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Cryptocurrency chaos as China cracks down on ICOs

121 points by petethomas 9y ago

Nursie 9y ago
More interesting was a link at the bottom of the page to comments by Jamie Dimon, that bitcoin is essentially the e-tulip...
- InclinedPlane 9y ago
  That much has always been obvious to anyone paying attention. It's not a currency. Currencies can either be deflationary or inflationary. Cryptocurrencies are inherently deflationary* which makes them bad currencies but perfect for speculative investment. That's the core of every cryptocurrency out there today. The utility as a currency is at best secondary, or even tertiary. It's only a matter of time until those bubbles burst. Edit: fine, amend what I said to be "the vast majority of current cryptocurrencies with high market caps are deflationary". Most usage of cryptocurrencies today is in "investment", not monetary exchange.
  - carlmr 9y ago
    Might also be one of those PT Barnum things. There's a sucker born every minute, and the internet is big to reach all of them.
  - blueprint 9y ago
    > Cryptocurrencies are inherently deflationary How so?
    - tpxl 9y ago
      There's a limited amount of bitcoin to go around.
      - boobsbr 9y ago
        Wouldn't that make the value of a token rise, as there is demand but no supply?
        tpxl 9y ago
        Yes, that is what deflation is, is it not? More goods for the same amount of currency?
        boobsbr 9y ago
        You're right, my bad.
      - blueprint 9y ago
        There are other cryptocurrencies aside from Bitcoin, even if Bitcoin is not able to be a true currency (e.g. fungibility issue). See Monero. It has a tail emission.
        tpxl 9y ago
        Every cryptocurrency based on Bitcoin mechanics has the same problems as Bitcoin. That, as you rightly pointed out, does not discount other cryptocurrencies without these issues. I was aiming solely at Bitcoin (and similar cryptocurrencies).
    - girvo 9y ago
      Most of the so-far released ones have a specific cap on how many tokens will be mined. Bitcoin does, for example. But it's not a hard requirement of cryptocurrencies, I think.
      - mavhc 9y ago
        Bitcoin is also designed to make future coins harder to mine, thus more expensive. The only incentive to sell bitcoin is if you think the entire thing is about to fail.
        sanswork 9y ago
        Bitcoin isn't really designed to do that. It is designed to increase difficulty with competition. If no one was interested in mining bitcoin it would be exactly the same difficulty to mine today as it was one day one.
        mavhc 9y ago
        Doesn't the reward halve every 210000 blocks?
        sanswork 9y ago
        The size of the reward doesn't actually change the difficulty though.
      - deleted 9y ago
        [deleted]
    - simonh 9y ago
      Eventually all the BTC will have been mined and no new BTC will ever be created again, unlike regular currencies in which the money supply can always rise alongside the expansion of the economy. BTC will eventually become a fiscal straight jacket. It may take quite a while to take effect, but is inevitable and the more BTC become integrated into the economy, the more eventual pain it will cause down the line.
      - blueprint 9y ago
        All cryptocurrencies are inherently deflationary because one example of an attempt at a cryptocurrency (BTC) is inherently deflationary?
        simonh 9y ago
        All current attempts at cryptocurrencies, of which there are very, very many have been inherently deflationary. Can you point me to a single one either current or even planned that isn't? We are discussing the real world.
        sanswork 9y ago
        Both Ether and Monero are uncapped and deflationary. So 2 out of the top 10 at the moment. I didn't bother checking beyond that.
        erispoe 9y ago
        If you have a limited supply of currency in a growing economy, it's inherently deflationary. So far I haven't seen proposals for cryptocurrencies that can grow as a function of the underlying economy. Maybe there are some.
      - alexasmyths 9y ago
        The 'main reason' BTC is deflationary is because it's not used as a currency, and as prices rise, people want to 'hold' thereby creating less liquidity etc. It's a funny thing to watch.
      - 9y ago
  - darawk 9y ago
    That's true for pure currencies (e.g. Bitcoin), however most of the newer ones have various functionalities. You may or may not like Ethereum, but its use as a currency is a small part of what it has on offer. And technically at the moment it is inflationary, as well.
  - lui8906 9y ago
    Though this has been a feature of the vast majority of cryptocurrencies, it is not inherent. For example Monero has an inbuilt tail emission once the initial supply is exhausted that will continue indefinitely. See more here: https://getmonero.org/resources/moneropedia/tail-emission.html https://getmonero.org/resources/moneropedia/tail-emission.ht...
