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Actually, housing crashed when lots of people who had bought housing on credit turned out to be unable to service the debt. I don't think there's a similar sce

by s17n 9y ago

Actually, housing crashed when lots of people who had bought housing on credit turned out to be unable to service the debt. I don't think there's a similar scenario with bitcoin. On the other hand, a large secular demand will always exist for housing. The same is not true for bitcoin.

panarky 9y ago
> Actually, housing crashed when lots of people who had bought housing on credit turned out to be unable to service the debt. For completeness, "housing crashed when lots of people who had bought housing on credit turned out to be unable to service the debt and couldn't sell to someone else for more than they paid" That italicized part is what caused the downward spiral, and that's the part that's relevant to Tethers and cryptocurrencies. Most people with worries about escalating real estate prices had capitulated and bought in before the crash. With no more buyers, the self-reinforcing cycle went into reverse. With cryptocurrency, the vast majority of wealthy people already think it's a scam, bubble, Ponzi or fraud. Unclear how a bubble can form when most people think it's a bubble.
- s17n 9y ago
  A "bubble" doesn't require the participation of all or even most market participants. As long as prices are being driven by short-term speculation, it's a bubble. I think that bitcoin prices are being primarily driven by long-term speculation - if everybody hoping to flip BTC for overnight profit exited the market tomorrow, it wouldn't make that much a difference in the end. Wouldn't surprise me if I am wrong though.
ItsDeathball 9y ago
I think there is always a demand to instantly transmit value across any distance or borders, which cryptocurrencies do very well as long as they have any value at all.
- lucaspiller 9y ago
  At least for Bitcoin, it’s going to be cheaper and easier just to go to a traditional bank or money transfer company. Unless you somehow have a notion that using it will hide the money from the taxman...

by s17n 9y ago

panarky 9y ago

> Actually, housing crashed when lots of people who had bought housing on credit turned out to be unable to service the debt. For completeness, "housing crashed when lots of people who had bought housing on credit turned out to be unable to service the debt and couldn't sell to someone else for more than they paid" That italicized part is what caused the downward spiral, and that's the part that's relevant to Tethers and cryptocurrencies. Most people with worries about escalating real estate prices had capitulated and bought in before the crash. With no more buyers, the self-reinforcing cycle went into reverse. With cryptocurrency, the vast majority of wealthy people already think it's a scam, bubble, Ponzi or fraud. Unclear how a bubble can form when most people think it's a bubble.

s17n 9y ago
A "bubble" doesn't require the participation of all or even most market participants. As long as prices are being driven by short-term speculation, it's a bubble. I think that bitcoin prices are being primarily driven by long-term speculation - if everybody hoping to flip BTC for overnight profit exited the market tomorrow, it wouldn't make that much a difference in the end. Wouldn't surprise me if I am wrong though.

ItsDeathball 9y ago

I think there is always a demand to instantly transmit value across any distance or borders, which cryptocurrencies do very well as long as they have any value at all.

lucaspiller 9y ago
At least for Bitcoin, it’s going to be cheaper and easier just to go to a traditional bank or money transfer company. Unless you somehow have a notion that using it will hide the money from the taxman...