6 ms·

Well bitcoin is better for store of value, just use a CC for spending - more protection.

by Cypher 8y ago

godzillabrennus 8y ago
Has your local currency been so awful at storing value that it lost more than 75% of its value in a little over a year? In Venezuela you’re probably better offer with Bitcoin. If you live in a developed free market economy then probably not.
- nybble41 8y ago
  Bitcoin did not lose "more than 75% of its value in a little over a year". You're conveniently picking the peak price during a short-lived bubble as the baseline for your comparison, as if $20k were the normal price. No one with any sense purchased significant amounts of Bitcoin at that price. (Obviously quite a few people did buy at that price—but that's not the point. Buying after a sharp rise in the price is a losing strategy for almost any investment.) I could just as easily draw your attention to the fact that even now Bitcoin has nearly tripled in value (+190%) over the last two years. Right before the run up to $20k Bitcoin was around $6k; now it's at $3700. That's only a loss of 40%, not 75%, if you bought at the pre-bubble price. And it reached $3700 for the first time only about a year and a half ago, in July of 2017. It's hardly the only investment to show no net gain (or loss) over that time period.
theandrewbailey 8y ago
Bitcoin is terrible for storing value.
- jondubois 8y ago
  It's been a great store of value over the past 6 years. It has outperformed every major index and currency. If you had invested just $10K in Bitcoin in May 2013, by July 2013 you would have lost almost half of your money... But if you were smart and had held on to it, today you would have over $350K! As Warren Buffet would say, you just have to buy when everyone else is selling and sell when everyone else is buying. You have to keep your eye on intrinsic value... and the other eye on the Lambo. Easy peasy.
  - theandrewbailey 8y ago
    Stores of value aren't investments.
  - this_user 8y ago
    > It's been a great store of value over the past 6 years. I don't think you understand what "store of value" means. Store of value means little to no volatility. Meanwhile, Bitcoin is one of the most volatile assets in existence. And a real store of value is a store of value permanently not just over a certain period of time.
  - tim333 8y ago
    What Warren Buffett actually said "In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending."
  - isostatic 8y ago
    > You have to keep your eye on intrinsic value $0
onomics 8y ago
Why would you 'store value' in something that's so new and volatile? If you want something impractical that serves to store value, buy Gold.
acdha 8y ago
The only value Bitcoin has is group consensus. If nobody has a need to use it, the values of otherwise-meaningless numbers will trend to zero.
- dnautics 8y ago
  Literally true for every currency at some level. I suppose you could use a greenback as very poor toilet paper.
  - acdha 8y ago
    The part you're leaving out is that most currencies are backed by governments with significant economies and that backing creates a substantial market because you use those currencies to pay your taxes and government workers and contracts are paid using that currency. In contrast, a pure fiat currency like Bitcoin has no inherent value and no built-in demand. If something else becomes popular, there's zero anchor for anyone who doesn't have a substantial holding and the pitch of “you should use this so I get rich” is not generally compelling.
    - dnautics 8y ago
      Why I said "at some level": what are governments backed by?
- jondubois 8y ago
  'Need' is a relative term. If you ask me what I need, I'll say I need a house to live in, air to breathe, water to drink and food to eat. If you ask Mark Zuckerberg what he needs, he'll say "All that can be counted". Mark Zuckerberg has much more money than you or me. So when it comes to valuing things on the open market, his opinion of what 'Need' means matters a lot more.
  - acdha 8y ago
    That doesn't really relate to anything I wrote. My question was that if Bitcoin collapsed tomorrow, who'd notice other than the get-rich-quick crowd? Statistically nobody uses it for daily transactions and almost everyone has other options which are some combination of cheaper, faster, safer, and easier to use. There just isn't a long-term anchor pushing people to use that particular system, certainly not at the level needed to sustain the high infrastructure costs.
jessaustin 8y ago
obvious sarcasm, people.
lenticular 8y ago
That's the latest line since transaction costs of bitcoin have become out of this world. But it's more volatile than any non tin-pot dictatorship currency. It's vulnerable to hacking, hardware failure, or fraud by exchanges. I swear every 2 weeks a hear about another $100 million vanishing. How is this not just an utterly useless technology for anything except illegal transactions?
- nybble41 8y ago
  > That's the latest line since transaction costs of bitcoin have become out of this world. You should update your FUD. The average cost to have your transaction accepted in the next block is currently about 31 cents. If 1-2 hours is acceptable (6 blocks) then you can reduce that to less than a quarter. There was a period when the transaction fees were much higher (because the network was undergoing DOS attacks) but that passed some time ago. Bitcoin is vulnerable to hacking, hardware failure, or fraud by exchanges in much the same way the USD or EUR or any other currency is vulnerable to theft, physical destruction, or fraud by exchanges (or banks)—except that Bitcoin offers ways to protect yourself against theft or hardware failure which are not available for physical currencies, and there is no particular reason to maintain a balance at an exchange. People have no problem accepting that it's unsafe to carry around large amounts of physical currency but won't take simple measures like using a hardware wallet with a PIN to store their private keys. Don't blame the Bitcoin protocol for people failing to take obvious and recommended security precautions. I'll grant that it's more volatile than most other currencies, but that's hardly unexpected for something new and experimental. It's less volatile now than it used to be, though, and that trend is likely to continue.
api 8y ago
It's a terrible store of value. It requires a constant massive electricity expenditure to keep it up. Gold, property, etc. do not and are much better if you just want to park money in something other than a financial instrument.
cwyers 8y ago
The original Bitcoin paper is all about payments: https://bitcoin.org/bitcoin.pdf https://bitcoin.org/bitcoin.pdf If Bitcoin isn't any good for that, it's kind of a failure.

