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A lot of people got into Bitcoin early as well, but tried to build the wrong things. For example I built an ebay clone in 2013. It was never obvious at all. Pr

A lot of people got into Bitcoin early as well, but tried to build the wrong things. For example I built an ebay clone in 2013. It was never obvious at all. Practically all predictions were wrong. Even the predictions by bitcoin advocates of all stripes were wrong. Everyone was wrong. It is just that some people won big despite being wrong. I don't think Brain Armstrong foresaw that Bitcoin would turn into what it is today either. In any case, building an exchange seems pretty hard. I wouldn't know where to start with all the legal stuff.

thathndude 6y ago
This is obvious just by looking at the labels. We continue to call these cryptocurrency, and that was what Armstrong saw. But in practice the only narrative that gets any real traction (and makes any sense) for BTC is the digital gold narrative and store of value.
- ObserverNeutral 6y ago
  People are scared as hell of inflation and that's why the Fed was created. The "stable prices" thing is an elegant way to say "prevent inflation". Now people are really upset that the Fed won't allow deflation and is pretty much encouraging inflation. They see this as a betrayal to the public and the reason why the Fed was created in the first place. There is a misalignment between the Fed inflation preference of 2% and the public inflation preference which is 0% or even -2% Enter BTC: what draws people to crypto is deflation. People love deflation, they gravitate towards crypto because deflation is hard built in protocol and it brings about financial nirvana for the saver: that is being able to increase one's net worth without doing any tangible work, manual or intellectual.
  - maxwell 6y ago
    How much deflation is good? The point of Friedman-style 2% inflation seems to be to steadily, but not abruptly, drive up prices, increasing wages, increasing demand. I see the personal, anti-social case for "giving in to our greed", as the time traveler put it [1], but what are the social benefits of lowering production, wages, demand? 1. https://www.reddit.com/r/Bitcoin/comments/1lfobc/i_am_a_timetraveler_from_the_future_here_to_beg/1 https://www.reddit.com/r/Bitcoin/comments/1lfobc/i_am_a_time...
    - ObserverNeutral 6y ago
      The time traveler post is really great . But the most absolutely bit is the "giving in to our greed" : "Why didn't we abandon Bitcoin, and move to another system? Well, we tried of course. We tried to step over to an inflationary cryptocurrency, but nobody with an IQ above 70 was willing to step up first and volunteer. After all, why would you voluntarily invest a lot of your money into a currency where you know your wealth will continually decline? The thing that made Bitcoin so dangerous to society was also what made it so successful. Bitcoin allows us to give into our greed." The whole social benefits thing that we somehow had up to now was pure luck. If bitcoin hodlers keep a low profile and don't spend there would not be any way to identify them and redistribute wealth. This is especially true for those who mined btc.
      - deleted 6y ago
        [deleted]
base698 6y ago
Not everyone was wrong. Hal Finney called it early as pointed out in "The Bitcoin Standard". > While this view of Bitcoin might sound like it is a betrayal of Bitcoin's original vision of fully peer‐to‐peer cash, it is not a new vision. Hal Finney, the recipient of the first Bitcoin transaction from Nakamoto, wrote this on the Bitcoin forum in 2010: Actually there is a very good reason for Bitcoin‐backed banks to exist, issuing their own digital cash currency, redeemable for bitcoins. Bitcoin itself cannot scale to have every single financial transaction in the world be broadcast to everyone and included in the block chain. There needs to be a secondary level of payment systems which is lighter weight and more efficient. Likewise, the time needed for Bitcoin transactions to finalize will be impractical for medium to large value purchases. Bitcoin backed banks will solve these problems. They can work like banks did before nationalization of currency. Different banks can have different policies, some more aggressive, some more conservative. Some would be fractional reserve while others may be 100% Bitcoin backed. Interest rates may vary. Cash from some banks may trade at a discount to that from others. George Selgin has worked out the theory of competitive free banking in detail, and he argues that such a system would be stable, inflation resistant and self‐regulating.
- mustafa_pasi 6y ago
  He is still talking about a situation where people are trying to use Bitcoin as a currency and the technical challenges they'd face in that scenario. Bitcoin as currency did not fail because of technical issues. It failed because the financial incentives to use it as such are not there.
agumonkey 6y ago
There's something very weird about this, since birth there were many beliefs (BTC will succeed when ATMs will be in bitcoin) that people followed, most of them ended up false but BTC and it's crowd is still going. Out of the wrong emerged a new true.

thathndude 6y ago

This is obvious just by looking at the labels. We continue to call these cryptocurrency, and that was what Armstrong saw. But in practice the only narrative that gets any real traction (and makes any sense) for BTC is the digital gold narrative and store of value.

