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> For Tesla, one single shareholder holds 17% of the whole company. If said investor abused his leverage to manipulate the stock value to dump his holding on u

by nuerow 5y ago

> For Tesla, one single shareholder holds 17% of the whole company. If said investor abused his leverage to manipulate the stock value to dump his holding on unwitting buyers prior to making it tank, he would be facing a prison sentence. In BTC that would be just another uneventful day.

capableweb 5y ago
The problem is that an investor that holds 17% has leverage. In Bitcoin, having a certain percentage of the supply means nothing really, and you can abuse a leverage that doesn't exist. It's more likely that the developers has leverage that could be abused, but then their own holdings would tank, so unlikely to happen.
- b112 5y ago
  Unless the goal is to attract independent / free market types, then after they invest, destroy BTC, thus reducing the economic might of the free thinking class...
csomar 5y ago
So what you are basically saying is that the stock market is not really a free market; and has arbitrary restrictions to make everything looks stable and legit. Okay.
- nuerow 5y ago
  > So what you are basically saying is that the stock market is not really a free market; and has arbitrary restrictions to make everything looks stable and legit. Okay. That makes as much sense as claiming that a free society isn't really free because you're subjected to arbitrary restrictions that punish you for stealing and embezzling.
- darkcha0s 5y ago
  I can't murder my neighbour, so you're saying we are not actually living in a free society
- toofy 5y ago
  I don’t think any serious person has ever implied the stock market has no regulations/protections. I mean, are you surprised that some things are illegal? Of course not, no one is surprised by this. Could you imagine what a clusterfuck the market would be with no regulations?
  - throw0101a 5y ago
    > Could you imagine what a clusterfuck the market would be with no regulations? Generally regulations are written after clusterfucks have occurred to reduce the risk of them happening again. It's the same reason we have building codes: after a Great Fire or two happens in a given city, fire breaks are usually mandated.
    - toofy 5y ago
      Absolutely. This is why in the digital currency realm we’ll absolutely see a repeat of many the exact same grifts over and over again that we’ve already gone through and already figured out how to mitigate. But we’ll just fall for them all over again. It’s amazing to me how many times we’re repeating the same mistakes over and over again that we’ve made in the relatively recent past because “it’ll be different this time because technology!” or whatever—and i don’t only mean in the coin sphere. I work, live, breathe, eat and play with technology however, quite a few people, usually those falling for marketing hype have deluded themselves pretty hard. Humanity scale chaotic complexity problems still exist and technology isn’t even close to solving those and won’t be for a long, long time.
      - gitfan86 5y ago
        It is the same reason you still see banner adds with a beautiful woman saying that she is looking for a hookup in your town. Also the reason we have lottery tickets and casinos and pyramid schemes. People logically know it is risky, but they want to give it a chance just in case this time is different.
- chalst 5y ago
  There is something like a global market in stock markets: capital trade gravitates to the "fittest" stock markets. And in the long term the fittest stock markets are without exceptions ones with transparency rules and rules protecting minority investors, where these rules are backed up by national laws that give these rules teeth. There's a reason for this: while in the short term dropping these rules gives flexibility, lower costs and the promise of new sources of profit, inevitably if unruly capital markets get big, small investors get screwed and a lot of investor wealth gets destroyed. We've seen this pattern a lot over the last two centuries. Simplistic free market ideology has a lot to answer for: successful markets need well-functioning institutions.
- lowdownfork 5y ago
  Those sound like non-arbitrary restrictions to make everything actually be stable and legit.
ianai 5y ago
I often wonder about this. How liquid are these coins? Ie if it’s a currency then converting every single coin to cash should result in no change to the conversion rate. If exchanging x coin to cash will net about the going rate, but ax results in dramatically less than a*conversion rate then it’s not a currency. If the difference is even further diminished it challenges the notion of it as a store of value. Edit-This would also provide people who want to cash a large amount of crypto to cash an incentive to prop up the value during their transaction period. Edit2-latest I can find, it was about $6.6 trillion dollars worth of daily forex activity back in 2019. Also note, this is cited as the biggest market in the world by trading volume. https://www.bis.org/statistics/rpfx19_fx.htm https://www.bis.org/statistics/rpfx19_fx.htm
- dkersten 5y ago
  > if it’s a currency then converting every single coin to cash should result in no change to the conversion rate Is that how it works for currency? I would think that if people tried to sell every single Euro for USD, the conversion rate would absolutely change.
  - gomox 5y ago
    It's not even remotely close to how it works for currency.
  - ianai 5y ago
    I did try to find a metric for what I was referring to here. It seems to be a number not easily found out about bitcoin. The size of the daily forex trading was around $6.6 trillion in 2019 - see my original comment for comparison. Realistically, I was thinking of trading cash for cash of one nationality- which absolutely wouldn't change the face denominated. Kind of tautological and not as helpful. Probably testing whether bitcoin to usd acts similarly to another foreign currency to usd may be a useful metric. But why do people exchange international currencies? So some are just forex traders performing intraday arbitrage. But the real/biggest use of it is to exchange goods across national borders. That's a use which cannot exist with the cryptos in quite the same way. Even if a nation adopts a crypto like bitcoin as its currency it does not have the same function as a currency backed by that government since bitcoin is controlled by other people - see the nber article referenced here. Edit - my main point remains about the exchange elasticity of crypto to usd/a national currency. If the exchange rate changes rapidly with the number of crypto exchanged then it's not very liquid, by definition, and not storing value nor acting like a currency.

