4 ms·

Why’s it still so darn expensive then?

by reidjs 8y ago

gargarplex 8y ago
Venture investment in Blockchain went up in 2018. The median deal size increased over $1.0mm and the number of deals is also up. [1] Once the ecosystem of complements matures, Bitcoin's utilization is expected to increase. [2] The price of Bitcoin is driven by speculation that utilization of Bitcoin creates value. [3] [1] https://medium.com/@PanteraCapital/market-update-pantera-blockchain-letter-december-2018-f48ad020f9d6 https://medium.com/@PanteraCapital/market-update-pantera-blo... [2] Crossing the Chasm, 3rd Edition: Marketing and Selling Disruptive Products to Mainstream Customers. Paperback – January 28, 2014 [3] https://www.investopedia.com/articles/investing/091814/what-bitcoins-intrinsic-value.asp https://www.investopedia.com/articles/investing/091814/what-...
- deleted 8y ago
  [deleted]
- verdverm 8y ago
  Private blockchain seems to be crossing the chasm at a much better place. Bitcoin has yet to offer something of value to the mass market. My money is pretty much digital already, and I'm not really down with my transactions being out in the public. Perhaps another crypto currency will meet the needs of the major market, though I have a hunch the current financial institutions will get there first.
  - yellowapple 8y ago
    I think Bitcoin would be a good fit for transferring value between large entities (governments, banks, etc.), where having public accountability would be especially valuable. Those entities could then exchange it with other lower-valued cryptocurrencies, fiat currencies, precious metals, seashells, etc. more suitable for day-to-day consumption by the general public.
    - verdverm 8y ago
      Would you have your transactions out in public view?
      - yellowapple 8y ago
        Not necessarily, but I'm not a government or other large institution :)
- jeron 8y ago
  to add to this, adoption rate for cryptocurrency increased this year as well https://www.investinblockchain.com/cryptocurrency-adoption-rising-in-2018/ https://www.investinblockchain.com/cryptocurrency-adoption-r...
  - verdverm 8y ago
    The stats can be misleading, because I have 3 verified accounts. How many people expanded the number of accounts they hold to access more ICOs / tokens / P&D? BTW, the reference states "The study indicated user growth rates were higher in 2017 but continued on into 2018 at a rapid pace."
NeoBasilisk 8y ago
Because [a rapidly diminishing number of] people still believe that they have value.
kornakiewicz 8y ago
Compared to what?
- criddell 8y ago
  Compared to a transaction at a bank, via PayPal, a credit card, or just about anything. Is there a more expensive (financial and environmental) way to make a transaction?
- moate 8y ago
  Actually useful things. Established currencies. A sack of beans
jboles 8y ago
There’s millions/billions in sunk costs embedded in them, in the form of electricity bills already paid by miners. But being sunk costs, they do not contribute to any intrinsic value on their own.
m3kw9 8y ago
That’s a relative term, is like saying amazon is expensive st 1500 as opposed to 15 after did a 100:1 split. The point is no one knows how to price BitCoins and what to base the price on. At the current price point it could go up or down based on how happy people are with it, almost zero fundamentals to say what is worth.
- geezerjay 8y ago
  > The point is no one knows how to price BitCoins and what to base the price on. That's because bitcoins base price is a very round zero, and the only value associated with them was derived purely from speculation and prescribed prices used in money laundering operations.
WorldMaker 8y ago
By "it" do you mean Bitcoin? Because it is designed to be deflationary? Because its (energy cost) overhead is still sky high and likely to remain reflected in prices? Because it is the "brand name" market with whatever caché remains to that name reflecting in prices? Because sunk costs of existing investors want to keep the price high for as long as possible? Those are just a few of the more obvious reasons. Not that I think it's any one thing here, it's probably some admixture of the above and other reasons.
- belltaco 8y ago
  >Because its (energy cost) overhead is still sky high and likely to remain reflected in prices? This is a huge fallacy.
  - WorldMaker 8y ago
    How is it a fallacy? Do you have a source to cite? I can easily find a few: https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/ https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-... Yes, it's down from the bubble peak in mining, but it is still a massive over-expenditure of energy per value. Right now, still, according to the Digiconomist stats above, ~15 average US homes can be powered for a day with the energy spent to make a single Bitcoin transaction block. That's a considerable amount of energy.
    - belltaco 8y ago
      The fallacy is in the second part of your statement, that it's reflected in the prices. The mining viability follows the price of bitcoin, not the other way around. The mining costs are in no way reflected in the costs of mining.

Why’s it still so darn expensive then?

by reidjs 8y ago

Why’s it still so darn expensive then?