  - dnautics 9y ago
    > Cryptocurrencies are inherently deflationary* which makes them bad currencies but perfect for speculative investment. It's so funny that people think that deflationary makes something a bad currency. On the other hand an inflationary currency inherently steals from the poor and gives to the rich. I'd call that a "bad" currency. Inflationary currencies are also perfect for speculative investment. Imagine starting up a 3x leveraged ETF with the underlying debt instrument denominated in bitcoin. Of course with an inflationary currency, the real value of that underlying debt will go down, (and usually, the interest rates stay low), which makes institutionalized risky plays possible.
    - Nursie 9y ago
      > On the other hand an inflationary currency inherently steals from the poor and gives to the rich. How so? The poor have nothing, in fact what they usually have is debt. Inflation makes that shrink over time. And yes, inflationary currencies encourage investment, as you can#'t make gains just by sitting on the medium of exchange. Failing to see why these are bad.
      - richardknop 9y ago
        I'd rephrase the parent comment to say "inflationary currency steals from savers". Imagine someone like me, without debt but trying to save money for something (larger deposit so I don't have to take 30 years mortgage for example). I am not rich by any stretch but I am not poor either. Probably I would fall into middle class (if middle class still exists as it's been disappearing). Inflation is really harming me and people like me. Basically what inflationary currency does is it forces frugal people who would otherwise not go into debt to take loans anyways as they realize that saving is a lose lose idea right now. Better to take a mortgage or two and let inflation slowly erase value of your debt.
        Nursie 9y ago
        Saving's a poor idea at the moment because the interest rates on offer are so tiny. Looking at the last 25(ish) years of UK data the base rates have tended to be above inflation, until the 2008 crisis. But yes, inflation will slowly devalue your debt if the debt is a static amount, borrowing can be a good driver of growth, when managed well. And sitting on piles of currency is not good either - the currency is a medium of exchange, not a store of value, it's better to encourage the economy by encouraging investment over hoarding. Further, deflationary currency values work yesterday over work today, helping people lock in value and higher wealth purely by being older entrants into the market.
  - alexasmyths 9y ago
    "The utility as a currency is at best secondary, or even tertiary. It's only a matter of time until those bubbles burst." The value as a currency is what would give them existential staying power. The USD is not hugely valuable because it's backed by US treasuries - it's valuable because it's extremely liquid and can be used ubiquitously. BTC etc. bubbles may not 'pop' like tulips, because there are a) institutional holders of major blocks that can do things to keep the price up, b) speculative holders have no need to liquidate and I think will want to 'hold' so as to avoid losses and c) there is a small 'actual' area wherein BTC is a currency, which is the black market. There is, globally enough of a 'general black market' to create some demand for BTC as a currency. I think those 3 things combined means that it's possible BTC can hold it's 'paper value' for quite a long time. Two other existential factors: 1) The BTC mania has yet to truly hit mainstream, and it's making it's way globally. 2) The press is still piling on the hyper. A lot of bloggers have positions in BTC they do not disclose. But it's all ridiculous and fake speculation. Jaimie Dimon is technically correct, this BTC 'makes no sense' - but if enough people believe in it enough, then it will exist.
    - vasilipupkin 9y ago
      yeah. Why do people buy gold for their portfolios? for the same reason BTC will exist.
      - Nursie 9y ago
        As a backup, so that if the shit hits the fan they have something that's held value and fascination for thousands of years?
        vasilipupkin 9y ago
        right. So why does it hold value when shit hits the fan? you can't eat it, you can't treat a disease with it. Will it hold value in the future? My point is, it's really just convention. So, the same logic applies to bitcoin.
        9y ago
  - specialist 9y ago
    I think of crypocurrencies as an escrow. Given the bubble, I kinda wish I was brave enough to speculate. But I can't even bring myself to buy a lottery ticket. My loss.
- olalonde 9y ago
  Interesting because Jamie Dimon is the CEO of JPMorgan maybe, but the "e-tulip" analogy has been used and abused ever since Bitcoin was first traded. It's not even wrong... except that all currencies are essentially bubbles.
  - Nursie 9y ago
    Yes, interesting because the comments are not just coming from an internet blow-hard.
