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Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. It feels like this is wher

Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. It feels like this is where all the "how to get rich quick" book writers and other hustle bros went and created one giant financial pyramid, which works in quite simple way: - buy bitcoin - tell everyone around how revolutionary it is, so they buy it and what you holding increases in value, then tell them to do the same. Keep repeating the above two steps through different layers of abstraction, so it's not so obvious anymore. The other thing that comes into play and makes it grow even bigger is when people see others who made money on this bunch of bollocks, and think that the fact they are rich somehow makes them smart. Then they buy into all of the cryptocurrency platitudes wholesale without stopping for a moment to critically evaluate it. I think I'm a bit sour, because this whole crypto-crap infested the idea space of decentralisation, which is imho very important step that we should try to take take as a society. Now it's just forever tainted with bitcoin and all the greed fuelled people there, while the decentralisation should be quite the opposite in nature. You know what would be revolutionary? Getting rid of currency altogether.

I_am_tiberius 6y ago
I don't understand such kind of comments. Let's talk again after you experienced a bank cancelling your business account for no reason with seemingly having landed on a shared hidden blacklist that makes it impossible to get a new bank account.
- robjan 6y ago
  Has bitcoin actually solved that problem though?
  - vntok 6y ago
    Yes it has, anyone in the world can open their own "current account"/"deposit account" for free, right now. Barring hacking you, no government or authority can access it without your consent. None can prevent you from receiving money in it from someone else, or from transferring money out of it to someone else.
    - robjan 6y ago
      I can receive bitcoins but I cant buy food with bitcoins or pay my staff with bitcoins. At some point I need to convert these coins to fiat and that's subject to the same controls that GP noted.
      - chill1 6y ago
        Are you sure you can't spend Bitcoin directly for goods and services? Have you tried? When was the last time you searched for physical shops near you [1] that accept it? [1] https://coinmap.org/ https://coinmap.org/
        twox2 6y ago
        The fees are too high and at least in the US, every transaction is taxable.
        chill1 6y ago
        No one should be using on-chain Bitcoin transactions for in-person exchange. Partly due to the high fees, but mostly because of double-spending and lack of privacy. Lightning Network solves all of these problems. Fees are much lower, settlement is instant and clear to even unsophisticated users, and the recipient cannot see from where the funds originated. Taxes are a different issue and that's up to each jurisdiction to solve via better legislation.
        twox2 6y ago
        Don't you still have to pay the tx fee to open a lightning network channel? Anyway the whole thing lost me with the block size debate (always been a big blocker). Where are we at with lightning network adoption anyway?
        chill1 6y ago
        Yes, an on-chain transaction is required to open a channel. But once open you can continue to use it forever, or until you (or your counter-party) decide to close it. Lightning Network adoption is slow and steady. There are several newbie-friendly mobile wallet apps available [1][2][3]. Some nice improvements have been developed and pushed live in the last 18 months (e.g watchtowers [4] and atomic multi-path payments (AMP) [5]). There are now five Lightning Network node implementations (lnd, eclair, c-lightning, rust lightning, Electrum). And there are hardware projects working to bring LN into the physical space - one of which is my own project, a Lightning-only Bitcoin ATM named "Bleskomat" [6]. [1] https://phoenix.acinq.co/ https://phoenix.acinq.co/ [2] https://www.walletofsatoshi.com/ https://www.walletofsatoshi.com/ (!!) <-- custodial [3] https://breez.technology/ https://breez.technology/ [4] https://github.com/lnbook/lnbook/blob/8d2582e51eb615c850b24e83d41d9f5b673cd45e/node_operations.asciidoc#watchtowers https://github.com/lnbook/lnbook/blob/8d2582e51eb615c850b24e... [5] https://lists.linuxfoundation.org/pipermail/lightning-dev/2018-February/000993.html https://lists.linuxfoundation.org/pipermail/lightning-dev/20... [6] https://www.bleskomat.com/ https://www.bleskomat.com/
sixQuarks 6y ago
Initially it was meant to be used as currency, but it's become more of an asset class now, mainly used as a store of value, similar to gold. Do you know how difficult it is to get millions of people to agree that something is a store of value, not only agree, but to put their money where their mouth is? THIS is why bitcoin is where it's at.
- eli 6y ago
  At least you can build useful things out of gold
  - charcircuit 6y ago
    and you can build useful things using cryptocurrency via smart contracts.
    - MrMan 6y ago
      I think smart contracts with dollars would be just as good
      - charcircuit 6y ago
        I'm not sure what you mean. You can't program the dollar bill. It's a piece of paper. If you are asking why stable coins pegged to the dollar don't exist, well they already exist.
      - tinco 6y ago
        You can build smart contracts with dollars through the Ethereum cryptocurrency. If you think you can make smart contracts any other way then you don't really understand what smart contracts are.
    - eli 6y ago
      can you, though?
      - 6y ago
ianhawes 6y ago
Bitcoin has revolutionized the black market economy.
- bitxbitxbitcoin 6y ago
  Bitcoin has definitely done that but more importantly it has revolutionized the Shadow Economy - which is a lot larger than most people realize.
  - hfsp 6y ago
    The USD remains the choice of the cartels and professional money launderers. After all, pro crooks do not want to leave an eternal trace of their transactions on a public ledger on the internet.
    - bushbaba 6y ago
      Disagree. There’s a reason terrorists such-as hamas, al queda, isis choose to use btc. https://www.coindesk.com/us-prosecutors-attempt-to-seize-bitcoin-allegedly-tied-to-al-qaeda https://www.coindesk.com/us-prosecutors-attempt-to-seize-bit...
    - SEJeff 6y ago
      This so much ^ The FBI has already proven pretty well that with a big enough dragnet (and resource that places like the NSA absolutely have), they can associate people to wallet addresses. It just takes slipping up a single time and they'll find you.
      - jackTheMan 6y ago
        If it is the interest of FBI, also according to this article, in some places an email address is enough to open an account: https://www.bnnbloomberg.ca/booming-crypto-market-a-potential-haven-for-money-laundering-1.1502161 https://www.bnnbloomberg.ca/booming-crypto-market-a-potentia... so not sure about the claim.
daraosn 6y ago
> You know what would be revolutionary? Getting rid of currency altogether. What would be the point, going back to trading? You are missing the point, if you keep a good scarce versus another abundant, overtime the scarce good will gain value. It's basic economics. Bitcoin is revolutionary because of the blockchain, but it's not its fault that it's gaining value, it's people over-hyping it every 4 years due to the halvening plus indiscriminate fiat money printing policy.
bhupy 6y ago
I'm still forming an opinion on cryptocurrency. You mention that decentralization is a very important step that we should try to take as a society. If that's the case, then why isn't Bitcoin (or PeerCoin etc etc) a step function revolution?
- rzodkiew 6y ago
  Because they are not really decentralised. Vast amounts of cryptocurrencies as they are designed right now are disproportionately held by the early adopters, who will inevitably engage in rent seeking in one way or another (I wish I was wrong on this one). Decentralisation has to happen through increasing trust between people, while cryptocurrencies are designed to replace trust. Yeah, current institutions controlling our monies are hardly worth the trust, but honestly bitcoin doesn't even remove that trust (it just shifts it to some random self-proclaimed experts at Tether, twitter gurus or god knows what else the crypto people are up to nowadays).
  - bhupy 6y ago
    I think everything you said is correct about Bitcoin, but is that true of cryptocurrency in general? I think Bitcoin, which has its obvious flaws, is sort of the de facto flag-bearer of crypto, and more of a harbinger of things to come. I'm not yet convinced that Bitcoin will be the only cryptocurrency in widespread use, in the same way that the USD isn't the only fiat currency used in the world today.
    - rzodkiew 6y ago
      I would like to see some sort of cryptocurrency to be successful, just to satisfy my inner nerd, but I'm afraid most of its problems might not be technical in nature. Cryptocurrencies have potential to drastically change how recognition of value is created and distributed, so that's definitely an avenue to explore. Most of the big cryptos that are out there today don't really try to explore that, and currency is something external to value generation and recognition. I'd argue that even fiat currencies are actually closer to the value generation (as the money creation happens when banks give out loans, which at least are supposed to make world better). Purely from cryptocurrency perspective the only thing that it values is keeping the ledger alive. Exactly those self-sustaining by all means mechanisms are what leads to rot in many areas of life (academia, politics, corporations, you name it).
mrb 6y ago
«they buy it and what you holding increases in value, then tell them to do the same.» Literally the same happens to any investment: tell people to buy stock X, time share Y, precious metal Z, that it's awesome, so it gains value, etc The fact is Bitcoin/crypto is revolutionary. For example it allows merchants to cut down on fraud, since a payment received in BTC is irreversible, so chargeback fraud is impossible. It enables instantaneous B2B international payments. It allows escaping your country inflationary currency. It's censorship-resistant. It empowers the unbanked & underbanked.
