4 ms·

That's obviously wrong if the price keeps going up like it has.

user-the-name 5y ago
Not at all. The state of the market does not affect this in any way whatsoever. The only thing that changes when the price changes is who wins and who loses. But on average, you always lose, this is an inescapable fact.
- perl4ever 5y ago
  If there are two people, and one bitcoin in the world, and one person buys the bitcoin for $1 and sells it to the other person for $2, who has lost money?
  - marcosdumay 5y ago
    Up to now, the second person is $2 short.
    - perl4ever 5y ago
      That seems to privilege dollars as more "real" than crypto in some way. Or is the point that between quotes in an illiquid market, everything is worthless?
      - user-the-name 5y ago
        Both of these are true, but not necessary for the argument. "One bitcoin in the world traded once" is an extreme edge case where the normally negligible factors dominate the calculation. Consider instead that there is one bitcoin, that one hundred people sell to each other in a long chain, for varying prices, playing a small fee each time. If you add up the cash inflow and outflows, you will get a net negative per person equal to the average fee paid.
        perl4ever 5y ago
        >If you add up the cash inflow and outflows, you will get a net negative per person equal to the average fee paid If no theft was involved, then you can't have a net negative number for total cash flows, can you? The fees went somewhere.
        user-the-name 5y ago
        There are two things that exist outside the regular trading: First, exchanges skim a fee off the top of every transaction. That removes some money from the analysis, causing a negative sum. Second, miners are a special case: They do not deposit any money, they only withdraw it using freshly minted coins. Thus they too skim off some of the value in the market, and also cause the sum of the regular trades to be negative.
    - lexapro 5y ago
      They are $2 short but own one bitcoin that might be worth $50,000 to someone else. If I buy a car for $20,000 I'm $20,000 short but I also own a car.
      - user-the-name 5y ago
        And when that person does buy it for $50000, we are in the exact same situation, but now the missing money is $50000 rather than $2.
        perl4ever 5y ago
        There is no such thing as a continuous market. Everything, even stocks that are being traded at a high frequency, has moments when it is not being traded. If continuous markets were somehow realized, then moments when value is "missing" per your definition could be rare. But instead, there are infinite non-trading moments between each pair of trades, so "nearly all" of the time your definition says an asset is worthless. That just seems like a useless, inappropriate definition from a practical perspective. https://en.wikipedia.org/wiki/Null_set https://en.wikipedia.org/wiki/Null_set

Not at all. The state of the market does not affect this in any way whatsoever. The only thing that changes when the price changes is who wins and who loses. But on average, you always lose, this is an inescapable fact.

perl4ever 5y ago
If there are two people, and one bitcoin in the world, and one person buys the bitcoin for $1 and sells it to the other person for $2, who has lost money?
- marcosdumay 5y ago
  Up to now, the second person is $2 short.
  - perl4ever 5y ago
    That seems to privilege dollars as more "real" than crypto in some way. Or is the point that between quotes in an illiquid market, everything is worthless?
    - user-the-name 5y ago
      Both of these are true, but not necessary for the argument. "One bitcoin in the world traded once" is an extreme edge case where the normally negligible factors dominate the calculation. Consider instead that there is one bitcoin, that one hundred people sell to each other in a long chain, for varying prices, playing a small fee each time. If you add up the cash inflow and outflows, you will get a net negative per person equal to the average fee paid.
      - perl4ever 5y ago
        >If you add up the cash inflow and outflows, you will get a net negative per person equal to the average fee paid If no theft was involved, then you can't have a net negative number for total cash flows, can you? The fees went somewhere.
        user-the-name 5y ago
        There are two things that exist outside the regular trading: First, exchanges skim a fee off the top of every transaction. That removes some money from the analysis, causing a negative sum. Second, miners are a special case: They do not deposit any money, they only withdraw it using freshly minted coins. Thus they too skim off some of the value in the market, and also cause the sum of the regular trades to be negative.
  - lexapro 5y ago
    They are $2 short but own one bitcoin that might be worth $50,000 to someone else. If I buy a car for $20,000 I'm $20,000 short but I also own a car.
    - user-the-name 5y ago
      And when that person does buy it for $50000, we are in the exact same situation, but now the missing money is $50000 rather than $2.
      - perl4ever 5y ago
        There is no such thing as a continuous market. Everything, even stocks that are being traded at a high frequency, has moments when it is not being traded. If continuous markets were somehow realized, then moments when value is "missing" per your definition could be rare. But instead, there are infinite non-trading moments between each pair of trades, so "nearly all" of the time your definition says an asset is worthless. That just seems like a useless, inappropriate definition from a practical perspective. https://en.wikipedia.org/wiki/Null_set https://en.wikipedia.org/wiki/Null_set