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So your answer to the statement that most blockchain technology is exploitation of verbal ambiguity and appeal to emotion is... verbal ambiguity and appeal to e

So your answer to the statement that most blockchain technology is exploitation of verbal ambiguity and appeal to emotion is... verbal ambiguity and appeal to emotion? The claim is that there is no traditional valuation model that assigns any value to cryptocurrencies. The only way to refute it is to show that yes, such a valuation model exists. Until then, it's Goop but for tech.

cslarson 5y ago
Cryptocurrency (dumb term) just means token - it is a very broad concept. Tokens can have stable value pegged to a fiat, or represent share of a company, or a non-fungible item like a house, or a fungible share of a house, or claim on profits from a financial protocol, or memecoin, or a way to pay for transactions. Of course traditional valuation models can be assigned - it just depends on the characteristics of the token in question.
- jw1224 5y ago
  Exactly this. I see so many people conflating NFTs with “expensive JPEGs”… No, an NFT is a cryptographically-secured representation of ownership of an economic asset. Yes… It also happens that there’s a ton of money being ploughed into weird, niche, expensive digital art. But this has now created an economic market in a space where previously one was not possible, by virtue of the fact you could never prove something was original, unique, or “yours”.
  - groby_b 5y ago
    Except most digital art lacks provenance in the first place, so you paid for a cryptographically-secured link to a bunch of bits somebody claims are original. (It turns out an https link on a domain you own does the same work) The lack of provable provenance means that a good chunk of NFT "art" is actually stolen from the artists who do the work. Bored Ape demonstrated that the theft of NFT art is easy, and the supposed ironclad ownership can easily be changed by the sites listing the art work - because they can just decide that those ironclad bits you hold aren't really yours. At which point you have a central authority arbitrating ownership, which is even worse than what the art world has right now. It's certainly a lovely place for all sorts of cons, but as economic asset or cryptographic representation of ownership it is an utter and complete failure. You still can't prove something's original, unique, or yours. It just has a thin veneer of technobabble to hide that fact.
TomSwirly 5y ago
> The only way to refute it is to show that yes, such a valuation model exists. Ah, a rational person. Yes, I thought that argument would be unbeatable, but the counter-argument goes like this: "Valuation models are worthless because all money is imaginary anyway." It's really hard to refute someone who says that, like it's hard to refute someone who believes the world is entirely imaginary.
- jw1224 5y ago
  If we didn’t have currency, our only means of exchange would be through bartering: I have food, you have clothes. I need clothes, and you need food. I’ll swap you 5 bags of corn for 3 pairs of socks. Do we have a deal? >> The only way to refute it is to show that yes, such a valuation model exists. It’s complex and inconvenient to barter all day long. So, “we” (society) created a “token” (e.g. USD) to represent the value of our economic goods. I believe 5 bags of corn is worth about $10. You believe 3 pairs of socks is also worth about $10. Now we have a deal, unambiguously, because we have a mutually-agreed asset from which we can both continue to derive value in other markets. So, both statements are true: “all money is imaginary” — because it has no inherent value (OK… I guess I can wipe my ass with it, or light a fire… but I can’t feed or clothe myself with a $10 bill). But, at the same time, it’s not worthless — as we mutually agree to assign it worth, on the basis that others are willing to do so too. > It's really hard to refute someone who says that There’s a good reason it’s hard to refute this… because it’s a fundamental economic principle! As more and more people “agree” that Bitcoin has value, its value grows. A mutually-agreed representation of value (i.e. a “valuation model”), therefore, exists.

cslarson 5y ago

Cryptocurrency (dumb term) just means token - it is a very broad concept. Tokens can have stable value pegged to a fiat, or represent share of a company, or a non-fungible item like a house, or a fungible share of a house, or claim on profits from a financial protocol, or memecoin, or a way to pay for transactions. Of course traditional valuation models can be assigned - it just depends on the characteristics of the token in question.

jw1224 5y ago
Exactly this. I see so many people conflating NFTs with “expensive JPEGs”… No, an NFT is a cryptographically-secured representation of ownership of an economic asset. Yes… It also happens that there’s a ton of money being ploughed into weird, niche, expensive digital art. But this has now created an economic market in a space where previously one was not possible, by virtue of the fact you could never prove something was original, unique, or “yours”.
- groby_b 5y ago
  Except most digital art lacks provenance in the first place, so you paid for a cryptographically-secured link to a bunch of bits somebody claims are original. (It turns out an https link on a domain you own does the same work) The lack of provable provenance means that a good chunk of NFT "art" is actually stolen from the artists who do the work. Bored Ape demonstrated that the theft of NFT art is easy, and the supposed ironclad ownership can easily be changed by the sites listing the art work - because they can just decide that those ironclad bits you hold aren't really yours. At which point you have a central authority arbitrating ownership, which is even worse than what the art world has right now. It's certainly a lovely place for all sorts of cons, but as economic asset or cryptographic representation of ownership it is an utter and complete failure. You still can't prove something's original, unique, or yours. It just has a thin veneer of technobabble to hide that fact.

TomSwirly 5y ago

> The only way to refute it is to show that yes, such a valuation model exists. Ah, a rational person. Yes, I thought that argument would be unbeatable, but the counter-argument goes like this: "Valuation models are worthless because all money is imaginary anyway." It's really hard to refute someone who says that, like it's hard to refute someone who believes the world is entirely imaginary.

jw1224 5y ago
If we didn’t have currency, our only means of exchange would be through bartering: I have food, you have clothes. I need clothes, and you need food. I’ll swap you 5 bags of corn for 3 pairs of socks. Do we have a deal? >> The only way to refute it is to show that yes, such a valuation model exists. It’s complex and inconvenient to barter all day long. So, “we” (society) created a “token” (e.g. USD) to represent the value of our economic goods. I believe 5 bags of corn is worth about $10. You believe 3 pairs of socks is also worth about $10. Now we have a deal, unambiguously, because we have a mutually-agreed asset from which we can both continue to derive value in other markets. So, both statements are true: “all money is imaginary” — because it has no inherent value (OK… I guess I can wipe my ass with it, or light a fire… but I can’t feed or clothe myself with a $10 bill). But, at the same time, it’s not worthless — as we mutually agree to assign it worth, on the basis that others are willing to do so too. > It's really hard to refute someone who says that There’s a good reason it’s hard to refute this… because it’s a fundamental economic principle! As more and more people “agree” that Bitcoin has value, its value grows. A mutually-agreed representation of value (i.e. a “valuation model”), therefore, exists.