- chopin 6y ago
  It one-sidedly favors the merchant, though.
JohnJamesRambo 6y ago
“The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” -Satoshi Nakamoto Feb. 2009 If this isn’t resonating with you after the past year, I don’t know. I was forced to watch my government bungle a pandemic in the worst possible way and then asked to pay for it for decades. No I don’t think I will. Bitcoin is a way for me to step outside that debt I did not want or deserve. https://fred.stlouisfed.org/series/M1 https://fred.stlouisfed.org/series/M1
- neilwilson 6y ago
  " Bitcoin is a way for me to step outside that debt I did not want or deserve" Try paying your taxes in Bitcoin. Then you'll find that it has nothing to do with trust and everything to do with avoiding having your assets stripped by the IRS. You want to live in a jurisdiction, then you pony up the tokens that jurisdiction demands. Or you lose your liberty and everything you own.
  - sygma 6y ago
    > At the city level, [Miami mayor] Suarez’s ambitions are equally ambitious. He’s “looking at” ways to pay municipal employees a percentage of their salary in bitcoin and allow residents to use bitcoin and other cryptocurrencies for “payments and fees,” including taxes. https://www.coindesk.com/miami-mayor-previews-favorable-crypto-policy https://www.coindesk.com/miami-mayor-previews-favorable-cryp...
    - mywittyname 6y ago
      I bet people still earn $50,000 a year and pay $1,500 a year in property taxes; not 1.2 btc or whatever.
      - FabHK 6y ago
        Exactly. As long as things are still denominated in fiat (and they are...), payment with BTC is just a gimmick.
patricius 6y ago
There are practical reasons that getting rid of currency - or money I assume you mean - is a bad idea. It would be much more difficult to exchange goods and services if we had to barter for instance. But perhaps you have some alternative in mind that I haven't thought of.
- rzodkiew 6y ago
  I do believe that there are some solutions that we could (and will) come up with, but they do require radical shift of priorities in people's lives. Currently our society is just blinded by "chase money by all means" which was always a part of the humanity, but definitely got worse since Commercial Revolution, then even pushed further by Industrial Revolution. At the same time I feel like the pushback is finally slowly showing up in many parts of the society. I wholeheartedly agree that we definitely do need some vehicle of value, and it might as well be currencies as we know them now, but with some hoarding-prevention mechanisms built in, or maybe some other way to figure out a value of time you provide to the society. Right now we rely on free market for that, but is the coffee you buy in the morning of same value to you as it is to the person in the queue after you? And if that coffee helps you build more value to society than your fellow man for whatever the reason, maybe part of that difference could also be captured by the coffee producer as well. If price of coffee was expressed in something like a fractional unit of your value in a day, let's say 0.02u, then you'd pay the same price, yet with wildly different absolute values. This is just random thought, and it probably will fail in hundreds of ways, but maybe something to spark your imagination.
- fabianhjr 6y ago
  > It would be much more difficult to exchange goods and services if we had to barter for instance. But perhaps you have some alternative in mind that I haven't thought of. There has been very few research and development into decentralized economic planning. (Imagine if only a fraction of the development resources that have gone into High Frequency and Momentum Trading had been invested into Decentralized Economic Planning) https://www.wikiwand.com/en/Planned_economy#/Decentralized_planning https://www.wikiwand.com/en/Planned_economy#/Decentralized_p... I am quite sure many here would agree that the Economic Calculation Problem doesn't hold much water nowadays (or at least won't in the near future) with the available computation power. https://www.wikiwand.com/en/Economic_calculation_problem https://www.wikiwand.com/en/Economic_calculation_problem
asenna 6y ago
> Then they buy into all of the cryptocurrency platitudes wholesale without stopping for a moment to critically evaluate it. Go ahead then, I would genuinely like to hear your critical evaluation since you just shit all over the Bitcoin whitepaper without any actual critique in your post. I don't understand the extreme polarization of Bitcoin on HN. It's a very interesting tech and it's still early in the adoption phase and the space is still evolving.
CapmCrackaWaka 6y ago
> You know what would be revolutionary? Getting rid of currency altogether. I would like to see your plans for this ;) Jokes aside, I think that Bitcoin attracting greedy people was inevitable. Bitcoin _was_ revolutionary in that it was a new financial instrument. Couple that with its explosion in value, and the 'hustle bros' will definitely come flocking trying to take advantage. However, if you were a part of it before it became popular, you would definitely know that it started as an oddity, a hobby for cryptographic enthusiasts. The hustle bros didn't write the protocol or sit around scheming about how to design this thing so they can scam people. It doesn't necessarily mean that Bitcoin is inherently bad, but its nature (decentralized, anonymous payments, complex, end users mostly don't understand the details) makes it ripe for the scams you mentioned.
bronak1 6y ago
Society has had multiple stores of value, as none is perfectly secure. Gold, oil, dollars, real estate, (some) bonds & equities. Crypto is the first that’s decentralized and digital and on a open network not governed by any centralized entity which is powerful bc the world needs a international reserve currency
- MrMan 6y ago
  I don't want to rely on a currency which is managed and beholden to an unelected cartel of corporations. I prefer representative government by elected officials.
  - capableweb 6y ago
    > I don't want to rely on a currency which is managed and beholden to an unelected cartel of corporations. Great, don't think we have any currencies that are run by a cartel of corporations (yet), although Facebook's currency was probably gonna end up being that. For cryptocurrencies, they are usually run by "miners" who can be anyone, not just corporations. You can run your own miner, or your own node, hence they are called decentralized. This feature does not exist in our current centralized currencies, and is one of the main selling point of cryptocurrencies. > I prefer representative government by elected officials. That is great that you feel that you are represented correctly in your government, I am really happy for you. For many other people in the world though, that does not exist or if it does, doesn't work out in practice and people don't feel represented. You don't have to look very far to discover which countries I'm referring to. For people living in these countries, where they don't trust the central bank (like many don't trust the central bank in the US to have people's best interest at heart), cryptocurrencies offer a way out of the system without going off-grid and leaving the option of having things to trade with, without going back to a goods barter ecosystem.
    - SV_BubbleTime 6y ago
      Good points, but he’s still right. For all the talk of Bitcoin being decentralized there are a dozen people or so that could destroy the whole system if they so chose to. Overtly or covertly. Despite my feelings about governments specific actions, and the bank system, not even the President or the Fed or Congress could do that as quickly with the dollar.... although sometimes you would think they are trying.
andreygrehov 6y ago
> by replacing currency with a worse kind of currency. The reason why Bitcoin is a mystery for many people is exactly because of this ^. Bitcoin is NOT a currency. It doesn't position itself as a currency. This fairytale is long gone, forget about it. Bitcoin is a store of value. It cost $7.6M and took five years to repatriate 53,780 gold bars worth $27B back from the US to Germany. It's >1000X faster and >10X cheaper to move that much in Bitcoin , even accounting for N>>6 confirmations.
- kgwgk 6y ago
  > It doesn't position itself as a currency. This fairytale is long gone, forget about it. Bitcoin doesn’t position itself as anything. In other comments, though, you can see people are still defending its usefulness as currency. Your example is a bit strange, by the way. Transatlantic bank transfers in your currency of choice have been a solved problem for decades.
  - andreygrehov 6y ago
    I'm talking about transferring bars of gold, which is not the same as a digital transfer.
    - kgwgk 6y ago
      So bitcoin, despite being more volatile than gold, is a better store of value because it can be transferred more easily? Ok then. It can also be stolen or lost more easily, though.
      - andreygrehov 6y ago
        There is always going to be "It can also...". I can say that a friend of yours can come to your place and steal a golden ring from your desk. The volatility concern will eventually go away. Volatility represents people's opinion about Bitcoin. They don't understand it yet. If you look into history, you'll notice that pretty much every new invention goes through this phase. People's first reaction is always the same - "nobody needs it, nobody's going to ever use it".
me551ah 6y ago
I don't get why bitcoin is worth so much.Bitcoin is called a store of value like gold, but gold has inherent uses. If the price of gold went to zero then you could still use it to make jewellery or use it for electrical conductivity. If the price of bitcoin goes to zero then it's worthless. It's also not environmentally friendly and bitcoin mining uses up 0.21% of the world's power supply. And all of this energy is used to calculate billions of hashes per second out of which all but one will be discarded. There is also increased regulatory focus from governments who see it as a threat , with India even going so far as to suggest they would ban it.
- capableweb 6y ago
