card fraud is rampant - the bill for it in the US alone comes to around $6 billion per year. Meanwhile, banks have paid out $330 billion in fines related to fraud and market manipulation since 2008. They still carry on with facilitating money laundering at the highest level because they're only paying cents on the dollar in fines - it's still very much worth their while.
> 
> 
> 
> No it doesn't. See above. If you're talking micro-transactions, bitcoin can be transacted via the lightning network for fractions of a cent. That makes it cheaper than fiat.
> When it comes to larger international transactions, then transactions on the bitcoin base settlement layer are more cost effective than moving fiat.  And if we want to get in to very large sums, then its more cost effective again. It also allows for direct settlement with no counterparty risk. Have you ever carried out an international wire transfer? How much did it cost and how long did it take?
> 
> 
> See above - via layer 2, yes it can match visa/mastercard throughput.
> 
> 
> It is volatile because it has yet to mature as an asset. As a store of value over the longer term, its proven to be an excellent store of value. If you're presenting with a low time preference right now, sure - it could have shorter term issues as a store of value.  However, you've opened on the payments angle. If you're going to go into store of value use case and comparisons with gold, then we'll have to go through everything - not just certain points that you pick out because bitcoin has several advantages over gold and its going to pull market cap away from it on that basis.
> Once it matures, I expect it to be just as boring as gold in this respect. You should also note that in its not too distant past, gold also presented as being just as volatile yet nobody seems to mind.
> 
> 
> Absolute rubbish.  Others before you have presented with this and it doesn't wash.  Firstly of the gazillions of projects, very few of them have anything to do with store of value / currency use case. Beyond that, go out and do it then.  Go out and start letitroll-coin and see how far you will get.  You realise that bitcoin is a trillion dollar asset? You can ignore network effect all day long but I certainly have no intention of doing so.
> As regards Doge, it was started as a meme - not for use as a currency or store of value. Even if it gains some traction for payments it in no way detracts from bitcoin. I'm open to bitcoin still being usurped but at this stage, it can only be by something that is 10x better than it - not something that may have the upper hand on one single characteristic whilst failing the others.
> 
> 
> See above. Analogue cash and digital cash are used for the vast majority of crime and fraud. There's nothing that you can say to refute that.
> 
> 
> So tell me - how is it that at a high level the banking system caters for money laundering?  Explain to me how cash is used extensively in the narcotics trade? How is it that we all have to cover the billions in costs when it comes to credit card fraud?
> 
> 
> 
> Please let me know if I've left any point unaddressed.  I'm still keen to understand how bitcoin threatens 100% of GDP but even more fascinated to hear how crypto threatens lives! Can you expand on that please?
> 
> 
> 
> Over the course of nearly 4 years here, I've made no secret of the fact that I've held bitcoin and other cryptocurrencies. My views have been consistent over that time period. Please note that over that duration, I also didn't hold crypto/bitcoin for extended periods. If you're suggesting what I think you are, then would I not talk down the market during these times?
> What you should note is that if I was thinking of myself, I should be actively encouraging what I consider to be wayward beliefs as regard bitcoin. So long as there are objectors, they serve to lengthen the adoption process. A lengthening of the adoption / maturation process means more volatility and more opportunity from a speculative point of view.
> Now my turn. If there is some assumption that anyone presenting here who doesn't hold bitcoin and thinks that its just plain wrong has clean hands in these discussions, I don't agree. For many, the notion of bitcoin goes against their world view and they're against it from a political point of view or they dislike the great unwashed who brought it to the fore or that it challenges an inequitable financial system - inequitable for many yet one that they are quite happy with in that they have learned to navigate it better than most or are in a privileged position to do so.
> 
> 
> I've long since clarified that I accept that bitcoin still has the potential to fail. As its network effect expands, that likelihood lessens but I still recognise it as a possible outcome.


Hi @tecate appreciate you taking the time to come back and so fully address my post. My apologies I didn't have time today to come back and give it the full answer it deserves (i was v busy earning useless fiat  ) I will come back tomorrow and get to it.

I admire your willingness to address it and the quality and thoughtfulness put into your positions. Your are part of the 1% of bitcoin loyalists who are willing to try and engage on the basis of logic. Broadly I see emotional responses from the bitcoin community - that has all the hallmarks of a religious fever at best and at worst the zeal of a bunch of multi-level marketers attempting to recruit more participants implicitly or explicitly knowing the very value of the thing they hold will increase the more people they 'get on board'.

My very quick response is that you may slightly have missed the nuance I was getting at..........whatever incremental improvement Bitcoin itself and itself only has brought to society (not talking blockchain here) is not ably covered by the downsides it has created......being its superiority over cash/bank wires as a medium of exchange for extortionists and kidnappers.

The last two pages of this thread has been a back and forth on cash/bank wires vs. bitcoin........the invention of money and the international banking system is an incremental technology/improvement that has been immense in improving the lot of human civilisation.....lest you forget the last 150 years aided by fiat money and fractional reserve banking (AND lots of other things of course) has seen the greatest progress in aggregate of human living conditions witnessed since records began.

Cash & Banking are used for BAD and enable BAD things but in aggregate we are better off for their invention & existence (see above)

Bitcoin, to date, fails to demonstrate enough incremental beneficial improvement OVER fiat cash/banking to lets call them ordinary people to outweigh the societal costs that come from creating a decentralized, anonymous store of value thats so useful to extortionists that its currently the medium of exchange in an extortion attempt that is crippling Ireland's health system. 99.9% of people currently engaging with that health system right now I can safely estimate have seen not single improvement in their lives because of the invention of bitcoin 13 years ago.....and yet here they find themselves 13 years post-BTC unable to go for scans for cancer etc. with bitcoin as a contributing factor (dont remeber any previous country wide extortion attempts & yes HSE needs to shoulder blame for cybersecruity failing but here we are and here they are no healthcare some thing called bitcoin at the centre of it all that they've never heard off!) This is the first European country in history I believe having its medical system completely brought to its knees by remote hackers demanding a bitcoin ransom. Do you not see a correlation and causation there?

So to summarise:

Fiat cash & Banking are used for BAD and enable BAD things but in aggregate we are better off for their invention & existence. The externality of extortions & kidnapping denominated in it are the price we pay for the good we get. We accept it as a cost and society agrees with me!

Bitcoin, to date, fails to demonstrate enough incremental beneficial improvement OVER fiat cash/banking to the ordinary majority lets call them to outweigh the societal costs that come from creating a decentralized, anonymous store of value thats so useful to extortionists. My bet in the next 12 months is that the G7 has come to same conclusion as me and will stomp out this backwater and aim to choke off crypto from what it really needs which is access to the Fiat banking system for its on/off ramps. Let’s  revisit in a year........I think the G7 agrees with me, not you and their actions over the next 12 months will clearly demonstrate that. The best indicator of this of course will be the price of bitcoin……its going to be hit very very very hard…..reflecting the thousand cuts the G7 will now perform.


----------



## tecate

letitroll said:


> i was v busy earning useless fiat


Good for you - and just so that there's no misunderstanding, I've never suggested it was useless - like most things, it comes with its advantages and disadvantages.



			
				letitroll said:
			
		

> Your are part of the 1% of bitcoin loyalists who are willing to try and engage on the basis of logic.


At this point - between people who are working in the sector and those who take a close interest in it - we're talking about a hell of a lot of people - and a broad spectrum of people.  Sure, there are those who's interest doesn't extend beyond a speculative punt. However, the sector has attracted a hell of a lot of talent who have walked away from careers in conventional financial services and other disciplines to work on what they see as an innovation which will have considerable impact once it fully unfolds. Therefore, if your figure is 1%, I'd say you need to change up the locations in which you are engaging with people on the topic because I don't find that in any way representative of folks who engage intelligently on this subject.



			
				letitroll said:
			
		

> Broadly I see emotional responses from the bitcoin community - that has all the hallmarks of a religious fever at best


If that's your experience, I guess that's your experience. However, be aware that exactly the same is evident in many who take the opposite view - and enter the discussion with some deep seated political views on the subject.  It very much cuts both ways.



			
				letitroll said:
			
		

> and at worst the zeal of a bunch of multi-level marketers attempting to recruit more participants implicitly or explicitly knowing the very value of the thing they hold will increase the more people they 'get on board'.


As above, perhaps you need to choose a better forum in which you engage with those who have an interest in decentralised blockchain/crypto. On the flip side, there are so many mistruths that are bandied about relative to bitcoin and decentralised crypto, many feel a need to set that straight. There's very much two sides to everything.



			
				letitroll said:
			
		

> My very quick response is that you may slightly have missed the nuance I was getting at..........whatever incremental improvement Bitcoin itself and itself only has brought to society (not talking blockchain here) is not ably covered by the downsides it has created......being its superiority over cash/bank wires as a medium of exchange for extortionists and kidnappers.


I don't think I've missed the nuance of what you were getting at - I simply disagree with it entirely. There's little point rehashing it - I've set out in my previous response some progress that bitcoin has made in terms of its contribution as a societal good and why the metric you applied (a quorum of your Irish peer group) isn't appropriate. I've also addressed the fact that like the development and roll-out of many technologies and innovations, it's a case of slow at first, then all at once. Anyone that passes summary judgement on an innovation that is still in development is doing so in error.
On the flip side, you cite the use of bitcoin by 'extortionists' and 'kidnappers'. I thought you were addressing ransomware but you're going a tad further still. So, we have epic levels of credit card fraud but that's ok in your view it seems. We have all manner of crime related to cash - which is still king when it comes to criminal use. We have the conventional banking system facilitating the cartels and organised crime at the highest echelons. You've tacked on kidnapping now also. What percentage of payments to kidnappers are made in bitcoin?
This smacks of double standards and there is no way in the world that I agree with what you're suggesting here. We don't need to take it any further than that - only to agree to disagree.



			
				letitroll said:
			
		

> The invention of money and the international banking system is an incremental technology/improvement that has been immense in improving the lot of human civilisation.....lest you forget the last 150 years aided by fiat money and fractional reserve banking (AND lots of other things of course) has seen the greatest progress in aggregate of human living conditions witnessed since records began.


I'm unaware as to what extent you've been following discussions here, but all of this has been acknowledged. My view is that systems evolve continually. The advent of decentralised cryptocurrency forms part of that evolution.  Additionally, you should note that the vast majority of people in crypto circles foresee a situation where people are given choice. That is to say, citizens have the option of using sovereign currency, private digital and decentralised digital currency. You cite a positive evolution with regard to banking and money - and I agree. However, that doesn't mean that it's not without its flaws and failings and that we shouldn't strive to seek ways to address those failings.



			
				letitroll said:
			
		

> Cash & Banking are used for BAD and enable BAD things but in aggregate we are better off for their invention & existence (see above)


Agreed - albeit that plenty of people around the world would find it hard to see it that way (i'm thinking in terms of current examples - your average Venezuelan or Lebanese - and numerous others who have had their life savings vapourised courtesy of the flaws of the existing system).



			
				letitroll said:
			
		

> Bitcoin, to date, fails to demonstrate enough incremental beneficial improvement OVER fiat cash/banking to lets call them ordinary people to outweigh the societal costs that come from creating a decentralized, anonymous store of value thats so useful to extortionists that its currently the medium of exchange in an extortion attempt that is crippling Ireland's health system.


The first part of that statement, I've tackled in my previous response to you....suffice it to say that in no way are we in agreement - so we can park it up on a agree to disagree basis. On the second part, isn't it wonderful that the HSE has a scapegoat for their incompetence. I'd be far more inclined to take an entirely different view on this subject. Ransomware has been knocking about for a quite a while. All organisations and individuals are potential victims. Larger organisations represent a larger prize. However, the expectation is that large organisations are professional and that they manage their network security accordingly. It didn't in any way surprise me that one of the most mismanaged organisations in the country succumbed to a network security breach.  But - you say  (and I'm very much sure they say!!) - it's bitcoin's fault. That's convenient for them.
The notion that the baby should be thrown out with the bathwater on the basis of someone's errant use of bitcoin isn't in any way equitable to me. Again, we won't be agreeing - so we can park it up right there.



			
				letitroll said:
			
		

> 99.9% of people currently engaging with that health system right now I can safely estimate have seen not single improvement in their lives because of the invention of bitcoin 13 years ago.


This statement is wayward in the extreme. Bitcoin is a tool - no more, no less. Like you have acknowledged with cash, banking, etc. - it can be used for good and for bad. The stakeholders who are responsible are the purpetrators of this extortion and HSE management who have failed to secure their network. But of course it's the easiest thing in the world to blame bitcoin - as it's something new that the general public still don't understand and its perfect for the HSE to deflect away from their incompetence. Better yet, it's a decentralised protocol - there is no bitcoin HQ or bitcoin CEO - so its the easiest thing in the world for them to lay the blame on it.



			
				letitroll said:
			
		

> This is the first European country in history I believe having its medical system completely brought to its knees by remote hackers demanding a bitcoin ransom. Do you not see a correlation and causation there?


I think I've set out exactly what I believe is at issue. I live in a developing nation with a history of rampant corruption and high levels of poverty. And yet I've never seen someone lying in a trolley in a hospital corridor. The issues here are human error and mismanagement - which is interesting because it's also what fails fiat-based monetary systems the world over.



			
				letitroll said:
			
		

> My bet in the next 12 months is that the G7 has come to same conclusion as me and will stomp out this backwater and aim to choke off crypto from what it really needs which is access to the Fiat banking system for its on/off ramps. Let revisit in a year........I think the G7 agrees with me, not you and their actions over the next 12 months will clearly demonstrate that.


This is something that has been a perennial topic since way back. Governments have banned bitcoin and then reversed such decisions or u-turned by turning a blind eye. When it comes to governments, incompetence knows no bounds - so of course it wouldn't surprise me in the least if such a decision was taken. If a hard line is taken, then it won't be for the reason that you mention. The G7 banning bitcoin won't in any way shape or form prevent ransomware attackers from utilising bitcoin. Quite the opposite. However, there always remain other reasons why they might go down this road. The outcome is not as clear as you would think. In the US, they would face a backlash. Wall Street are now involved - and if those guys get their fingers burnt, there will be blowback. There's also likely to be general political blowback. You may think, that couldn't possibly be - we're talking about a tiny group. However, decentralised crypto taps into the mentality of a large tract of America.  There is an ever growing number of US politicians who are vocal in their support of bitcoin and decentralised blockchain.
The US got the upper hand in recent years because it nurtured tech by allowing its open development. We only discuss bitcoin here but there are a whole host of (non-currency/store of value)-related decentralised blockchain projects being developed. Ban bitcoin and they have to ban them too.  Those entrepreneurs are incredibly mobile - now more than ever. People working in blockchain circles were ahead of the curve that came with covid - in that they already had decentralised workplaces. They will simply up sticks and leave the US - and take that innovation with them.

So right now, I think it's more likely that they don't go nuclear. If they do go nuclear, there will certainly be consequences. Anyone holding crypto will get their fingers burnt in the short term.  However, I don't agree with the thesis that this will kill it.  It will set its rate of development back but they will lose total control over it - and it will come back to bite them in the whatsits.  That's how I foresee that playing out. I could be as far out as a lighthouse - who knows. I know there are plenty of twists and turns left in this whole thing and all will be revealed soon enough.


----------



## letitroll

Pleasure to have a back forth @tecate.........we have very different views..........time will tell.

Think recently Stanley Druckenmiller pointed out that it would be highly unusual for a first of its kind of anything to come to dominate a nascent technology space.......he pointed out that Facebook was the 11th social network..........Google the 4th or 5th search engine.

BTC is possibly the AltaVista in waiting of the crypto world (for those that don't know what AltaVista was...... Google it  )


----------



## Duke of Marmalade

@letitroll You raise an interesting debate as to whether bitcoin adds or subtracts from net human welfare.  I know @tecate sees it at least partially in these terms and aligns me with the "baddies" or what he calls my Big Banking Friends.  Actually I am not really focussed on these moral dimensions (carbon footprint doesn't faze me).
My central position is with the Nobel Prize winners Stiglitz, Shiller, Krugman*, Merton and of course Professor Roubini - bitcoin is not a currency and it will be found out in the end.
But there is no doubt that bitcoin is being used today - to the tune of $90bn transactions per day according to @tecate.  So what is the balance sheet in terms of human welfare arising from that activity?  Again @tecate informs us that $300bn a year is used for illicit purposes of which only a very tiny portion is for that relatively morally blameless activity of keeping ill gotten gains away from prying eyes.  That's an awful lot of BAD.
Nonetheless this is only 1% of total activity.  So is the balance of added human welfare 99-1 in favour of bitcoin?  I don't think so.  The vast, vast majority of that activity is speculative.  I am not so prudish as to say that is BAD but I do give it a neutral.  So are there any truly added human welfare benefits which cannot be accommodated by fiat?  Not where I live can I see it.  But @tecate lives in a less fortunate part of the world and possibly he sees real added value to the citizens of that country for whom all trust in the official currency is gone.
For those who use it as a store of value, which includes in the developed world, I see eventual net misery.
Impossible to guess at a final answer to the interesting question you raise.

* I know, I know, he got it wrong on the fax machine.


----------



## tecate

letitroll said:


> Think recently Stanley Druckenmiller pointed out that it would be highly unusual for a first of its kind of anything to come to dominate a nascent technology space.......he pointed out that Facebook was the 11th social network..........Google the 4th or 5th search engine.
> 
> BTC is possibly the AltaVista in waiting of the crypto world (for those that don't know what AltaVista was...... Google it  )



It's useful to the discussion that you bring up Drukenmiller. So on the 11 May, Drukenmiller was interviewed on CNBC. With the exception of a ten minute clip, CNBC have put the 30 minute interview behind a paywall. However, we can get Business Insider's interpretation of it here. Within that interview, Drukenmiller is roundly critical of both fiscal and monetary policy. The central bank high priests that Dukey tells us we have to blindly trust are getting it wrong. On the back of that, Drukenmiller predicts that the reserve currency status of the USD will come to an end within 15 years.

For his thoughts on crypto/bitcoin, for expediency I'll just quote Business Insider directly:

_"8. "Five or six years ago, I said that crypto was a solution in search of a problem. That's why I didn't play the first wave of crypto - we already have the dollar, so what do we need crypto for? Well, the problem has clearly been identified, it's Jerome Powell and the rest of the world's central bankers."
9. "The most likely replacement for the dollar would be some kind of crypto-derived ledger system invented by some kids from MIT or Stanford or some other engineering school that doesn't exist yet."
10. "It's going to be very hard to unseat bitcoin as a store of value, because it's got a 14-year brand, and there's a finite supply. Ethereum has the lead in terms of smart contracts, in terms of commerce. But Facebook was not the first social network, it was number 11, and Yahoo may have invented the search engine, but we all know what happened with Google versus Yahoo. It's just not probable in my mind that Ethereum is gonna be the ultimate winner."_

This is the context in which he considered bitcoin's likely staying power. When it comes to Central Bank Digital Currencies (CBDCs) and private digital currency, it's going to be very easy for those entities to role them out. CBDCs are an extension of fiat and as we know, fiat isn't a thing of choice - it's use is enforced down the barrel of a gun. For private digital currency, the facebooks and google's of this world have enormous networks that they can push such currencies out onto. Bitcoin lacks any central authority and such infrastructure and so it's adoption has to be by choice and organic in nature.
Having said all that, neither of these things fulfil bitcoin's role - they're entirely different. They offer people choice and they're competing forces to an extent, but rather than put bitcoin in its place, they will condition people in the use of digital currency, provide further validation of why people need decentralised cryptocurrency and ultimately onboard more people into bitcoin.

Now you mentioned that the first of a kind rarely survives. It's not widely understood/known but bitcoin's not the first of it's kind. There were various projects that predated it. Otherwise, Drukenmiller speaks to bitcoin's network effect. I'm open to bitcoin being usurped but it will have to be something that's 10x better than it.

In our back and forth, I referred to the inequality that exists in the current system. In another more recent interview, Drukenmiller had this to say:

"I don’t think there has been any greater engine of inequality than the Federal Reserve Bank of the United States the last 11 years.”

You were quite right in suggesting that the evolutionary progression of money and banking has on balance been a positive force for society. However, it's only logical that said evolution should continue with crypto and blockchain playing a role going forward.


----------



## WolfeTone

letitroll said:


> @WolfeTone.......but could only jokingly ridicule, a sign that perhaps my points have merit & stung somewhat?



I apologise for my glib response. I have been around these parts quite a while, through the bitcoin storm since 2017, so I am hesitant to take too seriously more commentary that is premised on some outlandish proclaimations.
No disrespect, but your claims of the G7 crushing bitcoin over the next 12 months is the opposite end of emotional response on the bitcoin spectrum.

Let me say, it works both ways in the bitcoin sphere but from earlier


WolfeTone said:


> Im of the view that the truth lies somewhere in-between.



I don't proclaim that bitcoin will destroy central banks and fiat. I think monetary policy of central banks is capable of doing that by itself.

Bitcoin is not a threat to centralised command banking economies it is a optional alternative solution (best so far) to the application of bad monetary policy, or monetary policy interpreted as such.
I do think it has potential to put some manners on abstract, ideological, goal-shifting, "for the greater good" application of monetary policy makers. 

However I will back up a bit from big picture stuff. A reversion from time to time to Satoshi's bitcoin paper is always useful.
From reading the introduction and proposal it is clear to me that bitcoin has morphed (or morphing into) something that was never envisaged in that paper.
To my mind satoshi did intend that bitcoin be used for purchasing lattes or for small online purchases.

_"Completely non-reversible transactions are not really possible, since financial institutions cannot
avoid mediating disputes. The cost of mediation increases transaction costs, limiting the
minimum practical transaction size and cutting off the possibility for small casual transactions."_


In that regard bitcoin has failed, or failed to date.
I'm of the view that it has failed to date, that is to say I think it still has potential to fulfill that function but there are technological, economic and political factors that need to align for that to occur. When that occurs, if ever, is unknown suffice to say it is reasonable to assume that satoshi did probably envisage it would happen, if not immediately, but within a decade or two at most. 
It is worth noting that on the technological side satoshi is clear that the "_network itself requires minimal structure." _
Bitcoin is not rocket science, and for those of technical capability Im under the impression that the prospect of building on and developing on this network is immense? A lot of this stuff goes over my head but I'm intelligent enough to grasp that those operating in this sphere appear to understand each other and are confident that indeed further development of the network is a real possibility. 

There is too much noise surrounding bitcoins price. This is understandable, but laser-eyes, Musk, G7, Ransomware, Central banks, BOHA, energy use, while not irrelevant are all side lines to the fundamental function of bitcoin;

"_A purely peer-to-peer version of electronic cash would allow online
payments to be sent directly from one party to another without going through a
financial institution."_



letitroll said:


> Stanley Druckenmiller pointed out that it would be highly unusual for a first of its kind of anything to come to dominate a nascent technology space



That's a fair point, but the demise of Alta Vista was not the end of search engines. Search engines just got better. 
So bitcoin is here to stay, it is just a matter of whether it will become #betterbitcoin or not.


----------



## Duke of Marmalade

tecate said:


> fiat isn't a thing of choice - it's use is enforced down the barrel of a gun.


My advice to you is to get out of Dodge, quick.  I now understand your emotional antipathy to fiat and I must remember in future to be more tolerant of the circumstances you find yourself in.


----------



## tecate

Duke of Marmalade said:


> My advice to you is to get out of Dodge, quick.  I now understand your emotional antipathy to fiat and I must remember in future to be more tolerant of the circumstances you find yourself in.


I guess all of these things only become real in the Duchy of Marmalade if they come from an approved Duke of Marmalade source rather than from one of the great unwashed so here goes:

_“fiat currencies have underlying value because men with guns say they do.” _

Mr. Paul 'Fax Machine' Krugman, 2018.


----------



## Duke of Marmalade

@tecate Nice one.  I have dropped Mr Fax Machine from my list of approved sources.

On a more serious note I do not find this argument that you can pay your taxes with fiat very convincing of its intrinsic value.  To me fiat has, let's not call it intrinsic value, but society backing.  That is in the form of debt.  For people to pay off their debts they must earn an economic living i.e. contribute goods and services to society.  So fiat is in this sense an IOU between members of society which will be settled in goods and services.  The threat to this is a collective decision of the indebted not to play ball.  But this is as unlikely as a majority of bitcoin nodes subverting the blockchain.
But there is one debt which is dodgy, I admit.  It is the debt owed by the government.  The ability of the government to honour its debt in goods and services stems from its ability to raise revenues from the economy.  The unprecedentedly easy monetary policy does place this in some doubt.  But IMHO bitcoin is not the answer since, as Satoshi says, it has no intrinsic value. If it had I would fill my boots with it.  That it has network adoption does not cut it for me as intrinsic value.


----------



## WolfeTone

Duke of Marmalade said:


> The threat to this is a collective decision of the indebted not to play ball. But this is as unlikely as a majority of bitcoin nodes subverting the blockchain.



You may have jumped ahead of yourself here Duke. The collective decision of the indebted not to play ball is the extreme end of things. In between society backing (law-abiding, ability to pay) and not playing ball is a lot of festering and increasing inability to pay.


Duke of Marmalade said:


> But there is one debt which is dodgy, I admit. It is the debt owed by the government. The ability of the government to honour its debt in goods and services stems from its ability to raise revenues from the economy. The unprecedentedly easy monetary policy does place this in some doubt.



I'm surprised you don't seem to make the connect between the ability of the government to pay its debts by raising revenues from the economy, and an economy that is not generating enough revenues from which to collect from?


----------



## Duke of Marmalade

@WolfeTone Yes I see dangers, but I will never be convinced that bitcoin or any other crypto without intrinsic value is the solution.

On a separate point I see that bitcoin's current woes are being laid almost entirely at Muskie's doing.  I did caution against the incredible sensitivity this (once) trillion dollar "asset" has to the whims of one man, and a maverick at that.  Hope you resisted the urge to dive in at $60k.


----------



## tecate

Duke of Marmalade said:


> us note I do not find this argument that you can pay your taxes with fiat very convincing of its intrinsic value. To me fiat has, let's not call it intrinsic value, but society backing.


Good - because the former isn't an example of intrinsic value and the latter seems to be something you just thought up.


Duke of Marmalade said:


> @WolfeTone Yes I see dangers, but I will never be convinced that bitcoin or any other crypto without intrinsic value is the solution.


I'd be inclined to think that you'd need to keep more of an open mind on the subject, Duke. As distasteful as the notion is to you, don't you think that potentially you would have to grudgingly accept bitcoin is the real deal lets say if it hits a market cap of $2 trillion?  If not $2 trillion, what's your number?



Duke of Marmalade said:


> On a separate point I see that bitcoin's current woes are being laid almost entirely at Muskie's doing.  I did caution against the incredible sensitivity this (once) trillion dollar "asset" has to the whims of one man, and a maverick at that.  Hope you resisted the urge to dive in at $60k.



Muskies twitter antics are a bit of a nuisance. However, if you dig a bit deeper you'll find that the belief in more credible circles is that the market was well overdue a proper pullback.  Any of the previous pullbacks had been bought up in double quick time.
Otherwise, I agreed with you that a Musk-ism would have an effect on the market BUT only where the Johnny Come Lately's were concerned. Those that have gone the distance in this space didn't sell off on the back of Muskie's mood swing.



			
				Duke of Marmalade said:
			
		

> That is in the form of debt. For people to pay off their debts they must earn an economic living i.e. contribute goods and services to society. So fiat is in this sense an IOU between members of society which will be settled in goods and services.


Encouraging debt slavery is part of the economic system we're running with for sure. I don't see that in anyway as positive for society or the environment.  The notion is we have to keep chasing this elusive growth to keep the musical chairs going - and that means encouraging irresponsible behaviour re. money management. It has the further knock on effect of encouraging people to be the ultimate consumers buying all manner of horrendous crap. This is the source of the environmental issue - ironic given the current tar and feathering bitcoin is (wrongly) getting on the subject.



			
				Duke of Marmalade said:
			
		

> But there is one debt which is dodgy, I admit. It is the debt owed by the government. The ability of the government to honour its debt in goods and services stems from its ability to raise revenues from the economy.


Yeah, that one's not happening. Governments have no notion of paying their debts as we've gone past the point of no return. The system is broken.


----------



## WolfeTone

letitroll said:


> lest you forget the last 150 years aided by fiat money and fractional reserve banking (AND lots of other things of course) has seen the greatest progress in aggregate of human living conditions witnessed since records began.



True, the "lots of other things" being, increased access to education and research and development in science & technology.

But all of that could happen anyway without a fiat system. The fiat system has certainly contributed to a faster rate of progress. Certainly in the last 50yrs. There is no doubt that lots of good has come out of it. But there is no doubt the levels of consumption are unsustainable without solutions to clean energy, pollution, declining biodiversity.

Did anything happen 50yrs ago that could propel this rapid expansion in aggregate human living conditions? Would the reserve currency of the world leaving the gold standard have anything to do with it?



tecate said:


> The notion is we have to keep chasing this elusive growth to keep the musical chairs going - and that means encouraging irresponsible behaviour re. money management. It has the further knock on effect of encouraging people to be the ultimate consumers buying all manner of horrendous crap.



I'm inclined to agree with this. Not so much that people buy horrendous crap, each to their own I say. 
Rather, we consume horrendous crap at an unsustainable rate. Why repair anything when its cheaper to buy new? Why bother save when one new loan can just pay off another loan.


----------



## Duke of Marmalade

tecate said:


> Good - because the former isn't an example of intrinsic value and the latter seems to be something *you just thought up*.


No, quite a long standing theme of mine.  Check your files.


tecate said:


> I'd be inclined to think that you'd need to keep more of an open mind on the subject, Duke. As distasteful as the notion is to you, don't you think that potentially you would have to grudgingly accept bitcoin is the real deal lets say if it hits a market cap of $2 trillion?  If not $2 trillion, what's your number?


When will Stiglitz, Shiller, Krugman, Merton and of course Professor Roubini change their minds?


tecate said:


> Muskies twitter antics are a bit of a nuisance. However, if you dig a bit deeper you'll find that the belief in more credible circles is that the market was well overdue a proper pullback.  Any of the previous pullbacks had been bought up in double quick time.


I would agree that _Wolfie _probably does not qualify as a more credible circle but he was wild bullish at $60k.


tecate said:


> Otherwise, I agreed with you that a Musk-ism would have an effect on the market BUT only where the Johnny Come Lately's were concerned. Those that have gone the distance in this space didn't sell off on the back of Muskie's mood swing.


Rare moment of agreement.


tecate said:


> Encouraging debt slavery is part of the economic system we're running with for sure. I don't see that in anyway as positive for society or the environment. The notion is we have to keep chasing this elusive growth to keep the musical chairs going - and that means encouraging irresponsible behaviour re. money management. It has the further knock on effect of encouraging people to be the ultimate consumers buying all manner of horrendous crap. This is the source of the environmental issue.


That is certainly the gospel according to the cult.


tecate said:


> - ironic given the current tar and feathering bitcoin is (wrongly) getting on the subject.


I'm in the Hands Off Bitcoin brigade on this one.


tecate said:


> Yeah, that one's not happening. Governments have no notion of paying their debts as we've gone past the point of no return. *The system is broken*.


Dream on!


----------



## tecate

Duke of Marmalade said:


> No, quite a long standing theme of mine.  Check your files.



I see it now  - it's filed under unicorns and fluffy rabbits.



Duke of Marmalade said:


> When will Stiglitz, Shiller, Krugman, Merton and of course Professor Roubini change their minds?


That's like a last days of Berlin/Downfall meme then - as the nutty professor has backed himself into a corner and tied himself up in knots. Years later fax machine guy said that he was only joking about the fax machine! Still, maybe Nouriel will be able to dream up something or other.




Duke of Marmalade said:


> I would agree that _Wolfie _probably does not qualify as a more credible circle but he was wild bullish at $60k.


Trying to whip up some discontent, Dukey?  Sorry  but that won't work. Wolfie didn't get out this weekend on the basis of Elon's mood swing. And that's what I was addressing - nothing else.



Duke of Marmalade said:


> That is certainly the gospel according to the cult.


And perhaps you don't see it but spilling out this sort of bile demonstrates that you are part of what you're accusing others of being - the 'in god we trust' cult, right?



Duke of Marmalade said:


> Dream on!


You mean you really believe that the US (and others) are in a position to pay down their debt?  You must be kidding, Dukey.  Of course this is being discussed in crypto circles - but it's being discussed beyond crypto circles also. Post #676  - go and listen to Stanley Druckenmiller. The likes of Ray Dalio - who heads up the World's largest hedge fund has also been shouting from the rooftops to anyone prepared to listen over the course of the past year that the system is broken.


----------



## letitroll

WolfeTone said:


> Did anything happen 50yrs ago that could propel this rapid expansion in aggregate human living conditions? Would the reserve currency of the world leaving the gold standard have anything to do with it?


I kind of don't care how it happened @WolfeTone - the propulsion of billions people out of abject poverty justifies (almost) any end - or as the great pragmatist of the 20th century Deng Xiaoping said - "it doesn't matter whether a cat is black or white, if it catches mice it is a good cat". That single idea propelled a billion plus people out of subsistence farming starvation in China when a small bit of capitalism was sprinkled into the socialist soup.

You should be aware @WolfeTone you seem to sit in the long storied history of monetary Cassandra's - those who see impending doom & collapse in the monetary system both when it was gold backed and when it was not. Some portion of Bitcoiners, are Goldbugs for the modern age......everything old is new again! - it is a powerful narrative that has seduced many - the track record of those in that particular camp over the past 150 years is horrendous but thats not to say 'they' might not be right one day.....yes we've had financial crisis, booms, busts, depression but the robustness of the 'system' and its ability to adapt and reform has been impressive and most importantly the cat has caught mice!


----------



## WolfeTone

Duke of Marmalade said:


> I would agree that _Wolfie _probably does not qualify as a more credible circle but he was wild bullish at $60k.



 Certainly was. But my train of thought at the time was in discussion with yourself and I was working on the basis of the dawning of your brave new world where everyones money would diminish by 2% pa with little incentive to ever hold on to it.
It gave me pause for thought for sure. 
Then I see JB is pumping $trillions into capital infrastructure in US (rather than just bank balance sheets) and I'm thinking this may be a bit of a game-changer. So I am resisting any bitcoin for the moment. Inflation is rearing its head. See how we go. If interest rates rise, I predict a bearish market for bitcoin for a period. I will buy into then. Depending how interest rates are managed by CB's (I'm not confident that anything but another financial calamity awaits) then I can take advantage of the inevitable upside to bitcoin.


----------



## Duke of Marmalade

tecate said:


> Trying to whip up some discontent, Dukey?  Sorry  but that won't work. Wolfie didn't get out this weekend on the basis of Elon's mood swing. *And that's what I was addressing - nothing else.*


You don't think that might be a bit of a porkie?  Or am I misinterpreting the following quote:


			
				tecate in #683 said:
			
		

> However, if you dig a bit deeper you'll find that the belief in more credible circles is that the *market was well overdue a proper pullback. *





tecate said:


> And perhaps you don't see it but *spilling out this sort of bile *


Chill out man.  Your "bile" about my Big Banking Friends etc. just rolls over me.


tecate said:


> You mean you really believe that the US (and others) are in a position to pay down their debt?  You must be kidding, Dukey.  Of course this is being discussed in crypto circles - but it's being discussed beyond crypto circles also. Post #676  - go and listen to Stanley Druckenmiller. The likes of Ray Dalio - who heads up the World's largest hedge fund has also been shouting from the rooftops to anyone prepared to listen over the course of the past year that the system is broken.


I have long learnt to accept that we live in a complex world and best to believe those who are the experts in their field rather than do any armchair theorising.  And whilst you cite some very rare contrarian voices I look to the markets for what the experts really think.  No sign at all that the markets see any risk of default in the debt of the leading nations and there expectations of inflation stealth are also very muted - I accept that with you living in Dodge that might not be very comforting.


----------



## tecate

Duke of Marmalade said:


> You don't think that might be a bit of a porkie?  Or am I misinterpreting the following quote:


I've no notion what you're running with here? It's very simple. I told you that if Elon wobbled the newcomers would wobble. He did and they did. You'd like to stoke up some sort of discord - when there isn't any.  Wolfie had decided to take some profit a few weeks back. Where's the mystery and where's the porkie?



Duke of Marmalade said:


> Chill out man.  Your "bile" about my Big Banking Friends etc. just rolls over me.


Wishful thinking your Dukeness. It's not that it doesn't roll over me - it's that its a false narrative that we hear time and time again - when the zealot is your good self. You try and tar and feather and I'll respond accordingly - simple as that.



Duke of Marmalade said:


> I have long learnt to accept that we live in a complex world and best to believe those who are the experts in their field rather than do any armchair theorising.  And whilst you cite some very rare contrarian voices I look to the markets for what the experts really think.  No sign at all that the markets see any risk of default in the debt of the leading nations and there expectations of inflation stealth are also very muted - I accept that with you living in Dodge that might not be very comforting.


I really can't help you with this - and I don't really care what you want to believe rather than what you're open to understanding. That's an issue for your good self.  I mentioned two well placed individuals in the world of investing/finance - you couldn't get better placed. I also provided you with non-bitcoiner examples (because past performance tells us that you'll scream blue murder if they're crypto folk) - albeit both of them have shown an evolution in their thinking with regard to crypto and bitcoin. 
As regards you saying you look to the markets - what markers are you looking for exactly?  You think that if number go up that necessarily means that all is hunky dory? Could it mean the opposite?


----------



## Duke of Marmalade

tecate said:


> I've no notion what you're running with here?


I think you do but this is one rabbit hole that I am escaping from.


----------



## letitroll

Finite supply.....pull the other one.........get yourself the newly minted.......F*ckElon Token...I'm not joking and either are the people who made it........instructions below for those interested in purchasing. I'm looking at you @WolfeTone  .........with the correct network effects and believe in its store of value I can see a big big future for this one. To the moon, diamond hands etc. etc.


----------



## WolfeTone

letitroll said:


> I kind of don't care how it happened



There is a lot to pack in there, not sure how to respond. 
But I pick up on the reference to golf bug. 
I'm not particularly endeared to gold standard, my fault if I gave that impression. 
I am endeared to a rules based system. I can appreciate the flexibility of the fiat based system, it allows the first world to change all the rules to borrow at record levels at zero interest rates to preserve our status as members of the wealthiest economies in the world. 
What I'm not endeared to is the central planning of this monetary system which, like China, does not allow room for dissent. 
I'm pro-european, pro-single currency, but the construct of this system is very much make it up as you go along with little more than "the greater good" as an underlying philosophy. When the rules change "for the greater good" invariably somebody will have their nose put out of joint, collateral damage I think the Americans call it. 
I just hope it's not me, or my community, or my country. 

Just in case, I have a little bit of bitcoin to preserve some of my wealth in the event that, for whatever reason, it is my nose that is put out of joint.


----------



## WolfeTone

letitroll said:


> I'm looking at you @WolfeTone



My goodness! Are you... are you, _mocking me! _

What happened to Mr.


letitroll said:


> you couldn't tackle any of my points on merit @WolfeTone.......but could only jokingly ridicule,



There was a reason I was somewhat dismissive of your initial G7, GDP proclaimations. 
I was willing to give you benefit of the doubt but notably you haven't backed it up with any reasoning and descended to this malarkey. 
There is another poster that shares your similar views and approach, I hope he is watching


----------



## WolfeTone

Duke of Marmalade said:


> I would agree that _Wolfie _probably does not qualify as a more credible circle




Ha! ha! Duke. I take that in good jest. 

Im here singing the praises of bitcoin because I keep losing money on it!


----------



## letitroll

It was a joke @WolfeTone

I’ve done my logical rebuttals already.

I’m tapping out - my laser eyes need to rest now - I’ll set an alarm for 12 months time and come back and visit……….that’s of course if the very system itself hasn’t collapsed because of money printing and we’re in some Mad Max type hell-scape where petrol is the only true currency left….I bet @Brendan Burgess will still be running this board off a generator in his back garden and I stand ready to go out in search parties to get him the petrol his generator so desperately needs


----------



## WolfeTone

letitroll said:


> It was a joke @WolfeTone



I know. Ditto my "Gamblers are people too!" quip. 

The only reason I am not laughing now is out of fear that if I did, my ribs would crack.


----------



## letitroll

OK I’M BACK - I’m a little divil for this and saw this breaking news TODAY and couldn’t resist:

_China has banned financial institutions and payment companies from providing services related to cryptocurrency transactions, and warned investors against speculative crypto trading.

Under the ban, such institutions, including banks and online payments channels, must not offer clients any service involving cryptocurrency, such as registration, trading, clearing and settlement, three industry bodies said in a joint statement on Tuesday._

https://www.reuters.com/technology/...es-barred-cryptocurrency-business-2021-05-18/

It has begun…nature is healing…....but maybe not….lets see  I’ll admit I was wrong it wasn’t the G7 nations to strike first…..but just the second largest economy in the world and second largest by population………but i was close……you think timing of this is a coincidence @tecate @WolfeTone ? I dont believe in these types of coincidences, do you?

You reduce crime, when you reduce the proceeds FROM crime.

The expected value of any crime is as follows:
the nominal value of the ransom/crime MULTIPLIED by % chance you‘ll get caught = expected value of crime


----------



## tecate

letitroll said:


> OK I’M BACK - I’m a little divil for this and saw this breaking news TODAY and couldn’t resist:
> 
> _China has banned financial institutions and payment companies from providing services related to cryptocurrency transactions, and warned investors against speculative crypto trading.
> 
> Under the ban, such institutions, including banks and online payments channels, must not offer clients any service involving cryptocurrency, such as registration, trading, clearing and settlement, three industry bodies said in a joint statement on Tuesday._
> 
> https://www.reuters.com/technology/...es-barred-cryptocurrency-business-2021-05-18/
> 
> It has begun…nature is healing…....but maybe not….lets see  I’ll admit I was wrong it wasn’t the G7 nations to strike first…..but just the second largest economy in the world and second largest by population………but i was close……you think timing of this is a coincidence @tecate @WolfeTone ? I dont believe in these types of coincidences, do you?
> 
> You reduce crime, when you reduce the proceeds FROM crime.
> 
> The expected value of any crime is as follows:
> the nominal value of the ransom/crime MULTIPLIED by % chance you‘ll get caught = expected value of crime


Here's your answer ->


__ https://twitter.com/i/web/status/1394661559033602049

As I mentioned, there are any amount of regulatory twists and turns over the coming years. However, in no way do I believe that ransomware will be the reason for any of them. There's chatter right now about the big banking lobby in the US trying to get some decisions made by the last administration (which would facilitate crypto custody for small banks)  turned over.

Just to reiterate...the solution to ransomware is network security competence and investigation (you seem to think that the culprits can't be caught - I'm sure it's difficult but it's not impossible). Other than that, banning bitcoin isn't going to fix that problem - i'm confused as to how in the world you think that it would. If anything, it would be driving bitcoin further towards such use cases. The G7 is the G7 - it's not the 110 odd countries on the planet.


----------



## tecate

letitroll said:


> Finite supply.....pull the other one.........get yourself the newly minted.......F*ckElon Token...I'm not joking and either are the people who made it.


Sorry - but that's a comprehension fail. You can start a facebook, twitter or google clone tomorrow - how do you think you'll get on with that?  It's the very same with bitcoin. To unseat it, the challenger will have to be 10x better. You brought up Drukenmiller on the basis that you felt that he suggested that the first project isn't always the one to succeed. Have a look at Business Insider article that covers in detail what he stated and you'll see that he too believes that bitcoin is going to be hard to unseat.


----------



## tecate

Duke of Marmalade said:


> I think you do but this is one rabbit hole that I am escaping from.


The Duke trying to create something out of nothing again, it seems.


----------



## letitroll

tecate said:


> Here's your answer ->
> 
> 
> __ https://twitter.com/i/web/status/1394661559033602049
> 
> As I mentioned, there are any amount of regulatory twists and turns over the coming years. However, in no way do I believe that ransomware will be the reason for any of them. There's chatter right now about the big banking lobby in the US trying to get some decisions made by the last administration (which would facilitate crypto custody for small banks)  turned over.
> 
> Just to reiterate...the solution to ransomware is network security competence and investigation (you seem to think that the culprits can't be caught - I'm sure it's difficult but it's not impossible). Other than that, banning bitcoin isn't going to fix that problem - i'm confused as to how in the world you think that it would. If anything, it would be driving bitcoin further towards such use cases. The G7 is the G7 - it's not the 110 odd countries on the planet.


Sorry @tecate I believe Reuters before I’ll believe a guy who’s pinned tweet at the top of his twitter profile reads:

_“I've honestly never seen a more perfect storm for decentralized technologies.”

Any other sources?_


----------



## tecate

letitroll said:


> Sorry @tecate I believe Reuters before I’ll believe a guy who’s pinned tweet at the top of his twitter profile reads:
> 
> _“I've honestly never seen a more perfect storm for decentralized technologies.”
> 
> Any other sources?_


As in he works in the industry - there's no mystery there. In any event, that's the info I have for you - you can make of it what you will


----------



## Duke of Marmalade

bitcoin has lost over $400bn in a matter of weeks, far surpassing any earlier collapse.  In fact I venture to suggest that this is the most precipitous fall in value of any "asset" in history.


----------



## WolfeTone

Duke of Marmalade said:


> bitcoin has lost over $400bn in a matter of weeks, far surpassing any earlier collapse.  In fact I venture to suggest that this is the most precipitous fall in value of any "asset" in history.



Looks like it. 
Just wait until it calms down and buy up the bargain.


----------



## Duke of Marmalade

WolfeTone said:


> Looks like it.
> Just wait until it calms down and buy up the bargain.


In answer to an earlier question by @tecate I will start to have doubts about my conviction, not based on bitcoin's market cap, but if over a period of about 12 months the volatility of $/BTC is in the same parish as the volatility of $/£ AND at least one of the Nobels starts to crack.  I can't see it happening.
Another little anecdote.  My nephew, a smart millennial cookie with a Masters in Finance, knowing that I have Big Banking Friends, asked me a few weeks ago, I think at $60k,  should he dabble a bit in bitcoin.  I simply emailed him Professor Roubini's views and told him I agreed wholeheartedly. He was gobsmacked and said he wouldn't touch bitcoin after reading that.
There are a couple of takeaways here.  Firstly many people, even smart ones, are easily seduced by the bitcoin hype, they are swayed by this "mining for digital gold by solving complex mathematical equations" and ironically the fact that criminals demand it as ransom underpins its credibility. 
The second takeaway is that they are unaware of the damning dismissal of the whole crypto house of cards by mainstream academia.


----------



## WolfeTone

Duke of Marmalade said:


> but if over a period of about 12 months the volatility of $/BTC is in the same parish as the volatility of $/£ AND at least one of the Nobels starts to crack



Ah, c'mon Duke, we are decade into this BTC thing, you are putting up another arbitrary deadline? For what purpose?



Duke of Marmalade said:


> I simply emailed him Professor Roubini's views and told him I agreed wholeheartedly. He was gobsmacked and said he wouldn't touch bitcoin after reading that.



Of Roubini, my views on his contributions are not too dissimilar to your nephew, with one critical caveat.


WolfeTone said:


> if his was the only information available to me I would have sold out my stock of bitcoin before the end of this sentence. But it is not the only information I have.





Duke of Marmalade said:


> Firstly many people, even smart ones, are easily seduced by the bitcoin hype


Here is a person on Bloomberg today, seems like a smart one. I don't know if he has been seduced or not, but I'm guessing he could hold his own against someone like Roubini. Maybe your nephew would be interested?

Smart person, seduced or no?

Here is his wiki page

Wiki page of some bloke called Kevin Turner



Duke of Marmalade said:


> The second takeaway is that they are unaware of the damning dismissal of the whole crypto house of cards by mainstream academia.



That's quite a claim.


----------



## EmmDee

Duke of Marmalade said:


> bitcoin has lost over $400bn in a matter of weeks, far surpassing any earlier collapse.  In fact I venture to suggest that this is the most precipitous fall in value of any "asset" in history.



"Store of value"?

I accept a lot of the reasons to be supportive of BTC but the weakest one is the "store of value" one - at least until volatility becomes less of a feature of it.


----------



## Duke of Marmalade

EmmDee said:


> "Store of value"?
> 
> I accept a lot of the reasons to be supportive of BTC but the weakest one is the "store of value" one - at least until volatility becomes less of a feature of it.


Give her a break.  She's just a young gal on a price discovery journey.


----------



## tecate

Duke of Marmalade said:


> In answer to an earlier question by @tecate I will start to have doubts about my conviction, not based on bitcoin's market cap, but if over a period of about 12 months the volatility of $/BTC is in the same parish as the volatility of $/£ AND at least one of the Nobels starts to crack.



A bloodbath of March 2020 proportions for sure. However, be aware that previous cycles in 2013 and 2017 included the same price action. We're some years away from bitcoin volatility dying down - so I guess you'll be stuck in that trench for the next few years.


Duke of Marmalade said:


> Firstly many people, even smart ones, are easily seduced by the bitcoin hype, they are swayed by this "mining for digital gold by solving complex mathematical equations" and ironically the fact that criminals demand it as ransom underpins its credibility.


The 'hype' with regard to this phrase you keep quoting is yours! I don't know anyone else who is making a meal out of it, Dukey. And on the second, as has been outlined to you many times, cash is the medium of choice for criminals, big banking facilitates movement of massive amounts of $ through the banking system for organised crime and credit cards and atm networks all fall victim to fraud and theft...but I wouldn't expect anything less from you but to keep on tar and feathering selectively.



Duke of Marmalade said:


> The second takeaway is that they are unaware of the damning dismissal of the whole crypto house of cards by mainstream academia.


And rightly so - they are experts within the workings of Keynesian economics - nothing more. As per your friend fax machine guy, they have no notion of how this form of technological advancement impacts. Furthermore Turkeys don't vote for Christmas. It's like expecting a Christian zealot to turn up at a Mosque. They don't in any way shape or form believe in hard money. How on that basis would there be an expectation that they would give bitcoin their seal of approval? Now if you were to say that Austrian economists don't see the point of bitcoin (given that they do believe in hard money) then that's another story - but that's not what you're running with.



			
				EmmDee said:
			
		

> "Store of value"?
> 
> I accept a lot of the reasons to be supportive of BTC but the weakest one is the "store of value" one - at least until volatility becomes less of a feature of it.


Volatility has to be a part of it - there's no other way for it to develop. Think about it - Satoshi - brings bitcoin out  - and we expect that it's price is finalised from day one? It couldn't possibly work that way. My thesis remains unchanged. Volatility will be a feature for many years to come - albeit on an ever decreasing basis. If you consider bitcoin as a store of value with a low time preference, then you're not going to be happy with the outcome. If you zoom out, it's still acting as a store of value right now (despite todays bloodbath)...ergo if current price was to print as a yearly close, then bitcoin is still up - year on year.



			
				letitroll said:
			
		

> _Any other sources?_



Here you go.


----------



## Sunny

EmmDee said:


> "Store of value"?
> 
> I accept a lot of the reasons to be supportive of BTC but the weakest one is the "store of value" one - at least until volatility becomes less of a feature of it.



Or when someone like Elon Musk no longer has the power to cause > 15% price movements on the back of something he writes on Twitter......


----------



## WolfeTone

Sunny said:


> Or when someone like Elon Musk no longer has the power to cause > 15% price movements on the back of something he writes on Twitter......



Not just bitcoin though. Musk has form with his tweeting and having dramatic impact on prices. 

Musk


----------



## letitroll

Buy the dip and ride rip

Eventually you’ll get your cost basis down to zero and then at that point you literally can’t lose


----------



## Duke of Marmalade

tecate said:


> The 'hype' with regard to this phrase you keep quoting is yours! I don't know anyone else who is making a meal out of it, Dukey.


Maybe he wasn't even aware of the mining and solving equations.  It was clear to me he had given no serious study to it all and yet here he was very tempted possibly out of FOMO.  Maybe the spectacular price rises are themselves the seducer. 


tecate said:


> And on the second, as has been outlined to you many times, cash is the medium of choice for criminals,


I don't make any big deal of the criminal dimension.  But it does get a lot of publicity.  I was pointing out the irony that that could actually underpin the hype.  After all criminals ain't stupid.


tecate said:


> It's like expecting a Christian zealot to turn up at a Mosque. They don't in any way shape or form believe in hard money. How on that basis would there be an expectation that they would give bitcoin their seal of approval?


If ever I needed my term of "cult" justified that is it.  I think you really do see bitcoin as a struggle between two ideologies/cults with on one side my Big Banking Friends.


tecate said:


> Now if you were to say that Austrian economists don't see the point of bitcoin (given that they do believe in hard money) then that's another story - but that's not what you're running with.


What is the view of the Austrian school on crypto?


----------



## WolfeTone

Duke of Marmalade said:


> It was clear to me he had given no serious study to it all and yet here he was very tempted possibly out of FOMO



That thought crossed my mind also. But it actually led to me to be more concerned about Telsa stock. 
How does a company spend $1.5bn on bitcoin without any proper research unless Telsa is managed by a bunch of "Yes-Elon" men and women? 

Not a healthy sign, and as if he was reading the pages of AAM, Michael Burry of The Big Short, has shorted Tesla $530m!


----------



## DublinHead54

letitroll said:


> Buy the dip and ride rip
> 
> Eventually you’ll get your cost basis down to zero and then at that point you literally can’t lose



Buy the Tip sell the Dip


----------



## letitroll

So @tecate @WolfeTone enjoy talking to you both.........your the best of the bitcoin world and I've learned alot about the deep thoughts that underpin the movement.

Help me with this - just given my claim since Colonial Pipeline attack that the powers that be would be coming after Bitcoin hard, I've seen a bunch of stuff that I consider confirming evidence that i was right. That they've agreed with me that all things being equal BTC increases the likelihood of devastating sovereign type attacks by ransomware gangs. Lets look at the timeline:


May 5th Bitcoin is at $58,000
Elon Musk is the poster boy supporter, a global champion. Tesla accepts bitcoin, bitcoin on the balance sheet
May 6th - Colonial Pipeline bitcoin denominated attack happens
Soon after Ireland HSE bitcoin denominated attack 
May 13th -Elon Musk, with 50% of his wealth tied up in a national defense contracting company called SpaceX, does a full 360.Hates Bitcoin. Inconceivable he got a phone call from his US national security pay masters in NASA, NSA, the WH to cut out the Bitcoin bullshit if he wants to keep SpaceX alive?
May 18th - China comes out with three state agencies making a statement.....at worst bans crypto buying & selling through China financial institutions, at best says crypto will never be accepted as payment mechanism and is dangerous. But put crudely the CCP sh!ts all over crpytp
May 19th - Bitcoin is at $36,000
These are either a series of unconnected events..........or I'm a lunatic. Help me find out if I'm a lunatic and what I've been saying about the powers that be cracking down on BTC post-Colonial is wrong. Interested in your thoughts on the above @tecate @WolfeTone ?


----------



## DazedInPontoon

How do these events which you omitted fit in to your theory?

May 17th Musk tweets "To clarify speculation, Tesla has not sold any Bitcoin"
May19th, 30 minutes ago: Musk tweets 'diamond hands' emoji
Why did Tesla not already sell? (or is he lying about this?)

I think people are a) reading too much into his tweets and b) applying to much value to what he or Tesla does.

This too shall pass.


----------



## WolfeTone

letitroll said:


> May 13th -Elon Musk, with 50% of his wealth tied up in a national defense contracting company called SpaceX, does a full 360.Hates Bitcoin.



Although confirms today that Telsa have not sold any of their bitcoin.



letitroll said:


> Inconceivable he got a phone call from his US national security pay masters in NASA, NSA, the WH to cut out the Bitcoin bullshit if he wants to keep SpaceX alive?



Into big global conspiracy theory stuff here,....luvvin' it!   



letitroll said:


> May 18th - China comes out with three state agencies making a statement



Is that May 18th 2021, or 2017?



letitroll said:


> Help me find out if I'm a lunatic and what I've been saying about the powers that be cracking down on BTC post-Colonial is wrong



Sorry, haven't seen much evidence of crackdown.


----------



## DublinHead54

DazedInPontoon said:


> I think people are a) reading too much into his tweets and b) applying to much value to what he or Tesla does.



A few pages back Musks tweets about accepting Bitcoin and announcing Tesla buying bitcoin have been used as supporting evidence of the adoption of BTC. Now we should ignore what Musk is saying? 

It is blatantly obvious that Musks tweets did impact the price, and it has been widely accepted in the community as such. The issue is whether his tweets were accurate and reflective of the truth of Bitcoins energy usage is up for debate.


----------



## DazedInPontoon

From post #157 on 29th January:


DazedInPontoon said:


> Oh yeah, I wouldn't be surprised if he bought bitcoin, or has held some for a long time, or never buys any and is just amused by it, and I wouldn't read much into his twitter to determine what the case is.
> 
> I'm pretty sure in the past he just randomly tweeted "bitcoin" as a one word tweet, and I can only guess he did it for the amusement of seeing what effect he could have on the market by doing so.


I still feel the same - I would not be surprised if they sell some or all of it, or if they buy more.



Dublinbay12 said:


> A few pages back Musks tweets about accepting Bitcoin and announcing Tesla buying bitcoin have been used as supporting evidence of the adoption of BTC. Now we should ignore what Musk is saying?


It is evidence of adoption. I don't find that in contradiction to the fact that people shouldn't hang on his every word or trust him, or care about him much in general.


----------



## Sunny

DazedInPontoon said:


> From post #157 on 29th January:
> 
> 
> 
> It is evidence of adoption. I don't find that in contradiction to the fact that people shouldn't hang on his every word or trust him, or care about him much in general.