    - Eyes 9y ago
      Instead they're coming from someone with vested interest in delegitimizing cryptocurrencies.
      - Nursie 9y ago
        Why would they have a vested interest? If they felt it was a good way to make money they'd be all over it. They are already interested in smart contracts, when I was working with them last year I went to a presentation on ethereum and how interesting it is. It's the speculative nature of BTC and other coins that he seems to be commenting on.
        DigitalSea 9y ago
        >Why would they have a vested interest? If they felt it was a good way to make money they'd be all over it. Because blockchain based currencies like Bitcoin cannot be controlled or manipulated by large entities who have ingrained themselves into the system like a traditional fiat banking system. You can't just create Bitcoin out of thin air and for financial mammoths like JP Morgan who contributed to the 2008 global financial crisis because of irresponsible lending/banking practices, it scares them. I see BTC as being no different to trading stocks, some days you lose and some days you win.
        Nursie 9y ago
- puranjay 9y ago
  I don't visit any ICO sites except for stories on HN. Yet, the last few weeks, I've seen Facebook ads for "initial coin offering" of at least 3 different coins. One was Paragon coin (something to do with weed), another had something to do with speech recognition in the blockchain, and a third one that I can't recall. All of these ads were trying to tout their celebrity credentials (Paragon coin was pushing one of its rapper investors, again, can't remember the name). This is a classic example of a bubble to me. "Celebrity" founders who wouldn't know the first things about the blockchain basically throwing together in-vogue terms ("weed!", "speech recognition!", "AI!") to get initial buyers, then cash out. We've hit peak ICO
  - sidthekid 9y ago
    If we exclude all the silly buzzword-driven ICOs that have sprung up recently to take advantage of the hype, there are plenty of companies that are years old (started after the 2014 surge) and have decent working products. These companies have been waiting for a surge in cryptocurrency adoption and deserve the funding they are getting.
    - TremendousJudge 9y ago
      The internet in the 90s was legit. Yet the Dotcom bubble still happened. There are some actual, successful internet businesses that survived it (Amazon, Paypal, Yahoo, the usual suspects). However, most startups crashed and burned and many people lot a lot of money. The fact that there are legitimate companies doesn't mean that most aren't bullshit
  - koolba 9y ago
    All of that is true except the last line. It's not peak ICO until you see TV informercials. I expect it coming soon though.
  - gourou 9y ago
    It's true lots of celebrities are behind crypto-currencies and are attaching their brand to them. The same can be said for superstar VC firms ( Sequoia Capital, Andreessen Horowitz, Union Square Ventures...) and Filecoin. https://qz.com/1069515/paris-hilton-ico-the-hotel-heiress-joins-floyd-mayweather-the-game-and-other-celebs-endorsing-crypto-tokens/ https://qz.com/1069515/paris-hilton-ico-the-hotel-heiress-jo... https://www.coindesk.com/257-million-filecoin-breaks-time-record-ico-funding/ https://www.coindesk.com/257-million-filecoin-breaks-time-re... Also: > Paragon coin was pushing one of its rapper investors It's The Game
- 0xFFC 9y ago
  So sorry, What do you mean by tulip? I am ESL and couldn't find any useful information from googling.
  - guneydas 9y ago
    https://en.wikipedia.org/wiki/Tulip_mania https://en.wikipedia.org/wiki/Tulip_mania
  - deleted 9y ago
    [deleted]
  - Freak_NL 9y ago
    If you follow the link guneydas provided you can read about a historical event known as tulip mania. In the Dutch republic of the seventeenth century the prices of tulip bulbs kept going up for a couple of years. At the height of this madness a single bulb of a novel species of tulip could even buy you a house in Amsterdam. But a tulip has very little value beyond looking pretty, so the prices were based purely on hype and speculation. Then one day the bubble popped, and tulip bulbs were once again pretty much worthless. This was one of the first economic bubbles in known history, so it is considered an archetype, and people refer to it to make a point about the volatility of a commodity (such as housing or Bitcoin). It has become an idiomatic expression in several languages. Whenever someone refers to something as 'tulip bulbs', that person wants to draw a parallel between that historical event and whatever commodity they are comparing it to. It is a way of saying that something is being invested in simply because everyone is doing it, and because the value of the item keeps going up. And they believe that it is very likely a bubble, because they consider the commodity vastly overpriced.
