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> But I think at this point we know that all cryptocurrencies are ‘greater fool’ “investments” It seems to me to be very apparent that we do not all know that.

by Joeboy 5y ago

> But I think at this point we know that all cryptocurrencies are ‘greater fool’ “investments” It seems to me to be very apparent that we do not all know that. It is in fact a point of significant controversy.

louwrentius 5y ago
I don’t think so. It’s quite simple: where do the profits come from? Other people, who by definition will lose money because crypto doesn’t create value. A large amount of people will hold the bags of worthless currencies while a few laugh their asses off in their lambo’s.
- xiphias2 5y ago
  El Salvador's Bitcoin Beach project is a great example of people profiting from a debit based value network instead of a credit based financial system: even though both US and El Salvador had USD as the legal tender, it took $10 to remit $50 through the western union network. Lightning network (which is using Bitcoin as a settlement network) is both dramatically lowering the fees and provides instant debit transfer from an El Salvadorian living in US remitting money to his/her parents in their village (or directly paying the rent / gas bills) instead of the parents needing to travel hours by bus to the city.
  - nootropicat 5y ago
    LN isn't actually used - the way it actually works is: Strike holds dollars for the user. The user wants to send dollars to someone. Strike buys btc using dollars (from itself), sends btc via ln - to itself - and then sells btc for the same amount of dollars, again to itself, and credits the receiver. What's actually happening is that Strike is a normal payment provider like Paypal, Venmo, Revolut that fakes the btc transfer process because pretending to be only a btc wallet means less regulation than a full payment provider. They don't actually spell it as directly - they just claim an absurdity that buying btc and then selling btc is somehow cheaper than a direct transfer, which of course is impossible because it means taking the ask and then selling into the bid, and the actual spread on most liquid btc markets can be observed on biggest exchanges like Coinbase or Binance, and that's ignoring the fact that one part of the exchange is supposed to happen in a local illiquid market in El Salvador. The whole thing would be less convoluted if stablecoin tokens were sent directly using a payment channel without a fake trade step - using btc is a completely pointless for anything but marketing (Strike to btc holders and marketing btc itself).
    - SV_BubbleTime 5y ago
      I read that twice and now it makes less sense. What is the purpose of the fake transfer steps?
      - axiosgunnar 5y ago
        > because pretending to be only a btc wallet means less regulation than a full payment provider.
    - xiphias2 5y ago
      You are totally right in each step, but there's 1 thing that makes it different from most exchanges: you can already transfer money in/out of it using LN, which makes it much more practical than using a Coinbase exchange account. Also, while Coinbase Pro has a 0.1-0.3% fee for market order, if you want guaranteed execution, Coinbase and its competitors take 3-4%. If you listened to talks from Jack Mallers, he was tracking lnd head instead of waiting for the full releases, and picking and testing pull requests by hand, fixing bugs that come up in practice (or giving feedback to lightning devs), that's one of Strike's advantages over other exchanges. Also the ,,less regulation'' is just not true generally, people have to go through KYC to link with bank accounts, they are communicating with regulators: https://jimmymow.medium.com/announcing-strike-public-beta-325877a79f87 https://jimmymow.medium.com/announcing-strike-public-beta-32...
- Joeboy 5y ago
  > I don’t think so But the fact you don't disagree with yourself doesn't mean other people don't disagree with you.
- echopurity 5y ago
  >where do the profits come from? Every heard a money printer go brrr?

by Joeboy 5y ago

louwrentius 5y ago

I don’t think so. It’s quite simple: where do the profits come from? Other people, who by definition will lose money because crypto doesn’t create value. A large amount of people will hold the bags of worthless currencies while a few laugh their asses off in their lambo’s.

xiphias2 5y ago
El Salvador's Bitcoin Beach project is a great example of people profiting from a debit based value network instead of a credit based financial system: even though both US and El Salvador had USD as the legal tender, it took $10 to remit $50 through the western union network. Lightning network (which is using Bitcoin as a settlement network) is both dramatically lowering the fees and provides instant debit transfer from an El Salvadorian living in US remitting money to his/her parents in their village (or directly paying the rent / gas bills) instead of the parents needing to travel hours by bus to the city.
- nootropicat 5y ago
  LN isn't actually used - the way it actually works is: Strike holds dollars for the user. The user wants to send dollars to someone. Strike buys btc using dollars (from itself), sends btc via ln - to itself - and then sells btc for the same amount of dollars, again to itself, and credits the receiver. What's actually happening is that Strike is a normal payment provider like Paypal, Venmo, Revolut that fakes the btc transfer process because pretending to be only a btc wallet means less regulation than a full payment provider. They don't actually spell it as directly - they just claim an absurdity that buying btc and then selling btc is somehow cheaper than a direct transfer, which of course is impossible because it means taking the ask and then selling into the bid, and the actual spread on most liquid btc markets can be observed on biggest exchanges like Coinbase or Binance, and that's ignoring the fact that one part of the exchange is supposed to happen in a local illiquid market in El Salvador. The whole thing would be less convoluted if stablecoin tokens were sent directly using a payment channel without a fake trade step - using btc is a completely pointless for anything but marketing (Strike to btc holders and marketing btc itself).
  - SV_BubbleTime 5y ago
    I read that twice and now it makes less sense. What is the purpose of the fake transfer steps?
    - axiosgunnar 5y ago
      > because pretending to be only a btc wallet means less regulation than a full payment provider.
  - xiphias2 5y ago
    You are totally right in each step, but there's 1 thing that makes it different from most exchanges: you can already transfer money in/out of it using LN, which makes it much more practical than using a Coinbase exchange account. Also, while Coinbase Pro has a 0.1-0.3% fee for market order, if you want guaranteed execution, Coinbase and its competitors take 3-4%. If you listened to talks from Jack Mallers, he was tracking lnd head instead of waiting for the full releases, and picking and testing pull requests by hand, fixing bugs that come up in practice (or giving feedback to lightning devs), that's one of Strike's advantages over other exchanges. Also the ,,less regulation'' is just not true generally, people have to go through KYC to link with bank accounts, they are communicating with regulators: https://jimmymow.medium.com/announcing-strike-public-beta-325877a79f87 https://jimmymow.medium.com/announcing-strike-public-beta-32...
Joeboy 5y ago
> I don’t think so But the fact you don't disagree with yourself doesn't mean other people don't disagree with you.
echopurity 5y ago
>where do the profits come from? Every heard a money printer go brrr?