So if Tesla sells their Bitcoin stake, that is evidence that it is not being adopted?? You can't it both ways. You can't say 'Look, Tesla are buying all this bitcoin because they believe it is great and shows it is being adopted by the world' and then turn around if they sell saying 'Well who cares what they think'.......

Tesla don't really have a choice but to not sell. If they can't sell before the market spots what they are doing, the value of their holding will collapse. Lets see if Musk and his diamond hands buy more with the sell off. If he believed in it at this price previously, he should believe in it again......

And the idea that this link between one individual or company and bitcoin exists is completely ridiculous and while it is not the fault of bitcoin, it does show the complete nonsense that exists in that space at the moment. The fact that the market got so spooked by what he was doing or might be doing that it led to a 15% sell off shows that you might not care what he thinks, but there of plenty of other people that do........


----------



## DazedInPontoon

Sunny said:


> So if Tesla sells their Bitcoin stake, that is evidence that it is not being adopted??


Yes, if they leave the market for good.

However the fact that one of the biggest (rightly or wrongly) companies in the world used bitcoin as a store of value for a period of time will now always be true. A taboo was broken.


----------



## DazedInPontoon

Sunny said:


> thatt you might not care what he thinks, but there of plenty of other people that do........


Do any of these people still own bitcoin? or have they just sold it all because of Musk?


----------



## tecate

Sunny said:


> Or when someone like Elon Musk no longer has the power to cause > 15% price movements on the back of something he writes on Twitter......


Absolutely - and we will get there eventually. In the meantime, its still indicative of progress and adoption (even if it's not how anyone would want a market to work).


letitroll said:


> Buy the dip and ride rip
> 
> Eventually you’ll get your cost basis down to zero and then at that point you literally can’t lose


Tell me, when a VC backs 100 projects and the majority of them fail, are they wrong to have taken a position in the first instance?


Duke of Marmalade said:


> Maybe he wasn't even aware of the mining and solving equations.  It was clear to me he had given no serious study to it all and yet here he was very tempted possibly out of FOMO.  Maybe the spectacular price rises are themselves the seducer.


These are market cycles surrounding innovation and an adoption curve. You won't change the inherent nature of people. Of course plenty of people have not put any serious study into it. In the bear market, crickets. This thing kicks up and I'm getting calls from people saying is it a good idea - should I bail in, yada yada. Be that as it may, that in no way means that there's nothing of substance here.
And taking this back to your ongoing complaint re. mining and solving equations - that stems for your loathing of the whole notion (because this isn't pragmatic for you Dukey - you want this to fail - simple as that). I haven't seen anyone else complain about this aspect of the whole project.



Duke of Marmalade said:


> I don't make any big deal of the criminal dimension.  But it does get a lot of publicity.  I was pointing out the irony that that could actually underpin the hype.  After all criminals ain't stupid.


Well, you can't have it both ways. You complain about the hype and yet the hype is a distraction and if anything takes away from the rollout and development of crypto. The media hype plays on peoples fear of whats new and ignorance of the topic to big up the illicit use nonsense. That is what you and others have indulged in along the way also. That's what I'm referring to.



Duke of Marmalade said:


> If ever I needed my term of "cult" justified that is it.  I think you really do see bitcoin as a struggle between two ideologies/cults with on one side my Big Banking Friends.


We will never agree and if you're honest with yourself, you'll see that the greater zealot is your good self when it comes to this subject. As above - and as I've pointed out to you many times before  (and as you yourself have confirmed)- this is political and ideological for you - you want it to fail. Zealots  come in all sorts of shapes n sizes (i.e. the 'in god we trust' cult you stem from). It's ill-becoming to be hypocritical on the subject, your Dukeness. 



Duke of Marmalade said:


> What is the view of the Austrian school on crypto?


The Austrian school believe in hard money - not this inequitable QE nonsense.  Bitcoin is hard money.



letitroll said:


> So @tecate @WolfeTone enjoy talking to you both.........your the best of the bitcoin world and I've learned alot about the deep thoughts that underpin the movement.
> 
> Help me with this - just given my claim since Colonial Pipeline attack that the powers that be would be coming after Bitcoin hard, I've seen a bunch of stuff that I consider confirming evidence that i was right. That they've agreed with me that all things being equal BTC increases the likelihood of devastating sovereign type attacks by ransomware gangs. Lets look at the timeline:
> 
> 
> May 5th Bitcoin is at $58,000
> Elon Musk is the poster boy supporter, a global champion. Tesla accepts bitcoin, bitcoin on the balance sheet
> May 6th - Colonial Pipeline bitcoin denominated attack happens
> Soon after Ireland HSE bitcoin denominated attack
> May 13th -Elon Musk, with 50% of his wealth tied up in a national defense contracting company called SpaceX, does a full 360.Hates Bitcoin. Inconceivable he got a phone call from his US national security pay masters in NASA, NSA, the WH to cut out the Bitcoin bullshit if he wants to keep SpaceX alive?
> May 18th - China comes out with three state agencies making a statement.....at worst bans crypto buying & selling through China financial institutions, at best says crypto will never be accepted as payment mechanism and is dangerous. But put crudely the CCP sh!ts all over crpytp
> May 19th - Bitcoin is at $36,000
> These are either a series of unconnected events..........or I'm a lunatic. Help me find out if I'm a lunatic and what I've been saying about the powers that be cracking down on BTC post-Colonial is wrong. Interested in your thoughts on the above @tecate @WolfeTone ?


When market goes up or market goes down, it's important to be wary of the media as they will rush to be the first to publish an underlying reason. They will grab at the first thing they come across - and rush that out - and then it perpetuates itself from there. You can draw your own conclusions - and form your own opinion. It seems that you already have done. Good for you. As I previously outlined, it's not one that I share. 
Remember that whatever our opposing views are, it can only be helpful if I understand what the actual reason for this downturn is - so I've no reason to dismiss your view without thinking it through. I just don't believe this is the one. What I will say is that fear may have set in - in others - who believe the rationale that you set out and I'm sure there was a percentile who may have sold off on that basis. 
I've acknowledged that there are many regulatory twists and turns to come worldwide when it comes to crypto and regulation. We have seen governments flip flop this way and that already - on countless occasions. India is a classic example. Once again, they've banned crypto - and yet, yesterday I'm reading that they're looking at reviewing that decision again. These decisions are not as straightforward as many think.


----------



## tecate

DazedInPontoon said:


> Yes, if they leave the market for good.
> 
> However the fact that one of the biggest (rightly or wrongly) companies in the world used bitcoin as a store of value for a period of time will now always be true. A taboo was broken.


This is precisely the point. This progression is entirely imperfect but it is nonetheless progressing.


----------



## letitroll

Like the spiritual and religious......when you engage in debates.....you find the goalposts constantly change to fit the believe system......I'm over this now FOR SURE.....but below is what I mean:

Religious - "god invented the earth in seven days literally"

Geological record, darwinism appears

Religous - "it was meant only figuratively, jeez were not lunatics"

-------------------------------------------------------------------------------

Bitcoiners - "Musk supporting bitcoin & Tesla accepting bitcoin, changes everything, he's a genius, he lands rockets - this ensures its future adoption and price moves

Musk - says BTC is not fit for purpose

Bitcoiners - "Musk is a side show, he never mattered anyway....were not lunatics


----------



## tecate

letitroll said:


> -------------------------------------------------------------------------------
> 
> Bitcoiners - "Musk supporting bitcoin & Tesla accepting bitcoin, changes everything, he's a genius, he lands rockets - this ensures its future adoption and price moves
> 
> Musk - says BTC is not fit for purpose
> 
> Bitcoiners - "Musk is a side show, he never mattered anyway....were not lunatics


Firstly, you're trying to suggest that everyone who has a position in bitcoin right now holds this view. That is not true - and it's disingenuous to suggest that it is. Musk's involvement has been complicated and the whole episode has been far from perfect. He as an individual it seems is pretty complex - but as has been speculated  - there are all sorts of other factors likely at play in the background - that we don't know the whole story on. 

This wayward mainstream media take on the energy debate may be doing some damage. And it shouldn't because it's shambolic and smacks of double standards.


----------



## Sunny

Well the good news is that it looks like Musk's diamond hands emoji on twitter seems to have stabilised the market......

Who needs Central Bank Intervention to prevent a crisis when Elon Musk and Twitter can achieve the same thing....


----------



## WolfeTone

letitroll said:


> Bitcoiners - "Musk supporting bitcoin & Tesla accepting bitcoin, changes everything, he's a genius, he lands rockets - this ensures its future adoption and price moves





letitroll said:


> Bitcoiners - "Musk is a side show, he never mattered anyway....were not lunatics



@letitroll i don't think you will find a sentiment like that expressed from bitcoiners in these pages. 
I think you just made up that narrative to comfort your own bias. 




Sunny said:


> Who needs Central Bank Intervention to prevent a crisis



Crisis! What crisis?


----------



## Sunny

WolfeTone said:


> Crisis! What crisis?



Ah yes. The world of Bitcoin where a 30% intraday drop before recovering the 30% before dropping another 15-20% is just business as usual! 

Hey, remember the lovely Tesla car that you wanted to buy at 8am this morning that was only going to cost you 1 bitcoin and you took it for a long test drive. Well, sorry the price went up 30% because you took so long. Oh no wait, it will cost you one bitcoin. Let me just get the paperwork. Oh wait, sorry, it is going to cost you 20% more.......


----------



## tecate

Sunny said:


> Well the good news is that it looks like Musk's diamond hands emoji on twitter seems to have stabilised the market......
> 
> Who needs Central Bank Intervention to prevent a crisis when Elon Musk and Twitter can achieve the same thing....


_"Well the good news is that"_ this innovation (and accompanying market) continues to grow and it will continue to mature.


WolfeTone said:


> Crisis! What crisis?


Sunny's not used to this sort of thing - in the conventional markets they halt trading if they're having a bad day.


Sunny said:


> Ah yes. The world of Bitcoin where a 30% intraday drop before recovering the 30% before dropping another 15-20% is just business as usual!
> 
> Hey, remember the lovely Tesla car that you wanted to buy at 8am this morning that was only going to cost you 1 bitcoin and you took it for a long test drive. Well, sorry the price went up 30% because you took so long. Oh no wait, it will cost you one bitcoin. Let me just get the paperwork. Oh wait, sorry, it is going to cost you 20% more.......


And you can't see yourself through to understand that we're talking about the S curve and adoption  - and the accompanying market going through the phases as regards adoption and maturity. Volatility is a bi-product. Gold was as volatile as bitcoin in the 70s but nobody gets upset about that sort of thing strangely enough.


----------



## Duke of Marmalade

WolfeTone said:


> @letitroll i don't think you will find a sentiment like that expressed from bitcoiners in these pages.
> I think you just made up that narrative to *comfort your own bias*.


Now, now, _Wolfie_ you are not playing ball with your mentor who wants to keep _leti _sweet as he is a much more incisive critic of bitcoin than I could ever be.


----------



## tecate

Duke of Marmalade said:


> Now, now, _Wolfie_ you are not playing ball with your mentor who wants to keep _leti _sweet as he is a much more incisive critic of bitcoin than I could ever be.


Feigned humility from his Dukeness. Props to you on that - you know what they say - _fake it 'til you make it_.


----------



## Sunny

tecate said:


> _"Well the good news is that"_ this innovation (and accompanying market) continues to grow and it will continue to mature.
> 
> Sunny's not used to this sort of thing - in the conventional markets they halt trading if they're having a bad day.
> 
> And you can't see yourself through to understand that we're talking about the S curve and adoption  - and the accompanying market going through the phases as regards adoption and maturity. Volatility is a bi-product. Gold was as volatile as bitcoin in the 70s but nobody gets upset about that sort of thing strangely enough.


I don't remember anyone suggesting that gold would be an everyday medium of exchange in the 1970's either like they are doing now with bitcoin so I really have no idea what comparison you are trying to make? 
So are you saying that Bitcoin is a volatile asset like gold was in the 1970's and you are giving up on the medium of exchange bit. It wasn't me that gets all excited when someone announces that they will accept bitcoin for goods. Today just shows how far fetched that is at the moment. 

And I am not aware of time when I was stopped from trading in the currency markets for a major currency because of intra day volatility.......


----------



## tecate

Sunny said:


> I don't remember anyone suggesting that gold would be an everyday medium of exchange in the 1970's either like they are doing now with bitcoin so I really have no idea what comparison you are trying to make?


Well firstly, nobody could suggest gold very well as a medium of exchange in today's world as it fails one of the key requirements (divisibility). You've posted often enough in these threads so clearly you've been following the discussion and participating in it. Therefore, you know perfectly well that bitcoin's current use and more recent advances surround its store of value use case.



Sunny said:


> So are you saying that Bitcoin is a volatile asset like gold was in the 1970's and you are giving up on the medium of exchange bit.


On multiple occasions - over the course of four years - I've acknowledged that bitcoin is challenged in its use as a medium of exchange. Having said that, I believe that those challenges are being over come - and so, that use case is not off the table in any way, shape or form. However, if you want to summarily dismiss bitcoin today - disregarding its potential to evolve (through second layer solutions such as lightning network - through broadening acceptance and over the longer haul, reduced volatility), that's entirely up to yourself. That's not my approach.



Sunny said:


> Today just shows how far fetched that is at the moment.


All it highlights is a major drawback - but it doesn't mean that it can't be used for that purpose. If you hold the asset as a store of value - it's available to spend on a given day - should circumstances arise where it suits you to do so. If you're transferring in real time, it really doesn't matter. 



Sunny said:


> And I am not aware of time when I was stopped from trading in the currency markets for a major currency because of intra day volatility.......


Is there not a mechanism to halt trade in equities markets?


----------



## Duke of Marmalade

Sunny said:


> Ah yes. The world of Bitcoin where a 30% intraday drop before recovering the 30% before dropping another 15-20% is just business as usual!
> 
> Hey, remember the lovely Tesla car that you wanted to buy at 8am this morning that was only going to cost you 1 bitcoin and you took it for a long test drive. Well, sorry the price went up 30% because you took so long. Oh no wait, it will cost you one bitcoin. Let me just get the paperwork. Oh wait, sorry, it is going to cost you 20% more.......


She's on a price discovery journey.  Haven't you been on one of those, perhaps in a theme park on holidays?


----------



## tecate

Duke of Marmalade said:


> She's on a price discovery journey.  Haven't you been on one of those, perhaps in a theme park on holidays?


Meanwhile the price discovery of fiat currency is to lose 99% of its value over its lifetime.


----------



## DublinHead54

Sunny said:


> You can't it both ways. You can't say 'Look, Tesla are buying all this bitcoin because they believe it is great and shows it is being adopted by the world' and then turn around if they sell saying 'Well who cares what they think'.......



That is exactly what has occurred on this thread for 37 pages......

Bitcoin has not been for many years what it was intended for, there is no better proof than the fact the founder walked away. BTC was meant to offer a solution to remove trusted third parts from the payment system, which it does. But it was also meant to be able for the community to run the network peer to peer on the system. Satoshi didn't foresee that the system would be gamed (GPU hacking, ASICs) leading to an arms race in computing power due to the PoW implementation which lead to the Chinese miners entering the market. This is private capital funding mining operations to profit and not borne out of the community itself. 

Due to this mining approach, Bitcoin is no longer decentralized, case in point when the Chinese government reinforce a crackdown (FUD or not) the entire market dropped significantly in the last days (source Tecates tweet a few posts above). 

This is why the community is split between the developers and the miners, each need each other but neither want each other. What started out as a hobby project in a small community is an entirely different beast today. There was never even intended to be exchanges to convert back to Fiat, BTC didn't start out with a $ value, it was only when people joined in asking to buy them because they couldn't mine it themselves that a notional value was added. 

The vast majority of holders have no interest in the origins and are simply looking to make money from it.


----------



## Duke of Marmalade

tecate said:


> Meanwhile the price discovery of fiat currency is to lose 99% of its value over its lifetime.


Fair point.  Although to be fair one should allow for the interest (that the central bank enable) to be earned on fiat cash.  Since 1928 the inflation adjusted return on the dollar has been +0.35%.  There is no equivalent of interest with bitcoin.
But for sure fiat held in your pocket is destined to lose 2% per annum.  At that rate it will have lost 99% of its value in 228 years, as you rightly state.  Even bitcoin enthusiasts admit a non trivial chance that it will go to zero.  I certainly believe it will be zero long before 2250.
Of course the dollar might go to zero, it has happened to other fiat.  However, I would think we would have other things to worry about if the dollar went to zero.


----------



## WolfeTone

Dublinbay12 said:


> BTC was meant to offer a solution to remove trusted third parts from the payment system, which it does.



I don't disagree with a lot what you say.
It is clear bitcoin has morphed into something else that was not envisaged in its whitepaper. Certainly, what is occurring today bares little reflection to what was in satoshis original paper.

But that is hardly unique in history? Take any amount of inventions, discoveries, ideas, and compare them to their original function, concept, design, etc to what they have become.
This is where there is disconnect between bitcoiners and no-bitcoiners. Putting away all the hyperbole (from both sides) it is my view that bitcoiners lean very much to what bitcoin may become or will be of use for, no-bitcoiners are generally stuck in what it is now, it's obvious limitations, with a lot of people in between who cannot make sense of any of it either way.

You only have to go back to satoshi's 8 page whitepaper to see that we are not talking about rocket-science. Nor are we talking about the done-deal here. It is apparent to me that what has occurred is an invention/discovery of digital scarcity that can function in a form as private money.
And as such the debate over what is/is not digital scarcity, what is/is not money (private or otherwise) rages, centering around primarily and understandably so its price action.
It appears to me that bitcoin whitepaper is simply the platform from which a private form of verifiable scarce digital money has been created. This has value. What becomes of it time will tell but I am in no doubt that bitcoin is here to stay, only to be replaced by better technology (which I imagine will be just #betterbitcoin).


----------



## tecate

Duke of Marmalade said:


> Fair point.  Although to be fair one should allow for the interest (that the central bank enable) to be earned on fiat cash.  Since 1928 the inflation adjusted return on the dollar has been +0.35%.  There is no equivalent of interest with bitcoin.
> But for sure fiat held in your pocket is destined to lose 2% per annum.  At that rate it will have lost 99% of its value in 228 years, as you rightly state.  Even bitcoin enthusiasts admit a non trivial chance that it will go to zero.  I certainly believe it will be zero long before 2250.
> Of course the dollar might go to zero, it has happened to other fiat.  However, I would think we would have other things to worry about if the dollar went to zero.


In 228 years? It might be time to swap out that calculator of yours.







Visualizing the Purchasing Power of the Dollar Over the Last Century​


			
				Duke of Marmalade said:
			
		

> There is no equivalent of interest with bitcoin.


Firstly. bitcoin is designed to retain its value over time. Secondly, over and above that, there is a yield curve emerging in crypto. Interest can be earned via crypto lending markets.


----------



## Duke of Marmalade

tecate said:


> In 228 years? It might be time to swap out that calculator of yours.


.98^228=.01;  Calculators do sums, not history and not predicting the future. 


tecate said:


> Firstly. bitcoin is designed to retain its value over time.


Yes and fiat is designed to lose 2% p.a.


tecate said:


> Secondly, there is a yield curve emerging in crypto. Interest can be earned via crypto lending markets.


I was talking about something different.  I was talking about the no risk interest that is provided by the banking system (or at least in normal times).  You are referring to interest payments by borrowers to compensate for the risk of lending.  Not a monster point.


----------



## Duke of Marmalade

Me in another thread on 19th April said:
			
		

> That another crypto usurps bitcoin
> That quantum computing dismantles the elliptic cryptography
> That scalability is not satisfactorily addressed
> That Central Banks act successfully to suppress it
> That Elon Musk gets tired of it and moves on to another toy


This was me a month ago spelling out the risks to bitcoin's store of value.  I didn't expect action on the last two in that list so quickly.  Actually I am surprised at the robustness of the price given the much publicised divorce from Muskie.


----------



## DublinHead54

WolfeTone said:


> I don't disagree with a lot what you say.
> It is clear bitcoin has morphed into something else that was not envisaged in its whitepaper. Certainly, what is occurring today bares little reflection to what was in satoshis original paper.
> 
> But that is hardly unique in history? Take any amount of inventions, discoveries, ideas, and compare them to their original function, concept, design, etc to what they have become.
> This is where there is disconnect between bitcoiners and no-bitcoiners. Putting away all the hyperbole (from both sides) it is my view that bitcoiners lean very much to what bitcoin may become or will be of use for, no-bitcoiners are generally stuck in what it is now, it's obvious limitations, with a lot of people in between who cannot make sense of any of it either way.
> 
> You only have to go back to satoshi's 8 page whitepaper to see that we are not talking about rocket-science. Nor are we talking about the done-deal here. It is apparent to me that what has occurred is an invention/discovery of digital scarcity that can function in a form as private money.
> And as such the debate over what is/is not digital scarcity, what is/is not money (private or otherwise) rages, centering around primarily and understandably so its price action.
> It appears to me that bitcoin whitepaper is simply the platform from which a private form of verifiable scarce digital money has been created. This has value. What becomes of it time will tell but I am in no doubt that bitcoin is here to stay, only to be replaced by better technology (which I imagine will be just #betterbitcoin).



My stance is just that BTC is not the be all end all some protest it is.

Even Satoshis whitepaper was an amalgamation of preexisting technologies (p2p, hashing etc), in a clever way that solved the double spend issue without a 3rd part maintaining a central ledger.

Better Bitcoin may be a CBDC or it might just be regular cash. The question becomes will the average person trust an algorithm or a central bank? Bitcoin is even beginning to not be the main focus of the community. Look at below as an example. 





__





						r/Bitcoin - As a moderator for /r/cryptocurrency... What I see is starting to bother me.
					

3,376 votes and 1,417 comments so far on Reddit




					www.reddit.com


----------



## tecate

Duke of Marmalade said:


> .98^228=.01;  Calculators do sums, not history and not predicting the future.


Then your 2% figure is an underestimation based on history - as the graphic above demonstrates.



Duke of Marmalade said:


> Yes and fiat is designed to lose 2% p.a.


That's incorrect. Monetary policy is  set by your CB high priests - we have no idea what tinkering they will do from one moment to the next. Bitcoin's monetary policy is hard coded in - and transparent.  We know what it is right now and what it will be 50 years from now.



Duke of Marmalade said:


> I was talking about something different.  I was talking about the no risk interest that is provided by the banking system (or at least in normal times).  You are referring to interest payments by borrowers to compensate for the risk of lending.  Not a monster point.


How so no risk?


Duke of Marmalade said:


> This was me a month ago spelling out the risks to bitcoin's store of value.  I didn't expect action on the last two in that list so quickly.  Actually I am surprised at the robustness of the price given the much publicised divorce from Muskie.


Your expectations were accurate as none of the items on your list have come to fruition.


----------



## DublinHead54

tecate said:


> Firstly. bitcoin is designed to retain its value over time. Secondly, over and above that, there is a yield curve emerging in crypto. Interest can be earned via crypto lending markets.



This is a rehashing of the current financial market, to part take in crypto lending markets you need to trust a 3rd party like BlockFi and deposit BTC with them. BlockFi is not without its own issue (Link), and of course we all remember what happened with Mt.Gox.


----------



## Duke of Marmalade

tecate said:


> Then your 2% figure is an underestimation based on history - as the graphic above demonstrates.


Rather than try and decipher one of the cult's Sacred Picture I sourced the following figures:
Rather than try and decipher the numbers from the cult's Sacred Pictures I sourced the following:


			
				Inflationdata.com said:
			
		

> Total inflation from January 1914
> to April 2021 is 2,570.54%
> $100 after inflation is $2,670.54


This translates as 3.1% p.a.  At this rate it will take 150 years to fall 99%.  Definitely prepared to predict that bitcoin's price will be zero before 150 years are up.


----------



## tecate

Duke of Marmalade said:


> Rather than try and decipher one of the cult's Sacred Pictures, I sourced the following:


I'm sure HowMuch.net's dollar bill graphic was upsetting to you and your CB high priests seeing as the 'In God We Trust' has been torn away off of it.

As regards the rest of your response, if there's interest to be earned on fiat there's risk in the same way as there is in crypto lending. And just to head your next point off, deposit insurance costs have to be built in somewhere.


----------



## Sunny

tecate said:


> I'm sure HowMuch.net's dollar bill graphic was upsetting to you and your CB high priests seeing as the 'In God We Trust' has been torn away off of it.
> 
> As regards the rest of your response, if there's interest to be earned on fiat there's risk in the same way as there is in crypto lending. And just to head your next point off, deposit insurance costs have to be built in somewhere.



You seem to have an issue with 'in God we trust' as you brought it up before...you know it is just a motto dont you. They could put 'in Bitcoin we trust' and it would still mean nothing and have nothing to do with how something is valued...

You seem to be resorting to arguing design features at this stage......


----------



## tecate

Sunny said:


> You seem to be resorting to arguing design features at this stage......


We're a little selective in our criticism, aren't we? 

Would it be fair to say that it's a religious statement? Taking that a step further, what's the difference between a religion and  a cult?

So long as his Dukeness persists with the cult jibes, I'll direct attention at the real cult. The engagement of many on the subject is not borne out of pragmatism but cultish behaviour....as the Duke himself exemplifies when he tells us he's worried about the expansive money printing but that he has blind faith in the CB high priests to muddle through.


----------



## Duke of Marmalade

> From Wiki:





> In the English-speaking world, the term _cult_ often carries derogatory connotations.  In this sense, it has been considered a subjective term, used as an _ad hominem_ attack against groups with differing doctrines or practices.  As such, religion scholar Megan Goodwin defined the term _cult_, when it is used by the layperson, as often being shorthand for a "religion I don't like."


I suppose that does sum up my use of the term in the context of ideological believers in bitcoin, of which I would think @tecate proudly identifies himself.  If that is his belief then it follows that he has the same view of my trust in the monetary order that Western society in particular has so successfully developed.  
@tecate sees it as analogous to Christians vs Muslims which I suppose explains his focus on the caption on the back of the greenback, but I would like to assure him that that caption is not relevant to my trust in the system.  I would think that if there is a god she would find it somewhat presumptuous that we would expect her to get involved in the operation of mammon.


----------



## tecate

Duke of Marmalade said:


> I suppose that does sum up my use of the term in the context of ideological believers in bitcoin.


Time for some self reflection, Dukey. Let me highlight  a particularly poignant part of wiki's explanation:
_"the term cult often carries* derogatory connotations*. In this sense, it has been considered a subjective term, *used as an ad hominem attack* against groups"_
That's it right there.



Duke of Marmalade said:


> of which I would think @tecate proudly identifies himself.


Current 'believer' insofar as I've repeatedly stated that I accept that bitcoin could still fail; and I've repeatedly acknowledged bitcoin's shortcomings. Many here can't be objective enough to acknowledge a single redeeming feature of bitcoin (including yourself) - so it's a bit rich to go on with this 'cult' nonsense.



Duke of Marmalade said:


> If that is his belief then it follows that he has the same view of my trust in the monetary order that Western society in particular has so successfully developed.



There is a very important distinction. Bitcoin was developed in consideration of the need NOT to trust the existing system - in addressing or providing an alternative to - its failings. The mantra in crypto circles is 'don't trust, verify'.  Compare that with your stance - where you explicitly told us that you were concerned about CB monetary expansion but that you'd simply have to place blind faith in CB'ers. Which of these two approaches is more akin to cult-like behaviour?



Duke of Marmalade said:


> @tecate sees it as analogous to Christians vs Muslims which I suppose explains his focus on the caption on the back of the greenback, but I would like to assure him that that caption is not relevant to my trust in the system.


Religion -> Cult .  There is no difference. You are a devout believer in the conventional monetary system where its leading fiat currency is peppered with religious and cult-like symbolism. So I suppose the original CB'ers thought - these are worthless pieces of cotton - what sort of nonsense can we stick on these notes to convince the huddled masses that they have some sort of value.

You insist on the disingenuous taring and feathering - and so, I'll call you out on it. Or you can be reasonable and drop it - but I don't mind either way - on we go.


----------



## Duke of Marmalade

tecate said:


> Current 'believer' insofar as I've repeatedly stated that I accept that bitcoin could still fail; and I've repeatedly acknowledged bitcoin's shortcomings.


By ideology I am not referring to its technical achievement of Satoshi's relatively modest ambitions as an alternative currency.  I am referring to the whole Libertarian thing; bankers are bad; can't trust the elite; make a break for freedom etc.


tecate said:


> Many here can't be objective enough to acknowledge a single redeeming feature of bitcoin (including yourself) - so it's a bit rich to go on with this 'cult' nonsense.


I have stated that if bitcoin had intrinsic value I would fill my boots with it.


			
				tecate said:
			
		

> _"the term cult often carries* derogatory connotations*. In this sense, it has been considered a subjective term, *used as an ad hominem attack* against groups"_


Oh, you give as good as you get.  Big Banking friends?


----------



## WolfeTone

Dublinbay12 said:


> My stance is just that BTC is not the be all end all some protest it is.



That's my stance also. I think the concept of bitcoin is brilliant. Private money whose value, issuance, etc is not determined by a centralised authority of bankers who decide how much, when, where and what the rules are, and when those rules are applicable or not applicable, when those rules can be changed or when they cannot be changed.

Don't get me wrong, such a system can have enormous benefits. But having the option to step outside that system is a brilliant concept. The option to dissent is critical for the development and advancement of humankind.



Dublinbay12 said:


> Better Bitcoin may be a CBDC or it might just be regular cash.



CBDC or regular cash cannot be #betterbitcoin.


----------



## tecate

Duke of Marmalade said:


> By ideology I am not referring to its technical achievement of Satoshi's relatively modest ambitions as an alternative currency.  I am referring to the whole Libertarian thing; bankers are bad; can't trust the elite; make a break for freedom etc.


That changes nothing relative to your 'cult' tarring and feathering. Having said that, I'll add that stakeholder groups relative to bitcoin are many and varied at this stage.



Duke of Marmalade said:


> I have stated that if bitcoin had intrinsic value I would fill my boots with it.


I recall going through a series of endless discussion where you couldn't/wouldn't bring yourself to acknowledge a single positive characteristic of bitcoin - culminating in the above - which is a 'it would be great if it wasn't so crap' statement. 



Duke of Marmalade said:


> Oh, you give as good as you get.  Big Banking friends?



Absolutely - if those are the rules of the game. 



			
				WolfeTone said:
			
		

> CBDC or regular cash cannot be #betterbitcoin.


Agree completely, Wolfie. They offer different options to people but in no way are they the same thing.


----------



## tecate

Opinions on crypto and bitcoin keep evolving. These comments from David Rubenstein of The Carlyle Group are relevant given that some believe that crypto will just be shut down:


__ https://twitter.com/i/web/status/1395354887966412801


----------



## presidenttttt

One issue in these debates is the entanglement of 3 things; protest or mistrust against current system, crypto and block chain as a technology, and BTC. The first two can also be large factors in assessing values of other current or future coins. Some arguments or attitudes seem to see BTC as the only game in town, and therefore "to the moon". If only markets, investments, gambling were that simple....


----------



## tecate

presidenttttt said:


> Some arguments or attitudes seem to see BTC as the only game in town, and therefore "to the moon". If only markets, investments, gambling were that simple....


If you'd like to discuss another crypto/coin/Blockchain project I'd imagine you can open up another thread. If it's a project you think that challenges or has the potential to challenge bitcoin, by all means introduce it to the discussion.


----------



## letitroll

US Treasury wants cryptocurrency transfers over $10,000 to be reported to the IRS​








						US Treasury wants cryptocurrency transfers over $10,000 to be reported to the IRS
					

It’s part of a larger proposal of new rules for tax enforcement.




					www.theverge.com
				




_"The agency says cryptocurrency ‘*facilitates illegal activity broadly *including tax evasion" 
“Cryptocurrency already poses a significant detection problem by facilitating illegal activity broadly including tax evasion,”_

Like I said.......the powers that be, agree with me......who.....just the US Treasury.....i.e. the White House......the CCP & China's leadership......next move is European regulatory authorities / commission to do something BTC hostile in response to Colonial/Ireland bitcoin denominated attack.......Europe is a little slower to get things done my guess is next week or week after something drops.......as I've said previously this all occurring a couple of weeks after Colonial....weird, so weird......


----------



## DublinHead54

WolfeTone said:


> That's my stance also. I think the concept of bitcoin is brilliant. Private money whose value, issuance, etc is not determined by a centralised authority of bankers who decide how much, when, where and what the rules are, and when those rules are applicable or not applicable, when those rules can be changed or when they cannot be changed.
> 
> Don't get me wrong, such a system can have enormous benefits. But having the option to step outside that system is a brilliant concept. The option to dissent is critical for the development and advancement of humankind.
> 
> 
> 
> CBDC or regular cash cannot be #betterbitcoin.



Bitcoin is controlled by a handful of people. It is an open source piece of computer code. It is therefore possible that at some point in future the developers can decide to change the amount of coins issued. 

Bitcoin is not exempt from human interventions and ideology just like real money. Hence why we've seen disagreements and hard forks (,Litecoin, Bitcoin Cash etc). These are all forks of the original bitcoin led by early adopters / developers of bitcoin.


----------



## presidenttttt

Isn’t that stance a bit close minded, ironic from a “community” imploring people to be open minded? Sort of like the thing that happens in a bubble.

The ultimate leader may not even be widely known or created yet. 


tecate said:


> If you'd like to discuss another crypto/coin/Blockchain project I'd imagine you can open up another thread. If it's a project you think that challenges or has the potential to challenge bitcoin, by all means introduce it to the discussion.


----------



## WolfeTone

Dublinbay12 said:


> It is therefore possible that at some point in future the developers can decide to change the amount of coins issued.



That's not my understanding, and you are the first person I have heard to say that. 
I think its theoretically possible to change the amount of coins issued, but as i understand it is near impossible in reality. 
If it were a viable option to change the amount to be issued its standing would be shot to pieces in an instant and it would be end of bitcoin. 



Dublinbay12 said:


> Bitcoin is not exempt from human interventions and ideology just like real money. Hence why we've seen disagreements and hard forks (,Litecoin, Bitcoin Cash etc). These are all forks of the original bitcoin led by early adopters / developers of bitcoin.



I get all that, but none of that is changing bitcoin. It's just taking bitcoin and trying to create #betterbitcoin with little success. 
It doesn't actually change bitcoin itself.


----------



## letitroll

letitroll said:


> US Treasury wants cryptocurrency transfers over $10,000 to be reported to the IRS​
> 
> 
> 
> 
> 
> 
> 
> 
> US Treasury wants cryptocurrency transfers over $10,000 to be reported to the IRS
> 
> 
> It’s part of a larger proposal of new rules for tax enforcement.
> 
> 
> 
> 
> www.theverge.com
> 
> 
> 
> 
> 
> _"The agency says cryptocurrency ‘*facilitates illegal activity broadly *including tax evasion"
> “Cryptocurrency already poses a significant detection problem by facilitating illegal activity broadly including tax evasion,”_
> 
> Like I said.......the powers that be, agree with me......who.....just the US Treasury.....i.e. the White House......the CCP & China's leadership......next move is European regulatory authorities / commission to do something BTC hostile in response to Colonial/Ireland bitcoin denominated attack.......Europe is a little slower to get things done my guess is next week or week after something drops.......as I've said previously this all occurring a couple of weeks after Colonial....weird, so weird......


Thoughts on this @tecate @WolfeTone 

One of these everyday at this stage - it’s as if the bear has been awoken


----------



## WolfeTone

letitroll said:


> One of these everyday at this stage - it’s as if the bear has been awoken



No issue with that. It suggests authorities are wanting/aiming to bring the crypto sector into compliance. This is a good thing imo. 
I have no issue with being tax compliant. 

It is far cry from 'crushing' bitcoin.


----------



## DazedInPontoon

Dublinbay12 said:


> Bitcoin is controlled by a handful of people. It is an open source piece of computer code. It is therefore possible that at some point in future the developers can decide to change the amount of coins issued.


This is flat out wrong. The code is public, open source and licensed in a way that anyone is free to change it and redistribute it. This means anyone can make *their own* changes to the code, they can decide to run the code with those changes and they can release it for other people to run.

However, no one can force anyone to run any particular code changes. The 'official' bitcoin code repository and the set of core developers who work on it have no actual power to compel people to run their code. Users (meaning users, miners, nodes and exchanges etc) run their code by choice not because they're forced to.

If the current core developers decided to change the code in a way that the users did not like, such as increasing the coin issuance, the users would react by not running code that included that change.



Dublinbay12 said:


> Bitcoin is not exempt from human interventions and ideology just like real money. Hence why we've seen disagreements and hard forks (,Litecoin, Bitcoin Cash etc). These are all forks of the original bitcoin led by early adopters / developers of bitcoin.


There are two kind of forks here.

Litcoin was based on a copy of the bitcoin code, but did not fork the bitcoin blockchain - LItecoin has a completely new blockchain separate from Bitcoin.

Bitcoin Cash is both a fork of the code and the blockchain. This is what happens when everyone doesn't agree on code changes. If the core developers really controlled the code the fork would not be possible - everyone would have been forced to run a singular bitcoin. Obviously it would be better for everyone if there was consensus among everyone about what code changes were best and forks never happened, but it is critical that forking is always an option - it's required to keep the devs honest.


----------



## DazedInPontoon

Following on from that

Rugby Union is bitcoin core, Rugby League is bitcoin cash. American Football is Litecoin.

You can say the RFU control rubgy, but they cannot determine how you play with your friends in the park. They cannot stop someone else from creating a fork of Rubgy with different rules - they can only say that if you do so you will no longer be compatible with rugby union.


----------



## Duke of Marmalade

DazedInPontoon said:


> Following on from that
> 
> Rugby Union is bitcoin core, Rugby League is bitcoin cash. American Football is Litecoin.
> 
> You can say the RFU control rubgy, but they cannot determine how you play with your friends in the park. They cannot stop someone else from creating a fork of Rubgy with different rules - they can only say that if you do so you will no longer be compatible with rugby union.


Interesting analogy.  RFU can of course change the number of points for a try, for example.
Is it possible for the number of bitcoins  to be increased?  My read of what you are saying is that it is possible but would not be in the overall interests of the "community" or network or whatever it is called, and therefore would be rejected by said network.


----------



## DazedInPontoon

Duke of Marmalade said:


> Interesting analogy.  RFU can of course change the number of points for a try, for example.


Only for those who agree to 'run their code'. You can play with your friends and choose as many points as you like for a try. Rugby League can decide on a different number of points.

But ultimately if the RFU decided to make the ball round, or some other decision which the vast majority of users did not like, the following things may happen:
 * users agree even though they don't like it
 * users disagree and stop attending games entirely
 * users disagree and switch to attending rugby league games or an entirely new rugby association and league is started (as happened with Rubgy League)
 * users disagree and the RFU staff get replaced due to revolts from the whole ecosystem - fans, players, team owners etc.

My point is that the power the RFU has is at the discretion of the users.

Look at the football super league for an example of how the owners don't have the power that some would say they do. The power lies with the economic majority.


----------



## DazedInPontoon

Duke of Marmalade said:


> My read of what you are saying is that it is possible but would not be in the overall interests of the "community" or network or whatever it is called, and therefore would be rejected by said network.


yes


----------



## WolfeTone

DazedInPontoon said:


> Look at the football super league for an example of how the owners don't have the power that some would say they do. The power lies with the economic majority.



Yes, and to further emphasis the power of the community (or the disempowerment of any one central authority), say in a parallel universe, it was the football supporters marching on the stadiums across Europe demanding the initiation of the Super League as proposed. 
This would take a gargantuan effort that in theory was possible but realistically next to zero ever happening.


----------



## DazedInPontoon

I would love to have seen what would have happened if the Super League went ahead. I wonder if the fans and existing clubs could have fought it enough to make it fail.


----------



## tecate

letitroll said:


> Like I said.......the powers that be, agree with me......who.....just the US Treasury.....i.e. the White House......the CCP & China's leadership......next move is European regulatory authorities / commission to do something BTC hostile in response to Colonial/Ireland bitcoin denominated attack.......Europe is a little slower to get things done my guess is next week or week after something drops.......as I've said previously this all occurring a couple of weeks after Colonial....weird, so weird.....
> Thoughts on this @tecate @WolfeTone
> 
> One of these everyday at this stage - it’s as if the bear has been awoken


My thoughts on this remain unchanged. Lets recap on what my thoughts were....i.e. that over the course of the next few years there will be plenty of twists and turns with regard to regulation. On the bits you put in supersize font, we've covered that already. Everyone acknowledges that inherent in the decentralised nature of bitcoin is the ability to move funds around more freely.  This is what we're here for - and the facility can be used for good and for bad. Therefore, the guy that wrote the report isn't necessarily wrong. In the same way as he wouldn't be wrong in saying cars facilitate bank robbers to execute a bank robbery. The difference is that your claim is that there isn't sufficient upside with bitcoin/crypto for society and government to tolerate it. I vehemently disagree - so rather than go round in circles, we'll have to accept that disagreement and see how things develop.
The measure you identify suggests that Uncle Sam wants his share of the $ (tax). Surprise surprise.  This is what regulation will focus on - governments making sure they get their cut. Not an outright ban. Flipping back to the ransomware stuff, you seem to be fixated on that for some reason. I'll grant you that the Colonial affair was infrastructural so there's that. As regards the HSE, that's a complete nothing burger. In as much as you want an outright ban on crypto on the back of that alone - today - when I think of this - I would want people to realise where the issue lies and go after that i.e. an organisation that is totally mismanaged and incompetent.
You believe that a couple of measures are a knee jerk response to that. That's not an opinion I share.  The news out of China was a reiteration of measures that were in place a couple of years ago already. And this coming out of the US - is a small piece in a regulatory jigsaw that is being put together. Regulation didn't become a theme because of ransomware. If you don't believe me, then do an advanced google search on "regulation" + "crypto" OR "bitcoin" and only include results to a timeframe before these two ransomware attacks. I can assure you there's been all sorts of noise in that regard. It's an ongoing consideration - as it always is when it comes to innovation which moves much faster than regulators.



presidenttttt said:


> Isn’t that stance a bit close minded, ironic from a “community” imploring people to be open minded?


I'm having difficulty in understanding what your grievance is here. You bemoaned the fact that a thread that specifically discusses bitcoin (see thread title) specifically discusses bitcoin?  Beyond that, I suggested that if it was a project related to a money or store of value use case, have at it - introduce it to the discussion.
Explain to me how that is close minded???




			
				presidentttt said:
			
		

> The ultimate leader may not even be widely known or created yet.


I don't know at what point you started to follow these discussions but it's something that has been considered many times - and as recently as the last few days. If you are suggesting that bitcoin may be usurped, then my position (which I've stated a  gazillion times over the course of 4 years here) is that yes it could. I'm open to the potential of bitcoin failing on the basis of that and other rationale.
On the flipside, whenever anyone has suggested that bitcoin could be upended by another project, naturally enough I ask by what project and we get crickets. I also liken it to Facebook/Google/Twitter, etc. they can all be upended too - but it will have to be by something that is 10x better.



DazedInPontoon said:


> This is flat out wrong. The code is public, open source and licensed in a way that anyone is free to change it and redistribute it. This means anyone can make *their own* changes to the code, they can decide to run the code with those changes and they can release it for other people to run.


Many misunderstand the dynamic with regard to the various stakeholder groups relative to bitcoin. In the blocksize war, miners tried to impose their will over and above other stakeholder groups. Users disagreed and on that basis, miners never got their way. This is something which is also misunderstood when the degree of decentralisation (or otherwise) of bitcoin mining is considered.
China-based miners want to take control of the network? Firstly, it remains to be seen that they can be rounded up so easily but lets assume that they can. Billions are spent on that attack and the net result is that users fork the network away. Would there have been disruption to the network? Definitely. Would bitcoin have been taken out as a consequence? No way - and in fact, the project would end up being much stronger for the experience. In which case, why would anyone go there in the first instance and be shown up as idiots (not to mention all the time, money and resources expended).
The same applies re. any perceived belief that a group of developers have control of the project. I can't imagine a scenario where anyone would ever dare touch the 21 million BTC hardcap. Doing so is akin to committing suicide. But even in some bizarre twist where that somehow plays out, users can fork away. It's the peoples network - not the miners or that of an elite band of developers, etc.


----------



## letitroll

__ https://twitter.com/i/web/status/1395683698859814912


----------



## WolfeTone

letitroll said:


> __ https://twitter.com/i/web/status/1395683698859814912



I have a question. What are these criminals going to do with their bitcoin and crypto after extorting it from their victims?


----------



## tecate

@letitroll :  So you found a kindred spirit. That doesn't surprise me in the least. Its the very same as the wayward energy debate and other aspects of discussion on crypto and bitcoin.  If someone approaches the debate with the central premise at the outset that they see no value in it - then of course they will come to these wayward conclusions. This is an example of a guy who holds exactly the same opinion on the subject as your good self - but no more than that.

Having said that, he already confirmed that there are other ways - through gift cards etc. So this will go on regardless of whether bitcoin exists or not. Even if there is NO means for them to extort $, it will still happen. As we all well know, hackers hack for kicks, for the challenge, for the bragging rights.  Just in case you're thinking that's bs - are you telling me that prior to the first crypto-based ransomware attack, there was no such thing as hacking or rasomware?

Lastly, let me humour you for a second and run with the notion that, yeah you're right - it's all bitcoin's fault. And lets say the G7 ban it. What next? You will NEVER get all of the 110 + jurisdictions in the world to ban bitcoin.  What you might do is drive it further into this use case. And at that point, I would wager that its even less likely that the perpetrators are apprehended in such instances.

So....in that kneejerk response, you will have killed off the wave of innovation that's coming with bitcoin and decentralised crypto (and whilst you've dismissed that in the case of bitcoin, I'd imagine you haven't even begun to think it through for the raft of other decentralised crypto projects that are ongoing for totally different use cases (but who's tokens still have value and could be utilised as a medium for such attacks). You'll kill it off for the countries that enforce such a ban but not for those that don't.  That's why I said that I really doubt that a complete ban is coming.

I do believe that there will be back and forth with regulation - some of it will be progressive and some of it will be stone age - and they will flip n flop as they don't know how to deal with it (and that's been the experience up until now as they have been learning that they can't deal with it as easily as you're thinking).

For what it's worth, here's an interview with Ross Stevens of NYDIG - which may provide you with an idea of how this whole thing is likely to unfold as we move forward.


----------



## WolfeTone

Crypto regulation

Here is another article that mentions all the relevant regulatory authorities . While the dangers of illicit activities are mentioned the tone is of regulating, not banning.


----------



## letitroll

You've forgotten my equation already....the authorities havent:

the expected value/return of a crime is a function of the probability of escape multiplied by the nominal $ value of the crime lets call it maybe something like this:

$ of Crime ($C) x Probability of Escape (PoE) = Expected Value of Crime (EVC)

Bitcoin/Crpyto increases the PoE.....it therefore increases EVC.....which in turn increases crime itself.....its been most notable in the ransomware segment.........indeed the tweet I linked to spoke about an intentionally randomized wallet Tornado that was made to hide identity perfectly

@tecate @WolfeTone - can I get you both on the record on this one on a very simple point...........

(1) Is your supposition that Bitcoin/Crypto has ZERO incremental benefit in the masking of identify, as compared to cash/bank wires in the pursuit of crimes? Please answer.


----------



## tecate

letitroll said:


> You've forgotten my equation already....the authorities havent:


You mentioned your 'formula'. But you're formula is meaningless. You have zero in the benefits column when it comes to decentralised crypto (your buddy mentioned Ethereum by the way - not btc - to my point in my last post). That's wayward (and we'll continue to disagree until the whole thing unfolds). Secondly, you never addressed what I put to you.  You're requesting that all decentralised crypto be banned post haste - yet that won't make a jot of difference to the rasomware problem - as the G7 banning bitcoin doesn't meant that it's not traded in other jurisdictions and that it doesn't continue to be used for ransomware.  I contend that not only will it continue to be used - but that the extent to which it is used for that purpose (and purposes like it) - will increase. How is this a positive outcome?




letitroll said:


> (1) Is your supposition that Bitcoin/Crypto has ZERO incremental benefit in the masking of identify, as compared to cash/bank wires in the pursuit of crimes? Please answer.


You mention cash - cash is the medium of exchange of choice when it comes to criminal enterprise and it's far less traceable than bitcoin.   With regard to your question, It has already been answered in post #773 ->


> Everyone acknowledges that inherent in the decentralised nature of bitcoin is the ability to move funds around more freely. This is what we're here for - and the facility can be used for good and for bad.



Your 'solution' to the ransomware issue is the equivalent of dropping the A bomb - with no upside. You're proposing it on the wayward notion that there is no innovation here. And this would be done for what? As crypto will still be used as the medium of choice for ransomware attacks after any such ban.


----------



## letitroll

OK thanks - you've confirmed what everyone knows - its a better widget for crime/ransomware

I've stated the benefit profile looks pretty sh!tty to me.....even after your extensive attempts (which I admired, they were logical and reasoned and came from experience)......but not enough to sway me.....I consider cryptos positives modest.......and its negatives immense

and every day this week the authorities back me up - todays news:
China Hammers Bitcoin Anew With Warning on Miner Crackdown​




__





						Bloomberg - Are you a robot?
					





					www.bloomberg.com


----------



## tecate

letitroll said:


> OK thanks - you've confirmed what everyone knows - its a better widget for crime/ransomware


You're re-hashing what was already discussed. Bitcoin is a tool and it could be utilised for good or for bad.  In the same way as cash is or a car could be used in the course of criminal activity,...and  a gazillion other things.



letitroll said:


> I've stated the benefit profile looks pretty sh!tty to me.....even after your extensive attempts (which I admired, they were logical and reasoned and came from experience)......but not enough to sway me.....I consider cryptos positives modest.......and its negatives immense


That's your opinion - and you're free to hold it. As I mentioned a couple of days ago already - we won't find agreement on that point in any way shape or form - and so we can park that up in disagreement.



letitroll said:


> and every day this week the authorities back me up - todays news:



I'm unsure how long you've taken an interest in crypto but from day 1 - there have been negative headlines - it's par for the course at this stage. Countries have banned crypto - then unbanned it - then banned it again. And all the while, it keeps growing and developing.

If you can't answer my question, then maybe you can ask 'the authorities' to answer it.  ...i.e. how does the G7 banning bitcoin/crypto fix the ransomware issue?


----------



## letitroll

tecate said:


> If you can't answer my question, then maybe you can ask 'the authorities' to answer it.  ...i.e. how does the G7 banning bitcoin/crypto fix the ransomware issue?


Ban/cripple/hamper whatever......they simply need to make it hugely crippling painful to use and useless for crime & gambling......on ramps / off ramps shut down for crime proceeds..........taxes on crypto gains to put on foot with other assets

The value of crypto and its adoption to date.........has blinded folks like yourself @tecate i think who have a kind of utopian view of whats happening in this space really..........its endearing but ultimately your naive on how puss filed this space really is............my supposition is once the gamblers and criminals leave or are forced out of the network.........the true underlying economic/societal value that underpins 'the BTC network' is very low.......the gamblers, speculators and criminals abandon it......and BTC is back to a couple of bucks a coin.........I believe the experiment is being run right now and we'll find out in time


----------



## Duke of Marmalade

@tecate that interview (love in) with Ross Stevens was truly gut wrenching, I could only stomach 40 mins of it.
Don't tell me this isn't a cult.  RS is into bitcoin because of growing inequality, it will help the poor man.  It will give personal sovereignty.  He quotes a new saint for the cult, some indy driver that refuses to be sponsored by fizzy drinks companies or oil companies, he wants to drive for  bitcoin "for the good of humanity", no less.  However he is not from the fundamentalist wing, he does not believe that central bankers are the anti christ - no they "mean well", they just can't help their upbringing - he makes this point with "humility and empathy" (Lord forgive them, they know not what they do).

Here are just a few snippets of his nonsense.
Bitcoin is not volatile.  Why? because anyone is free to use it as their Unit of Account in which case it would be the dollar that is volatile.
He used to think that there was a real chance of bitcoin going to zero.  That is now no longer possible so we have a hugely asymmetrical risk - no chance of zero and no cap to the upside.  This does not apply to other crypto which still have a chance to go to zero.
Bitcoin is consistent with Darwin's theory of evolution as it enables reproduction.  I'm serious folks, even the sycophantic interviewer had to take two at that.
Gold has not a limited supply, if its price went to $100k the miners would come out in their masses and increase the supply.  He asks the interviewer was he aware that bitcoin was totally limited in supply as revealing the third secret of Fatima.
Within a year he sees widespread demand from folk to have at least some of their wages and pensions paid in bitcoin.


----------



## tecate

letitroll said:


> Ban/cripple/hamper whatever......they simply need to make it hugely crippling painful to use and useless for crime & gambling......on ramps / off ramps shut down for crime proceeds..........taxes on crypto gains to put on foot with other assets


That's completely and utterly unrealistic.  It would have to be shutdown in EVERY nation on the planet - every last one - with no exceptions. You have not thought this through - and more alarmingly, you're prepared to trample over innovation along the way.  We talk about bitcoin - it's just one project - this measure  that you're proposing would include all decentralised crypto projects -and all the use cases that they are being developed to serve. 


letitroll said:


> The value of crypto and its adoption to date.........has blinded folks like yourself @tecate i think who have a kind of utopian view of whats happening in this space really..........its endearing but ultimately your naive on how puss filed this space really is............my supposition is once the gamblers and criminals leave or are forced out of the network.........the true underlying economic/societal value that underpins 'the BTC network' is very low.......the gamblers, speculators and criminals abandon it......and BTC is back to a couple of bucks a coin.........I believe the experiment is being run right now and we'll find out in time


So you've already said and I vehemently disagree with your appraisal. I suggest we park it up there.


----------



## tecate

Duke of Marmalade said:


> @tecate that interview (love in) with Ross Stevens was truly gut wrenching, I could only stomach 40 mins of it.



For sure - it must have been incredibly painful watching for someone who has been diametrically opposed to bitcoin/decentralised crypto before he even approached said discussion 4 years ago. Somewhere within that discussion was mention of a 'beginners mind' - that's not something you bring your dukeness.



Duke of Marmalade said:


> Don't tell me this isn't a cult.


You can't help yourself, Duke....from the guy who told us that his plan is to have blind faith in central bankers and hope they can figure things out on that basis. The 'In God We Trust' cult.



Duke of Marmalade said:


> Bitcoin is not volatile.  Why? because anyone is free to use it as their Unit of Account in which case it would be the dollar that is volatile.


FIAT currency has been purposefully and willfully debased since the time of the Romans (when they paired away gold / silver from the coins). In the past 12 months, many of the central bank high priests behind the leading fiat currencies have magic'ed up more $ than  has been issued over the course of decades - combined. Are you also a holocaust denier because that's in this territory.



Duke of Marmalade said:


> Gold has not a limited supply, if its price went to $100k the miners would come out in their masses and increase the supply.


Once again - the Duke tries to defy proven logic. Bitcoin is perfectly finite.  Gold is not. If the cost of gold goes up, then mining becomes more lucrative. If a gold prospect isn't viable today, it may become viable tomorrow should the price go up.  We saw this play out with oil - with fracking technology having been developed as a direct consequence - resulting in far more oil being exploited today. If the price of bitcoin goes up, there is no way to extend the supply. Only a prejudiced crank would try to deny that.

All the same old stuff from the guy that when challenged to put the price of a couple of pints at risk on a wager re. bitcoin once again exceeding $20,000, all we heard was crickets. That's the level / strength of conviction you have in this nonsense.


----------



## letitroll

tecate said:


> That's completely and utterly unrealistic. It would have to be shutdown in EVERY nation on the planet - every last one - with no exceptions. You have not thought this through - and more alarmingly, you're prepared to trample over innovation along the way. We talk about bitcoin - it's just one project - this measure that you're proposing would include all decentralised crypto projects -and all the use cases that they are being developed to serve.


Never said it had to be or will be shut down in every country - i AGREE that is unrealistic...........it simply will be choked off......the same way company ownership secrecy is choked off to a couple of backwater tax haven islands these days.....even the Swiss were pressured and driven out of their bank secrecy position by the G7 who saw its externalities for society......this movie has been played before.........take a look at the market cap of Credit Suisse .......to see what happens when a significant portion of your users/customers were scumbags and criminals leveraging your superior widget for the proceeds of crime.........the same faith awaits BTC / crypto equivalents.....99% fall in value from BTC's all time high is my bear case


----------



## WolfeTone

letitroll said:


> (1) Is your supposition that Bitcoin/Crypto has ZERO incremental benefit in the masking of identify, as compared to cash/bank wires in the pursuit of crimes? Please answer.



I honestly do not know as I have never used it for pursuit of crimes. 
My gut instinct is that it has zero (or at worst, next to zero) incremental benefit from cash (bank wire, yes) for hiding identity. 
Let me elaborate. 
I'm of the view that the primary motivator of involving oneself in criminal activity is to enrich oneself (EVC). 
But as your twitter feed informs us "... ransomware is the only usecase for crypto..." 

So what is the point of illicit activity obtaining bitcoin or any other crypto if you cannot lavish yourself in the EVC? 

The ONLY benefit for illicit activity is to convert the ill-gotten goods into $$ - otherwise it is a pointless exercise. This is the same for most illegally obtained, held or stolen goods where the underlying motive is the ESV- bicycles, cars, household goods, dogs, heroin, cocaine etc. 
The aim is to move the 'hot' goods into convertible cash to enjoy the trappings of wealth this criminal activity promises. 
It may be possible that you have a cash buyer for your bitcoin, but that just demonstrates the equality between bitcoin and cash for identity masking. 