    - FatalLogic 9y ago
      That's a delightfully clear explanation of the origin of that phrase. However just using the word 'tulip' usually makes the writer's prejudices crystal clear. But if anybody also wants an explanation why the famous 'Tulip Mania' is 90% a myth and is therefore not a useful analogy for understanding 'Bitcoin Mania', then I will politely suggest this essay: https://stratechery.com/2017/tulips-myths-and-cryptocurrencies/ https://stratechery.com/2017/tulips-myths-and-cryptocurrenci... The very fact that an influential figure like Jamie Dimon is opposed to cryptocurrencies IS significant. However, Dimon's actual arguments against cryptocurrencies, which have remained unchanged for the past 4 years, seem very weak, (as least as long as he continues to base his objections on ill-informed slurs such as 'tulips')
- Steeeve 9y ago
  He said more than that. He said it is a fraud, it's only fit for murderers and people living in places such as North Korea, it's stupid, and that he'd fire in a second anyone working at JP Morgan that was found to be trading in bitcoin.
  - 52-6F-62 9y ago
    Which I find quite interesting considering JPMorgan is running research in smart contracts and has their own chain they'd likely want to push. https://www.jpmorgan.com/global/Quorum https://www.jpmorgan.com/global/Quorum >>> Wall Street Journal: JPMorgan Chase, led by CEO Jamie Dimon, is building a new system based on the Ethereum platform
    - TACIXAT 9y ago
      Smart contracts != Bitcoin.
      - 52-6F-62 9y ago
        I'm well aware of that. Ethereum, however, falls into the cryptocurrency space and trades on exchanges like Bitcoin. It can be used for cheap international money transfers -- like Bitcoin. My unspoken point that I feel I should now elucidate was that the optics now have a look of JP Morgan positioning itself to fill in a vacuum they are pushing to create. If they're speaking out publicly like this against it, one could speculate they may be pressuring governments to make more desirable moves for them. They could also be trying to foment FUD in the space to try and empty it while introducing themselves as a secure, traditional, more reliable developer of the technology. They also have little interest in the Ethereum public chain immediately, and I imagine would only adopt it or connect with it if they are forced to. They are marketing their own private chain which they're open-sourcing to entice developer mindshare. The more people buying into their system (out of fear of the unknown currently dominating the space's mode), the more value there is for the top holders -- who of course would be JP Morgan and its top-ranking employees. A more basic interpretation would be, he calls Bitcoin a fraud only because it's not him and the bank making the money in that space.
jpatokal 9y ago
A more accurate description would be "cryptocurrency confusion among Chinese startups attempting to float ICOs". Exchange rates for BTC and ETH vs USD (or CNY, for that matter) have barely budged: https://www.tradingview.com/symbols/BTCUSD/ https://www.tradingview.com/symbols/BTCUSD/ https://www.tradingview.com/symbols/BTCCNY/ https://www.tradingview.com/symbols/BTCCNY/ https://www.tradingview.com/symbols/ETHUSD/ https://www.tradingview.com/symbols/ETHUSD/ ...at least in cryptocurrency terms, where a 10% rise/fall in a day happens regularly anyway and usually for no discernible reason.
- tluyben2 9y ago
  Exactly; there is no chaos here. There have been a lot of things that could be called chaos but this not really. Most speculators I know made a lot less when they heard the media shout chaos this time than previous times as well.
- baby 9y ago
  Litecoin went from 90USD to 60USD.
  - FrozenTuna 9y ago
    It was ~80 dollars a week ago. At no point in the past week has it been near 90 dollars. It has hardly budged as a result of this news.
    - baby 9y ago
      In any case, the news is definitely not making it go up. https://i.imgur.com/8V4grFt.png https://i.imgur.com/8V4grFt.png
interdrift 9y ago
Jamie Dimon is so clueless and is either lobbying for the interests of 2-nd tier accounting banks or the blockchain is accounting beyond his understanding.
irln 9y ago
Seems like terminology is what causes a bunch of the confusion. Bitcoin is used synonymously with ICOs. Bitcoin vs. Ethereum and the ICOs that spawn from it are not the same. Bitcoin is continually referred to as a currency...and it might be or become one but what it seems to be now is just another financial asset. That is, a thing that acts as a storehouse of value like any other tangible or intangible asset. Whether Bitcoin is a good or bad storehouse of value remains to be seen. But mixing terminology confuses the issue.