  Literally mining gold is also not very environmentally friendly and uses a lot of power, probably not as much as Bitcoin though. And Bitcoin will always remain what it is now, a system for transferring bits in a decentralized fashion over the internet. Even if Bitcoin is worth $0, as long as there is a sender and a receiver (and at least one miner online), you'll be able to transact Bitcoin, this is hardly worthless. > governments who see it as a threat , with India even going so far as to suggest they would ban it This for me is a huge selling point for Bitcoin (et al). If famously shady governments like India and the US starts talking about banning something, I immediately start looking into why and how they are banning it. So far, the arguments seems to be that they are scared of loosing control, and if it gotten that far, it's because they genuinely believe cryptocurrencies could replace their centralized currencies. More reason to get involved in it.
  - me551ah 6y ago
    Gold is unique, few metals can match it's shine and electrical conductivity. But there exist many cryptocurrencies which can act as "a system for transferring bits in a decentralized fashion over the internet". Many also do a far better job than bitcoin. So shouldn't they be more valuable than bitcoin? Etherium, Monero etc Yes, but you really can't fight the government and run a parallel currency. If the government bans it then you cannot use it for any legal transactions.
    - 6y ago
ctdonath 6y ago
Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. “Bad money drives out good.” Best money is a compact, moderate/high value, easily verified, inherently useful/desirable, fungible, divisible/mergeable, stable material of a generally agreed on value. Worse money scrapes away these factors as a matter of convenience & opportunism. We’re now reduced to verbal anonymous confirmation that user X is agreed owner of number B, with a market value of V - there is no physical manifestation.
INTPenis 6y ago
Let me demystify it for you. It's used for drugs. That's how I view it. A very small minority of die hards are trying to use it for other things, donations of course, but it's mostly used for drugs. There's a "paper" on pnas claiming the opposite but if you actually read it they make massive assumptions in it. I can't believe they were allowed to publish a paper based on assumptions.
- GreenHeuristics 6y ago
  The story is literally about Tesla buying 1.5B usd worth of it. Sure Elon has some interests in the direction but I doubt Tesla is going to use the bought Bitcoin for drugs.
  - INTPenis 6y ago
    Ok, so besides Teslas investment of 1.5B USD, what do you think bitcoin is used for?
    - olah_1 6y ago
      > what do you think bitcoin is used for? Storing value. Smart ass answer, I know. But it's true. As a private currency, Bitcoin is like a screen door. So I don't know why you'd use it for illegal activities.
      - INTPenis 6y ago
        Ok good point but I was thinking of daily use. Storing value is not daily use, it's just laying there. Just look at the stories of darkweb markets they take down. Thousands of sellers, catering to tens or hundreds of thousands of buyers. There is no other market anywhere in the world using cryptocurrency to that extent.
        rspeele 6y ago
        Don't forget ransomware, crypto's killer app.
amelius 6y ago
Wouldn't the same apply to gold?
ctdonath 6y ago
You know what would be revolutionary? Getting rid of currency altogether. So long as we still exist in a scarcity reality (not the utopian post-scarcity vision), there must a way to abstractly represent the value one possesses and may trade for goods/services.
pontifier 6y ago
>You know what would be revolutionary? Getting rid of currency altogether. I agree. The future is not keeping track. If someone needs something they should have it. The only reason that hasn't happened is scarcity and logistics, which I believe we will solve in the not so distant future.
- forgot_account 6y ago
  >>>If someone needs something they should have it. What mechanism will exist to validate conflicting "needs" of different people in the not-so-distant future? Extreme example: we can't give everyone their own mansion with a beachfront view in order to prevent triggering them.
- mac01021 6y ago
  The problem is that people need so little and that 98% of commerce consists of people transacting for something more than the bare minimum of staying alive.
mrb 6y ago
While away on vacation, I once sent $1000 in cold hard cash, on a Sunday, to an unbanked person in Los Angeles, in less than 1 hour, thanks to bitcoin and the recipient withdrawing it for cash at a Bitcoin ATM. There is not a single alternative service in the world that would have made this possible. If people thought a little beyond their personal use cases, they would understand the utility of Bitcoin/crypto for many others. The technology is a paradigm shift. The financial world is structured as it is because of its existing flaws. Bitcoin/crypto enables things that people don't know they need because they are now possible.
- bl557 6y ago
  https://twitter.com/gladstein/status/1357757736394444800 https://twitter.com/gladstein/status/1357757736394444800
- bryanlarsen 6y ago
  Western Union has been doing this for > 150 years.
  - cassianoleal 6y ago
    I don't know where you are but in a lot of places to use Western Union you have to physically go to one of their stores. With BTC I can buy them via the internet, and the person on the other side can also convert to cash in their own account via the internet, then withdraw on any ATM. It's worlds apart. Edit: I guess if you only consider the parent's use-case where the other person went to a Bitcoin ATM it's not that different but my point stands as it's only 1 other layer in the process and it's an online one.
    - macspoofing 6y ago
      For now. Cryptocurrency is still in the 'honeymoon' phase where it hasn't been fully targeted by governments and regulatory bodies. That will change soon enough. You can't skirt AML regulations forever.
newacct583 6y ago
> buy bitcoin - tell everyone around how revolutionary it is, so they buy it and what you holding increases in value, then tell them to do the same. That's actually not what's happening. Bitcoin got big because Tax Evasion. Or not literal tax evasion maybe, but attempts by wealthy chinese citizens to sequester their finances in a place it can't be seized by their government, which is largely the same thing. Add to that the expected rush of genuine criminal activity, and that's why crypto got big. The libertarian philosophy stuff and pyramid nonsense is a sideshow. Bitcoin is about enabling crime (even, again, where that crime seems "justified" to western eyes).
bl557 6y ago
Some of my favorite "Intro to Bitcoin" pieces - "Bitcoin For The Open Minded Skeptic" - https://www.paradigm.xyz/Bitcoin_For_The_Open_Minded_Skeptic.pdf https://www.paradigm.xyz/Bitcoin_For_The_Open_Minded_Skeptic... "Stone Ridge 2020 Shareholder Letter" - https://www.microstrategy.com/content/dam/website-assets/collateral/bitcoin-downloads/Stone-Ridge-2020-Shareholder-Letter.pdf https://www.microstrategy.com/content/dam/website-assets/col...
JeremyNT 6y ago
Bitcoin and similar cryptocurrencies solve some real problems that most people don't actually have - they allow for verifiable electronic transactions without having to trust any single entity in the chain. The problem Bitcoin and other cryptos actually solves for most people is different. That problem is summarized as "I have (or can borrow, at a low rate) fiat currency, and want to get a much higher return on my investment than the low rates traditional savings provide." Money is cheap right now, and essentially, the returns on these things beat inflation and stock markets. For now. But one of these days the market will collapse - you just have to make sure you get out before that happens.
- GizmoSwan 6y ago
  Yes but once they are used for tax evasion and underground economy they can become worthless in hands of people that deal with it as a legal asset. Governments can regulate any asset class.
_alex_ 6y ago
the key technical innovation that bitcoin gave us (that ethereum and other systems took to the next level) is a replicated state machine shared by untrusted peers. That's a huge deal for decentralized systems. It turns out that economics is a good way to keep network participants honest.
narcissismo 6y ago
Large numbers of the 'get rich quick' crowd that you speak of become poor after each crash. More will follow. Each time this happens, I stand in awe of the brilliance of bitcoin - not so much the details of UTXOs or hash magic, but the choice of time base and halving intervals. Its as if it were designed to be a FOMO feedback loop from the outset. The fact that its still working after so many boom/bust cycles is amazing. [Edit] clarify reference to parent
- oleganza 6y ago
  I think halvings-driving-fomo is a myth. Each halving is possibly a catalyst for the crowds-waiting-to-jump-in, but not the reason for them occuring in the first place. Even without halvings, there would be speculative bubbles, then they'd pop, and the bubble attracted attention and people would start forming a line, but not buying until price begins to confidently move upwards. Since there's little actual utility in using bitcoin right away (even if it was accepted everywhere, but you have fiat, why would you need to buy btc and immediately sell it?), people who'd like to invest would never rush buying until price stabilizes and begins growing. This naturally produces these "steps": BTC goes up 5-10x, then mania kicks in, then it goes 2-3x higher and then pops 2-3x down. Every convinced investor bought before the mania phase, weak hands sold off at a moderate return or at a loss, while a bunch of new people got interested. Halvings are just one of those points that help tipping off the balance for the already formed crowd.
panarky 6y ago
> this whole crypto-crap infested the idea space of decentralisation Then we learned that there are enough bad actors to ruin most decentralized applications before they get big enough to make a difference. Unless the incentives are strong enough. Tokenomics has proven to be a pretty effective way to do that.
cloudhead 6y ago
Curious to know what would invalidate your current belief? It seems like half a trillion dollars in economic value is not convincing enough. So what is?
agloeregrets 6y ago
