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Coinbase’s fees are ridiculously high. By this is a symptom of a lack of competition and immaturity of the cryptocurrency space. The second issue is that crypt

Coinbase’s fees are ridiculously high. By this is a symptom of a lack of competition and immaturity of the cryptocurrency space. The second issue is that cryptocurrency is akin to a religion. This is also true. Most people buy and hold Bitcoin on the belief it will go up but there isn’t much of a reason for it to go up except a lot of people continuing to buy in and hold. As Peter Shiff and others have made clear Bitcoin is a naturally occurring Ponzi scheme.

mjfl 6y ago
but lack of competition is good for an investor :)
deleted 6y ago
[deleted]
asah 6y ago
You're looking at retail - their much bigger "wholesale" business has to compete on tighter margins. For example, when Tesla bought $1B via Coinbase, off market. Competitors are showing up fast. New opportunities are opening up in altcoins, staking and more.
Tenoke 6y ago
Lack of competition? Outside of the US you get 5+ times lower fees with an exchange with 9x the volume and offerings (Binance). Even in the US you can use e.g. Kraken which has lower fees. This author in particular didn't think it 'was worth the effort' to even use the actual market which offers 0.50% fees on Coinbase and went with the 1click solution that charges 1.49% for the convenience.
- Cthulhu_ 6y ago
  I also have an account on Kraken and for a layperson, it's really difficult to find out how much of what I have. For example. I can't get along with its UI. Coinbase however makes things super trivial / easy. It's a convenience fee.
mavhc 6y ago
There's 2 built in reasons for bitcoins to go up in price, the amount you get for mining keeps halving, and bitcoins get destroyed a lot. 3rd reason is the difficulty goes up if more people mine.
- Nursie 6y ago
  Mining difficulty does not push the price up, it's the other way round. Price drives up the profits of mining, and makes it viable to bring more capacity online. There is no mechanism by which difficulty drives the price.
  - Tenoke 6y ago
    >Mining difficulty does not push the price up, it's the other way round. Mining difficulty has little effect on the price. Halvings which the poster was talking about, however, also does not push the price up but rather reduces the rate of inflation.
    - mavhc 6y ago
      The actual cost of making a bitcoin is the cost of power, if the amount of power per bitcoin goes up, then the price will go up. The speculative price of bitcoins is ahead of the actual cost because it's very very likely to go up in the future as it becomes even more expensive to mine.
      - Nursie 6y ago
        You have it precisely backwards. If the price goes up then it becomes more profitable to mine, so it becomes viable to use more power. There is no mechanism by which the cost of mining affects the price.
        mavhc 6y ago
        If the cost of mining is higher than the price, then people won't mine, and the cost will go down. They're the same thing in the end, as long as you don't account for people paying more to get bitcoins now because they know they'll be more expensive in the future. So in the end the price of a bitcoin (not accounting for the future), will be exactly the cost of electricity to mine it. Once you account for the future however you realise if you buy now you're getting them cheap, which pushes up the price, and thus causes it to be more profitable to mine, which pushes up the cost of mining, which causes it to be less profitable to mine. The entire thing was designed by someone who took 1 economics class and thought inflation was a bad thing, so designed in multiple types of deflation, thus making it useless as a currency (who would ever sell a bitcoin?), and bring about the apocalypse faster
sixQuarks 6y ago
You’re quoting a guy who has become a laughing stock. I liked Shiff back in 2008 when he was right about the housing bubble, but it’s become apparent now that all he is now is a shill for gold, which his living depends on. I feel bad for all the people who followed his advise on bitcoin
- bhouston 6y ago
  But he was right about Bitcoin being a naturally occurring Ponzi scheme though.
  - sixQuarks 6y ago
    You could say the same for gold and for fiat money.
  - wp381640 6y ago
    How do I verify this claim as being correct?
wtf_is_up 6y ago
Peter Schiff FUD has traditionally been a buy signal. Funny that you can buy gold from him on SchiffGold.com with crypto. I wonder what he does with it.
- bhouston 6y ago
  Bitcoin is a naturally occurring Ponzi scheme at this moment though. It is pretty neat one.

mjfl 6y ago

but lack of competition is good for an investor :)

deleted 6y ago

[deleted]

asah 6y ago

You're looking at retail - their much bigger "wholesale" business has to compete on tighter margins. For example, when Tesla bought $1B via Coinbase, off market. Competitors are showing up fast. New opportunities are opening up in altcoins, staking and more.

Tenoke 6y ago

Lack of competition? Outside of the US you get 5+ times lower fees with an exchange with 9x the volume and offerings (Binance). Even in the US you can use e.g. Kraken which has lower fees. This author in particular didn't think it 'was worth the effort' to even use the actual market which offers 0.50% fees on Coinbase and went with the 1click solution that charges 1.49% for the convenience.

Cthulhu_ 6y ago
I also have an account on Kraken and for a layperson, it's really difficult to find out how much of what I have. For example. I can't get along with its UI. Coinbase however makes things super trivial / easy. It's a convenience fee.

mavhc 6y ago

There's 2 built in reasons for bitcoins to go up in price, the amount you get for mining keeps halving, and bitcoins get destroyed a lot. 3rd reason is the difficulty goes up if more people mine.

Nursie 6y ago
Mining difficulty does not push the price up, it's the other way round. Price drives up the profits of mining, and makes it viable to bring more capacity online. There is no mechanism by which difficulty drives the price.
- Tenoke 6y ago
  >Mining difficulty does not push the price up, it's the other way round. Mining difficulty has little effect on the price. Halvings which the poster was talking about, however, also does not push the price up but rather reduces the rate of inflation.
  - mavhc 6y ago
    The actual cost of making a bitcoin is the cost of power, if the amount of power per bitcoin goes up, then the price will go up. The speculative price of bitcoins is ahead of the actual cost because it's very very likely to go up in the future as it becomes even more expensive to mine.
    - Nursie 6y ago
      You have it precisely backwards. If the price goes up then it becomes more profitable to mine, so it becomes viable to use more power. There is no mechanism by which the cost of mining affects the price.
      - mavhc 6y ago
        If the cost of mining is higher than the price, then people won't mine, and the cost will go down. They're the same thing in the end, as long as you don't account for people paying more to get bitcoins now because they know they'll be more expensive in the future. So in the end the price of a bitcoin (not accounting for the future), will be exactly the cost of electricity to mine it. Once you account for the future however you realise if you buy now you're getting them cheap, which pushes up the price, and thus causes it to be more profitable to mine, which pushes up the cost of mining, which causes it to be less profitable to mine. The entire thing was designed by someone who took 1 economics class and thought inflation was a bad thing, so designed in multiple types of deflation, thus making it useless as a currency (who would ever sell a bitcoin?), and bring about the apocalypse faster

sixQuarks 6y ago

You’re quoting a guy who has become a laughing stock. I liked Shiff back in 2008 when he was right about the housing bubble, but it’s become apparent now that all he is now is a shill for gold, which his living depends on. I feel bad for all the people who followed his advise on bitcoin

bhouston 6y ago
But he was right about Bitcoin being a naturally occurring Ponzi scheme though.
- sixQuarks 6y ago
  You could say the same for gold and for fiat money.
- wp381640 6y ago
  How do I verify this claim as being correct?

wtf_is_up 6y ago

Peter Schiff FUD has traditionally been a buy signal. Funny that you can buy gold from him on SchiffGold.com with crypto. I wonder what he does with it.

bhouston 6y ago
Bitcoin is a naturally occurring Ponzi scheme at this moment though. It is pretty neat one.