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What's with all the extreme negativity with Bitcoin and its trading price on HN? I've been noticing that in all the BTC related threads recently. Yes, this is

by asenna 9y ago

What's with all the extreme negativity with Bitcoin and its trading price on HN? I've been noticing that in all the BTC related threads recently. Yes, this is possibly getting too large too fast. Yes there is a chance this is a bubble because the barbers and shoeshine boys are talking about it. But there is also a chance that we genuinely are at the beginning of the transition from Fiat currencies to crypto (beginning of the S-curve mass adoption). And given that we live in the digital connected age dealing with a virtual concept, it takes a lot less time for things to catch on and spread like wild fire, as opposed to other transitions in history like snail mail -> Email (which also was not that slow). And if at all that crypto vision does come true, the value of BTC and some of these other top cryptos would be worth a _lot_ more than it is right now. Again, this could go the other way and it could all come crashing down soon and maybe the hype dies down. But I feel a majority of the HN community is just waiting for that to happen which I did not expect.

nextstep 9y ago
Some of the negativity about Bitcoin in particular is around the relative lack of utility of the actual network, and how this usefulness hasn’t grown with the price. Currently, Bitcoin Core (the dominant fork still) has ridiculously large transaction fees (sometimes averaging over $20 for a given day) and transactions can take hours or days. There’s also some contention because Bitcoin Cash (the other fork of Bitcoin) is in a lot of ways closer to the original design of Bitcoin (“peer-to-peer cash”), but is having to fight for the name “Bitcoin”.
- asenna 9y ago
  I agree, Bitcoin being the largest has a lot of issues with governance and the community not being able to move fast on the scaling issues. I'm not too familiar with the core team's development plans but there's a lot of scaling work and research going on with Ethereum and Litecoin, etc and eventually I'm sure whatever works would flow into Bitcoin as well. I think having the first-mover advantage and name recognition, the network effect that it has right now and the global media's attention, it looks really difficult for a smaller coin with better tech overtaking BTC anytime soon. We've all seen technologies that are more advanced than an established player in a field but a lot of times, that does not matter. That's what I believe at least for the short to mid-term timeline.
  - ace_of_spades 9y ago
    Yeah, so what can we do to change this? First step, don‘t buy into the hype and advocate against bitcoin at every step. People need to know that bitcoin as a technology is not what we need and will die hopefully sooner rather than later.
- MadSudaca 9y ago
  There are many other cryptocurrencies. It's a well known fact that Bitcoin is probably one the worst ones at the moment. Its hopes rest on the core team's ability to provide an effective solution to the scaling problem, and so far their track record leaves much to be desired. Meanwhile there are new coins based on new protocols emerging, some showing a lot of promise.
- prawn 9y ago
  The negativity often seems to go beyond reasonable criticism and delve into spite. As another commenter suggested, I suspect a bit of jealousy is at play and it wouldn't surprise me if a few spiteful commenters wouldn't discuss the shortcomings in a much different way if they held Bitcoin. Obviously, there is more than enough happy-clapping on the side of speculators to balance everything out, but I do wish the conversation more often found a practical mid-ground.
  - spookthesunset 9y ago
    > I do wish the conversation more often found a practical mid-ground. There isn't much middle ground. Bitcoin has proven to do a horrible job at just about every single thing it was originally marketed as. It isn't free, it isn't instant, it isn't permissionless, it isn't anonymous, it isn't secure, and it isn't decentralized. The only thing bitcoin has going for it is the price, which is more likely than not fueled largely by exchanges pulling funny business.
  - ace_of_spades 9y ago
    You actually hit the nail on the head but come away with a different conclusion than me... People do discuss Bitcoin differently depending on whether they have bought in or not. But the dangerous effect is the opposite of what you aluded to. People attached to bitcoin who have money on the line engage in acrobatic brain gymnastics to find ways to rationalize the value of it because they desperately want their gains to be real. At the moment they simply aren‘t. Bitcoin has failed it‘s initial mission, it‘s impractical and people just speculate that somehow things might change in the future. It‘s just a mind game right now. So your mid-ground would require me to accept that there is some value in the speculation regarding bitcoin which is a tough sell. It‘s mostly greed and people will be hurt by it at some point. Let‘s stop before it gets to messy!
solotronics 9y ago
for me at least it is an opportunity to keep my own wealth. If I can keep my own record of wealth why would I entrust a third party that doesn't care anything about me? Perfect example is Wells Fargo opening accounts and charging people.
- jaymzcampbell 9y ago
  Totally this. Brexit has me not trusting the government I reside under as far as I could throw it. I believe in crypto as an ideological position and hope to see it continue to grow. It might not be Bitcoin that wins in the end but decentralized, truly global, non-governmental mechanisms of money control are needed. There is far too much power in their hands as they push for "cash" to become digital (i.e. traditional bank accounts with access via debit/credit cards).
- alexasmyths 9y ago