The other way ( I accept there may be other ways due to my lack of expertise in crime) is to transfer your bitcoin into a REGULATED exchange, say Coinbase. 
And as authorises introduce more regulation then the question of how you came upon such an amount of bitcoin may need to be answered - in the same way as if you lodged a large amount of cash into your account and are asked to prove the means of that lodgement. 



letitroll said:


> and every day this week the authorities back me up



How long so before bitcoin is crushed?


----------



## tecate

letitroll said:


> Never said it had to be or will be shut down in every country - i AGREE that is unrealistic...........it simply will be choked off......the same way company ownership secrecy is choked off to a couple of backwater tax haven islands these days


Then you understand that in no way shape or form will banning bitcoin/decentralised crypto have the desired effect that you started out with i.e. preventing it being used by those that carry out ransomware.



letitroll said:


> the same way company ownership secrecy is choked off to a couple of backwater tax haven islands these days.....even the Swiss were pressured and driven out of their bank secrecy position by the G7 who saw its externalities for society......this movie has been played before.........take a look at the market cap of Credit Suisse .......to see what happens when a significant portion of your users/customers were scumbags and criminals leveraging your superior widget for the proceeds of crime..


You have not in any way thought this through. First of all, you're talking about a moving target. As regards the countries that it may be traded out of, how on earth do you think that the US or whomever is going to bring that about? Lets say you drive it to failed states - then what?  The US are going to fix all those failed states?



letitroll said:


> 99% fall in value from BTC's all time high is my bear case


I expect an 80% fall from all time high this cycle  on the basis that we still have not arrived at that all time high yet.  However, my expectation is that this innovation continues to develop - just like it has done in previous cycles. Price action is price action. It does serve some purpose in reeling in new entrants into the eco-system. However, developers get their best work done during bear markets and it's building out the  tech and eco-system that is of far greater importance.


----------



## WolfeTone

letitroll said:


> .......take a look at the market cap of Credit Suisse .......to see what happens when a significant portion of your users/customers were scumbags and criminals leveraging your superior widget for the proceeds of crime.........the same faith awaits BTC / crypto equivalents.....99% fall in value from BTC's all time high is my bear case



What you seem to be suggesting is that authorities will drive out the illicit activity in crypto?
This is a GOOD thing for crypto, it only enhances its reputational status amongst the vastly greater law-abiding public. 
Arguably, the negative headlines and unsubstantiated claims of vast criminal activity for bitcoin is suppressing its adoption by many.


----------



## WolfeTone

letitroll said:


> ........take a look at the market cap of Credit Suisse



Just another point about this. Credit Suisse and the wider banking cartel are organisations involved in illicit criminal activity using cash balances as the means. 
Cash, bitcoin, poppy plant, coca, hemp, dogs, bicycles, whatever... have never been the problem. 
It's what people do with them is the problem. 
If authorities 'crush' illicit activity in bitcoin then expect its price to soar.


----------



## Duke of Marmalade

tecate said:


> For sure - it must have been incredibly painful watching for someone who has been diametrically opposed to bitcoin/decentralised crypto before he even approached said discussion 4 years ago. Somewhere within that discussion was mention of a 'beginners mind' - that's not something you bring your dukeness.
> 
> 
> You can't help yourself, Duke....from the guy who told us that his plan is to have blind faith in central bankers and hope they can figure things out on that basis. The 'In God We Trust' cult.
> 
> 
> FIAT currency has been purposefully and willfully debased since the time of the Romans (when they paired away gold / silver from the coins). In the past 12 months, many of the central bank high priests behind the leading fiat currencies have magic'ed up more $ than  has been issued over the course of decades - combined. Are you also a holocaust denier because that's in this territory.
> 
> 
> Once again - the Duke tries to defy proven logic. Bitcoin is perfectly finite.  Gold is not. If the cost of gold goes up, then mining becomes more lucrative. If a gold prospect isn't viable today, it may become viable tomorrow should the price go up.  We saw this play out with oil - with fracking technology having been developed as a direct consequence - resulting in far more oil being exploited today. If the price of bitcoin goes up, there is no way to extend the supply. Only a prejudiced crank would try to deny that.
> 
> All the same old stuff from the guy that when challenged to put the price of a couple of pints at risk on a wager re. bitcoin once again exceeding $20,000, all we heard was crickets. That's the level / strength of conviction you have in this nonsense.


Well you didn't previously in this thread entirely agree with your new hero.  You have admitted that bitcoin is volatile (down 11% today)  something to do with a voyage of price discovery, I think you explained (please don't ask me to source).  Ross states that bitcoin is not volatile, it is the dollar which is volatile.  Have you changed your mind and now agree with the guru?
Do you agree with him that within a year there will be widespread demand for at least part of wages and pensions to be paid in bitcoin?
Can you explain (and do you agree ) that bitcoin will support Darwin's requirement for reproduction?  Even the sycophantic interviewer baulked at that.
Try and separate your answers from attacks on me, which of course I do not in any way resent, but they are a distraction.


----------



## DazedInPontoon

A single exchange like Coinbase has 56+ million customers, institutions hold at least 56 billion dollars worth of bitcoin and people still think it's just some kind of underground criminal tool.

(56 must be number of the day)


----------



## tecate

Duke of Marmalade said:


> Well you didn't previously in this thread entirely agree with your new hero.  You have admitted that bitcoin is volatile (down 11% today)  something to do with a voyage of price discovery, I think you explained.  Ross states that bitcoin is not volatile, it is the dollar which is volatile.  Have you changed your mind and now agree with the guru?


You seem to be struggling with comprehension difficulties so let me help you out. Stevens is saying that if the measure is going to be a conversion from btc to fiat, then given that we've established that fiat has and continues to be debased since the time of the Romans, then of course there will be volatility.


----------



## Duke of Marmalade

tecate said:


> You seem to be struggling with comprehension difficulties so let me help you out. Stevens is saying that if the measure is going to be a conversion from btc to fiat, then given that we've established that fiat has and continues to be debased since the time of the Romans, then of course there will be volatility.


You didn't answer my questions.  I answer yours.  Good night (possibly not in Dodge).


----------



## tecate

Duke of Marmalade said:


> You didn't answer my questions.  I answer yours.  Good night (possibly not in Dodge).


I didn't - because knowing your past form on this subject area, I knew that there was a high likelihood that he didn't say what you claim or in the way that you claim.  And sure enough, once again Duke you fail to disappoint.  Are you so entrenched in your views that you can't help yourself?

This is what he actually said...


From 15:35 onwards ...he states:

_"The most important trades we make are the trades we make with our future self. We all have a *Darwinian* propulsion towards holding the soundest money possible."_
He goes on to say that its instinctive that people don't want to end up with something valueless (i.e. a currency that NOBODY can deny is being continually debased) as it's a threat to our survival. He likens that instinct to the other primal instincts we have as humans.

You twisted that into something that Goebbels or Chemical Ali couldn't possibly match.

On enabling people to buy/obtain bitcoin...He said that his company has partnered with Fortune 500 company FIS - who in turn will enable banking app functionality - such that it will be much easier for consumers to buy and sell bitcoin through the app offered by their current bank. That means that as retail banks offer this functionality, ordinary people feel more secure in purchasing through an organisation they've been banking with already. They're already KYC'ed which is huge as one of the issues holding crypto back in recent years has been the friction involved with people having to go to the trouble of opening up separate crypto exchange accounts with entities that they're not familiar with/don't trust - and with interfaces that are intimidating (as they're built for traders rather than your ordinary Joe).

On retail bank credit cards, the option to receive rewards in BTC will be enabled. There are already two startups in the rewards space that offer rewards in BTC ( fold.app & Lolli ) and they've been doing really well - it's an area that's expected to grow rapidly.
On the timeframe for these developments, he stated that nothing happens fast in banking but his expectation is that the first banks to do this will do so in 2022.

In the insurance business, he foresees a scenario where the consumer will be given the option to elect to receive 10% of their monthly annuity in bitcoin. He then  foresees a scenario in the future where employees can elect to receive 5 or 10% of their salaries in bitcoin. In terms of timeframe, all of that he says is coming in the next 12 to 24 months. That's what he _actually_ said.

Do I believe that this will happen within that timeframe?  We already know that banks are gearing up to offer bitcoin. If he means that the first signs of that will show up in the next 12-24 months, then that seems entirely plausible. Bear in mind that my expectation would be that such an eventuality would start with progressive tech companies in the US.


----------



## WolfeTone

US inflation, reasons to be worried

Here is one for the CB cultists. The language in this says it all. But due to the life-long indoctrination, the faith, it passes for reasoned logical comment.
Not so much the commentator himself but rather the comments from CB.

In case you hit a paywall;

"_It would be fair to conclude that inflation expectations are moving up. But, at current levels, they will not concern the Federal Reserve all that much..."
- _Well, that's ok then. As long as CB is not concerned then there is nothing for anyone to be concerned about?

_"... as Jay Powell, Fed chair, said last August, “we will seek to achieve inflation that averages 2 per cent over time. Therefore, following periods when inflation has been running below 2 per cent, appropriate monetary policy will probably aim to achieve inflation moderately above 2 per cent for some time.” _

What is he talking about? What does "averages over 2 per cent over time " mean? How much time is he talking about?

"_Therefore, following periods when inflation has been running below 2 per cent, appropriate monetary policy will probably aim to achieve inflation moderately above 2 per cent for some time.” _

So how long has this period of inflation to last? What is 'moderately above 2%'?

Here we go:

"_Because inflation has fallen short of the goal by a cumulative total of 5 percentage points since 2007, this could justify, say, 3 per cent inflation for five years, before a return to 2 per cent." _

So having failed to reach a 2% target on average over the last 14yrs (average was 1.65%, or 17% short of the target on average, every year, for 14yrs) it is now suggested that a 3% would be sustainable for 5yrs before returning to 2% (the target that has not sustained for 14yrs).

Perhaps I'm being a little harsh? Perhaps an average of 1.65% instead of average of 2% over 14yrs isn't such a bad result considering the innumerable variables of an economy so big?
On the face of it probably not, not to the faithful anyway. But are there any other factors worth considering? The commentator highlights four factors of concern. This is the most significant.

"_The government and substantial swaths of the private sector have huge debt liabilities and borrowing plans." _

So while CB's were celebrating and congratulating themselves on 'managing' inflation, that inflation was being exported as debt onto the balance sheets of sovereign, corporate and individuals disproportionately boosting asset prices.

Speaking of volatility, it is said here that the depreciation of US$ is 2% pa over the long term.

Somewhere between 20-25% of all US dollars circulating were printed into existence were in 2020.
In order to sustain an average 3% inflation rate over next 5yrs, CPI basket of goods will have to near double in price in that period.

Good luck 'managing' that (average) 3% inflation rate target.


----------



## tecate

WolfeTone said:


> US inflation, reasons to be worried
> 
> Here is one for the CB cultists. The language in this says it all. But due to the life-long indoctrination, the faith, it passes for reasoned logical comment.
> Not so much the commentator him but rather the comments from CB.


These last two sentences from the article you quoted from, Wolfie:

_" It is hard to believe these emergency monetary policies should continue for years, as many at the Fed think. I doubt whether they should continue even now."_

There's no doubt but that this monetary expansion has assisted the crypto price upswing. In crypto circles, the notion of the central bank high priests tapering off the magic money is being considered as a threat to this bull run. However, many believe that they simply won't be able to. They tried that after the last financial crisis and quickly did a u-turn. We're in the age of free money and universal basic income (UBI).


----------



## Duke of Marmalade

@WolfeTone
I am addressing you here as @tecate is in pure denial mode.  This is what his latest bitcoin evangelist actually said.


			
				“Ross Stevens” said:
			
		

> We have a Darwinian propulsion to want sound money.  Think of it with unsound money we have no food, no shelter, no mate, no reproduction.


The interviewer sums up this theory by observing that “reproduction is important”.
I kid you not _Wolfie_.
I ask @tecate does he agree with this Darwinian theory, and he calls me Goebbels/Chemical Ali.  Sure sign he is squirming.

There were a number of points where I agreed with the prophet.
_Bitcoin is worthless of itself, its only value is as a medium of future exchange
Other cryptos have a very real chance of going to zero
Central bankers are well intentioned._


----------



## WolfeTone

Duke of Marmalade said:


> The interviewer sums up this theory by observing that “reproduction is important”.
> I kid you not _Wolfie_.



Yes I watched it. It was in the context of philosophising about money. What it is and what it does. He wasn't specifically referring to bitcoin with the exception  of describing it as hard money (something that holds its value over time) being of greater value than soft money (that what loses value over time). Bitcoin is hard money.

In a modern context, in Ireland and other developed economies, no food, shelter, mate, reproduction, is manifesting itself in unaffordable housing prices, extortionate rents, negative interest rates on deposits, subdued wages increases, reduced family size, delayed family planning.
"Slumming it", the "long commute", living in digs etc, is no longer the preserve of the 20-somethings, it is firmly embedded into a significant portion of the 30-something population. That portion of the population who had realistic expectations of starting families etc are being put on the long-finger. Instead they are living at home sustaining the pension fund of mum for longer and longer.
By themselves, or even with a partner, they cannot sustain an affordable independent lifestyle that puts food on the table, providing shelter and starting a family.

CSO Average age of mothers


----------



## Duke of Marmalade

WolfeTone said:


> Yes I watched it. It was in the context of philosophising about money. What it is and what it does. He wasn't specifically referring to bitcoin with the exception  of describing it as hard money (something that holds its value over time) being of greater value than soft money (that what loses value over time). Bitcoin is hard money.
> 
> In a modern context, in Ireland and other developed economies, no food, shelter, mate, reproduction, is manifesting itself in unaffordable housing prices, extortionate rents, negative interest rates on deposits, subdued wages increases, reduced family size, delayed family planning.
> "Slumming it", the "long commute", living in digs etc, is no longer the preserve of the 20-somethings, it is firmly embedded into a significant portion of the 30-something population. That portion of the population who had realistic expectations of starting families etc are being put on the long-finger. Instead they are living at home sustaining the pension fund of mum for longer and longer.
> By themselves, or even with a partner, they cannot sustain an affordable independent lifestyle that puts food on the table, providing shelter and starting a family.
> 
> CSO Average age of mothers


Another heroic try _Wolfie_.  Believe me if bitcoin was the mainstream currency of choice we would be in a far far worse condition.  We have learnt that a fixed money supply is not fit for purpose (meeting the needs of technology driven superfast growing economies) just as we have learnt that the horse is not fit to be the transport of choice.
On Ross Stevens, he is quite clear that it is bitcoin which he adulates, he is actually scathing of other cryptos.
I am not downplaying the social problems you allude to though maybe I will have a try.  Compared to almost any previous period in history they are modest.  I am thinking Ireland in the 1920s, 1930s, 1940s, 1950s, 1960s, 1970s, 1980s.  Now in the 90s/00s we did seem to go into hyperdrive but that looks like an illusion with hindsight and yes it was partly fuelled by the monetary phenomenon of low euro interest rates.
If you believe that all those previous periods would have been ones of economic bliss, or even better than they were, if only we had a fixed money supply, well I can't prove you are wrong, but I profoundly believe that to be the case.


----------



## WolfeTone

Duke of Marmalade said:


> We have learnt that a fixed money supply is not fit for purpose



I'm not disputing this. This is why I dont advocate that bitcoin will replace central banks.
I do think it has potential to put manners on central banks.
I accept the fluidity of the fiat system has many benefits, but let's not get bogged down in the advancement of humankind since the dawn of time most of a which a central bank was neither here nor there.

The crux of the issue, as I see it, is the operation of a _sound_ monetary system. The system, as it operates, is commandeered by central authorities and a banking cartel.
The bond market and the stock market long being revered as the signalling mechanism to central authorities of any particular fiscal or Monetary policy applied.
Joe soap public would just go with the flow, hoping to be on the right side of policy decisions implemented for the "greater good" or "well intended" as Ross mentions. And in this part of the world we can say with confidence that we have, in the main, been served well.
But as the saying goes, past performance is no guarantee of future returns... and in the quest to deliver in the name of the greater good it would be wrong not to acknowledge that there have been casualties as a consequence of policy decisions implemented by central authorities. At an extreme end, the rise of fascism in Europe in 1930's is testament to that.
But where is the option to dissent at an individual level? Where is the option to decide that the central policies of tax, or interest rates, are not reflective of the actual events that any particular individual, anywhere, is experiencing.

 A critical element of any developing economy and society.


----------



## Duke of Marmalade

Ok _Wolfie _you have called a truce in the bunfight with that reasoned post.
I mean it when I say that if bitcoin had intrinsic value I would probably have most of what I currently have in savings certs and prize bonds in bitcoin.*  My central objection is Roubinist and Nobelist - bitcoin is *not *a currency.
As a thought experiment what if it was a valid alternative currency?  I think it would be a serious impediment to mainstream monetary policy and in the (perceived) interests of society the authorities would be forced to act.
Possibly we are getting to the stage where there is enough "adoption" to make it act as a currency at least for its network.  Maybe that should be a concern but I don't think it is nearly so far along that road as to threaten mainstream monetary policy.
The issue of criminal utility is a separate one which I am trying to stay out of it as it only gives @tecate the excuse to accuse me of persecuting the cult.

_* Reflecting more on that, I wonder what intrinsic value I would trust.  I don't have any gold investments.  I suppose I have in mind something that is guaranteed to keep pace with general inflation and yet again I am not invested in inflation linked bonds._


----------



## WolfeTone

Duke of Marmalade said:


> bitcoin is *not *a currency.



It's neither a 'coin', but we are now back into the world of metaphors. I personally think Roubini is too hung up on this.
I think the adoption of terminology such as 'digital gold' is reflective of how Bitcoin has morphed (-ing) into something that was probably never envisaged. I don't think the word 'gold' is mentioned in satoshis whitepaper?



Duke of Marmalade said:


> As a thought experiment what if it was a valid alternative currency? I think it would be a serious impediment to mainstream monetary policy and in the (perceived) interests of society the authorities would be forced to act.



I referred to this before. In a sound monetary system, bitcoin has little chance of ever being a valid alternative currency.

Bitcoin is a creature of an unsound monetary system, or the what some people perceive as an unsound monetary system.
I have some cash balances, losing 2% a year. Maybe a little more with bank charges and stamp duty etc.
But I limit cash balances and excesses can be used bitcoin or if Im endeared to a particular stock.
With the exception of a very short period of time in bitcoin’s life cycle, namely the period from Feb 2021 to today, anyone who has bought any bitcoin, at any other time since it was first available has seen a positive return, or would have a positive return if they didn't sell it since.
And when you step outside the hyperbole of ransomware, laser-eyes, FUD, boiling oceans, etc, that is an impressive stat for something that is not a corporation and not a central authority.


----------



## tecate

Duke of Marmalade said:


> @WolfeTone
> I am addressing you here as @tecate is in pure denial mode.  This is what his latest bitcoin evangelist actually said.
> 
> The interviewer sums up this theory by observing that “reproduction is important”.
> I kid you not _Wolfie_.
> I ask @tecate does he agree with this Darwinian theory, and he calls me Goebbels/Chemical Ali.  Sure sign he is squirming.


I've sent on a link to your last few posts to @FoxNews - I'd expect you should hear from one of their recruiters imminently. You reckon that you've quoted Stevens yet why have you run one sentence into another - skipping the two sentences in between - and trying to remove context and in so doing misrepresent Stevens and with that, trying to discredit him?  I wonder why you feel you need to go to those lengths....

Whatever it is, I guess it must be for the same reason you insist on the prejudicial and inflammatory descriptives i.e. 'hero', 'guru', 'evangelist' and 'prophet'. Alongside a whole host of other stakeholders in the sector, he's worth hearing out. That's where it ends.



Duke of Marmalade said:


> There were a number of points where I agreed with the prophet.
> _Bitcoin is worthless of itself, its only value is as a medium of future exchange
> Central bankers are well intentioned._


@FoxNews - when you read this, you should know that you have a standout prospect here. Look at the ease with which he takes these items out of context - seamlessly. Lets go through them.
Bitcoin is worthless of itself he says -> Stevens said that ANY medium of exchange is worthless of itself - that they're all just a means through which we buy the goods and services we want in life.
Central bankers are well intentioned ->  but of course Dukey takes the statement out of context. The word 'but' came next - and following the 'but' was Stevens' view that Central Bankers are getting it wrong.
In summary, @FoxNews, it remains to be seen if the Duke has the same 'face for television' as Tucker Carlson but on the basis of the above, just imagine what he can do with an Alexandria Occasia-Cortez speech.


----------



## Duke of Marmalade

tecate said:


> Central bankers are well intentioned ->  but of course Dukey takes the statement out of context.


What a brass neck?  Do you remember shouting from the rooftops that Professor Roubini had used the term "store of value".   That was seriously out of context.
My reference to Stevens view of central bankers highlights a big rift in the cult between those (like yourself) who think that central bankers are the anti christ and those who in "humility and empathy" understand that they simply can't help their upbringing.


----------



## tecate

Duke of Marmalade said:


> Believe me if bitcoin was the mainstream currency of choice we would be in a far far worse condition.


I know you have deep-seated insecurities on this but nobody here is suggesting a complete swap out from fiat to bitcoin. What is being proposed is offering choice to people. You want to deny them that choice.



Duke of Marmalade said:


> We have learnt that a fixed money supply is not fit for purpose (meeting the needs of technology driven superfast growing economies) j


It's interesting that you cite the notion of 'meeting the needs of technology-driven superfast growing economies'. Technology is driving us towards a deflationary future - and this Keynesian model of driving people into debt - driving them further into rampant consumerism and in the process destroying the planet - all to fuel the growth that this model demands - isn't going to be able to keep up with it.



Duke of Marmalade said:


> If you believe that all those previous periods would have been ones of economic bliss, or even better than they were, if only we had a fixed money supply, well I can't prove you are wrong, but I profoundly believe that to be the case.


I don't know enough about it - it's something I want to put some time into learning more about. Bitcoin gets criticised in terms of being deflationary - whilst looking back at the experience of the gold standard. I don't know if it's as simple as that - as bitcoin brings something else to the table with a programmatic monetary system that everyone knows from the outset and nobody can mess with. Otherwise, as I pointed out above, we are heading towards a changing environment - a deflationary environment over the longer run due to tech moving forward at pace. My understanding is that this keynesian driven fiat approach isn't going to be able to overcome that - and so, we will have to find a way of adjusting to a deflationary environment anyway.


Duke of Marmalade said:


> As a thought experiment what if it was a valid alternative currency?  I think it would be a serious impediment to mainstream monetary policy and in the (perceived) interests of society the authorities would be forced to act.


The greatest threat to bitcoin is competently managed fiat currencies. If they're run flawlessly, then there's a much lesser case for bitcoin. If bitcoin is adopted to a point where it limits the ability of that country's CB to implement monetary policy, it means that they have screwed up royally and failed that country's citizens. If they're concerned about that eventuality, it's totally in their hands.  Don't mismanage and it won't be an issue.



			
				Duke of Marmalade said:
			
		

> I don't think it is nearly so far along that road as to threaten mainstream monetary policy.


I agree - albeit with the understanding that this isn't an objective as far as the vast majority of crypto proponents are concerned. In fact, I can't for the life of me understand how anyone couldn't see this as a force for good. Imagine if you're a dictator or wayward regime in the developing world. If bitcoin has gotten to a point where its understood by people and its easier to use, you know that if you screw up with the sovereign currency through mismanagement - you're going to lose total control. It has the potential to offer people an alternative if the incumbent is being mismanaged. It provides an incentive for all of those regimes not to mismanage.



			
				Duke of Marmalade said:
			
		

> The issue of criminal utility is a separate one which I am trying to stay out of it as it only gives @tecate the excuse to accuse me of persecuting the cult.


The issue of criminality has been well and truly dealt with - ergo, there's no more criminality in bitcoin's use than there is with cash fiat or electronic fiat. The tar and feathering on that score is exactly that - tar and feathering.  The same with the 'cult' references that you persist with - in an attempt to sully it....from the proponent of the '[broken link removed]' cult.



Duke of Marmalade said:


> What a brass neck?  Do you remember shouting from the rooftops that Professor Roubini had used the term "store of value".   That was seriously out of context.


Apples and oranges your Dukeness. I recall it being discussed whilst all the while acknowledging that he was continuing with the bile and vitriole he reserves for bitcoin. It was an attempt to walk something back as he knows it's being established as a store of value despite his protests going back years already. Bitcoiners gave him hell for it - and so he returned to doubling and tripling down with the hate-filled anti-bitcoin outbursts.

On the plus side, it's at least something that you acknowledge that you purposefully took Stevens' comment out of context. A contrived allegation that I have done the same previously doesn't justify that.


Duke of Marmalade said:


> My reference to Stevens view of central bankers highlights a big rift in the cult between those (like yourself) who think that central bankers are the anti christ



I don't believe that central bankers are the 'anti-christ'. I've never stated such a thing - over the course of 4 years of discussion here. What I have pointed to is in line with what Stevens mentions - i.e. that programmatic money is far preferable to the whims of 12 unelected officials in a central bank. Even when making genuine attempts at managing a currency (which I believe the vast majority certainly are), the outcomes aren't always in the interests of society. That's before we get to human flaws and the ability for individuals to totally mismanage. Time and time again, we have examples of sovereign currencies that have been mismanaged - with a list of current examples available in any given year.



			
				Duke of Marmalade said:
			
		

> and those who in "humility and empathy" understand that they simply can't help their upbringing.


If you're comparing Stevens' approach to the bile and vitriol that emanates from the nutty professor, I know exactly what you mean.


----------



## Duke of Marmalade

@tecate I note from the tone of your last post that you have signed up to _Wolfie's_ truce, at least until the next outbreak of hostilities.  I note your points and I think at this stage we both know exactly where we are coming from. 
I generally enjoy and learn from your many links but that last one I did find distasteful.  It got off to a very bad start with the guy protesting his concern for the "poor man"; he just didn't look the part; and as for the interviewer, Chris Wallace he was not.


----------



## tecate

Duke of Marmalade said:


> I think at this stage we both know exactly where we are coming from.


Agreed.


Duke of Marmalade said:


> I generally enjoy and learn from your many links but that last one I did find distasteful.  It got off to a very bad start with the guy protesting his concern for the "poor man"; he just didn't look the part; and as for the interviewer, Chris Wallace he was not.


It's not a probing interview - and from the very outset, they both acknowledge they're good buddies going back years. That doesn't mean to say that there isn't something to be learned from it. Is it biased/prejudiced?  By virtue of the fact that its one persons opinion/view/experience, that's assumed in all cases. I wouldn't ever suggest anyone ever rely on any one opinion or even lots of various opinions without thinking critically for themselves.
I listen to podcasts/interviews from a whole host of people on an ongoing basis (including those on the other side of the fence eg. Roubini). This one - I referenced - as his comments on regulation (i.e. there's going to be a back and forth re. regulation and some of it is going to be aggressive) was poignant in terms of the discussion being had with @letitroll .
As regards the interview as a whole and what he mentions may be coming up in the future, he's in a better position than you or I to determine that. Could he be talking up his own book? Of course - and I'd default to being a natural cynic from that point of view as most do talk up their own book - either consciously or otherwise. However, they're dealing with the back end and infrastructural side. I'm not sure to what extent he needs to do that - or to what extent it would benefit him. Regardless, it's just one snapshot - that goes into the mix with a thousand others - and in jumbling through all of that, people make up their own minds.


----------



## WolfeTone

Duke of Marmalade said:


> that you have signed up to _Wolfie's_ truce,



Have to hand it to you Duke, you certainly know how to twist a tale in the direction you want  (_that's a backhanded compliment btw) _



tecate said:


> I listen to podcasts/interviews from a whole host of people



For @Duke of Marmalade I would recommend

What Bitcoin Did

 Featuring none other than one of @Duke of Marmalade "_people who know more than me and you",_ economist, and Christian, Frances Coppola and bitcoin maximalist Nic Carter.

People who know more

Frances, predicted earlier this year than bitcoin would collapse or cease by June this year following an unpleasant bout of trolling on social media for her criticisms of bitcoin.

Notwithstanding all of that, the discussion is civilised and reasonable and Frances is a very nice person. It features morality and religion, central banks and QE, scalability, rogue states, shadow banks, international settlements, etc...

Ordinarily I would advise to jump past the introductory plugs and ads but even at that, the plugs by the host give a glimpse into the technical development emerging in the crypto sector.

Give it 10-15mins, see if it of interest.


----------



## Duke of Marmalade

WolfeTone said:


> Have to hand it to you Duke, you certainly know how to twist a tale in the direction you want  (_that's a backhanded compliment btw) _
> 
> 
> 
> For @Duke of Marmalade I would recommend
> 
> What Bitcoin Did
> 
> Featuring none other than one of @Duke of Marmalade "_people who know more than me and you",_ economist, and Christian, Frances Coppola and bitcoin maximalist Nic Carter.
> 
> People who know more
> 
> Frances, predicted earlier this year than bitcoin would collapse or cease by June this year following an unpleasant bout of trolling on social media for her criticisms of bitcoin.
> 
> Notwithstanding all of that, the discussion is civilised and reasonable and Frances is a very nice person. It features morality and religion, central banks and QE, scalability, rogue states, shadow banks, international settlements, etc...
> 
> Ordinarily I would advise to jump past the introductory plugs and ads but even at that, the plugs by the host give a glimpse into the technical development emerging in the crypto sector.
> 
> Give it 10-15mins, see if it of interest.


I gave it a go _Wolfie_.  Many of the points have come up here.  The one on divisibility and scarcity was a rabbit hole occupied by myself and @tecate some time ago.  I agree with the bitcoiner on that one.   
Frances did get one very good punch in: "holding bitcoin as a custodian is  completely different from holding it as a reserve asset".  More generally these claims that bitcoin is being adopted by this institution or that are really just them catering for a segment of their customer base  (Microstrategy and Tesla are exceptions to that).  Nic eventually agreed.
But in general I found that FC's objections were of a practical or even an ethical nature, she seemed to accept the underlying concept.  I am much more a Roubinist/Nobelist - bitcoin is a nonsense, a BOHA, sorry if that offends.


----------



## WolfeTone

Duke of Marmalade said:


> I am much more a Roubinist/Nobelist - bitcoin is a nonsense, a BOHA, sorry if that offends.



None taken. I just referenced that podcast as a good example of what @tecate was alluding to by listening to a broad spectrum of opinion. In between the positions of - _bitcoin destroying central banks_ *v* _central banks destroying bitcoin_ - there is a large swathe of what I consider reasoned opinion and rationale thinking worth considering.
I am of the view that there is simply too much intellect standing behind bitcoin for it not to have some substantive underlying value. 
What that value is in monetary terms I'm not sure. Although I note that bitcoin has returned to within range of my medium term forecast of $34,500. I did not forsee the Musk intervention and its impact. It appears to have subsided somewhat, for now.

I am actually quite bearish on bitcoin for the forseeable future if inflation takes hold in any significant way in the monetary system. It will be the management of that inflationary environment by central banks and governments that will determine how bitcoin performs. Im biased in thinking that things may get messy and bitcoin value will soar after that.


----------



## Duke of Marmalade

@WolfeTone I was reflecting on my OP which was written at the turn of the year when the price was c.$30k.  I am not yet in a position to say "I told you so" but I am getting there.  I hand it to you that you have had that honour ($34.5k) several times including today, congrats.
I note your circumstantial argument that there are enough smart cookies who are bitcoiners that it couldn't be a BOHA, a sort of counter to my argument that the really smart cookies do think it's BOHA.
Reflect that there are several major religions in the world each with  what appear to be quite far fetched belief systems and each absolutely stuffed with some very keen intellects.  There can at most be one that is correct.
I would say that Ross Stevens is not thick, yet somehow he contrives to see a connection between bitcoin and Darwin's theory of evolution.


----------



## WolfeTone

Duke of Marmalade said:


> Reflect that there are several major religions in the world each with what appear to be quite far fetched belief systems and each absolutely stuffed with some very keen intellects.



And more in-between, that have sustained value over the centuries. 



Duke of Marmalade said:


> he contrives to see a connection between bitcoin and Darwin's theory of evolution



He is talking about money. An abstract universal concept of communication between humans to transmit value between each other that has its origins as far back as the stone age. 
It has taken many forms. Shells, clay tablets, barter, gold, silver, art, fiat, and now in a digital form, bitcoin.


----------



## Duke of Marmalade

WolfeTone said:


> And more in-between, that have sustained value over the centuries.


Good point.  And I was reflecting that some (most) modern art is BOHA to me but there are clearly folk who think it is not BOHA and that is good to put a quite significant market cap on that space.


----------



## WolfeTone

Duke of Marmalade said:


> I was reflecting that some (most) modern art is BOHA to me but there are clearly folk who think it is not BOHA and that is good to



For sure. Art, religion, political, economic and monetary ideology... most of it can be BOHA to most people, most of the time.

Through the millenia, however, any particular strain or trend can take ascendency and sustain itself for centuries, or for as little as 15 mins of fame, or anywhere between.

Catholicism, Protestantism, Islam, Renaissance, Punk Rock, Rubiks Cube, Coca-Cola, Elvis, FF, Marx, Friedman, YouTube etc, etc..

I'm watching an interview between Martin Tyler and Sergio Augero on TV recounting Agueros famous goal to win Prem League.
For 90+% of global population... BOHA.
For a football fan like myself, a priceless moment, (and I'm  a Liverpool fan).

The euro for instance. 20+yrs old, and me being a single currency type of person, I have to say I am not particularly endeared to the construct of this currency. It holds the ascendency, for now. But its construct is badly engineered. Albeit, for "greater good" or best intentions, its a bit of a mess.

Thank God for bitcoin.


----------



## letitroll

Have to love crypto - hope @WolfeTone and @tecate werent Moonbois and DeFi100 fans:


----------



## WolfeTone

letitroll said:


> Moonbois and DeFi100 fans:



Wha's dat?


----------



## letitroll

Crypto project with coins and decentralized philosophy to stick it to the centralized finance overlord government controlled pigs…..…..but the founders just centralized the money into their accounts and ran away and left that note on their website for the DeFi community/network. Happened yesterday - surprise surprise as the crypto world unravels









						$32 Million Stolen As Crypto Project DeFi100 Pulls The Rug
					

Cryptocurrency project DeFi100 (CRYPTO: D100) has informed its investors that it defrauded them of their funds.




					www.google.com
				




More emperor has no clothes news to follow next week id guess as leverage undoes people in crypto land


----------



## WolfeTone

letitroll said:


> but the founders just centralized the money into their accounts and ran away



that would never happen in the regulated fiat world?


----------



## letitroll

WolfeTone said:


> that would never happen in the regulated fiat world?


In regulated fiat world you:
(1) you would be unable to market or solicit investment from retail investors without a due diligence assessment on both sides, acreditied  investor etc.- crypto sh1tcoin world is 99% retail money
(2) in fiat world - you might actually know the name of the person who handed your life savings over to….these projects are in the name faceless and decentralized….good luck picking the con artist out of a line up!

I could go on…but it’s Sunday


----------



## WolfeTone

letitroll said:


> I could go on…but it’s Sunday



So you seem pretty certain that it couldn't happen in regulated fiat world, otherwise you would have answered the question.


----------



## tecate

letitroll said:


> Have to love crypto - hope @WolfeTone and @tecate werent Moonbois and DeFi100 fans:


Yes, such a thing happens. People have to do their own due diligence and assess risk. Just so that there's no misunderstanding, nobody wants shysters in the sector. However, this event doesn't mean that everything is a scam. This event doesn't mean that there isn't a wave of innovation in development here. There are very few who believe that most of these projects will still be standing a few years from now.  There will be a handful of successful projects/protocols that get adopted.
On the Moonboi reference, we've touched on this before. Although we have some level of institutional buy-in, crypto was always and still is a retail phenomenon.  That means a very broad spectrum of stakeholders - from the professional to amateur to moonboi status. Not everyone falls under the latter category. There are also many incredibly bright people working in / associated with this space....many of whom have left successful careers in financial services/banking/tech to work on various aspects of what is being developed here.



			
				letitroll said:
			
		

> Crypto project with coins and decentralized philosophy to stick it to the centralized finance overlord government controlled pigs


Same point to be made on that statement as I made above. There may be extreme views to be found, but that doesn't mean that there aren't pragmatic views to be found within the space also - those who look at what the technology can be used for and go about applying it in those instances.



			
				letitroll said:
			
		

> Happened yesterday - surprise surprise as the crypto world unravels . . . More emperor has no clothes news to follow next week id guess as leverage undoes people in crypto land


whatever may happen in the week ahead, there are likely to be less liquidations - leveraged traders have been cleared out.
Question for you. Are you suggesting then that crypto is DOA in the next 6 months or so?


----------



## DublinHead54

DazedInPontoon said:


> This is flat out wrong. The code is public, open source and licensed in a way that anyone is free to change it and redistribute it. This means anyone can make *their own* changes to the code, they can decide to run the code with those changes and they can release it for other people to run.
> 
> However, no one can force anyone to run any particular code changes. The 'official' bitcoin code repository and the set of core developers who work on it have no actual power to compel people to run their code. Users (meaning users, miners, nodes and exchanges etc) run their code by choice not because they're forced to.
> 
> If the current core developers decided to change the code in a way that the users did not like, such as increasing the coin issuance, the users would react by not running code that included that change.



It is not wrong, the version of Bitcoin that we know and love and currently has consensus can only be changed by ~6 people. You are right that anyone is free to change the code but it is very unlikely that it will achieve consensus and those blocks be the ones that continue.

That being said the scarcity of Bitcoin is hardcoded and can be changed, but it is unlikely today to be supported by the community. However, that can change in the future. So the possibility of the amount of coins changing does exist.

In summary, BTC is a algorithm but still requires trusts in humans.


----------



## WolfeTone

Musk is at it again, this time talking to North American miners about renewables usage, BTC +20% today.

Personally, I wish he would just say nothing at this point.


----------



## tecate

WolfeTone said:


> Musk is at it again, this time talking to North American miners about renewables usage, BTC +20% today.
> 
> Personally, I wish he would just say nothing at this point.


Saylor set up the meeting. He also said that miners were going to tackle this environmental fud with proper disclosure of energy mix.

Elon is definitely complicated to say the least but there may eventually be light at the end of the tunnel.

Meanwhile Ray Dalio disclosed this morning that he holds bitcoin and would sooner hold it than bonds in an inflationary environment.


----------



## presidenttttt

unfortunately they teach irish in school and not IT.









						How Does Bitcoin Mining Work?
					

Bitcoin mining is how new bitcoins enter into circulation. It's also a critical component of the security of the blockchain ledger.




					www.investopedia.com
				




If the code is changeable, is there no way to release coins in a very slow way, to replicate this mining process time? Was it foreseen that people/orgs would mine in this way- biggest computer wins (or should win over long run).

For something that’s supposed to stop the central control of the current system it looks to be benefitting an equally small number. Even the US President can’t move any currency like Elon moves this thing.


----------



## tecate

presidentttt said:
			
		

> Was it foreseen that people/orgs would mine in this way- biggest computer wins (or should win over long run).


Yes. Here's a comment from Satoshi from July 2010:

"_The design supports letting users just be users. The more burden it is to run a node, the fewer nodes there will be. Those few nodes will be big server farms. The rest will be client nodes that only do transactions and don’t generate."_

Note his/her/their acknowledgement of  server farms. At the end of the day, miners provide a service and they're compensated for the service they provide.




presidenttttt said:


> For something that’s supposed to stop the central control of the current system it looks to be benefitting an equally small number.


It's designed to offer an alternative to current centralised systems - rather than stop them.  In what way is it benefiting a small number?  Bitcoin is available to you today should you decide to use it. In terms of the original distribution, it was available to anyone who wanted it for virtually nothing at the outset - and at decent value at various points in between then and now. Other than having to pay its current market value, nobody can stop you from using it or the network it runs on.



presidenttttt said:


> Even the US President can’t move any currency like Elon moves this thing.


Price action on that basis is indicative of an asset that lacks maturity and one that is still going through the adoption curve. I'd also point out that Elon moved the market relative to newcomers much more so than those that have involved themselves with bitcoin or held bitcoin over a longer timeframe. On-chain analysis has shown that those who bought/sold on the back of Elon's endorsement and more lately, his reservations have been found to have held bitcoin very much in the short term.


----------



## Duke of Marmalade

presidenttttt said:


> unfortunately they teach irish in school and not IT.


Would math not have been more appropriate?


			
				Investopedia said:
			
		

> Bitcoin mining is the process by which new bitcoins are entered into circulation, but it is also a critical component of the maintenance and development of the blockchain ledger. It is performed using very sophisticated computers that *solve extremely complex computational math problems.*


This is typical hype from bitcoin enthusiasts.
Actually neither math nor IT would help you one iota in bitcoin "mining".  The same Investopedia link that you provided gives the following flat contradiction to the hype opener.


			
				Investopedia said:
			
		

> "What do you mean, 'the right answer to a numeric problem'?"
> 
> *The good news: No advanced math or computation is involved. *You may have heard that miners are solving difficult mathematical problems (YES THE INTRODUCTION TO THIS PAGE]—that's not exactly true. What they're actually doing is trying to be the first miner to come up with a 64-digit hexadecimal number (a "hash") that is less than or equal to the target hash. It's basically guesswork.
> 
> *The bad news: *It's guesswork, but with the total number of possible guesses for each of these problems being on the order of trillions, it's incredibly arduous work. In order to solve a problem first, miners need a lot of computing power.


Or to put it more simply it is like playing the Lotto.  You keep guessing the number until it meets the test.  It is in fact 100 trillion that's 100 thousand billion times harder for a guess to win the bitcoin Lotto as it is for a single try to win the Irish Lotto.
It wasn't always that difficult.  In fact it is 21 trillion times more difficult today than when Satoshi released it.  That is because the price of bitcoin has attracted so much computer power to make the guesses.  In the analogy the number of lotto numbers is automatically increased to keep the win rate at about 1 per 10 minutes.

So have no regrets for learning the cupla focal.


----------



## DublinHead54

presidenttttt said:


> unfortunately they teach irish in school and not IT.
> 
> 
> 
> 
> 
> 
> 
> 
> 
> How Does Bitcoin Mining Work?
> 
> 
> Bitcoin mining is how new bitcoins enter into circulation. It's also a critical component of the security of the blockchain ledger.
> 
> 
> 
> 
> www.investopedia.com
> 
> 
> 
> 
> 
> If the code is changeable, is there no way to release coins in a very slow way, to replicate this mining process time? Was it foreseen that people/orgs would mine in this way- biggest computer wins (or should win over long run).
> 
> For something that’s supposed to stop the central control of the current system it looks to be benefitting an equally small number. Even the US President can’t move any currency like Elon moves this thing.



This is quite topical at the minute, see below









						'This Isn't the Start of OPEC': New Bitcoin Mining Council Just Wants to Promote Greener Practices, Member Says
					

The Saylor- and Musk-led group won't mess with Bitcoin's code or fungibility, says Argo Blockchain CEO Peter Wall.




					www.coindesk.com


----------



## tecate

Duke of Marmalade said:


> This is typical hype from bitcoin enthusiasts.


Dukey, I fail to see how you're getting hung up on this - or how anyone claims this as 'hype'. Insofar as I can figure out, that phrase seems to be emanating from the one source - a writer for Investopedia. You're then quoting from a second Investopedia article for the rest of it.
Who else is using that specific phrase? Most describe the process as 'solving a puzzle' or 'solving an equation'. Otherwise, its clear that some second-rate online publications have lifted the phrase from the Investopedia article - so your beef is with the writer - not with anyone else. Investopedia have a policy on corrections - so if it irritates you that much, contact them and ask them to update it.
I couldn't care less whether the computation is 'complex' or otherwise - so long as overall it does what it says  on the tin - i.e. provide the most robust network security there is.
The takeaway in terms of achievement in computer science for Satoshi/bitcoin, isn't 'solving complex computational problems'. It's solving the 'double spend' problem and in finding a way of achieving consensus between participants on the network.


----------



## Duke of Marmalade

tecate said:


> Dukey, I fail to see how you're getting hung up on this - or how anyone claims this as 'hype'. Insofar as I can figure out, that phrase seems to be emanating from the one source - a writer for Investopedia. You're then quoting from a *second *Investopedia article for the rest of it.


No that is the incredible thing, it is from the same link from @presidenttttt The article must have been written by more than one person.  The opening paragraph uses the hype, but later on we get the reality which is amazingly prefaced by "you may have heard that miners are solving difficult mathematical problems" .   We certainly have in this very article!!
But it's *not *a monster point.
Now of more concern if I was an enthusiast (giving "cultist" a rest during the truce) is this suggestion by Frances Coppola that the 21m limit can be increased and more worrying still is Musk and Saylor having to deny that they want "clean" and "dirty" bitcoins.  Is that even possible?  Not a concern for me as I am not a bitcoiner.


----------



## tecate

Duke of Marmalade said:


> No that is the incredible thing, it is from the same link from @presidenttttt The article must have been written by more than one person.


So Investopedia again? 


Duke of Marmalade said:


> But it's *not *a monster point.


Yeah, I would say that it's on Investopedia - not on anyone else. There is no hype here. I couldn't give a fiddlers if they edited their article(s) from 'solving complex computations' to 'solving puzzles'.



Duke of Marmalade said:


> Now of more concern if I was an enthusiast is this suggestion by Frances Coppola that the 21m limit can be increased


Turkeys can also vote for Christmas  but strangely enough they don't. I'm not in any way concerned as users have the power in this scenario.



Duke of Marmalade said:


> And more worrying still is Musk and Saylor having to deny that they want "clean" and "dirty" bitcoins.  Is that even possible?  Not a concern for me as I am not a bitcoiner.


Not a concern for me either. There's a bitcoin upgrade in the works which helps with privacy - it should be effective by November. If there are more moves towards this clean/dirty bitcoin approach, one further privacy upgrade will sort that.


----------



## letitroll

Wall St Journal stealing some of our chat content, scoundrels  









						Opinion | Ban Cryptocurrency to Fight Ransomware
					

The existence of bitcoin and the rest benefits nobody except criminals and speculators.




					www.wsj.com


----------



## tecate

letitroll said:


> Wall St Journal stealing some of our chat content, scoundrels
> 
> 
> 
> 
> 
> 
> 
> 
> 
> Opinion | Ban Cryptocurrency to Fight Ransomware
> 
> 
> The existence of bitcoin and the rest benefits nobody except criminals and speculators.
> 
> 
> 
> 
> www.wsj.com


Are we supposed to be impressed because this 'opinion piece' appears in the WSJ?  I think that's the notion as we've discussed every piece of this already. On that, I in no way agree - quite the opposite. The WSJ and FT have been dressing down BTC for years already. You'd love Jemima's pieces over at the FT ( although personally, I wouldn't wrap my chips in them). At least the NYT ran with how this actually needs to be addressed. 

Your guys piece is pure clickbait. How is bitcoin at fault for all the ransomware (like he claims) when it accounts for $350 million out of $20 billion?


----------



## Firefly

tecate said:


> How is bitcoin at fault for all the ransomware (like he claims) when it accounts for $350 million out of $20 billion?


Where did the article say that _bitcoin was the fault for all the ransomware_? 

The article says _"Ransomware can’t succeed without cryptocurrency. The pseudonymity that crypto provides has made it the exclusive method of payment for hackers. It makes their job relatively safe and easy."_. To me the point being made is that bitcoin _facilitates _ransomware. Without bitcoin (and other cryptos) how would criminal gangs get paid for their ransomware attacks?


----------



## tecate

Firefly said:


> Where did the article say that _bitcoin was the fault for all the ransomware_?
> 
> The article says _"Ransomware can’t succeed without cryptocurrency. The pseudonymity that crypto provides has made it the exclusive method of payment for hackers. It makes their job relatively safe and easy."_. To me the point being made is that bitcoin _facilitates _ransomware. Without bitcoin (and other cryptos) how would criminal gangs get paid for their ransomware attacks?


It's implicit in this line of FUD that's emerging despite the fact that it's just a tool - a tool that can be used to do good or to do bad. According to this logic, we should ban the internet.  How about words? Criminals also use words - should we ban words? The whole thing is ridiculous.

Homing in on the piece that you quoted, the guy reckons that ransomware can't succeed without crypto - and yet he goes on to describe precisely how it can be achieved without crypto. He then quotes a figure which he says bitcoin/crypto is responsible for in ransomware booty - which represents a fraction of the entire ransomware booty thats understood to get hived away each year. 

What's really going on here?  This is what's really going on =>



__ https://twitter.com/i/web/status/1397106939193085952
Carl Icahn came out yesterday and said something along the lines that he'd like to take a position in bitcoin. Either that means he already has or he'll need the right conditions to create an entry point for himself (see above). These guys aren't going to like being front run by a crowd of retail peasants.


----------



## 24601

I'd be interested in hearing people's views on the 5th money laundering directive and its impact on Bitcoin. The Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021 has been enacted but is awaiting commencement. The intention is to tackle the anonymity aspect but I don't see how this will work in practice given the global aspect of cryptos and the technical ease with which the new rules can be ignored.


----------



## Firefly

tecate said:


> Homing in on the piece that you quoted, the guy reckons that ransomware can't succeed without crypto - and yet he goes on to describe precisely how it can be achieved without crypto.


Where does he do this? 

The only reference I can find is:  _"Before cryptocurrency, attackers had to set up shell companies to receive credit-card payments or request ransom payment in prepaid cash cards, leaving a trail in either case. It is no coincidence that ransomware attacks exploded with the emergence of cryptocurrency."_


----------



## tecate

24601 said:


> I'd be interested in hearing people's views on the 5th money laundering directive and its impact on Bitcoin. The Criminal Justice (Money Laundering and Terrorist Financing) (Amendment) Act 2021 has been enacted but is awaiting commencement. The intention is to tackle the anonymity aspect but I don't see how this will work in practice given the global aspect of cryptos and the technical ease with which the new rules can be ignored.


Some of the unwieldy regulatory requirements of 5MLD drove some crypto-based startups out of Europe.

In the US, manuchin wanted to place a requirement on exchanges to get all customers to confirm the ownership of the crypto wallet they move funds to.  It was stupidity - as funds can be moved on to another wallet - and another wallet.
This sort of thing - the powers that be having their control challenged - is going to be central to the back and forth on regulation over the next few years. They can ban it - or take a really hard line - and drive the innovation that's coming with  it out of the country.  That's the bind they find themselves in.

A couple of years back, someone here mentioned that crypto would have to fit in with regulatory frameworks designed for traditional finance. That is what many agencies have been trying to do but it won't work. Regulation will need to cater for crypto rather than trying to force compliance that's ill-fitting.


Firefly said:


> Where does he do this?
> 
> The only reference I can find is:  _"Before cryptocurrency, attackers had to set up shell companies to receive credit-card payments or request ransom payment in prepaid cash cards, leaving a trail in either case. It is no coincidence that ransomware attacks exploded with the emergence of cryptocurrency."_


Right there. Added to that, I'll add what I mentioned to @letitroll the other week. Even if there was no other way, you think that hackers won't hack?  They'll do it anyway - for the kicks, the challenge, etc. Other than that, this sort of thing is central to how governments are attacking one another these days. Who's to say that the Colonial Pipeline attack wasn't sanctioned/orchestrated by Moscow?

As per the NYTs take on the subject (and what I said last week), if these organisations focus on addressing their network security then there's no question of having to pay anyone with anything.


----------



## Firefly

tecate said:


> Right there. Added to that, I'll add what I mentioned to @letitroll the other week. Even if there was no other way, you think that hackers won't hack?  They'll do it anyway - for the kicks, the challenge, etc.


But we're not talking about hobbyist hackers are we? We are talking about organised criminals who are in it for the money. How would they paid for their ransomware if not via cryptocurrencies? Sure, they could "_set up shell companies to receive credit-card payments or request ransom payment in prepaid cash cards" _but it's a LOT more work, would involve lawyers & accountants and leave an easier trail to follow... Adding to this...before the advent of cryptocurrencies, there were hobbyist hackers, but I don't remember criminal ransomware happening much, do you?


tecate said:


> Other than that, this sort of thing is central to how governments are attacking one another these days. Who's to say that the Colonial Pipeline attack wasn't sanctioned/orchestrated by Moscow?


But the article relates to _ransomware_. Do you know any governments who have engaged in ransomware and seek payment?


----------



## Duke of Marmalade

@Firefly your last few posts are irrefutable.  I've been in similar positions but learnt not to hold my breath for a climb down.


----------



## tecate

Firefly said:


> But we're not talking about hobbyist hackers are we? We are talking about organised criminals who are in it for the money.


Is there such a giant leap from one category to the other?  I doubt it. If hackers have wreaked havoc in the past without necessarily needing $ compensation, why should this be any different? Sure, it may not be as attractive in a case where there's no $ to exploit, but it wouldn't stop happening in that instance. 
The other point is that a ban wouldn't prevent this sort of thing from happening - so why on earth would anyone go there (specifically for this reason)? Beyond that still, there are other tools - as the writer outlined. Sure, it may be more hassle - but you think that will stop them?  I don't.



Firefly said:


> Adding to this...before the advent of cryptocurrencies, there were hobbyist hackers, but I don't remember criminal ransomware happening much, do you?


My understanding is that ransomware predates crypto. Can crypto be utilised as a tool in such an activity - making the process more seamless? It certainly seems so. 


Firefly said:


> But the article relates to _ransomware_. Do you know any governments who have engaged in ransomware and seek payment?


You're missing the point. Why not use that guise and throw them off the scent? There was speculation that the group in question was linked to the powers that be in Moscow - I'm not sure if there was anything concrete found to back that up.

One way or another, I don't see these attacks stopping - with a crypto ban or without. How about holding organisations accountable for their network security?


----------



## tecate

Duke of Marmalade said:


> @Firefly your last few posts are irrefutable.  I've been in similar positions but learnt not to hold my breath for a climb down.


Another member of the anti-crypto quorum chimes in.  I'm shocked at your findings Dukey - absolutely shocked.


----------



## Firefly

Duke of Marmalade said:


> @Firefly your last few posts are irrefutable.  I've been in similar positions but learnt not to hold my breath for a climb down.


You're right..


----------



## WolfeTone

Firefly said:


> We are talking about organised criminals who are in it for the money



Is bitcoin money? 

Or will these criminals convert their newly acquired bitcoin into $$. 

How exactly will they do that? Maybe they have cash buyers willing to take the bitcoin at discount? All that means is that bitcoin and cash are as culpable in this ransomware scheme. 
Alternatively they could sell their bitcoin on exchanges. But with increasing regulatory oversight on exchanges, a trail will be left. 
For example CAB have strong powers to seize assets and property where unexplained accumulated wealth is detected. 
I don't see why similar cannot be applied to any wealth accumulated from sale of bitcoin.


----------



## tecate

Firefly said:


> You're right..


For sure - that's why the New York Times article focuses on network security. Perhaps the writer in that instance doesn't have a multiple year record of opposition to decentralised crypto as you two.
Imagine we have an organisation renowned for mismanagement (HSE) and they're not being held accountable in any way for this incident.


----------



## Duke of Marmalade

WolfeTone said:


> Or will these criminals convert their newly acquired bitcoin into $$.


Of course they will, criminals ain't stupid.


WolfeTone said:


> All that means is that bitcoin and cash are as culpable in this ransomware scheme.


Please  _Wolfie_ this is not about putting bitcoin in the sin bin.  It is about recognising the "explosion in ransomware" facilitated by crypto.


----------



## WolfeTone

Duke of Marmalade said:


> Please _Wolfie_ this is not about putting bitcoin in the sin bin.



The discussion is based on an article with a headline that says "_Ban cryptocurrency..." _


----------



## Duke of Marmalade

WolfeTone said:


> The discussion is based on an article with a headline that says "_Ban cryptocurrency..." _


So your point is why aren't they asking for a ban on cash.  After all they are both equally naughty girls in this pastime.


----------



## WolfeTone

Duke of Marmalade said:


> So your point is why aren't they asking for a ban on cash. After all they are both equally naughty girls in this pastime.



No, my point is that this "ban crypto..." stuff is silly nonsense.


----------



## WolfeTone

Duke of Marmalade said:


> Of course they will, criminals ain't stupid.



I'm not au fait with the workings of the criminal underworld, so perhaps this is a naive question.
Can you tell me how criminals convert bitcoin into $$ without leaving a trail?


----------



## Zenith63

Bitcoin jumbler services exist where you send your coins, they get mixed with lots of others and you get out different coins which are no longer linked to the crime on the blockchain.  Repeat that a few times then withdraw to cash on exchanges in countries that aren’t too bothered by any of this I guess.


----------



## WolfeTone

Zenith63 said:


> then withdraw to cash on exchanges in countries that aren’t too bothered by any of this I guess.



So lack of oversight by nation states and their regulatory authorities on cash transfers from exchanges are facilitating this fraud?

(rhetorical question)
Should we ban nation states and lax regulatory authorities?


----------



## 24601

tecate said:


> Some of the unwieldy regulatory requirements of 5MLD drove some crypto-based startups out of Europe.
> 
> In the US, manuchin wanted to place a requirement on exchanges to get all customers to confirm the ownership of the crypto wallet they move funds to.  It was stupidity - as funds can be moved on to another wallet - and another wallet.
> This sort of thing - the powers that be having their control challenged - is going to be central to the back and forth on regulation over the next few years. They can ban it - or take a really hard line - and drive the innovation that's coming with  it out of the country.  That's the bind they find themselves in.
> 
> A couple of years back, someone here mentioned that crypto would have to fit in with regulatory frameworks designed for traditional finance. That is what many agencies have been trying to do but it won't work. Regulation will need to cater for crypto rather than trying to force compliance that's ill-fitting.