121 points by petethomas 9y ago

More interesting was a link at the bottom of the page to comments by Jamie Dimon, that bitcoin is essentially the e-tulip...

InclinedPlane 9y ago
That much has always been obvious to anyone paying attention. It's not a currency. Currencies can either be deflationary or inflationary. Cryptocurrencies are inherently deflationary* which makes them bad currencies but perfect for speculative investment. That's the core of every cryptocurrency out there today. The utility as a currency is at best secondary, or even tertiary. It's only a matter of time until those bubbles burst. Edit: fine, amend what I said to be "the vast majority of current cryptocurrencies with high market caps are deflationary". Most usage of cryptocurrencies today is in "investment", not monetary exchange.
- carlmr 9y ago
  Might also be one of those PT Barnum things. There's a sucker born every minute, and the internet is big to reach all of them.
- blueprint 9y ago
  > Cryptocurrencies are inherently deflationary How so?
  - tpxl 9y ago
    There's a limited amount of bitcoin to go around.
    - boobsbr 9y ago
      Wouldn't that make the value of a token rise, as there is demand but no supply?
      - tpxl 9y ago
        Yes, that is what deflation is, is it not? More goods for the same amount of currency?
        boobsbr 9y ago
        You're right, my bad.
    - blueprint 9y ago
      There are other cryptocurrencies aside from Bitcoin, even if Bitcoin is not able to be a true currency (e.g. fungibility issue). See Monero. It has a tail emission.
      - tpxl 9y ago
        Every cryptocurrency based on Bitcoin mechanics has the same problems as Bitcoin. That, as you rightly pointed out, does not discount other cryptocurrencies without these issues. I was aiming solely at Bitcoin (and similar cryptocurrencies).
  - girvo 9y ago
    Most of the so-far released ones have a specific cap on how many tokens will be mined. Bitcoin does, for example. But it's not a hard requirement of cryptocurrencies, I think.
    - mavhc 9y ago
      Bitcoin is also designed to make future coins harder to mine, thus more expensive. The only incentive to sell bitcoin is if you think the entire thing is about to fail.
      - sanswork 9y ago
        Bitcoin isn't really designed to do that. It is designed to increase difficulty with competition. If no one was interested in mining bitcoin it would be exactly the same difficulty to mine today as it was one day one.
        mavhc 9y ago
        Doesn't the reward halve every 210000 blocks?
        sanswork 9y ago
        The size of the reward doesn't actually change the difficulty though.
    - deleted 9y ago
      [deleted]
  - simonh 9y ago
    Eventually all the BTC will have been mined and no new BTC will ever be created again, unlike regular currencies in which the money supply can always rise alongside the expansion of the economy. BTC will eventually become a fiscal straight jacket. It may take quite a while to take effect, but is inevitable and the more BTC become integrated into the economy, the more eventual pain it will cause down the line.
    - blueprint 9y ago
      All cryptocurrencies are inherently deflationary because one example of an attempt at a cryptocurrency (BTC) is inherently deflationary?
      - simonh 9y ago
        All current attempts at cryptocurrencies, of which there are very, very many have been inherently deflationary. Can you point me to a single one either current or even planned that isn't? We are discussing the real world.
        sanswork 9y ago
        Both Ether and Monero are uncapped and deflationary. So 2 out of the top 10 at the moment. I didn't bother checking beyond that.
      - erispoe 9y ago
        If you have a limited supply of currency in a growing economy, it's inherently deflationary. So far I haven't seen proposals for cryptocurrencies that can grow as a function of the underlying economy. Maybe there are some.
    - alexasmyths 9y ago
      The 'main reason' BTC is deflationary is because it's not used as a currency, and as prices rise, people want to 'hold' thereby creating less liquidity etc. It's a funny thing to watch.
    - 9y ago
- darawk 9y ago
  That's true for pure currencies (e.g. Bitcoin), however most of the newer ones have various functionalities. You may or may not like Ethereum, but its use as a currency is a small part of what it has on offer. And technically at the moment it is inflationary, as well.
- lui8906 9y ago
  Though this has been a feature of the vast majority of cryptocurrencies, it is not inherent. For example Monero has an inbuilt tail emission once the initial supply is exhausted that will continue indefinitely. See more here: https://getmonero.org/resources/moneropedia/tail-emission.html https://getmonero.org/resources/moneropedia/tail-emission.ht...