  "for me at least it is an opportunity to keep my own wealth. " This is a really poor reason to use BTC. A) BTC is supposed to be a currency - generally, a currency is not where you should be storing wealth. Currencies are not designed to be 'stores of value' - they are there to facilitate economic activity and transactions. If you want to 'store wealth' - put it in real estate, bonds or equities. Commodities. Other currencies. A broad mix/basket of many of them. B) There's no reason at all to think that BTC will necessarily be worth more/less than another currency. Why do you think BTC will 'always go up'? Much of the BTC hype may have already been had. C) By simply keeping your currency in a trivial savings account, will roughly protect it from inflation. In addition - most bank accounts are Federally insured - in case something goes wrong, you get up to $200K back etc.. D) Risk. BTC could go to zero tomorrow. Probably not - but possibly. It's extremely volatile = bad store of value. People have this really odd view that 'currency = value' ... it's not ... currency is just a 'medium of exchange' - so you only need to hold it when you want to transact with someone else in a common/liquid way. Over any reasonable length of time, currency is generally not a good place to hold value, and it's not designed for that. If you have lot's of currency, trade it for something else, spread it out. There will never, ever be a currency or any other magical currency store of value that will provide what you are kind of implying. Never. This is because the ratio of 'things people need' and the 'amount of currency they need to transact for' is constantly in flux, ergo, a 'fixed' currency constantly in flux relative to that.
wepple 9y ago
I’d hazard a guess that a lot of the fundamentals haven’t really changed in an interesting way - it’s just becoming more widespread and popular, which isn’t interesting from a tech perspective. And I don’t disagree with throwing a small amount of cold water on the hype - the number of headlines aren’t in line with the actual utility of it.
forgotpassagan 9y ago
For technical reasons, Bitcoin honestly sucks. The block rate is so low that transactions cost many dollars and take hours to confirm. This is only going to continue to get worse, as it turns out that having a global ledger is actually the opposite of a decentralized system. I can't do anything with Bitcoin that I can't do more easily with my credit card. It offers no value except a tool for rampant speculation. Block chain is junk, and while I see promise in the future I strongly believe we're in the Myspace stage. Something better will come along in a few years and blow this garbage away. Something that's actually usable as a real currency in all the ways I can use a dollar and maybe more.
- pzxc 9y ago
  The lightning network could fix everything, or fail spectacularly. I think an even bigger danger than failing spectacularly is if they take too long to roll it out. Other cryptocurrencies are already gaining some favor because of the situation BTC is in now with the high transaction fees. It has a good chance of working, in my opinion (the lightning network), if they don't dawdle too long. But the clock is ticking.
  - forgotpassagan 9y ago
    IMO Lightning network solves a non-problem. It only sets up a transactionless channel between two parties. The whole promise of Bitcoin was secure transfer to anyone. Maintaining a balance between two parties is trivial and solved thousands of years ago. The whole reason we have currency is to allow transactions between people that don't trust each other, so I don't think Lightning network will do anything significant
    - Nydhal 9y ago
      Most transactions fall into the first -solved- category, a minority is in the second.
    - ripberge 9y ago
      Lighting network channels don't require you to trust the other party. Lighting network is also distributed, you don't need a direct channel between you and another party to pay them. You just have to find a route.
matchcohnn 9y ago
Because at the moment, bitcoin has no redeeming qualities. - it is not transactional, as each trade costs $30-40. as exchanges hold the orders for weeks - it is not rare, as there are tons of viable cryptocurrencies coming out each day - it is not safe, as exchanges go bankrupt and shutdown. - it is not stable, as prices fluctuate wildly each day. Downside could be 90%, upside could be 20%. - it is not fast, as 100K+ transactions awaits - it is not anonymous - it is not valued correctly, as a sell order of $100M will most likely reduce the price by 50%
- dang 9y ago
  Single-purpose accounts are not a good fit for HN and you've repeated this stuff several times already, so I've banned this account. If you don't want to be banned on HN, you're welcome to email hn@ycombinator.com and give us reason to believe that you'll use the site as intended in the future. That means posting comments as part of thoughtful conversation about intellectually curious things. It definitely does not mean hammering an agenda.
theoh 9y ago
Blockchain-based currencies are not an acceptable replacement for the existing monetary system because of the extreme brittleness of their mechanisms. You really are completely on your own when it comes to things like getting hacked, losing your wallet, etc. And we know that nobody's machine is secure against a persistent attacker. The social mechanisms (regulatory etc.) around retail banking are a crucial safety measure for individuals in the first instance. Bitcoin discards all that. If you repair the safety net, by creating a web of trust between principals (e.g. banks), proof-of-work becomes an unnecessary nuisance. From the recent ING paper: "The average person [...] dislike[s] having no rights, no recourse, no guarantees, no legal coverage, nothing. They just want secure, reliable and hassle-free access to their money, and if they forget their password, they want to be able to call their provider and have the password reset for them. And with reason: recent analysis suggests that up to about 20% of all Bitcoin in circulation may be lost forever, due to, for example, misdirected transactions, lost passwords and crashed hard disks. Banks are the usual providers of custodian functions preventing loss and theft." It's possible to be anti-Bitcoin while accepting that digital money is the future.
- akira2501 9y ago
  > because of the extreme brittleness of their mechanisms. On top of all that, we're still entirely unsure how the system is going to function once all bitcoin has been mined and it becomes a pure transaction system.
- prawn 9y ago
  Could that be solved by some sort of banking layer between such-inclined users and their holdings, without interfering with the core aims of Bitcoin? e.g., an abstraction where the next generation bank provides some extra level of security or recourse. I can't imagine that banks as they are today are brilliantly efficient.
  - theoh 9y ago
