The Bitcoin threads could be interesting in the future

[WolfeTone]

I was pointing to the mixed messages on value here.

Me too.

Some of the crypto faithful are keen to dismiss gold's utility in electronics, industry and jewelry as irrelevant in determining its value,

That's not how I read it. Rather dismiss golds utility what I understand is that we are trying to understand how gold, with its limited industrial use, is valued at €1,500 per ounce? There is little rationale for it if focusing solely on its industrial use.

but you suggested that because something constitutes a thread means it has value.

It doesnt mean it has value, it can mean it has value. I will make an assumption that we all agree that nuclear annihilation serves no value to the human race?
However, it is arguable, that the threat of nuclear annihilation does have value as it compels adversaries to resolve their differences by other means, typically diplomatically. This has obvious value for the human race.

My question is, given that the thrust of these bitcoin debates have centered on whether bitcoin has value or not (as aside from putting a price on any such value), why would governments ban, or try to ban, bitcoin? If it has no value, such as a BOHA, then why try ban it?

A threat to the prevailing monetary system has been alluded to in this discourse as perhaps a basis for wanting to ban bitcoin. If this is the case, then it is clear to me that bitcoin must have intrinsic value.

 

[Leo]

There is little rationale for it if focusing solely on its industrial use.

You too are falling into the trap of ignoring the ~50% of demand from the jewellery industry?

If it has no value, such as a BOHA, then why try ban it?

Speeding has no value, but we ban that. You conflating the tangible with the intangible.

 

[tecate]

Only if they can buy a satellite modem, and satellite internet still has to route through ground stations and on through backbones that are state run. People get around the great firewall only to the extent that the authorities allow. Authorised VPN use is permitted, but you need to ask what do companies have to do to achieve authorisation?

For what you set out, you'd need the cooperation of every government on the planet without exception. I think that's highly unlikely. Bitcoin transactions are already possible over satellite - i'm not talking about satellite internet so that we're clear.
Other than that, does internet filtering work where tor is concerned?

See, still ignoring the largest class of use. Kinda proves my point.

I'm doing no such thing. I'm completely in acceptance of the use of gold for jewelry. What I've pointed out to you is that the World Gold Council states that the motivation behind gold jewelry use is as a store of value. People want to use it as a store of value as much as they want to display their wealth.

The last time you said that you refused to post a link confirming that view. Can you now?

Trying to twist things again Leo. I pointed out to you that in that debate that was had originally - a link was provided. If you are of a mind to read it, then run a search for world gold council and report - it will come right up.

With respect, I don't think you fully follow JK's argument. He argues that store of value can only piggyback off some utility value - it cannot stand alone.

Ok, and in that instance, Duke - how do you square that against yours(?) and Nouriels contention that bitcoin is a store or value (or partial store of value - albeit i'm waiting on someone to clarify the distinction ...I suspect there isn't any)?

 

[Leo]

Trying to twist things again Leo. I pointed out to you that in that debate that was had originally - a link was provided.

Rather than get lost in the myriad threads you spin, why don't you just provide that link again? I searched, I couldn't find it.

 

[WolfeTone]

You too are falling into the trap of ignoring the ~50% of demand from the jewellery industry?

I don't think so. The price of gold has fluctuated anywhere between €250 an ounce to €1750 an ounce over the last 20yrs. Is the demand for jewellery over the last 20yrs that much a factor on this price fluctuation? I would not have thought so, but I may be wrong.

Speeding has no value, but we ban that. You conflating the tangible with the intangible.

Speeding of course, has value. Is there no value between transporting goods by horse and cart and instead more quickly by mechanical vehicles?

There comes a point, specific to speeding on our roadways where the value of that speed is lost to other factors other than just economic. Societal values such as our health and safety. We value our health and safety over speed, so we try to find a balance between the two by imposing speed restrictions. As well as a societal advantage it also an economic advantage in reducing accidents and associated healthcare costs, insurance premiums, and overall well being of society. Excessive speed, while of value to some (not wanting to be late for work for example), is a threat to that overall well being. That is why we impose penalties for breaking speed limits.

Anyway, back to the banning of bitcoin. I can not see any conceivable reason why governments, in open and free societies would even consider banning bitcoin unless it is a fundamental threat, perceived or real, of some kind overall to the institutions of the State and the fabric of society and economy at large.
Personally, I do not think it is a threat, but rather it is a benefit to society and the economy at large. Only those who feel threatened by it will want to ban it.

 

[tecate]

I searched, I couldn't find it.

Astonishing. Here you go, Leo.

 

[tecate]

I don't think so. The price of gold has fluctuated anywhere between €250 an ounce to €1750 an ounce over the last 20yrs. Is the demand for jewellery over the last 20yrs that much a factor on this price fluctuation? I would not have thought so, but I may be wrong.

You're not wrong Wolfie!