Having read this I'm fairly convinced that one of the key battlegrounds for Bitcoin and cryptos in the coming months and years will be the AML arena. You seem to frame this purely from the perspective of the powers that be having their control challenged but there is a strong societal interest in minimising criminal activity. It seems money laundering, and by extension terrorist financing, can be facilitated far easier via cryptos. 

I don't think they'll really place much value on the innovation element if organs of the state are falling victim to ransomware attacks every other week or losing out on huge amounts of tax revenue. Regulation catering for crypto will lead to the Wild West.


----------



## tecate

24601 said:


> Having read this I'm fairly convinced that one of the key battlegrounds for Bitcoin and cryptos in the coming months and years will be the AML arena.


I agree that there's going to be plenty of back and forth on regulation going forward. They'll flip flop this way and that.



24601 said:


> You seem to frame this purely from the perspective of the powers that be having their control challenged but there is a strong societal interest in minimising criminal activity. It seems money laundering, and by extension terrorist financing, can be facilitated far easier via cryptos.


We all have an interest in minimising criminal activity. However, AML policy has proven to be an epic failure - and one which comes with a societal cost in terms of trampling over peoples privacy, causing friction in finance to a point where it holds back innovation and it all comes with an incredible financial cost - that one way or another, we all pay for. The world functioned just fine without it - and it can do so again.
On the suggestion that crypto facilitates illicit trade much easier or to a greater extent than fiat cash or electronic fiat - that's incorrect. It may offer advantages to such activity in specific circumstances. However, likewise so too do cash and electronic fiat.



24601 said:


> I don't think they'll really place much value on the innovation element if organs of the state are falling victim to ransomware attacks every other week or losing out on huge amounts of tax revenue. Regulation catering for crypto will lead to the Wild West.


This specific organ of the state has fallen victim yet again to mismanagement. That's what needs to be tackled. Bitcoin leads by example as a network that over the course of 12 years has never fallen victim to any attack. As regards the innovative end of things, some will recognise it and some won't.  The yanks benefited greatly by allowing the last wave of innovation to develop openly whilst the Europeans and others got it wrong. Some will embrace it and some wont. Many of them will change tack back and forth as they go along and as this unfolds.
As regards your dismissal of regulation needing to be shaped around crypto, there has to be a recognition that its entirely different. Existing regulation was designed for something entirely different.


----------



## DublinHead54

Don't coinbase adhere to AML rules? 

Given that even if criminals receive their proceeds in BTC they need to convert it to BTC via an exchange. So AML is still always going to be involved in Crypto.


----------



## Zenith63

Dublinbay12 said:


> Don't coinbase adhere to AML rules?
> 
> Given that even if criminals receive their proceeds in BTC they need to convert it to BTC via an exchange. So AML is still always going to be involved in Crypto.


You don’t my have to use an exchange though, and even if you do you can choose any exchange in any country regardless of whether those countries enforce AML.

You can create a Bitcoin ‘account’ (wallet) on your PC without any interaction (without even an Internet connection) with an exchange or other body that will do KYC/AML and people can send you Bitcoin. Send your bitcoin through a tumbler service (no AML being done by these folks!) and it pops out the other side clean and untraceable.  You can now send it to an exchange in a country that does not care about AML and withdraw your cash.


----------



## DazedInPontoon

Zenith63 said:


> You can now send it to an exchange in a country that does not care about AML and withdraw your cash.


Are there any exchanges in countries that do not care about AML that also will let you withdraw to a european or american bank account? or how do you see the "withdraw your cash" part happening?


----------



## Zenith63

DazedInPontoon said:


> Are there any exchanges in countries that do not care about AML that also will let you withdraw to a european or american bank account? or how do you see the "withdraw your cash" part happening?


Yes.

But the vast majority of ransomware activity is happening from Russia etc, why would a Russian criminal want to withdraw to a US/European bank account?


----------



## letitroll

Just 20% of the USA's meat production taken offline.........no information on payment mechanism









						JBS: Cyber-attack hits world's largest meat supplier
					

The ransomware attack may mean delays for some customers in the US, Canada and Australia, the firm says.



					www.bbc.com
				




Wonder what payment instrument the criminal/terrorists group chose as their preferred choice.....I mean if they're all the same.....cash/bank/bitcoin crypto.......it should be just a game of chance what this ransomware is denominated in

What do you think @tecate @WolfeTone - what method of payment did they choose to use, probably the one that lets them more likely get away with it? No?


----------



## tecate

letitroll said:


> Just 20% of the USA's meat production taken offline.........


Is this a good news story you're presenting?  



letitroll said:


> no information on payment mechanism



This again...ransomware or bitcoin? (or both?) really grinds your gears. Is there a past trauma we need to be aware of? (and in no way do I believe that you aren't aware of the payment means - even if you've picked one specific article that doesn't disclose it).



letitroll said:


> Wonder what payment instrument the criminal/terrorists group chose as their preferred choice.....I mean if they're all the same.....cash/bank/bitcoin crypto.......it should be just a game of chance what this ransomware is denominated in


Here's something that should be instructive to you in terms of self awareness on this topic:

_"I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail_."

You highlight _one_ instance where someone proposed to utilise a tool (in this case bitcoin) negatively today - when bitcoin settles $10 billion worth of perfectly fine transactions every day of the week. Here's what drug money looks like ->







That booty was seized a few years back ( i can get you plenty of more recent examples if you'd like - that's the first one I came across). I mean, there's an awful lot of cash there, don't you think?
ATM skimming costs around $1.3 billion annually. Credit card fraud accounted for losses of $29 billion worldwide in 2019. And as for electronic fiat, that booty above is only in the ha'penny place by comparison with the amount of funds that big banking moves around the globe for the cartels and others on an ongoing basis whilst ordinary people are either excluded from banking access or treated like criminals as they access banking services worldwide.

So clearly, the above spells out that bitcoin is no more used for criminality than any other means. That drives us back to your view that bitcoin just ain't worth it based on the experience of you and your buddies in Ireland not seeing any upside from it. The world is bigger than your peer group - and I've already provided you with data that addresses that point. Notwithstanding that, you are entitled to your view but we won't be finding agreement on that point. Yesterday the Human Rights Foundation allocated $250,000 in grants toward bitcoin development. One small example that thinking varies on this subject.

Beyond that, you're looking for bitcoin to be banned on the back of it accounting for a minority proportion of ransomware payments right now - knowing that it can't possibly be banned in every jurisdiction. Ergo - such a ban would be ineffective. If we just consider that in isolation, why on earth would anyone call for a ban on that basis in the full knowledge that it wouldn't be effective?

In all of these cases, responsibility lies with the organisations themselves. In the case of the HSE - the organisation most easily identified with mismanagement in Ireland - I would have thought that's obvious. It's instructive that you've never acknowledged that.


----------



## letitroll

@tecate answer me this - if you had to bet.......what 'currency' do you think the hackers asked for on this ransomware attack?

As we've talked about Tecate ad nauseum everybody I know uses cash/digital cash to go about their daily lifes - its an invention/innovation that has allowed commerce & trade to happen.......a WONDERFUL tool for the progress of society.....and sometimes used for ill

I have never seen ANYONE in my day to day life use crypto to pay for anything, get paid in crypto, paid or been asked to pay my rent in crypto.........a USELESS invention (so far) for society at large.......but it is so useful for kidnappers and ransomware merchants. It fails the smell test.

And as I've said before........the regulatory authorities & G7 political leadership agree with me.........not you @tecate


----------



## tecate

letitroll said:


> @tecate answer me this - if you had to bet.......what 'currency' do you think the hackers asked for on this ransomware attack?



I've indulged you quite enough on the rhetorical. You may have cited an article that didn't refer to payment method but without a doubt you checked that elsewhere before scribbling your rhetorical question. Furthermore, you can make a mountain out of a molehill all you want - I'll refer you to the use of cash and electronic fiat in criminality above - and what I've listed in that respect in the previous post only scratches the surface.



letitroll said:


> As we've talked about Tecate ad nauseum everybody I know uses cash/digital cash to go about their daily lifes - its an invention/innovation that has allowed commerce & trade to happen.......a WONDERFUL tool for the progress of society.....and sometimes used for ill


And decentralised cryptocurrency forms part of the evolution of money.




			
				letitroll said:
			
		

> I have never seen ANYONE in my day to day life use crypto to pay for anything, get paid in crypto, paid or been asked to pay my rent in crypto.........a USELESS invention (so far) for society at large..


And I'll give you exactly the same answer as when you brought this up the last time. The experience of you and your peer group is not representative of everyone on this planet. When you  last brought this up, you were presented with examples of people seeing the benefits of bitcoin use in other parts of the world - none of which you were able to refute. And for the record, I have been paid in crypto and paid for items in crypto. As regards rent, I suggested payment in crypto when the administrators of the place I'm staying in right now asked me to pay a 5% surcharge for visa payment. They're not familiar with crypto - but that's ok. The metrics show that year on year, its network effect continues to grow and that's all that matters to get this to where it needs to be to effect real change.
The last point I'll make is that your buddies probably didn't have any use for the internet circa 1991 -  back then there were headlines saying that it was a waste of time, it had no potential and it was just a tool for pedo's and criminals. Of course it had scaling issues (sound familiar?) it was only a shadow of what we have today - now that a whole host of services have been built on top of it.




			
				letitroll said:
			
		

> the regulatory authorities & G7 political leadership agree with me.........not you @tecate


I expect regulatory battles to continue over the next few years - and some of it is going to be incredibly aggressive. I've no vested interest in picking one rationale over another as to why any state entity will take a tough stance. Bear that in mind when I tell you that I genuinely don't believe that ransomware is what they're most concerned about when it comes to bitcoin/crypto. You believe otherwise - and that's your opinion.

And they will sway this way and that. India has already banned and unbanned crypto. More recently they banned it again - and then the other day, they released this.

This has more to do with your underlying attitude re. decentralised crypto as it does to genuinely seeking a solution to ransomware. I've asked you on a couple of occasions to consider that Ireland's most mismanaged organisation should be held accountable for this screw up - but all I've heard back from you is crickets. What bug bounty program were the HSE (or any of these entities for that matter) running? What internal discussions were held on the subject?  What plans/procedures were implemented to get out in front of any such attack?  Has anyone asked them that or our 'press' don't want to cause a fuss for a state body? I'll bet my last bitcoin they were sleeping at the wheel on this.

All three attacks that you've referred to have originated from Russia.  What purpose would your G7 bitcoin ban serve when Russia isn't even part of it? Furthermore, I've put it to you that this type of attack will go on regardless of whether bitcoin can be utilised as a payment mechanism. You cited an article previously that explicitly stated that there are other forms of payments being sought. Beyond financial incentive, hackers will do it for the challenge as they've always done. However, in more recent years there has been a war going on by stealth of the cyber variety.  As I mentioned, there was some suggestion that one of those groups had ties to the powers that be in Moscow. Someone else here suggested that ransomware would have nothing to do with a nation state attack.  Yet right here we have a clear example of precisely that - an attack carried out by the Russians under the guise of ransomware -> LINK.


----------



## WolfeTone

letitroll said:


> what method of payment did they choose to use, probably the one that lets them more likely get away with it? No?



Absolutely. And all these attacks are coming from Russia apparently. Time to crush Russia?


----------



## letitroll

@tecate @WolfeTone Uncle Joe agreeing with me:

[broken link removed]

Both of you would seem to suggest that crypto is some neutral tool in the on-going story of global crime - it isnt and were seeing the response now


----------



## tecate

letitroll said:


> @tecate @WolfeTone Uncle Joe agreeing with me:
> 
> [broken link removed]
> 
> Both of you would seem to suggest that crypto is some neutral tool in the on-going story of global crime - it isnt and were seeing the response now



Hold the phones - you told us that there would be an outright ban? You've mentioned a few times that <various statist agencies> 'agree with you'.  Given that governments and their various agents are incredibly reluctant to embrace decentralised crypto, how is this news?  I'm not sure what that brings to the discussion? State actors are generally on your side of the fence.
I've said it before and I'll say it again - the concern around decentralised crypto for governments/central banks/state agencies surrounds a loss of control. Any expressed concern re. ransomware is secondary to them. That doesn't mean that there won't be commentary.  As an example, we had Yellen and convicted fraudster Lagarde trying to tar and feather bitcoin re. illicit use when the data available demonstrates that only 1% of bitcoin transactions serve an illicit purpose.

As regards the Coindesk article you linked to, all that says is that they're looking into it. Of course they're looking into it. There's no mention of a ban, is there?  Earlier this week, the Ransomware Task Force released its framework for dealing with Ransomware. They called for more stringent regulation but at no point did they call for a ban on cryptocurrencies. I guess they know what you aren't prepared to accept - i.e. that a ban won't prevent the use of bitcoin as a means of payment.

More regulation is a given - as what this will really boil down to is uncle sam (and other governments) getting their tax money.


As regards your claim that bitcoin isn't a neutral tool, you know perfectly well that is wayward. In your mind, you think that you can claim that cash and electronic fiat can be used for good or bad but when it comes to bitcoin you apply a different standard.  Not good enough!

Now if you intend to carry on with this, then clarify what measures the HSE took to ensure no such attack ever happened?  What documentation did they release to the irish media demonstrating that they had covered their bases in this instance?  Provide even one link to an irish news source that asked them such questions, please - because it's highly likely they were never asked. That's the actual tragedy here - that people are accepting this sort of nonsense.


----------



## WolfeTone

letitroll said:


> Uncle Joe agreeing with me:



You are getting ahead of yourself. Where is Biden suggesting 'crush' bitcoin?


----------



## tecate

The past 24 hours confirms @letitroll 's claim - decentralised crypto/Bitcoin has no utility and should be summarily banned immediately.


__ https://twitter.com/i/web/status/1400428434443079688
Navalny urges donors to use crypto



			https://twitter.com/mcuban/status/1400456112722178058?s=20
		


In other news, the Russians are ditching the dollar. I guess they're big n bold enough such that they will fare a lot better than Messrs Hussein & Gaddafi when they tried to ditch the petro dollar. Shouldn't be uneventful nonetheless. Maybe we'll have an uptick in cyber attacks..


----------



## DublinHead54

It is ironic that a system designed to solve the need for 'trusted' third parties in digital payments, now relies on trusted third parties to provide access to market participants.


----------



## letitroll

tecate said:


> The past 24 hours confirms @letitroll 's claim - decentralised crypto/Bitcoin has no utility and should be summarily banned immediately.
> 
> 
> __ https://twitter.com/i/web/status/1400428434443079688
> Navalny urges donors to use crypto
> 
> 
> 
> https://twitter.com/mcuban/status/1400456112722178058?s=20
> 
> 
> 
> In other news, the Russians are ditching the dollar. I guess they're big n bold enough such that they will fare a lot better than Messrs Hussein & Gaddafi when they tried to ditch the petro dollar. Shouldn't be uneventful nonetheless. Maybe we'll have an uptick in cyber attacks..


Trading your lebanon dictator led currency.........for bitcoin.....which now has all the hallmarks of being led by a dictator called Elon Musk who tweets about breaking up with it and it moves $2k as result.....so much for decentralization seems pretty centralized to me Elon Musk, Michael Saylor, Chamath...................new boss, same as the old boss.

I feel bad for people in Lebonan or African dictatorships..........crypto doesn't 'solve' this as you laser beam eyed people seem to think, politcal reforms, popular movements &  revolutions do.........this use case is a fig leaf for all cryptos cesspit type activity.........turds mixed with raisins, as Charlie Munger says, are still turds.......crytpo helping people in Lebanon are the raisins.....the rest is turds


----------



## tecate

@letitroll - let us know how you really feel. It's interesting how you'll criticise bitcoin on the basis of Elon's tweets while ignoring the effect of his tweets on certain listings on the traditional market. Meanwhile, you try to liken an example I provide where a central bank prevent people from accessing their own money with the effect of an online influencer? That doesn't stand up. People are free to make their own decisions based on Elon's view if they think that's wise - in the other example, people are being prevented from making a decision with regard to the use of their own money. You can't square those two items as much as you might try.
And as an aside, on-chain analysis has shown that those that both bought and sold relative to the whims of Mr. Musk are newcomers.
As regards Chamath and Saylor, what of them? You're critical of them and the irony is that you bring Munger in, in an attempt to bolster your argument. People tend to hear out those who have proven to be successful - that's in no way exclusive to crypto. If you think that these people control crypto, then you have not proven your point. You can't because it's not true.
On Charlie Munger and Warren Buffett, they're on record as having missed out entirely on the wave of profound tech innovation that emerged from the dot com era. Only very recently have they taken a position in google and facebook, etc. They're incredibly astute people but they're also octagenarians who by their own admission don't understand tech.

So are you calling it then? Bitcoin DOA within 6 months? Is that what you're saying?
Also the G7 ban related to Ransomware, we can expect that within 6 months also?


----------



## letitroll

tecate said:


> @letitroll - let us know how you really feel. It's interesting how you'll criticise bitcoin on the basis of Elon's tweets while ignoring the effect of his tweets on certain listings on the traditional market. Meanwhile, you try to liken an example I provide where a central bank prevent people from accessing their own money with the effect of an online influencer? That doesn't stand up. People are free to make their own decisions based on Elon's view if they think that's wise - in the other example, people are being prevented from making a decision with regard to the use of their own money. You can't square those two items as much as you might try.
> And as an aside, on-chain analysis has shown that those that both bought and sold relative to the whims of Mr. Musk are newcomers.
> As regards Chamath and Saylor, ehwt of them? You're critical of them and the irony is that you bring Munger in an attempt to bolster your argument. People tend to hear out those who have proven to be successful - that's in no way exclusive to crypto. If you think that these people control crypto, then you have not proven your point. You can't because it's not true.
> On Charlie Munger and Warren Buffett, they're on record as having missed out entirely on the wave of profound tech innovation that emerged from the dot com era. Only very recently have they taken a position in google and facebook, etc. They're incredibly astute people but they're also octagenarians who by their own admission don't understand tech.
> 
> So are you calling it then? Bitcoin DIA within 6 months? Is that what you're saying?
> Also the G7 ban related to Ransomware, we can expect that within 6 months also?


Yep I'm calling it....and have called it......but lets be clear what exactly I'm calling before you put words in my mouth.......................Bitcoin down 80%-90% from its peak 2021 price (& never to return to that level $63k all time high again EVER!) This will happen in the next 12 months (some store of value  )......this will be chiefly caused by coordinated G7/20 action which will reverse and choke off bitcoin's, heretofore, ignored, slow progressing integration into the traditional financial system......on ramps / off ramps as the crypto world likes to call them will be severely harshly limited/regulated. Negating its usefulness as a vehicle for at best speculation at its worst crime/tax evasion, terriorsim and ransomware.....when these use cases are removed from the BTC market.....its true "value" as a trading sardine will be revealed. The BTC 2021 hangover is gonna be beauty - trust me.

There you go see you in a year @tecate and then in five year intervals after that.....I've set my calendar to come back and visit you & @WolfeTone


----------



## tecate

So just so that I'm clear, from this day forth, it will never see $63k again, is that correct?


----------



## letitroll

tecate said:


> So just so that I'm clear, it will never see $63k again, is that correct?


Yes, exactly right......Bitcoin's April 13th all time high purchasing power will never be hit again........Coinbase's ATH record indicates the following to be super precise $64,899 on April 13th 2021 at 8pm....agreed on that?.....however.....this is a USD denominated pair trade, we need to pair it with something right, this is ultimately a purchasing power / store of wealth bet so it needs to be anchored in reality?Agreed?You've been arguing purchasing power for 4 pages of this thread so presume this isnt a problem?...... BTC has no value in the REAL world I cant pay my taxes with it, my landlord wont quote me next years monthly rent in it. We need a pairing. BTC is quoted in USD so guess thats the easiest and lazy way to do it.

BUT.......USD by design provides a predictable devaluation path (inflation to you and me). I'm sure WolfeTone will come in with a got ya comment.....but the reality is its a function of credit in the economy and expanding money supply/credit against an increasing productive base.....its a feature, not a bug (as Wolfe Tone and gold bug consirpacy theories would have you think)......a feature which has in the last 150 years coincided with the greatest progress in human living standards ever seen..........AND most importantly STABLE inflation is not a problem........people can and do contract on long term basis knowing the 2% inflation rate.........multi decade contracts are structured with expected inflation rates , loans given etc.......wages are adjusted upwards to maintain purchasing power etc.

Perhaps you would prefer an oz of gold as the pairing given the gold bug instincts of the BTC faithful? Maybe we should use the cost of a Big Mac on Grafton street on April 13th denominated in BTCs/satoshis as the pairing? if you care to figure out the BTC - USD - Oz of gold/ Big Mac calculations (& share your workings with me) for close of business on April 13th we could use that? 

If using USD we should adjust upwards yearly by the FED's 2% inflation target..........I'll allow you in this 'bet' perhaps to enjoy the call option for free that the FED loses control of inflation for a few years (or USD loses its reserve status and is viewed as dirt in the International exchange rate system and so is devalued against other currencies). But think I might be being too generous in this regard when what were really both talking about is purchasing power.

If were being lazy and pairing this in USD to be precise........the inflation adjusted April 13th 2022 all time high USD price target for Bitcoin is $64,899 x 1.02 = $66,196.98 and so on and so forth each April 13th each year...........but maybe the purest expression of our little side bet is actually how many satoshi's it would have cost to buy a Big Mac on Grafton Street on April 13th....and how those satoshis ability to contract for big macs over time changes?.....the reality right now is you'd need to hand over way more satoshis to get a Big Mac today than you did on April 13th.........will McDonald's sell you half a Big Mac  ?.....and in the future I bet its an obscene amount of satoshis......and in the future still it might be lots of bitcons required to get a Big Mac.

This is fun - I'll figure it out for us actually.

From Just Eat's site (https://www.just-eat.ie/restaurants-mcdonalds-grafton-street/menu) Grafton Street McDonald's Big Mac is currently 4.50 euro which is $5.36 at April 13th EUR/USD exchange rate (1e = 1.19124USD) from xe.com...........1 BTC @ $64,899 on April 13th would have bought you 12,108 Big Macs on Grafton Street.........today June 4th with BTC @ ~$37K you could ONLY buy 6,903 Big Macs with the same bitcoin.....Zimbabwe-esque if you dont mind me saying so @WolfeTone  

So our little side bet exactly stated:

(1) ONE bitcoin will never never be able to be exchanged again for 12,108 Big Macs on Grafton Street
(2) Within 12 months from today.........ONE bitcoin will be devalued so much that it will be unable to be exchanged for more than 2,421 big macs on Grafton street........a fall in BTC purchasing power equal to or greater than 80% from its April 13th 2021 big mac purchasing power peak

I think this is fair @tecate and the purest expression of your opinion vs. mine?


----------



## Duke of Marmalade

@letitroll  pizza prices are the benchmark of choice for bitcoin


----------



## WolfeTone

letitroll said:


> then in *five year intervals* after that.....I've set my calendar to come back and visit you & @WolfeTone



Why? I got the impression from you that this will be all done and dusted pretty soon? 2021 if I'm not mistaken, or within next 12 months?


----------



## letitroll

Duke of Marmalade said:


> @letitroll  pizza prices are the benchmark of choice for bitcoin


True!  Like Pomps bitcoin pizza company that only takes $ for payment 









						Bitcoin bull launches pizza company that doesn't accept crypto payments
					

The profits from the first week of Bitcoin Pizza Sales will support the Human Rights Foundation's Bitcoin Development Fund as well as small businesses in ten U.S. cities.




					cointelegraph.com
				




Big Macs are the choice of economists measuring purchasing power parity so we'll go with that I think


----------



## WolfeTone

Duke of Marmalade said:


> pizza prices are the benchmark of choice for bitcoin





letitroll said:


> Big Macs are the choice of economists measuring purchasing power parity



Why do I sense that one of these sentences was written with tongue-in-cheek while the other was cited as serious comment, although they both mean much the same thing?


----------



## DazedInPontoon

As ever there's nothing new under the sun. the "big sats index" https://ecoinometrics.substack.com/p/ecoinometrics-january-18-2021


----------



## letitroll

DazedInPontoon said:


> As ever there's nothing new under the sun. the "big sats index" https://ecoinometrics.substack.com/p/ecoinometrics-january-18-2021



Interesting - good article and somewhat sound analysis by the bitcoin bull who wrote it with an agenda......but glad to see a bull use a BTC/Big Mac pairing........if its good enough for him......its good enough for me and tecate


----------



## tecate

letitroll said:


> I think this is fair @tecate and the purest expression of your opinion vs. mine?


You went to a lot of work on the whole big mac thing in that post but it's much easier if we leave it at BTC/USD if it's all the same to you.


Duke of Marmalade said:


> @letitroll  pizza prices are the benchmark of choice for bitcoin


It should definitely be the benchmark for your champion 'economist' Francis Coppola in her suggestion that bitcoin is unlimited (with her direct inference that it has no hard cap) as it can be divided into sats. Must be a scene from the loaves and fishes when she shares out a pizza!


WolfeTone said:


> Why? I got the impression from you that this will be all done and dusted pretty soon? 2021 if I'm not mistaken, or within next 12 months?


That confidence is lacking of late. We had the original AAM naysayers declare that it was done for - never to re-emerge circa 2018. The narrative has changed in that there is no longer a timeline applied.
@letitroll has said that he expects quite the hangover. I've already stated that I expect an 80% reset (but from the actual market top this cycle - which I don't believe that we have reached yet. Of course, I could be as far out as a lighthouse - we'll see). Bitcoin has been through these cycles many times already. Eventually, there will be a hangover and the doom and gloom will return - whilst developers and other market participants continue to build quietly. In that bear market, we'll be reminded of the peak figure - just like we were over a number of years with the $20k top, the poor suckers that got caught, etc. None of this will mean that bitcoin is done for - far from it.  The story will continue and will be played out on a multi-year basis.
On an all out ban, I have to entertain it as a possibility - but I don't think its a probability on average. Some tough regulation sure - some of it wayward - and a variance between jurisdictions and flip flopping on regulation within jurisdictions. Again, maybe I'll be wrong - we'll have to see.


----------



## WolfeTone

It cost 0.000879 satoshis to buy a Big Mac in April 21.

Today it costs 0.001542. 

A sharp increase in price no doubt, but not nearly as dramatic as the thousands and thousands of Big Macs I can no longer eat.


----------



## Duke of Marmalade

@tecate FC is no champion of mine.  She seems to accept the validity of bitcoin as a currency but erroneously attacks its logistics.  I am an out and out Roubinist - bitcoin is not a currency, end of.


----------



## tecate

Duke of Marmalade said:


> @tecate FC is no champion of mine.  She seems to accept the validity of bitcoin as a currency but erroneously attacks its logistics.  I am an out and out Roubinist - bitcoin is not a currency, end of.


So more of a strict wahhabist approach as opposed to FCs more orthadox naysayer viewpoint. Got it!


----------



## letitroll

tecate said:


> You went to a lot of work on the whole big mac thing in that post but it's much easier if we leave it at BTC/USD if it's all the same to you.


OK great, no problem @tecate  .......you want the easier ride.....a true BTC'er would take the Big Mac purchasing power test...........but I get it stack the deck a little in your favor by adding in some FX volatility, makes sense.............USD it is then with the Fed's target 2% inflation rate ratcheting up our base 2021 $64,888 BTC ATH level each April 13th......I'm being kind here we should probably just use core US CPI in the previous calendar year as the FED has said they'll let CPI run a little hot which I'm guessing means 3% for a couple of years. I'm feeling kind of generous though so no problemo.

Anyway v strange bet were having seen as you seem convinced its gonna drop 80% in value too but hey your the BTC promoter not me.....if I was promoting something as a store of value I certainly wouldn't be going around saying I fully expect it to drop 80%.....but hey different strokes for different folks I guess.

Now to the bet particulars:

 (1) The bet (for bragging rights) then to be clear - is Bitcoin will fall 80% from its all time high in the next twelve months (a function of a tightning global conditions on the crypto world) we could argue all day whether that happens or not....lucky we have the price action........ clock starting April 13th 2021.....running to April 13th 2022. $64,888 the level to be used.

(2) BTC will never reach the ATH it achieved on April 13 2021.....inflation adjusted......ever.....or for as long as you/I care to pay attention to this thread.....whichever comes first  $64,888 ratcheting up 2% a year each April 13th beginning 2022

Sound good?


----------



## tecate

letitroll said:


> .you want the easier ride........but I get it stack the deck a little in your favor by adding in some FX volatility, makes sense.............USD it is then with the Fed's target 2% inflation rate ratcheting up our base 2021 $64,888 BTC ATH level each April 13th......I'm being kind here we should probably just use core US CPI in the previous calendar year as the FED has said they'll let CPI run a little hot which I'm guessing means 3% for a couple of years. I'm feeling kind of generous though so no problemo.



 stack the deck? I'm not in the slightest bit surprised that you don't get bitcoin. Firstly, you said that it wouldn't ever see ATH ever again. You're coming back after the fact with fine print. On that fine print, inflation is FIATs deal. If you have a problem with it, hop on a Zoom call with Jerome Powell and see if he can call off the stealth tax for a few years. There's no 'stacking the deck'. That bs is on your deal and its one of the fundamental reasons I see a need for bitcoin.



letitroll said:


> a true BTC'er would take the Big Mac purchasing power test


I've pulled you up previously on your stereo-typing of folk that see value in btc. I don't profess to be a 'true BTC'er' or whatever in the world that is. I'm not sure why on earth you think that I should account for the stealth tax theft that's inherent in the fiat money system. You've confidence in said system - so I guess you'll need to find a way to #cope.



letitroll said:


> Anyway v strange bet were having seen as you seem convinced its gonna drop 80% in value too


That's the view I stated a couple of weeks back already (and I'm pretty sure somewhere along the line I alluded to a cyclical reset along those lines long before that). The difference is that you believe that it's going to be put on its ass - permanently. That's not my view. Bitcoin has been through several of these cycles already.



letitroll said:


> but hey your the BTC promoter not me....


I'm not a bitcoin 'promoter'. I simply have an opinion on the subject that differs from yours. You seem to think these cycles are the end of the world for bitcoin - but that just betrays the fact that you don't have an understanding of how this has worked out historically and the rationale behind the cycles. It seems you think that if I wanted to _shill_ bitcoin (which I don't), then I couldn't possibly suggest such a thing. I'm not going to express anything other than my opinion/understanding of it. Secondly, if that's what you think this is about, then the most selfish thing I could possibly do is encourage you and others here in your negative disposition towards btc.  The longer this process takes, the greater the potential gains.



letitroll said:


> Sound good?


I asked you to confirm what you originally claimed - i.e. that bitcoin would NEVER see its April 2021 ATH price ever again. If you have conviction in what you claimed/believe, simply respond with yes, that's what my claim is.


----------



## letitroll

Yes, tecate, Yes

even with USD fiat’s stable in built 2% inflation glide path chipping away at each dollar each year….…you and I won’t be on the planet by the time its loss of purchasing power catches up with the BTC crash and burn that’s happened already this year and is coming down the pipe in subsequent years. Of that I’m certain. So happy to stack your deck as much as you want….because truly it’s one of the safest side bets I’ve ever made. Sound good?

do me a favor fill in your excuses for why BTC isn’t back at or above it’s all time highs at year 1,3,5,10 from now when I turn out to be right. I’ll do Year 1 for you it’s an easy one. Gonna be tricky in 2024, trickier still in 2026 and damn right impossible in 2031 to explain away

Year 1: BTC is volitale, but trends up over time don’t worry it will move higher soon
Year 3: …………
Year 5 …………..
Year 10……


----------



## tecate

letitroll said:


> Yes, tecate, Yes


Terrific - thank you for confirming.



letitroll said:


> even with USD fiat’s stable in built 2% inflation glide path chipping away at each dollar each year….…you and I won’t be on the planet by the time its loss of purchasing power catches up with the BTC crash and burn that’s happened already this year and is coming down the pipe in subsequent years. Of that I’m certain.


I guess you're confirming your answer to my other question - which was do you believe that bitcoin is DOA within 6 months. According to your statement above, you're saying that bitcoin is going to be around for many years to come. That's wonderful.



letitroll said:


> So happy to stack your deck as much as you want….because truly it’s one of the safest side bets I’ve ever made. Sound good?


Bad form to make deck stacking claims. You made your original claim without any such provisos. Just as an aside, bitcoin's current inflation rate is 1.76%. I'm telling you this as clearly you have no idea (or else you wouldn't be making a meal out of your 'deck stacking' claims to begin with). That's the thing with programmable money - all participants know what the rules are from the outset.



letitroll said:


> fill in your excuses for why....


Yeah, I can kinda see how this is important to you ...albeit maybe not in such a progressive way  . If it's all going tits up for bitcoin and you ask for my opinion at that point, I'll surely oblige. You may deem that to be whatever you want at the time - that's up to you to interpret. Regardless of what your interpretation is, to me it will just be my 2 cents satoshis on the subject.


----------



## WolfeTone

letitroll said:


> core US CPI in the previous calendar year as the FED has said they'll let CPI run a little hot which I'm guessing means 3% for a couple of years



If 2% is their target, why doesn't the FED let CPI run at 2% all the time in the same way that you think they can let it run at 3% for a couple of years?


----------



## letitroll

tecate said:


> Terrific - thank you for confirming.


Look forward to watching this play out with you @tecate


----------



## letitroll

__ https://twitter.com/i/web/status/1401148964771086337
Bitcoin week in Miami


----------



## tecate

letitroll said:


> Bitcoin week in Miami


Delighted for you @letitroll that Max threw you a bone - by being Max.

Here's Raoul Pal's perspective on Bitcoin 2021:

"To be fair, my flippant comments about the BTC conference being a bit cringe was _a reflection of the media coverage of the more extreme aspects_ _but the truth is the speakers and many of the attendees are some of the smartest, most interesting forward thinkers Ive ever known._"

My understanding is that the conference was a success - with 20,000 attendees.

The announcement by El Salvador's President during the conference that the country will become the first nation to make bitcoin legal tender is a positive step. It's  a tiny country with a tiny GDP and yet the implications of this move extend beyond the Central American country. It may lead to some changes in the tax treatment of bitcoin. It will be handled by banks internationally in the same way as foreign currency. It will be treated as money under commercial law and cash as per accounting rules.

Salvadorans - 70% of whom don't have access to banking - wake up to this front page of Diario El Salvador this morning ->






That's the real outcome from Bitcoin 2021 in Miami.


----------



## letitroll

@tecate dont be happy, be embarrassed - *THIS *is El Salvador https://www.hrw.org/world-report/2021/country-chapters/el-salvador#


----------



## tecate

letitroll said:


> @tecate dont be happy, be embarrassed - *THIS *is El Salvador https://www.hrw.org/world-report/2021/country-chapters/el-salvador#


You think that I should be embarrassed because bitcoin is going to be made available as a fully fledged currency to 6.5 million people - most of whom the banking system just left behind?  Absolutely not. Anyone supportive of the bitcoin project can see that this is a good day for Salvadorans. Alex Gladstein of the Human Rights Foundation makes an important distinction ->


__ https://twitter.com/i/web/status/1401307793278316552


----------



## letitroll

This is a stunt….by a dictator and human rights abuser….your eating it up. Be embarrassed.

Fully fledged currency - are you off your face, do you know nothing about bitcoin and its capacity to process transactions….…….it will take 25 minutes to pay for a loaf of bread in the shop in El Salvador using BTC….as the BTC ledger slowly tries to clear the transaction at an 8%!!!!! transaction……..all the while the loaf of bread,because of BTC volatility, goes from 20 to 30 to 25 to 35 satoshies. Its a pipe dream.

Your embarrassing yourself @tecate jumping on a dictators bandwagon PR stunt to support your thesis…..and acting as if the people of El Salvador will be using BTC to pay for things in the shops.


----------



## WolfeTone

letitroll said:


> @tecate dont be happy, be embarrassed - *THIS *is El Salvador https://www.hrw.org/world-report/2021/country-chapters/el-salvador#



My sense is if it weren't for bitcoin, you would show little concern for the plight of the poor in El Salvador.

You see, bitcoin is actually working in a way that the fiat system has failed in a derisory form.

Is this part of the greatest advancement in human living conditions you were referring to?



letitroll said:


> crypto.........a USELESS invention (so far) for society at large.......but it is so useful for kidnappers


You have just basically posted an article that implies those caged people were kidnapped.


----------



## tecate

letitroll said:


> This is a stunt….by a dictator and human rights abuser….your eating it up. Be embarrassed.
> 
> Your embarrassing yourself @tecate jumping on a dictators bandwagon PR stunt to support your thesis…


I am in NO way embarrassed. This is a progressive move in line with Gladstein's tweeted comments above. You're  screaming about Human Rights when the Human Rights Foundation are supportive of this.



letitroll said:


> Fully fledged currency - are you off your face



Just what exactly about the phrase 'fully fledged currency' has you perplexed exactly? The move will make bitcoin legal tender in El Salvador will it not?



letitroll said:


> do you know nothing about bitcoin and its capacity to process transactions….…….it will take 25 minutes to pay for a loaf of bread in the shop in El Salvador using BTC


Now who's embarrassing themselves? A lightning network payment will take somewhere between a couple of miliseconds and up to 60 seconds. And just so that you're up to speed, local people are accepting bitcoin in El Zonte, El Salvador - and have been for some time.



letitroll said:


> ll the while the loaf of bread,because of BTC volatility, goes from 20 to 30 to 25 to 35 satoshies. Its a pipe dream.


And yet in El Zonte, that's exactly what they are doing. Go figure.



letitroll said:


> ..and acting as if the people of El Salvador will be using BTC to pay for things in the shops.


See above.


And seeing as we are on the theme of embarrassment, do you want to explain why you are supportive of a system that leaves 70% of the citizenry of a country without access to banking? ....and before you claim otherwise, yes, you are supportive of precisely that - as you have summarily dismissed any role for bitcoin or decentralised crypto when the notion has been put to you. Where are your precious bankers in serving the people in that instance?


----------



## letitroll

tecate said:


> Now who's embarrassing themselves? A lightning network payment will take somewhere between a couple of miliseconds and up to 60 seconds. And just so that you're up to speed, local people are accepting bitcoin in El Zonte, El Salvador - and have been for some time.


Your making it up, your clueless on this presume thats why you added in the "will" to your lightning network miliseconds transaction comment as cover.....it doesnt exist outside a whitepaper and a few 1,000 nodes........your acting like its ready for implementation in your local coffee shop.....its still a pipe dream.

Dont mispresent lightning.............especially in a week when I see endless crypto people still struggling on twitter, post the crytp crash, to get their crytpo withdrawn to fiat from various exchanges and wallets because the systems cant even cope with this level of activity.....let alone millions of people buying their coffee with crypto

Or as another person put it on lighting:

"The Lightning Network is a boondoggle project that has demonstrated, repeatedly, that it is an impressively bad security risk for its participants, a supremely poor user experience, and a never-ending repetition of the idea that it will be ready in “18 months”."


----------



## letitroll

I should also say - I'm delighted with the El Salvador move............for my thesis........it only hastens the G20 coordinated response when Grade A scumbags like Bukele are climbing into the bed with BTC


----------



## tecate

letitroll said:


> Your making it up, your clueless on this presume thats why you added in the "will" to your lightning network miliseconds transaction comment as cover.....it doesnt exist outside a whitepaper and a few 1,000 nodes........your acting like its ready for implementation in your local coffee shop.....its still a pipe dream.


I think you're in over your head here.  
I'm not making it up. Granted, lightning network has been incredibly slow in its progression and development is ongoing. But back to what I said - precisely as I said, it is being used by a whole host of vendors in El Zonte, El Salvador and has been for some time. It forms the backbone of Jack Mallers  startup, Strike.  And beyond that, you yourself can send and receive bitcoin using the Breez Wallet within the timeframe I outlined above. Otherwise, I hope to visit in November - so I'll be quite happy to send you a full boots on the ground report then if you'd like.



letitroll said:


> Dont mispresent lightning.............especially in a week when I see endless crypto people still struggling on twitter, post the crytp crash, to get their crytpo withdrawn to fiat from various exchanges and wallets because the systems cant even cope with this level of activity.....let alone millions of people buying their coffee with crypto


I haven't misrepresented lightning. However, in that very sentence - you have. You go on about things that don't involve lightning - so why even mention them in that context?



letitroll said:


> "The Lightning Network is a boondoggle project that has demonstrated, repeatedly, that it is an impressively bad security risk for its participants, a supremely poor user experience, and a never-ending repetition of the idea that it will be ready in “18 months”."


Bravo - you found some criticism of lightning network online. And yet, the fact remains. You have not in any way disproven what I stated. If you don't believe me, you can download a breez wallet and put it to  the test yourself.



			
				letitroll said:
			
		

> I should also say - I'm delighted with the El Salvador move............for my thesis........it only hastens the G20 coordinated response when Grade A scumbags like Bukele are climbing into the bed with BTC


I'm delighted for you - but I guess we should probably wait and see how it all unfolds. What I'm not so delighted about is that you'd like to see an option being taken away from 4.5 million unbanked people - who would go back to being ignored and without options by the system you say is all hunky dory.


----------



## Duke of Marmalade

@letitroll I think you are failing to see the positives in this.
Bukele talks about a boost to employment.  Supermarkets will need to be staffed by an army of "price changers".  There will need to be a skilled cadre of these - the "senior price changers" - as it will be a highly specialised operation to put on the 10th price change of the day, obliterating all previous changes.
I also see a need for increased security in supermarkets.  We all know the frustration of a dottery old duke at the check out fiddling with his coins. But if you are 5th in the Q and watching your app constantly, tempers will boil over if bitcoin makes a dive following some latest rambling from El Musk.

Or maybe to head off this Q-rage supermarkets will guarantee to stand by their prices as displayed on the goods and presumably at your choice of the two legal tenders.  And that gives rise to a whole new area of employment.  SPAs or supermarket price arbitrageurs. I can see it now, a team of about 10 SPAs take up strategic positions at various parts of the shop.  Suddenly it becomes obvious that pampers are seriously underpriced in bitcoin, the Pamper SPA loads up her trolley and heads for the longest Q.  Long Qs now a big bonus as it gives time to change your mind if bitcoin goes in the opposite direction.


----------



## letitroll

Your playing games you know thats a total PR stunt yet your trying to pass it off like its really a thing happening in El Salvador at scale in a couple of places there........at best you've been taken in my friend by classic PR nonsense..at worst your misrepresenting it to defend your position.......I really hope you travel there and see it for yourself presuming you've swallowed it..........Strike is just another run of the mill remittance business with I'm sure some ripple crypto settlement piece trying to get a piece of the action in a lucrative remittance corridor in this case USA > El Salvdor.........and you've bought their propaganda hook line and sinker......and lets be clear Strike in its current form is just a remittance app.....not 6.5m people paying for a loaf of bread in  a shop with Strike point of sale terminals setup like your trying to represent it as.

Your Breez app is also vaporware and not launched - not available in either app stores........crappy beta testing junk......and no business listed on their website where Breez is used as actually used as a point of sale : https://play.google.com/apps/testing/com.breez.client https://testflight.apple.com/join/wPju2Du7


On your small payments happening in El Salvdor claim.......and  your reference to " a whole host of vendors" using BTC to sell 20c bread and newspapers is really just some bitcoin 'doner' throwing shackles to poor people with Strike PR layered on top of it - a stunt.......the Bitcoin millionaire donor behind the stunt trying to will some utopian vision of BTC into life (while hoping it will drive his holdings up I'm sure) & Strike trying to get some PR for a remittance app their launching on the back of it..........be honest what your talking about is really that lovely PR stunt bullshit called *Bitcoin beach*........which you were very careful not to mention cause it sounds so bullshitty.................where bitcoin dreams come true..........just on a website & photos though ..........https://www.bitcoinbeach.com/#press..........from their own website which I'm sure is exaggerating even these numbers.......they have wait for it, wait for it...................*15* businesses participating .........guess the donor wasn't that generous a few thousands dollars would cover this circular nonsense and few crypto student volunteers..........look at the site for christ sakes @tecate with critical eyes a few pictures of some hastily printed BTC banners on the side of vans and an old woman being shown a smartphone, a few t-shirts. Classic vaporware, click bait crap.

Its frankly disgusting and using local poor people as props in a promotional campaign for BTC and Strike to get free media coverage. I know propaganda BS when I see it and you seem like a smart fella this is PR bullshit perpetrated on poor people and your spreading it around. Honestly @tecate you need to get a little streetwise and spot the game being played here.

Look at the website for two seconds and think critically about what's going on here really:














__





						Bitcoin Beach
					






					www.bitcoinbeach.com
				




..............................Two press releases/media articles/updates on that website......TWO!!!!!!!!!.........both dated from Jan 2020........then nothing, no updates, no press, no progress.......silence........and I can assure you COVID didnt stop the wheels turning in this village so dont blame that.................in the PR biz its called a smash and grab.......stage the narrative, print the press release, get the clicks, share on twitter.....nobody follows up........bitcoin probably went up 1% on this nonsense................15 businesses participating it says ...........one of the articles talks about 50 student 'users'.....given a few free $'s to show up for a class.................its nonsense @tecate and the website reeks of nonsense.........I really hope you go there and see for yourself all thats gonna be left is a few dirty BTC banners lying around the town...and people paying in their local currency or dollars......you strike me @tecate as little young and naive in this space. Not every press release is reality.......especially in crypto.

For completeness I did a google news search for this year on bitcoin beach......and nothing......just re-cycling the initial launch press release nonsense and its used over and over again by Strike to publizce their remittance app. Shameless.


----------



## tecate

@dukey : Way to go in writing a 250 word post that says absolutely nothing. I've mentioned it before, a career in standup awaits - albeit that it will be a hard road. Until you work on your material a bit more, you'll be dodging rotten apples and tomatoes for a few years.



letitroll said:


> Your playing games you know thats a total PR stunt yet your trying to pass it off like its really a thing happening in El Salvador at scale in a couple of places there.


That's a bare faced lie. In no way did I mention it was being used at scale. And if you want to try and misrepresent that once more, then I'll have to insist on you quoting where I stated it was being used 'at scale'. We have more misrepresentation from you with the 'couple of places' - I clearly mentioned one location by name.
 The point is that you challenged the technical ability to transact bitcoin in seconds. It's obvious that you were not even aware of that ability up until I pointed it out to you - just as a couple of days ago, you weren't aware that bitcoin currently has its own inflation rate of 1.76%.



letitroll said:


> at best you've been taken in my friend by classic PR nonsense..at worst your misrepresenting it to defend your position..


I'm not in any way concerned about 'defending my position' - but given that you've betrayed a lack of understanding of what's at play here, maybe you might want to consider hitting the books. I already cited the view of Alex Gladstein from the Human Rights Foundation on this milestone. Here's the view of Avik Roy - President of the Foundation for Research on Equal Opportunity:

_"This is a major development in the history of monetary policy"._



letitroll said:


> I really hope you travel there and see it for yourself presuming you've swallowed it..


I've had friends who've traveled there and I certainly hope to find the time to get down there towards the end of the year. The work that Mike Petersen is doing there is important and is to be commended.



letitroll said:


> Strike is just another run of the mill remittance business with I'm sure some ripple crypto settlement piece trying to get a piece of the action in a lucrative remittance corridor in this case USA > El Salvdor..



So not satisfied with being found to have your facts ass-ways, you also need to lie to support your opposition to decentralised crypto also? Provide a link to where Strike are using Ripple, please? Strike are using Lightning Network - the layer 2 solution that you claimed a couple of posts ago was just a whitepaper.



letitroll said:


> .and you've bought their propaganda hook line and sinker.


What propaganda? That rather than use Western Union at 10%, Salvadorans will be able to use his service for a couple of % instead? That propaganda? The propaganda that demonstrates that 70% of Salvadorans are locked out of the banking system? If that's what you claim to be propaganda, then provide proof please.



letitroll said:


> and lets be clear Strike in its current form is just a remittance app.....not 6.5m people paying for a loaf of bread in  a shop with Strike point of sale terminals setup like your trying to represent it as.


And you're contriving to conflate two separate things. Yes, Strike is a Lightning Network payment app - you know, the lightning network that you said was just a whitepaper!?  The Bitcoin Beach project is a community led project that is promoting everyday use of bitcoin as a means of exchange. In a country where the banking system that you marvel about has left 70% of the population unbanked, there is no need for a point of sale terminal. All anyone from a street vendor and upwards needs is a smartphone and a lightning network wallet app.
As regards 6.5 million people using that facility today, you know perfectly well I never made any such claim. You said that it was technically impossible and I specifically referred to El Zonte - to demonstrate that your claim was wayward. I never referred to scale in any way shape or form. However, I will say that this is a milestone towards greater uptake. If you can't see that, then I can't help you.




letitroll said:


> Your Breez app is also vaporware and not launched - not available in either app stores........crappy beta testing junk......and no business listed on their website where Breez is used as actually used as a point of sale : https://play.google.com/apps/testing/com.breez.client https://testflight.apple.com/join/wPju2Du7


Breez app is launched and available via the Google play store. I know because I use it regularly. It - along with Phoenix App - are in beta on IOS. So what? How do you think development works exactly?

Now getting to the rest of your rant - I'm not going to go through it line by line as there's no substance to it. In essence, you're not impressed with the Bitcoin Beach project because its not on a grand enough scale for you. Let me be very clear in my thoughts on that - I don't give a fiddlers. If you don't understand what a community initiative involves, that's your problem. I can't help you with it - you'll have to deal with it yourself.



letitroll said:


> Its frankly disgusting and using local poor people as props in a promotional campaign for BTC and Strike to get free media coverage. I know propaganda BS when I see it and you seem like a smart fella this is PR bullshit perpetrated on poor people and your spreading it around. Honestly @tecate you need to get a little streetwise and spot the game being played here.


All we've seen from you over the last 24 hours is repeated use of the words 'shameless', 'embarrassing' and 'disgusting'. You know what's shameless/embarrassing/disgusting @letitroll? - that you can't even acknowledge that your beloved banking system is rotten to the core and is central to social exclusion in El Salvador and far beyond. You can't even be open minded enough to acknowledge that rather than the poorest of people paying 10% for remittances, it would be a force for the good if they had  the opportunity to pay 1 or 2%.
The inability to be objective enough to recognise that such a modest community-led project in a remote coastal town has been influencial enough to lead to a scenario where bitcoin is likely to be recognised as legal tender for the first time - and the implications that has far beyond the borders of El Salvador. That's what's shameless/disgusting/embarrassing.


----------



## Duke of Marmalade

tecate said:


> @dukey : Way to go in writing a 250 word post that says absolutely nothing. I've mentioned it before, a career in standup awaits - albeit that it will be a hard road. Until you work on your material a bit more, you'll be dodging rotten apples and tomatoes for a few years.


Ouch!  That withering sarcasm hurt.  A consolation is that I got a 50 word response to "absolutely nothing".


tecate said:


> ...you weren't aware that bitcoin currently has its own inflation rate of 1.76%.





			
				Investopedia said:
			
		

> What Is Inflation?​Inflation is the decline of purchasing power of a given currency over time. A quantitative estimate of the rate at which the decline in purchasing power occurs can be reflected in the increase of an average price level of a basket of selected goods and services in an economy over some period of time. The rise in the general level of prices, often expressed as a percentage, means that a unit of currency effectively buys less than it did in prior periods.


By that definition I reckon bitcoin inflation over the last month has been running at over 4,000% p.a.  Maybe El Salvadorians are used to that level of inflation.  I suppose it depends on your definition of "currently".  I chose a month, I presume you chose some other period to suit your narrative.  You surely weren't referring to the change in supply alone. I presumed you were aware of the first law of economics, that price is a function of supply AND demand.

On a separate point @letitroll posted a truly disgusting and revealing video clip from the Miami Bitcoin pilgrimage.  I see in that a complete endorsement of my description of "cult".
"We will not sell" avows the evangelist as if selling bitcoin is sacrilege
"Flip Elon" he screams with venom, though I may have the first word wrong.  Their equivalent of Satan, though maybe that is reserved for Roubini


----------



## tecate

Duke of Marmalade said:


> Ouch!  That withering sarcasm hurt.  A consolation is that I got a 50 word response to "absolutely nothing".



Measured and appropriate, your dukeness. Watch out!  There's a maggoty tomato winging its way towards you.  



Duke of Marmalade said:


> By that definition I reckon bitcoin inflation over the last month has been running at over 4,000% p.a.  Maybe El Salvadorians are used to that level of inflation.
> On a separate point @letitroll posted a truly disgusting and revealing video clip from the Miami Bitcoin pilgrimage.  I see in that a complete endorsement of my description of "cult".
> "We will not sell" avows the evangelist as if selling bitcoin is sacrilege
> "F... Elon" their equivalent of Satan


See above - you really need to start working on some new material. This sort of stuff isn't going to cut it (particularly as the World moves on in spite of your objections).


----------



## Duke of Marmalade

@tecate I suppose if you can't back up your claim that bitcoin inflation is currently running at 1.76% you may as well toss a rotten tomato.  On the other hand the manly thing to do would be to admit the mistake.


----------



## tecate

Duke of Marmalade said:


> @tecate I suppose if you can't back up your claim that bitcoin inflation is currently running at 1.76% you may as well toss a rotten tomato.  On the other hand the manly thing to do would be to admit the mistake.


You're trying to conflate two separate items to confuse matters, your Dukeness. The programmatic nature of bitcoin means that its inbuilt monetary policy currently establishes a pre-determined inflation rate of 1.76% through coin issuance. You want to conflate this with price action and the price discovery process that is ongoing as we progress through the adoption curve when compared with fiat currency. If we don't look to convert to your fiat monopoly money, then 1 btc = 1 btc today - with an inflation rate of 1.76%.

You're welcome.


----------



## letitroll

Breez remittance app - using lightning, oracle database, bla bla whatever it says its using.........its a remittance app......we've been talkng about an at scale national payments system that supports 1000's of transactions a second such that it could replace cash/mastercard/visa.......and you use a start up remittance app as an example of how crytpo is ready. Please admit one thing for me, there is no deployable solution right now off the shelf in crytpo world ready to go tomorrow (that isnt vaporware) to  support the daily transaction needs of 6.5m people & 1000's of payments a second?? Thats my point & if you cant admit that well then. Your in cloud cuckoo land.

@tecate the main thing I love about your post. Which give me hope that your not a complete cultist......is that you completely side stepped the substance of my 250 word post which was really Bitcoin Beach - i.e. BS Beach........and your smart and dug around that website/press section and googled the hell out of it I'm sure looking for substance & counter factuals to show its 'going great' and adoption is increasing............but there isnt any updates. I think your smart enough to have had enough doubt planted in your mind that I'm right on this one.

Its a PR stunt. Community led!!?!?! how? where you see that, cuase it said it on the site? - its led by some millionaire bitcoin fanatic who wanted to print a press release and give the Miami cult something to talk about. The fact you came back with nothing to dispute my supposition except some vague reference to your friend having been there only proves its nonsense.

Bitcoin beach is a PR stunt..........an alice (tecate) in wonderland website creation.........I showed you what was behind the curtain...... nothing......two puff piece advertorials in Jan 2020 and thats it..........you've been hoodwinked if you think there's a village in El Salodvor where people are running around right now paying for haircuts/groceries in bitcoin and loving it


----------



## letitroll

tecate said:


> You're trying to conflate two separate items to confuse matters, your Dukeness. The programmatic nature of bitcoin means that its inbuilt monetary policy currently establishes a pre-determined inflation rate of 1.76% through coin issuance. You want to conflate this with price action and the price discovery process that is ongoing as we progress through the adoption curve when compared with fiat currency. If we don't look to convert to your fiat monopoly money, then 1 btc = 1 btc today - with an inflation rate of 1.76%.
> 
> You're welcome.



Dont use the word inflation, please - call it bitcoins circulating supply increases 1.76%......its more precise.......

Inflation, as a term,  is fundamentally a loss of purchasing power given a fixed unit monetary instrument expressed in goods & services prices denominated in that instrument

@Duke of Marmalade point is valid........bitcoins annual inflation/deflation rate........correctly defined........is insane...........back to my Big Macs example.......in April 1 BTC could buy 12,000 Big Macs on Grafton street.....today it can only buy 6,000..........using this the c.3 month inflation rate for Bitcoin is about 50% i.e. its change in purchasing power........annualized as quarterly dollar inflation rates are its about 200% inflation rate.........granted as BTC's price was rising in late 2020 into early 2021.........BTC denominated transaction were defalting as its price rose & its purchasing power increased.........point me to the last time the US dollar's or Euro's inflation rate hit 50% in quarter....you cant......it never has


----------



## Duke of Marmalade

tecate said:


> The programmatic nature of bitcoin means that its inbuilt monetary policy currently establishes a pre-determined inflation rate of 1.76% through coin issuance.


Sorry, but that is BS, to use @letitroll's technical term.  Inflation is a price phenomenon - it is a function of supply AND demand.  UK M2 money supply has increased 6 fold over the last 25 years, yet inflation over the same period has only been 50%.
The demand for bitcoin is almost entirely speculative and that is completely dwarfing any supply stability in terms of its price level.  How that is going to serve the people of El Salvador is a mystery to me.


----------



## tecate

letitroll said:


> Breez remittance app - using lightning, oracle database, bla bla whatever it says its using.........its a remittance app.....


Do you want to have an intelligent discussion or do you just want to rant and vent? As was pointed out to you, you are conflating a number of things. Breez and Phoenix are lightning network wallets that can be downloaded and used by anyone to transact bitcoin. Lightning Network is a secondary bitcoin payments layer just like visa is a payments layer that runs on top of the conventional system.
Strike is a lightning network-based payments platform at an embryonic startup stage which concerns itself largely with remittances and cross border payments.



letitroll said:


> we've been talkng about an at scale national payments system that supports 1000's of transactions a second such that it could replace cash/mastercard/visa.......