    The ING paper continues "The fact that they [banks] do not (yet) provide custodian functions for Bitcoin (e.g. for regulatory reasons) does not mean that the general public would not need or want those services for cryptocurrency. In fact, many Bitcoin users choose to keep their wallets with online providers – meaning that even in today’s Bitcoin universe, there is a clear role for intermediaries." The Bitcoin/blockchain-agnostic term for the basic abstraction these intermediaries share is "distributed ledger", though that doesn't solve the whole problem. https://en.wikipedia.org/wiki/Distributed_ledger https://en.wikipedia.org/wiki/Distributed_ledger
olalonde 9y ago
A lot of the negativity comes from people who missed the boat, sold too early, etc. Also, people who don't understand bitcoin or confuse it with ICOs/blockchain crap. I'd say that's the bulk of it to be honest.
- geetfun 9y ago
  I agree. I "missed out" on purchasing some bitcoin assets early on. So seeing a lot of the rise right now, I don't share in the excitement as -- I would imagine -- someone who's holding a few thousand BTCs. Having said that, I think there's a bit of (healthy) skepticism amongst those of us who hold "traditional" assets regarding BTC. As someone who holds real estate as part of the investment portfolio, I understand and see the return from the rental properties. Stocks give me dividends. Bonds give me interest payments. Currently, all these yields are in dollars. But would I gladly accept BTC as payment? Currently -- no. It's too volatile for it to be useful. And the entire issue of blockchain transaction backlog is worrisome. So if a tenant comes to me and says, "I'll pay this month's rent in BTC," I'd still have to say, "No thanks. I'll take dollars please."
  - etr-strike 9y ago
    Your “real estate” investment is propped up by the federal reserve. You were bailed out at the expense of savers. I’m glad you missed out on bitcoin. It wasn’t made for you.
rifung 9y ago
> But there is also a chance that we genuinely are at the beginning of the transition from Fiat currencies to crypto (beginning of the S-curve mass adoption) I can only speak for myself but I see this chance as practically being 0. As far as I can tell the only people who would need something like Bitcoin are those who participate in illegal/immoral activity. Seeing as there is no regulation, I don't think it's far fetched to believe those who have a large amount of Bitcoin, such as hackers who were paid ransoms in it, would have motivation to try to increase the perceived value of it. Personally I believe that people, especially those who already participate in illegal activity, trying to profit is easy for my mind to grasp and believe than for some technological revolution. I suppose the bias from my personal experiences shows as well given that I haven't met a single person who has purchased Bitcoin for its utility but many who have bought it because "it's going to go UP!!!!!!!!!". I suppose personally I don't want to see people throw their money away, especially because in this case I believe it will benefit scammers, and that's why I have a negative attitude towards it.
- MadSudaca 9y ago
  The total market cap of all cryptocurrencies is .6 trillion USD. There's dozens of coins with teams and communities trying to make them succeed and provide value. There's a lot of work and creativity involved in providing new technological solutions to overcome the limitations of older cryptocurrencies. I think you should give the cryptoscene another chance and do some research on what's going on. Saying that all this work, money and effort is something that will only benefits scammers is a bit unfair.
  - spookthesunset 9y ago
    > Saying that all this work, money and effort is something that will only benefits scammers is a bit unfair It's entirely fair. Bitcoin is a solution in search of a problem. The only "solution" it's solved so far is lining the pockets of the folks at the top of its pyramid. Bitcoin has been around for, what, 9 years now? If it was going to see mainstream adoption, it would have happened a long time ago.
jjeaff 9y ago
>But there is also a chance that we genuinely are at the beginning of the transition from Fiat currencies to crypto Maybe, but the current price is no reflection of that. The current price is based on speculation, not utility. No "maybe" about it.
- drcross 9y ago
  That's just your opinion. My opinion is that every dollar, euro and yen that stored outside the current financial system is being safely utilised in the bitcoin store of value.
pcarolan 9y ago
Some of us think that burning coal at 250kwh[1] per transaction isn't sustainable. [1]https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/ https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-...
sillysaurus3 9y ago
The primary concern is that if BTC wins, we will all be subservient to an algorithm which no one has any incentive to change. We'll lose all financial controls. Worse, people with massive crypto fortunes can act as evil as they want, and society can't do anything to stop them. Right now we can take the money away from the powerful, if society collectively agrees to. That will become impossible. If BTC had no upper limit, I would agree with you. But Satoshi capped it, and theories abound as to why. The most reasonable explanation is that he wanted to incentivize network strength: more participants, the healthier the network, and deflationary currency encourages adoption from a game theory point of view. But think about the endgame. What do you think will happen when coins stop being minted? When there are only 400 BTC left to mine? What will happen to all those miners and the vast worldwide mining apparatus? If Satoshi were still around, he would likely want to remove the hard cap. And then we'd be in a different situation. But he didn't, so we're not.
- jstanley 9y ago
  Why would it make any difference if Satoshi were still around? He can't make arbitrary changes to the consensus rules any more easily than anyone else can. And you might not be able to take money away from the powerful, but you can still throw them in prison.
  - sillysaurus3 9y ago