I feel like a good modern way to explain Bitcoin is to say it's like the gamestock drama from two weeks ago, except the people who have bitcoin are playing both r/wallstreetbets AND the hedge funds. Just inflating the price of something hat doesn't make sense at all to inflate without volume. The value is made up and the economics (and lack of eco-validity) don't matter! Eth's new developments may fix this but 99% less is still a lot without investment. A more fun way to frame this story is 'Self-aggrandizing Green-tech company admits to supporting use of payment processor that uses more than 1000X more power than other options'
washedup 6y ago
"Getting rid of currency altogether" - please explain this nonsense
- CountDrewku 6y ago
  Dude thinks we're gonna live in some Star Trek utopia where one needs money anymore because everything is provided and we all work just for the personal pleasure of discovering new things. Except.... they never explain how they got to that "utopia" in Star Trek and there's a good reason ha ha.
goseeastarwar 6y ago
The mental gymnastics people will play to behave like Bitcoin is anything but a FOMO ponzi scheme is extremely entertaining. They’ll proselytize this fancy new currency that'll eliminate central banking and revolutionize money transfer, while also slipping in the price they bought in at.
dr-detroit 6y ago
Literally every play Musk makes is for subsidies or tax dodge file this one under tax dodge.
nineplay 6y ago
I tried, I sincerely did. I had many friends who were strong believers in bitcoin. I read articles, I watched videos, and every time it felt like hucksterism. There was no serious discussion of the advantages of bitcoin, no attempt to explain blockchain. There was a lot of repeating, over and over again, how amazing and revolutionary bitcoin was. "For the first time ever, a computer owns currency!" one youtuber said without the slightest effort to explain why I should care. Maybe I missed something. Obviously some people did well on it, and if I'd just skipped all those videos, bought a few hundred dollars worth, and then sold those shares a few years later I'd be a lot better off right now.
- helen___keller 6y ago
  > "For the first time ever, a computer owns currency!" one youtuber said without the slightest effort to explain why I should care. The truth is for most people, there's no reason to care. Maybe there will be in the future, but not yet. Most people aren't looking for an investment vehicle, a replacement for USD, a way to challenge central banks, or a way to perform zero-trust financial transactions. Most people want to do what they already do in day-to-day life but with less overhead costs or more ease of use. Bitcoin does nothing for this: on-chain transaction fees are too high, lightning network is not there yet, very few places offer support for btc payments, and so on. All these problems add up to a simple conclusion that btc is not useful for the average person, so instead proponents have to sell a majestic vision of the future or a get-rich-quick scheme. Most go for the latter.
  - nineplay 6y ago
    > Most people aren't looking for an investment vehicle, a replacement for USD, a way to challenge central banks, or a way to perform zero-trust financial transactions. I agree with you, and I am a "invest in a well-balanced mutual fund and retire in comfort" sort of person, not at all the target audience for bitcoin. Still, even an explanation of why it had the potential to replace USD or challenge the central banks would have been interesting. No one seemed to go further than "because I said so" Honestly I've yet to meet anyone who wants to take down central banking who seems to have the faintest idea how banking works.
PeterStuer 6y ago
"Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency." The coin/currency thing is misleading. You should compare it more to gold than to USD etc. Something off which the issuers can't conjure up 4 trillion out of thin air whenever their palls want 'moar!'. USD would be completely Zim dollas by now if it weren't for the petrodollar scam.
nprateem 6y ago
I read an interesting book the other day on technology & economics that I'd highly recommend [1]. Tech creates efficiencies. Cryptos have potential to remove large swathes of the financial system, making things more efficient. [1] https://www.amazon.co.uk/Price-Tomorrow-Deflation-Abundant-Future-ebook/dp/B08334WFSQ/ https://www.amazon.co.uk/Price-Tomorrow-Deflation-Abundant-F...
- maclured 6y ago
  This. Smart contracts have lots of possible uses such as removing brokers (housing deeds), flattening distribution (there's one musician selling on etherium via a smart contract) etc. Projects like particl [1] are creating a decentralised, anonymous marketplace with very low fees. Imagine being able to sell on ebay or amazon and only paying pennies in listing fees. This is an early stage in crypto but the trend is inevitable. [1] https://particl.io https://particl.io
astrolince 6y ago
You don't get it because you are privileged, we get it in the third world, the things that you see as dumb and simple, aren't granted at all here
- exclusiv 6y ago
  Just because someone doesn't like Bitcoin doesn't mean it's a misunderstanding because they're privileged. Bitcoin IS a terrible currency because it's volatile. Really the worst aspect to have in a currency. Also, your statement alludes to Bitcoin being the one true way, as if there are no other options for third world countries. Volatility in a currency is a terrible idea and it gets even more terrible of an idea when utilized by people with little money. Can you explain how a volatile thing like Bitcoin is a reasonable currency for third world countries?
  - neop1x 6y ago
    Fiat money is also volatile like crazy. Look at various forex pairs. USDCZK for example had 22% change in the past year and both are "stable" currencies.
    - exclusiv 6y ago
      You're talking about exchange. But even in that example, it's not anywhere near the equivalent of going from ~17k to 3.5k, then up to 45k+ as bitcoin.
minusSeven 6y ago
Cryptocurrencies as it exists today is nowhere capable of replacing currencies altogether. That doesn't mean cryptocurrencies don't have their uses. Almost everything illegal is now being done using crypto. When people look at bitcoins they think of 2 things. 1. A form of investments that will give fantastic returns in future. 2. A technology that solves a problem. Its the 2nd point that is more important about but the 1st that will always dominate conversations.
- FabHK 6y ago
  Re 2), the technology's application are very very few, I think. I haven't really seen any except BTC itself, which is pretty bad at being money. That leads to it being "a store of value", and therefore 1) It won't give fantastic returns in the future forever.
icedchai 6y ago
Bitcoin is nearly useless as a currency. Every time I've spent it on something, I've regretted it. Example: The bitcoin I used to buy that mechanical keyboard in 2014 would be worth more than a new car today...
- oleganza 6y ago
  Yet you did it more than once? Kinda like you have personal preference between having X portion of your savings S to be exchanged for goods today (life is short) and leaving S-X for the future uses (life is not that short)?
  - icedchai 6y ago
    That is basically what I do... I spend a little bit every year. These days I mostly cash it out and invest it into stocks and ETFs. About 5% of my net worth is still in crypto.
kleer001 6y ago
> Bitcoin is a mystery to me. Aka "I don't know what I'm talking about." Time to do some research. Here's the white paper: (pick your prefered language) https://bitcoin.org/en/bitcoin-paper https://bitcoin.org/en/bitcoin-paper Read it over and over again. Then read and understand some commentary on Bitcoin: https://nakamotoinstitute.org/crash-course/ https://nakamotoinstitute.org/crash-course/ Then get back to us. > Getting rid of currency altogether. Let's get rid of water while we're at it too. Please, next time learn something before spouting off your ignorance, that's just plain tr0lling... Unless you ask direct questions!
sandworm101 6y ago
>> You know what would be revolutionary? Getting rid of currency altogether. Many have tried. Probably most famously, the writers behind Star Trek tried to build a fictional world without currencies. Even that didn't last. All manner of currencies were introduced to sustain various plot points. Some form of money exists in every large scifi franchise. We cannot even maintain the thought experiment of a fictional society without currency. At this point a world without currency is literally beyond our imagination.
gher-shyu3i 6y ago
The economy throughout history was not based on artificial deflationary currencies that are controlled by the banks and governments. It's time to go back to them and put power in the hands of the working people, not corrupt individuals who control the amount of wealth as they wish.
randomsearch 6y ago
I agree. One "strong-manning" observation: it seems to me that a digital currency could really facilitate international trade. As I understand it, bitcoin may not be technically suited for general transactional use (I may be wrong) but in general this could be very useful, to avoid the bureaucracy and charges of changing currency multiple times.
edwinespinosa09 6y ago
I think most investors see it more as a store of value, compared to fiat, and more scarcity, transportability and accountability than gold/hard assets.
christiansakai 6y ago
I know plenty of people who I thought was humanitarian, environmentally conscious, smart, critical, hold advanced degrees, reasonable, all the good stuffs. Everything flies out of the window when they discover Bitcoin. Suddenly they don't want to work anymore and just buy Bitcoin and confessed they've been stupid all this time railing against Bitcoin.
moralsupply 6y ago
Please feel free to never convert your fiat to cryptocurrencies. You'll do very well according to your logic.
mparramon 6y ago
This comment gives me https://news.ycombinator.com/item?id=9224 https://news.ycombinator.com/item?id=9224 vibes.
sperma 6y ago
> Bitcoin is a mystery to me sorry about that. one day you will understand it
BinaryAcid 6y ago
It never ceases to amaze me that people who should understand the magnitude of this technology the most are sometimes the slowest to get it. It's programmable cash. Uncontrollable. Dis-intermediated.
jwblackwell 6y ago
Greed is natural. Embrace it.

