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>The thing is... Bitcoin solves a problem for almost nobody. It's almost entirely a speculative bubble. Citizens of stable countries are almost entirely better

>The thing is... Bitcoin solves a problem for almost nobody. It's almost entirely a speculative bubble. Citizens of stable countries are almost entirely better off with traditional currencies. Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight. There is a reason every asset is going up right now. Real estate, stocks, commodities, and crypto. More money is being printed this year than ever before. The financial media and the fed can claim minimal inflation but the markets are exposing that claim as dubious.

grumple 6y ago
> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight. Yeah, it's almost as though they had invested in Bitcoin during one of its crashes. What do you think they will say next time Bitcoin crashes back to 10% of its value?
- retrac 6y ago
  That they were foolish for holding onto Bitcoin itself. That's not what it's being used for. Here in the West there's basically no barriers for someone like me sending $10k or $10 million wherever, for whatever. Just ensure I pay any taxes on investment profits, and don't fund terrorists or drug cartels. Many countries are far more strict. E.g., Argentinians can only move $300 a month out of the country legally, as I understand it. If they want to purchase real estate in Canada or Australia as a hedge against inflation, for example, that can be very hard even if they have the funds. Getting around capital controls seems to be a niche for Bitcoin. I can think of few other ways to simply send $10,000 from Argentina to Nigeria in one hour, reliably and securely. Assuming people can exchange Bitcoin for cash or similar on both ends, it can be near-ideal for certain pairings compared to the legal and traditional financial system.
  - logifail 6y ago
    > Getting around capital controls seems to be a niche for Bitcoin Q: If you pitch up in, say, Canada or Australia, and offer to buy a chunk of expensive real estate and pay with Bitcoin, who is selling? Q2: ... or do you have to convert to AUD/CAD first, and if so, which bank(s) can you rely on to not worry about KYC? Q3: ... or do you have to actually travel to Canada or Australia first, in order to open a regular bank account first, in order to have somewhere to move your Bitcoin to, in order to have local currency, in order to be able to pay the local seller?
    - retrac 6y ago
      I do know that people have transacted real estate in Bitcoin in Canada before, mostly as a gimmick, but no reason you couldn't do that legally on the Canadian end. But I assume one would convert to CAD. What's the problem with KYC on the Canadian bank end? Canada has no such controls and wouldn't care that the money was laundered out of Argentina. Even if you had to do that, laundering the funds into Canada unfortunately does not seem it would be difficult in practice, given the apparent scale of money-laundering associated with the Vancouver housing market. And you do not have to be physically present to acquire property in Canada.
      - logifail 6y ago
        > laundering the funds into Canada unfortunately does not seem it would be difficult in practice Is this true only if you're sufficiently under the radar, or does it still hold true no matter how big/famous/wanted a criminal you are? EDIT: see https://www.step.org/industry-news/canadian-citizens-challenge-fatca-enforcement-will-be-further-appealed https://www.step.org/industry-news/canadian-citizens-challen... and https://www.fintrac-canafe.gc.ca/guidance-directives/client-clientele/1-eng https://www.fintrac-canafe.gc.ca/guidance-directives/client-... ??
        retrac 6y ago
        Of course some people get caught. (Though some of what I'm describing wouldn't be considered illegal under Canadian law in the first place. You can just buy property with BTC here if you have BTC.) Still, it's a huge problem: https://www.cbc.ca/news/canada/british-columbia/cullen-commission-money-laundering-bc-1.5583300 https://www.cbc.ca/news/canada/british-columbia/cullen-commi... https://globalnews.ca/news/7593419/bc-casinos-too-dangerous-cullen-commission/ https://globalnews.ca/news/7593419/bc-casinos-too-dangerous-...
  - heavyset_go 6y ago
    Western Union operates all over the world, you can send money instantly and the fees are lower than Bitcoin's network fees for transactions.
  - deleted 6y ago
    [deleted]
CamelCaseName 6y ago
Another reason why every asset is going up right now: https://fred.stlouisfed.org/series/PSAVERT https://fred.stlouisfed.org/series/PSAVERT Savings rates have exploded, and those funds need to go somewhere.
- deathanatos 6y ago
  Is the arrow of causality that way, though? I'm at the traditional "first-time-homebuyer" age, and I'm personally saving a fair portion of my income primarily because assets, such as houses, are so expensive. Were housing cheaper, I'd be paying a mortgage instead of a saving account. (And, I'd argue, sending longer doing so too due low interest rates.)
  - CamelCaseName 6y ago
    It includes home purchases, so that would not be a factor. As per the earlier link: > Personal saving is equal to personal income less personal outlays and personal taxes; it may generally be viewed as the portion of personal income that is used either to provide funds to capital markets or to invest in real assets such as residences.(https://www.bea.gov/national/pdf/all-chapters.pdf https://www.bea.gov/national/pdf/all-chapters.pdf)
- toinetoine 6y ago
  Looking at both, it looks like the gradual decline in the savings rate since the early 1980s correlates with a gradual decline in inflation from that time: https://www.macrotrends.net/countries/USA/united-states/inflation-rate-cpi https://www.macrotrends.net/countries/USA/united-states/infl...
Grim-444 6y ago
There are other safe-havens against inflation which have existed for hundreds of years. Bitcoin didn't invent the concept of an inflation hedge, and the citizens you refer to had and still have standard alternate solutions. Which in all honesty are a lot safer than a digital collectible token with no intrinsic value that's primarily used for speculating and drug deals, which can be regulated, shut down, or taken over whenever your or another country wants to shut it down.