    Try throwing Putin into prison. That's the kind of threat model at stake here. Another Putin emerging. And this one may be much less predictable. If Satoshi were around, his opinion would carry weight. He's the spiritual leader and mysterious benefactor, the only person to have ever solved the byzantine generals problem with sybil resistance. If he spoke, people would listen more closely than to others. In fact, people are resisting change mostly because they want to stick to satoshi's original vision. So he is speaking to us, in a way, by saying nothing. That's him communicating his vision to us, and us agreeing with it. If he were still around, he might very well say "I only did that to ensure the network stayed healthy! We still have an endgame to think about! The miners will eventually run out of coins to mine, and it's in our interests to continue the status quo rather than degenerate into that world."
Chathamization 9y ago
There seems to be a ton of excitement about Bitcoin now, not because of what it can do, but almost entirely because of speculation. Almost none of the general public interest in Bitcoin stems from an interest in what Bitcoin is; the vast majority of people simply see it as a get rich quick asset. And the reason why people are only interested in it for speculative reasons is because it doesn't seem to have any particular benefit for most people. And if this is a speculative bubble the way it looks like it is, it will end like other speculative bubbles. A few people will get absurdly rich, not because they added any value to the system, but because they were able to time the market. Their money will come from the many others who will lose a lot because they tried to do the same thing but were too late. Beyond that, there seems to be a small group of people who are interested in it because they see it as an alternative to fiat currency. But strong opposition to fiat currency seems to be one of those odd economic beliefs that some people get, similar to the people who think that our society would be great if we just got rid of money and had a barter system. Outside of fringe beliefs, fiat currency is generally seen as a useful tool.
- drcross 9y ago
  I'm tired of this perspective. Just because you "feel" people are in bitcoin for "the wrong reason" doesn't make it bad. Similarly if people start buying electric vehicles because they are faster than gas cars it doesn't make them "worse" than people who buy them for environment change. A lot of millenials have learned a lot about the existing financial system due to Bitcoin, even if it was initially to make a quick buck, and I suspect there's no way back to fiat for a lot of them.
  - Anderkent 9y ago
    > A lot of millenials have learned a lot about the existing financial system due to Bitcoin, even if it was initially to make a quick buck, and I suspect there's no way back to fiat for a lot of them. This is exactly the kind of one-sided perspective that makes me very sceptical. No, they didn't 'leave fiat' in any way, and they never will. At best they can hedge against it a little. But while that might be personally profitable, it is not clear at all whether it is a net benefit; the main problem of western economies nowadays seems to be too tight monetary policy, and crypto is tighter than fiat.
alexchantavy 9y ago
> Again, this could go the other way and it could all come crashing down soon and maybe the hype dies down. The housing market crashed in 2008 when everyone defaulted on their loans and all the speculation on those assets went upside down. I wonder what a cryptocurrency crash would look like.
- gabesullice 9y ago
  A blip
matchcohnn 9y ago
Oh yeah one more downside..... There is no one to catch a falling knife. Like right now as we speak
volgo 9y ago
People have listed some good reasons, but no one hit the real painful and unpleasant reason: People are negative about it because they missed the ride up. It was at $1k earlier this year when these people started dissing it and calling it a Ponzi scheme, and now it's at $15k. Those people missed out a 15x gain, something most startups they've labored their life over can't do. It's human nature to be jealous
deleted 9y ago
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ace_of_spades 9y ago
This is what I am actually afraid of! Why would you want to become bitcoin worth even more... when its value is so unevenly distributed towards early adopters? ... when it is using as much power as a medium-sized country while only providing a few transactions per second at a price of $10+? Before you jump on the hype train, just ask yourself if it really is a train you want to get on, consequences and all. Alas I fear lot of people are already too invested in bitcoin as to see the problems with it.
camillomiller 9y ago
Whatever happens, can we fucking stop to shorten them to crypto!? Crypto does not mean cryptocurrency, for God’s sake!!! https://www.schneier.com/blog/archives/2017/12/crypto_is_being.html https://www.schneier.com/blog/archives/2017/12/crypto_is_bei...
- occamrazor 9y ago
  To be fair, crypto also doesn’t mean cryptography, but in programming circles they are often used as synonyms. Crypto just means hidden.
  - camillomiller 9y ago
    Of course, it's from Greek. I'm not saying it should be used to mean cryptography, nobody's claiming that. I'm just saying that throwing it around as a shortened version of cryptocurrency is the most ill-conceived usage you could possibly make of it. Both from an etymological and lexical standpoint.
anonytrary 9y ago
I mean this is crashing now, but at some point it will go back up. Blockchain technology will continue to make people in high places very mad. It's here to stay. Is there a lot of money in it right now for the stage it's in? Absolutely. Blockchains are objectively a better system. If the government pulls a Napster on Bitcoin (and Blockchains), I hope they get whatever is coming to them. Napster -- it had its problems with fairness and ownership, and a reasonable case could be made as to why it hurt creative producers. But Bitcoin/Blockchains? Literally no case can be made as to why we have banks when we have Bitcoin. It helps everyone except the people in charge of the inferior systems. For example, what happened with Slavery? There was a lot of old money in Slavery and at some point we had to be like "sorry guys, your system sucks". Of course, that ended with war. But at the end of the day, we are in a better system. I can proudly say "slavery is disgusting" without fear of being hurt by the government. Today we live in a time of financial slavery. A time where certain people get to control our money and thus our means. When will we be able to say that "banks are disgusting"? I am waiting for that day.
deleted 9y ago
[deleted]