I_am_tiberius 6y ago

I don't understand such kind of comments. Let's talk again after you experienced a bank cancelling your business account for no reason with seemingly having landed on a shared hidden blacklist that makes it impossible to get a new bank account.

robjan 6y ago
Has bitcoin actually solved that problem though?
- vntok 6y ago
  Yes it has, anyone in the world can open their own "current account"/"deposit account" for free, right now. Barring hacking you, no government or authority can access it without your consent. None can prevent you from receiving money in it from someone else, or from transferring money out of it to someone else.
  - robjan 6y ago
    I can receive bitcoins but I cant buy food with bitcoins or pay my staff with bitcoins. At some point I need to convert these coins to fiat and that's subject to the same controls that GP noted.
    - chill1 6y ago
      Are you sure you can't spend Bitcoin directly for goods and services? Have you tried? When was the last time you searched for physical shops near you [1] that accept it? [1] https://coinmap.org/ https://coinmap.org/
      - twox2 6y ago
        The fees are too high and at least in the US, every transaction is taxable.
        chill1 6y ago
        No one should be using on-chain Bitcoin transactions for in-person exchange. Partly due to the high fees, but mostly because of double-spending and lack of privacy. Lightning Network solves all of these problems. Fees are much lower, settlement is instant and clear to even unsophisticated users, and the recipient cannot see from where the funds originated. Taxes are a different issue and that's up to each jurisdiction to solve via better legislation.
        twox2 6y ago
        Don't you still have to pay the tx fee to open a lightning network channel? Anyway the whole thing lost me with the block size debate (always been a big blocker). Where are we at with lightning network adoption anyway?
        chill1 6y ago
        Yes, an on-chain transaction is required to open a channel. But once open you can continue to use it forever, or until you (or your counter-party) decide to close it. Lightning Network adoption is slow and steady. There are several newbie-friendly mobile wallet apps available [1][2][3]. Some nice improvements have been developed and pushed live in the last 18 months (e.g watchtowers [4] and atomic multi-path payments (AMP) [5]). There are now five Lightning Network node implementations (lnd, eclair, c-lightning, rust lightning, Electrum). And there are hardware projects working to bring LN into the physical space - one of which is my own project, a Lightning-only Bitcoin ATM named "Bleskomat" [6]. [1] https://phoenix.acinq.co/ https://phoenix.acinq.co/ [2] https://www.walletofsatoshi.com/ https://www.walletofsatoshi.com/ (!!) <-- custodial [3] https://breez.technology/ https://breez.technology/ [4] https://github.com/lnbook/lnbook/blob/8d2582e51eb615c850b24e83d41d9f5b673cd45e/node_operations.asciidoc#watchtowers https://github.com/lnbook/lnbook/blob/8d2582e51eb615c850b24e... [5] https://lists.linuxfoundation.org/pipermail/lightning-dev/2018-February/000993.html https://lists.linuxfoundation.org/pipermail/lightning-dev/20... [6] https://www.bleskomat.com/ https://www.bleskomat.com/

sixQuarks 6y ago

Initially it was meant to be used as currency, but it's become more of an asset class now, mainly used as a store of value, similar to gold. Do you know how difficult it is to get millions of people to agree that something is a store of value, not only agree, but to put their money where their mouth is? THIS is why bitcoin is where it's at.

eli 6y ago
At least you can build useful things out of gold
- charcircuit 6y ago
  and you can build useful things using cryptocurrency via smart contracts.
  - MrMan 6y ago
    I think smart contracts with dollars would be just as good
    - charcircuit 6y ago
      I'm not sure what you mean. You can't program the dollar bill. It's a piece of paper. If you are asking why stable coins pegged to the dollar don't exist, well they already exist.
    - tinco 6y ago
      You can build smart contracts with dollars through the Ethereum cryptocurrency. If you think you can make smart contracts any other way then you don't really understand what smart contracts are.
  - eli 6y ago
    can you, though?
    - 6y ago

ianhawes 6y ago

Bitcoin has revolutionized the black market economy.

bitxbitxbitcoin 6y ago
Bitcoin has definitely done that but more importantly it has revolutionized the Shadow Economy - which is a lot larger than most people realize.
- hfsp 6y ago
  The USD remains the choice of the cartels and professional money launderers. After all, pro crooks do not want to leave an eternal trace of their transactions on a public ledger on the internet.
  - bushbaba 6y ago
    Disagree. There’s a reason terrorists such-as hamas, al queda, isis choose to use btc. https://www.coindesk.com/us-prosecutors-attempt-to-seize-bitcoin-allegedly-tied-to-al-qaeda https://www.coindesk.com/us-prosecutors-attempt-to-seize-bit...
  - SEJeff 6y ago
    This so much ^ The FBI has already proven pretty well that with a big enough dragnet (and resource that places like the NSA absolutely have), they can associate people to wallet addresses. It just takes slipping up a single time and they'll find you.
    - jackTheMan 6y ago
      If it is the interest of FBI, also according to this article, in some places an email address is enough to open an account: https://www.bnnbloomberg.ca/booming-crypto-market-a-potential-haven-for-money-laundering-1.1502161 https://www.bnnbloomberg.ca/booming-crypto-market-a-potentia... so not sure about the claim.

daraosn 6y ago

> You know what would be revolutionary? Getting rid of currency altogether. What would be the point, going back to trading? You are missing the point, if you keep a good scarce versus another abundant, overtime the scarce good will gain value. It's basic economics. Bitcoin is revolutionary because of the blockchain, but it's not its fault that it's gaining value, it's people over-hyping it every 4 years due to the halvening plus indiscriminate fiat money printing policy.

bhupy 6y ago

I'm still forming an opinion on cryptocurrency. You mention that decentralization is a very important step that we should try to take as a society. If that's the case, then why isn't Bitcoin (or PeerCoin etc etc) a step function revolution?

rzodkiew 6y ago
Because they are not really decentralised. Vast amounts of cryptocurrencies as they are designed right now are disproportionately held by the early adopters, who will inevitably engage in rent seeking in one way or another (I wish I was wrong on this one). Decentralisation has to happen through increasing trust between people, while cryptocurrencies are designed to replace trust. Yeah, current institutions controlling our monies are hardly worth the trust, but honestly bitcoin doesn't even remove that trust (it just shifts it to some random self-proclaimed experts at Tether, twitter gurus or god knows what else the crypto people are up to nowadays).
- bhupy 6y ago
  I think everything you said is correct about Bitcoin, but is that true of cryptocurrency in general? I think Bitcoin, which has its obvious flaws, is sort of the de facto flag-bearer of crypto, and more of a harbinger of things to come. I'm not yet convinced that Bitcoin will be the only cryptocurrency in widespread use, in the same way that the USD isn't the only fiat currency used in the world today.
  - rzodkiew 6y ago
    I would like to see some sort of cryptocurrency to be successful, just to satisfy my inner nerd, but I'm afraid most of its problems might not be technical in nature. Cryptocurrencies have potential to drastically change how recognition of value is created and distributed, so that's definitely an avenue to explore. Most of the big cryptos that are out there today don't really try to explore that, and currency is something external to value generation and recognition. I'd argue that even fiat currencies are actually closer to the value generation (as the money creation happens when banks give out loans, which at least are supposed to make world better). Purely from cryptocurrency perspective the only thing that it values is keeping the ledger alive. Exactly those self-sustaining by all means mechanisms are what leads to rot in many areas of life (academia, politics, corporations, you name it).

mrb 6y ago

«they buy it and what you holding increases in value, then tell them to do the same.» Literally the same happens to any investment: tell people to buy stock X, time share Y, precious metal Z, that it's awesome, so it gains value, etc The fact is Bitcoin/crypto is revolutionary. For example it allows merchants to cut down on fraud, since a payment received in BTC is irreversible, so chargeback fraud is impossible. It enables instantaneous B2B international payments. It allows escaping your country inflationary currency. It's censorship-resistant. It empowers the unbanked & underbanked.

chopin 6y ago
It one-sidedly favors the merchant, though.

