5 ms·

> The best promotion for BTC is simply its price How is the astronomical price a promotion? People want thing when they can get them for less, not pay a record

> The best promotion for BTC is simply its price How is the astronomical price a promotion? People want thing when they can get them for less, not pay a record price for them. If you think bitcoin is a good deal at its current price then you must believe there’s some underlying fundamental that makes it worth tens of thousands of dollars. > the ease of setting up a Coinbase account, and mooning memes of $100k/coin. There’s no value proposition to having a coinbase account except acquiring cryptocurrency. One doesn’t even need to hold btc to post or enjoy memes. These have little and nothing to do with the cause of the high price. > Tesla, currently less than 1% of the global auto market, is worth more than several of the largest automakers combined. Musk pushing "to further diversify and maximize returns on our cash that is not required to maintain adequate operating liquidity" by buying into an asset which is currently in a bull cycle is a good way to attempt to justify that price. That explains why Musk would buy it. That does not explain why anyone else would buy it. > Simply compare the price of BTC now to where it was a year ago, and take a look at its trajectory on the chart. Obviously, if there weren’t fundamentals, now would be a good time to sell. > Animal spirits are self-explanatory. Animal spirits are an unnecessary hypothesis for this event.

Apocryphon 6y ago
> How is the astronomical price a promotion? Because people are expecting it to get to $100k, which means it's a hot commodity in a speculative bubble. Not everyone who buys into a bubble believes that the underlying fundamentals justify the price in the long run- they just believe that there's room to grow, and that there are greater fools to sell to. > These have little and nothing to do with the cause of the high price. Just like the ease and lack of fees of Robinhood spur more stock-buying, Coinbase makes trading crypto easy and facilitates more bandwagoners who further pump up the price. > That explains why Musk would buy it. That does not explain why anyone else would buy it. I brought up that reason with Musk in mind. And Tesla buying it has direct second order effects- it popularizes and legitimizes BTC and cause more to buy into it, whether they're familiar with the underlying intentions of BTC or not. > Obviously, if there weren’t fundamentals, now would be a good time to sell. People buying in now believe there's still room for the price to rise. An asset with solid fundamentals (Tesla stock, GameStop call options) can also be wildly overvalued. I'm sure similar conversations were happening in 2018. > Animal spirits are an unnecessary hypothesis for this event. Look at the market. Look at the economy. Everything is animal spirits now in search of yield. https://themargins.substack.com/p/zirp-explains-the-world https://themargins.substack.com/p/zirp-explains-the-world
- chordalkeyboard 6y ago
  > Everything is animal spirits now in search of yield. Zirp explains exactly why asset prices are inflating, as I said before, animal spirits are an unnecessary hypothesis. > Because people are expecting it to get to $100k, which means it's a hot commodity in a speculative bubble. Not everyone who buys into a bubble believes that the underlying fundamentals justify the price in the long run- they just believe that there's room to grow, and that there are greater fools to sell to. When there are underlying fundamentals, as in the case of bitcoin, its not necessary to speculate on why people might buy a thing otherwise. Certainly there are people who buy because its trendy. Thats not really relevant though.
  - Apocryphon 6y ago
    I think it all goes back to your original statement about bitcoin enthusiasts being more likely to have a better understanding of fiat than the average person. Upon closer retrospection, you are probably right, because even if the BTC market might be dominated by bandwagoners who are only preoccupied about asset value and the potential for reselling it for real fiat money once it's at a desired price, the "enthusiasts" probably do in fact understand the technology enough to understand its implications.
  - pmiller2 6y ago
    What are these "fundamentals" you speak of? Why should I pay anything at all for a record of the fact that someone, sometime in the past solved a useless math problem?
    - chordalkeyboard 6y ago
      Scarcity. It’s ledger money. People want a unit of exchange that won’t depreciate as a result of the creation of new units. bitcoin meets that need.
      - pmiller2 6y ago
        So what if it's scarce? Why should I be transacting using a record of someone's solution to a useless math problem to begin with? You haven't answered my question at all. As for it "not depreciating," I claim that's because people believe it should go up, i.e. BTC is worth something (meaning you can exchange it for USD at a favorable rate) because people say it should be -- by fiat of the speculation market rather than fiat by a central backing agency. If it were only worth something because it "didn't depreciate," it BTC rises would correlate strongly with inflation. Since there's been essentially no inflation since BTC has been created, that's obviously untrue. I would also take issue with the assertion that it is, in fact, scarce. Scarcity means nothing when you literally have something that is arbitrarily subdividable. PS, the USD is also "ledger money." Well over 90% of USD only exist as bits in a computer system. It's essentially the same as a private blockchain.