by asenna 9y ago

nextstep 9y ago

Some of the negativity about Bitcoin in particular is around the relative lack of utility of the actual network, and how this usefulness hasn’t grown with the price. Currently, Bitcoin Core (the dominant fork still) has ridiculously large transaction fees (sometimes averaging over $20 for a given day) and transactions can take hours or days. There’s also some contention because Bitcoin Cash (the other fork of Bitcoin) is in a lot of ways closer to the original design of Bitcoin (“peer-to-peer cash”), but is having to fight for the name “Bitcoin”.

asenna 9y ago
I agree, Bitcoin being the largest has a lot of issues with governance and the community not being able to move fast on the scaling issues. I'm not too familiar with the core team's development plans but there's a lot of scaling work and research going on with Ethereum and Litecoin, etc and eventually I'm sure whatever works would flow into Bitcoin as well. I think having the first-mover advantage and name recognition, the network effect that it has right now and the global media's attention, it looks really difficult for a smaller coin with better tech overtaking BTC anytime soon. We've all seen technologies that are more advanced than an established player in a field but a lot of times, that does not matter. That's what I believe at least for the short to mid-term timeline.
- ace_of_spades 9y ago
  Yeah, so what can we do to change this? First step, don‘t buy into the hype and advocate against bitcoin at every step. People need to know that bitcoin as a technology is not what we need and will die hopefully sooner rather than later.
MadSudaca 9y ago
There are many other cryptocurrencies. It's a well known fact that Bitcoin is probably one the worst ones at the moment. Its hopes rest on the core team's ability to provide an effective solution to the scaling problem, and so far their track record leaves much to be desired. Meanwhile there are new coins based on new protocols emerging, some showing a lot of promise.
prawn 9y ago
The negativity often seems to go beyond reasonable criticism and delve into spite. As another commenter suggested, I suspect a bit of jealousy is at play and it wouldn't surprise me if a few spiteful commenters wouldn't discuss the shortcomings in a much different way if they held Bitcoin. Obviously, there is more than enough happy-clapping on the side of speculators to balance everything out, but I do wish the conversation more often found a practical mid-ground.
- spookthesunset 9y ago
  > I do wish the conversation more often found a practical mid-ground. There isn't much middle ground. Bitcoin has proven to do a horrible job at just about every single thing it was originally marketed as. It isn't free, it isn't instant, it isn't permissionless, it isn't anonymous, it isn't secure, and it isn't decentralized. The only thing bitcoin has going for it is the price, which is more likely than not fueled largely by exchanges pulling funny business.
- ace_of_spades 9y ago
  You actually hit the nail on the head but come away with a different conclusion than me... People do discuss Bitcoin differently depending on whether they have bought in or not. But the dangerous effect is the opposite of what you aluded to. People attached to bitcoin who have money on the line engage in acrobatic brain gymnastics to find ways to rationalize the value of it because they desperately want their gains to be real. At the moment they simply aren‘t. Bitcoin has failed it‘s initial mission, it‘s impractical and people just speculate that somehow things might change in the future. It‘s just a mind game right now. So your mid-ground would require me to accept that there is some value in the speculation regarding bitcoin which is a tough sell. It‘s mostly greed and people will be hurt by it at some point. Let‘s stop before it gets to messy!

solotronics 9y ago

for me at least it is an opportunity to keep my own wealth. If I can keep my own record of wealth why would I entrust a third party that doesn't care anything about me? Perfect example is Wells Fargo opening accounts and charging people.

jaymzcampbell 9y ago
Totally this. Brexit has me not trusting the government I reside under as far as I could throw it. I believe in crypto as an ideological position and hope to see it continue to grow. It might not be Bitcoin that wins in the end but decentralized, truly global, non-governmental mechanisms of money control are needed. There is far too much power in their hands as they push for "cash" to become digital (i.e. traditional bank accounts with access via debit/credit cards).
alexasmyths 9y ago
"for me at least it is an opportunity to keep my own wealth. " This is a really poor reason to use BTC. A) BTC is supposed to be a currency - generally, a currency is not where you should be storing wealth. Currencies are not designed to be 'stores of value' - they are there to facilitate economic activity and transactions. If you want to 'store wealth' - put it in real estate, bonds or equities. Commodities. Other currencies. A broad mix/basket of many of them. B) There's no reason at all to think that BTC will necessarily be worth more/less than another currency. Why do you think BTC will 'always go up'? Much of the BTC hype may have already been had. C) By simply keeping your currency in a trivial savings account, will roughly protect it from inflation. In addition - most bank accounts are Federally insured - in case something goes wrong, you get up to $200K back etc.. D) Risk. BTC could go to zero tomorrow. Probably not - but possibly. It's extremely volatile = bad store of value. People have this really odd view that 'currency = value' ... it's not ... currency is just a 'medium of exchange' - so you only need to hold it when you want to transact with someone else in a common/liquid way. Over any reasonable length of time, currency is generally not a good place to hold value, and it's not designed for that. If you have lot's of currency, trade it for something else, spread it out. There will never, ever be a currency or any other magical currency store of value that will provide what you are kind of implying. Never. This is because the ratio of 'things people need' and the 'amount of currency they need to transact for' is constantly in flux, ergo, a 'fixed' currency constantly in flux relative to that.