- qertoip 6y ago
  Bitcoin is by far the best hedge against inflation. All assets tend to zero in Bitcoin terms, long term. This has been true for the last 12 years and will continue to be true.
  - CyberDildonics 6y ago
    This is groupthink propaganda nonsense. Bitcoin can only do 1.5KB/s of transactions and the average transaction costs $26. Any rapid decrease in price will lead to rapid decreases in mining and thus transaction throughput. Does this seem like the future of financial transactions to you?
    - scotty79 6y ago
      Transaction throughput doesn't depend on network hashrate. It gets adjusted to keep fixed througput.
      - CyberDildonics 6y ago
        In the short term it does. The block difficulty adjusts but not immediately. If hash rate drops rapidly, the time between blocks will lengthen, the time to adjustment will lengthen and the throughput will drop.
        scotty79 6y ago
        Yes. Bitcoin adjust difficulty to hash rate every two weeks. So if you drop hashrate more rapidly than that you can have lower transactuon throughput for up to two weeks. One on average.
JumpCrisscross 6y ago
> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight At best, this argument turns Bitcoin into a massive subsidy by stable countries of unstable ones. A subsidy paid for in the form of higher energy prices, environmental damage and opportunity cost.
nikanj 6y ago
A car used to cost 2BTC, then 20BTC, and presently some 1BTC. Bitcoin isn’t exactly the model currency for stability.
- nightski 6y ago
  You achieve stability through diversification, not by buying all stable assets. It's kind of like saying you don't want to buy an index fund because there are some really volatile stocks in there!
  - heterodoxxed 6y ago
    Remind me again, are we talking about an asset or a currency?
    - Closi 6y ago
      It depends what your argument is. If you are arguing that bitcoin is a bad currency because of high transfer fees, very few merchants accept it and that very few people are actually buying things with it in any meaningful way, then that's wrong because it's an asset. If you are arguing that as an asset it is purely speculative and has no fundamentals and zero return other than appreciation, then that's wrong because it's a store of value. If you are arguing that as a store of value it's actually highly volatile and has experienced multiple serious crashes, then that's wrong because it's actually a currency. This is the primary tactic Bitcoin seems to use to deploy to combat any criticism - if someone critiques its ability to do one thing you claim it's something else..
      - deleted 6y ago
        [deleted]
    - p_l 6y ago
      Depends on which problem of bitcoin they are currently defending.
    - nightski 6y ago
mtalantikite 6y ago
> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight. I don’t think any of my family in Algeria are using Bitcoin, and same for my wife’s family in Bangladesh. In Algeria at least, generally you’ll go to a hawala money changer who gives you better rates than the banks and exchange your local currency into Euros. If you need to send money abroad you use the same old Islamic hawala system to send it to France or wherever else. There will probably be some useful things built on top of blockchains, and I don’t think crypto has zero value, but I don’t think it’s going to reasonably fix a situation of a failing state.
- sneak 6y ago
  How do you know the hawala systems aren’t at least partially based on Bitcoin now?
M277 6y ago
Yeah, and how many citizens of these countries buy and use BTC? Particularly with how unstable it is compared to other assets like e.g. gold. Mind you, I speak as someone who is a citizen in a country that experienced that. Not now, but back in 2016, our currency got halved. Nobody, and I mean absolutely nobody ever thought "I should have bought crypto." When the 2017-2018 crypto rush happened, and people started mining ETH, well-off people* here got onto it and started mining ETH.... only to immediately sell it as they mined. Nobody held onto it. *well-off because GPUs were absurdly expensive due to the inflation, and it only got worse when the shortages hit. EDIT: I also want to add that very, very few people here in my country actually understand what bitcoin even is (or cryptocurrency or blockchain). The people that I have seen support mining here only really view it as a way to earn some money while doing nothing.
- SwimSwimHungry 6y ago
  This is quite spot on. Cryptocurrency lately has become this techbro version of a white-savior complex, where we think this magic technology will somehow uproot the lower lesser classes from their eternal toil and discord, yet I've seen plenty of these kinds of folks either not bother to get in on this (because it's likely too difficult to comprehend) or lose their shirt because they didn't make it on the right end of a transaction and lost more money to some cryptocurrency-rich fat cat, laughing all the way to the bank.
  - imwillofficial 6y ago
    “Techbro” “white savior complex” Do you actually talk like this or is it just the party line you spit out for virtue signaling points? I mean yeah, technology has magically elevated the toiling masses from shitty work. When was the last time you worked in a factory for 16 hours a day? When was the last time you got scurvy as a sailor on a wooden ship? When was the last time you tilled a field with the trusty family oxen?
    - SwimSwimHungry 6y ago
      I'm dead serious. Your comment seeks to discredit my position, but I'm speaking my truth to what I see. Sorry, but the bitcoin fans get condescending, acting like they can save us from those evil banks. Not a chance. Technology that has improved society does absolutely exist though, like the world wide web, which has proven potential and has revolutionized the way we do business and commerce. Cryptocurrency on the other hand is just an ancap wet dream. You are free to disagree with me, but bitcoin has been around for 12 years now and, yet, I see no killer application that doesn't involve some kind of grift. In the same period of 12 years, from the start of the WWW to around the early 2000s, so much innovation happened by comparison.
Lt_Riza_Hawkeye 6y ago
Aah yes, paying a $25 transaction fee to buy a $5 loaf of bread at the grocery store with bitcoin. Perfect.
Temasik 6y ago
just use USD facepalm