Correction. You've unsuccessfully hopped from one objection to the next and that brought you to a totally uninformed and outdated point of attack where you were'nt even aware of the existence of the lightning network payments layer. Secondly, over the course of 4 years of discussion here I have never seen anyone talk in terms of replacing cash/mastercard/visa. I have seen consideration of decentralised cryto-based alternatives being provided as a choice for ordinary people.



letitroll said:


> and you use a start up remittance app as an example of how crytpo is ready.


Correction.  You said that today, it would take 25 minutes to pay for a loaf of bread and I corrected you on your lack of knowledge on the subject. A loaf of bread can be bought with bitcoin over the lightning network with the transaction completing somewhere between a timeframe of milliseconds and 60 seconds. That's what I said. You swore blind that its not possible when it is.
Remittances are a completely separate item.  As Mallers' startup shows us, those too can be facilitated over the bitcoin-based lightning network payment layer.
With regard to throughput, visa averages around 25,000 transactions/second. It's technical limitations see it top out at 50,000 transactions/second. My understanding is that lightning network is capable of infinitely greater throughput than that. However, as I've always stated with the development of this whole sector, work is ongoing to build out the technology, its eco-system, UX, education, regulation - the list goes on.  Notwithstanding that, lighting network is at a point where it can and should be used at scale. What you're trying to suggest is that nobody should possibly consider it until its limits have been fully tested. Well, there's only one way for that to happen. What you're trying to suggest is akin to saying in 1990, nobody should dare offer anyone dial-up internet - and these tech guys shouldn't offer it to you. Let them come back to you when they have gigabit fibre.  That's what you're saying - and in no way do I agree. Lightning development has been slow - I believe that there will still be some technical challenges to be overcome as it is fully deployed but none which would stop me from using it today.  And as I mentioned to you, I have been using it.

Now if your opinion on the back of that is that i'm in 'cloud cuckoo land', know that my view is that what is as clear as night and day with your approach to this subject is that you're working backwards from your dismissal of this innovation to find whatever you can to validate your argument. And we can go round the houses all you want if that's what you want to spend time on - but I suggest we park it up right there.



letitroll said:


> @tecate the main thing I love about your post. Which give me hope that your not a complete cultist......is that you completely side stepped the substance of my 250 word post which was really Bitcoin Beach - i.e. BS Beach........and your smart and dug around that website/press section and googled the hell out of it I'm sure looking for substance & counter factuals to show its 'going great' and adoption is increasing............but there isnt any updates. I think your smart enough to have had enough doubt planted in your mind that I'm right on this one.


The flagrant ignorance on display is breathtaking. I addressed your point - and I'll do so again for clarity. Your point is that the Bitcoin Beach project is not significant in terms of scale. My point is that I never claimed any such use at scale. However, it is an active demonstration of how bitcoin can be used on a day to day basis going forward.
As regards your claims that I've 'googled the hell out of it', I think you're talking about yourself seeing as you weren't aware of it from the get go. I don't need to 'google the hell out of it' - as I've been aware of the project since its early stages. I've talked to people who have given me first hand accounts of what the project is about and what's going on there.
And yet whilst that project is embryonic, without it - there would not have been this proposal that the El Salvadoran government is now putting forward. That showcase - presumably together with what Mallers claimed his Lightning-Network based platform can bring in terms of value add as it relates to remittances - led to said proposal. Other than that, it's a credible demonstration of how ordinary people can be empowered to send/receive currency when the banking system that you say is glorious has failed them.



letitroll said:


> Its a PR stunt. Community led!!?!?! how? where you see that, cuase it said it on the site? - its led by some millionaire bitcoin fanatic who wanted to print a press release and give the Miami cult something to talk about.



It looks like you're going to continue to claim that - fine. I disagree - and going on the line you're taking (unless you have some new information), we won't be agreeing on this topic. Mike Petersen had no notion of some future conference in Miami a few years ago when he started this project. It's completely moronic to suggest such a thing. I honestly don't see ANY financial upside for him - but if you're aware of one, then please let us know.
And one other thing - on the one hand you claim that i'm furiously searching the internet re. the project and on the other its wrong because I've had friends who have given me first hand accounts with regard to the project. Are you reading your own posts - because I'd suggest you might want to review your cause for complaint!!!



letitroll said:


> you've been hoodwinked if you think there's a village right now in El Salodvor where people are running around right now paying for haircuts/groceries


Ok, so when I arrive there in November inshallah, are you saying that I won't be able to pay for anything with bitcoin? I'm scared to ask but I'll push through the fear with a follow up question. If the answer to the former is that I won't be able to buy anything with BTC, have you've based that on information that you..
A. got first hand from those with knowledge of the project
OR
B. googled the hell out of it
OR
C. received that enlightenment through a vision or some such

Apparently the first two are off limits - but maybe you have news on the last one.



letitroll said:


> Bitcoin beach is a PR stunt..........an alice (tecate) in wonderland website creation.........I showed you what was behind the curtain...... nothing......two puff piece advertorials in Jan 2020 and thats it..........you've been hoodwinked if you think there's a village right now in El Salodvor where people are running around right now paying for haircuts/groceries



Yes, we know  - a 'stunt' - the word appears on this page 10 times now but feel free to tell us again and I guess I'll come back and clarify that I disagree. Apparently you know this through one of the means outlined above. And yet, despite the project going hand in glove with the ongoing development of the lighting network, a secondary effect has been this proposal from the President to make bitcoin legal tender for the first time. Mike Petersen must be feeling awfully foolish round about now what with the effects that will have inside of and outside of the borders of El Salvador.


----------



## tecate

letitroll said:


> Dont use the word inflation, please - call it bitcoins circulating supply increases 1.76%......its more precise.......


You asked politely so I'll have the good grace to decline your invitation politely.


Duke of Marmalade said:


> Sorry, but that is BS, to use @letitroll's technical term.  Inflation is a price phenomenon - it is a function of supply AND demand.  UK M2 money supply has increased 6 fold over the last 25 years, yet inflation over the same period has only been 50%.
> The demand for bitcoin is almost entirely speculative and that is completely dwarfing any supply stability in terms of its price level.  How that is going to serve the people of El Salvador is a mystery to me.


@dukey . I was talking about inflation as it pertains to monetary policy. Bitcoin has one - it's programmed in to it - and coin issuance plays a role in that. I'm not having you confuse matters by not making the distinction. You know perfectly well that Satoshi had no earthly intention of tracking the price of the USD or any fiat currency.  Accepting that fact - and bearing in mind it is a fixed supply currency, it stands to reason that if someone looks at its value versus the reigning unit of account of the day, of course it's not going to land onto the market on day one at its final settled price.  That price will be determined when it has matured as a digital asset and as a means of exchange and maturity only happens as we progress along the adoption curve. I'm quite happy to acknowledge that price action/volatility is a feature of bitcoin and is likely to be for some years to come - but I'm not entertaining this conflation that you're going on with.


----------



## Duke of Marmalade

@tecate Inflation, conflation.  I suggest you bone up on your flations.  The first commandment of the cult seems to be Never, Never, ever, admit that you are wrong.  The *current *inflation of bitcoin is not 1.76%, as you stated, no matter what flation you use.


----------



## tecate

Duke of Marmalade said:


> The first commandment of the cult seems to be Never, Never, ever, admit that you are wrong.


And the wahhabist opposition you put up means that you'll stop at nothing (including bad faith argument) to try and sully something that has never been bad for people - choice.




Duke of Marmalade said:


> The *current *inflation of bitcoin is not 1.76%, as you stated, no matter what flation you use.



The inflation which is preprogrammed and designed in to the bitcoin protocol is 1.76%. Volatility and price action outside of that is entirely logical for a fixed supply digital asset and currency which is going through the adoption curve. You're going to extreme lengths to prevent that understanding getting out into the ether.


----------



## WolfeTone

Duke of Marmalade said:


> I chose a month


Conveniently for you. 

But the definition you cite clearly implies periods of time greater than an arbitrary month. 
In general terms, a time frame of 12 months, y-on-y, is a standard. 

Perhaps try your calculation on that basis?


----------



## Duke of Marmalade

WolfeTone said:


> Conveniently for you.
> 
> But the definition you cite clearly implies periods of time greater than an arbitrary month.
> In general terms, a time frame of 12 months, y-on-y, is a standard.
> 
> Perhaps try your calculation on that basis?


I can bet you as many bitcoins as you like that it won't come out at anywhere near 1.76% which was categorically stated by @tecate to be the *current* btc inflation rate.  Is there no limits to your subjugation to your mentor?
I would be settling the bet in € so we will need to specify the exact date and time for settlement, to avoid disputes.

What did you think of the Miami declaration of faith, as posted by @letitroll?


----------



## Duke of Marmalade

tecate said:


> The inflation which is preprogrammed and designed in to the bitcoin protocol is 1.76%. Volatility and price action outside of that is entirely logical for a fixed supply digital asset and currency which is going through the adoption curve. You're going to extreme lengths to prevent that understanding getting out into the ether.


If you had used terms like "pre-programmed" or "Satoshi intended"  then there would be no problem. The inflation rate of BTC is not as pre-intended no more than the inflation rate of fiat is as pre-intended.
This is not nitpicking.  If the El Salvadorian folk think they are buying into a 1.76% inflation rate then what about your prediction of a 80% fall in BTC/$?


----------



## tecate

Duke of Marmalade said:


> I can bet you as many bitcoins as you like that it won't come out at anywhere near 1.76%.


This came up in the context of inflation as monetary policy. with @letitroll  feeling aggrieved because he claimed BTC doesn't see another ATH without coming back and accounting for intended fiat inflation. The central bank high priests can't preprogram inflation in the same way as the bitcoin protocol hardwires it in - they have to tinker to try and achieve that.


Duke of Marmalade said:


> If you had used terms like "pre-programmed" or "Satoshi intended"  then there would be no problem. The inflation rate is not as pre-intended no more than the inflation rate of fiat is as pre-intended


I have a big problem with you claiming that Satoshi wasn't aware of the price discovery process that would unfold. @letitroll can claim something like that as clearly he's far from up to speed on the topic. However, you've delved into this topic over the course of four years and you know better. Why would he have designed in the halvings and adjustable hash rate otherwise. You can disagree with it - that's fine , but theres no way you can claim that you're not aware of it.




			
				Duke of Marmalade said:
			
		

> This is not nitpicking. If the El Salvadorian folk think they are buying into a 1.76% inflation rate then what about your prediction of a 80% fall in BTC/$?



See above.


----------



## letitroll

These posts from tecate and wolfetone have now fully devolved into the ramblings of a religious cult - its own language (inflation thats not inflation), goal posts that are constantly shifting, press releases passed off as feats of human innovation and progress - all cloaked in pseudo science, vaporware, white papers & beta products with some 3rd year economics thrown in…..turds underpinned by a little raisin (distributed ledger technology which has and will have use cases in removing current trusted third parties, settling securities instantly etc.)….all this giving a sheen of legitimacy & techno utopianism about saving poor people from dictators…..it looks and sounds like Scientology with a paddy power account attached.

I’ll stick to commenting on the price of bitcoin with you fellas there’s no point doing anything else - maybe we can all agree on the irrefutable property of numbers….BTC = $64,888 good, BTC at $30,000 not good……., BTC $8,000 really not good…..BTC $100 oh oh spagheitto


----------



## WolfeTone

Duke of Marmalade said:


> I can bet you as many bitcoins as you like that it won't come out at anywhere near 1.76% which was categorically stated by @tecate to be the *current* btc inflation rate.



You are measuring the inflation (deflation) rate against USD or Euro. 
@tecate is measuring it, as I understand it, at the rate of increasing supply. 
They are two different measurements so cannot be compared. 

To demonstrate, if I measure my € against the CPI as measured by CSO I come up with 1.6% yoy.
If I measure it against Eurostat CPI I get 1.10%
Which is correct? 
If I measure it against price of houses its around 5%.

What bitcoins inflation rate is to be measured against needs to be agreed. Then agree a timeframe.


----------



## DazedInPontoon

letitroll said:


> BTC at $30,000 not good……., BTC $8,000 really not good…


Bitcoin spending 4 straight months above 30k is pretty great progress from my point of view, considering it spent the previous 11 years well below that, or what average price were you expecting in the first half of 2021 last year?


----------



## tecate

@letitroll , The only commentary that first rambling rant of a paragraph deserves is to make it clear that you've switched from one bad faith argument to the next, and the next, etc. , in order to find a way to work back to the  original decision you made way back when to dismiss any notion of decentralised crypto. On that basis, its poor form to resort to the 'cult' tar and feathering. The greater irony of course is
that the cult like behaviour is thus demonstrated on your part . Presumably you attended the same Wahhabi school as his dukeness.




letitroll said:


> I’ll stick to commenting on the price of bitcoin with you fellas there’s no point doing anything else - maybe we can all agree on the irrefutable property of numbers….BTC = $64,888 good, BTC at $30,000 not good……., BTC $8,000 really not good…..BTC $100 oh oh spagheitto


Apart from our differing predictions, I'm not sure how you believe that $30,000 is not good. Ask his Dukeness if he considers $30,000 bad for an asset he believes is worth nothing - and one that he reminded everyone repeatedly over the course of 3 years that it would never see $20,000 ever again. As for $100, you can only dream my dear @letitroll .


----------



## letitroll

Inflation is a decrease of purchasing power for real world goods and services for a given unit of a monetary instrument - FFS lads…..it isn’t that hard lads…your scaring me…….if its two sea shells (monetary instrument) to buy one cow (real world item) one year…..and a year later it costs four sea shells to buy the same cow……..the inflation rate is 100% in sea shells


----------



## WolfeTone

Duke of Marmalade said:


> What did you think of the Miami declaration of faith, as posted by @letitroll?



If its the max Keiser part then this is nothing short of what he has been doing for 10yrs+ Keiser is somewhat eccentric and prone to dramatic outbursts that make for great entertainment. 
He is also highly articulate and more than capable of cutting through the garb. 

Here he is in more reserved form amongst more familiar company, again he steals the show. 

Kilkenomics 2012


----------



## tecate

@Wolfie: the issue is that Dukey wants to gloss over the lot and not make the distinction between the two as it better suits his narrative. If he said simply that outside of its baked in inflation, bitcoin suffers from volatility, then that's reasonable. Even though I believe without doubt he knows well the reason why bitcoin needs to go through this multi-year period of volatility, he didn't have to acknowledge that.
It's bad faith argument, pure and simple.


----------



## letitroll

tecate said:


> I'm not sure how you believe that $30,000 is not good.



SERIOUSLY -your going to make me type it out…………..say that with a straight face to people who bought BTC at $64,888….what a little less than 8 weeks ago….with it dropping to $30k…..thats a 52% loss of purchasing power……or a 52% BTC inflation rate in just 8 WEEKS!!…..a 12 MONTH total 2% inflation rate in fiat dont seem so bad now?


----------



## WolfeTone

letitroll said:


> say that with a straight face to people who bought BTC at $64,888….



It's a simple fact that everyone who has bought and held bitcoin ANYTIME in the last 11yrs, aside from the 8 week window you refer to, is in positive territory on their holding. 
There is simply no comparison between a 34,000% increase over 11 yrs versus a 50% decline in 8 weeks. 
If, IF, you happen to be someone who bought for the first time at the peak, and 8 weeks later you are 50% down then that is unfortunate. But if you are buying bitcoin in 2021 and are not aware of its volatility, not aware of all the FUD then what can one say? 
If on the other hand you did buy bitcoin for the first time in its decade + existence at the $64,000 peak AND  you were AWARE of its volatility, the FUD etc, then what?...should we shed some tears? Boo-hoo!  
Or why not, with a straight face, tell people to grow a pair and take responsibility for what they choose to do with their own money?


----------



## letitroll

Excuses, excuses, excuses - as mentioned I'll be focusing on the price with you guys from now on and look forward to my thesis playing out *in the price* in the next 12 months & beyond...................hopefully we can agree that the price of BTC in USD listed publicly on Coinbase is the ultimate bell weather for this discussion we're having. You're entitled to your own opinion, but not your own price quote. Look forward to visiting as the road twists and turns ahead. Hope you both stay lucky and if your're both as committed as you sound on here. I hope you're able to trade around this thing such that your purchasing power & financial health is a good as or better than it is now. Chat soon.


----------



## tecate

letitroll said:


> Inflation is a decrease of purchasing power for real world goods and services for a given unit of a monetary instrument - FFS lads…..it isn’t that hard lads…your scaring me…….if its two sea shells (monetary instrument) to buy one cow (real world item) one year…..and a year later it costs four sea shells to buy the same cow……..the inflation rate is 100% in sea shells


I didn't even go there as I wanted to tackle Dukey's smoke and mirror routine - but Wolfie had the two of you bang to rights. Even the Wahhabi high priest Roubini wouldn't dare suggest that bitcoin is inflationary! - he'd be moaning about it being largely deflationary.



letitroll said:


> SERIOUSLY -your going to make me type it out…………..say that with a straight face to people who bought BTC at $64,888….what a little less than 8 weeks ago….with it dropping to $30k…..thats a 52% loss of purchasing power……or a 52% BTC inflation rate in just 8 WEEKS!!…..a 12 MONTH total 2% inflation rate in fiat dont seem so bad now?


Wolfie has already called you out on this - and I'm doing the same. Over the course of three years of discussion, we had his Dukeness and others cherry picking the market tops and aping at it. If you want to go year on year - 1 Jan to 1 Jan - fine. I think we've probably got another 6 months + in this bull market. When it ends, I'll be pulling you up on that nonsense. On average - year on year - bitcoin has appreciated over 200% pa since its foundation.
As regards the feigned concern for those who bought at the very peak, I'm not having any of it. You couldn't give a fiddlers about them - lets be honest. People make their own decisions in this life and they should live with them. Secondly, the majority of folk in at that top were those who were in with leverage. 90% of leveraged trades are losers. All those guys are doing is distorting the market for the rest of us. If anyone else went in without leverage, I would assume that they sized their position to a level they were comfortable with. It would also be wise if they're dollar cost averaging. If not, that's on them. If they aped in following Elon and aped out following Elon, then they did so without a full understanding of what they were investing in. Again, that's on them.
The bitcoin market is a market that trades without safety breaks (as happens with stock markets) and it trades 24/7 - 365. There is no Fed buying/selling bonds or stocks , etc - and influencing the market in that way. The market suffered a major shock the other week and stood up to it just fine. There are no bailouts in crypto. People can take it or leave it on that basis.



letitroll said:


> hopefully we can agree that the price of BTC in USD listed publicly on Coinbase is the ultimate bell weather for this discussion we're having. You're entitled to your own opinion, but not your own price quote.



Back up the bus. I spent a lot longer with this today than I wanted - so I'm not in any humour to give you a free pass. There are two options. You take the average ATH price - as is widely available online....OR...you go with the leading exchange in terms of ATH in April and the next market top (whether that be Coinbase or another exchange next time). This is not like centralised markets - there is no one point of reference for pricing. You can pick either - I don't mind - but you're not having it both ways.


This TV show snippet from 1995 is pertinent to this ongoing discussion...


----------



## Duke of Marmalade

WolfeTone said:


> You are measuring the inflation (deflation) rate against USD or Euro.
> @tecate is measuring it, as I understand it, at the rate of increasing supply.
> They are two different measurements so cannot be compared.


This is getting so silly.  Of course they are two different measurements. @tecate called his inflation which it patently is not, see Investopedia definition.  Neither of you are going to admit the error so I will leave it at that and spare your blushes.
Bitcoin had deflation of near enough 100% p.a. from its purchase of pizza at 5000 a piece until its ATH.  It has had 200% p.a.  inflation since then. (BTW nothing to do with USD but measured against price of pizzas in bitcoin)
@tecate shrugs this off as a “voyage of price discovery” which he says has still a long way to play out. Maybe @tecate is enjoying the roller coaster thrills and spills but  I ask you do you think it is right to cheerlead the poor people of El Salvador, and they are poor, on to this voyage In the middle of its roller coaster phase?


----------



## WolfeTone

Duke of Marmalade said:


> but I ask you do you think it is right to cheerlead the poor people of El Salvador, and they are poor, on to this voyage?



Ok, I think is a pertinent question to ask. You are correct that El Salvadorians are a poor people, mostly.
But why are they poor, why does poverty seem to reign in perpetuity?
@letitroll likes to inform us that bitcoins only case use is for ransomware, while simultaneously posting pictures of El Salvadorians locked up by their government after being kidnapped.
What sort of bankrupt, failed system perpetuates poverty amongst its people to the point that its central authorities need to sweep (kidnap) them from the streets?
To begin with, a system that has marginalised, stigmatised and effectively disenfranchised its people from the political, economic and financial fabric of that country.

I'm not suggesting for a nano-second that bitcoin is the panecea to all of this. But what it may do, if some are willing to engage, is for the first time probably in their lives offer poor people a stake on property. It is digital property, but it is their stake. This is psychologically very important. It is something that the financial and political world has failed derisorily to do generation after generation - offer them a stake in society.

@letitroll wants us to believe that the fiat system has coincided with the greatest advancement in living standard in the history of human kind. Many of us here can testify to that. But try telling that with a straight face to the El Salvadorians holed up in over-crowded prisons. For the age old crime of poverty. Some advancement! 

So there are risks for poor people in El Salvador getting involved in bitcoin. But how much poorer will they be if bitcoin returns to zero than had they not involved?
On the other hand, if bitcoin shoots for the stars, then imagine for the first time in history poor people having some leverage for their own well-being and affairs.

The alternative, not buying bitcoin, seems to say to El Salvadorians - you are poor, you will stay poor, and as unfortunate as that is, that is the way it is and will be.


----------



## Duke of Marmalade

@WolfeTone So the poor people of El Salvador have nothing to lose, so why not have a punt on bitcoin? Is that your financial advice? Sadly, this lotto mentality exists here in Ireland where it is known that the most avid lotto enthusiasts come from the poorer sections of society.  Are you suggesting that they too should diversify somewhat into bitcoin?

As to who would be mug enough to buy bitcoin at its ATH given all the FUD, I seem to recall a contributor to AAM getting very hot and steamy when it hit $60k.

Note that daily turnover in btc is $10bn.  So in the 8 weeks since ATH the entire market cap has turned over.  It is not implausible that the majority of today's bitcoin holdings are standing at a loss.  This looks like the ultimate Ponzi scheme.  When the music stops very few of those caught in the headlights will have made money on bitcoin.


----------



## WolfeTone

Duke of Marmalade said:


> so why not have a punt on bitcoin.



Except its not really lotto-esque is it? 
I bought my €2.50 euro millions for the Bank Holiday weekend on Friday. Its prospective value of €130m crashed to zero by 9pm that day. Never to return to its all time high of €2.50. 
It's BOHA now. 
Bitcoin, on the other hand, has a negative return for 8 weeks out of last 11yrs. 
There is simply no comparison.


----------



## Duke of Marmalade

WolfeTone said:


> Except its not really lotto-esque is it?


Your advice to poor El Salvadorians that "what have you got to lose and who knows it could be you", is very lotto-esque.


----------



## WolfeTone

Duke of Marmalade said:


> Your advice to poor El Salvadorians that "what have you got to lose and who knows it could be you", is very lotto-esque.



Yeh, if you apply it in such a simplified context. 
You could say the same about stocks, property, gold, or any other asset class. But we know the value of such asset classes do not generally expire at the close of business. 
We also know that is the same for bitcoin.


----------



## Cavanbhoy

I thought you all would have called a truce today now that the pubs are opened!!


----------



## Duke of Marmalade

Cavanbhoy said:


> I thought you all would have called a truce today now that the pubs are opened!!


I was actually on a truce.  But then they invaded El Salvador


----------



## tecate

Duke of Marmalade said:


> This is getting so silly.  Of course they are two different measurements. @tecate called his inflation which it patently is not, see Investopedia definition.  Neither of you are going to admit the error so I will leave it at that and spare your blushes.


Dukey, you know perfectly well that what you started with was disingenuous.  You know perfectly well that the point you picked this up at was a discussion of pre-programmed-in inflation in the case of bitcoin's monetary policy and intended inflation as part of fiat monetary policy.
Not only did you not explain the difference with what you bolted on to that - but you are then cherry picking market tops and bottoms and timeframes to suit. That's not on. On average, bitcoin's buying power has increased at a rate of 200%+ per year - over the course of its existence.



Duke of Marmalade said:


> @tecate shrugs this off as a “voyage of price discovery” which he says has still a long way to play out.


Others might not understand it but I know well that you do - as you've spent four years on the topic. So lets go through it. Step into Satoshi's shoes. You have a decentralised currency - you're not going to peg it to the USD  - as that's going to completely defeat the purpose. You're not going to back it or peg it to a commodity - as again, that's going to leave it prone to centralisation, manipulation and control. You release it to the world as a decentralised fixed supply currency. The finite supply is unrivaled by any other financial asset but at that embryonic point, it's just code - nobody has any appreciation for it. Furthermore, you want to ensure that distribution is fair upon initial issuance. So - it's effectively given away in return for mining.
Now, explain to us how there can be any other route to its maturity other than a multi-year process of price discovery that is directly related to adoption - and thus, demand? Tell us how this could have been done differently please?
I'm quite happy to acknowledge that its volatility is a major bug bear. However, you're trying to suggest that there's no logic to it. If that's the case, then step up and explain what he/she/they should have done differently please.



Duke of Marmalade said:


> It is not implausible that the majority of today's bitcoin holdings are standing at a loss. This looks like the ultimate Ponzi scheme. When the music stops very few of those caught in the headlights will have made money on bitcoin.


There's a couple of things here. You've fallen foul of this before. Over the course of three years, you constantly referred to the market top of $20,000 and the poor hapless craturs (someone please think of the children!) that bought at the top. Well, was all of that commentary for nothing? If so, who's to say that what you're going on with right now is also for nothing?
Secondly, between where we are right now and $60,000, it seems like a lot of that can be accounted for by leveraged traders. I don't have a grain of sympathy for them. All they do is distort the market for the rest of us. Next up, you and others here have moaned about Elon moving the market. Well, you can't have it both ways. These are the people that both aped in and aped out of the market based on Elon's tweets!
If someone bought high but wasn't greedy and sized their position correctly, they're not going to be wiped out. Furthermore, if they've weighed this up and have a level of conviction in it, they have the option of maintaining their position.
Lastly, nobody is holding a gun to anyone's head. People have the choice to do what they want. However, they have to take personal responsibility for their choices.



Duke of Marmalade said:


> Your advice to poor El Salvadorians that "what have you got to lose and who knows it could be you", is very lotto-esque.
> Maybe @tecate is enjoying the roller coaster thrills and spills but  I ask you do you think it is right to cheerlead the poor people of El Salvador, and they are poor, on to this voyage In the middle of its roller coaster phase?


Turning to the battle for San Salvador...
It's kind of on the same lines. They're still going to be using dollars. The difference is that should they find a need or a use case to use bitcoin, they can. What could possibly be wrong with that? Should they not be free to make up their own minds? 70% of them don't have bank accounts because the banking system has failed them. They all have family in the US sending money back home. They're being screwed royally on remittances. So maybe they use a bitcoin-based solution?  Surely, you can't be opposed to that?

There's a whole host of reasons why this could possibly be a savvy move for El Salvador and far from the 'stunt' that @letitroll claimed. The following is a long form medium post on the subject - it's the best piece of analysis I've seen on this so far and I'd recommend it to anyone who is interested in this decision by El Salvador.

El Salvador, Dollarisation, and Bitcoin — What to Expect From Here

And yes, the guy comes from a pro-btc viewpoint. However, much of what he raises is insightful - so there's value in it regardless of what views you approach it with.


----------



## Duke of Marmalade

tecate said:


> Dukey, you know perfectly well that what you started with was disingenuous.  You know perfectly well that the point you picked this up at was a discussion of pre-programmed-in inflation in the case of bitcoin's monetary policy and intended inflation as part of fiat monetary policy.
> Not only did you not explain the difference with what you bolted on to that - but you are then cherry picking market tops and bottoms and timeframes to suit. That's not on. On average, bitcoin's buying power has increased at a rate of 200%+ per year - over the course of its existence.


Disingenuous?  Playing a "gotcha"?  Maybe.  Inflation is an interplay between the supply *and demand *for money in terms of its utility which is usually as a medium of exchange.  It is an interesting subject in its own right but I will not pursue it further here.  I calculate the increase in btc purchasing power in terms of pizzas at over 400% p.a. which, as I said, is to all intents a deflation of 100% p.a.


tecate said:


> Now, explain to us how there can be any other route to its maturity other than a multi-year process of price discovery that is directly related to adoption - and thus, demand? Tell us how this could have been done differently please?


I was questioning the cheerleading of poor El Salvadorians on to the roller coaster, long before it reaches maturity.


tecate said:


> There's a couple of things here. You've fallen foul of this before. Over the course of three years, you constantly referred to the market top of $20,000


I admit that I have been on balance spectacularly wrong on the voyage of price discovery but my day will come


tecate said:


> El Salvador, Dollarisation, and Bitcoin — What to Expect From Here


As you say, written with a heavy genuflection to the cult. But partly informative for all that.  A few takeaways to support the Satanic (or is it Wahaabi'ist) view.
_Lightning network _- I am not at all au fait with the micro working of Lightning but @letitroll seems far from convinced.  Neither does the link which suggests that El Salvadorians are in for a "trial by fire" on this one.  This on top of the roller coaster ride.  Do they really deserve this?

_This will lead to a big boost in foreign investment into EL Sal.  _Bukele mused that only 1% of btc market cap would increase El Sal GDP by 25%.  Economists have already dismissed this populist's amateur economics as nonsense.  The link suggests that making bitcoin legal tender will make it free of CGT and that will boost investment.  I was not convinced.

The link hails this as the "greatest development ever" for bitcoin but also notes that btc will "sink or swim" as a result of this move.  I think it will have game changing effects, already has, just as El Musk had, but my money (in €) would be that this will so not deliver that it will bring forward BOHA day.  For example,  let's say that it is "successful" in it immediate stated purpose and the poor people of El Sal become awash with btc and then it falls to that ATH-80% that you predict, the outcry world wide at the "monetary rape" of a poor nation will be deafening. 
Bitcoin is down over 15% since the announcement which the link describes as "moving sideways" which I suppose in terms of the current roller-coaster phase of the "voyage of price discovery" is an accurate description.

Finally the link makes a big play of "seigniorage" which it portrays as the US grabbing a lot of EL Sal product by issuing dollars that cost them nothing.  This is a grotesque misrepresentation.  El Sal are not compelled to hold US$.  They can switch it for gold or more importantly they can switch it for goods and services at any time of their choosing - this is a debt from the US government, not a mere digital entry on the Fed's ledger.  The solution to this seigniorage pillage?  El Sal should get into bitcoin mining, before the end of this epoch of course (epoch ends at next halving,  just like the Bible the cult has its own astrophysical terminology).  Givus a break!


----------



## tecate

Duke of Marmalade said:


> Disingenuous?  Playing a "gotcha"?  Maybe.  Inflation is an interplay between the supply *and demand *for money in terms of its utility which is usually as a medium of exchange.  It is an interesting subject in its own right but I will not pursue it further here.  I calculate the increase in btc purchasing power in terms of pizzas at over 400% p.a. which, as I said, is to all intents a deflation of 100% p.a.


Like I said, on average bitcoin's buying power has increased 200%+ per year since its release.



Duke of Marmalade said:


> I was questioning the cheerleading of poor El Salvadorians on to the roller coaster, long before it reaches maturity.


I'll take your lack of a response to mean that you understand well why bitcoin has to be volatile over the next few years and that you have no suggestion as to how Satoshi could have designed the digital currency such that this wouldn't be a transitional feature. 



Duke of Marmalade said:


> _Lightning network _- I am not at all au fait with the micro working of Lightning but @letitroll seems far from convinced.  Neither does the link which suggests that El Salvadorians are in for a "trial by fire" on this one.  This on top of the roller coaster ride.  Do they really deserve this?


@letitroll wasn't even aware of its existence so hard to fathom how his opinion on it matters. Other than that, he's referring to its use at scale - and there's only ever one way in reality to put that to the test. If we were to take your view, then nothing would ever be put into production. As I write this, an email has just hit my inbox with a notification that Bottlepay - a lightning network-based payments app similar to Mallers' Strike but based out of the UK - has just gone live - facilitating instant Euro/GBP to BTC payments.
As for the 'do they really deserve this' query - you're asking do Salvadoreans deserve choice? I would say that we all deserve choice and they're going to be further on than the rest of us which is a hell of a turn around given that today, the conventional banking system has shut the door on their faces.




Duke of Marmalade said:


> The link hails this as the "greatest development ever" for bitcoin but also notes that btc will "sink or swim" as a result of this move.  I think it will have game changing effects, already has, just as El Musk had, but my money (in €) would be that this will so not deliver that it will bring forward BOHA day.  For example,  let's say that it is "successful" in it immediate stated purpose and the poor people of El Sal become awash with btc and then it falls to that ATH-80% that you predict, the outcry world wide at the "monetary rape" of a poor nation will be deafening.


"Monetary rape" Duke, really?  Is this why the banking system has turned their noses up at them  - they don't want to 'monetarily rape them'? You've defaulted back to cherrypicking market tops and shorter term timelines  when its proven that over the course of its 12 odd years or so, bitcoin has appreciated by 200%+ pa.



Duke of Marmalade said:


> Bitcoin is down over 15% since the announcement which the link describes as "moving sideways" which I suppose in terms of the current roller-coaster phase of the "voyage of price discovery" is an accurate description.



And once again, you're using volatility as a crutch - even though you completely side-stepped a discussion of why its necessary - and couldn't even begin to suggest why it isn't necessary or how it could be avoided as a transitional feature of the bitcoin protocol.



Duke of Marmalade said:


> Finally the link makes a big play of "seigniorage" which it portrays as the US grabbing a lot of EL Sal product by issuing dollars that cost them nothing.  This is a grotesque misrepresentation.  El Sal are not compelled to hold US$.  They can switch it for gold or more importantly they can switch it for goods and services at any time of their choosing - this is a debt from the US government, not a mere digital entry on the Fed's ledger.  The solution to this seigniorage pillage?


There is no 'grotesque misrepresentation'. He simply outlines the pro's and con's - of which seigniorage is one.



Duke of Marmalade said:


> El Sal should get into bitcoin mining, before the end of this epoch of course (epoch ends at next halving,  just like the Bible the cult has its own astrophysical terminology).  Givus a break!


Insert 'old man yells at cloud' meme.


----------



## Duke of Marmalade

tecate said:


> I'll take your lack of a response to mean that you understand well why bitcoin has to be volatile over the next few years and that you have no suggestion as to how Satoshi could have designed the digital currency such that this wouldn't be a transitional feature.


If I can get past why a BOHA should have a price at all, I can surely understand why it has to be volatile.  As it happens bitcoin has achieved a price - a  truly unbelievable price - which has no backing at all except speculation and pump.  No surprise that that is a volatile cocktail.
I am sure there are those who can point to where Satoshi, with the benefit of hindsight, would have tweaked things.  To the cultists would that be like suggesting that God could maybe have done somethings a little differently during the 6 days when he created the universe?


----------



## tecate

@dukey : So I asked you how it could have been designed so that it doesn't have to go through a transitory phase of high volatility and you have no suggestion. Understood.


----------



## DublinHead54

@tecate How was Bitcoin designed to ensure that the phase of high volatility is only transitory? If it was designed to be transitory, can you let us know when the volatility will end?


----------



## letitroll

Wether you agree or disagree with Fareed’s position (I of course echoed these thoughts weeks ago & agree) - this idea making it to the top of Fareed Zakira & GPS’s show opening is an indicator that this position is now the consensus position in the United States….needless to say Fareed mirrors and is watched by the Washington, DC political liberal elite……who are in case you havent noticed back in control of the White House and Congress.

This is bearish for Bitcoin, very bearish. The USA establishment is coming after this space with all its tools IRS, SEC, DOJ & FED. We’ll see what the underlying demand is once the speculators and criminals are driven out of the BTC sinking ship in the coming months.


----------



## WolfeTone

letitroll said:


> We’ll see what the underlying demand is once the speculators and criminals are driven out of the BTC sinking ship in the coming months.



Im not sure why you consider speculators are to be 'driven out'? 

As for criminals, if they are to be driven out then I would expect the price of Bitcoin to soar. The association of bitcoin with criminal activity is, I suspect, one reason for those unsure about it not to engage with it. Remove that association and more people will become more comfortable with it.


----------



## tecate

letitroll said:


> Wether you agree or disagree with Fareed’s position (I of course echoed these thoughts weeks ago & agree) - this idea making it to the top of Fareed Zakira & GPS’s show opening is an indicator that this position is now the consensus position in the United States….needless to say Fareed mirrors and is watched by the Washington, DC political liberal elite……who are in case you havent noticed back in control of the White House and Congress.
> 
> This is bearish for Bitcoin, very bearish. The USA establishment is coming after this space with all its tools IRS, SEC, DOJ & FED. We’ll see what the underlying demand is once the speculators and criminals are driven out of the BTC sinking ship in the coming months.


The piece that you're referring to provides evidence as to why they're unlikely to do a full court press re. crypto. Did it escape your attention that they recovered a substantial chunk of the $? That only became possible due to the nature of bitcoin's public blockchain. It's a dream for law enforcement.
Like you, Fareed claims that bitcoin brings nothing. It's the same tired old story - start with that wayward premise and work back to arrive at further wayward conclusions.
The US got the upper hand on everyone in the last wave of innovation. They're not going to lose out this time round either. This isn't just about bitcoin but decentralised crypto in general. Start banning the hell out of it and all that innovation will take off somewhere else. Is there further regulation coming? Of course there is. Will they try and strangle it? I don't believe they will. Following Wyoming's lead, last week Texas became the latest state to provide clarification re. crypto - to facilitate State banks in custodying it. In New York an anti-crypto mining ban bill died a death when the Electrical Workers Union called bs on the misguided premise of the bill. An update to the bitcoin protocol (taproot) was locked-in this past weekend - meaning greater privacy for lightning network transactions and greater ability to build smart contracts on top of the bitcoin network.
As regards the bearish warning - over the longer term I remain more bullish than ever. There may possibly be temporary setbacks but when you zoom out, whats evident is that year on year bitcoin continues to progress.


----------



## WolfeTone

tecate said:


> That only became possible due to the nature of bitcoin's public blockchain. It's a dream for law enforcement.



That's my sentiment also. @letitroll likes to portray bitcoin price as some consequence that is predominantly generated by criminality. 
The main purpose of criminality is to enrich oneself with $$ not bitcoin. 

So non criminal holders of bitcoin like myself, tracing my crypto activity is child's play. Money transfers from my bank account to a crypto exchange. This transfer is date times and stamped. If six months later another transfer occurs, this time from the exchange to my bank account it does not take a rocket scientist to figure out what just happened. 

As to how criminals circumvent this tracing of cashing out bitcoin for cash I do not know. I suspect most people don't know either, which belies @letitroll notion that bitcoin price is predominantly driven by criminal activity.


----------



## letitroll

It doesn’t matter what you or i think. Hell it doesn’t if matter what’s true or not. What matters is what the people in power think/do and what they think is what Fareed is articulating. Ultra bearish for BTC in short to medium term.


----------



## tecate

letitroll said:


> It doesn’t matter what you or i think. Hell it doesn’t if matter what’s true or not. What matters is what the people in power think/do and what they think is what Fareed is articulating. Ultra bearish for BTC in short to medium term.


There's a certain logic to that i.e. it doesn't matter what you or I think. I'll give you that. 

However, let me just say something about the 'main stream media' that Fareed is very much a part of. I hated everything about the yanks previous administration yet I hate to admit that they were right to call out the main stream media (even if what they called them out on specifically a lot of the time were the wrong things). Today we had a bitcoin 'opinion' piece in the NYT from some clown from Cornell who trotted out what you trotted out the other week i.e. bitcoin transactions cost too much and they're too slow. You had an excuse - in that you got your information from clowns like him. He knows better - and didn't even mention lightning network. The Economist did exactly the same thing a couple of days beforehand. Then we had the BBC last week seek comment from someone who's representative of a bitcoin clone project rather than bitcoin core. Whilst they edited their article once the pressure came on them, it's not good enough from sources that we've all been led to believe for donkeys years to be authoritative. All this to say that sure these still are authoritative - but their influence is going one direction and one direction only. Among a younger demographic, they don't rate them - not in any way, shape or form. All that to say - that I couldn't give a toss about Fareed's view. I feel sorry for anyone who doesn't know any better and is hoodwinked into consuming their content unquestioningly. 

Now getting to the powers that be. First off, the SEC set out their program for the rest of the year today and bitcoin/crypto doesn't feature - so there's that. Granted, multiple agencies are implicated so it doesn't mean that there still can't be something but it won't come from the SEC. There are plenty of things that a government can do - but it's another thing entirely as regards whether it makes any sense. That brings us all the way back to the same discussion. You don't think there's anything in this and I believe the complete opposite. 
Back in 1991, the law had to be changed in the US to actually make it legal for people to use/access the internet. Imagine if they didn't change that? They won't be able to neuter bitcoin without neutering all decentralised crypto - and when they do that, those innovators - who are more mobile now than ever before - will simply up sticks and leave the US - simple as that. There's no way they will pull the trigger. I think the Europeans are culturally more likely to want to do that - but it must be playing on their minds how Europe fared vs. the US in the last innovative wave. 

So getting right back to where we started, of course it doesn't matter what we think in terms of how things play out. However, we have differing interpretations of what's likely to happen. Yours is an extremely bearish view re. bitcoin. Mine is a guarded bullish view (guarded in that we may have some setbacks - but I still believe that it will continue to develop over the longer haul). Opinions are two a penny - but I guess we'll get to find out soon enough.

On another note, you've joined this discussion more recently but one of the key moments in 2020 relative to bitcoin was Paul Tudor Jones' investors letter - where he set out the case to take a small position in bitcoin. Earlier today, he set out the rationale as to why he's now moved from a 1% position to 5%.
stating:

_"Bitcoin is math. And math has been around for thousands of years.  Two plus two is going to equal four and it will for the next 2,000 years. I like the idea of investing in something that’s reliable, consistent, honest, and a hundred percent certain.”_


----------



## letitroll

Paul Tudor Jones is not the President of the United States, Fed Chair, SEC Chairman or sits on the congressional committees for banking & finance. I’m not interested, even remotely, in what he says/does or thinks about bitcoin.


----------



## WolfeTone

letitroll said:


> It doesn’t matter what you or i think.



Well it does, otherwise why are we here at all? 



letitroll said:


> What matters is what *some* of the people in power think/do and what *some of them *think is what Fareed is articulating.



Corrected that for you. 
At the moment, most of those articulating Fareeds views is broadly based on assumption, indicative reports, etc. There is plenty others to counter these views. 

The criminality FUD will be countered by measures to make bitcoin transactions from and into $$ more transparent. I don't see anything wrong with this, I welcome it. I will provide more assurance to the public at large who otherwise may be inclined to stay away from bitcoin. 

As El Salvador is showing, the energy FUD can be countered by tapping into the vast untapped clean renewable energy resources of the planet. 




letitroll said:


> Ultra bearish for BTC in short to medium term.



I am bearish about bitcoin for the short term. I recognise alot of the hyperbole is just that, I recognise that there will be concerted efforts to 'crush' bitcoin. Ultimately I think they will fail once the FUD dissipates, again. 

Speaking of being bearish in short to medium term, I would have thought that is a somewhat different outlook to 'crush' bitcoin? 
Have you changed your view already?


----------



## WolfeTone

letitroll said:


> Paul Tudor Jones is not the President of the United States, Fed Chair, SEC Chairman or sits on the congressional committees for banking & finance. I’m not interested, even remotely, in what he says/does or thinks about bitcoin.



You may not be interested but I would hazard a guess that the President of the US, Fed Chair, SEC Chairperson, congressional committees are certainly interested in what he, and other wealthy investors, entrepreneurs, tech innovators etc have to say.


----------



## Duke of Marmalade

PTJ said:
			
		

> _"Bitcoin is math. And math has been around for thousands of years. Two plus two is going to equal four and it will for the next 2,000 years. I like the idea of investing in something that’s reliable, consistent, honest, and a hundred percent certain.”_



What a loada baloney.
Bitcoin is math - yeah, it solves very complex mathematical equations, we know the hype.
_"_Reliable, consistent and 100% certain"  I nearly spilt my latte.  The guy must mean something - I suppose he is referring to the blockchain as a physical entity.  If someone asks me should they buy bitcoin they are not asking me about its qualities as a technology.  They are asking about it virtues as an investment/asset.  I trust that even @tecate and @WolfeTone would not describe it as "reliable, consistent and 100% certain".
I forgot "honest".  Seriously.  Bitcoin now has human virtues, why not throw in "loving and caring".
PTJ holds 5% of his assets in bitcoin.  Does he, has anybody, cautioned the poor people of El Sal to hold no more than 5% of their assets in bitcoin?

@WolfeTone you seem pretty convinced that criminals would want to offload their btc for US$ asap, and I agree with you, tells a story doesn't it?  Interesting that Bukele seems to be encouraging his poor people to go the other way and get outa US$ into btc.


----------



## WolfeTone

Duke of Marmalade said:


> you seem pretty convinced that criminals would want to offload their btc for US$ asap, and I agree with you, tells a story doesn't it?



It tells a story for sure, whether it's the same story that we share I doubt it.
I'm of the view that the higher demand for bitcoin, the higher the price. @letitroll wants to tell us all that bitcoin is predominantly criminal enterprising. Simultaneously, with bitcoin having no use (other than criminal enterprise) the logic, as you seem to agree, is that bitcoin price is pushed downward as criminals offload into $$.
Bitcoin price from zero to $35,000 makes little sense if it is predominantly criminals acquiring it and offloading it into $$.
That's is just a simple mathematical observation.
Another simple mathematical observation is what PTJ referenced.
2+2= 4. Always has done, always will. Its not complicated math, but it is certain.

Some more simple maths. I wonder if the cyber criminals ever figured that demanding 60,000 BTC @ $1 was the same as demanding 1BTC @ $60,000?


----------



## Duke of Marmalade

@WolfeTone I think that criminal activity and the recent high profile ransomware explosion has given btc some credibility.   You seem to think the opposite that it sullies the reputation of the poor "honest" crypto.  Bank robbers never had that effect on fiat.
But I agree with you that its criminal utility is a very small part of its $40k price, the rapid turnaround into something the criminals can spend would suggest an almost neutral contribution.
The price, and utility for that matter, of btc is these days almost entirely as a speculative vehicle with the likes of El Musk holding a very strong hand in the casino.
Do you agree with PTJ that bitcoin as an investment (he is an investor) should be regarded as _ reliable, consistent, honest, and a hundred percent certain?_  If yes I would be interested in you citing me examples of its honesty, for example.


----------



## WolfeTone

Duke of Marmalade said:


> Do you agree with PTJ that bitcoin as an investment (he is an investor) should be regarded as _ reliable, consistent, honest, and a hundred percent certain?_ If yes I would be interested in you citing me examples of its honesty, for example.



What he is referring to its structure, trustless, 21million coins, etc....While theoretically the rules can change, in practice it is of such extreme remoteness that it will unlikely ever occur.
He cleverly avoids giving price speculations, rather suggests 5% of his portfolio to bitcoin as a hedge against the dollar. It is pointless making price predictions because nobody knows what the price of Bitcoin will be this time next year anymore than they know what the price of their house or their stock portfolio will be.


----------



## tecate

Duke of Marmalade said:


> Bitcoin is math - yeah, it solves very complex mathematical equations, we know the hype.


Your claim of 'hype' has been outed. The 'complex mathematical equation' phrase doesn't originate from those involved with bitcoin. Secondly, it appears that only those who engage in mathematical snobbery would be bothered - right Duke? The equations are not the point - they're a means to an end.



Duke of Marmalade said:


> _"_Reliable, consistent and 100% certain"


I'm pretty sure you know this already but he's referring to bitcoin's pre-programmed monetary policy - that isn't subject to tampering as opposed to central bank monetary policy - that's at the whims of your central bank high priests.



Duke of Marmalade said:


> If someone asks me should they buy bitcoin they are not asking me about its qualities as a technology.  They are asking about it virtues as an investment/asset.  I trust that even @tecate and @WolfeTone would not describe it as "reliable, consistent and 100% certain".



Tudor Jones isn't asking you for your assessment of bitcoin's virtues as an investment asset. Whilst describing himself as extremely risk averse, he's made that assessment without your input. Clearly, he's referring to bitcoin's consistent monetary policy that isn't going to be tampered with. He's suggesting we can't make the same assumption with fiat money.



Duke of Marmalade said:


> Interesting that Bukele seems to be encouraging his poor people to go the other way and get outa US$ into btc.


Except that he's not doing any such thing. He's offering his people - 70% of whom have been locked out of the banking system that you've told us over the past four years is the best thing since sliced pan - the choice of using it should they have a need to do so. He's also encouraging inward investment by offering that choice. Nothing more than that.



Duke of Marmalade said:


> Do you agree with PTJ that bitcoin as an investment (he is an investor) should be regarded as _ reliable, consistent, honest, and a hundred percent certain?_  If yes I would be interested in you citing me examples of its honesty, for example.


As bitcoin is a protocol, your question defies logic. However, what I can do is provide you with examples of dishonesty relative to central banking. In the lead up to the 2008 financial crisis, we had the Fed's Ben Bernanke and the Treasury Secretary lying about containment of the problem - knowing all the while that wasn't going to be the case. That's one example. But Tudor Jones has been considering inflation risk.

"The most important thing to remember is that inflation is not an act of God, that inflation is not a catastrophe of the elements or a disease that comes like the plague. Inflation is a policy." – Ludwig von Mises

Bitcoin's monetary policy is transparent and baked in. All participants/stakeholders know from the outset what it is. That's what Tudor Jones is referring to when he talks about bitcoin being math and being reliable/consistent/honest/100% certain. The same can't be said of your central bank high priests.


----------



## tecate

letitroll said:


> I’m not interested, even remotely, in what he says/does or thinks about bitcoin.


That was silly of me. Clearly you form your views based on state sources. I shouldn't have contaminated your thinking with the views of PTJ. My bad. I'll let you get back to those state-sponsored sources 'informing' your opinion.


----------



## WolfeTone

tecate said:


> That was silly of me.



You will note that while @letitroll has no remote interest in what PTJ thinks about bitcoin, s/he expects we all sit up and pay attention to some presenter on CNN.


----------



## Duke of Marmalade

tecate said:


> Except that he's not doing any such thing.


That's exactly what I thought.  How could a piece of math be "honest".  @tecate it shows that you are not true cultist to have similar doubts, you're not like PTJ. 
PTJ is insistent that his reason for investing in btc is that it is math, with all the qualities of math.  But that doesn't explain why he thinks its market cap is greater than the 2,000 kopykats and offspring together some of which are possibly even better at math.  
He obviously places great store on bitcoin's honesty virtue and as I suspect other virtues like loving and caring, which he presumably thinks are missing from the kopykats.
Those are the jokes, but seriously I never heard such pompous, pretentious, portentous piddle than that quote from PTJ.


----------



## tecate

Duke of Marmalade said:


> That's exactly what I thought.


As you well know, the comment I made relates to your wayward claim that Bukele is trying to move El Salvador out of the USD. He's confirmed that he's not doing that.




Duke of Marmalade said:


> How could a piece of math be "honest".


When it's programmed-in and hard wired in to a digital currency and can't be tampered with.



Duke of Marmalade said:


> @tecate it shows that you are not true cultist to have similar doubts


What doubts have I expressed your dukeness?




Duke of Marmalade said:


> PTJ is insistent that his reason for investing in btc is that it is math, with all the qualities of math.  But that doesn't explain why he thinks its market cap is greater than the 2,000 kopykats and offspring together some of which are possibly even better at math.
> He obviously places great store on bitcoin's honesty virtue and as I suspect other virtues like loving and caring, which he presumably thinks are missing from the kopykats.



I believe you read his  last year - which provides his complete thesis on BTC.  The fact that bitcoin can't be tampered and tinkered with is central to most people's rationale for taking an interest in it. It's not his complete reasoning - but clearly, its a major component.
As regards other cryptos, you've been told many times - over the course of four years - go and launch your own crypto then - if its so easy. By that logic, you could also launch facedukebook - seeing as all you have to do is copy it.



Duke of Marmalade said:


> Those are the jokes, but seriously I never heard such pompous, pretentious, portentous piddle than that quote from PTJ.


'Pugnacious' you were probably searching for (if it's a consideration of your good self in trying to find some sort of angle on this).


----------



## Duke of Marmalade

tecate said:


> As you well know, the comment I made relates to your wayward claim that Bukele is trying to move El Salvador out of the USD. He's confirmed that he's not doing that.


As you well know, your comment was in your non answer to my request of instances of honesty on the behalf of bitcoin.  You dismissed that question as defying logic. I firmly agree with you, but it was not my logic, it was PTJ who claimed btc was honest. 
Are you even following your own posts?


----------



## letitroll

Not all bitcoin transactions are being done by criminals and speculators……..but if the marginal purchaser/seller on most days are criminals and speculators it can move in a very dramatic fashion…..and once these market participants are substracted from the ‘network‘…….the underlying non-criminal/gambling utility of bitcoin will be revealed. 

My view then is its a ultra minority sport - populated with people like @WolfeTone who are convinced the world economic system is no more than 6 months away (always!) from inevitable collapse…………doomsday prep-ers, digital gold bugs & the tinfoil hat brigade……thats BTC natural constituency once the crims and gamblers bail out.


----------



## tecate

Duke of Marmalade said:


> As you well know, your comment was in your non answer to my request of instances of honesty on the behalf of bitcoin.  You dismissed that question as defying logic. I firmly agree with you, but it was not my logic, it was PTJ who claimed btc was honest.


I'll humour the notion that you're having comprehension difficulties with this just for sport. Bitcoin is a protocol  and as a protocol it hasn't been designed to be dishonest. It's clear what its monetary policy is today, tomorrow, next week/month/year, etc. It provides complete transparency  and it can't be tampered with. In that respect it's all of the things that PTJ mentioned -> reliable/consistent/honest/100% certain.

Now on the other hand, with your central bank high priests, we don't know from one second to the next what they're likely to do. What we do know today is that their fudging in Lebanon has seen the Lebanese pound lose 90% of its value. Who knows, maybe they can join a long list of their esteemed colleagues and make it to 100%.


----------



## WolfeTone

letitroll said:


> but if the marginal purchaser/seller on most days are criminals and speculators it can move in a very dramatic fashion…..



Well are they criminals or not? You are casting doubt on your own previous conviction.



letitroll said:


> people like @WolfeTone who are convinced the world economic system is no more than 6 months away (always!) from inevitable collapse…………



I have never been convinced of an inevitable crash within 6 months. I know some people however who have predicted the demise of bitcoin on umpteen occasions over the last 4/5 yrs. I can add you to the list.


----------



## tecate

Just to dispel the notion that it has to be expensive and time consuming to transact bitcoin, here's a demonstration of btc being sent across three bitcoin wallets within 20 seconds.


__ https://twitter.com/i/web/status/1404707783644168193


----------



## Duke of Marmalade

tecate said:


> it's all of the things that PTJ mentioned -> reliable/consistent/honest/100% certain.


The only thing that matters in the end of the day for a currency is its purchasing power or its price, if you like.  You yourself keep excusing the poor honest fledgling of being on a voyage of price discovery.  You just don't seem to understand (it's Leaving Cert stuff) that price is a function of supply *and demand*.  Having a reliable/consistent/100% certain supply is easy peasy (2,000 cryptos manage it) but absolutely useless if demand is all over the shop.


tecate said:


> Now on the other hand, with your central bank high priests, we don't know from one second to the next what they're likely to do.


Because we don't know form one second to the next the level of demand for a currency in the economy.  When it comes to bitcoin, demand is so terribly unpredictable that its price can move by over a third one way or another in a matter of weeks and has done so several times in this year alone.  It is not helped that demand is influenced by the latest sneeze from El Musk.  How anyone can describe any currency with these wild price fluctuations as "reliable/consistent and 100% certain" is beyond me.  Taken with the fact that they have a skin in the game I would suggest that such assertions are far from "honest".

@tecate perhaps you do not understand the law of supply and demand.  If this is a gap in your comprehension I apologise for any patronising tone to my posts.


----------



## tecate

Duke of Marmalade said:


> The only thing that matters in the end of the day for a currency is its purchasing power or its price, if you like.


So in other words, you're moving away from the feigned criticism of PTJ as you knew well what he meant - you just didn't like the sound of it. That's bad faith argument your dukeness.
You want to now discuss purchasing power?  Here's a visual representation of the purchasing power of the leading fiat currency in the world:





The Lebanese Pound has managed that same 90% loss of purchasing power - but their central bank high priests are far more expedient - achieving that milestone  in a matter of months.


Duke of Marmalade said:


> You yourself keep excusing the poor honest fledgling of being on a voyage of price discovery.


From post no. 942:


			
				tecate said:
			
		

> @dukey : So I asked you how it could have been designed so that it doesn't have to go through a transitory phase of high volatility and you have no suggestion. Understood.


On many occasions - over the course of four years - I've acknowledged that bitcoin's volatility is far from ideal. However, I understand why it needs to be volatile until such time as it matures as a digital asset and a digital currency. On the other hand, you know well why its volatile but try and pass it off as if there's no logic to it. That's more bad faith argument.



Duke of Marmalade said:


> You just don't seem to understand (it's Leaving Cert stuff) that price is a function of supply *and demand*.


You knew that statement was disingenuous before you even wrote it. From post no. 938:


			
				tecate said:
			
		

> explain to us how there can be any other route to its maturity other than a multi-year process of price discovery that is directly related to adoption - and thus, *demand?*


How about this one from last year?:


			
				tecate said:
			
		

> Price is a function of supply and *demand*.