wepple 9y ago

I’d hazard a guess that a lot of the fundamentals haven’t really changed in an interesting way - it’s just becoming more widespread and popular, which isn’t interesting from a tech perspective. And I don’t disagree with throwing a small amount of cold water on the hype - the number of headlines aren’t in line with the actual utility of it.

forgotpassagan 9y ago

For technical reasons, Bitcoin honestly sucks. The block rate is so low that transactions cost many dollars and take hours to confirm. This is only going to continue to get worse, as it turns out that having a global ledger is actually the opposite of a decentralized system. I can't do anything with Bitcoin that I can't do more easily with my credit card. It offers no value except a tool for rampant speculation. Block chain is junk, and while I see promise in the future I strongly believe we're in the Myspace stage. Something better will come along in a few years and blow this garbage away. Something that's actually usable as a real currency in all the ways I can use a dollar and maybe more.

pzxc 9y ago
The lightning network could fix everything, or fail spectacularly. I think an even bigger danger than failing spectacularly is if they take too long to roll it out. Other cryptocurrencies are already gaining some favor because of the situation BTC is in now with the high transaction fees. It has a good chance of working, in my opinion (the lightning network), if they don't dawdle too long. But the clock is ticking.
- forgotpassagan 9y ago
  IMO Lightning network solves a non-problem. It only sets up a transactionless channel between two parties. The whole promise of Bitcoin was secure transfer to anyone. Maintaining a balance between two parties is trivial and solved thousands of years ago. The whole reason we have currency is to allow transactions between people that don't trust each other, so I don't think Lightning network will do anything significant
  - Nydhal 9y ago
    Most transactions fall into the first -solved- category, a minority is in the second.
  - ripberge 9y ago
    Lighting network channels don't require you to trust the other party. Lighting network is also distributed, you don't need a direct channel between you and another party to pay them. You just have to find a route.

matchcohnn 9y ago

Because at the moment, bitcoin has no redeeming qualities. - it is not transactional, as each trade costs $30-40. as exchanges hold the orders for weeks - it is not rare, as there are tons of viable cryptocurrencies coming out each day - it is not safe, as exchanges go bankrupt and shutdown. - it is not stable, as prices fluctuate wildly each day. Downside could be 90%, upside could be 20%. - it is not fast, as 100K+ transactions awaits - it is not anonymous - it is not valued correctly, as a sell order of $100M will most likely reduce the price by 50%

dang 9y ago
Single-purpose accounts are not a good fit for HN and you've repeated this stuff several times already, so I've banned this account. If you don't want to be banned on HN, you're welcome to email hn@ycombinator.com and give us reason to believe that you'll use the site as intended in the future. That means posting comments as part of thoughtful conversation about intellectually curious things. It definitely does not mean hammering an agenda.

theoh 9y ago

Blockchain-based currencies are not an acceptable replacement for the existing monetary system because of the extreme brittleness of their mechanisms. You really are completely on your own when it comes to things like getting hacked, losing your wallet, etc. And we know that nobody's machine is secure against a persistent attacker. The social mechanisms (regulatory etc.) around retail banking are a crucial safety measure for individuals in the first instance. Bitcoin discards all that. If you repair the safety net, by creating a web of trust between principals (e.g. banks), proof-of-work becomes an unnecessary nuisance. From the recent ING paper: "The average person [...] dislike[s] having no rights, no recourse, no guarantees, no legal coverage, nothing. They just want secure, reliable and hassle-free access to their money, and if they forget their password, they want to be able to call their provider and have the password reset for them. And with reason: recent analysis suggests that up to about 20% of all Bitcoin in circulation may be lost forever, due to, for example, misdirected transactions, lost passwords and crashed hard disks. Banks are the usual providers of custodian functions preventing loss and theft." It's possible to be anti-Bitcoin while accepting that digital money is the future.

akira2501 9y ago
> because of the extreme brittleness of their mechanisms. On top of all that, we're still entirely unsure how the system is going to function once all bitcoin has been mined and it becomes a pure transaction system.
prawn 9y ago
Could that be solved by some sort of banking layer between such-inclined users and their holdings, without interfering with the core aims of Bitcoin? e.g., an abstraction where the next generation bank provides some extra level of security or recourse. I can't imagine that banks as they are today are brilliantly efficient.
- theoh 9y ago
  The ING paper continues "The fact that they [banks] do not (yet) provide custodian functions for Bitcoin (e.g. for regulatory reasons) does not mean that the general public would not need or want those services for cryptocurrency. In fact, many Bitcoin users choose to keep their wallets with online providers – meaning that even in today’s Bitcoin universe, there is a clear role for intermediaries." The Bitcoin/blockchain-agnostic term for the basic abstraction these intermediaries share is "distributed ledger", though that doesn't solve the whole problem. https://en.wikipedia.org/wiki/Distributed_ledger https://en.wikipedia.org/wiki/Distributed_ledger

olalonde 9y ago

A lot of the negativity comes from people who missed the boat, sold too early, etc. Also, people who don't understand bitcoin or confuse it with ICOs/blockchain crap. I'd say that's the bulk of it to be honest.

