5 ms·

Bitcoin averages something on the order of 200,000 transactions per day. It's useful to someone.

by hapnin 8y ago

wpietri 8y ago
That's definitely not proof of real economic utility. How many bets happen in Las Vegas every day? But economically, they're negative-sum events exploiting cognitive weaknesses.
- hapnin 8y ago
  Use as a currency was the point I was addressing. Bitcoin has been a working network for 9 years with 300,000,000 plus transactions. It's a useful currency.
  - simias 8y ago
    300 million transactions in 9 years is ridiculously low compared to any "fiat" currency. Googling around I find a post that gives a lower bound for number of debit card transactions in the USA alone as 47 billions for 2012 alone[1]. That's not counting the rest of the world and the other exchange media like cash or bank transfers. 300 million transactions is nothing. I mean thing about it, it's one single transaction for every person in the USA over the course of 9 years. Alternatively it's less one transaction per year for the entire population of Canada. Amazon alone probably handles more transactions over the course of a couple of weeks. [1] https://www.quora.com/How-many-credit-and-debit-card-transactions-are-there-every-year https://www.quora.com/How-many-credit-and-debit-card-transac...
  - Frondo 8y ago
    I wonder how many minutes it'd take for cash to manage 300 million transactions.
  - wpietri 8y ago
    Gambling has way more transactions. LIBOR options have more transactions. Any actively traded stock has more transactions. None of those things are currency. Even prominent Bitcoin advocates agree it's not effective as a currency: http://avc.com/2017/08/store-of-value-vs-payment-system/ http://avc.com/2017/08/store-of-value-vs-payment-system/
- conanbatt 8y ago
  They are not negative sum, because they provide entertainment. Also, all systems that pay taxes are negative sum as well! Utility is not measured in money.
  - dpq 8y ago
    Entertainment can also have negative value. That's what the parent meant: your entertainment is provided by someone exploiting your gambling-addicted (and gambling may cause an actual addiction afaik, no less so than opioid addiction although based on different biochemistry) dopamine circuitry in order to extract actual (social) value.
    - conanbatt 8y ago
      All entertainment is someone exploiting your chemistry. Thats the whole point.
  - wpietri 8y ago
    They mainly provide addiction. Go to a casino sometime and look around. Do those people look like they're entertained? The slot machine zombies barely look human anymore. You're also wrong about taxes. Consider my local taqueria. They buy raw materials and create value by making ready-to-eat food just when people are hungry. They receive cash in exchange, a portion of which they pay in taxes to fund the infrastructure their business depends upon. That is positive sum for all participants. It has to be. If taxes tipped it into the negative sum category, they'd eventually close down.
    - conanbatt 8y ago
      I dont think you've followed through on that model of yours. If you buy 50 dollars of taco materials, then taco materials seller makes likes than 50 dollars ,because the state will charge a tax on him. If he didnt sell 50 dollars worth of raw materials, he would have 50 dollars of raw materials to consume, instead of less than 50 dollars. On the other side, making the taco, you have the same issue: if you sell 100 dollars of tacos, and someone pays you 100 dollars for them, you then pay taxes. You earn less than 100 dollars, and someone else lost 100 dollars. Repeat the proces ad-infinitum and your holdings go to 0.
- JackFr 8y ago
  Not (necessarily) true. Expected value is not the only thing to consider. Higher moments matter. Insurance typically has negative expected value but it’s rational to buy it (in conjunction with owning the insured object) to reduce one’s variance. Gambling will increase the variance of one’s portfolio at the cost of expected value, which can be rational depending on one’s situation.
  - notahacker 8y ago
    An awful lot of casino gambling involves series of small stakes bets on low payout options which don't even meaningfully increase upside portfolio variance over time after the house edge has been taken out. Might still be rational from a utilitarian perspective if one really, really enjoys card games of course, but not from a portfolio allocation perspective. Apart from weird edge cases where an actor needs to double their money overnight to return to solvency in order to have a chance of benefiting from an income stream in future, there aren't many cases where it makes sense from a portfolio allocation basis given the existence of non-negative expectation bets in other markets with a wide range of possible variances. The insurance and investment management industries are built on the principle that economic rationality works in exactly the opposite way to gambling: that inherent value exists in reducing risk.
    - wpietri 8y ago
      Exactly. Thank you.
baq 8y ago
Visa does 2000 per second. 200k per day is almost laughable.
sudomake 8y ago
And Visa can do 7x that in a minute

Bitcoin averages something on the order of 200,000 transactions per day. It's useful to someone.

by hapnin 8y ago

Bitcoin averages something on the order of 200,000 transactions per day. It's useful to someone.