grumple 6y ago

> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight. Yeah, it's almost as though they had invested in Bitcoin during one of its crashes. What do you think they will say next time Bitcoin crashes back to 10% of its value?

retrac 6y ago
That they were foolish for holding onto Bitcoin itself. That's not what it's being used for. Here in the West there's basically no barriers for someone like me sending $10k or $10 million wherever, for whatever. Just ensure I pay any taxes on investment profits, and don't fund terrorists or drug cartels. Many countries are far more strict. E.g., Argentinians can only move $300 a month out of the country legally, as I understand it. If they want to purchase real estate in Canada or Australia as a hedge against inflation, for example, that can be very hard even if they have the funds. Getting around capital controls seems to be a niche for Bitcoin. I can think of few other ways to simply send $10,000 from Argentina to Nigeria in one hour, reliably and securely. Assuming people can exchange Bitcoin for cash or similar on both ends, it can be near-ideal for certain pairings compared to the legal and traditional financial system.
- logifail 6y ago
  > Getting around capital controls seems to be a niche for Bitcoin Q: If you pitch up in, say, Canada or Australia, and offer to buy a chunk of expensive real estate and pay with Bitcoin, who is selling? Q2: ... or do you have to convert to AUD/CAD first, and if so, which bank(s) can you rely on to not worry about KYC? Q3: ... or do you have to actually travel to Canada or Australia first, in order to open a regular bank account first, in order to have somewhere to move your Bitcoin to, in order to have local currency, in order to be able to pay the local seller?
  - retrac 6y ago
    I do know that people have transacted real estate in Bitcoin in Canada before, mostly as a gimmick, but no reason you couldn't do that legally on the Canadian end. But I assume one would convert to CAD. What's the problem with KYC on the Canadian bank end? Canada has no such controls and wouldn't care that the money was laundered out of Argentina. Even if you had to do that, laundering the funds into Canada unfortunately does not seem it would be difficult in practice, given the apparent scale of money-laundering associated with the Vancouver housing market. And you do not have to be physically present to acquire property in Canada.
    - logifail 6y ago
      > laundering the funds into Canada unfortunately does not seem it would be difficult in practice Is this true only if you're sufficiently under the radar, or does it still hold true no matter how big/famous/wanted a criminal you are? EDIT: see https://www.step.org/industry-news/canadian-citizens-challenge-fatca-enforcement-will-be-further-appealed https://www.step.org/industry-news/canadian-citizens-challen... and https://www.fintrac-canafe.gc.ca/guidance-directives/client-clientele/1-eng https://www.fintrac-canafe.gc.ca/guidance-directives/client-... ??
      - retrac 6y ago
        Of course some people get caught. (Though some of what I'm describing wouldn't be considered illegal under Canadian law in the first place. You can just buy property with BTC here if you have BTC.) Still, it's a huge problem: https://www.cbc.ca/news/canada/british-columbia/cullen-commission-money-laundering-bc-1.5583300 https://www.cbc.ca/news/canada/british-columbia/cullen-commi... https://globalnews.ca/news/7593419/bc-casinos-too-dangerous-cullen-commission/ https://globalnews.ca/news/7593419/bc-casinos-too-dangerous-...
- heavyset_go 6y ago
  Western Union operates all over the world, you can send money instantly and the fees are lower than Bitcoin's network fees for transactions.
- deleted 6y ago
  [deleted]