 

[Duke of Marmalade]

Anyway, back to the banning of bitcoin. I can not see any conceivable reason why governments, in open and free societies would even consider banning bitcoin unless it is a fundamental threat, perceived or real, of some kind overall to the institutions of the State and the fabric of society and economy at large.
Personally, I do not think it is a threat, but rather it is a benefit to society and the economy at large. Only those who feel threatened by it will want to ban it.

I agree that it is very difficult to see bitcoin reaching a position where it serious unsettles monetary policy. But Lyn Alden does include it in her 7 points.
The current price of bitcoin can only be sustained long term if it achieves a commensurate utility value as a moe (John Kelleher). If it did achieve that utility value as an moe it would indeed be a significant factor in the monetary landscape, perhaps enough to lead to significant official curtailment. Lyn sees that danger but minimises it by reflecting that adoption my the likes of Microstrategy makes that less likely. I would not be so sanguine if I were her.

 

[tecate]

I agree that it is very difficult to see bitcoin reaching a position where it serious unsettles monetary policy. But Lyn Alden does include it in her 7 points.

Can't you see that as being a force for good? If bitcoin use goes to those levels then that will only come about because some central bank (or banks) have been negligent. If the knowledge of bitcoin and its usability improves, governments and central banks will be given a further incentive not to steal or screw up. I can't imagine how anyone could see that as being anything less than a force for good. Where has competition/more options ever been a bad thing?

The current price of bitcoin can only be sustained long term if it achieves a commensurate utility value as a moe (John Kelleher).

And every time you try and drown the discussion out with this, I'm forced to refute it. We can go the long way round with this or the more expedient way - whichever is your preference, Duke. I think at this stage, everyone is aware of your/John's view on this. I'm not sure John was banking on this level of fame.
So once again, that's your/John's opinion. It's not one shared by plenty...including the worlds most foremost bitcoin hater - Nouriel.

Lyn sees that danger but minimises it by reflecting that adoption my the likes of Microstrategy makes that less likely. I would not be so sanguine if I were her.

Firstly, how do we know it's a danger? The likes of fax machine guy and those that follow him will say that. Personally, I doubt the world has to fall apart (without people's wealth being continually pilfered through inflation).

I would not be so sanguine if I were her.

You're not her.

 

[Leo]

I don't think so. The price of gold has fluctuated anywhere between €250 an ounce to €1750 an ounce over the last 20yrs. Is the demand for jewellery over the last 20yrs that much a factor on this price fluctuation? I would not have thought so, but I may be wrong.

There are interests that control the supply of new gold to some extent, if the almost 60% annual demand for non-investment/ store of value shrank to zero, they would likely attempt to limit supply to protect their income, but I doubt they could fully insulate from that scale of a shock to the system. The Gold Council state that a drop in demand for jewellery as a result of the pandemic is a factor in current pricing.

Anyway, back to the banning of bitcoin. I can not see any conceivable reason why governments, in open and free societies would even consider banning bitcoin unless it is a fundamental threat, perceived or real, of some kind overall to the institutions of the State and the fabric of society and economy at large.
Personally, I do not think it is a threat, but rather it is a benefit to society and the economy at large. Only those who feel threatened by it will want to ban it.

And that's where we differ, I think cryptos bring about the possibility of better money, where the financing of terrorism, human trafficking, etc. is severely hampered, and where the wealthy can't hide income from the state to avoid paying taxes. There appears to be a cohort within the crypto community that are striving to go in the opposite direction, looking to prevent regulatory authorities from performing any oversight or control or governments from having accurate insight into earnings. There is a continued narrative that governments and authorities in general are inherently evil.

My fear is the greatest threat here is to the poorest in society who depend on state supports to feed their families. I don't see bitcoin of itself as offering much in the way of benefit to broader society.

 

[WolfeTone]

I agree that it is very difficult to see bitcoin reaching a position where it serious unsettles monetary policy. But Lyn Alden doe

Yes, I agree. I don't think it's bitcoin that is unsettling monetary policy, it is central banks themselves and the inherent manipulation (human nature) within the system that is achieving that all by itself. Bitcoin is merely an option to opt out of the nonsense.
As mentioned elsewhere, the level of fraud and penalties imposed on licensed financial institutions over the last 20yrs is light years ahead of the levels of fraud, in terms of frequency and amounts, combined over the previous 200yrs.

The current price of bitcoin can only be sustained long term if it achieves a commensurate utility value as a moe (John Kelleher).

Perhaps, that is his opinion, it is very much in the ultimate-destination-return-to-zero basket of opinion.
But when? When is the moment of realisation? This year, next year, 20yrs?

If it did achieve that utility value as an moe it would indeed be a significant factor in the monetary landscape, perhaps enough to lead to significant official curtailment. Lyn sees that danger but minimises it by reflecting that adoption my the likes of Microstrategy makes that less likely. I would not be so sanguine if I were her.