JohnJamesRambo 6y ago

“The root problem with conventional currency is all the trust that's required to make it work. The central bank must be trusted not to debase the currency, but the history of fiat currencies is full of breaches of that trust.” -Satoshi Nakamoto Feb. 2009 If this isn’t resonating with you after the past year, I don’t know. I was forced to watch my government bungle a pandemic in the worst possible way and then asked to pay for it for decades. No I don’t think I will. Bitcoin is a way for me to step outside that debt I did not want or deserve. https://fred.stlouisfed.org/series/M1 https://fred.stlouisfed.org/series/M1

neilwilson 6y ago
" Bitcoin is a way for me to step outside that debt I did not want or deserve" Try paying your taxes in Bitcoin. Then you'll find that it has nothing to do with trust and everything to do with avoiding having your assets stripped by the IRS. You want to live in a jurisdiction, then you pony up the tokens that jurisdiction demands. Or you lose your liberty and everything you own.
- sygma 6y ago
  > At the city level, [Miami mayor] Suarez’s ambitions are equally ambitious. He’s “looking at” ways to pay municipal employees a percentage of their salary in bitcoin and allow residents to use bitcoin and other cryptocurrencies for “payments and fees,” including taxes. https://www.coindesk.com/miami-mayor-previews-favorable-crypto-policy https://www.coindesk.com/miami-mayor-previews-favorable-cryp...
  - mywittyname 6y ago
    I bet people still earn $50,000 a year and pay $1,500 a year in property taxes; not 1.2 btc or whatever.
    - FabHK 6y ago
      Exactly. As long as things are still denominated in fiat (and they are...), payment with BTC is just a gimmick.

patricius 6y ago

There are practical reasons that getting rid of currency - or money I assume you mean - is a bad idea. It would be much more difficult to exchange goods and services if we had to barter for instance. But perhaps you have some alternative in mind that I haven't thought of.

rzodkiew 6y ago
I do believe that there are some solutions that we could (and will) come up with, but they do require radical shift of priorities in people's lives. Currently our society is just blinded by "chase money by all means" which was always a part of the humanity, but definitely got worse since Commercial Revolution, then even pushed further by Industrial Revolution. At the same time I feel like the pushback is finally slowly showing up in many parts of the society. I wholeheartedly agree that we definitely do need some vehicle of value, and it might as well be currencies as we know them now, but with some hoarding-prevention mechanisms built in, or maybe some other way to figure out a value of time you provide to the society. Right now we rely on free market for that, but is the coffee you buy in the morning of same value to you as it is to the person in the queue after you? And if that coffee helps you build more value to society than your fellow man for whatever the reason, maybe part of that difference could also be captured by the coffee producer as well. If price of coffee was expressed in something like a fractional unit of your value in a day, let's say 0.02u, then you'd pay the same price, yet with wildly different absolute values. This is just random thought, and it probably will fail in hundreds of ways, but maybe something to spark your imagination.
fabianhjr 6y ago
> It would be much more difficult to exchange goods and services if we had to barter for instance. But perhaps you have some alternative in mind that I haven't thought of. There has been very few research and development into decentralized economic planning. (Imagine if only a fraction of the development resources that have gone into High Frequency and Momentum Trading had been invested into Decentralized Economic Planning) https://www.wikiwand.com/en/Planned_economy#/Decentralized_planning https://www.wikiwand.com/en/Planned_economy#/Decentralized_p... I am quite sure many here would agree that the Economic Calculation Problem doesn't hold much water nowadays (or at least won't in the near future) with the available computation power. https://www.wikiwand.com/en/Economic_calculation_problem https://www.wikiwand.com/en/Economic_calculation_problem

asenna 6y ago

> Then they buy into all of the cryptocurrency platitudes wholesale without stopping for a moment to critically evaluate it. Go ahead then, I would genuinely like to hear your critical evaluation since you just shit all over the Bitcoin whitepaper without any actual critique in your post. I don't understand the extreme polarization of Bitcoin on HN. It's a very interesting tech and it's still early in the adoption phase and the space is still evolving.

CapmCrackaWaka 6y ago

> You know what would be revolutionary? Getting rid of currency altogether. I would like to see your plans for this ;) Jokes aside, I think that Bitcoin attracting greedy people was inevitable. Bitcoin _was_ revolutionary in that it was a new financial instrument. Couple that with its explosion in value, and the 'hustle bros' will definitely come flocking trying to take advantage. However, if you were a part of it before it became popular, you would definitely know that it started as an oddity, a hobby for cryptographic enthusiasts. The hustle bros didn't write the protocol or sit around scheming about how to design this thing so they can scam people. It doesn't necessarily mean that Bitcoin is inherently bad, but its nature (decentralized, anonymous payments, complex, end users mostly don't understand the details) makes it ripe for the scams you mentioned.

bronak1 6y ago

Society has had multiple stores of value, as none is perfectly secure. Gold, oil, dollars, real estate, (some) bonds & equities. Crypto is the first that’s decentralized and digital and on a open network not governed by any centralized entity which is powerful bc the world needs a international reserve currency

MrMan 6y ago
I don't want to rely on a currency which is managed and beholden to an unelected cartel of corporations. I prefer representative government by elected officials.
- capableweb 6y ago
  > I don't want to rely on a currency which is managed and beholden to an unelected cartel of corporations. Great, don't think we have any currencies that are run by a cartel of corporations (yet), although Facebook's currency was probably gonna end up being that. For cryptocurrencies, they are usually run by "miners" who can be anyone, not just corporations. You can run your own miner, or your own node, hence they are called decentralized. This feature does not exist in our current centralized currencies, and is one of the main selling point of cryptocurrencies. > I prefer representative government by elected officials. That is great that you feel that you are represented correctly in your government, I am really happy for you. For many other people in the world though, that does not exist or if it does, doesn't work out in practice and people don't feel represented. You don't have to look very far to discover which countries I'm referring to. For people living in these countries, where they don't trust the central bank (like many don't trust the central bank in the US to have people's best interest at heart), cryptocurrencies offer a way out of the system without going off-grid and leaving the option of having things to trade with, without going back to a goods barter ecosystem.
  - SV_BubbleTime 6y ago
    Good points, but he’s still right. For all the talk of Bitcoin being decentralized there are a dozen people or so that could destroy the whole system if they so chose to. Overtly or covertly. Despite my feelings about governments specific actions, and the bank system, not even the President or the Fed or Congress could do that as quickly with the dollar.... although sometimes you would think they are trying.

andreygrehov 6y ago

> by replacing currency with a worse kind of currency. The reason why Bitcoin is a mystery for many people is exactly because of this ^. Bitcoin is NOT a currency. It doesn't position itself as a currency. This fairytale is long gone, forget about it. Bitcoin is a store of value. It cost $7.6M and took five years to repatriate 53,780 gold bars worth $27B back from the US to Germany. It's >1000X faster and >10X cheaper to move that much in Bitcoin , even accounting for N>>6 confirmations.

kgwgk 6y ago
> It doesn't position itself as a currency. This fairytale is long gone, forget about it. Bitcoin doesn’t position itself as anything. In other comments, though, you can see people are still defending its usefulness as currency. Your example is a bit strange, by the way. Transatlantic bank transfers in your currency of choice have been a solved problem for decades.
- andreygrehov 6y ago
  I'm talking about transferring bars of gold, which is not the same as a digital transfer.
  - kgwgk 6y ago
    So bitcoin, despite being more volatile than gold, is a better store of value because it can be transferred more easily? Ok then. It can also be stolen or lost more easily, though.
    - andreygrehov 6y ago
      There is always going to be "It can also...". I can say that a friend of yours can come to your place and steal a golden ring from your desk. The volatility concern will eventually go away. Volatility represents people's opinion about Bitcoin. They don't understand it yet. If you look into history, you'll notice that pretty much every new invention goes through this phase. People's first reaction is always the same - "nobody needs it, nobody's going to ever use it".

me551ah 6y ago

I don't get why bitcoin is worth so much.Bitcoin is called a store of value like gold, but gold has inherent uses. If the price of gold went to zero then you could still use it to make jewellery or use it for electrical conductivity. If the price of bitcoin goes to zero then it's worthless. It's also not environmentally friendly and bitcoin mining uses up 0.21% of the world's power supply. And all of this energy is used to calculate billions of hashes per second out of which all but one will be discarded. There is also increased regulatory focus from governments who see it as a threat , with India even going so far as to suggest they would ban it.

capableweb 6y ago
Literally mining gold is also not very environmentally friendly and uses a lot of power, probably not as much as Bitcoin though. And Bitcoin will always remain what it is now, a system for transferring bits in a decentralized fashion over the internet. Even if Bitcoin is worth $0, as long as there is a sender and a receiver (and at least one miner online), you'll be able to transact Bitcoin, this is hardly worthless. > governments who see it as a threat , with India even going so far as to suggest they would ban it This for me is a huge selling point for Bitcoin (et al). If famously shady governments like India and the US starts talking about banning something, I immediately start looking into why and how they are banning it. So far, the arguments seems to be that they are scared of loosing control, and if it gotten that far, it's because they genuinely believe cryptocurrencies could replace their centralized currencies. More reason to get involved in it.
- me551ah 6y ago
  Gold is unique, few metals can match it's shine and electrical conductivity. But there exist many cryptocurrencies which can act as "a system for transferring bits in a decentralized fashion over the internet". Many also do a far better job than bitcoin. So shouldn't they be more valuable than bitcoin? Etherium, Monero etc Yes, but you really can't fight the government and run a parallel currency. If the government bans it then you cannot use it for any legal transactions.
  - 6y ago

ctdonath 6y ago

Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency. “Bad money drives out good.” Best money is a compact, moderate/high value, easily verified, inherently useful/desirable, fungible, divisible/mergeable, stable material of a generally agreed on value. Worse money scrapes away these factors as a matter of convenience & opportunism. We’re now reduced to verbal anonymous confirmation that user X is agreed owner of number B, with a market value of V - there is no physical manifestation.