CamelCaseName 6y ago

Another reason why every asset is going up right now: https://fred.stlouisfed.org/series/PSAVERT https://fred.stlouisfed.org/series/PSAVERT Savings rates have exploded, and those funds need to go somewhere.

deathanatos 6y ago
Is the arrow of causality that way, though? I'm at the traditional "first-time-homebuyer" age, and I'm personally saving a fair portion of my income primarily because assets, such as houses, are so expensive. Were housing cheaper, I'd be paying a mortgage instead of a saving account. (And, I'd argue, sending longer doing so too due low interest rates.)
- CamelCaseName 6y ago
  It includes home purchases, so that would not be a factor. As per the earlier link: > Personal saving is equal to personal income less personal outlays and personal taxes; it may generally be viewed as the portion of personal income that is used either to provide funds to capital markets or to invest in real assets such as residences.(https://www.bea.gov/national/pdf/all-chapters.pdf https://www.bea.gov/national/pdf/all-chapters.pdf)
toinetoine 6y ago
Looking at both, it looks like the gradual decline in the savings rate since the early 1980s correlates with a gradual decline in inflation from that time: https://www.macrotrends.net/countries/USA/united-states/inflation-rate-cpi https://www.macrotrends.net/countries/USA/united-states/infl...

Grim-444 6y ago

There are other safe-havens against inflation which have existed for hundreds of years. Bitcoin didn't invent the concept of an inflation hedge, and the citizens you refer to had and still have standard alternate solutions. Which in all honesty are a lot safer than a digital collectible token with no intrinsic value that's primarily used for speculating and drug deals, which can be regulated, shut down, or taken over whenever your or another country wants to shut it down.

qertoip 6y ago
Bitcoin is by far the best hedge against inflation. All assets tend to zero in Bitcoin terms, long term. This has been true for the last 12 years and will continue to be true.
- CyberDildonics 6y ago
  This is groupthink propaganda nonsense. Bitcoin can only do 1.5KB/s of transactions and the average transaction costs $26. Any rapid decrease in price will lead to rapid decreases in mining and thus transaction throughput. Does this seem like the future of financial transactions to you?
  - scotty79 6y ago
    Transaction throughput doesn't depend on network hashrate. It gets adjusted to keep fixed througput.
    - CyberDildonics 6y ago
      In the short term it does. The block difficulty adjusts but not immediately. If hash rate drops rapidly, the time between blocks will lengthen, the time to adjustment will lengthen and the throughput will drop.
      - scotty79 6y ago
        Yes. Bitcoin adjust difficulty to hash rate every two weeks. So if you drop hashrate more rapidly than that you can have lower transactuon throughput for up to two weeks. One on average.