Well bitcoin is better for store of value, just use a CC for spending - more protection.

by Cypher 8y ago

Well bitcoin is better for store of value, just use a CC for spending - more protection.

Has your local currency been so awful at storing value that it lost more than 75% of its value in a little over a year? In Venezuela you’re probably better offer with Bitcoin. If you live in a developed free market economy then probably not.

nybble41 8y ago
Bitcoin did not lose "more than 75% of its value in a little over a year". You're conveniently picking the peak price during a short-lived bubble as the baseline for your comparison, as if $20k were the normal price. No one with any sense purchased significant amounts of Bitcoin at that price. (Obviously quite a few people did buy at that price—but that's not the point. Buying after a sharp rise in the price is a losing strategy for almost any investment.) I could just as easily draw your attention to the fact that even now Bitcoin has nearly tripled in value (+190%) over the last two years. Right before the run up to $20k Bitcoin was around $6k; now it's at $3700. That's only a loss of 40%, not 75%, if you bought at the pre-bubble price. And it reached $3700 for the first time only about a year and a half ago, in July of 2017. It's hardly the only investment to show no net gain (or loss) over that time period.

theandrewbailey 8y ago

Bitcoin is terrible for storing value.

jondubois 8y ago
It's been a great store of value over the past 6 years. It has outperformed every major index and currency. If you had invested just $10K in Bitcoin in May 2013, by July 2013 you would have lost almost half of your money... But if you were smart and had held on to it, today you would have over $350K! As Warren Buffet would say, you just have to buy when everyone else is selling and sell when everyone else is buying. You have to keep your eye on intrinsic value... and the other eye on the Lambo. Easy peasy.
- theandrewbailey 8y ago
  Stores of value aren't investments.
- this_user 8y ago
  > It's been a great store of value over the past 6 years. I don't think you understand what "store of value" means. Store of value means little to no volatility. Meanwhile, Bitcoin is one of the most volatile assets in existence. And a real store of value is a store of value permanently not just over a certain period of time.
- tim333 8y ago
  What Warren Buffett actually said "In terms of cryptocurrencies, generally, I can say with almost certainty that they will come to a bad ending."
- isostatic 8y ago
  > You have to keep your eye on intrinsic value $0

onomics 8y ago

Why would you 'store value' in something that's so new and volatile? If you want something impractical that serves to store value, buy Gold.

acdha 8y ago

The only value Bitcoin has is group consensus. If nobody has a need to use it, the values of otherwise-meaningless numbers will trend to zero.

dnautics 8y ago
Literally true for every currency at some level. I suppose you could use a greenback as very poor toilet paper.
- acdha 8y ago
  The part you're leaving out is that most currencies are backed by governments with significant economies and that backing creates a substantial market because you use those currencies to pay your taxes and government workers and contracts are paid using that currency. In contrast, a pure fiat currency like Bitcoin has no inherent value and no built-in demand. If something else becomes popular, there's zero anchor for anyone who doesn't have a substantial holding and the pitch of “you should use this so I get rich” is not generally compelling.
  - dnautics 8y ago
    Why I said "at some level": what are governments backed by?
jondubois 8y ago
'Need' is a relative term. If you ask me what I need, I'll say I need a house to live in, air to breathe, water to drink and food to eat. If you ask Mark Zuckerberg what he needs, he'll say "All that can be counted". Mark Zuckerberg has much more money than you or me. So when it comes to valuing things on the open market, his opinion of what 'Need' means matters a lot more.
- acdha 8y ago
  That doesn't really relate to anything I wrote. My question was that if Bitcoin collapsed tomorrow, who'd notice other than the get-rich-quick crowd? Statistically nobody uses it for daily transactions and almost everyone has other options which are some combination of cheaper, faster, safer, and easier to use. There just isn't a long-term anchor pushing people to use that particular system, certainly not at the level needed to sustain the high infrastructure costs.

jessaustin 8y ago

obvious sarcasm, people.

lenticular 8y ago

That's the latest line since transaction costs of bitcoin have become out of this world. But it's more volatile than any non tin-pot dictatorship currency. It's vulnerable to hacking, hardware failure, or fraud by exchanges. I swear every 2 weeks a hear about another $100 million vanishing. How is this not just an utterly useless technology for anything except illegal transactions?

nybble41 8y ago
> That's the latest line since transaction costs of bitcoin have become out of this world. You should update your FUD. The average cost to have your transaction accepted in the next block is currently about 31 cents. If 1-2 hours is acceptable (6 blocks) then you can reduce that to less than a quarter. There was a period when the transaction fees were much higher (because the network was undergoing DOS attacks) but that passed some time ago. Bitcoin is vulnerable to hacking, hardware failure, or fraud by exchanges in much the same way the USD or EUR or any other currency is vulnerable to theft, physical destruction, or fraud by exchanges (or banks)—except that Bitcoin offers ways to protect yourself against theft or hardware failure which are not available for physical currencies, and there is no particular reason to maintain a balance at an exchange. People have no problem accepting that it's unsafe to carry around large amounts of physical currency but won't take simple measures like using a hardware wallet with a PIN to store their private keys. Don't blame the Bitcoin protocol for people failing to take obvious and recommended security precautions. I'll grant that it's more volatile than most other currencies, but that's hardly unexpected for something new and experimental. It's less volatile now than it used to be, though, and that trend is likely to continue.

api 8y ago

It's a terrible store of value. It requires a constant massive electricity expenditure to keep it up. Gold, property, etc. do not and are much better if you just want to park money in something other than a financial instrument.

cwyers 8y ago

The original Bitcoin paper is all about payments: https://bitcoin.org/bitcoin.pdf https://bitcoin.org/bitcoin.pdf If Bitcoin isn't any good for that, it's kind of a failure.