geetfun 9y ago
I agree. I "missed out" on purchasing some bitcoin assets early on. So seeing a lot of the rise right now, I don't share in the excitement as -- I would imagine -- someone who's holding a few thousand BTCs. Having said that, I think there's a bit of (healthy) skepticism amongst those of us who hold "traditional" assets regarding BTC. As someone who holds real estate as part of the investment portfolio, I understand and see the return from the rental properties. Stocks give me dividends. Bonds give me interest payments. Currently, all these yields are in dollars. But would I gladly accept BTC as payment? Currently -- no. It's too volatile for it to be useful. And the entire issue of blockchain transaction backlog is worrisome. So if a tenant comes to me and says, "I'll pay this month's rent in BTC," I'd still have to say, "No thanks. I'll take dollars please."
- etr-strike 9y ago
  Your “real estate” investment is propped up by the federal reserve. You were bailed out at the expense of savers. I’m glad you missed out on bitcoin. It wasn’t made for you.

rifung 9y ago

> But there is also a chance that we genuinely are at the beginning of the transition from Fiat currencies to crypto (beginning of the S-curve mass adoption) I can only speak for myself but I see this chance as practically being 0. As far as I can tell the only people who would need something like Bitcoin are those who participate in illegal/immoral activity. Seeing as there is no regulation, I don't think it's far fetched to believe those who have a large amount of Bitcoin, such as hackers who were paid ransoms in it, would have motivation to try to increase the perceived value of it. Personally I believe that people, especially those who already participate in illegal activity, trying to profit is easy for my mind to grasp and believe than for some technological revolution. I suppose the bias from my personal experiences shows as well given that I haven't met a single person who has purchased Bitcoin for its utility but many who have bought it because "it's going to go UP!!!!!!!!!". I suppose personally I don't want to see people throw their money away, especially because in this case I believe it will benefit scammers, and that's why I have a negative attitude towards it.

MadSudaca 9y ago
The total market cap of all cryptocurrencies is .6 trillion USD. There's dozens of coins with teams and communities trying to make them succeed and provide value. There's a lot of work and creativity involved in providing new technological solutions to overcome the limitations of older cryptocurrencies. I think you should give the cryptoscene another chance and do some research on what's going on. Saying that all this work, money and effort is something that will only benefits scammers is a bit unfair.
- spookthesunset 9y ago
  > Saying that all this work, money and effort is something that will only benefits scammers is a bit unfair It's entirely fair. Bitcoin is a solution in search of a problem. The only "solution" it's solved so far is lining the pockets of the folks at the top of its pyramid. Bitcoin has been around for, what, 9 years now? If it was going to see mainstream adoption, it would have happened a long time ago.

jjeaff 9y ago

>But there is also a chance that we genuinely are at the beginning of the transition from Fiat currencies to crypto Maybe, but the current price is no reflection of that. The current price is based on speculation, not utility. No "maybe" about it.

drcross 9y ago
That's just your opinion. My opinion is that every dollar, euro and yen that stored outside the current financial system is being safely utilised in the bitcoin store of value.

pcarolan 9y ago

Some of us think that burning coal at 250kwh[1] per transaction isn't sustainable. [1]https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/ https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-...

sillysaurus3 9y ago

The primary concern is that if BTC wins, we will all be subservient to an algorithm which no one has any incentive to change. We'll lose all financial controls. Worse, people with massive crypto fortunes can act as evil as they want, and society can't do anything to stop them. Right now we can take the money away from the powerful, if society collectively agrees to. That will become impossible. If BTC had no upper limit, I would agree with you. But Satoshi capped it, and theories abound as to why. The most reasonable explanation is that he wanted to incentivize network strength: more participants, the healthier the network, and deflationary currency encourages adoption from a game theory point of view. But think about the endgame. What do you think will happen when coins stop being minted? When there are only 400 BTC left to mine? What will happen to all those miners and the vast worldwide mining apparatus? If Satoshi were still around, he would likely want to remove the hard cap. And then we'd be in a different situation. But he didn't, so we're not.

jstanley 9y ago
Why would it make any difference if Satoshi were still around? He can't make arbitrary changes to the consensus rules any more easily than anyone else can. And you might not be able to take money away from the powerful, but you can still throw them in prison.
- sillysaurus3 9y ago
  Try throwing Putin into prison. That's the kind of threat model at stake here. Another Putin emerging. And this one may be much less predictable. If Satoshi were around, his opinion would carry weight. He's the spiritual leader and mysterious benefactor, the only person to have ever solved the byzantine generals problem with sybil resistance. If he spoke, people would listen more closely than to others. In fact, people are resisting change mostly because they want to stick to satoshi's original vision. So he is speaking to us, in a way, by saying nothing. That's him communicating his vision to us, and us agreeing with it. If he were still around, he might very well say "I only did that to ensure the network stayed healthy! We still have an endgame to think about! The miners will eventually run out of coins to mine, and it's in our interests to continue the status quo rather than degenerate into that world."