JumpCrisscross 6y ago

> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight At best, this argument turns Bitcoin into a massive subsidy by stable countries of unstable ones. A subsidy paid for in the form of higher energy prices, environmental damage and opportunity cost.

nikanj 6y ago

A car used to cost 2BTC, then 20BTC, and presently some 1BTC. Bitcoin isn’t exactly the model currency for stability.

nightski 6y ago
You achieve stability through diversification, not by buying all stable assets. It's kind of like saying you don't want to buy an index fund because there are some really volatile stocks in there!
- heterodoxxed 6y ago
  Remind me again, are we talking about an asset or a currency?
  - Closi 6y ago
    It depends what your argument is. If you are arguing that bitcoin is a bad currency because of high transfer fees, very few merchants accept it and that very few people are actually buying things with it in any meaningful way, then that's wrong because it's an asset. If you are arguing that as an asset it is purely speculative and has no fundamentals and zero return other than appreciation, then that's wrong because it's a store of value. If you are arguing that as a store of value it's actually highly volatile and has experienced multiple serious crashes, then that's wrong because it's actually a currency. This is the primary tactic Bitcoin seems to use to deploy to combat any criticism - if someone critiques its ability to do one thing you claim it's something else..
    - deleted 6y ago
      [deleted]
  - p_l 6y ago
    Depends on which problem of bitcoin they are currently defending.
  - nightski 6y ago

mtalantikite 6y ago

> Tell that to citizens of countries who have experienced hyperinflation and whose currencies became worthless almost overnight. I don’t think any of my family in Algeria are using Bitcoin, and same for my wife’s family in Bangladesh. In Algeria at least, generally you’ll go to a hawala money changer who gives you better rates than the banks and exchange your local currency into Euros. If you need to send money abroad you use the same old Islamic hawala system to send it to France or wherever else. There will probably be some useful things built on top of blockchains, and I don’t think crypto has zero value, but I don’t think it’s going to reasonably fix a situation of a failing state.

sneak 6y ago
How do you know the hawala systems aren’t at least partially based on Bitcoin now?

M277 6y ago

Yeah, and how many citizens of these countries buy and use BTC? Particularly with how unstable it is compared to other assets like e.g. gold. Mind you, I speak as someone who is a citizen in a country that experienced that. Not now, but back in 2016, our currency got halved. Nobody, and I mean absolutely nobody ever thought "I should have bought crypto." When the 2017-2018 crypto rush happened, and people started mining ETH, well-off people* here got onto it and started mining ETH.... only to immediately sell it as they mined. Nobody held onto it. *well-off because GPUs were absurdly expensive due to the inflation, and it only got worse when the shortages hit. EDIT: I also want to add that very, very few people here in my country actually understand what bitcoin even is (or cryptocurrency or blockchain). The people that I have seen support mining here only really view it as a way to earn some money while doing nothing.

SwimSwimHungry 6y ago
This is quite spot on. Cryptocurrency lately has become this techbro version of a white-savior complex, where we think this magic technology will somehow uproot the lower lesser classes from their eternal toil and discord, yet I've seen plenty of these kinds of folks either not bother to get in on this (because it's likely too difficult to comprehend) or lose their shirt because they didn't make it on the right end of a transaction and lost more money to some cryptocurrency-rich fat cat, laughing all the way to the bank.
- imwillofficial 6y ago
  “Techbro” “white savior complex” Do you actually talk like this or is it just the party line you spit out for virtue signaling points? I mean yeah, technology has magically elevated the toiling masses from shitty work. When was the last time you worked in a factory for 16 hours a day? When was the last time you got scurvy as a sailor on a wooden ship? When was the last time you tilled a field with the trusty family oxen?
  - SwimSwimHungry 6y ago
    I'm dead serious. Your comment seeks to discredit my position, but I'm speaking my truth to what I see. Sorry, but the bitcoin fans get condescending, acting like they can save us from those evil banks. Not a chance. Technology that has improved society does absolutely exist though, like the world wide web, which has proven potential and has revolutionized the way we do business and commerce. Cryptocurrency on the other hand is just an ancap wet dream. You are free to disagree with me, but bitcoin has been around for 12 years now and, yet, I see no killer application that doesn't involve some kind of grift. In the same period of 12 years, from the start of the WWW to around the early 2000s, so much innovation happened by comparison.

Lt_Riza_Hawkeye 6y ago

Aah yes, paying a $25 transaction fee to buy a $5 loaf of bread at the grocery store with bitcoin. Perfect.

Temasik 6y ago

just use USD facepalm