- dnautics 9y ago
  > Cryptocurrencies are inherently deflationary* which makes them bad currencies but perfect for speculative investment. It's so funny that people think that deflationary makes something a bad currency. On the other hand an inflationary currency inherently steals from the poor and gives to the rich. I'd call that a "bad" currency. Inflationary currencies are also perfect for speculative investment. Imagine starting up a 3x leveraged ETF with the underlying debt instrument denominated in bitcoin. Of course with an inflationary currency, the real value of that underlying debt will go down, (and usually, the interest rates stay low), which makes institutionalized risky plays possible.
  - Nursie 9y ago
    > On the other hand an inflationary currency inherently steals from the poor and gives to the rich. How so? The poor have nothing, in fact what they usually have is debt. Inflation makes that shrink over time. And yes, inflationary currencies encourage investment, as you can#'t make gains just by sitting on the medium of exchange. Failing to see why these are bad.
    - richardknop 9y ago
      I'd rephrase the parent comment to say "inflationary currency steals from savers". Imagine someone like me, without debt but trying to save money for something (larger deposit so I don't have to take 30 years mortgage for example). I am not rich by any stretch but I am not poor either. Probably I would fall into middle class (if middle class still exists as it's been disappearing). Inflation is really harming me and people like me. Basically what inflationary currency does is it forces frugal people who would otherwise not go into debt to take loans anyways as they realize that saving is a lose lose idea right now. Better to take a mortgage or two and let inflation slowly erase value of your debt.
      - Nursie 9y ago
        Saving's a poor idea at the moment because the interest rates on offer are so tiny. Looking at the last 25(ish) years of UK data the base rates have tended to be above inflation, until the 2008 crisis. But yes, inflation will slowly devalue your debt if the debt is a static amount, borrowing can be a good driver of growth, when managed well. And sitting on piles of currency is not good either - the currency is a medium of exchange, not a store of value, it's better to encourage the economy by encouraging investment over hoarding. Further, deflationary currency values work yesterday over work today, helping people lock in value and higher wealth purely by being older entrants into the market.
- alexasmyths 9y ago
  "The utility as a currency is at best secondary, or even tertiary. It's only a matter of time until those bubbles burst." The value as a currency is what would give them existential staying power. The USD is not hugely valuable because it's backed by US treasuries - it's valuable because it's extremely liquid and can be used ubiquitously. BTC etc. bubbles may not 'pop' like tulips, because there are a) institutional holders of major blocks that can do things to keep the price up, b) speculative holders have no need to liquidate and I think will want to 'hold' so as to avoid losses and c) there is a small 'actual' area wherein BTC is a currency, which is the black market. There is, globally enough of a 'general black market' to create some demand for BTC as a currency. I think those 3 things combined means that it's possible BTC can hold it's 'paper value' for quite a long time. Two other existential factors: 1) The BTC mania has yet to truly hit mainstream, and it's making it's way globally. 2) The press is still piling on the hyper. A lot of bloggers have positions in BTC they do not disclose. But it's all ridiculous and fake speculation. Jaimie Dimon is technically correct, this BTC 'makes no sense' - but if enough people believe in it enough, then it will exist.
  - vasilipupkin 9y ago
    yeah. Why do people buy gold for their portfolios? for the same reason BTC will exist.
    - Nursie 9y ago
      As a backup, so that if the shit hits the fan they have something that's held value and fascination for thousands of years?
      - vasilipupkin 9y ago
        right. So why does it hold value when shit hits the fan? you can't eat it, you can't treat a disease with it. Will it hold value in the future? My point is, it's really just convention. So, the same logic applies to bitcoin.
        9y ago
- specialist 9y ago
  I think of crypocurrencies as an escrow. Given the bubble, I kinda wish I was brave enough to speculate. But I can't even bring myself to buy a lottery ticket. My loss.
olalonde 9y ago
Interesting because Jamie Dimon is the CEO of JPMorgan maybe, but the "e-tulip" analogy has been used and abused ever since Bitcoin was first traded. It's not even wrong... except that all currencies are essentially bubbles.
- Nursie 9y ago
  Yes, interesting because the comments are not just coming from an internet blow-hard.