Is this where I don't understand that 'price is a function of supply and demand'?
How about this one from 2019?:


			
				tecate said:
			
		

> 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*.






Duke of Marmalade said:


> Having a reliable/consistent/100% certain supply is easy peasy (2,000 cryptos manage it) but absolutely useless if demand is all over the shop.


That statement is factually incorrect. It is in no way easy to provide for a fixed supply currency. The originators of the bitcoin project have been lauded in cryptography and computer science for solving the double spend issue  - and thus providing for a tamperproof, fixed supply digital asset and currency. For that reason, it's the most finite financial asset that exists in the world today - nothing comes close.
Name ONE fiat currency that achieves a 'certain supply' - just one? You can't because such a thing doesnt exist, has never existed and will never exist.
As regards demand, we know that demand has been consistently going upwards as we work our way through adoption - having started out with no equivalent value to today - where it's worth the equivalent of around $40,000. This adoption process and the demand that goes with it works in cycles. Its said that there are 100 million people who own bitcoin in the world right now. There will be further strains on demand as we get to a billion people. There's a clear logic to the whole process even if the volatility that comes with it is far from desirable.



Duke of Marmalade said:


> Because we don't know form one second to the next the level of demand for a currency in the economy.  When it comes to bitcoin, demand is so terribly unpredictable that its price can move by over a third one way or another in a matter of weeks and has done so several times in this year alone.


See above.



Duke of Marmalade said:


> It is not helped that demand is influenced by the latest sneeze from El Musk.


I agree. However, you'll find that said gentleman is reaching the law of diminishing returns where influence related to bitcoin is concerned. Furthermore, it's all just a part of the development of the digital asset and currency. As we move from 100 million people to a billion people, the 'influence' of individuals will have far less effect on bitcoin.




Duke of Marmalade said:


> How anyone can describe any currency with these wild price fluctuations as "reliable/consistent and 100% certain" is beyond me.


And I'll take you to task on this statement. You know perfectly well that PTJ was talking about the monetary policy of bitcoin where everyone knows whats set out from today until the year dot - vs - the 'who the hell knows what the central bank high priests will do' - monetary policy of the USD, euro, etc. It's clear to anyone what PTJ was referring to - when you watch the interview (which I linked to in that previous post). The whole conversation revolved around a discussion on monetary policy relative to inflation.




Duke of Marmalade said:


> Taken with the fact that they have a skin in the game I would suggest that such assertions are far from "honest".


That won't do, your dukeness. I would suggest it is your assertions that are 'far from honest'.  See above. If not, then prove to us how bitcoin's monetary policy isn't certain/reliable/consistent/honest by a straight up comparison with fiat currency without rambling off into areas that don't implicate monetary policy.


----------



## Duke of Marmalade

tecate said:


> So in other words, you're moving away from the feigned criticism of PTJ as you knew well what he meant - you just didn't like the sound of it.


I didn't like the sound of it at all.  We all know that it's supply is fixed.  But words like "reliable", "consistent" and "100% certain"  are pure hype.


tecate said:


> That statement is factually incorrect. It is in no way easy to provide for a fixed supply currency.


To please you I will let you have that this is the greatest break through in technology since the fax machine.  If Satoshi was not so shy s/he would surely be the owner of several Nobel Prizes - Economics, Physics, Peace you name it.  But by return I would hope you would allow me that with 2,000 kopykats and offshoots it is not exactly rare.



tecate said:


> reason, it's the most finite financial asset that exists in the world today - nothing comes close.


Am I wrong about those 2,000?  For example does Bitcoin Cash not come close?



tecate said:


> Name ONE fiat currency that achieves a 'certain supply' - just one? You can't because such a thing doesnt exist, has never existed and will never exist.


The whole point of a fiat currency is that it can be managed for optimal impact for the economy. The idea that we would have the same supply of sterling now as in, say, 1690 is simply batty. 
Can you name one, just one, crypto that has successfully completed its voyage of price discovery?


----------



## tecate

Duke of Marmalade said:


> I didn't like the sound of it at all.  We all know that it's supply is fixed.  But words like "reliable", "consistent" and "100% certain"  are pure hype.


He was referring to its monetary policy of which - fixed supply and transparency re. issuance from now up until 2140 and beyond are central to. You can in no way claim this to be hype as its stone cold fact. Is bitcoin's monetary policy known today, tomorrow, next month/year/decade/century - yes it is.  Do we know what your central bank gurus will do re monetary policy from one minute to the next? No we don't. There is no hype in respect of a comparison on the grounds of monetary policy.



Duke of Marmalade said:


> To please you I will let you have that this is the greatest break through in technology since the fax machine.  If Satoshi was not so shy s/he would surely be the owner of several Nobel Prizes - Economics, Physics, Peace you name it.



You don't have to take my word for it - the originator(s) of bitcoin has/have been widely acknowledged in this regard in that field.



Duke of Marmalade said:


> But by return I would hope you would allow me that with 2,000 kopykats and offshoots it is not exactly rare.


You've trotted that out over four years Duke - and its wayward. The bitcoin codebase is open source - you can copy it and spin up marmalade-coin within a couple of hours. What you can't do is replicate the network. As per the analogy I gave you yesterday, you can copy google or facebook today - you may have their offering replicated to a tee - but you won't be able to copy their actual network. The same with google, twitter, etc. ,etc.




Duke of Marmalade said:


> Am I wrong about those 2,000?  For example does Bitcoin Cash not come close?



Of the 2,000, only a handful are even designed to fulfill the same use case as bitcoin - the vast majority are not money/store of value related. Of the handful that are left - lets take the one you mentioned - bitcoin cash. You can check it yourself but I think it has around 1-2% of the market cap of bitcoin. It lost the block-size war and to me, its just a zombie project at this point.  Further development of lightning network will finish it off. The only reason it managed to get that couple of percent in market cap to begin with - was because it hard forked away from the bitcoin network and couldn't even stand on its own two feet without also robbing the 'bitcoin' brand.




Duke of Marmalade said:


> Can you name one, just one, crypto that has successfully completed its voyage of price discovery?


That's a totally unreasonable request Dukey. I'm not aware of anyone - proponent or naysayer - who would even begin to suggest that this sector (and all the projects within it) is anywhere near maturity. You know that price discovery continues whilst adoption continues.  Adoption only accounts for a couple of per cent of people.




Duke of Marmalade said:


> The whole point of a fiat currency is that it can be managed for optimal impact for the economy. The idea that we would have the same supply of sterling now as in, say, 1690 is simply batty.


I can see a certain logic to the need to have a currency that's flexible in terms of supply. However, this is not binary. If you can drop your flat rejection of btc for a second, maybe you might see that one could benefit the other.  The issue with flexible supply currencies is that we can't trust the folk who are taking those supply decisions 100% of the time. Having btc in the background could act as an incentive to central bankers and governments to act equitably and responsibly. Because if they can't, a flexible supply currency is the 'battier' of the two options - as it is today in Lebanon - and a host of other countries.


----------



## Duke of Marmalade

tecate said:


> He was referring to its monetary policy of which - fixed supply and transparency re. issuance from now up until 2140 and beyond are central to. You can in no way claim this to be hype as its stone cold fact. Is bitcoin's monetary policy known today, tomorrow, next month/year/decade/century - yes it is.


"Hype" does not mean false it comes from "hyperbole" and refers to describing things in exaggeratedly favourable terms.  "stone cold fact" okay I will allow him to use "100% certain" to express that but on top of that we have "reliable", "consistent"  "honest"  .  The guy is a cultist - this is hype.



tecate said:


> I'm not aware of anyone - proponent or naysayer - who would even begin to suggest that this sector (and all the projects within it) is anywhere near maturity. You know that price discovery continues whilst adoption continues.  Adoption only accounts for a couple of per cent of people.


So leaving aside the cult's obsession with supply I take it from this that the price of bitcoin for the foreseeable future will be none of reliable, consistent, 100% certain or honest.
And yet the Miami Bitcoin Love-in cheered to the rafters the imposition of this monetary weeping gelignite on the poor people of El Sal.


----------



## tecate

Duke of Marmalade said:


> "Hype" does not mean false it comes from "hyperbole" and refers to describing things in exaggeratedly favourable terms.  "stone cold fact" okay I will allow him to use "100% certain" to express that but on top of that we have "reliable", "consistent"  "honest"  .


Rubbish! He expressed his view - and having started by suggesting that his viewpoint was inaccurate - now you're resorting to saying that its correct but he's making too much out of it. If something is hard-wired/programmed in, explain to us how it can't be reliable, consistent and honest - without veering away from the topic at hand - which is monetary policy as it relates to bitcoin.



Duke of Marmalade said:


> The guy is a cultist - this is hype.


Essentially, anyone who disagrees with you and states anything that is remotely positive re. bitcoin is a cultist - right Duke! PTJ couldn't possibly be described as a bitcoiner - he's a seasoned wall street suit....that you're now calling a cultist.  These guys don't get sentimental - but bitcoin doesn't discriminate in terms of who gets to use it - its decentralised and so its available to him or anyone else on the planet to use. 




Duke of Marmalade said:


> So leaving aside the cult's obsession with supply


You mean you don't want to acknowledge one single positive characteristic of bitcoin and when you can't stomach the thought of it, you resort to the 'cult' tar and feathering? Understood.




Duke of Marmalade said:


> I take it from this that the price of bitcoin for the foreseeable future will be none of reliable, consistent, 100% certain or honest.


I take it from this that you won't engage in honest discussion on the topic. Not that you didn't know already, you have been told that PTJs comments were in the context of a discussion of inflation and monetary policy - relative to the USD and bitcoin. Nothing beyond that. 



Duke of Marmalade said:


> And yet the Miami Bitcoin Love-in cheered to the rafters the imposition of this monetary weeping gelignite on the poor people of El Sal.



You're referring to Bitcoin 2021 - the Bitcoin conference that drew in 20,000 attendees? They cheered on the ability to chose. Don't claim for a second that you give a fiddlers for the people of El Salvador.  Since this topic arose a couple of weeks ago, on several occasions it was pointed out to you (and to @letitroll ) that the 'poor people of El Sal.' as you describe them - have been denied banking.  70% of them don't have access to a bank account.  Neither of you acknowledged that fact. Neither of you said that it wasn't in any way equitable - but both of you have been going on about the 'poor people of El Salvador' - that they might choose to use bitcoin for remittances so that they aren't screwed to the tune of 10% by entities like Western Union. That they might accept bitcoin from people who have it and want to spend it. 
Why don't you pour yourself a vodka and ask Siri what the currency of El Salvador is?  Knowing the hatred you have for it, I'd suggest it may be necessary to leave the bottle on standby.


----------



## Duke of Marmalade

@tecate we agree on one thing anyway.  The price of bitcoin will be incredibly unreliable, inconsistent and uncertain for a long time to come.  You sugar this reality by calling it a "voyage of price discovery".  Heck, I'll let you away with that.  I will not ask you to agree with the sequitur but it is the inexorable implication.  Until that "voyage" finds its destination bitcoin is entirely unsuitable as a medium of exchange, as a unit of account or as a store of value.  And yet there are those that cheer the imposition of this on the poor people of El Sal.  And they don't look like the sort of folk who would give a damn for poor people anywhere.


----------



## tecate

Duke of Marmalade said:


> @tecate we agree on one thing anyway.  The price of bitcoin will be incredibly unreliable, inconsistent and uncertain for a long time to come.


In those prejudicially inaccurate terms, we certainly don't.  As I acknowledged four years ago and a gazillion times in between then and now, bitcoin will remain a volatile asset and means of exchange for some years to come.



Duke of Marmalade said:


> You sugar this reality by calling it a "voyage of price discovery".  Heck, I'll let you away with that.


Eh, no - I dont sugar coat anything. You've been invited to explain in what other way the pricing of bitcoin as a fixed supply currency would be achieved in a scenario where it isn't pegged to the USD (and of course, it isn't because that would defeat the whole purpose) or backed by a physical asset (again, it would defeat the purpose). You declined to go there. You can't have it both ways. What would be a rational and reasonable take would be to say that yes, I understand it - but it's a major impediment.  I can live with you opposing the volatility - but not to acknowledge the rationale behind that volatility is bad faith argument. Unless of course you have some other insight into how bitcoin could arrive at a settled price - but over the course of four years, we haven't heard any such explanation from you.

Therefore, I have not sugar coated anything. I've acknowledged bitcoin's volatility - whilst also laying out and acknowledging why it has to be - until such time as it matures as an asset.




Duke of Marmalade said:


> Until that "voyage" finds its destination bitcoin is entirely unsuitable as a medium of exchange, as a unit of account or as a store of value.


Incorrect. Bitcoin remains a sound store of value over the longer haul. Shorter term volatility doesn't disqualify it on that basis. You cannot deny the fact that bitcoin has been the best performing asset of the past decade and most of its years of existence - with perhaps the exception of two of those twelve years. Shorter term volatility doesn't in any way rule out bitcoin as a store of value. Gold was just as volatile in the '70's and I don't hear a squeak from anyone complaining about that. How about 2011 to 2015 when it fell from $1,875 to $1,000?  Not a word, right?

On unit of account, that's the last of the three that would ever come into play.  Personally, I'm quite happy if I'm free to utilise bitcoin to store or to spend at will - without it having become a unit of account.

On medium of exchange - i.e. a currency - you have stated many times that its not. And yet, today it very much is in defiance of your protests. Is volatility ideal for a medium of exchange? Far from it. However, if you're in a developing nation where your local currency is far more volatile - and/or maybe your government is stealing from you - and you become comfortable in the use of bitcoin - you won't care half as much about bitcoin's volatility.
El Salvador was unexpected. What was expected was such a developing nation to put a small proportion of their balance sheet in bitcoin. Then again, it seems the Salvadorans are doing that too - as they're working on a project to mine bitcoin using excess geothermal energy from their volcanoes.



Duke of Marmalade said:


> And yet there are those that cheer the imposition of this on the poor people of El Sal.


What imposition? The imposition where they now have the choice between using USD and BTC? That's one hell of an imposition alright! I don't for one second believe this is anything but faux-concern on your part - based on a contrivance.



Duke of Marmalade said:


> And they don't look like the sort of folk who would give a damn for poor people anywhere.


Benevolence starts at home. I gave you yet another explicit opportunity to acknowledge that the banking system has screwed the El Salvadorans - and yet, you can't manage it. Pitiful.

What about the the citizen's of Lebanon - can you be objective enough to acknowledge that the central bank and government has failed them?


----------



## WolfeTone

In the last week of El Salvador making bitcoin legal tender, the predominant currency of USD has crashed 17% against the price of 1 BTC. 

Of course the exchange rate between the two legal tenders is volatile. But one has a track record, albeit an inconsistent, unreliable, uncertain purchasing power increasing on average by 200% pa since its inception. 
The other is reliable, consistent, certain 2% demise pa of purchasing power. 

I remember reading somewhere, something about a capitalist free-trade, risk/reward etc?

All I seem to hear now when it comes to poor people - you are poor, you shall remain poor, do not do anything that risks taking you out of poverty.


----------



## Duke of Marmalade

WolfeTone said:


> All I seem to hear now when it comes to poor people - you are poor, you shall remain poor, do not do anything that risks taking you out of poverty.


You are consistent _Wolfie_.  Go on poor people of El Sal, have a punt on bitcoin, it could be you.


----------



## WolfeTone

Duke of Marmalade said:


> You are consistent _Wolfie_. Go on poor people of El Sal, have a punt on bitcoin, it could be you.



You still propagating the false premise that the value of bitcoin will demise by 8pm on a Saturday night? I thought BOHA was being quietly retired from your narrative? Silly me! 

Your concern for the poor of El Salvador is touching, if a touch patronising. It is the usual typical arrogant, self entitled _"I know what's best for you" _guff that perpetuates the very poverty that you shed crocodile tears for.


----------



## Duke of Marmalade

@WolfeTone I could never match the sincerity of your concern for the poor not only of El Sal but the world.  I just ask you to think twice about your recommendation that the way out of their poverty is to have a punt on bitcoin.  Maybe they might not agree with your assessment that they have nothing to lose, which might just seem to them a tad patronising.
I am not sure your mentor would fully approve of your philosophy.  I think he sees bitcoin more as a way of escaping central bank gouging than a gamble for untold riches.


----------



## WolfeTone

Duke of Marmalade said:


> I could never match the sincerity of your concern for the poor not only of El Sal but the world



Ah c'mon Duke, I think you know you are not engaging with Mother Theresa here. I just saw an opportunity to throw a below the belt punch and took it!  



Duke of Marmalade said:


> Maybe they might not agree with your assessment that they have nothing to lose, which might just seem to them a tad patronising.



Yeh, quite possibly, or possibly some of them might?

I think @tecate made the point earlier - they (the poor of El Salvador) now have choice (_oh! the horror! ) _

The essence of enterprise? Essence of free markets?

As a side, an interesting if limited podcast by McWilliams this week on '*what is* *money*'.
 I recall you are not a big fan of McW and I share the sentiment , but I recognise he does have an impact and does attract interesting guests with thought provoking views.
Bitcoin makes an appearance in this podcast, from both a negative and positive perspective. Im probably disposed to automatically tune onto the positive view as you are to the negative view.
Nevertheless, worth a listen imo.


----------



## WolfeTone

WolfeTone said:


> I think @tecate made the point earlier - they (the poor of El Salvador) now have a choice



Actually, I am going to contradict myself here and say they always had a choice with bitcoin.
No different to me or anyone else. An Internet connection and a smart phone, everyone has that choice now.


----------



## DublinHead54

tecate said:


> When it's programmed-in and hard wired in to a digital currency and can't be tampered with.



It is simply factually incorrect to say that the Bitcoin code base cannot be changed.


----------



## time to plan

Duke of Marmalade said:


> @tecate we agree on one thing anyway.  The price of bitcoin will be incredibly unreliable, inconsistent and uncertain for a long time to come.  You sugar this reality by calling it a "voyage of price discovery".  Heck, I'll let you away with that.  I will not ask you to agree with the sequitur but it is the inexorable implication.  Until that "voyage" finds its destination bitcoin is entirely unsuitable as a medium of exchange, as a unit of account or as a store of value.  And yet there are those that cheer the imposition of this on the poor people of El Sal.  And they don't look like the sort of folk who would give a damn for poor people anywhere.


The price of 1 bitcoin is 1 bitcoin. Who cares what it is priced in terms of trash fiat currency? All we need is for the sheeple to demand to be paid in bitcoin and for goods and services to be priced in bitcoin, because that's how actual money works.


----------



## Duke of Marmalade

time to plan said:


> The price of 1 bitcoin is 1 bitcoin. Who cares what it is priced in terms of trash fiat currency? All we need is for the sheeple to demand to be paid in bitcoin and for goods and services to be priced in bitcoin, because that's how actual money works.


Don't know whether you are making a serious point or not, as you are new to the debate.
Since you are addressing me let me agree full heartedly with your definition of "actual money" and by any standard bitcoin fails on all fronts.


----------



## WolfeTone

Duke of Marmalade said:


> let me agree full heartedly with your definition of "actual money"



You didn't take to listening to that McW podcast then? The one about "What is money"? 
According to McW, most economists don't know what money is. 
Quite a staggering claim one would have thought?  Nonetheless, one I would trend to agree with.


----------



## time to plan

Duke of Marmalade said:


> Don't know whether you are making a serious point or not, as you are new to the debate.
> Since you are addressing me let me agree full heartedly with your definition of "actual money" and by any standard bitcoin fails on all fronts.


I'm just having a giggle at the expense of the Tulipmongers.


----------



## Duke of Marmalade

WolfeTone said:


> You didn't take to listening to that McW podcast then? The one about "What is money"?
> According to McW, most economists don't know what money is.
> Quite a staggering claim one would have thought?  Nonetheless, one I would trend to agree with.


_Wolfie _you didn't provide a link. But following this post I decided to give it a go. I don't know if I will ever be able to forgive you. 
What a loada self indulgent BS.  I should have stopped early doors when we had the most sensible quote of the whole podcast - Lonergan's daughter describes money as "it's what you use to pay for things".  Which rules out bitcoin at least in its current state.
McW is fond of telling us how ignorant the majority of economists are; I presume he counts himself amongst the minority who do understand it.
The debate on QE was so infantile that I think they knew that but were feeding the fan base - QE bad.
As for bitcoin they truly gushed at how each bitcoin can be traced back through the blockchain to its birth. Even @tecate doesn't make a big deal of this.
And what about "money is created by the State and so we are all equally entitled to it"? which I think even Lenin would have baulked at.
The one interesting area which Lonergan did raise was that CBs seem to have displaced the primacy of the markets.  It was Mrs T who said you can't buck the market, but I really can't understand how the market for 30 year fixed € interest rates is around 0.5%.  How does that make sense to anybody? - seems the CB are calling the tune like never before.  That is not necessarily a bad thing especially for those of a leftist outlook who generally distrust the markets.


----------



## tecate

time to plan said:


> I'm just having a giggle at the expense of the Tulipmongers.


Have at it - as this unfolds over the longer run, the expense will be all yours.   


Duke of Marmalade said:


> The debate on QE was so infantile that I think they knew that but were feeding the fan base - QE bad.


Is QE good then and if so, for whom?



Duke of Marmalade said:


> As for bitcoin they truly gushed at how each bitcoin can be traced back through the blockchain to its birth. Even @tecate doesn't make a big deal of this.


I don't because I tend to agree with Ed Snowden on the subject - privacy is important and bitcoin should be updated accordingly. That said, its been educational watching main stream media write polar opposite crap - trying to give bitcoin a kicking from both sides. We've had multiple 'bitcoin is the doings of criminality because it's untraceable' nonsense which no-one who has spent any time on bitcoin believes. No bitcoiner has ever claimed bitcoin to be untraceable, quite the opposite. 
Then the ransomware $ turns up and they're publishing the opposite nonsense - look, these guys got it wrong - bitcoin isn't untraceable (the narrative from the very same media - not from anyone else). So no Duke - I don't make a big deal of this - but MSM does.



Duke of Marmalade said:


> And what about "money is created by the State and so we are all equally entitled to it"? which I think even Lenin would have baulked at.


Finally, that monopoly is breaking.


----------



## WolfeTone

Duke of Marmalade said:


> I don't know if I will ever be able to forgive you.



Apologies, I wasn't endorsing the whole podcast. I generally listen to McW for his guest contributions (hit and miss) rather than his own insights  which, while sometimes interesting and engaging, have been regurgitated endlessly now. 

McW has been avoiding the whole bitcoin debate for sometime and any references to it he astutely sits on the fence. However, with the Lordships of the CB's talking more frequently about it he is being slowly dragged into the debate, albeit making no definitive assertion about it.

However, the question "what is money?" arose. My own definition preference is economic historian Niall Ferguson, money is "trust inscribed". 
My own definition is that money is a form of communication that transmits and transfers value between humans. The transfer of that value occurring by way of currency.
Whatever it is, it is clear to me beyond the McW show and further afield, the definition of what money actually is quite uncertain. Being limited in general terms to banknotes and coins, bank balances, value of property and shares etc. All of which is money, but it only defines money limited in terms of central bank issued currency. All other forms of money, or the prospect of using any other form of money, are to be discounted. That is a credit to the inherent trust within the fiat system, a problem arises when that trust starts to ebb.

As Ferguson attests, such a form of communication needs to have trust inscribed for it to have, and sustain, value. 
According to him, it doesn't matter if it is in clay tablets (as used in ancient Mesopotamia), seashells, silver, gold, or banknotes as long as the bearer and recipient of the currency are agreeable that is represents the value inscribed in it.



Duke of Marmalade said:


> I really can't understand how the market for 30 year fixed € interest rates is around 0.5%. How does that make sense to anybody? - seems the CB are calling the tune like never before



Exactly the point, if it starts to make little sense, then perhaps all is not well?


----------



## Duke of Marmalade

@WolfeTone I don't see any difficulty with a definition of what is "money".  Lonergan's daughter puts it very well "it is what you use to pay for things".  Now perhaps what most economists except DMcW find difficult to understand is what makes for a good form of money. @tecate has in the past given us a list of desirable attributes - divisibility, durability etc.
The attribute that needs most critical consideration is "store of value".  I prefer the term "stable purchasing power in the medium term".  In fact a good long term store of value is not helpful as a modern medium of exchange.  
Fiat money is a form of debt from society which bridges the lack of coincidence of wants needed in a barter economy.  The debt aspect is fairly key.  For example, the fact that a young couple are heavily mortgaged is a big underpin to them wanting to continue working for money.
Now stable purchasing power of something with no intrinsic value does derive from society acceptance.  The stability and acceptance of fiat in developed economies is underpinned by many things including Central Bank oversight.
Bitcoin is completely devoid of these underpinnings and, as even its devotees concede as a non trivial risk, could go BOHA very quickly.


----------



## WolfeTone

Duke of Marmalade said:


> it is what you use to pay for things



Yes, but that is more its functionality that what it actually is, which is the transmission and transfer of value between human beings based on trust. 
Ferguson highlights this with the use of clay tablets 4,000 BC which conferred obligations on individual to provide goods and services on the bearer of the clay tablets. The clay tablets themselves easily imitated. What was not easily imitated was what was written on them. Being 4,000 BC it doesn't take a genius to figure that literacy was most probably the preserve of high priests and nobles of the era. And if they could read and write what was on the tablets, who could dispute their word? 
For example, the scriptures of the Bible have endured to this day. If it is written, then so it shall be...trust.

The same principle exists today with CB monetary system. Fiat has no intrinsic value other than the trust applied to it by the population by virtue what the high priests and nobles of the CB say is to be trusted. 
And in this centralised command banking economy how can any sense be made of 30yr interest rates of 0.5%?


----------



## tecate

Duke of Marmalade said:


> The attribute that needs most critical consideration is "store of value".  I prefer the term "stable purchasing power in the medium term".  In fact a good long term store of value is not helpful as a modern medium of exchange.


Thanks for acknowledging bitcoin as a long term store of value. There is some merit to what you say - on the basis of Greshams Law - i.e. people want to offload crap coin and hold back hard money. Now if that crap coin can be managed to a point where it doesn't get too wayward (with the managers of that crap coin aware that if they mess up their crap coin will cease to be used) - whilst hard money is used for savings - I can see that as a win for society. As I've mentioned many times - this is not a black/white - binary scenario. Both can co-exist and choice/competition is healthy.




Duke of Marmalade said:


> Fiat money is a form of debt from society which bridges the lack of coincidence of wants needed in a barter economy.  The debt aspect is fairly key.  For example, the fact that a young couple are heavily mortgaged is a big underpin to them wanting to continue working for money.


This is very interesting. So you think that big government is seeing to it that the system is designed such that Joe/Josephine Soap are up to their tonsils in debt - for their own good? So that they will be productive little foot soldiers because what's most important is that we feed the Keynesian Economy Monster? Can they not be trusted to make this decision for themselves? Would they not want to make that decision for themselves? I'm sure if you pour over other posts in other sections of this board, you'll see advice from Brendan and others to pay off the mortgage. Is that bad advice?
Isn't it also true that the current model needs this - because growth has to be achieved regardless of the cost? i.e. the stress and quality of life issues it may cause by encouraging people to be up to their eyeballs in debt? Aside from that, the irony when bitcoin is being tarred and feathered on environmental grounds when the real culprit is the current economic model that encourages people to consume at all costs - it doesn't matter what - just consume and keep the economy fed.



Duke of Marmalade said:


> The stability and acceptance of fiat in developed economies is underpinned by many things including Central Bank oversight.


How's that oversight going in Lebanon right now? You know I can list off a plethora of other examples - past and present - so for expediency, I won't bother.




Duke of Marmalade said:


> Bitcoin is completely devoid of these underpinnings


That's incorrect - quite the opposite. Bitcoin has a monetary policy and the beauty of it is that nobody can screw with it and it's totally transparent. Furthermore, there's little in the way of stealth tax via inflation. So when ordinary people work hard and are productive, they don't have to become advanced investors/traders to try and get ahead of that nonsense which otherwise erodes and undoes all of their hard work.



Duke of Marmalade said:


> as even its devotees concede as a non trivial risk, could go BOHA very quickly.


Most proponents of BTC are aware of the difficulty in trying to achieve adoption for something that is technical, new and faces fierce opposition from most corners of the conventional world of finance/government/banking, etc. That's where most don't get too far ahead of themselves - not on the basis of the design or monetary policy of bitcoin.


----------



## Duke of Marmalade

@WolfeTone Well "trust" is central to the clay tablets and to modern fiat.  But it was not always enough.  Sea shells, gold, silver etc. were not based on trust - they had intrinsic value.  Under the gold standard, other than trusting "promise to pay the bearer" money essentially had intrinsic value.  Modern fiat is of the form "trust your Central Bank/government to do its best to maintain the stability of the purchasing power".
The huge weakness of bitcoin/crypto is in fact what the cultists call its strength - it is trustless.  There is no central authority to trust to maintain its stability.  Yes of course we can "trust" the protocol to provide a finite supply but with no intrinsic value that is useless for building confidence in the stability of its purchasing power, as we witness on a daily basis.


----------



## tecate

Duke of Marmalade said:


> @WolfeTone Well "trust" is central to the clay tablets and to modern fiat.  But it was not always enough.  Sea shells, gold, silver etc. were not based on trust - they had intrinsic value.


There were plenty of currencies based around things that didn't have intrinsic value. Rai stones as an example - yet they were treated as a store of value.



Duke of Marmalade said:


> Modern fiat is of the form "trust your Central Bank/government to do its best to maintain the stability of the purchasing power".


That's fiat's Achilles Heel.



Duke of Marmalade said:


> The huge weakness of bitcoin/crypto is in fact what the cultists call its strength - it is trustless.  There is no central authority to trust to maintain its stability.  Yes of course we can "trust" the protocol to provide a finite supply but with no intrinsic value that is useless for building confidence in the stability of its purchasing power, as we witness on a daily basis.


'Cult' jibes from a committed wahabist. Yes, bitcoin is volatile and will remain volatile whilst it goes through the adoption curve. As has been pointed out to you, gold has seen some volatility of the same proportions in the past. Therefore, it isn't necessarily so that a lack of intrinsic value is at the heart of the question of btc's  volatility.


----------



## DublinHead54

tecate said:


> There is no realistic and credible threat to the bitcoin network from any Chinese entity - be that a corporation or the Chinese government.
> 
> On the government threat - firstly, they would need a motivation. Who would they be attacking in going to all that effort? But for all intents and purposes, lets assume that the Chinese government have one. Mining farms are cast all over China - often in remote inaccessible locations. *The Chinese can't move against these miners without letting the cat out of the bag that something is afoot. Counter measures would be taken. The attack would fail. *At worst it would cause temporary network disruption. As with all other attacks, such an eventuality would only serve to make the network stronger in the longer term.



Oh really?









						Sichuan Mining Farms Begin to Shut Down — Seven-Day Stats Show Bitcoin’s Hashrate Plummeting – Bitcoin News
					

Bitcoin's hashrate has been steadily falling since June 14 and after Sichuan miners were told to prepare operation shutdowns.




					news.bitcoin.com


----------



## DazedInPontoon

In 7 days, the mining difficulty will adjust. It's currently on schedule to reduce by 18.8%. OK.


----------



## WolfeTone

Duke of Marmalade said:


> Modern fiat is of the form "trust your Central Bank/government to do its best to maintain the stability of the purchasing power".



Trusting them to do their best to maintain the stability of purchasing power is one thing, trusting them to succeed is another. This is far from a strength, this is the inherent weakness. Constant tampering with rules and policies to suit a perspective of certain ideology (pump asset prices/trickle down effect) is a recipe for debasement. 



Duke of Marmalade said:


> The huge weakness of bitcoin/crypto is in fact what the cultists call its strength - it is trustless. There is no central authority to trust to maintain its stability.



It's because of the lack of central authority interfering, changing the rules, changing the parameters, the policy etc that bitcoin gains strength.


----------



## tecate

DazedInPontoon said:


> In 7 days, the mining difficulty will adjust. It's currently on schedule to reduce by 18.8%. OK.


Indeed it will - it's a beautiful thing. For an age, we had claims of bitcoin being subject to Chinese control. Clearly that was wayward. There's no way that the Chinese would push out miners if their very presence presented them with such control over the network. Had there been an actual attack on the network, it would have failed.


----------



## DublinHead54

tecate said:


> Indeed it will - it's a beautiful thing. For an age, we had claims of bitcoin being subject to Chinese control. Clearly that was wayward. There's no way that the Chinese would push out miners if their very presence presented them with such control over the network. Had there been an actual attack on the network, it would have failed.



Tecate, I understand you like to pick and choose what points to answer. But you have to see how wrong you were by claiming the chinese government could not stop miners in china. Every reputable Crypto news source has been reporting on it, and it is evident in the hashrate.

Its ok to admit that changes have happened. It is widely accepted in the community that the Chinese government action is different this time.


For other readers of this thread, I actually think the China crackdown is good as it decreases centralization of mining and reduces the chance of a 51% attack which is bringing the network back towards the original plan. However, it was important to highlight Tecates claim that Bitcoin can operate autonomously without the Chinese government being able to mobilize against them, as simply wrong.  

The hashrate is falling: https://decrypt.co/74075/bitcoin-hashrate-falls-17-overnight-after-china-mining-crackdown


China Miners relocating to Kazakstan (https://decrypt.co/74172/chinese-bitcoin-mining-firm-relocates-machines-kazakhstan)


----------



## WolfeTone

tecate said:


> On the government threat - firstly, they would need a motivation. Who would they be attacking in going to all that effort? But for all intents and purposes, lets assume that the Chinese government have one. Mining farms are cast all over China - often in remote inaccessible locations. The Chinese can't move against these miners without letting the cat out of the bag that something is afoot. Counter measures would be taken. The attack would fail. At worst it would cause temporary network disruption. As with all other attacks, such an eventuality would only serve to make the network stronger in the longer term.





Dublinbay12 said:


> However, it was important to highlight Tecates claim that Bitcoin can operate autonomously without the Chinese government being able to mobilize against them, as simply wrong.



I think you may misconstrued @tecate point, above, about the Chinese government. I don't read it as being wrong. Actually, s/he is on the money as far as I can see. 
The substantive point being moving against miners without letting cat out of the bag - am I to understand correctly bitcoin mining is on the uptake in North America and El Salvador for example?


----------



## tecate

WolfeTone said:


> The substantive point being moving against miners without letting cat out of the bag - am I to understand correctly bitcoin mining is on the uptake in North America and El Salvador for example?


Just to take that a step further Wolfie, there were previous discussions here in relation to two things relative to mining in China:
1. The possibility of a 51% attack
2. China implementing regulation - inclusive of a potential ban on mining/trading, etc.

In relation to the former, we've now seen that there was no earthly way that a 51% attack could have been carried out with a successful outcome for the CCP. If that were the case, there is no earthly way they would push miners out of China. That was pure FUD - and nothing more.
In relation to the latter, unless someone is telling me that bitcoin mining has been banned in the other 194 jurisdictions in the world, it's of no concern. It does provide short term upheaval - with miners moving abroad - and the costs associated with that (which would necessitate them to liquidate some btc from their treasuries). 
Everyone has been aware since day 1 that the bitcoin project is completely at odds with the doings of authoritarian governments. China will always be concerned about anything that it can't control. That's why it tried to shut out the internet back in the day - and its why its shutting out bitcoin today. They're about to up the anti with their digital yuan project - something that will really allow them to have their citizenry by the short and curlies like never before. I'm sure they wouldn't want their minions being distracted by such a thing.


----------



## Duke of Marmalade

tecate said:


> Everyone has been aware since day 1 that the bitcoin project is completely at odds with the doings of *authoritarian *governments.





			
				Wiki said:
			
		

> A populist, Bukele has been criticized for governing in an *authoritarian *manner. In particular, he was denounced for sending soldiers into the Legislative Assembly to encourage the passage of a bill and allegedly to overthrow the Legislative Assembly of El Salvador. This action, his handling of endemic violence in El Salvador, and his strict response to the COVID-19 pandemic have led some academics to describe him as an autocrat or an *authoritarian*.


----------



## tecate

@Duke of Marmalade  - All too predictable.


LINK

The bitcoin project I was referring to. Bitcoin itself is an open protocol - which can be utilised by anyone - even you, Dukey.


----------



## Duke of Marmalade

tecate said:


> @Duke of Marmalade  - All too predictable.
> 
> 
> LINK
> 
> The bitcoin project I was referring to. Bitcoin itself is an open protocol - which can be utilised by anyone - even you, Dukey.


Sorry, that is too Jesuitical for me.  I am not one to criticise bitcoin because of the company it keeps but how you can describe the "project" as totally at odds with the doings of  authoritarian  governments completely baffles me.


----------



## tecate

Duke of Marmalade said:


> Sorry, that is too Jesuitical for me.  I am not one to criticise bitcoin because of the company it keeps but how you can describe the "project" as totally at odds with the doings of  authoritarian  governments completely baffles me.


The project is - bitcoin itself as a protocol doesn't care. It's open to anyone to use. I know the lengths you will go to - to tar and feather Dukey - but there's nothing of substance for you to pursue here. Most in the bitcoin space are wary of any government or government official. That hasn't changed. Nobody is putting Bukele on a pedestal. It doesn't appear that way but lets assume that Bukele has ill intent here - well, what ill-intent will that be - as he's putting in place a currency he has no control over. In a recent interview, he was asked about exactly this - his answer, you don't have to trust me/us - I/we have no control over bitcoin.
As per Alex Gladstein's (Human Rights Foundation) tweet, celebrate that individual action - not the individual(s) behind it.


----------



## DublinHead54

tecate said:


> Just to take that a step further Wolfie, there were previous discussions here in relation to two things relative to mining in China:
> 1. The possibility of a 51% attack
> 2. China implementing regulation - inclusive of a potential ban on mining/trading, etc.
> 
> In relation to the former, we've now seen that there was no earthly way that a 51% attack could have been carried out with a successful outcome for the CCP. If that were the case, there is no earthly way they would push miners out of China. That was pure FUD - and nothing more.
> In relation to the latter, unless someone is telling me that bitcoin mining has been banned in the other 194 jurisdictions in the world, it's of no concern. It does provide short term upheaval - with miners moving abroad - and the costs associated with that (which would necessitate them to liquidate some btc from their treasuries).
> Everyone has been aware since day 1 that the bitcoin project is completely at odds with the doings of authoritarian governments. China will always be concerned about anything that it can't control. That's why it tried to shut out the internet back in the day - and its why its shutting out bitcoin today. They're about to up the anti with their digital yuan project - something that will really allow them to have their citizenry by the short and curlies like never before. I'm sure they wouldn't want their minions being distracted by such a thing.



This is a stereotypical response on this thread of answering an unrelated point.  You've just not addressed the point.

The Chinese government have shut down miners. Which is contrary to your early stance that the government could not shut down miners. 

Or are you an Wolfetone now suggesting that the mainstream crypto news sources (of which you've used to suppor your arguments before) is now just reporting FUD?


----------



## DublinHead54

tecate said:


> Mining farms are cast all over China - often in remote inaccessible locations. The Chinese can't move against these miners



There we have it. Black and white, the Chinese government can't move against the miners as said so by Tecate. 

Now they've been proven wrong.


----------



## tecate

It's strange - some seem to be under the impression that the network has been _attacked_ (with a view towards taking control of it) as opposed to _regulation_ within one territory being applied and can't seem to be able to comprehend the difference between the two.

Asking miners to leave a territory is not an attack on the network. A 51% attack would involve much more than asking miners to leave a territory within a timeframe.


----------



## presidenttttt

But someone on twitter said it was going to the moon? I am going to stick to punting on horses for another while.


----------



## tecate

presidenttttt said:


> But someone on twitter said it was going to the moon? I am going to stick to punting on horses for another while.


I'm not sure what metrics you're using but as it stands today, it's 279% up on this day last year. 

Meanwhile Andreesen Horowitz are tripling down, announcing a $2.2 billion crypto investment fund.


----------



## WolfeTone

Dublinbay12 said:


> Which is contrary to your early stance that the government could not shut down miners.



Can you provide a direct quote to support that?
I'm only reading the part about not being able to move against miners without letting the cat out of the bag. Counter measures would be taken (ie miners move elsewhere), the attack would fail,  at worst temporary network disruption. 

That does appear to be what has/is happening.


----------



## WolfeTone

Dublinbay12 said:


> There we have it. Black and white,



But you have edited his/her quote to present a different meaning, you have left out the rest of the comment that would , inconveniently for you, give a whole different context.
We can all do that, here is something you said earlier



Dublinbay12 said:


> It is simply fact [_edit_] to say that the Bitcoin code base cannot be changed.


----------



## DublinHead54

WolfeTone said:


> But you have edited his/her quote to present a different meaning, you have left out the rest of the comment that would , inconveniently for you, give a whole different context.
> We can all do that, here is something you said earlier



I did not edit, I quoted directly. Sure go ahead and paste the entire quote, the interpretation is the same.

You've successfully changed the topic to the interpretation of a quote rather than the underlying point. Can we get back to it? 

* Are you disagreeing that the Chinese government can close down miners? *


----------



## DublinHead54

For some the below article will present useful analysis, for others it will be decried as 'FUD'. I can bet who will do that.









						Bitcoin hashrate drops by nearly 50% following China's mining crackdown
					

Bitcoin hashrate, or the total computational power to mine the cryptocurrency, has dropped by nearly 50% in over a month.




					www.theblockcrypto.com
				




This is a great example of how central governments can impact the network. I for one think although this may cause a lot of short term volatility and slow the adoption of the network, it will be a long term benefit. Having a 'decentalized' network with a 65% mining concentration in a totalitarian Country was not sustainable.

Though as we have seen these private mining organizations are moving to countries like Kazakstan that will be favourable to their business model. I hope this reduces the mining concentration and the chance of a 51% attack.

I'm still bearish overall on BTC adoption as anything more than a store of value for a small minority. This is already seen by a few players getting a dominant stake in the share of supply. It will be interesting to see if MicroStrategy can maintain their strategy and pay their debts if BTC continues its downward trajectory. I found it interesting that Microstrategy had to turn to established financial markets and fiat currency to fund their Bitcoin purchases.

Lastly, ironically a system that was designed to remove the need for trusted third parties now entirely relies on trusted third parties. For the average joe or the unbanked market entry is via an exchange (third party). The network relies on private corporations (miners) to run rather than the peer to peer network first established. I will concede that due to the increasing power required to execute PoW that it was foreseen it would require large purpose-built mining operations.

However, for the average user there is trust required in using the BTC network, so the question becomes for the average person. Who do you trust more, the government or Coinbase?

(I fully expect @tecate to refuse to comment on this, as he knows it is a flaw in the adoption).


----------



## WolfeTone

@Dublinbay12 that is the point, the interpretation is NOT the same

Here is the full sentence 


tecate said:


> The Chinese can't move against these miners _without letting the cat out of the bag that something is afoot_



You deliberately left the second part of the sentence (in italics) out of your quote in order to portray an absolutist position, when in fact @tecate comment was conditional. 

Of course governments can move against miners - cutting off electricity supplies one be one way. But the point being made as I understand it is that this would signal to the network to that an attack is underway and the network would respond in kind by mobilising miners elsewhere, El Salvador would seem like a mining friendly country for instance. 
So the attack would fail. At most just network disruption for a period, as tecate went on to say. 
Which appears to be exactly the case.


----------



## DublinHead54

WolfeTone said:


> @Dublinbay12 that is the point, the interpretation is NOT the same
> 
> Here is the full sentence
> 
> 
> You deliberately left the second part of the sentence (in italics) out of your quote in order to portray an absolutist position, when in fact @tecate comment was conditional.
> 
> Of course governments can move against miners - cutting off electricity supplies one be one way. But the point being made as I understand it is that this would signal to the network to that an attack is underway and the network would respond in kind by mobilising miners elsewhere, El Salvador would seem like a mining friendly country for instance.
> So the attack would fail. At most just network disruption for a period, as tecate went on to say.
> Which appears to be exactly the case.



@WolfeTone please see post 994, in which I quoted in full at the start of this topic.

*Just to clarify, you are agreeing with my original point in post 994 and that the evidence isn't FUD? *

Based on your interpretation of Tecates stance, why have we seen an almost 50% decrease in the Hashrate? Surely per Tecates stance that chinese government movement to shutdown would fail, we wouldn't have seen this. The argument is a bit contradictory. 

I've come to expect that at this point. There is always a point put in that is vague enough to allow a flip flop when things change.


----------



## WolfeTone

Dublinbay12 said:


> *Just to clarify, you are agreeing with my original point in post 994 and that the evidence isn't FUD? *



No I am not agreeing with your original point at all. You have interpreted a comment to mean something else that is different from my interpretation.
You are trying to portray a comment by another user as absolutist when clearly the comment, when read in its full context, was conditional.


Dublinbay12 said:


> Further, do you have a view on when the hash rate will return to the levels seen prior to the China shutdown? I would think it isn't as seamless as you portray?



If you think I am portraying it as "seamless" then that is another misinterpretation on your part. 

The article you posted in #1013 is a good example of how the Chinese government move against miners is FUD by way of mining operations moving to more bitcoin friendly territory.


----------



## DublinHead54

WolfeTone said:


> No I am not agreeing with your original point at all. You have interpreted a comment to mean something else that is different from my interpretation.
> You are trying to portray a comment by another user as absolutist when clearly the comment, when read in its full context, was conditional.



There we have it.....the arguments are always conditional. You clearly would rather debate interpretations rather than content, I've tried to engage with you multiple times on the topic at hand (China shutdown), and you keep bringing it back to an interpretation. By the way interpretations, are subject to a different opinion. For context, there were subsequent discussions with Tecate on Chinas ability to intefere with BTC. They firmly believed that China shutdown was FUD, and would not happen, but I digress. 

If you still want to talk about interpretations rather than content, I won't engage with you. If you would like to discuss, please see below. 



_At the end of the day, an external party (China Government), has shut down a significant portion of the mining pool in the last month resulting in the hashrate dropping by ~50%. This poses a threat to the stability of the network and the underlying price. The news of the shutdown has been a clear factor in the downward price pressure. 

The hypothesis presented by @WolfeTone is that a china shutdown constitutes an attack and this would fail because the miners would move to other geographies. This has not yet happened at scale, thus in my opinion the argument is too open ended. There should rather be a discussion on the short term impacts to BTC adoption and price because of this shutdown. The other aspect is that these private mining organizations rely on 'friendly' countries with cheap electricity, so what are the options. 

Overall, I really fail to see how anybody with knowledge of BTC can simply brush this under the carpet by calling it FUD or assuming the miners can just move easily. _


----------



## WolfeTone

Dublinbay12 said:


> You clearly would rather debate interpretations rather than content,



It's important that if you want to 'debate' content that you are then open to others having different interpretation of that content.

Clearly we interpret tecates post differently. 

I also interpret the content you posted in #1013 differently to how you interpret it. 

You seem upset 



Dublinbay12 said:


> If you still want to talk about interpretations rather than content, I won't engage with you.





Dublinbay12 said:


> I really fail to see how anybody with knowledge of BTC can simply brush this under the carpet by calling it FUD or assuming the miners can just move easily.



I'm not brushing it under the carpet nor am I assuming miners can just move easily. 
The FUD is with regard to some notions that what is occuring that it represents a 51% attack by Chinese authorities on the network. It does not. It is disruptive to the network for sure, and how long will it take for mining operations to come on scale I do not know. 
In the long-run, what is happening in China is a good thing as I interpret it to mean that any prospective 51% attack by State agents is being significantly reduced, albeit in short to medium term, it is disruptive to the network.


----------



## DublinHead54

WolfeTone said:


> I'm not brushing it under the carpet nor am I assuming miners can just move easily.
> The FUD is with regard to some notions that what is occuring that it represents a 51% attack by Chinese authorities on the network. It does not. It is disruptive to the network for sure, and how long will it take for mining operations to come on scale I do not know.
> In the long-run, what is happening in China is a good thing as I interpret it to mean that any prospective 51% attack by State agents is being significantly reduced, albeit in short to medium term, it is disruptive to the network.


Where are these notions? Correct me if I am mistaken but it was you and Tecate who introduced a 51% attack in recent posts? Certainly none of the links or comments I have posted reference a 51% attack. A 51% attack of the Network is entirely different to what the Chinese government are doing lol. A state agent performing a 51% attack would require them to be running nodes themselves and trying to obtain 51% of the hashrate, and thus being able to force a new chain. Or taking over the mining operations and running them as state owned entities. I'm not sure if you fully understand the concept of a 51% attack an the difference to what China did?

But look this is an example where you/Tecate have introduced a different topic to detract from the point trying to be discussed.

Your last comment is a point I have made earlier, but again, it was not the point I was trying to engage with you on. I'll try again.....

What do you think the impact of this shutdown in China will have in the short term for the price and adoption?


----------



## Duke of Marmalade

The clamp down on Chinese miners is in my book a minor positive for bitcoin and possibly explains the dead cat bounce after the knee-jerk fall to below $30k.
@WolfeTone says "(it) is disruptive to the network for sure" .  Not at all.  The integrity of the blockchain is not in the hashrate but in the 10 minutes delay built into the protocol.  The difficulty level in PoW had risen to 21trillion its original difficulty because of the increase in hashrate.  The hashrate could further reduce immensely without compromising the blockchain one iota.


----------



## WolfeTone

Dublinbay12 said:


> Correct me if I am mistaken but it was you and Tecate who introduced a 51% attack in recent posts?



Ok, I will correct you. The discussion about a 51% attack was introduced way back in thread. It was in the context of a 51% that tecate made his comment about attacks on miners, at least that is how I interpreted it. You appear to have interpreted it that s/he was talking about any sort of attack at all. 

You confirm it here



Dublinbay12 said:


> 51% attack of the Network is entirely different to what the Chinese government are doing



So can the Chinese shutdown mining operations, yes of course. Same way they could shutdown their airports and disrupt international airline traffic network.


----------



## DublinHead54

WolfeTone said:


> Ok, I will correct you. The discussion about a 51% attack was introduced way back in thread. It was in the context of a 51% that tecate made his comment about attacks on miners, at least that is how I interpreted it. You appear to have interpreted it that s/he was talking about any sort of attack at all.
> 
> You confirm it here
> 
> 
> 
> So can the Chinese shutdown mining operations, yes of course. Same way they could shutdown their airports and disrupt international airline traffic network.



Why would the Chinese government be interested in carrying out a 51% attack when they can just shut the miners down lol? 

It is pretty clear to anybody that follows the market, China's interference was never ever about mounting a 51% attack. Do you have evidence suggesting the opposite? So you are basically trying to argue that the sky isn't blue. 

I guess you've no interest in discussing the impact, but good to see you've hedged your bets for future by saying it'll cause network distruption without offering anything else up.


----------



## tecate

WolfeTone said:


> The discussion about a 51% attack was introduced way back in thread.





			
				tecate said:
			
		

> *Chinese Miners Do Not Provide a Credible Threat to Bitcoin's Decentralised Peer to Peer Network*
> There is no realistic and credible threat to the bitcoin network from any Chinese entity - be that a corporation or the Chinese government. On mining pools, participants can move from one mining pool to another dynamically - they're not locked in. If the controller of a mining pool worked against their interest they wouldn't be long in doing that.
> If it cost X billion to carry out an *attack *on the network and the potential upside was much less than the cost of the *attack*, what participant in a mining pool is going to be down with that?
> 
> On the government threat - firstly, they would need a motivation. Who would they be *attacking* in going to all that effort? But for all intents and purposes, lets assume that the Chinese government have one. Mining farms are cast all over China - often in remote inaccessible locations. The Chinese can't move against these miners without letting the cat out of the bag that something is afoot. Counter measures would be taken. The *attack* would fail. At worst it would cause temporary network disruption. As with all other *attacks*, such an eventuality would only serve to make the network stronger in the longer term.
> 
> Would greater geographical distribution of mining facilities be optimal? Sure. Notwithstanding that, any reasonable appraisal of the current threat potential that I've come across doesn't suggest that such an eventuality would destroy bitcoin. Beyond that, I do see greater distribution of such facilities in other regions as we move forward. We've already seen increased growth in that regard in regions such as North America. Of course for the Roubini's of this world that have a hatred for bitcoin, such individuals will latch on to any old rubbish without even handed assessment simply because its useful to them in casting fear, uncertainty and doubt.





			
				tecate said:
			
		

> Asking miners to leave a territory is not an attack on the network. A 51% attack would involve much more than asking miners to leave a territory within a timeframe.


----------



## WolfeTone

Dublinbay12 said:


> Why would the Chinese government be interested in carrying out a 51% attack when they can just shut the miners down lol?



I've no idea, lol!



Dublinbay12 said:


> It is pretty clear to anybody that follows the market, China's interference was never ever about mounting a 51% attack.



Yes, that is what is being said to you. Perhaps you can elaborate and explain what China's interference is about?



Dublinbay12 said:


> So you are basically trying to argue that the sky isn't blue.



Well, technically speaking it isn't.... lol! Let's no go there!


Dublinbay12 said:


> I guess you've no interest in discussing the impact



I am interested in discussing the impact. I'm interested in learning what is the impact. 
As @Duke of Marmalade points out, it is probably a positive for bitcoin.


----------



## DublinHead54

WolfeTone said:


> I've no idea, lol!
> 
> 
> 
> Yes, that is what is being said to you. Perhaps you can elaborate and explain what China's interference is about?
> 
> 
> 
> Well, technically speaking it isn't.... lol! Let's no go there!
> 
> 
> I am interested in discussing the impact. I'm interested in learning what is the impact.
> As @Duke of Marmalade points out, it is probably a positive for bitcoin.



As did I.......


Dublinbay12 said:


> For other readers of this thread, I actually think the China crackdown is good as it decreases centralization of mining and reduces the chance of a 51% attack which is bringing the network back towards the original plan.


----------



## tecate

WolfeTone said:


> Yes, that is what is being said to you. Perhaps you can elaborate and explain what China's interference is about?


Think about this Wolfie. If it was never about an attack, then why was it being dredged up as a criticism of btc repeatedly? So apparently then it was about a ban rather than an attack? Well, the ban is being implemented right now and nobody seems to think that this is a bad thing!

Ergo, all of this criticism was Fear / Uncertainty / Doubt -> FUD.


----------



## Duke of Marmalade

There is one very unlikely scenario where a fall in the hashrate could be fatal.  The hashrate has fallen by 50% they say.  The 10 minutes is maintained by halving the difficulty. No problem.  And this can continue almost ad infinitum as the difficulty level is currently over 10trillion times its starting level.
But if the hashrate fell so suddenly that the protocol had not yet recalculated the difficulty then until that new difficulty is reset the average time to solve the hash puzzle would increase.  So whilst a 1,000 fold reduction in hashrate is easily accomodated if it happens over a reasonable time period, if it happened all at once it would take 10,000 minutes (1 week) to add the next block    Just a theoretical musing dear cultists, it is as likely to happen as everybody winning the lottery next week.


----------



## DublinHead54

Ok so any reporting that dares criticise or present a negative opinion is FUD? What a load of rubbish. If that were true then it seems some people on here have authoritarian views when it comes to bitcoin. It's such a weak defence to just call a news story FUD, especially when said reporting comes from respected crypto news outlets.

I guess I should just come to this forum for the truth*.


*Truth according to Tecate


----------



## WolfeTone

Dublinbay12 said:


> Ok so any reporting that dares criticise or present a negative opinion is FUD?



No, just the criticism that has been levelled here.


----------



## Duke of Marmalade

Dublinbay12 said:


> Ok so any reporting that dares criticise or present a negative opinion is FUD? What a load of rubbish. If that were true then it seems some people on here have authoritarian views when it comes to bitcoin. It's such a weak defence to just call a news story FUD, especially when said reporting comes from respected crypto news outlets.
> 
> I guess I should just come to this forum for the truth*.
> 
> 
> *Truth according to Tecate


You are dealing with a cult.  Imagine you are discussing the meaning of life with, say, Muslims, you are on eggshells when the subject of the Prophet comes up.  I have spent a long time in these parts mocking the cult until it suddenly dawned on me, I am effectively insulting these guys' religion, something which we all accept is quite non PC.


----------



## tecate

Duke of Marmalade said:


> You are dealing with a cult.


And the 'cult' labeling is being applied to a group of people who's ideas you are ideologically opposed to. So a difference of ideas is being debated but the establishment set decide to label the upstarts with the 'cult' tar and feathering. Tell me, Marmalady, what gives your ideas on the subject a free pass whilst those you oppose get the 'cult' tar and feathering?
I mean, people can decide to 'mock', to label & tar and feather, to be all about demonstrating how 'wrong' someone is/was  - OR - we could just stick to the nuts and bolts of the  subject area and consider it.


----------



## WolfeTone

Duke of Marmalade said:


> I have spent a long time in these parts mocking the cult



Yes, I think it started at a point when bitcoin was less than a $1,000?....it's been a blast!


----------



## Duke of Marmalade

WolfeTone said:


> Yes, I think it started at a point when bitcoin was less than a $1,000?....it's been a blast!


Actually, I stand to be ejected here, I think it started in late 2018 when it soared to $20k.  It has grown 50% since then but relative to its volatility that is not actually a good Sharpe Ratio.  Admittedly I would have been predicting something closer to -100%


----------



## tecate

Duke of Marmalade said:


> Actually, I stand to be ejected here, I think it started in late 2018 when it soared to $20k.  It has grown 50% since then but relative to its volatility that is not actually a good Sharpe Ratio.  Admittedly I would have been predicting something closer to -100%


That's inaccurate, Marmalady. You first stated on 13 Feb 2015 that Bitcoin was 'a load of baloney'. The price on that day was $230/bitcoin. Between then and now, we've seen a price increase of 13,421% ( or 27,726% by comparison with the ATH price from earlier this year). Nouriel has outdone you though - he's been criticising the hell out of bitcoin since it was at $13.
Over its 12 years, bitcoin has averaged a 213% increase per annum. The charge that bitcoin has a poor Sharpe Ratio is inaccurate.