Chathamization 9y ago

There seems to be a ton of excitement about Bitcoin now, not because of what it can do, but almost entirely because of speculation. Almost none of the general public interest in Bitcoin stems from an interest in what Bitcoin is; the vast majority of people simply see it as a get rich quick asset. And the reason why people are only interested in it for speculative reasons is because it doesn't seem to have any particular benefit for most people. And if this is a speculative bubble the way it looks like it is, it will end like other speculative bubbles. A few people will get absurdly rich, not because they added any value to the system, but because they were able to time the market. Their money will come from the many others who will lose a lot because they tried to do the same thing but were too late. Beyond that, there seems to be a small group of people who are interested in it because they see it as an alternative to fiat currency. But strong opposition to fiat currency seems to be one of those odd economic beliefs that some people get, similar to the people who think that our society would be great if we just got rid of money and had a barter system. Outside of fringe beliefs, fiat currency is generally seen as a useful tool.

drcross 9y ago
I'm tired of this perspective. Just because you "feel" people are in bitcoin for "the wrong reason" doesn't make it bad. Similarly if people start buying electric vehicles because they are faster than gas cars it doesn't make them "worse" than people who buy them for environment change. A lot of millenials have learned a lot about the existing financial system due to Bitcoin, even if it was initially to make a quick buck, and I suspect there's no way back to fiat for a lot of them.
- Anderkent 9y ago
  > A lot of millenials have learned a lot about the existing financial system due to Bitcoin, even if it was initially to make a quick buck, and I suspect there's no way back to fiat for a lot of them. This is exactly the kind of one-sided perspective that makes me very sceptical. No, they didn't 'leave fiat' in any way, and they never will. At best they can hedge against it a little. But while that might be personally profitable, it is not clear at all whether it is a net benefit; the main problem of western economies nowadays seems to be too tight monetary policy, and crypto is tighter than fiat.

alexchantavy 9y ago

> Again, this could go the other way and it could all come crashing down soon and maybe the hype dies down. The housing market crashed in 2008 when everyone defaulted on their loans and all the speculation on those assets went upside down. I wonder what a cryptocurrency crash would look like.

gabesullice 9y ago
A blip

matchcohnn 9y ago

Oh yeah one more downside..... There is no one to catch a falling knife. Like right now as we speak

volgo 9y ago

People have listed some good reasons, but no one hit the real painful and unpleasant reason: People are negative about it because they missed the ride up. It was at $1k earlier this year when these people started dissing it and calling it a Ponzi scheme, and now it's at $15k. Those people missed out a 15x gain, something most startups they've labored their life over can't do. It's human nature to be jealous

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ace_of_spades 9y ago

This is what I am actually afraid of! Why would you want to become bitcoin worth even more... when its value is so unevenly distributed towards early adopters? ... when it is using as much power as a medium-sized country while only providing a few transactions per second at a price of $10+? Before you jump on the hype train, just ask yourself if it really is a train you want to get on, consequences and all. Alas I fear lot of people are already too invested in bitcoin as to see the problems with it.

camillomiller 9y ago

Whatever happens, can we fucking stop to shorten them to crypto!? Crypto does not mean cryptocurrency, for God’s sake!!! https://www.schneier.com/blog/archives/2017/12/crypto_is_being.html https://www.schneier.com/blog/archives/2017/12/crypto_is_bei...

occamrazor 9y ago
To be fair, crypto also doesn’t mean cryptography, but in programming circles they are often used as synonyms. Crypto just means hidden.
- camillomiller 9y ago
  Of course, it's from Greek. I'm not saying it should be used to mean cryptography, nobody's claiming that. I'm just saying that throwing it around as a shortened version of cryptocurrency is the most ill-conceived usage you could possibly make of it. Both from an etymological and lexical standpoint.

anonytrary 9y ago

I mean this is crashing now, but at some point it will go back up. Blockchain technology will continue to make people in high places very mad. It's here to stay. Is there a lot of money in it right now for the stage it's in? Absolutely. Blockchains are objectively a better system. If the government pulls a Napster on Bitcoin (and Blockchains), I hope they get whatever is coming to them. Napster -- it had its problems with fairness and ownership, and a reasonable case could be made as to why it hurt creative producers. But Bitcoin/Blockchains? Literally no case can be made as to why we have banks when we have Bitcoin. It helps everyone except the people in charge of the inferior systems. For example, what happened with Slavery? There was a lot of old money in Slavery and at some point we had to be like "sorry guys, your system sucks". Of course, that ended with war. But at the end of the day, we are in a better system. I can proudly say "slavery is disgusting" without fear of being hurt by the government. Today we live in a time of financial slavery. A time where certain people get to control our money and thus our means. When will we be able to say that "banks are disgusting"? I am waiting for that day.

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