  - Eyes 9y ago
    Instead they're coming from someone with vested interest in delegitimizing cryptocurrencies.
    - Nursie 9y ago
      Why would they have a vested interest? If they felt it was a good way to make money they'd be all over it. They are already interested in smart contracts, when I was working with them last year I went to a presentation on ethereum and how interesting it is. It's the speculative nature of BTC and other coins that he seems to be commenting on.
      - DigitalSea 9y ago
        >Why would they have a vested interest? If they felt it was a good way to make money they'd be all over it. Because blockchain based currencies like Bitcoin cannot be controlled or manipulated by large entities who have ingrained themselves into the system like a traditional fiat banking system. You can't just create Bitcoin out of thin air and for financial mammoths like JP Morgan who contributed to the 2008 global financial crisis because of irresponsible lending/banking practices, it scares them. I see BTC as being no different to trading stocks, some days you lose and some days you win.
        Nursie 9y ago
puranjay 9y ago
I don't visit any ICO sites except for stories on HN. Yet, the last few weeks, I've seen Facebook ads for "initial coin offering" of at least 3 different coins. One was Paragon coin (something to do with weed), another had something to do with speech recognition in the blockchain, and a third one that I can't recall. All of these ads were trying to tout their celebrity credentials (Paragon coin was pushing one of its rapper investors, again, can't remember the name). This is a classic example of a bubble to me. "Celebrity" founders who wouldn't know the first things about the blockchain basically throwing together in-vogue terms ("weed!", "speech recognition!", "AI!") to get initial buyers, then cash out. We've hit peak ICO
- sidthekid 9y ago
  If we exclude all the silly buzzword-driven ICOs that have sprung up recently to take advantage of the hype, there are plenty of companies that are years old (started after the 2014 surge) and have decent working products. These companies have been waiting for a surge in cryptocurrency adoption and deserve the funding they are getting.
  - TremendousJudge 9y ago
    The internet in the 90s was legit. Yet the Dotcom bubble still happened. There are some actual, successful internet businesses that survived it (Amazon, Paypal, Yahoo, the usual suspects). However, most startups crashed and burned and many people lot a lot of money. The fact that there are legitimate companies doesn't mean that most aren't bullshit
- koolba 9y ago
  All of that is true except the last line. It's not peak ICO until you see TV informercials. I expect it coming soon though.
- gourou 9y ago
  It's true lots of celebrities are behind crypto-currencies and are attaching their brand to them. The same can be said for superstar VC firms ( Sequoia Capital, Andreessen Horowitz, Union Square Ventures...) and Filecoin. https://qz.com/1069515/paris-hilton-ico-the-hotel-heiress-joins-floyd-mayweather-the-game-and-other-celebs-endorsing-crypto-tokens/ https://qz.com/1069515/paris-hilton-ico-the-hotel-heiress-jo... https://www.coindesk.com/257-million-filecoin-breaks-time-record-ico-funding/ https://www.coindesk.com/257-million-filecoin-breaks-time-re... Also: > Paragon coin was pushing one of its rapper investors It's The Game
0xFFC 9y ago
So sorry, What do you mean by tulip? I am ESL and couldn't find any useful information from googling.
- guneydas 9y ago
  https://en.wikipedia.org/wiki/Tulip_mania https://en.wikipedia.org/wiki/Tulip_mania
- deleted 9y ago
  [deleted]
- Freak_NL 9y ago
  If you follow the link guneydas provided you can read about a historical event known as tulip mania. In the Dutch republic of the seventeenth century the prices of tulip bulbs kept going up for a couple of years. At the height of this madness a single bulb of a novel species of tulip could even buy you a house in Amsterdam. But a tulip has very little value beyond looking pretty, so the prices were based purely on hype and speculation. Then one day the bubble popped, and tulip bulbs were once again pretty much worthless. This was one of the first economic bubbles in known history, so it is considered an archetype, and people refer to it to make a point about the volatility of a commodity (such as housing or Bitcoin). It has become an idiomatic expression in several languages. Whenever someone refers to something as 'tulip bulbs', that person wants to draw a parallel between that historical event and whatever commodity they are comparing it to. It is a way of saying that something is being invested in simply because everyone is doing it, and because the value of the item keeps going up. And they believe that it is very likely a bubble, because they consider the commodity vastly overpriced.