Apocryphon 6y ago

> How is the astronomical price a promotion? Because people are expecting it to get to $100k, which means it's a hot commodity in a speculative bubble. Not everyone who buys into a bubble believes that the underlying fundamentals justify the price in the long run- they just believe that there's room to grow, and that there are greater fools to sell to. > These have little and nothing to do with the cause of the high price. Just like the ease and lack of fees of Robinhood spur more stock-buying, Coinbase makes trading crypto easy and facilitates more bandwagoners who further pump up the price. > That explains why Musk would buy it. That does not explain why anyone else would buy it. I brought up that reason with Musk in mind. And Tesla buying it has direct second order effects- it popularizes and legitimizes BTC and cause more to buy into it, whether they're familiar with the underlying intentions of BTC or not. > Obviously, if there weren’t fundamentals, now would be a good time to sell. People buying in now believe there's still room for the price to rise. An asset with solid fundamentals (Tesla stock, GameStop call options) can also be wildly overvalued. I'm sure similar conversations were happening in 2018. > Animal spirits are an unnecessary hypothesis for this event. Look at the market. Look at the economy. Everything is animal spirits now in search of yield. https://themargins.substack.com/p/zirp-explains-the-world https://themargins.substack.com/p/zirp-explains-the-world

chordalkeyboard 6y ago
> Everything is animal spirits now in search of yield. Zirp explains exactly why asset prices are inflating, as I said before, animal spirits are an unnecessary hypothesis. > Because people are expecting it to get to $100k, which means it's a hot commodity in a speculative bubble. Not everyone who buys into a bubble believes that the underlying fundamentals justify the price in the long run- they just believe that there's room to grow, and that there are greater fools to sell to. When there are underlying fundamentals, as in the case of bitcoin, its not necessary to speculate on why people might buy a thing otherwise. Certainly there are people who buy because its trendy. Thats not really relevant though.
- Apocryphon 6y ago
  I think it all goes back to your original statement about bitcoin enthusiasts being more likely to have a better understanding of fiat than the average person. Upon closer retrospection, you are probably right, because even if the BTC market might be dominated by bandwagoners who are only preoccupied about asset value and the potential for reselling it for real fiat money once it's at a desired price, the "enthusiasts" probably do in fact understand the technology enough to understand its implications.
- pmiller2 6y ago
  What are these "fundamentals" you speak of? Why should I pay anything at all for a record of the fact that someone, sometime in the past solved a useless math problem?
  - chordalkeyboard 6y ago
    Scarcity. It’s ledger money. People want a unit of exchange that won’t depreciate as a result of the creation of new units. bitcoin meets that need.
    - pmiller2 6y ago
      So what if it's scarce? Why should I be transacting using a record of someone's solution to a useless math problem to begin with? You haven't answered my question at all. As for it "not depreciating," I claim that's because people believe it should go up, i.e. BTC is worth something (meaning you can exchange it for USD at a favorable rate) because people say it should be -- by fiat of the speculation market rather than fiat by a central backing agency. If it were only worth something because it "didn't depreciate," it BTC rises would correlate strongly with inflation. Since there's been essentially no inflation since BTC has been created, that's obviously untrue. I would also take issue with the assertion that it is, in fact, scarce. Scarcity means nothing when you literally have something that is arbitrarily subdividable. PS, the USD is also "ledger money." Well over 90% of USD only exist as bits in a computer system. It's essentially the same as a private blockchain.