Venture investment in Blockchain went up in 2018. The median deal size increased over $1.0mm and the number of deals is also up. [1] Once the ecosystem of complements matures, Bitcoin's utilization is expected to increase. [2] The price of Bitcoin is driven by speculation that utilization of Bitcoin creates value. [3] [1] https://medium.com/@PanteraCapital/market-update-pantera-blockchain-letter-december-2018-f48ad020f9d6 https://medium.com/@PanteraCapital/market-update-pantera-blo... [2] Crossing the Chasm, 3rd Edition: Marketing and Selling Disruptive Products to Mainstream Customers. Paperback – January 28, 2014 [3] https://www.investopedia.com/articles/investing/091814/what-bitcoins-intrinsic-value.asp https://www.investopedia.com/articles/investing/091814/what-...

deleted 8y ago
[deleted]
verdverm 8y ago
Private blockchain seems to be crossing the chasm at a much better place. Bitcoin has yet to offer something of value to the mass market. My money is pretty much digital already, and I'm not really down with my transactions being out in the public. Perhaps another crypto currency will meet the needs of the major market, though I have a hunch the current financial institutions will get there first.
- yellowapple 8y ago
  I think Bitcoin would be a good fit for transferring value between large entities (governments, banks, etc.), where having public accountability would be especially valuable. Those entities could then exchange it with other lower-valued cryptocurrencies, fiat currencies, precious metals, seashells, etc. more suitable for day-to-day consumption by the general public.
  - verdverm 8y ago
    Would you have your transactions out in public view?
    - yellowapple 8y ago
      Not necessarily, but I'm not a government or other large institution :)
jeron 8y ago
to add to this, adoption rate for cryptocurrency increased this year as well https://www.investinblockchain.com/cryptocurrency-adoption-rising-in-2018/ https://www.investinblockchain.com/cryptocurrency-adoption-r...
- verdverm 8y ago
  The stats can be misleading, because I have 3 verified accounts. How many people expanded the number of accounts they hold to access more ICOs / tokens / P&D? BTW, the reference states "The study indicated user growth rates were higher in 2017 but continued on into 2018 at a rapid pace."

NeoBasilisk 8y ago

Because [a rapidly diminishing number of] people still believe that they have value.

kornakiewicz 8y ago

Compared to what?

criddell 8y ago
Compared to a transaction at a bank, via PayPal, a credit card, or just about anything. Is there a more expensive (financial and environmental) way to make a transaction?
moate 8y ago
Actually useful things. Established currencies. A sack of beans

jboles 8y ago

There’s millions/billions in sunk costs embedded in them, in the form of electricity bills already paid by miners. But being sunk costs, they do not contribute to any intrinsic value on their own.

m3kw9 8y ago

That’s a relative term, is like saying amazon is expensive st 1500 as opposed to 15 after did a 100:1 split. The point is no one knows how to price BitCoins and what to base the price on. At the current price point it could go up or down based on how happy people are with it, almost zero fundamentals to say what is worth.

geezerjay 8y ago
> The point is no one knows how to price BitCoins and what to base the price on. That's because bitcoins base price is a very round zero, and the only value associated with them was derived purely from speculation and prescribed prices used in money laundering operations.

WorldMaker 8y ago

By "it" do you mean Bitcoin? Because it is designed to be deflationary? Because its (energy cost) overhead is still sky high and likely to remain reflected in prices? Because it is the "brand name" market with whatever caché remains to that name reflecting in prices? Because sunk costs of existing investors want to keep the price high for as long as possible? Those are just a few of the more obvious reasons. Not that I think it's any one thing here, it's probably some admixture of the above and other reasons.

belltaco 8y ago
>Because its (energy cost) overhead is still sky high and likely to remain reflected in prices? This is a huge fallacy.
- WorldMaker 8y ago
  How is it a fallacy? Do you have a source to cite? I can easily find a few: https://digiconomist.net/bitcoin-energy-consumption https://digiconomist.net/bitcoin-energy-consumption https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-energy-consumption-explained/ https://arstechnica.com/tech-policy/2017/12/bitcoins-insane-... Yes, it's down from the bubble peak in mining, but it is still a massive over-expenditure of energy per value. Right now, still, according to the Digiconomist stats above, ~15 average US homes can be powered for a day with the energy spent to make a single Bitcoin transaction block. That's a considerable amount of energy.
  - belltaco 8y ago
    The fallacy is in the second part of your statement, that it's reflected in the prices. The mining viability follows the price of bitcoin, not the other way around. The mining costs are in no way reflected in the costs of mining.