----------



## Duke of Marmalade

tecate said:


> That's inaccurate, Marmalady. You first stated on 13 Feb 2015 that Bitcoin was 'a load of baloney'. The price on that day was $230/bitcoin. Between then and now, we've seen a price increase of 13,421% ( or 27,726% by comparison with the ATH price from earlier this year). Nouriel has outdone you though - he's been criticising the hell out of bitcoin since it was at $13.
> Over its 12 years, bitcoin has averaged a 213% increase per annum.


Ok.  I'm ejected, though my serious engagement did begin in late 2018.
I am certainly not claiming that there is any price at which I would have been singing a different tune.  It would always have been BOHA to me.


----------



## tecate

Duke of Marmalade said:


> Ok.  I'm ejected


Don't fret Marmalady, it's the weekend so here's a gift from the other side of the pond.


----------



## DublinHead54

The rhetoric on this thread is that Bitcoin is going on a journey of adoption. As such there have been claims that volatility is expected as part of the adoption cycle and it will reduce over time as the asset matures. 

What's evident in the last 3 months that BTC is as volatile as ever despite the network growth. Examples being PayPal adoption, Coinbase IPO, Tesla, El Salvador to name a few. These are examples that have been posted by those on this forum as evidence of Bitcoins growth, legitimacy and adoption. However, volatility remains high. 

I've seen the argument presented that it took hundreds of years for gold to become stable. But today is a different world. We live in a connected global economy where technology adoption is rapid. For example, it took less than a decade for Smartphones to become dominant. So I'm not sure the 'it takes time' argument holds much weight. Now BTC adoption is difficult given its in competition against governments, but the will of the people is powerful. 

But I'd like to hear from @WolfeTone on his views on what will need to happen for BTC to become less volatile?


----------



## DublinHead54

A good example of how the Bitcoin network does use 'trusted' third parties (exchanges) and the security issues with it. Not your keys, not your coins....









						Founders of South African Crypto Investment Firm – and $3.6B in Bitcoin – Are Missing
					

Africrypt investors were told not to inform police of the purported hack because it could slow the recovery of their funds.




					www.coindesk.com


----------



## WolfeTone

Dublinbay12 said:


> The rhetoric on this thread



Is also about the Chinese crackdown on bitcoin mining and how, in the end, we all agreed it was most likely a positive for bitcoin. 



Dublinbay12 said:


> What's evident in the last 3 months that BTC is as volatile as ever despite the network growth.



And I would suggest it will remain so for sometime. Bitcoin, in the grand scheme of global finance and money is tiny. 



Dublinbay12 said:


> For example, it took less than a decade for Smartphones to become dominant.



Smartphones operate on a massive infrastructure that is financed, regulated and co-ordinated by private tech companies and telecommunications regulators employing tens of thousands of people in roll-out, support and maintenance etc. 
Bitcoin is an 8 page posting on a fringe tech site. 
There is simply no comparison. 



Dublinbay12 said:


> But I'd like to hear from @WolfeTone on his views on what will need to happen for BTC to become less volatile?



Much more wider adoption. Cannot say definitively, but a ten-fold increase in adoption seems like a good starting point.


----------



## Duke of Marmalade

tecate said:


> Don't fret Marmalady, it's the weekend so here's a gift from the other side of the pond.
> 
> View attachment 5663


Agreed, the Central Banks have told us as much. They aim to reduce its value by 2% p.a. which *eventually *will be as close to zero as makes no difference.  So long as it can reasonably be trusted to buy a Big Mac at near enough current prices for the next year or so, that is all that is required of a medium of exchange.

_*Crypto will quickly go to its intrinsic value - zero*_
*Duke of Marmalade, 21st Century*


----------



## DublinHead54

WolfeTone said:


> Much more wider adoption. Cannot say definitively, but a ten-fold increase in adoption seems like a good starting point.



What does much wider adoption translate into? 10 more countries accepting it as legal tender? 

In your opinion does it need more adoption to become less volatile? If BTC is tiny in terms of Global finance, do you not think that limits its potential for adoption? What do you think will change to lead to 10x adoption?


----------



## WolfeTone

Dublinbay12 said:


> What does much wider adoption translate into?



Hard to define, I mentioned a ten-fold increase as a starting point.


Dublinbay12 said:


> In your opinion does it need more adoption to become less volatile?



Yes, in my opinion it does.



Dublinbay12 said:


> If BTC is tiny in terms of Global finance, do you not think that limits its potential for adoption?



It may limit its potential adoption but bitcoin, as you know, is divisible to 100million satoshi's. So there is potential for everyone on the planet - with a smartphone and internet connection - to acquire some. 
I don't think we are anywhere near that occuring yet.



Dublinbay12 said:


> What do you think will change to lead to 10x adoption?



I'm not sure, it may never happen...I am just open to the possibility that it could occur.


----------



## Duke of Marmalade

Adoption?  Adoption as what?  The only adoption that can have any hope of reducing volatility is adoption as a utility and the only possible utility it can fulfil is as a medium of exchange (John Kelleher, Investopedia).  To all intents its current adoption as a medium of exchange is non existent.  
The current price is purely speculation about what its price will be in future - that is destined to be hopelessly volatile.


----------



## tecate

Duke of Marmalade said:


> _*Crypto will quickly go to its intrinsic value - zero*_
> *Duke of Marmalade, 21st Century*


This is a tough one - the House of Voltaire vs. the House of Marmalade. I'd have to say that when I think Voltaire, I think prolific, insightful scriblings - when it comes to the House of Marmalade, all I can think of is Fruitfield.  Sorry your dukeness but I'll have to go with Voltaire on this one.


Duke of Marmalade said:


> Adoption?  Adoption as what?  The only adoption that can have any hope of reducing volatility is adoption as a utility and the only possible utility it can fulfil is as a medium of exchange (John Kelleher, Investopedia).  To all intents its current adoption as a medium of exchange is non existent.
> The current price is purely speculation about what its price will be in future - that is destined to be hopelessly volatile.


Ah, John makes another guest appearance. It's a shame the guy is up to his eyeballs building away in DeFi - or we could invite him on here on your behalf, Dukey. So what you're saying is that it's the _wrong_ type of adoption? I see.


----------



## Duke of Marmalade

tecate said:


> So what you're saying is that it's the _wrong_ type of adoption? I see.


Absolutely.
Surely you agree (a) its main adoption today is as a speculation and (b) that can only be volatile.
I think you see some adoption as a "store of value" which seems to be the case (does NOT mean I think it is a sov) and that should be a tad less volatile.
And I agreed that Voltaire was spot on, fiat money by design will eventually approach zero.


----------



## tecate

Duke of Marmalade said:


> Absolutely.
> Surely you agree (a) its main adoption today is as a speculation and (b) that can only be volatile.
> I think you see some adoption as a "store of value" which seems to be the case (does NOT mean I think it is a sov) and that should be a tad less volatile.
> And I agreed that Voltaire was spot on, fiat money by design will eventually approach zero.


There's a bit of a distinction. On the nocoiner side of the discussion, people have tended to say, look! speculation - on the assumption that it's a nothing burger. Speculative interest is a huge aspect of all markets whether we see that as productive or not. My view is that sure, there has been a large speculative interest - and there continues to be on the promise of the tech. That's what that speculation is based on (and of course these are tech-based hype cycles so people can get ahead of themselves - but that doesn't mean to say that they're wrong about there being something tangible at the heart of it). Oftentimes, I've pulled people up here for passing judgement on the tech when it - and its infrastructure/regulatory framework/eco-system is still in development. Everyone wrote btc off when it comes to means of exchange and I had done so on a temporary basis i.e. I accepted that bitcoin had challenges in that respect. And yet, now we have some further adoption as a means of exchange. Where there were several barriers (transaction time, transaction cost, transaction through-put), now there's only one (volatility) - and in the case of El Salvador, they've come up with a mechanism to deal with that - whilst still making use of bitcoin the network and bitcoin as a means of exchange.
On store of value, it's still in development but it has certainly made a decent start on that. I just listened to an interview with the CIO of a gold based securities company and I was quite impressed with the development of his view (when you bear in mind he has every reason to shout it down given he's in the gold business). Go back to when we opened this chain of discussions - there's no earthly way that a guy like him would hold such a view. That's all part and parcel of the move towards greater adoption.

Otherwise, the numbers don't lie. On-chain data confirms ever increasing activity/new wallets, etc - over the course of the 4 years we've discussed this - year on year.


----------



## DublinHead54

WolfeTone said:


> Yes, in my opinion it does.


How did you arrive at that opinion?



WolfeTone said:


> It may limit its potential adoption but bitcoin, as you know, is divisible to 100million satoshi's. So there is potential for everyone on the planet - with a smartphone and internet connection - to acquire some.
> I don't think we are anywhere near that occuring yet.


How do you feel about inequality in the system In that scenario? Those with thousands of BTC and those with a fraction? Do you then believe the BTC $ price needs to be much higher to make 1 sathoshi useful?


----------



## Duke of Marmalade

tecate said:


> There's a bit of a distinction. On the nocoiner side of the discussion, people have tended to say, look! speculation - on the assumption that it's a nothing burger. Speculative interest is a huge aspect of all markets whether we see that as productive or not. My view is that sure, there has been a large speculative interest - and there continues to be on the promise of the tech. That's what that speculation is based on (and of course these are tech-based hype cycles so people can get ahead of themselves - but that doesn't mean to say that they're wrong about there being something tangible at the heart of it). Oftentimes, I've pulled people up here for passing judgement on the tech when it - and its infrastructure/regulatory framework/eco-system is still in development. Everyone wrote btc off when it comes to means of exchange and I had done so on a temporary basis i.e. I accepted that bitcoin had challenges in that respect. And yet, now we have some further adoption as a means of exchange. Where there were several barriers (transaction time, transaction cost, transaction through-put), now there's only one (volatility) - and in the case of El Salvador, they've come up with a mechanism to deal with that - whilst still making use of bitcoin the network and bitcoin as a means of exchange.
> On store of value, it's still in development but it has certainly made a decent start on that. I just listened to an interview with the CIO of a gold based securities company and I was quite impressed with the development of his view (when you bear in mind he has every reason to shout it down given he's in the gold business). Go back to when we opened this chain of discussions - there's no earthly way that a guy like him would hold such a view. That's all part and parcel of the move towards greater adoption.
> 
> Otherwise, the numbers don't lie. On-chain data confirms ever increasing activity/new wallets, etc - over the course of the 4 years we've discussed this - year on year.


In the volatility stakes which we are currently talking about
Speculative=Super Volatile
SoV=Volatile
MoE=Stable


----------



## tecate

Duke of Marmalade said:


> In the volatility stakes which we are currently talking about
> Speculative=Super Volatile
> SoV=Volatile
> MoE=Stable



I'm not sure why you want to split it down in that way Duke - but whatever floats your boat. I have not seen anyone claim bitcoin not to be volatile - so that's accepted. Otherwise, we have gotten rid of some other previous objections - such as transaction cost, transaction time and transaction through-put. It's taken a few years to bring that about. It will take multiple years for volatility to calm down.
For those that are in to speculation, volatility is the opportunity. If everyone agreed it works right out of the gate, there would be little or no opportunity. As a store of value, sure volatility isn't ideal - but so long as people zoom out, at the end of the day it's averaging 213% increased buying power per annum.
Volatility is least welcome as a means of exchange. However, as I mentioned, El Salvador has come up with a mechanism to allow people to make use of it and its network without necessarily exposing themselves to that volatility. As someone who would like to use bitcoin on a more frequent basis, I'd like to see more of this. At the end of the day, it doesn't have to be the unit of account. For anyone in Latin America, there is resistance to visa payment - and either they won't accept that or they want to add on 4-5% surcharge. So if you're travelling to such places, bitcoin can serve a purpose. Remittances - we've discussed already. El Salvadorans can improve their lot through remittances alone via bitcoin. If their spending power goes up, their government collects more in taxes. There's an MP in Tonga trying to put together a similar proposal where remittances are responsible for 45% of GDP.


----------



## WolfeTone

Dublinbay12 said:


> How did you arrive at that opinion?



Well I am of the view that the greater the rate of participation the less likely (or more difficult it will become for) any individual, or small groups of individuals, to manipulate market prices for their own benefit. Thus provide less volatility. 
That said, I'm starting to perceive that it is fiat currency that is volatile against 1 BTC



Dublinbay12 said:


> How do you feel about inequality in the system In that scenario? Those with thousands of BTC and those with a fraction?



You get what you pay for. In my opinion, bitcoin will not survive long term without a significant increase in participation from the global population, driving up the price.
A significant increase in participation by the global population will occur when large holders of bitcoin dilute some of their holdings (over time) driving down the price.
It's a slow-burner, this has a long way to go.



Dublinbay12 said:


> Do you then believe the BTC $ price needs to be much higher to make 1 sathoshi useful?



No, I think 1 satoshi is useful at any price. It is digital property.


----------



## DublinHead54

WolfeTone said:


> Well I am of the view that the greater the rate of participation the less likely (or more difficult it will become for) any individual, or small groups of individuals, to manipulate market prices for their own benefit. Thus provide less volatility.


Are you suggesting that volatility is the result of market manipulation? That doesn't make sense, and if it were true would pose serious questions about an asset that after 10 years and some significant adoption can still be manipulated. 



WolfeTone said:


> You get what you pay for. In my opinion, bitcoin will not survive long term without a significant increase in participation from the global population, driving up the price.
> A significant increase in participation by the global population will occur when large holders of bitcoin dilute some of their holdings (over time) driving down the price.
> It's a slow-burner, this has a long way to go.



To quote Tecate (directly)


tecate said:


> On-chain data confirms ever increasing activity/new wallets, etc - over the course of the 4 years we've discussed this - year on year.


We have seen that it is not a correlation factor of 1 i.e. the price does not only go up when participation increases. Recently BTC dropped 50% from its all time high (ATH) yet participation is at an ATH. So I don't think you can say that an increase in participations will drive up the price.

Also, it seems you have contradicted yourself. In the first sentence, you say the increase in participation will drive up the price but then move on to say the increase in participation will require large holders of Bitcoin to dilute some of their holdings driving down the price. Your last sentence makes BTC sound like a ponzi scheme...early investors cashing out leaving others holding the bag.


----------



## Duke of Marmalade

tecate said:


> I'm not sure why you want to split it down in that way Duke -


We are talking about volatility.  @WolfeTone correctly identifies that volatility is closely related to "adoption".  I was pointing out that adoptoin takes several forms all with different volatility impacts.  If adoption is merely increased speculation that spells even more volatility, indeed one might question whether speculation should even be described as adoption.
This year has to an extent been about store of value adoption by institutions.  This should have been a stabilising influence but the overbearing influence of El Musk has had the opposite effect.  Also it seems to me that last year's much heralded forthcoming adoption by institutions as sov or reserve asset hasn't materialised.
I would ask @WolfeTone which form of adoption was he referring to.


			
				Wolfie said:
			
		

> That said, I'm starting to perceive that it is fiat currency that is volatile against 1 BTC


Please, you're better than that.  Some high priest of the cult, earlier cited by @tecate, tried that one.  The volatility of a currency is measured with regard to its spending power in terms of goods and services.  By design the major fiat currencies are remarkably stable in that regard at the current time whilst bitcoin most certainly isn't.  Why else did Bukele guarantee retailers their bitcoin sales in $?
I hope you are not pitching to be Bukele's PR man for bitcoin:
_"Go on have a punt, you have nothing to lose, it could be you.
Bitcoin isn't volatile, it is those nasty gringo dollars that are volatile"_


----------



## WolfeTone

Dublinbay12 said:


> Are you suggesting that volatility is the result of market manipulation? That doesn't make sense, and if it were true would pose serious questions about an asset that after 10 years and some significant adoption can still be manipulated.



No I am not saying the volatility is the result of market manipulation, I am saying that the greater participation then the less liklihood the market prices are open to manipulation. 
I am of the view that in most markets there are participants willing to manipulate prices for what they perceive to be to their advantage, or in the case of CB and government participation, for what they perceive to be to the advantage of the economy and society as a whole. 
Don't you think the unprecedented levels of money printing are at a base level for the purposes of manipulating money markets? 




Dublinbay12 said:


> So I don't think you can say that an increase in participations will drive up the price



You have a habit of jumping to conclusions on the expression of simple sentences. It is not a given that increased participation will drive up price. I come from the perspective that, relative to the global Internet, smartphone population, participation in bitcoin is tiny. Meaning the prospective levels of potential participation are massive, and in my view, would more than likely prompt price increase over the long term. 


Dublinbay12 said:


> Your last sentence makes BTC sound like a ponzi scheme...early investors cashing out leaving others holding the bag.



You could choose to think that way and no doubt many people do. I certainly spent a period considering if bitcoin was a ponzi scheme or not. 
I have come to the conclusion that it is not.


----------



## tecate

Duke of Marmalade said:


> We are talking about volatility.  @WolfeTone correctly identifies that volatility is closely related to "adoption".  I was pointing out that adoptoin takes several forms all with different volatility impacts.  If adoption is merely increased speculation that spells even more volatility, indeed one might question whether speculation should even be described as adoption.
> This year has to an extent been about store of value adoption by institutions.  This should have been a stabilising influence but the overbearing influence of El Musk has had the opposite effect.  Also it seems to me that last year's much heralded forthcoming adoption by institutions as sov or reserve asset hasn't materialised.



Ok, I think I see where you're going with that. That's fair enough - I can see a certain logic in it. But lets not get ahead of ourselves. If you zoom out on metrics like no. of active wallets or the price of bitcoin - these can be seen to go upward and to the right. Zoom in and you'll see the volatility. I'm encouraged by that progress but it's still just in the ha'penny place.

The reason I say we shouldn't get ahead of ourselves is that sure, it has edged forward in terms of adoption but it is just edging forward. The likes of Microstrategy and Telsa getting involved were the first movers in terms of corporate/institutional adoption. But they're only just the tip of the iceberg in terms of full involvement.  ETFs have been rolled out this year in Canada, Brasil and elsewhere - but a bitcoin ETF still remains elusive in the US. You'll recall the Ross Steven's interview that you listened to - where he suggested that high street banks will be making btc available to customers. We had the first high street bank in Europe ( Saxo in Denmark) enable this last week.

These are just examples - in a given week these days - there's a whole host of significant developments. The reason I mention these things is that with all of this type of activity going on in the background, nobody could possibly expect anything but volatility. I think by now we've also established that there is no earthly way that bitcoin could have been pushed out and automatically find its price. Yet many people think that there's no earthly reason for its volatility but its an inevitable part of its ongoing development.

As regards retail newcomers adding to the volatility, I agree completely. This was touched on before to some extent but someone who has clown car'ed in to bitcoin solely on the basis of Elon and reversed back out on the same basis couldn't possibly have a decent understanding of what they were buying into (as in they have not thought it through whatsoever if they're relying solely on celebrity endorsement). You can say that this type of involvement is pointless. In the short term, I think its cringe-worthy. The same with people buying meme coins, etc. But over the longer term, it does serve a purpose. We've learnt from previous cycles that many people get drawn in - in hype cycles - but in the process they become familiar with bitcoin/crypto, comfortable in storing/transacting it - and they learn about the qualities and purpose that it has.

Isn't this the nature of tech-driven hype cycles? Have we not seen this before with other tech? The difference this time is that it centers on money and it has been entirely retail driven. I'm delighted that this came up with retail but there's no doubt that further institutional involvement (where they're prepared to take an approach that involves a much longer time horizon) will serve to dampen that shorter term volatility.

Outside of that, there's so much more that needs to mature. Later this year, bitcoin's first software upgrade in four years will take effect. That has implications for certain use cases relative to bitcoin going forward. Lightning Network is only just beginning to make some sort of impact (despite not being a completed project itself - its still being developed).  Regulation is still all over the place and has yet to settle. All of these moving parts don't assist with taming volatility in the short term.

All of that to say that its a mixture of a maturation of the tech and its ecosystem, further movement along the adoption curve and time that will lead to decreased volatility.



Duke of Marmalade said:


> _"Go on have a punt, you have nothing to lose, it could be you. Bitcoin isn't volatile, it is those nasty gringo dollars that are volatile"_



Thankfully, the Salvadorans are not pitching anything like that. In no way are they encouraging anyone to speculate on bitcoin. It's very clear what they want out of it -  to utilise bitcoin as a tool to circumvent the unbanked issue and allow Salvadorans and their government to reclaim millions in remittance fees. Secondly, to encourage foreigners to come and spend btc in the country and invest in the country. Although merchants are required to accept bitcoin, they are under no obligation to hold it - and can convert it automatically with no slippage.


----------



## Duke of Marmalade

@tecate that all seems to make sense. 
But just for clarity it was @WolfeTone who recommended that El Sals have nothing to lose and bitcoin could turn out to be a life changer, go on have a punt.  Also he has had a lightbulb moment where he now sees the $ as the culprit in the volatility of the btc/$ exchange rate.


----------



## DublinHead54

WolfeTone said:


> No I am not saying the volatility is the result of market manipulation, I am saying that the greater participation then the less liklihood the market prices are open to manipulation.
> I am of the view that in most markets there are participants willing to manipulate prices for what they perceive to be to their advantage, or in the case of CB and government participation, for what they perceive to be to the advantage of the economy and society as a whole.
> Don't you think the unprecedented levels of money printing are at a base level for the purposes of manipulating money markets?





WolfeTone said:


> Well I am of the view that the greater the rate of participation the less likely (or more difficult it will become for) any individual, or small groups of individuals, to manipulate market prices for their own benefit. *Thus provide less volatility.*



Wolfetone, I am responding and querying statements you make. You make the connection of volatility coming from market manipulation. If volatility is not the result of market manipulation why did you introduce the topic of market manipulation and expand on it by mentioning market manipulation of established governments when we were talking about adoption and volatility of BTC?  We are currently discussing Bitcoin, its adoption and volatility not QE by central bank governments, no need to change the topic. However, don't you see the contradiction in your statement? You are suggesting Central Banks manipulate the currency yet central bank currencies have no volatility. In addition adoption of Central banks is much larger than BTC and you say those central banks are manipulating markets.....that invalidates your claim than that with an increase in adoption of BTC will lead to less manipulation......




WolfeTone said:


> You have a habit of jumping to conclusions on the expression of simple sentences. It is not a given that increased participation will drive up price. I come from the perspective that, relative to the global Internet, smartphone population, participation in bitcoin is tiny. Meaning the prospective levels of potential participation are massive, and in my view, would more than likely prompt price increase over the long term.



Yesterday you were quick to discount my analogy of the adoption of the smarthphone (quoted below) as not comparable. If Bitcoin adoption requires an internet connection, and a smartphone which as you point out adoption is huge, what needs to happen for adoption? However, you didn't respond to my point on your contradiction that the price will go up but for adoption large holders will sell driving the price down. 


WolfeTone said:


> Smartphones operate on a massive infrastructure that is financed, regulated and co-ordinated by private tech companies and telecommunications regulators employing tens of thousands of people in roll-out, support and maintenance etc.
> Bitcoin is an 8 page posting on a fringe tech site.
> *There is simply no comparison.*





WolfeTone said:


> You could choose to think that way and no doubt many people do. I certainly spent a period considering if bitcoin was a ponzi scheme or not.
> I have come to the conclusion that it is not.



My assertations of a ponzi scheme was not my own view, but based on how you were presenting your vision of adoption. 

I think wolfetone, much like myself you don't know how BTC is going to play out in the future, and your attempts of rationalizing adoption are just educated guesses. That when I dig into them there is no real academic theory or examples to support it. 

However, I do think it is clear that the volatility is going to remain given BTC main use case is as a store of value and not a currency.


----------



## WolfeTone

Duke of Marmalade said:


> But just for clarity it was @WolfeTone who recommended that El Sals have nothing to lose and bitcoin could turn out to be a life changer, go on have a punt.



Eh, just to clarify the 'clarity'  I recommended no such thing. 
What I did say was that for the first time poor people could claim a stake on property. Something that is denied to them in near perpetuity under the fiat system. 
It was your suggestion that these poor El Salvadorians could lose everything they own. That there best bet was to stick with the status quo, to watch what meagre savings they have depreciate by a guaranteed 2%pa. 

I just an advocate of having a option to opt out of such a system. Bitcoin offers that option.


----------



## tecate

WolfeTone said:


> I just an advocate of having a option to opt out of such a system. Bitcoin offers that option.


Absolutely. When has choice ever been a bad thing.


----------



## WolfeTone

Dublinbay12 said:


> You make the connection of volatility coming from market manipulation.



Market manipulation can lead to a volatile market. It is not a given. My view is that the greater size market, both in terms of capital investment and the numbers of investors, the harder it will be for the price to be manipulated. Its not rocket science what I am saying. I'm using money markets as an example. So vast, and wielding is the international global financial system, only entities such as CB and governments have the wherewithal to manipulate the prices as they are being manipulated. 
That is not the case for bitcoin. We can see the impact that someone like Musk can have from his comments, inducing higher levels of volatility in bitcoin market than say the volatility of the Telsa market price, following his comments that it was overpriced. 
Volatility does not originate solely from manipulation, or attempted manipulation. It can occur for many reasons.


----------



## DublinHead54

WolfeTone said:


> I just an advocate of having a option to opt out of such a system. Bitcoin offers that option.



There is no such thing as a free lunch, and there are risks to El Salvadorians using BTC. Right now that is the fees (although lightning network can help), the volatility, the unbalanced ownership demographic and it being an immature asset.

Surely you can see that there is a risk involved for El Salvadorians? Even Tecate stated yesterday that BTC is only at the start of the adoption curve. He has also admitted previously that BTC needs to resolve issues. Shown below is the volatility overtime for BTC, clearly still a highly volatile asset.






Despite that, it is still your opinion that as of today EL Salvadorians should use BTC instead of Fiat which is depreciating at 2% pa? haven't you been able to live your life up until now with Fiat?


----------



## Duke of Marmalade

WolfeTone said:


> Eh, just to clarify the 'clarity'  I recommended no such thing.
> What I did say was that for the first time poor people could claim a stake on property. Something that is denied to them in near perpetuity under the fiat system.
> It was your suggestion that these poor El Salvadorians could lose everything they own. That there best bet was to stick with the status quo, to watch what meagre savings they have depreciate by a guaranteed 2%pa.
> 
> I just an advocate of having a option to opt out of such a system. Bitcoin offers that option.





			
				Wolfie a while back said:
			
		

> So there are risks for poor people in El Salvador getting involved in bitcoin. But how much poorer will they be if bitcoin returns to zero than had they not involved?
> On the other hand, if bitcoin shoots for the stars, then imagine for the first time in history poor people having some leverage for their own well-being and affairs.
> 
> The alternative, not buying bitcoin, seems to say to El Salvadorians - you are poor, you will stay poor, and as unfortunate as that is, that is the way it is and will be.


I don't think I was too outa line in paraphrasing this philosophy as "you have nothing to lose, but bitcoin might change all that" i.e. an appeal to the lotto mentality.


----------



## DublinHead54

WolfeTone said:


> Market manipulation can lead to a volatile market. It is not a given. My view is that the greater size market, both in terms of capital investment and the numbers of investors, the harder it will be for the price to be manipulated. Its not rocket science what I am saying. I'm using money markets as an example. So vast, and wielding is the international global financial system, only entities such as CB and governments have the wherewithal to manipulate the prices as they are being manipulated.
> That is not the case for bitcoin. We can see the impact that someone like Musk can have from his comments, inducing higher levels of volatility in bitcoin market than say the volatility of the Telsa market price, following his comments that it was overpriced.
> Volatility does not originate solely from manipulation, or attempted manipulation. It can occur for many reasons.



BTC is a volatile asset, an increase in adoption is not going to stop it being a volatile asset. That is simple a fact of its design. Thanks for clarifying what you meant when you liked BTC and its volatility due to market manipulation. Please feel free to provide any evidence / facts you have to debate that statement

I think the best way to put it is, that as regulation and effective controls are put in place the level of volatility of BTC may reduce in future or be more easily anticipated. But have a google (flash crash), to understand that in established financial market volatility still exists and this will be no different for how BTC operates today. I assume this is what you meant by introducing Musks market manipulation. 

I do want to clarify that your statement on CB and governments are the only entities manipulating prices as being incorrect. One example that comes to mind is the Libor Interest Rate scandal that was coordinated by private individuals to benefit a private corporation. Ask your friend Tecate, as he is often posting examples of market manipulation in support of BTC adoption. 

If there was no volatility then BTC would likely end up having some inflationary properties and then you wouldn't be advocating for it all.


----------



## Duke of Marmalade

WolfeTone said:


> That there best bet was to stick with the status quo, to watch what meagre savings they have depreciate by a guaranteed 2%pa.


I am not going to apologise for giving a brief economics lesson.
*Nobody *is recommending fiat as a good long term sov.  One of the great advantages in breaking from the gold standard is precisely that it does not have a long term sov.  When linked to gold there was always the risk that folk would HODL money which can be counter to its effectiveness as a medium of exchange.
The safest form of *fiat based* sov are deposits.  The current interest rate in El Sal is 3.8% so $ deposits are gaining value.  (Possibly poor folk do not have access to this interest rate but that is the fault of the El Sal government/financial system).
Here in Ireland state savings provide inflation beating returns which would satisfy the needs of the majority of folk.


----------



## DublinHead54

we've reached the peak......

This is absurd


WolfeTone said:


> That said, I'm starting to perceive that it is fiat currency that is volatile against 1 BTC


----------



## tecate

Duke of Marmalade said:


> I am not going to apologise for giving a brief economics lesson.






Duke of Marmalade said:


> *Nobody *is recommending fiat as a good long term sov.  One of the great advantages in breaking from the gold standard is precisely that it does not have a long term sov.


Ok, and so where do most people park their savings? Yes, they can buy equities but if we're talking about ordinary people that aren't so savvy, their savings end up in deposit accounts.

YOU are not recommending that Duke - but there is no such warnings to the general public on that. Most people don't fully understand inflation. Can you take your recommendation a step further and acknowledge that inflation is a stealth tax?
Can you acknowledge that its an inflationary system that has resulted in climate change (the irony that bitcoin gets a kicking on this basis!).



Duke of Marmalade said:


> One of the great advantages in breaking from the gold standard is precisely that it does not have a long term sov.


Great advantages!? Please.



Duke of Marmalade said:


> When linked to gold there was always the risk that folk would HODL money which can be counter to its effectiveness as a medium of exchange.


Disagree entirely. What you mean is that a Keynesian based economic system has to be kept fed at all costs.



Duke of Marmalade said:


> The current interest rate in El Sal is 3.8% so $ deposits are gaining value.  (Possibly poor folk do not have access to this interest rate but that is the fault of the El Sal government/financial system).


As you've indentified, null and void given that 70% of the population have been shut out of the banking system. As regards, who's to blame - all the stakeholders in the fiat system - i.e. a combination of government, central bank and general banking system/financial system.
Upon the announcement of El Salvador's bitcoin move, we had several people here say this could all be achieved via the banking system. Well - how many years did they have to achieve that?  Times up!

 Can your economics lesson clarify why the Lebanese kicked in the doors of their central bank the other night?


----------



## WolfeTone

Duke of Marmalade said:


> *Nobody *is recommending fiat as a good long term sov.



What would you recommend poor people to do? What is their best option to earn a return on capital and/or labour given they little to zero capital to invest and wage levels are derisory?


----------



## DublinHead54

Duke of Marmalade said:


> I am not going to apologise for giving a brief economics lesson.
> *Nobody *is recommending fiat as a good long term sov.  One of the great advantages in breaking from the gold standard is precisely that it does not have a long term sov.  When linked to gold there was always the risk that folk would HODL money which can be counter to its effectiveness as a medium of exchange.
> The safest form of *fiat based* sov are deposits.  The current interest rate in El Sal is 3.8% so $ deposits are gaining value.  (Possibly poor folk do not have access to this interest rate but that is the fault of the El Sal government/financial system).
> Here in Ireland state savings provide inflation beating returns which would satisfy the needs of the majority of folk.



Hey dukey but as the crypto maximalists will say in a rebuke....

HAVE FUN STAYING POOR


I've been having a back and forth with Wolfetone and I've come to the conclusion you can't use logic on this forum. It has already been decided that Bitcoin is the solution to every economic problem the big bad government has gotten us into. It is truely baffling some of the contradictory statements used. 

Markets can stay irrational longer than I can remain solvent, and this thread can remain irrational longer than I can stay patient. So I will ride off into the sunset with my BTC, waiting for this adoption to happen and the price to rise so I can dump at the expense of the El Salvadorians who were duped into investing their life savings.


----------



## WolfeTone

Dublinbay12 said:


> I do want to clarify that your statement on CB and governments are the only entities manipulating prices as being incorrect.



Please stop! Your habit of taking comments out of context and coming to conclusions that were never made is annoying now.
I never said they were the only entities, I said



WolfeTone said:


> So vast, and wielding is the international global financial system, only entities such as CB and governments _*have the wherewithal to manipulate the prices as they are being manipulated.*_



Do you know of other entities that are pumping trillions into the financial system right now? Do you know of other entities that have this capability?
Your Libor reference? So what? That was a corrupt practice was it not? Manipulation may not always be the result of corrupt practises. They can be perfectly legal, above board and in the open. When a government puts a freeze on rental prices, that is market manipulation. 
Central Bank cuts interest rates, more market manipulation. 
Is there any entities that you are aware of that can manipulate money markets to the extent that they are currently being manipulated by CB's and governments?


----------



## WolfeTone

Dublinbay12 said:


> So I will ride off into the sunset



Bye.


----------



## DublinHead54

WolfeTone said:


> Please stop! Your habit of taking comments out of context and coming to conclusions that were never made is annoying now.
> I never said they were the only entities, I said
> 
> 
> 
> Do you know of other entities that are pumping trillions into the financial system right now? Do you know of other entities that have this capability?
> Your Libor reference? So what? That was a corrupt practice was it not? Manipulation may not always be the result of corrupt practises. They can be perfectly legal, above board and in the open. When a government puts a freeze on rental prices, that is market manipulation.
> Central Bank cuts interest rates, more market manipulation.
> Is there any entities that you are aware of that can manipulate money markets to the extent that they are currently being manipulated by CB's and governments?


Wolfetone, you need to make your points clearer, this "thats not what I meant" rebuke to challenge is getting old. You've now asked a stupid question because what you are defining as market manipulation is actually known as monetary policy. Monetary policy can only be enacted by central banks, so to answer your silly question no the only entities that can use monetary policy are central banks. 

I'm not sure how any logical individual can deny that market manipulation can be performed outside of Central Banks. You are basically then saying there is no need for any type of regulation. Even the definition of market manipulation, proves you are wrong.


----------



## DublinHead54

WolfeTone said:


> Bye.



Thanks Wolfetone.


----------



## WolfeTone

Dublinbay12 said:


> Even the definition of market manipulation,



Ok, I will concede that in common parlance the word "manipulation" refers to malpractice and unfair interference.

Nevertheless, you may have noted at some point that a central tenet in my participation in bitcoin is on the basis that I consider much of monetary policy being applied is not based on sound economic thinking but rather as consequence to cover over widespread malpractice in the financial sector (Libor scandal being a part of it) , leading to unfair (albeit sometimes well-intended) interference by CB's. Let's not go down the rabbit-hole of why I should think that, it is my opinion based on a lot of observations. I'm happy to concede my understandings are not always correct, but by and large, the reason to hold bitcoin has been proven to be correct.


----------



## DublinHead54

WolfeTone said:


> I'm happy to concede my understandings are not always correct, but by and large, the reason to hold bitcoin has been proven to be correct.



What is that reason?


----------



## WolfeTone

Dublinbay12 said:


> What is that reason



I hold bitcoin, it has cost me nothing and is now worth a considerable sum.


----------



## DublinHead54

WolfeTone said:


> I hold bitcoin, it has cost me nothing and is now worth a considerable sum.



Your reason to hold Bitcoin is that it has made you money?

I thought you were a believer in the economic freedom of the big bad central banks. 

I would bet 10 BTC that if you didn't have skin in the game you'd be able to see the holes in your arguments. 

I feel sorry for anybody reading this thread and buying BTC at $60k, $50k, $40k or whatever price.


----------



## Duke of Marmalade

tecate said:


> Ok, and so where do most people park their savings? Yes, they can buy equities but if we're talking about ordinary people that aren't so savvy, their savings end up in deposit accounts.





WolfeTone said:


> What would you recommend poor people to do?


Obviously I have to draw diagrams.  Absolutely they can invest in deposits or in our case state savings, as I said.  The following are the long term returns on deposits (here referred to as cash).


			
				Damodaran said:
			
		

> And the annual returns from 1928 to 2020:
> Stocks +9.8%
> Bonds +4.9%
> Cash +3.3%
> 
> Damodaran also includes the inflation rate in his data which allows you to view real returns. In these 93 years the annual inflation rate was 3%, meaning the real returns were as follows:
> Stocks +6.8%
> Bonds +1.9%
> *Cash +0.3%*


I have highlighted the key figure.  A "real" return of 0.3% p.a. on cash.  Both the inflation and the interest rate on deposits are effectively managed by the Central Bank.  It's quite clever really.  M1 is what we call fiat and is the medium of exchange and it is reckoned by the experts that the optimum target for M1 is that it loses value at 2% p.a.  M1 is for buying things.  Under the gold standard M1 could increase in value versus other goods and services if gold was doing so.  That completely complicated its main role as a medium of exchange.
M3 are deposits or their equivalent (e.g. state savings).  This allows ordinary folk to have a store of value which is both secure and broadly matches inflation.
Please do not tell me the experience of Lebanon destroys these self evident truths about the system that I live in.  Likewise the dysfunctional financial landscape in El Sal is not relevant to my situation.


----------



## WolfeTone

Dublinbay12 said:


> Your reason to hold Bitcoin is that it has made you money?



No, wrong again. I was interested in the concept of being able to avail of and take custody of private money.
That it has paid off in terms of increased value is my good fortune.



Dublinbay12 said:


> I thought you were a believer in the economic freedom of the big bad central banks.



I am a believer in economic freedom. But this nonsense of the "big bad central banks" is _your_ interpretation of what _you_ think I am a believer in or not.
The irony is the cultists are the sycophants who dribble at the alter of all that central banks do and say.
I am a believer in economic freedom but that freedom is conditioned on a rules based system that one and all can operate off. Instead rules are changed to sustain and perpetuate bad monetary policy - that is what I oppose, am wary of. The consequences of which is the totally nonsensical unprecedented monetary policy in place now that is nothing to do with economic freedom but rather to sustain a centralised command banking economy.
Anyone who thinks the euro can survive as a stable currency without constant CB emergency intervention is truly the indoctrinated.



Dublinbay12 said:


> I would bet 10 BTC that if you didn't have skin in the game you'd be able to see the holes in your arguements



You are talking to someone who derided bitcoin from the first moment I heard about it. The 'holes', I assume you mean - Ponzi, criminals, energy usage, BOHA, China Crackdown, G7 crackdown, have all fallen by the wayside. Maybe you are talking about some other holes?



Dublinbay12 said:


> I feel sorry for anybody reading this thread and buying BTC at $60k, $50k, $40k or whatever price.



Why?


----------



## WolfeTone

@Duke of Marmalade you are taking the p now. You mean to say poor people need never have been poor if, through the generations, they had just routinely saved in a post office account? 
Give me a break. You know only too well when economic and/or fiscal policy goes sour it is broadly those who are on the lowest rung of the economic ladder that get squeezed most of what they hold.


----------



## DublinHead54

WolfeTone said:


> No, wrong again. I was interested in the concept of being able to avail of and take custody of private money.
> That it has paid off in terms of increased value is my good fortune.



A good fortune in terms of Fiat you mean?


----------



## Duke of Marmalade

WolfeTone said:


> @Duke of Marmalade you are taking the p now. You mean to say poor people need never have been poor if, through the generations, they had just routinely saved in a post office account?
> Give me a break. You know only too well when economic and/or fiscal policy goes sour it is broadly those who are on the lowest rung of the economic ladder that get squeezed most of what they hold.


That was out of left field  Now bitcoin is the salvation of the world's poor - cult indeed.  I was explaining  fiat monetary economics that's all.
I guess it hurt my exposing your crude denial that you advised the poor of El Sal to have a punt on bitcoin since they have nothing to lose.  (the poor will remain poor with virtue signalling champions like your good self)
@Dublinbay12 has the right idea.  I leave this thread which I started 6 months and 54 pages ago.  It may continue as a cultists' echo chamber though maybe some moderator will put it out of its misery.  Bye.


----------



## DublinHead54

WolfeTone said:


> I hold bitcoin, it has cost me nothing and is now worth a considerable sum.



@Duke of Marmalade this quote from Wolfetone sums this thread up perfectly.


----------



## Duke of Marmalade

Dublinbay12 said:


> @Duke of Marmalade this quote from Wolfetone sums this thread up perfectly.


I am sure he will donate his profits to the poor of the world.


----------



## WolfeTone

Duke of Marmalade said:


> I am sure he will donate his profits to the poor of the world.



Kind of. I invested most of it in eco-friendly projects in South Africa. Bringing cheap electricity via solar to businesses, schools, community projects. 
I get a return of course, here is the kicker - I get paid in bitcoin!


----------



## WolfeTone

@Dublinbay12 I think what sums up this thread, and many of the other FUD threads, is @Duke of Marmalade plea to close it. 

Just to recall, the thread opened on 30.12.2020 with bitcoin "hyperbolic bubble" at around $28,000. 

If it is closed now, and despite the recent crash, it will close some 25% higher than the price at the OP.


----------



## tecate

WolfeTone said:


> I hold bitcoin, it has cost me nothing and is now worth a considerable sum.


Well I never. This is the alternative investments sub-forum where the topic at hand is bitcoin and its suitability or otherwise as an investment - and you have the nerve to present here having already taken a position in btc? That's just plain wrong Wolfie. I mean, how could we possibly discuss the actual topic now knowing that? You clearly have the advantage and we won't be able to debate you on the actual topic. When that falls apart, best to stand and point and mumble 'self interest' instead.

I've just discovered the very same issue with this grandmother. She owns 5 BTC - and clearly with that skin in the game (It probably doesn't represent 1% of her net worth but lets not dwell on that) she's leading people astray. Have a gander at what she's suggesting people do.


__ https://twitter.com/i/web/status/1409945835908079618
Outrageous advice from the Senator (and former Wyoming *State Treasurer*) who sits on the Banking Committee.



WolfeTone said:


> No, wrong again. I was interested in the concept of being able to avail of and take custody of private money.
> That it has paid off in terms of increased value is my good fortune.


Well done on availing of the opportunity to choose - and having that conviction. Some wouldn't back their conviction with the price of a pint.



			
				 WolfeTone said:
			
		

> You are talking to someone who derided bitcoin from the first moment I heard about it. The 'holes', I assume you mean - Ponzi, criminals, energy usage, BOHA, China Crackdown, G7 crackdown, have all fallen by the wayside. Maybe you are talking about some other holes?



I fear you're right - there were other holes implicated with considerable self reflection and navel gazing for the individual concerned - relative to said hole.



WolfeTone said:


> Kind of. I invested most of it in eco-friendly projects in South Africa. Bringing cheap electricity via solar to businesses, schools, community projects.
> I get a return of course, here is the kicker - I get paid in bitcoin!


That sounds progressive Wolfie  (albeit wildly inconvenient as an answer!).


----------



## DublinHead54

tecate said:


> Well I never. This is the alternative investments sub-forum where the topic at hand is bitcoin and its suitability or otherwise as an investment - and you have the nerve to present here having already taken a position in btc? That's just plain wrong Wolfie.



If you want to talk about it as an investment today, the fact Wolfie says he got it for free is an entirely relevant point as there is bias. Wolfie himself over the last few days has said the price will go down if adoption increases and voiced he isn't sure whether adoption will happen (see quotes below). What is surprising, is that after all his due diligence and discounting of potential issues with BTC (Ponzi, criminals, energy usage, BOHA, China Crackdown, G7 crackdown), he still has doubts about BTC.

Based on the below quotes, I don't see how @WolfeTone can still maintain that for a new market participant, investing in BTC today is a good idea. He/she has doubts about its adoption and thinks the price is going to decrease. So in my opinion, they have zero credibility in advocating for BTC to be invested in today.

I'm glad you are now slowly admitting that BTC is an alternative investment rather than a currency, I just hope you can come to see how dangerous it is for countries like EL Salvador to use as a means of legal tender when others are using it to earn a return.

*I know you won't reply, its clear to all the readers here that you pick and choose arguments you can win and don't want to engage in any substantial debate. *

On adoption (only a 10x increase from today)...


WolfeTone said:


> I'm not sure, it may never happen...I am just open to the possibility that it could occur.



On the issue of Large holders


WolfeTone said:


> It may limit its potential adoption but bitcoin, as you know, is divisible to 100million satoshi's. So there is potential for everyone on the planet - with a smartphone and internet connection - to acquire some.
> I don't think we are anywhere near that occuring yet.



On price movement and adoption. He thinks over time the price is going to go down if Bitcoin is to be a success.


WolfeTone said:


> You get what you pay for. In my opinion, *bitcoin will not survive long term without a significant increase in participation* from the global population, driving up the price.
> A* significant increase in participation* by the global population will occur when large holders of bitcoin dilute some of their holdings (over time) *driving down the price.*
> It's a slow-burner, this has a long way to go.




Lastly,

My view, BTC as an alternative investment should be part of everyone's portfolio, but it should be a small part. The potential returns are diminished today from a year ago and will continue to diminish as price increases. By that I mean to get a 4x return today you need the price of a BTC to go to ~$140k, a year ago you needed it to go from $10k to $40k. For those of us lucky enough to have had skin in the game from the early days BTC has been an amazing investment offering 1,000+x returns. However, it remains a speculative investment, and no matter how many articles and videos @tecate posts and @WolfeTone cheerleading, it will remain a volatile risky asset for the significant future.


----------



## WolfeTone

@Dublinbay12 Your propensity to take views and opinions that are clearly conditional and suppostional and anoint them as some declarations of fact is tiresome.

In short, I have no idea what the future holds, what bitcoin price will be in a year, 10years etc. I can only make my own assumptions that it will grow, the scope for wider adoption is massive, that on turn may or may not increase its price - in my view it will.

You clearly see little upside to bitcoin price going above previous ATH, as you have openly expressed your sorrow for those who bought in higher than today's price.



Dublinbay12 said:


> I feel sorry for anybody reading this thread and buying BTC at $60k, $50k, $40k or whatever price


Yet you advocate that bitcoin should be part of everyone's portfolio. 



Dublinbay12 said:


> BTC as an alternative investment should be part of everyone's portfolio,



How do you square this circle? Advocating for bitcoin to be part of everyones portfolio while simultaneously feeling sorry for anyone who buys bitcoin "at any price"?


----------



## DublinHead54

WolfeTone said:


> @Dublinbay12 Your propensity to take views and opinions that are clearly conditional and suppostional and anoint them as some declarations of fact is tiresome.


Woflie, can you explain this? I quoted you directly to support the point that you have no idea how the price will go, and based on that you aren't qualified to be advocating for investment in BTC today. You have even agreed with it in your latest response by saying "I have no idea what the future holds, what bitcoin price will be in a year, 10 years etc".  So can you please explain how I have taken your opinion wrongly? If it is wrong, please enlighten me with your price prediction.

Unless you are saying that your entire opinion in this thread is based on conditionality? This totally erodes the integrity of your argument as it brings doubt to the forefront. I have seen this in the language you use over the last few days and when challenged you seem to think a suitable retort is that 'I didn't mean it that way'.

Regarding my other statements, it is rich you accuse me of misquoting and then do the very same thing. Those comments were in the context of people basing investment decisions on your advice of "I got it for free and it has earnt me money". When quite evidently you repeatedly state you have no idea of what the price will go like. In addition you chastised me for not quoting the full sentence and you go ahead and do the same thing and add in your own version! Laughable!

As you pointed out Bitcoin is divisible into Satoshis and it is your opinion that ownership of a satoshi has value at any point? I was hoping given that I said it should be a small part of a portfolio that was clear enough. How would you like me to explain portfolio theory for you?


----------



## DublinHead54

WolfeTone said:


> @Dublinbay12 Your propensity to take views and opinions that are clearly conditional and suppostional and anoint them as some declarations of fact is tiresome.



Another great summary of this thread......

We are unable to debate and challenge opinions because opinions are based on conditions....

*"Bitcoin price may at  go up, but I couldn't possibly tell you when or by how much I just know it will and that's my opinion"

"Bitcoin may be adopted at some point in the future"

"It's only starting now, just wait for the future"*


I think I've been trolled by Wolfie very successfully. I'm going to create a new thread where we can actually discuss neutrally BTC as an investment opportunity today. I will perhaps extend it to Defi and other initiatives.


----------



## WolfeTone

Dublinbay12 said:


> So can you please explain how I have taken your opinion wrongly?



My opinion is that I believe bitcoin price will rise in the future, given the potential adoption/participation/acceptance of the broader global population relative to the amount of people who have adopted/participate/accept bitcoin today. 
I'm open to possibility,  that I may be wrong but I would advocate for anyone and everyone, like your yourself, to hold some bitcoin in their portfolio. Given its volatility, only small amounts. 

Unlike yourself however I don't feel sorry for anyone who buys bitcoin "at any price". 
Can you square that circle please?


----------



## WolfeTone

Dublinbay12 said:


> I'm going to create a new thread where we can actually discuss neutrally BTC as an investment opportunity today.



Great, you can tell us all how much bitcoin will be in six months, a year, 5yrs and 10yrs from now?


----------



## WolfeTone

Dublinbay12 said:


> Those comments were in the context of people basing investment decisions on your advice of "I got it for free and it has earnt me money".



Except of course that is not what I said. 



Dublinbay12 said:


> When quite evidently you repeatedly state you have no idea of what the price will go like.



Neither do you. No more than any of us know what the price of oil will be in six months, 1yr, 5yrs etc.. 

We can make assumptions, we can make models or predictions, but none of us know for certain. 
All we can do is determine for ourselves if we consider something has the potential, or not, to grow in value. 
I certainly think bitcoin has massive upside potential. That is not to say I know for certain it will ever exploit that upside potential. I'm willing to risk a little in order to get a reward.


----------



## tecate

WolfeTone said:


> @Dublinbay12 Your propensity to take views and opinions that are clearly conditional and suppostional and anoint them as some declarations of fact is tiresome.





WolfeTone said:


> Except of course that is not what I said.



You're far too generous Wolfie. It's happened too many times to be anything other than a premeditated effort to misrepresent - sometimes to support a certain world view - and other times to try to goad someone into responding. Between this and moves to censor free discussion (if you don't agree with someone, all you have to say is "i disagree" and that's it. Trying to censor speaks volumes) - I've taken a different tack. This board has a wonderful 'ignore user' function. I've been using it in this specific case since January - and it works a tonic.
I've been made aware of attempts to draw me into conflict (not discussion) through posting untruths re. my views on this subject area (akin to what you refer to above). Someone can provoke all day long (and we'll have that after this post too - but I couldn't care less - not that those postings are visible to me) - bottom line for me is that when someone seeks to prevent free speech and goes on as per the above, there's no longer a discussion being had.


----------



## DublinHead54

WolfeTone said:


> Unlike yourself however I don't feel sorry for anyone who buys bitcoin "at any price".
> Can you square that circle please?



To clarify, I did not say I felt sorry for anyone who bought Bitcoin at any price, can you please set that record straight? 

My comment was intended in context of the discussion, on why you believed Bitcoin to be a good investment. Your response was that you got Bitcoin for free. 

So to be very specific on what was meant, I feel sorry for people who bought BTC at current high prices ($30k to $60k) observed over the last few months based on the advocation for Bitcoin that you and others have posted on this forum. I hope this clears the matter up for you sufficiently? 

You have a habit of agreeing with my points after I have made them, so I am glad you agree with my opinion that BTC should form part of an individuals portfolio. What you didn't notice or chose to miss is that I made no comment on what the entry point is or how people should get that exposure.


----------



## DublinHead54

WolfeTone said:


> Great, you can tell us all how much bitcoin will be in six months, a year, 5yrs and 10yrs from now?



Woah....Is that really your level of understanding? Just woah.  

Maybe I'll just take a leaf out of your book "Prices will go up but if they don't go up they will go down, don't ask me how, but they will go up. Don't ask me when this will happen, but it will happen at some point in the future, but if it doesn't it thats ok." 

That should cover me for all future debate.


----------



## DublinHead54

This shows the level of maturity on this forum. Tecate could not entertain any legitimate criticism of Bitcoin by a fellow Bitcoin community member. So he resorted to personal attacks to try and discredit when the allegations were shown to be factually inaccurate. He chose to continue with the attacks and his thread got closed by the admins. He must still harbour some ill feelings given how easy it is for him to dig up old threads. 

Feel free to chose to ignore, but that just further highlights the unwillingness to entertain a fruitful discussion on the topic of Bitcoin.

Even when I suggest a new topic @WolfeTone begins mocking and @tecate continues his attacks.

I am at a fundamental loss of how anyone interested in Bitcoin and been around the technology long enough can be so dictatorial in their views. In this forum from the start Tecate and now Wolfetone bucket people who criticise as naysayers spreading FUD.

In 55 pages, there is very very little information of use to anyone trying to understand this technology.


----------



## DublinHead54

Uh Oh....


----------



## WolfeTone

Dublinbay12 said:


> To clarify, I did not say I felt sorry for anyone who bought Bitcoin at any price, can you please set that record straight?



Sure no problem, here is what you actually said lest anyone think I was trying deliberately to distort your comments



Dublinbay12 said:


> I feel sorry for anybody reading this thread and buying BTC at $60k, $50k, $40k or whatever price






Dublinbay12 said:


> My comment was intended in context of the discussion, on why you believed Bitcoin to be a good investment. Your response was that you got Bitcoin for free.



That was not my response. I did not get bitcoin for free. Can you please set that record straight? 
My bitcoin holding $ cost average is zero. Its monetary value is not insignifcant. 



Dublinbay12 said:


> So to be very specific on what was meant, I feel sorry for people who bought BTC at current high prices ($30k to $60k) observed over the last few months based on the advocation for Bitcoin that you and others have posted on this forum.



Ok, so clearly you do not advocate acquiring bitcoin above $30k. 



Dublinbay12 said:


> What you didn't notice or chose to miss is that I made no comment on what the entry point is or how people should get that exposure.



Yes, I think you were going to open another thread and enlighten us all to your investment advice to bitcoin?


----------



## DublinHead54

WolfeTone said:


> Sure no problem, here is what you actually said lest anyone think I was trying deliberately to distort your comments



You got me. In hindsight I should not have said 'whatever' price, it was not correct in the context of my response. I apologize.


You said "it has cost me nothing", I assumed you meant that you had mined Bitcoin, there is no record to set straight. You have had to put $ into an exchange to purchase BTC, no? Those BTC are now worth more than you paid for, and you cashed out your initial stake? 

You surely can see how your first quote is misleading? You felt the need to provide the secondary clarity that you have achieved $0 cost average. 



WolfeTone said:


> I hold bitcoin, it has cost me nothing and is now worth a considerable sum.





WolfeTone said:


> That was not my response. I did not get bitcoin for free. Can you please set that record straight?
> My bitcoin holding $ cost average is zero. Its monetary value is not insignifcant.


----------



## DublinHead54

WolfeTone said:


> Yes, I think you were going to open another thread and enlighten us all to your investment advice to bitcoin?



I am working on it, but I am not giving advice, just presenting information for those to make their own decisions. It is pretty hard to determine a stance from reading this thread.

You yourself who has been one of the fiercest proponents for BTC admitted you don't know what will happen to the price or if adoption will happen.

Maybe you'll read it, maybe you'll learn something, but do participate and provide topic suggestions.


----------



## WolfeTone

@Dublinbay12 I appreciate your efforts on your new thread to introduce a neutral discussion on btc as an investment option.
I am however somewhat reluctant to accept your invite to critique and provide feedback on that that thread given its  neutral stance. Instead I will offer some feedback here in case such feedback descend into a blood and guts affair - nobody will notice any difference in these pages and your new thread shall remain pristine.

Personally speaking, it comes across like a ground zero moment. A "_let's start all over again with the condition that I will dictate the terms of the discussion and should I perceive that anyone has stepped out of those terms then I can call them out as being wrong" _moment_. _

Now I accept my perception may be off the mark, or not agreeable with you, but it is my critique and my feedback as you requested.

As far as investing/speculating etc in bitcoin I will offer you a brief summary of my affairs with bitcoin over the last couple of years, all of which is recorded somewhere in the pages of AAM.

I first bought btc at around $2500 in 2017 purely as a speculative punt. Its price went to $20k. It crashed, and as it did so I bailed out 80% of my holding at around $10k price mark.
I subsequently started to buy btc again at around $3,500 (having given it more consideration other than a speculative asset). Further to that, as part of the taunting rituals in these discussions, I challenged anyone to short bitcoin at around the $10k mark last year, its price subsequently going 'hyperbolic'.
My own modeling for bitcoin price reckoned, last November, that



WolfeTone said:


> I value it at $34,500 per coin



when it's market price was roughly half that.
You may want to take a look out your window today and check what price it is today?