That's definitely not proof of real economic utility. How many bets happen in Las Vegas every day? But economically, they're negative-sum events exploiting cognitive weaknesses.

hapnin 8y ago
Use as a currency was the point I was addressing. Bitcoin has been a working network for 9 years with 300,000,000 plus transactions. It's a useful currency.
- simias 8y ago
  300 million transactions in 9 years is ridiculously low compared to any "fiat" currency. Googling around I find a post that gives a lower bound for number of debit card transactions in the USA alone as 47 billions for 2012 alone[1]. That's not counting the rest of the world and the other exchange media like cash or bank transfers. 300 million transactions is nothing. I mean thing about it, it's one single transaction for every person in the USA over the course of 9 years. Alternatively it's less one transaction per year for the entire population of Canada. Amazon alone probably handles more transactions over the course of a couple of weeks. [1] https://www.quora.com/How-many-credit-and-debit-card-transactions-are-there-every-year https://www.quora.com/How-many-credit-and-debit-card-transac...
- Frondo 8y ago
  I wonder how many minutes it'd take for cash to manage 300 million transactions.
- wpietri 8y ago
  Gambling has way more transactions. LIBOR options have more transactions. Any actively traded stock has more transactions. None of those things are currency. Even prominent Bitcoin advocates agree it's not effective as a currency: http://avc.com/2017/08/store-of-value-vs-payment-system/ http://avc.com/2017/08/store-of-value-vs-payment-system/
conanbatt 8y ago
They are not negative sum, because they provide entertainment. Also, all systems that pay taxes are negative sum as well! Utility is not measured in money.
- dpq 8y ago
  Entertainment can also have negative value. That's what the parent meant: your entertainment is provided by someone exploiting your gambling-addicted (and gambling may cause an actual addiction afaik, no less so than opioid addiction although based on different biochemistry) dopamine circuitry in order to extract actual (social) value.
  - conanbatt 8y ago
    All entertainment is someone exploiting your chemistry. Thats the whole point.
- wpietri 8y ago
  They mainly provide addiction. Go to a casino sometime and look around. Do those people look like they're entertained? The slot machine zombies barely look human anymore. You're also wrong about taxes. Consider my local taqueria. They buy raw materials and create value by making ready-to-eat food just when people are hungry. They receive cash in exchange, a portion of which they pay in taxes to fund the infrastructure their business depends upon. That is positive sum for all participants. It has to be. If taxes tipped it into the negative sum category, they'd eventually close down.
  - conanbatt 8y ago
    I dont think you've followed through on that model of yours. If you buy 50 dollars of taco materials, then taco materials seller makes likes than 50 dollars ,because the state will charge a tax on him. If he didnt sell 50 dollars worth of raw materials, he would have 50 dollars of raw materials to consume, instead of less than 50 dollars. On the other side, making the taco, you have the same issue: if you sell 100 dollars of tacos, and someone pays you 100 dollars for them, you then pay taxes. You earn less than 100 dollars, and someone else lost 100 dollars. Repeat the proces ad-infinitum and your holdings go to 0.
JackFr 8y ago
Not (necessarily) true. Expected value is not the only thing to consider. Higher moments matter. Insurance typically has negative expected value but it’s rational to buy it (in conjunction with owning the insured object) to reduce one’s variance. Gambling will increase the variance of one’s portfolio at the cost of expected value, which can be rational depending on one’s situation.
- notahacker 8y ago
  An awful lot of casino gambling involves series of small stakes bets on low payout options which don't even meaningfully increase upside portfolio variance over time after the house edge has been taken out. Might still be rational from a utilitarian perspective if one really, really enjoys card games of course, but not from a portfolio allocation perspective. Apart from weird edge cases where an actor needs to double their money overnight to return to solvency in order to have a chance of benefiting from an income stream in future, there aren't many cases where it makes sense from a portfolio allocation basis given the existence of non-negative expectation bets in other markets with a wide range of possible variances. The insurance and investment management industries are built on the principle that economic rationality works in exactly the opposite way to gambling: that inherent value exists in reducing risk.
  - wpietri 8y ago
    Exactly. Thank you.

baq 8y ago

Visa does 2000 per second. 200k per day is almost laughable.

sudomake 8y ago

And Visa can do 7x that in a minute