ObserverNeutral 6y ago
People are scared as hell of inflation and that's why the Fed was created. The "stable prices" thing is an elegant way to say "prevent inflation". Now people are really upset that the Fed won't allow deflation and is pretty much encouraging inflation. They see this as a betrayal to the public and the reason why the Fed was created in the first place. There is a misalignment between the Fed inflation preference of 2% and the public inflation preference which is 0% or even -2% Enter BTC: what draws people to crypto is deflation. People love deflation, they gravitate towards crypto because deflation is hard built in protocol and it brings about financial nirvana for the saver: that is being able to increase one's net worth without doing any tangible work, manual or intellectual.
- maxwell 6y ago
  How much deflation is good? The point of Friedman-style 2% inflation seems to be to steadily, but not abruptly, drive up prices, increasing wages, increasing demand. I see the personal, anti-social case for "giving in to our greed", as the time traveler put it [1], but what are the social benefits of lowering production, wages, demand? 1. https://www.reddit.com/r/Bitcoin/comments/1lfobc/i_am_a_timetraveler_from_the_future_here_to_beg/1 https://www.reddit.com/r/Bitcoin/comments/1lfobc/i_am_a_time...
  - ObserverNeutral 6y ago
    The time traveler post is really great . But the most absolutely bit is the "giving in to our greed" : "Why didn't we abandon Bitcoin, and move to another system? Well, we tried of course. We tried to step over to an inflationary cryptocurrency, but nobody with an IQ above 70 was willing to step up first and volunteer. After all, why would you voluntarily invest a lot of your money into a currency where you know your wealth will continually decline? The thing that made Bitcoin so dangerous to society was also what made it so successful. Bitcoin allows us to give into our greed." The whole social benefits thing that we somehow had up to now was pure luck. If bitcoin hodlers keep a low profile and don't spend there would not be any way to identify them and redistribute wealth. This is especially true for those who mined btc.
    - deleted 6y ago
      [deleted]

base698 6y ago

Not everyone was wrong. Hal Finney called it early as pointed out in "The Bitcoin Standard". > While this view of Bitcoin might sound like it is a betrayal of Bitcoin's original vision of fully peer‐to‐peer cash, it is not a new vision. Hal Finney, the recipient of the first Bitcoin transaction from Nakamoto, wrote this on the Bitcoin forum in 2010: Actually there is a very good reason for Bitcoin‐backed banks to exist, issuing their own digital cash currency, redeemable for bitcoins. Bitcoin itself cannot scale to have every single financial transaction in the world be broadcast to everyone and included in the block chain. There needs to be a secondary level of payment systems which is lighter weight and more efficient. Likewise, the time needed for Bitcoin transactions to finalize will be impractical for medium to large value purchases. Bitcoin backed banks will solve these problems. They can work like banks did before nationalization of currency. Different banks can have different policies, some more aggressive, some more conservative. Some would be fractional reserve while others may be 100% Bitcoin backed. Interest rates may vary. Cash from some banks may trade at a discount to that from others. George Selgin has worked out the theory of competitive free banking in detail, and he argues that such a system would be stable, inflation resistant and self‐regulating.

mustafa_pasi 6y ago
He is still talking about a situation where people are trying to use Bitcoin as a currency and the technical challenges they'd face in that scenario. Bitcoin as currency did not fail because of technical issues. It failed because the financial incentives to use it as such are not there.

agumonkey 6y ago

There's something very weird about this, since birth there were many beliefs (BTC will succeed when ATMs will be in bitcoin) that people followed, most of them ended up false but BTC and it's crowd is still going. Out of the wrong emerged a new true.