INTPenis 6y ago

Let me demystify it for you. It's used for drugs. That's how I view it. A very small minority of die hards are trying to use it for other things, donations of course, but it's mostly used for drugs. There's a "paper" on pnas claiming the opposite but if you actually read it they make massive assumptions in it. I can't believe they were allowed to publish a paper based on assumptions.

GreenHeuristics 6y ago
The story is literally about Tesla buying 1.5B usd worth of it. Sure Elon has some interests in the direction but I doubt Tesla is going to use the bought Bitcoin for drugs.
- INTPenis 6y ago
  Ok, so besides Teslas investment of 1.5B USD, what do you think bitcoin is used for?
  - olah_1 6y ago
    > what do you think bitcoin is used for? Storing value. Smart ass answer, I know. But it's true. As a private currency, Bitcoin is like a screen door. So I don't know why you'd use it for illegal activities.
    - INTPenis 6y ago
      Ok good point but I was thinking of daily use. Storing value is not daily use, it's just laying there. Just look at the stories of darkweb markets they take down. Thousands of sellers, catering to tens or hundreds of thousands of buyers. There is no other market anywhere in the world using cryptocurrency to that extent.
      - rspeele 6y ago
        Don't forget ransomware, crypto's killer app.

amelius 6y ago

Wouldn't the same apply to gold?

ctdonath 6y ago

You know what would be revolutionary? Getting rid of currency altogether. So long as we still exist in a scarcity reality (not the utopian post-scarcity vision), there must a way to abstractly represent the value one possesses and may trade for goods/services.

pontifier 6y ago

>You know what would be revolutionary? Getting rid of currency altogether. I agree. The future is not keeping track. If someone needs something they should have it. The only reason that hasn't happened is scarcity and logistics, which I believe we will solve in the not so distant future.

forgot_account 6y ago
>>>If someone needs something they should have it. What mechanism will exist to validate conflicting "needs" of different people in the not-so-distant future? Extreme example: we can't give everyone their own mansion with a beachfront view in order to prevent triggering them.
mac01021 6y ago
The problem is that people need so little and that 98% of commerce consists of people transacting for something more than the bare minimum of staying alive.

mrb 6y ago

While away on vacation, I once sent $1000 in cold hard cash, on a Sunday, to an unbanked person in Los Angeles, in less than 1 hour, thanks to bitcoin and the recipient withdrawing it for cash at a Bitcoin ATM. There is not a single alternative service in the world that would have made this possible. If people thought a little beyond their personal use cases, they would understand the utility of Bitcoin/crypto for many others. The technology is a paradigm shift. The financial world is structured as it is because of its existing flaws. Bitcoin/crypto enables things that people don't know they need because they are now possible.

bl557 6y ago
https://twitter.com/gladstein/status/1357757736394444800 https://twitter.com/gladstein/status/1357757736394444800
bryanlarsen 6y ago
Western Union has been doing this for > 150 years.
- cassianoleal 6y ago
  I don't know where you are but in a lot of places to use Western Union you have to physically go to one of their stores. With BTC I can buy them via the internet, and the person on the other side can also convert to cash in their own account via the internet, then withdraw on any ATM. It's worlds apart. Edit: I guess if you only consider the parent's use-case where the other person went to a Bitcoin ATM it's not that different but my point stands as it's only 1 other layer in the process and it's an online one.
  - macspoofing 6y ago
    For now. Cryptocurrency is still in the 'honeymoon' phase where it hasn't been fully targeted by governments and regulatory bodies. That will change soon enough. You can't skirt AML regulations forever.

newacct583 6y ago

> buy bitcoin - tell everyone around how revolutionary it is, so they buy it and what you holding increases in value, then tell them to do the same. That's actually not what's happening. Bitcoin got big because Tax Evasion. Or not literal tax evasion maybe, but attempts by wealthy chinese citizens to sequester their finances in a place it can't be seized by their government, which is largely the same thing. Add to that the expected rush of genuine criminal activity, and that's why crypto got big. The libertarian philosophy stuff and pyramid nonsense is a sideshow. Bitcoin is about enabling crime (even, again, where that crime seems "justified" to western eyes).

bl557 6y ago

Some of my favorite "Intro to Bitcoin" pieces - "Bitcoin For The Open Minded Skeptic" - https://www.paradigm.xyz/Bitcoin_For_The_Open_Minded_Skeptic.pdf https://www.paradigm.xyz/Bitcoin_For_The_Open_Minded_Skeptic... "Stone Ridge 2020 Shareholder Letter" - https://www.microstrategy.com/content/dam/website-assets/collateral/bitcoin-downloads/Stone-Ridge-2020-Shareholder-Letter.pdf https://www.microstrategy.com/content/dam/website-assets/col...

JeremyNT 6y ago

Bitcoin and similar cryptocurrencies solve some real problems that most people don't actually have - they allow for verifiable electronic transactions without having to trust any single entity in the chain. The problem Bitcoin and other cryptos actually solves for most people is different. That problem is summarized as "I have (or can borrow, at a low rate) fiat currency, and want to get a much higher return on my investment than the low rates traditional savings provide." Money is cheap right now, and essentially, the returns on these things beat inflation and stock markets. For now. But one of these days the market will collapse - you just have to make sure you get out before that happens.

GizmoSwan 6y ago
Yes but once they are used for tax evasion and underground economy they can become worthless in hands of people that deal with it as a legal asset. Governments can regulate any asset class.

_alex_ 6y ago

the key technical innovation that bitcoin gave us (that ethereum and other systems took to the next level) is a replicated state machine shared by untrusted peers. That's a huge deal for decentralized systems. It turns out that economics is a good way to keep network participants honest.

narcissismo 6y ago

Large numbers of the 'get rich quick' crowd that you speak of become poor after each crash. More will follow. Each time this happens, I stand in awe of the brilliance of bitcoin - not so much the details of UTXOs or hash magic, but the choice of time base and halving intervals. Its as if it were designed to be a FOMO feedback loop from the outset. The fact that its still working after so many boom/bust cycles is amazing. [Edit] clarify reference to parent

oleganza 6y ago
I think halvings-driving-fomo is a myth. Each halving is possibly a catalyst for the crowds-waiting-to-jump-in, but not the reason for them occuring in the first place. Even without halvings, there would be speculative bubbles, then they'd pop, and the bubble attracted attention and people would start forming a line, but not buying until price begins to confidently move upwards. Since there's little actual utility in using bitcoin right away (even if it was accepted everywhere, but you have fiat, why would you need to buy btc and immediately sell it?), people who'd like to invest would never rush buying until price stabilizes and begins growing. This naturally produces these "steps": BTC goes up 5-10x, then mania kicks in, then it goes 2-3x higher and then pops 2-3x down. Every convinced investor bought before the mania phase, weak hands sold off at a moderate return or at a loss, while a bunch of new people got interested. Halvings are just one of those points that help tipping off the balance for the already formed crowd.

panarky 6y ago

> this whole crypto-crap infested the idea space of decentralisation Then we learned that there are enough bad actors to ruin most decentralized applications before they get big enough to make a difference. Unless the incentives are strong enough. Tokenomics has proven to be a pretty effective way to do that.

cloudhead 6y ago

Curious to know what would invalidate your current belief? It seems like half a trillion dollars in economic value is not convincing enough. So what is?