"Once the political donor class owns it as well, which they increasingly do, the game is basically over for banning it. Trying to ban it would be an attack on the balance sheets of corporations, funds, banks, and investors that own it, and would not be popular among millions of voters that own it. "

I would agree more with this assessment from Lyn Alden.
The only reason to try ban bitcoin is if it is perceived as a threat, a threat to the monetary system.
But if the monetary system is under threat from bitcoin....then some may be inclined to own a piece of it rather than to dump it?

 

[Leo]

Astonishing. Here you go, Leo.

OK, perhaps I am astonishingly stupid, but I can't see where that states:

...the motivation behind gold jewelry use is as a store of value. People want to use it as a store of value as much as they want to display their wealth.

 

[tecate]

The Gold Council state that a drop in demand for jewellery as a result of the pandemic is a factor in current pricing.

Jewelry being a sub-category within the over-arching 'store of value' use case of gold.
The 7.49% industrial use case of gold does not in any way account for its price. Why would it - gold was an established store of value long before these peripheral industrial uses cases came about.

There is a continued narrative that governments and authorities in general are inherently evil.

I'm not seeing that. Can you link to a post that describes this inherent evil of government across the board?
You did balk at the suggestion that bitcoin could be used to evade sanctions. Is it yourself that's pointing towards the suggested 'inherent evil'?

TMy fear is the greatest threat here is to the poorest in society who depend on state supports to feed their families. I don't see bitcoin of itself as offering much in the way of benefit to broader society.

So when an emigrant wants to send a remittance home, bitcoin can't contribute towards them not having slippage of 10% through western union and the likes? Bitcoin can't prevent banks and governments from confiscating their wealth? Bitcoin can't assist in a scenario where the local sovereign currency is experiencing high or rampant inflation - with their life savings evapourating? Bitcoin can't help where governments and central banks impose capital controls?

 

[tecate]

OK, perhaps I am astonishingly stupid, but I can't see where that states:

You also suggested that the link to the report couldn't be pulled up with the keywords I provided you with.
Go and read that discussion Leo. The answer is right there in front of you.

 

[Leo]

Jewelry being a sub-category within the over-arching 'store of value' use case of gold.

No, you said 'the motivation', not a small fraction of the motivation.

 

[tecate]

No, you said 'the motivation', not a small fraction of the motivation.

What do you mean?
For the most part, the motivation behind the purchase of gold jewelry is due to its monetary value - and the ability of gold to serve as a store of value....as per the World Gold Council's report.

 

[WolfeTone]

There appears to be a cohort within the crypto community that are striving to go in the opposite direction, looking to prevent regulatory authorities from performing any oversight or control or governments from having accurate insight into earnings. There is a continued narrative that governments and authorities in general are inherently evil.

Yes that is a train of thought alright but I never understood it to be because government and central banks are 'inherently evil'.
More so, human nature of fraud and manipulation when it comes to finance is inherent in all monetary systems. Try as we may, to regulate, license, monitor, adjudicate etc, there is a cohort of people who are paid to try find ways to manipulate or exploit loopholes in the interest of some over others, or implement policies that in their view are 'for the greater good'.
It is this manipulation that ultimately distorts true value and in the long-run fractures societies time and time again. It is human nature, it is futile to expect it to change.

I agree with your earlier point

I think cryptos bring about the possibility of better money, where the financing of terrorism, human trafficking, etc. is severely hampered, and where the wealthy can't hide income from the state to avoid paying taxes.

Also, with regard to the poor. I don't think bitcoin is the solution to poverty, but it has the potential to offer everyone with an Internet connection an option to participate in, and achieve a greater degree of economic and financial autonomy than the prevailing banking system is ever likely to offer.

 

[Leo]

What do you mean?
For the most part, the motivation behind the purchase of gold jewelry is due to its monetary value - and the ability of gold to serve as a store of value....as per the World Gold Council's report.

But that's not what the report says at all! In the section on jewellery demand, not once does it mention store of value. It uses the phrase several times when talking about investment demand.

Read their website, they call out four demand sectors for gold, jewellery, investment, central banks & industrial. Even there, they do not suggest jewellery as an investment or store of value.

 

[tecate]

But that's not what the report says at all! In the section on jewellery demand, not once does it mention store of value. It uses the phrase several times when talking about investment demand.
Read their website, they call out four demand sectors for gold, jewellery, investment, central banks & industrial. Even there, they do not suggest jewellery as an investment or store of value.

Wrong. Page 23. They refer to the Middle/Far East being ground zero for the bulk of the worlds gold jewelry purchases. Within that, they refer to the basis behind it - the passing on of inheritances. They speak of family assets. It's referred in that context because its viewed in that context. You think if gold wasn't scarce, it would have any greater value than an ornate polished rock? Think again!

 

[Duke of Marmalade]

You're not her.

AAM respects anonymity and speculation about poster's identity is verbotten