  - FatalLogic 9y ago
    That's a delightfully clear explanation of the origin of that phrase. However just using the word 'tulip' usually makes the writer's prejudices crystal clear. But if anybody also wants an explanation why the famous 'Tulip Mania' is 90% a myth and is therefore not a useful analogy for understanding 'Bitcoin Mania', then I will politely suggest this essay: https://stratechery.com/2017/tulips-myths-and-cryptocurrencies/ https://stratechery.com/2017/tulips-myths-and-cryptocurrenci... The very fact that an influential figure like Jamie Dimon is opposed to cryptocurrencies IS significant. However, Dimon's actual arguments against cryptocurrencies, which have remained unchanged for the past 4 years, seem very weak, (as least as long as he continues to base his objections on ill-informed slurs such as 'tulips')
Steeeve 9y ago
He said more than that. He said it is a fraud, it's only fit for murderers and people living in places such as North Korea, it's stupid, and that he'd fire in a second anyone working at JP Morgan that was found to be trading in bitcoin.
- 52-6F-62 9y ago
  Which I find quite interesting considering JPMorgan is running research in smart contracts and has their own chain they'd likely want to push. https://www.jpmorgan.com/global/Quorum https://www.jpmorgan.com/global/Quorum >>> Wall Street Journal: JPMorgan Chase, led by CEO Jamie Dimon, is building a new system based on the Ethereum platform
  - TACIXAT 9y ago
    Smart contracts != Bitcoin.
    - 52-6F-62 9y ago
      I'm well aware of that. Ethereum, however, falls into the cryptocurrency space and trades on exchanges like Bitcoin. It can be used for cheap international money transfers -- like Bitcoin. My unspoken point that I feel I should now elucidate was that the optics now have a look of JP Morgan positioning itself to fill in a vacuum they are pushing to create. If they're speaking out publicly like this against it, one could speculate they may be pressuring governments to make more desirable moves for them. They could also be trying to foment FUD in the space to try and empty it while introducing themselves as a secure, traditional, more reliable developer of the technology. They also have little interest in the Ethereum public chain immediately, and I imagine would only adopt it or connect with it if they are forced to. They are marketing their own private chain which they're open-sourcing to entice developer mindshare. The more people buying into their system (out of fear of the unknown currently dominating the space's mode), the more value there is for the top holders -- who of course would be JP Morgan and its top-ranking employees. A more basic interpretation would be, he calls Bitcoin a fraud only because it's not him and the bank making the money in that space.

jpatokal 9y ago

A more accurate description would be "cryptocurrency confusion among Chinese startups attempting to float ICOs". Exchange rates for BTC and ETH vs USD (or CNY, for that matter) have barely budged: https://www.tradingview.com/symbols/BTCUSD/ https://www.tradingview.com/symbols/BTCUSD/ https://www.tradingview.com/symbols/BTCCNY/ https://www.tradingview.com/symbols/BTCCNY/ https://www.tradingview.com/symbols/ETHUSD/ https://www.tradingview.com/symbols/ETHUSD/ ...at least in cryptocurrency terms, where a 10% rise/fall in a day happens regularly anyway and usually for no discernible reason.

tluyben2 9y ago
Exactly; there is no chaos here. There have been a lot of things that could be called chaos but this not really. Most speculators I know made a lot less when they heard the media shout chaos this time than previous times as well.
baby 9y ago
Litecoin went from 90USD to 60USD.
- FrozenTuna 9y ago
  It was ~80 dollars a week ago. At no point in the past week has it been near 90 dollars. It has hardly budged as a result of this news.
  - baby 9y ago
    In any case, the news is definitely not making it go up. https://i.imgur.com/8V4grFt.png https://i.imgur.com/8V4grFt.png

interdrift 9y ago

Jamie Dimon is so clueless and is either lobbying for the interests of 2-nd tier accounting banks or the blockchain is accounting beyond his understanding.

irln 9y ago

Seems like terminology is what causes a bunch of the confusion. Bitcoin is used synonymously with ICOs. Bitcoin vs. Ethereum and the ICOs that spawn from it are not the same. Bitcoin is continually referred to as a currency...and it might be or become one but what it seems to be now is just another financial asset. That is, a thing that acts as a storehouse of value like any other tangible or intangible asset. Whether Bitcoin is a good or bad storehouse of value remains to be seen. But mixing terminology confuses the issue.