agloeregrets 6y ago

I feel like a good modern way to explain Bitcoin is to say it's like the gamestock drama from two weeks ago, except the people who have bitcoin are playing both r/wallstreetbets AND the hedge funds. Just inflating the price of something hat doesn't make sense at all to inflate without volume. The value is made up and the economics (and lack of eco-validity) don't matter! Eth's new developments may fix this but 99% less is still a lot without investment. A more fun way to frame this story is 'Self-aggrandizing Green-tech company admits to supporting use of payment processor that uses more than 1000X more power than other options'

washedup 6y ago

"Getting rid of currency altogether" - please explain this nonsense

CountDrewku 6y ago
Dude thinks we're gonna live in some Star Trek utopia where one needs money anymore because everything is provided and we all work just for the personal pleasure of discovering new things. Except.... they never explain how they got to that "utopia" in Star Trek and there's a good reason ha ha.

goseeastarwar 6y ago

The mental gymnastics people will play to behave like Bitcoin is anything but a FOMO ponzi scheme is extremely entertaining. They’ll proselytize this fancy new currency that'll eliminate central banking and revolutionize money transfer, while also slipping in the price they bought in at.

dr-detroit 6y ago

Literally every play Musk makes is for subsidies or tax dodge file this one under tax dodge.

nineplay 6y ago

I tried, I sincerely did. I had many friends who were strong believers in bitcoin. I read articles, I watched videos, and every time it felt like hucksterism. There was no serious discussion of the advantages of bitcoin, no attempt to explain blockchain. There was a lot of repeating, over and over again, how amazing and revolutionary bitcoin was. "For the first time ever, a computer owns currency!" one youtuber said without the slightest effort to explain why I should care. Maybe I missed something. Obviously some people did well on it, and if I'd just skipped all those videos, bought a few hundred dollars worth, and then sold those shares a few years later I'd be a lot better off right now.

helen___keller 6y ago
> "For the first time ever, a computer owns currency!" one youtuber said without the slightest effort to explain why I should care. The truth is for most people, there's no reason to care. Maybe there will be in the future, but not yet. Most people aren't looking for an investment vehicle, a replacement for USD, a way to challenge central banks, or a way to perform zero-trust financial transactions. Most people want to do what they already do in day-to-day life but with less overhead costs or more ease of use. Bitcoin does nothing for this: on-chain transaction fees are too high, lightning network is not there yet, very few places offer support for btc payments, and so on. All these problems add up to a simple conclusion that btc is not useful for the average person, so instead proponents have to sell a majestic vision of the future or a get-rich-quick scheme. Most go for the latter.
- nineplay 6y ago
  > Most people aren't looking for an investment vehicle, a replacement for USD, a way to challenge central banks, or a way to perform zero-trust financial transactions. I agree with you, and I am a "invest in a well-balanced mutual fund and retire in comfort" sort of person, not at all the target audience for bitcoin. Still, even an explanation of why it had the potential to replace USD or challenge the central banks would have been interesting. No one seemed to go further than "because I said so" Honestly I've yet to meet anyone who wants to take down central banking who seems to have the faintest idea how banking works.

PeterStuer 6y ago

"Bitcoin is a mystery to me. Somehow it's hailed as revolutionising the economy, by replacing currency with a worse kind of currency." The coin/currency thing is misleading. You should compare it more to gold than to USD etc. Something off which the issuers can't conjure up 4 trillion out of thin air whenever their palls want 'moar!'. USD would be completely Zim dollas by now if it weren't for the petrodollar scam.

nprateem 6y ago

I read an interesting book the other day on technology & economics that I'd highly recommend [1]. Tech creates efficiencies. Cryptos have potential to remove large swathes of the financial system, making things more efficient. [1] https://www.amazon.co.uk/Price-Tomorrow-Deflation-Abundant-Future-ebook/dp/B08334WFSQ/ https://www.amazon.co.uk/Price-Tomorrow-Deflation-Abundant-F...

maclured 6y ago
This. Smart contracts have lots of possible uses such as removing brokers (housing deeds), flattening distribution (there's one musician selling on etherium via a smart contract) etc. Projects like particl [1] are creating a decentralised, anonymous marketplace with very low fees. Imagine being able to sell on ebay or amazon and only paying pennies in listing fees. This is an early stage in crypto but the trend is inevitable. [1] https://particl.io https://particl.io

astrolince 6y ago

You don't get it because you are privileged, we get it in the third world, the things that you see as dumb and simple, aren't granted at all here

exclusiv 6y ago
Just because someone doesn't like Bitcoin doesn't mean it's a misunderstanding because they're privileged. Bitcoin IS a terrible currency because it's volatile. Really the worst aspect to have in a currency. Also, your statement alludes to Bitcoin being the one true way, as if there are no other options for third world countries. Volatility in a currency is a terrible idea and it gets even more terrible of an idea when utilized by people with little money. Can you explain how a volatile thing like Bitcoin is a reasonable currency for third world countries?
- neop1x 6y ago
  Fiat money is also volatile like crazy. Look at various forex pairs. USDCZK for example had 22% change in the past year and both are "stable" currencies.
  - exclusiv 6y ago
    You're talking about exchange. But even in that example, it's not anywhere near the equivalent of going from ~17k to 3.5k, then up to 45k+ as bitcoin.

minusSeven 6y ago

Cryptocurrencies as it exists today is nowhere capable of replacing currencies altogether. That doesn't mean cryptocurrencies don't have their uses. Almost everything illegal is now being done using crypto. When people look at bitcoins they think of 2 things. 1. A form of investments that will give fantastic returns in future. 2. A technology that solves a problem. Its the 2nd point that is more important about but the 1st that will always dominate conversations.

FabHK 6y ago
Re 2), the technology's application are very very few, I think. I haven't really seen any except BTC itself, which is pretty bad at being money. That leads to it being "a store of value", and therefore 1) It won't give fantastic returns in the future forever.

icedchai 6y ago

Bitcoin is nearly useless as a currency. Every time I've spent it on something, I've regretted it. Example: The bitcoin I used to buy that mechanical keyboard in 2014 would be worth more than a new car today...

oleganza 6y ago
Yet you did it more than once? Kinda like you have personal preference between having X portion of your savings S to be exchanged for goods today (life is short) and leaving S-X for the future uses (life is not that short)?
- icedchai 6y ago
  That is basically what I do... I spend a little bit every year. These days I mostly cash it out and invest it into stocks and ETFs. About 5% of my net worth is still in crypto.

kleer001 6y ago

> Bitcoin is a mystery to me. Aka "I don't know what I'm talking about." Time to do some research. Here's the white paper: (pick your prefered language) https://bitcoin.org/en/bitcoin-paper https://bitcoin.org/en/bitcoin-paper Read it over and over again. Then read and understand some commentary on Bitcoin: https://nakamotoinstitute.org/crash-course/ https://nakamotoinstitute.org/crash-course/ Then get back to us. > Getting rid of currency altogether. Let's get rid of water while we're at it too. Please, next time learn something before spouting off your ignorance, that's just plain tr0lling... Unless you ask direct questions!

sandworm101 6y ago

>> You know what would be revolutionary? Getting rid of currency altogether. Many have tried. Probably most famously, the writers behind Star Trek tried to build a fictional world without currencies. Even that didn't last. All manner of currencies were introduced to sustain various plot points. Some form of money exists in every large scifi franchise. We cannot even maintain the thought experiment of a fictional society without currency. At this point a world without currency is literally beyond our imagination.

gher-shyu3i 6y ago

The economy throughout history was not based on artificial deflationary currencies that are controlled by the banks and governments. It's time to go back to them and put power in the hands of the working people, not corrupt individuals who control the amount of wealth as they wish.

randomsearch 6y ago

I agree. One "strong-manning" observation: it seems to me that a digital currency could really facilitate international trade. As I understand it, bitcoin may not be technically suited for general transactional use (I may be wrong) but in general this could be very useful, to avoid the bureaucracy and charges of changing currency multiple times.

edwinespinosa09 6y ago

I think most investors see it more as a store of value, compared to fiat, and more scarcity, transportability and accountability than gold/hard assets.

christiansakai 6y ago

I know plenty of people who I thought was humanitarian, environmentally conscious, smart, critical, hold advanced degrees, reasonable, all the good stuffs. Everything flies out of the window when they discover Bitcoin. Suddenly they don't want to work anymore and just buy Bitcoin and confessed they've been stupid all this time railing against Bitcoin.

moralsupply 6y ago

Please feel free to never convert your fiat to cryptocurrencies. You'll do very well according to your logic.

mparramon 6y ago

This comment gives me https://news.ycombinator.com/item?id=9224 https://news.ycombinator.com/item?id=9224 vibes.

sperma 6y ago

> Bitcoin is a mystery to me sorry about that. one day you will understand it

BinaryAcid 6y ago

It never ceases to amaze me that people who should understand the magnitude of this technology the most are sometimes the slowest to get it. It's programmable cash. Uncontrollable. Dis-intermediated.

jwblackwell 6y ago

Greed is natural. Embrace it.