by nuerow 5y ago

capableweb 5y ago

The problem is that an investor that holds 17% has leverage. In Bitcoin, having a certain percentage of the supply means nothing really, and you can abuse a leverage that doesn't exist. It's more likely that the developers has leverage that could be abused, but then their own holdings would tank, so unlikely to happen.

b112 5y ago
Unless the goal is to attract independent / free market types, then after they invest, destroy BTC, thus reducing the economic might of the free thinking class...

csomar 5y ago

So what you are basically saying is that the stock market is not really a free market; and has arbitrary restrictions to make everything looks stable and legit. Okay.

nuerow 5y ago
> So what you are basically saying is that the stock market is not really a free market; and has arbitrary restrictions to make everything looks stable and legit. Okay. That makes as much sense as claiming that a free society isn't really free because you're subjected to arbitrary restrictions that punish you for stealing and embezzling.
darkcha0s 5y ago
I can't murder my neighbour, so you're saying we are not actually living in a free society
toofy 5y ago
I don’t think any serious person has ever implied the stock market has no regulations/protections. I mean, are you surprised that some things are illegal? Of course not, no one is surprised by this. Could you imagine what a clusterfuck the market would be with no regulations?
- throw0101a 5y ago
  > Could you imagine what a clusterfuck the market would be with no regulations? Generally regulations are written after clusterfucks have occurred to reduce the risk of them happening again. It's the same reason we have building codes: after a Great Fire or two happens in a given city, fire breaks are usually mandated.
  - toofy 5y ago
    Absolutely. This is why in the digital currency realm we’ll absolutely see a repeat of many the exact same grifts over and over again that we’ve already gone through and already figured out how to mitigate. But we’ll just fall for them all over again. It’s amazing to me how many times we’re repeating the same mistakes over and over again that we’ve made in the relatively recent past because “it’ll be different this time because technology!” or whatever—and i don’t only mean in the coin sphere. I work, live, breathe, eat and play with technology however, quite a few people, usually those falling for marketing hype have deluded themselves pretty hard. Humanity scale chaotic complexity problems still exist and technology isn’t even close to solving those and won’t be for a long, long time.
    - gitfan86 5y ago
      It is the same reason you still see banner adds with a beautiful woman saying that she is looking for a hookup in your town. Also the reason we have lottery tickets and casinos and pyramid schemes. People logically know it is risky, but they want to give it a chance just in case this time is different.
chalst 5y ago
There is something like a global market in stock markets: capital trade gravitates to the "fittest" stock markets. And in the long term the fittest stock markets are without exceptions ones with transparency rules and rules protecting minority investors, where these rules are backed up by national laws that give these rules teeth. There's a reason for this: while in the short term dropping these rules gives flexibility, lower costs and the promise of new sources of profit, inevitably if unruly capital markets get big, small investors get screwed and a lot of investor wealth gets destroyed. We've seen this pattern a lot over the last two centuries. Simplistic free market ideology has a lot to answer for: successful markets need well-functioning institutions.
lowdownfork 5y ago
Those sound like non-arbitrary restrictions to make everything actually be stable and legit.

ianai 5y ago

I often wonder about this. How liquid are these coins? Ie if it’s a currency then converting every single coin to cash should result in no change to the conversion rate. If exchanging x coin to cash will net about the going rate, but ax results in dramatically less than a*conversion rate then it’s not a currency. If the difference is even further diminished it challenges the notion of it as a store of value. Edit-This would also provide people who want to cash a large amount of crypto to cash an incentive to prop up the value during their transaction period. Edit2-latest I can find, it was about $6.6 trillion dollars worth of daily forex activity back in 2019. Also note, this is cited as the biggest market in the world by trading volume. https://www.bis.org/statistics/rpfx19_fx.htm https://www.bis.org/statistics/rpfx19_fx.htm

dkersten 5y ago
> if it’s a currency then converting every single coin to cash should result in no change to the conversion rate Is that how it works for currency? I would think that if people tried to sell every single Euro for USD, the conversion rate would absolutely change.
- gomox 5y ago
  It's not even remotely close to how it works for currency.
- ianai 5y ago
  I did try to find a metric for what I was referring to here. It seems to be a number not easily found out about bitcoin. The size of the daily forex trading was around $6.6 trillion in 2019 - see my original comment for comparison. Realistically, I was thinking of trading cash for cash of one nationality- which absolutely wouldn't change the face denominated. Kind of tautological and not as helpful. Probably testing whether bitcoin to usd acts similarly to another foreign currency to usd may be a useful metric. But why do people exchange international currencies? So some are just forex traders performing intraday arbitrage. But the real/biggest use of it is to exchange goods across national borders. That's a use which cannot exist with the cryptos in quite the same way. Even if a nation adopts a crypto like bitcoin as its currency it does not have the same function as a currency backed by that government since bitcoin is controlled by other people - see the nber article referenced here. Edit - my main point remains about the exchange elasticity of crypto to usd/a national currency. If the exchange rate changes rapidly with the number of crypto exchanged then it's not very liquid, by definition, and not storing value nor acting like a currency.