Of course I am no seer nor proclaim to be, just a small time independent investor who determines his own decisions on his own modeling. For example, I didn't forsee the Musk intervention and the subsequent drive to $60K. The price being way over what my own prediction was I tended to agree that it had overshot itself and I duly cash in some more @ $54k.
The price as you can see has reverted back to around my previously stated position of around $34k.

Now I appreciate you are willing to disperse some nuggets of wisdom that helps with investment decisions and perhaps you may enlighten me to where it is that I am going wrong?


----------



## DublinHead54

@WolfeTone, You've got your perception wrong. Given that I clearly state it is a 'neutral' stance, there will be no calling people out. You should note I already told one of the harshest critics from this forum to not mention Roubini. The objective is to keep updating the main post as feedback comes in from those like yourself so that it can benefit all users of this forum. We can keep the debate and discussion on topics like this. I've already received a number of positive PMs that the information is helpful.

Do you have any specific feedback or suggestion on the content? I think you could provide some great content given your assertations above. 

It sounds like you have a good method of valuing Bitcoin, can you provide your approach for valuation and I will include it? Did you refine your approach from your earlier predictions?


WolfeTone said:


> 31.12.19 $16,000








The challenge I have had for the last 8 years and in particularly since 'crypto twitter' and FUD from late 2016, is that you can't statistically model the impact of a tweet. It is very popular especially on Crypto Twitter to use technical analysis as an indication of a breakout or case for an investment, however it can't factor in the impact of news stories or government announcements.


----------



## tecate

WolfeTone said:


> I appreciate your efforts on your new thread to introduce a neutral discussion on btc as an investment option.


There is no such thing as a 'neutral' discussion. The moment someone forms an opinion, inherent bias exists. That's not to say that there isn't value in having a post that provides a view in summary - but it is someone's 'take' or a group of people's view on the subject. The same goes for commercial and social media. There is no media without bias on the very same basis.



WolfeTone said:


> Personally speaking, it comes across like a ground zero moment. A "_let's start all over again *with the condition that I will dictate the terms of the discussion and should I perceive that anyone has stepped out of those terms then I can call them out as being wrong*" _moment_. _


ALL . DAY . LONG .

Otherwise, in terms of reaching conclusions, each individual reaches their own conclusions on this subject. There is no one oracle. Additionally, the consideration of future developments is incredibly important. For anyone to suggest otherwise is wayward. Ask any macro investor just how important it is to continually contemplate how things are most likely to unfold. 

@WolfeTone - I'm going to tell you who you can and can't mention on here because I'm neutral but feel free to engage in open discussion. Lastly, well done on your ventures with the 'imaginary internet money'. At least yours is 'imaginary internet money' and not imaginary - imaginary internet money.


----------



## DublinHead54

Over the course of 3 years @tecate has pointed to the lightning network roughly 60 times as the solution to scaling issues. The mention of LN delivery is often to reject criticism tabled, and support the case for BTC. However, by Tecates own admission it is only as of June 2021 that the LN is beginning to "make some impact". In those three years we have seen BTC rise from $18,000 to $60,000 without Lightning Network. Thus, BTC price movements can and have moved independently to enhancements of the underlying network.  

In my investment analysis thread, I suggest that to make an investment decision on Bitcoin an investor does not to put much emphasis on future enhancements. What I mean and will clarify is that an investor should not base their decision on information / price predictions based on potential future enhancements of BTC that are guaranteed. 

This is evidenced below that the price movement of BTC over the last 3 years has been independent of the Lightning network as an example. 


Bitcoin Price




Feb 2018


tecate said:


> Lightning Network is on the way - and so, it's hoped that it will once again be a functional transactional currency.



Jun 2021


tecate said:


> Lightning Network is only just beginning to make some sort of impact (despite not being a completed project itself - its still being developed).


----------



## tecate

Dublinbay12 said:


> Over the course of 3 years @tecate has pointed to the lightning network roughly 60 times as the solution to scaling issues. The mention of LN delivery is often to reject criticism tabled, and support the case for BTC. However, by Tecates own admission it is only as of June 2021 that the LN is beginning to "make some impact".


Fact Check:  I referred to LN on an ongoing basis and over most of that time, I referred to it being in development. I didn't say that it _was _a solution to scaling - I referred to it repeatedly as having potential to resolve the issues of excessive transaction cost, excessive transaction time and restricted transaction through-put. Despite the potential that I believed it had/has, throughout those years, I acknowledged that bitcoin had limitations with regard to its use as a medium of exchange.
The  motivation of El Salvador - and its plans surrounding bitcoin  center entirely around the use of lightning network. It's still early days - LN is still in development  - and I expect that there are and there will be technological challenges and difficulties it has to overcome yet. However, the view I expressed early on - when nobody else ever mentioned LN or layer 2 solutions - has been vindicated. I'm not just talking about LN but the use of layer 2 solutions generally - across the sector.
On the other hand, we've had one of the 'approved media' that you direct people towards over and above all other sources - outline recently that the use of bitcoin as a medium of exchange is farcical because of scaling issues -  completely ignoring LN. We've had other naysayers do exactly the same here - including you. You're so diligent in pointing out my reference to the LN (even if there's literally nothing related to me and my input here you can possibly present in a factually correct manner ).  Lets talk of your own lack of knowledge on the subject. Had you spent two minutes investigating the El Salvador project you would have known that LN is central to it. You didn't because you had no clue.



Dublinbay12 said:


> In those three years we have seen BTC rise from $18,000 to $60,000 without Lightning Network. Thus, BTC price movements can and have moved independently to enhancements of the underlying network.


I was here during the depths of the 2018 bear market. There was practically no other folk positive about bitcoin/crypto knocking around back then ( there were a few that preceded me - but they'd long since been chased off ). I saw with my own two eyes what was happening in terms of real development in the space - and I posted on that basis. These are the posts that you claimed to be rhetoric when you dropped-by much, much later. They were real life examples of tangible development. Now they're coming so fast that its practically impossible to keep up with what's going on in the space. People that I pay heed to in this space - who I could only dream of having a fraction of their knowledge - have said themselves - pick certain projects and know them. Even they can't possibly keep on top of what's being developed.
The price during that bear market had no correlation to fundamentally sound developments that were going on back then - just like someone sneezing on twitter is over-exaggerated to the upside in this and previous bull markets. 
LN has taken an age to develop and it's far from finished (even though it is in effect a live and workable solution that is being used this very day). If you're saying that it's not 'priced-in', that may very well be. That in no way surprises me given its only starting to show its promise right now.



Dublinbay12 said:


> In my investment analysis thread, I suggest that to make an investment decision on Bitcoin an investor does not to put much emphasis on future enhancements. What I mean and will clarify is that an investor should not base their decision on information / price predictions based on potential future enhancements of BTC that are guaranteed.



You're free to use whatever parameters you want for your thread. I have no intention or desire to stand in your way. However, I do have an opinion and I'm free to express it should I choose to do so. Over the course of the 3-4 years that you referred to above, time and time again I listened to the argument that bitcoin doesn't do jack - it's been around for donkeys years - ergo...I'm calling it as bs and a waste of time. You and anyone else are entitled to take that view - entirely up to yourself. However, I believe it to be completely wayward with regard to the innovation that's in front of us. The point that you make with regard to LN completely underscores my own point. Development within the space as a whole - validates my view. Whilst you have repeatedly reminded us of your expertise in this area, I have repeatedly pointed out that I have none. However of the little that I do know, I respect people that do detailed analysis as macro investors. I respect their thesis - which is that anticipating how this is all going to unfold is incredibly powerful from an investment viewpoint should someone get it right.

Seeing as we're having a look at what I've posted going back years, another line item for you is that I have always maintained that every individual is responsible for their own choices and arriving at their own conclusions. That's first and foremost. Secondly, over the course of those years, anything I've posted here has been my opinion - and solely my opinion. It wasn't advice. In the few instances where we got close to that line, I repeatedly made the case for the existence of merit in taking a btc position of no more than a few percent of an overall portfolio. NO-ONE from the naysayer or (alleged) neutral side of the fence agreed with me on that point.


----------



## DublinHead54

tecate said:


> . Had you spent two minutes investigating the El Salvador project you would have known that LN is central to it. You didn't because you had no clue.



For somebody claiming to have no expertise, you've done a great job at fooling me! You know more than I do!

I'm not sure the relevance of El Salvador has to the comment I made. However, as we are on Hot on factchecks please see my reference from earlier this week regarding LNs importance in the success of the El Salv project.

I know it surprises you given you've classified me as a 'naysayer', but I'm involved in crypto. I read a wide range of content on crypto from various sources daily. Though as you've pointed out, I must be reading the wrong sources.



Dublinbay12 said:


> $30 is not great when fees can hit $60+. Given the average GDP of EL Salvador residents is $4,000 per annum, anything other than extremely cheap transactions is too expensive for them. For this to be any kind of success it requires the rollout of the lightning network.
> 
> Interestingly given that BTC fees can be bid up during periods of volatility to allow those who want to sell or buy get their transactions to the front of the line. This pits the relatively poor El Salvadorians against those with large holdings or deep pockets (Wall Street Institutional Investors).
> 
> View attachment 5666



So just to be clear, when you said the below. You didn't think that LN was the solution to scaling? I understand you caveated back then that it may not work but you were still clearly off the belief it would be the solution given the amount of times you mentioned it.  What's your stance now after 3 years? You seemed to be bullish the other day on LN. If not, what's the potential solution (layer 2 or otherwise)?

If LN doesn't work by your own admission (previous quote) BTC will struggle as a transactional currency? Thus that farcical article isn't really farcical?



tecate said:


> It had made modest in-roads in this regard...but the momentum has gone into reverse as bitcoin hit scaling issues (resulting in prohibitive tx fees and times).  If that gets resolved by Lightning Network, then it can move forward again in this respect.



What I've really struggled with Tecate is that you come out with, "I'm not an expert, this is just my opinion" but then you are so incredibly quick to discount experts who criticise Bitcoin. I would think if you've no expertise you'd be more open to listen to opinions.

For example I referenced 2 crypto news sources and the FT, and you've said they've no credibility. I apologize, I mean you didn't say it directly, you inferred it but kept it vague enough to claim you've been misquoted.


----------



## tecate

Dublinbay12 said:


> I'm not sure the relevance of El Salvador has to the comment I made. However, as we are on Hot on factchecks please see my reference from earlier this week regarding LNs importance in the success of the El Salv project.



The post where you bemoan the cost of main-net fees in the context of the Salvadoran project? On that basis, you suggest that bitcoin isn't an appropriate solution for your average Salvadoran - that it requires the roll-out of the lightning network. Salvadorans have been using LN for months already. Lightning Dev's went there and developed the Bitcoin Beach LN wallet app. Jack Mallers' Strike app is LN-based and its in use.



Dublinbay12 said:


> I know it surprises you given you've classified me as a 'naysayer', but I'm involved in crypto. I read a wide range of content on crypto from various sources daily. Though as you've pointed out, I must be reading the wrong sources.


Why would I be surprised - you've volunteered that info on a number of occasions. As regards reading the wrong sources, if you need book recommendations, there's a few that I think would be suitable for you - albeit that none of them are related in any way to crypto/blockchain.




Dublinbay12 said:


> If LN doesn't work by your own admission (previous quote) BTC will struggle as a transactional currency? Thus that farcical article isn't really farcical?


It's completely farcical. LN exists today - it can and is being used today for micropayments. The entire Salvadoran project is LN based. Mallers' strike app is LN based. Bottlepay is LN based. A number of exchanges have enabled LN. Now it could be reasonable if this appeared in the article somewhere - but it didn't even get a mention.




Dublinbay12 said:


> What I've really struggled with Tecate is that you come out with, "I'm not an expert, this is just my opinion" but then you are so incredibly quick to discount experts who criticise Bitcoin. I would think if you've no expertise you'd be more open to listen to opinions.


You have no basis for said comment (your 'example' doesn't qualify - I'll get to that in a second). It's very much in my interests to seek out criticism of BTC - and that's precisely what I do. My decision to participate here was made in that vein. It's understating things to say that this isn't a crypto-positive space.




Dublinbay12 said:


> For example I referenced 2 crypto news sources and the FT, and you've said they've no credibility. I apologize, I mean you didn't say it directly, you inferred it but kept it vague enough to claim you've been misquoted.



Firstly, you're making an assumption that someone writing for the FT is an expert. That's a mistake. They may or may not be. And even if they are - an  expert in what? Discussion of bitcoin implicates finance, tech, monetary policy, regulation, etc. etc. Ask the Duke what my go-to example of a renowned economist not staying in his lane (keynesian economics) and making big fat (wayward) claims on tech is.
Secondly, this is not the 1970s. Any professional worth their salt would not be insecure about having any idea challenged. In fact, they would actively encourage it. Last but not least, any opinion expressed comes with an inherent bias.
You work in some way with crypto. Then this should resonate with you. I can't remember if its the WSJ or the FT but one or other of them - when someone checked it, the word 'DeFi' had appeared in that publication less times than I have fingers. It's not something that's been discussed here at all but we're talking about something that's going to disrupt the hell out of traditional finance and that's how much attention they've been paying to it.



			
				Dublinbay12 said:
			
		

> Ask your friend _Tecate_, as he is often posting examples of market manipulation in support of BTC adoption.


You've made the big fat claim - now lets see what you'll concoct. I say concoct as there's no earthly way I've done such a thing. Lets here it.




			
				Dublinbay12 said:
			
		

> Ok so any reporting that dares criticise or present a negative opinion is FUD? What a load of rubbish. If that were true then it seems some people on here have authoritarian views when it comes to bitcoin. *It's such a weak defence to just call a news story FUD, especially when said reporting comes from respected crypto news outlets.*
> 
> I guess I should just come to this forum for the truth*.
> 
> 
> *Truth according to Tecate


And there's your error. If you can't think in first principles, then you're at a distinct disadvantage. See above on your 'respected news outlets'. Secondly, nobody has claimed anything to be FUD here without giving their complete rationale as to why.


----------



## DublinHead54

tecate said:


> The post where you bemoan the cost of main-net fees in the context of the Salvadoran project? On that basis, you suggest that bitcoin isn't an appropriate solution



Simple Question.....Can El Salvadors usage of Bitcoin as a legal tender work without Lightning Network?

My statement was that it will not be successful without the rollout of Lightning Network. As you should be aware the Lightning Network is still being rolled out and developed, correct me if this is incorrect. 




tecate said:


> Firstly, you're making an assumption that someone writing for the FT is an expert. That's a mistake. They may or may not be. And even if they are - an  expert in what? Discussion of bitcoin implicates finance, tech, monetary policy, regulation, etc. etc. Ask the Duke what my go-to example of a renowned economist not staying in his lane (keynesian economics) and making big fat (wayward) claims on tech is.
> Secondly, this is not the 1970s. *Any professional worth their salt would not be insecure about having any idea challenged.* In fact, they would actively encourage it. Last but not least, any opinion expressed comes with an inherent bias.
> You work in some way with crypto. Then this should resonate with you. I can't remember if its the WSJ or the FT but one or other of them - when someone checked it, the word 'DeFi' had appeared in that publication less times than I have fingers. It's not something that's been discussed here at all but we're talking about something that's going to disrupt the hell out of traditional finance and that's how much attention they've been paying to it.



Firstly, given you claim to have no expertise in the area but have formed an opinion. I assume you have used various news sources / crypto sources to form your opinion?

Secondly, I did not claim the FT to be an expert, but I do believe they have credibility. As you point discussion in Bitcoin requires knowledge or expertise in a wide range of topics, so unless you've found a news story for BTC with articles written by only an expert in finance, tech, monetary policy and regulation, you have also made choices on what news sources have credibility? It is pretty clear you stray on the side of mainstream media having no credibility in writing about BTC, why? Why can't a good journalist write about a topic they are not an expert in? I am pretty sure this happens everyday in journalism hence why journalist do research, seek out sources etc etc.

Lastly, this is where you are misguided "Any professional worth their salt would not be insecure about having any idea challenged". You have not challenged, you have simply inferred the FT is 'farcical'. You now introduce DeFi, good timing the FT just had an excellent article at the weekend regarding Regulators grappling with DeFi, so not really sure where you got that mainstream media aren't paying attention to DeFi, similarly the most recent development in El Salvador has been covered thoroughly in mainstream media.

Are you saying that I should ignore articles about crypto written in the Financial Times?


----------



## DublinHead54

I bid you all the best @tecate...Goodbye


----------



## DublinHead54

Dublinbay12 said:


> @WolfeTone, You've got your perception wrong. Given that I clearly state it is a 'neutral' stance, there will be no calling people out. You should note I already told one of the harshest critics from this forum to not mention Roubini. The objective is to keep updating the main post as feedback comes in from those like yourself so that it can benefit all users of this forum. We can keep the debate and discussion on topics like this. I've already received a number of positive PMs that the information is helpful.
> 
> Do you have any specific feedback or suggestion on the content? I think you could provide some great content given your assertations above.
> 
> It sounds like you have a good method of valuing Bitcoin, can you provide your approach for valuation and I will include it? Did you refine your approach from your earlier predictions?
> 
> View attachment 5676
> 
> 
> The challenge I have had for the last 8 years and in particularly since 'crypto twitter' and FUD from late 2016, is that you can't statistically model the impact of a tweet. It is very popular especially on Crypto Twitter to use technical analysis as an indication of a breakout or case for an investment, however it can't factor in the impact of news stories or government announcements.



I guess that valuation method needs some work.


----------



## WolfeTone

Dublinbay12 said:


> I guess that valuation method needs some work.



Eh, yes of course it does. While I can point to a series of successes in valuing bitcoin including a near bullseye price prediction of $34,500 I can also point to a series of price predictions that where I was way off the mark also. 
What I didn't include in my previous quote predicting $34,500 was the rest of the sentence which continued "its impossible to time the market". 
If someone thinks they have a fool-proof way of doing this then they are deluded. 

There is no fixed, set, mathematical equation that I apply to valuing bitcoin. I determine it from a number of observable and variable sources and then I make my own determination as whether or not to buy or sell. 
I'm of the view that bitcoin price has scope to go alot higher than previous ATH's albeit I do not think that is going to happen anytime in the short-term (1yr). 
I could of course be totally wrong in that, time will tell.


----------



## DublinHead54

WolfeTone said:


> Eh, yes of course it does. While I can point to a series of successes in valuing bitcoin including a near bullseye price prediction of $34,500 I can also point to a series of



Can you point to them? I don't see any evidence of you making a bullseye prediction, you guessed $34,500 without saying the time. In fact the only evidence I see of you predicting the value of Bitcoin with an associated time you got it wrong. 




WolfeTone said:


> I determine it from a number of observable and variable sources


Such as?


----------



## WolfeTone

Dublinbay12 said:


> In fact the only evidence I see of you predicting the value of Bitcoin with an associated time you got it wrong.



So why would you request that I post my valuation method?



Dublinbay12 said:


> can you provide your approach for valuation and I will include it?



If I am getting it wrong, can you point out to me where? I have asked you this already.

It is my understanding that timing the market is impossible, however, realizing profitable gains is generally considered to be getting things right.


----------



## DublinHead54

WolfeTone said:


> So why would you request that I post my valuation method?



Because you brought up the topic of having a modelling approach for making 'near bullseye' price predictions.  Why would I not request something that can make 'bullseye predictions'?! I requested your model before clarified that it doesn't time the market, it is not mathematical but based on observation. I don't think you have a modelling approach at all. 



WolfeTone said:


> My own modeling for bitcoin price reckoned, last November, that








WolfeTone said:


> If I am getting it wrong, can you point out to me where? I have asked you this already.



I have already posted this, but I will post it again. Your Prediction below, actual price ~$7,000


WolfeTone said:


> 31.12.19 $16,000




Can you provide what observable and variable sources you use to make bullseye predictions? Further, given you have the ability to make near bullseyes prediction, based on your opinion today, what is your price prediction for 6 months from now? Don't be shy, you were willing to make time stamp predictions previously.


----------



## WolfeTone

Dublinbay12 said:


> Because you brought up the topic of having a modelling approach for making 'near bullseye' price predictions.



Except I never did any such thing. This is another one of your distortions of the English language. Here is exactly what I said



WolfeTone said:


> While I can point to a series of successes in valuing bitcoin *including* a near bullseye price prediction of $34,500 I can *also point to a series of price predictions that where I was way off the mark also*



Any rational understanding of the English language would take from that, that as much as I claim to have got one near precise 'bullseye' price prediction, my modelling for price predicting has also been quite wrong on several occasions. As you mentioned,



Dublinbay12 said:


> I guess that valuation method needs some work.



 and to which I agreed.



WolfeTone said:


> Eh, yes of course it does



So rather than the impartial, neutral topic you claim to want to generate, you rather create the topic on your terms, your own interpretation and to jump on anything you think you can call out as being wrong. 



Dublinbay12 said:


> Can you provide what observable and variable sources you use?



I could, but I choose not to because there is a considerable amount of variable sources, always in a state of flux....upon which I make my own interpretation of the substance of the data and come to my own determination if something (anything) is undervalued or overvalued. 
But at a broad level I follow monetary policy decisions of ECB, Federal Reserve and other major Central Banks, I think this is pertinent to any investment decision about buying or selling bitcoin. I make my own critical interpretation of monetary policy and what impact I think it may have on the price of bitcoin. As mentioned earlier, I remain somewhat bearish over the short term (1yr at least) on bitcoin price, albeit over the long-term I am very bullish. 

Basically, I live and die on my own sword. I don't need help in making investment decisions in bitcoin, and I don't pretend to be offering help to others make investment decisions in bitcoin.


----------



## DublinHead54

Wolfetone, your approach of claiming I am misquoting is getting tiresome and tedious. See below were you say you first introduced that you used a model to predict a price of $34,500 that you then referenced as your own 'near bullseye' prediction. 



WolfeTone said:


> My own modeling for bitcoin price reckoned, last November, that




Honestly, I give up, it is impossible to have any logical discussion with you. 

I'm glad your _model_ has allowed you to be _somewhat bearish in the short term whilst also long term very bullish_. We all know you have no model, and you are just making an educated guess. Case in point, you weren't able to use your broad macroeconomic model across multiple variable sources that are in flux examing Central Bank Monetary policy to predict the rise to $60k. 

In fact you should know that monetary policy of the ECB and FRB has largely been unchanged for the last 10 years, and specifically the last 2 years during Covid. It is only in the last 2 weeks the FRB has made a major announcement around monetary policy, so I would have thought your _'model' _would have given you a new price prediction. 

I honestly can't believe you are claiming a 'bullseye prediction'

I bid you well Wolfetone. 

Goodbye


----------



## WolfeTone

Dublinbay12 said:


> We all know you have no model, and you are just making an educated guess



I prefer to call to it "an informed estimate", sounds more pro, like you!

I work off the maxim that all models are wrong, some are useful. My model (sorry, educated guess/informed estimates) in at first speculating, then learning, then investing, then profiting in bitcoin has been useful to me.



Dublinbay12 said:


> In fact you should know that monetary policy of the ECB and FRB has largely been unchanged for the last 10 years



That is your interpretation of policy decisions made by ECB and Fed Res, and that is why your claims to be interested in



Dublinbay12 said:


> simply providing information to help others form an opinion



is pure codology.

If you think monetary policy has been largely unchanged then here is brief history of Fed Reserve QE monetary policy changes since 2008.


_- In late November 2008, the Federal Reserve started buying $600 billion in mortgage-backed securities.

- In November 2010, the Fed announced a second round of quantitative easing, buying $600 billion of Treasury securities by the end of the second quarter of 2011

- A third round of quantitative easing, "QE3", was announced on 13 September 2012.

- On 19 June 2013, Ben Bernanke announced a "tapering" of some of the Fed's QE policies contingent upon continued positive economic data. Specifically, he said that the Fed could scale back its bond purchases from $85 billion to $65 billion a month during the upcoming September 2013 policy meeting. He also suggested that the bond-buying program could wrap up by mid-2014.

- On 18 September 2013, the Fed decided to hold off on scaling back its bond-buying program and announced in December 2013 that it would begin to taper its purchases in January 2014.

- Purchases were halted on 29 October 2014 after accumulating $4.5 trillion in assets.

- In September 2019, the Federal Reserve began conducting its fourth quantitative easing operation since the 2008 financial crisis_

Now perhaps you read that as a continuation of the same policy throughout, with some tinkering? Good luck with that.
In my view, the repeated additional announcements of extending QE amount to a change of the policy direction that was intended at outset of the previous announcement.
That is my interpretation, which clearly will differ from yours. As such we are likely to take different courses of action in investment strategy.




Dublinbay12 said:


> I feel sorry for people who bought BTC at current high prices ($30k to $60k)



Why would you feel sorry for people who bought BTC at current high prices? Perhaps you can reveal your own 'model' that invokes this concern from you?


----------



## DublinHead54

WolfeTone said:


> If you think monetary policy has been largely unchanged then here is brief history of Fed Reserve QE monetary policy changes since 2008.
> 
> 
> _- In late November 2008, the Federal Reserve started buying $600 billion in mortgage-backed securities.
> 
> - In November 2010, the Fed announced a second round of quantitative easing, buying $600 billion of Treasury securities by the end of the second quarter of 2011
> 
> - A third round of quantitative easing, "QE3", was announced on 13 September 2012.
> 
> - On 19 June 2013, Ben Bernanke announced a "tapering" of some of the Fed's QE policies contingent upon continued positive economic data. Specifically, he said that the Fed could scale back its bond purchases from $85 billion to $65 billion a month during the upcoming September 2013 policy meeting. He also suggested that the bond-buying program could wrap up by mid-2014.
> 
> - On 18 September 2013, the Fed decided to hold off on scaling back its bond-buying program and announced in December 2013 that it would begin to taper its purchases in January 2014.
> 
> - Purchases were halted on 29 October 2014 after accumulating $4.5 trillion in assets.
> 
> - In September 2019, the Federal Reserve began conducting its fourth quantitative easing operation since the 2008 financial crisis_
> 
> Now perhaps you read that as a continuation of the same policy throughout, with some tinkering? Good luck with that.
> In my view, the repeated additional announcements of extending QE amount to a change of the policy direction that was intended at outset of the previous announcement.
> That is my interpretation, which clearly will differ from yours. As such we are likely to take different courses of action in investment strategy.



Wolfetone, what are you talking about?!?! Do you know what monetary policy tools are? How can a continuation of Quantitative easing be interpreted as a change of policy direction?????????? You continually contradict yourself in your own sentences responses. 

But I will entertain your train your interpretation for a second. Can you explain how these 'changes of policy direction' have impacted the price of Bitcoin over the last 10 years?

 P.s you also misquoted me, are you now doing that on purpose? To reiterate I said that Monetary Policy has been unchanged for the last 10 years.

I note you chose to ignore my question around the latest development from the FRB, if you watch what they do so closely. Why can't you comment on an announcement of policy change from a few weeks ago?


You win, I can't handle your illogical reasoning any longer.


----------



## DublinHead54

WolfeTone said:


> Why would you feel sorry for people who bought BTC at current high prices? Perhaps you can reveal your own 'model' that invokes this concern from you?



Because your bullseye model values BTC currently at $34k with a somewhat bearish view in the shortterm. Thus people buying at higher prices based on advise in this forum, are losing money. They should have all listened to your model.

P.s, if you haven't named your model yet maybe you can name it Bullseye


----------



## DazedInPontoon

My two cents: the short term price might be influenced by a Musk tweet, or even more likely a tweet might be the catalyst for a movement that was on the cards anyway, but the long term average price is a function of long term demand.

If you think the long term demand of bitcoin will increase at a rate higher than the supply increases then it is logical to also think that the long term average price will increase.


----------



## WolfeTone

Dublinbay12 said:


> How can a continuation of Quantitative easing be interpreted as a change of policy direction??????????



Can I give you a Ladybird analogy? 

In June 2013 I announced to my family that we were going to Wexford for the Summer and we would be returning in September. We packed our stuff and off we went. When we got to Wexford we thought it was so nice that on the 18th September 2013 I announced that we were going to stay until December. 
We changed policy, it meant we had to buy some additional supplies which cost us money. Had we known we were going to stay for an extended period we would have brought additional supplies with us that would have saved us a bit of money.


----------



## WolfeTone

Dublinbay12 said:


> Can you explain how these 'changes of policy direction' have impacted the price of Bitcoin over the last 10 years?



My reasoning to you is illogical. You would not be able to handle it. All you need to know is that it has been profitable.


----------



## DublinHead54

WolfeTone said:


> My reasoning to you is illogical. You would not be able to handle it. All you need to know is that it has been profitable.



I was referring to your illogical reasoning in how you present your arguments with the constant contradictions with earlier stated beliefs. Post number #1121 is another example of such. 

It is great that your 'model' allows you to profit from Bitcoin.


----------



## WolfeTone

Dublinbay12 said:


> I note you chose to ignore my question around the latest development from the FRB, if you watch what they do so closely. Why can't you comment on an announcement of policy change from a few weeks ago?



Because you didn't ask a question, you made a statement 



Dublinbay12 said:


> It is only in the last 2 weeks the FRB has made a major announcement around monetary policy, so I would have thought your _'model' _would have given you a new price prediction.



I assume you are referring to Paycheck Protection Program Liquidity Facility?


----------



## DublinHead54

WolfeTone said:


> Can I give you a Ladybird analogy?
> 
> In June 2013 I announced to my family that we were going to Wexford for the Summer and we would be returning in September. We packed our stuff and off we went. When we got to Wexford we thought it was so nice that on the 18th September 2013 I announced that we were going to stay until December.
> We changed policy, it meant we had to buy some additional supplies which cost us money. Had we known we were going to stay for an extended period we would have brought additional supplies with us that would have saved us a bit of money.



Wolfetone, I like the analogy but its wrong, which brings into question your understanding of what the FRB have said and your model. I guess you started investing in Bitcoin around 2014 so probably weren't looking at what the FRB said before that point. 

To my understanding and evidenced by comments by Bernanke, the FRB never committed to an end date, they did say that as the economy rebounded they would relax their aggressive use of monetary tools as a response to the financial crisis. So to use your analogy, the FRB never said they were returning from Wexford in September. What they actually said was "We are going to Wexford until September, and if we like it we will stay longer until we need to come back". I'll add some context, I worked in the US for an investment bank post 08 on regulatory projects, and it that line of work the policy of CBs was always clear. 

Now, I am not commenting on whether the FRB and other CBs policy actions are right or wrong. What I am arguing is that your view of additional QE representing 'policy change' is incorrect. 

What actually begs the question is you seem to indicate that if an entity does evolve in response to a developing world and economy that this is a negative? So I assume that you then do not agree with Bitcoin enhancements and developments that change it from the original whitepaper?


----------



## DublinHead54

WolfeTone said:


> I assume you are referring to Paycheck Protection Program Liquidity Facility?



err no.......I am referring to one of the most important pieces of information in the global financial system......the FRB talk about quarterly, people trade on it, it impacts millions of people directly, and trillions of dollars of investment products, it is an actual signal of monetary policy change. 

That should be enough clues.


----------



## DublinHead54

WolfeTone said:


> Because you didn't ask a question, you made a statement



You got me on a technicality, choose to hide behind that if you want.


----------



## Firefly

DazedInPontoon said:


> If you think the long term demand of bitcoin will increase at a rate higher than the supply increases then it is logical to also think that the long term average price will increase.


And that's a fundamental reason why I think Bitcoin is unsuited as a medium of exchange. The supply of Bitcoin is fixed. Scarcity will encourage hoarding which is a characteristic a currency should _not _have. Hoarding will lead to an implosion of economic activity - people will stop spending as they will think the purchasing power of their money will be higher tomorrow. I'm no economist but I fail to see a problem with QE if the rate of inflation is kept in check. Sure a dollar today buys a lot less than a dollar 50 years ago. But so what? People have plenty more dollars in their pockets today. And anyway.....hasn't population risen by billions since then...sure don't we need to print more money anyway....


----------



## Firefly

WolfeTone said:


> Can I give you a Ladybird analogy?
> 
> In June 2013 I announced to my family that we were going to Wexford for the Summer and we would be returning in September. We packed our stuff and off we went. When we got to Wexford we thought it was so nice that on the 18th September 2013 I announced that we were going to stay until December.
> We changed policy, it meant we had to buy some additional supplies which cost us money. Had we known we were going to stay for an extended period we would have brought additional supplies with us that would have saved us a bit of money.


You should have went to Cork, you'd never have left


----------



## WolfeTone

Dublinbay12 said:


> to your illogical reasoning



as opposed to your own illogical reasoning? Perhaps it is dawning on you that if you are considering offering help to others to make informed investment decisions in bitcoin that perhaps you should put up first with some sound logical reasoning to do so. Instead your strategy seems to have been to take a punt on any bit of crypto going and to see which way the wind blows.
Now that is all well and good if that is what you want to do, but stop the pretence that you are here to inform.

Its funny how when I make a price prediction in 2019 that is wrong you are quick to highlight it. But I made the $34,500 prediction in Nov 2020 when bitcoin was $17,000. Less than two months later it had reach the $34,500 (which if not mistaken was a new all-time high at the time). The underlying point was that I very bullish about bitcoin. Was the price prediction lucky? For sure it was but the underlying point was that I very bullish about bitcoin and I was correct.



Dublinbay12 said:


> I like the analogy but its *wrong*



There's a shocker! 



Dublinbay12 said:


> What they actually said was "We are going to Wexford until September, and if we like it we will stay longer until we need to come back".



So what did they do, did they pack enough supplies until they need to come back when they run out of supplies, or did they pack enough until September and make another decision later. Either way, one decision may end up costing more money that the other decision. What would you do?



Dublinbay12 said:


> I am referring to one of the most important pieces of information in the global financial system



Well, according to you, it's one of the '_most important pieces of information in the global financial system_'. Personally, I only think it is important if the substance of it makes sense (to me!).
So if you are referring to the FOMC statement of 16 June 2016

FOMC Statement 2021

Then I can positively say to you that I think it is one of the greatest examples of worthless information polluting cyberspace. It is completely contrived by a bunch of egotistical wanna-be seers that think they can control the inflation rate. For sure, they can make decisions that will impact the inflation rate but they cannot control it.
How do I know this? Because they say it themselves in their statement.

_"The Committee seeks to achieve maximum employment and inflation at the rate of 2 percent over the longer run. *With inflation having run persistently below this longer-run goal*, the Committee *will aim to achieve inflation moderately above 2 percent for some time so that inflation averages 2 percent over time and longer‑term inflation expectations remain well anchored at 2 percent*. The Committee expects to maintain an accommodative stance of monetary policy until these outcomes are achieved. The Committee decided to keep the target range for the federal funds rate at 0 to 1/4 percent and expects it will be appropriate to maintain this target range until labor market conditions have reached levels consistent with the Committee's assessments of maximum employment and inflation has risen to 2 percent and is on track to moderately exceed 2 percent for some time."  _

Think about it, if they could control the inflation rate then why was inflation *running persistently* below the longer-run goal of 2%? If they can control the inflation rate then why was it not running persistently at the longer-run target of 2%?

Worse, they aim to achieve "inflation *moderately* *above 2 % for some time *so that inflation averages 2 percent over time and longer‑term inflation expectations remain well anchored at 2 percent"

What does that even mean? 3% for 24 months, or 4% for 12 months, or 6% for 6months? Do you know? Can you explain it?

These people are charlatans. If you want to fall at the alter of this CB spoofery go for it.


----------



## letitroll

tecate said:


> I so hope you're right because I want to buy some more.


Oh yeah - what’s your fair value range for BTC…..the price under which your a happy accumulator? Genuinely interested.

I’m going to assume you didn’t jump in and buy more at $40k, $50k, $60k……you seem to think $19k is a good deal…..is $25k a good deal then?….you buying right now?

So what’s @tecate BTC valuation range?


----------



## tecate

It's a discussion that's been had here extensively last year. There is no neat formula for btc valuation - in the same way as there isn't for gold, silver, etc. All I can tell you is that I've tended to buy when most people weren't interested and not buy when most people were.


----------



## letitroll

tecate said:


> It's a discussion that's been had here extensively last year. There is no neat formula for btc valuation - in the same way as there isn't for gold, silver, etc. All I can tell you is that I've tended to buy when most people weren't interested and not buy when most people were.


@tecate - your all sizzle and no steak…..you dance around for 58 pages of this thread……but get all frigid & mysterious when your asked for a a broad price range for beloved Bitcoin.

Im not asking for an exact price to the decimal place…….give me a range…..you’ve already given me one range let’s call it ~$19k seen as you seemed so happy about my next check in when BTC hits that….so let’s stop your nonsense, coyness and show us your cards, face up. Pin your colors to the mast or you know get off the stage. The real story is you’ve no idea and your afraid to write it down.


----------



## tecate

letitroll said:


> @tecate - your all sizzle and no steak ..you dance around for 58 pages of this thread……but get all frigid & mysterious when your asked for a a broad price range for beloved Bitcoin.


I 'dance around 58 pages of this thread'? Are you off your meds? So someone presents with a contrarian view to your own and this is how you choose to respond? 



letitroll said:


> Im not asking for an exact price to the decimal place…….give me a range…..you’ve already given me one range let’s call it ~$19k seen as you seemed so happy about my next check in when BTC hits that….so let’s stop your nonsense, coyness and show us your cards, face up. Pin your colors to the mast or you know get off the stage. The real story is you’ve no idea and your afraid to write it down.


Let me cut right to what the 'real story' is. I obliged you with an answer - which is my genuine belief. ...ergo there is no neat and tidy formula. The discussion has been had many times where people taking your position hold bitcoin to a higher standard than items like gold and silver. 
Now, if you're going to try and force the issue, then let me short circuit matters. Inform the discussion what the fair value of gold is today. Your refusal to do so yet go on about bitcoin valuation means that you're not approaching this discussion with a modicum of objectivity.


----------



## letitroll

Wow such a simple question gets such a reaction from you when we are literally talking about a very instrument who’s function is as a store of value…….I mean the most IMPORTANT maybe the ONLY thing that matters here is what is it worth in your opinion?!?!? You have to realize how absurd your being dancing around the question like an amateur politician.

You’d swear I’d asked what color are the eyes of god - blue or green?!? Your own estimated fair value should not be unknown to you, especially as you’ve spouted about it for the last god knows how many pages. Then go MIA when someone asks you to make a call on your view of its price.

On golds value I’ve no issue at all with your question. Why would I.

My valuation framework for gold is as a pretty but scarce metal that’s consumed in the production of jewelry and other ostentatious displays of wealth. I expect it will always have this function and so will always be in demand as the globe grows wealthier and more populous.  

So based on the above I would happily buy gold all day long as a prudent investment at 5% below the current extraction/replacement cost…..measured by the the lowest cost per Oz scale global gold producer/miner…..currently that’s Polysus from Russia which has an AISC (all in sustaining cost ) of $640 / oz of gold produced.

I’m a happy buyer/investor in gold therefore at ~$610/oz. or below.

On BTC I’ll give you my valuation it’s $0.01……cause there’s enough dummies in the world to buy the dip all the way down to almost zero but then sit around thinking BTC will bounce back one day. Think of me then as a happy buyer/investor in Bitcoin at $0.01 and a seller at $0.02.

Now spit out YOUR estimation of BTC’s current price where your a happy buyer/investor  @tecate ? The absurdness of you dancing around this question can’t be lost on you or others reading this thread as I’ve said the very instrument itself we’re talking about is a supposed store of wealth and medium of exchange so what’s the trigger point where your loading up the truck?


----------



## ArthurMcB

Steady on letitroll


----------



## WolfeTone

letitroll said:


> I’m a happy buyer/investor in gold therefore at ~$610/oz. or below



There is some merit to your valuation but its pretty limited in terms of strategy. By the sounds of it you are trying to minimise risk (no bad thing) to point of perhaps never taking any risk (useless) 
When was the last time gold was at $610? 10yrs ago? In the meantime you have completely missed some massive upside and I suspect you may be waiting a long, long time before you see $610 again, if ever.


----------



## ArthurMcB

letitroll said:


> Please don’t make monkey out of yourself



Steady on Letitroll. Aside from the ongoing debate. Youre getting fairly agressive imo


----------



## letitroll

Micro-aggressions removed - reposting below & edited above....still waiting on a answer to a simple question from @tecate ?

Wow such a simple question gets such a reaction from you when we are literally talking about a very instrument who’s function is as a store of value…….I mean the most IMPORTANT maybe the ONLY thing that matters here is what is it worth in your opinion?!?!? You have to realize how absurd your being dancing around the question like an amateur politician.

You’d swear I’d asked what color are the eyes of god - blue or green?!? Your own estimated fair value should not be unknown to you, especially as you’ve spouted about it for the last god knows how many pages. Then go MIA when someone asks you to make a call on your view of its price.

On golds value I’ve no issue at all with your question. Why would I.

My valuation framework for gold is as a pretty but scarce metal that’s consumed in the production of jewelry and other ostentatious displays of wealth. I expect it will always have this function and so will always be in demand as the globe grows wealthier and more populous.

So based on the above I would happily buy gold all day long as a prudent investment at 5% below the current extraction/replacement cost…..measured by the the lowest cost per Oz scale global gold producer/miner…..currently that’s Polysus from Russia which has an AISC (all in sustaining cost ) of $640 / oz of gold produced.

I’m a happy buyer/investor in gold therefore at ~$610/oz. or below.

On BTC I’ll give you my valuation it’s $0.01……cause there’s enough dummies in the world to buy the dip all the way down to almost zero but then sit around thinking BTC will bounce back one day. Think of me then as a happy buyer/investor in Bitcoin at $0.01 and a seller at $0.02.

Now spit out YOUR estimation of BTC’s current price where your a happy buyer/investor @tecate ? The absurdness of you dancing around this question can’t be lost on you or others reading this thread as I’ve said the very instrument itself we’re talking about is a supposed store of wealth and medium of exchange so what’s the trigger point where your loading up the truck?


----------



## tecate

letitroll said:


> Wow such a simple question gets such a reaction from you when we are literally talking about a very instrument who’s function is as a store of value…….I mean the most IMPORTANT maybe the ONLY thing that matters here is what is it worth in your opinion?!?!? You have to realize how absurd your being dancing around the question like an amateur politician.


I'll tell you what's absurd - the embittered position you've taken on the subject such that you can't acknowledge the answer that I gave you.




letitroll said:


> You’d swear I’d asked what color are the eyes of god - blue or green?!? Your own estimated fair value should not be unknown to you, especially as you’ve spouted about it for the last god knows how many pages. Then go MIA when someone asks you to make a call on your view of its price.


You're owed diddly squat from me - that's first and foremost. Secondly, re. your disdain for my views on bitcoin  - duly noted. I mean that brings a hell of a lot of merit to what you're going on with here, right? As regards your 'demand', I have no notion of making specific calls when this relatively new asset is coming of age  within the first new asset class since the 17th century. There are a whole host of regulatory, macro-economic and other factors that could have a major impact on btc price in the shorter run. What I can tell you is that if I didn't have any open position in bitcoin today, I'd be a buyer today  - simple as that. Other than that, I'm quite happy to dollar cost average my way into a broader position should price continue to consolidate from here.



letitroll said:


> On BTC I’ll give you my valuation it’s $0.01……cause there’s enough dummies in the world to buy the dip all the way down to almost zero but then sit around thinking BTC will bounce back one day. Think of me then as a happy buyer/investor in Bitcoin at $0.01 and a seller at $0.02.


Yeah, I mean I have the humility to acknowledge that bitcoin could indeed fail but what with all the horrid plebs in the world, that eventuality is looking increasingly unlikely - but never say never, right? We live in ( hope, right)?



letitroll said:


> Please don’t make monkey out of yourself by dodging the question again. It’s like, embarrassing  at this point.


Well I'd really hate to 'make monkey' out of myself - that would be horrendous. The embarrassment I'd feel among the 'bitcoin must DiE community' - I mean, that would be tough right?


----------



## tecate

WolfeTone said:


> There is some merit to your valuation but its pretty limited in terms of strategy. By the sounds of it you are trying to minimise risk (no bad thing) to point of perhaps never taking any risk (useless)
> When was the last time gold was at $610? 10yrs ago? In the meantime you have completely missed some massive upside and I suspect you may be waiting a long, long time before you see $610 again, if ever.


That's why I didn't even bother addressing it. It's a complete cop-out. The other irony is that whilst the greatest aspect gold has going for it as a store of value is its long history, its more recent history demonstrates a whole decade where it was equally as volatile as bitcoin (or more recently still when between 2011 & 2015 it fell from $1875 to $1000)...yet ridicule is to be reserved exclusively for bitcoin as a store of value apparently.


----------



## letitroll

Thanks. Still vague but let me help summarize the above - in the absence of your current BTC holdings, you would be a potential buyer at todays prices (~$29,000) and below. 

I appreciate you giving us the broad postal code for your personal valuation framework for BTC.

Like seriously what was so hard about throwing that out there on an anonymous forum on the internet. Very strange.


----------



## noproblem

letitroll said:


> Oh yeah - what’s your fair value range for BTC…..the price under which your a happy accumulator? Genuinely interested.
> 
> I’m going to assume you didn’t jump in and buy more at $40k, $50k, $60k……you seem to think $19k is a good deal…..is $25k a good deal then?….you buying right now?
> 
> So what’s @tecate BTC valuation range?


Might be €1, might be €500,000. In the same way experts say it has no value, others seem to believe otherwise.


----------



## DazedInPontoon

letitroll said:


> Now spit out YOUR estimation of BTC’s current price where your a happy buyer/investor @tecate ?


I can chime in too. As I've said before peaks and troughs are just volatility, the long term average is the closest thing I can use to determine some kind of fair value based on a point in the adoption curve.

Given that, the Mayer multiple is probably as good a rough guide as any https://stats.buybitcoinworldwide.com/mayermultiple/ and it's pretty low right now, indicating that now is a pretty good time to buy. Like tecate I would buy some if I didn't already feel I had enough of an allocation, I'll probably buy regardless if it does get back near 20k.


----------



## letitroll

https://stats.buybitcoinworldwide.com/mayermultiple/

Interesting model, I'm sure it helps many sleep well at night.........I'm sure it also SELLS *a lot* of bitcoin to people.......the link itself is hilarious *BUY*bitcoinworld........its marketing nothing more & nothing less........the bitcoin equivalent of 2 minute Abs.......for those who put any stock in it as a robust statistical valuation framework........well what I can say nothing in this world is more deluded than the belief that differential calculus & econometrics can be applied to the emotional oscillations of homo sapiens buying and sale a thing between each other with no intrinsic value other than a vague belief somebody will buy it later on for the same price or more


----------



## DazedInPontoon

letitroll said:


> .the link itself is hilarious *BUY*bitcoinworld........its marketing nothing more & nothing less........the bitcoin equivalent of 2 minute Abs


totally agree, it's just the first one I found with a chart of the mayer multiple


----------



## WolfeTone

letitroll said:


> with no intrinsic value other than a vague belief somebody will buy it later on for the same price or more



Ah, not the old intrinsic value argument again?



letitroll said:


> My valuation framework for gold is as a pretty but scarce metal that’s consumed in the production of jewelry and other ostentatious displays of wealth. I expect it will always have this function and so will always be in demand as the globe grows wealthier and more populous.
> 
> So based on the above I would happily buy gold all day long as a prudent investment at 5% below the current extraction/replacement cost…..measured by the the lowest cost per Oz scale global gold producer/miner…..currently that’s Polysus from Russia which has an AISC (all in sustaining cost ) of $640 / oz of gold produced.
> 
> I’m a happy buyer/investor in gold therefore at ~$610/oz. or below.



In short, a vague belief that someone will buy gold later at $610 or more.


----------



## letitroll

WolfeTone said:


> In short, a vague belief that someone will buy gold later at $610 or more.



Vague - get your dictionary out @WolfeTone 

Let's be clear. I'm no investor or lover of gold. Lots other more sensible things to do with my assets. I was asked to estimate the price at which I would consider Gold as an investment. My thesis is that its been prized for at least 5,000 years by humans as a thing of value. Not a terrible supposition that that might continue for the next 50 years of my life given the track record? This then somewhat answers the question of whether demand for Gold is likely to exist in the future. Not guaranteed but 5,000 years is a long time and 50 years is short by comparison.

I then asked myself in a world where the probability of demand remaining robust is high over my investment horizon what is the incremental production cost for an oz of Gold. The lowest cost miner, Polysus, can produce gold at an all in cost of ~$640/oz.....for a reasonable IRR I'd want a discount to that price......5% seemed reasonable - ~$610 gets me to that price.

No vague beliefs @WolfeTone in my $610 assessment of where I'd even consider hitting buy with Gold. Nothing certain either - just a reasoned and probabilistic assessment based on multi-millennium historical demand for Gold extrapolated out to the future with the contemporaneous replacement cost discounted by 5% to allow for return. Vague isnt the word I'd use for what i just laid out. If thats the case I'd like to see your VAGUE btc value thesis?


----------



## DublinHead54

letitroll said:


> Vague - get your dictionary out @WolfeTone
> 
> Let's be clear. I'm no investor or lover of gold. Lots other more sensible things to do with my assets. I was asked to estimate the price at which I would consider Gold as an investment. My thesis is that its been prized for at least 5,000 years by humans as a thing of value. Not a terrible supposition that that might continue for the next 50 years of my life given the track record? This then somewhat answers the question of whether demand for Gold is likely to exist in the future. Not guaranteed but 5,000 years is a long time and 50 years is short by comparison.
> 
> I then asked myself in a world where the probability of demand remaining robust is high over my investment horizon what is the incremental production cost for an oz of Gold. The lowest cost miner, Polysus, can produce gold at an all in cost of ~$640/oz.....for a reasonable IRR I'd want a discount to that price......5% seemed reasonable - ~$610 gets me to that price.
> 
> No vague beliefs @WolfeTone in my $610 assessment of where I'd even consider hitting buy with Gold. Nothing certain either - just a reasoned and probabilistic assessment based on multi-millennium historical demand for Gold extrapolated out to the future with the contemporaneous replacement cost discounted by 5% to allow for return. Vague isnt the word I'd use for what i just laid out. If thats the case I'd like to see your VAGUE btc value thesis?


Ahh @letitroll don't you know that Wolfetone has a model they've developed using various inputs that correctly valued and predicted the Bitcoin price at $34k a few weeks ago.


----------



## WolfeTone

letitroll said:


> Vague



Ok, I'll let you have that one. But the premise is still the same. You will buy at $610 on the belief that you will be able to sell it later at that price or higher. 
It's randomonics, as mentioned before next to zero strategy. 

@Dublinbay12 has finished his daily prayers at the alter of high priest Central Bankers. You still following their ten commandments? 

Your premise for feeling 'sorry' for anyone buying bitcoin over $30,000 was on a ludicrous assumption that I was offering investment advice on bitcoin. 
Had anyone taken my posts as advice they would have bought bitcoin at $3,500, bought some more at $10,000, bought some more at $17,000 and offloaded all, or some, at $54,000...before it crashed back to my predicted valuation of $34,500.
At which point I mentioned I'm somewhat bearish in the short-term... (that's 3 months in my model). What's it price today? Up or down from $34,500.
As things stand, looking to the alter you worship I can only envisage so more sudden drops, but if it goes below $27,000 within 3months then, as @letitroll might say, I will 'load up the truck'. 

If however the facts change, as they do, then my forecast will change. 

Whats not to like about my model for forecasting bitcoin price?


----------



## letitroll

WolfeTone said:


> It's randomonics, as mentioned before next to zero strategy.


Respectfully disagree - my gold valuation is probabilistically sound and likely to return, if it were ever to drop to $610, a very respectable return in a wide range of scenarios…..not much more you can ask, nothing is 100% certain in forecasting. I even retain a very small probability in my mind that BTC will one day exceed $64k again but I put in the earth shattering comet collision category. Possible but highly highly unlikely.



WolfeTone said:


> When was the last time gold was at $610? 10yrs ago? In the meantime you have completely missed some massive upside and I suspect you may be waiting a long, long time before you see $610 again, if ever.


You seemed to wholeheartedly agree with me a few posts ago on gold PT - and actually poo poo’d it as too low.

In regards to missing massive upside in Gold - so what, I miss a lot of upside in a lot of things. I‘m not required to have an opinion or strategy on gold and only provided one for the purposes of this discussion but also to highlight that both you & @tecate  were unable or unwilling to provide anything close to the logical & reasoned thesis I built for Gold AND I dont even care about gold! You guys sure seem to care alot about bitcoin, so I would have expected something more robust back but the lack thereof confirms my thesis on bitcoin, so thank you both & see you at $19k when I shall come to haunt you both again. 

Stay well, stay lucky……and always buy dip….eventually you’ll dollar cost average down to ZERO and you literally cant lose then. Its a winning formula.


----------



## tecate

letitroll said:


> my gold valuation is probabilistically sound and likely to return, if it were ever to drop to $610, a very respectable return in a wide range of scenarios…..not much more you can ask, nothing is 100% certain in forecasting.


As Wolfie pointed out to you from the get go, your 'valuation' is about as useful as an ashtray on a motorcycle...although you get points for actually having a go. Pricing models are wrong more often than not  - albeit occassionally useful. That's as far as it goes.



letitroll said:


> I even retain a very small probability in my mind that BTC will one day exceed $64k again but I put in the earth shattering comet collision category. Possible but highly highly unlikely.


There's probably a support group for the long list of naysayers here who said that $20k would never be topped again. I'd advise sending out a few DMs as your assumptions could very well be well and truly punished in this regard.




letitroll said:


> I‘m not required to have an opinion or strategy on gold and only provided one for the purposes of this discussion but also to highlight that both you & @tecate  were unable or unwilling to provide anything close to the logical & reasoned thesis I built for Gold AND I dont even care about gold!



This discussion played out a long time ago in these parts and nothing has changed. You contrive to deliberately miss the point. The point is that you have no notion what the price of gold should be right now. Using production cost is at least some sort of answer - but what utility does that measure have then if theres no reasonable expectation of gold trading at or below production cost in the short or medium term? Secondly, I've no doubt that production cost informs decision making in the $10 trillion gold space - but clearly its not being utilised as the sole determinant re. price.  It's current market price speaks to that.

That's what you provided. Now to the ongoing and wayward criticism of bitcoin pricing. I'm not going to apologise for there not being a nice neat little formula to determine price (just like there isn't with gold - and as above, production cost calcs don't cut the mustard - sorry). If you were genuine in your approach to this discussion, you'd simply acknowledge that. It's even possible to do that and still respectfully maintain the opinion that you see bitcoin as pointless, etc etc. What comes through is pure salt and bile (because there's nothing pragmatic about your view here - you're ideologically opposed to bitcoin).



letitroll said:


> so thank you both & see you at $19k when I shall come to haunt you both again.


See my last sentence above - and now read yours. You won't be 'haunting' me with anything - you don't have that power my embittered friend. There are a myriad of exogenous factors that can send btc price up/down/sideways over the course of the short/medium/long term. I respect that - clearly you don't. 



letitroll said:


> Stay well, stay lucky……and always buy dip….eventually you’ll dollar cost average down to ZERO and you literally cant lose then. Its a winning formula.


Very classy indeed.


----------



## tecate

DazedInPontoon said:


> totally agree, it's just the first one I found with a chart of the mayer multiple



I suspect you didn't push matters any further as you've far more respect for your own time than I do when it comes to mine. However, its the height of bad faith argument to attack the domain name that Trace Mayer uploaded his Mayer Multiple calc to rather than to be pragmatic and examine and challenge the actual calculation. Further bad faith argument on display when the old trusty 'meh no intrinsic value' card is played.


----------



## WolfeTone

letitroll said:


> my gold valuation is probabilistically sound and likely to return



Yes, I agree. But if we are talking about investing then you need to consider a timeframe otherwise what you are saying is as about as significant as saying your house will be valued at $0 one day. It will, but when? 100yrs, 200yrs, 500yrs?
Without a timeframe, then you are simply avoiding the risk of ever being wrong, in which case it is not strategic investment you are talking about, rather a prediction on par with say - one day war will break out somewhere in Europe.




letitroll said:


> small probability in my mind that BTC will one day exceed $64k again but I put in the earth shattering comet collision category.



This is just the opposite side of coin that you accuse bitcoiners being unable or unwilling to do. You have admitted that there is a 'small probability', so spit out your formula for that to occur!



letitroll said:


> were unable or unwilling to provide anything close to the logical & reasoned thesis I built for Gold



I will give you a small insight into my thinking. I do not proclaim to speak for anyone else but I would imagine there is some common thinking.
I do happen to think bitcoin, in the digital age that we are living in, is a new asset class. It is property rights. It is a medium of exchange (poor), it is a store of value. It is a viable alternative option to store private wealth outside of the centralised command banking system.

Now you can disagree, and that is your perogative. Maybe I am crazy?

But how much is it worth? How do I value it?
I happen to think that bitcoin, given my views on what it is, has potential to reach as many people than say, Facebook, Amazon or Apple or Google. In fact I would say probably all those put together and more.

I also happen to think central bank credibility is slowly being shot to pieces. The pure drivel coming out of the hierarchy is pathetic. To put it another way, when was the last time a CB forecast was right?
They are on perpetual money printing - 10yrs later after the initial round of QE - it's a farce. And some people around here fall at alter of their monthly statements.

I am bearish, short term for bitcoin, namely because of mining disruption and yes there is going to be some political pushback. But in my view, from what I've heard, most of this pushback is 99% bluster and waffle and FUD regurgitated by one cycle of idiots after another clueless to what they are talking about.

I look to the future, I think bitcoin will be here in 10yrs time at least (save a superior tech being invented to replace it). In 10yrs time the people running the country and the world will be more exposed to bitcoin, and 10yrs after that too.

Buy bitcoin at any price. But in my opinion over next few months the price is not going anywhere significant.



letitroll said:


> eventually you’ll dollar cost average down to ZERO and you literally cant lose then.



Too late, already past that point.


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