4 ms·

You can’t print gold. …

by dcow 5y ago

lottin 5y ago
During the gold standard central banks would engage in sterilising operations to prevent large fluctuations in the money supply, which was the equivalent of open market operations in modern central banking (what some people call "printing money")
dragontamer 5y ago
But you can go to 'India', conquer the Aztecs, steal all their gold and silver, and depress the European gold economy for the next century. ----- You can also subtly alter the composition of your gold and silver coins to leverage your reputation and squeeze more money out of your gold reserves. Turns out that most people don't have a habit of checking the density of gold coins. As long as they weigh the same, you can trick the scales. 500 years ago, they'd mix cheaper metals into their coins. Today, we'd just use tungsten, which has very similar density to gold.
- dcow 5y ago
  You can do the first thing with a chain coin but I don’t think you can do the second.
  - dragontamer 5y ago
    For Blockchain, you just invent a new coin (DOGE, Shibu, whatever). Every new Blockchain is a new group of people printing a trillion / quadrillion crypto tokens and throwing into the market. As long as cryptofans buy up new coins or NFTs, you can keep printing new tokens.
    - lowkey 5y ago
      “A fool and his money are soon parted” Fool’s gold has always been a thing. Similarly, there will always be some who cannot distinguish between Bitcoin and the latest dog coin. Few Bitcoiners are selling Bitcoin to buy NFTs or altcoins.
      - rglullis 5y ago
        What are they selling it for?
        lowkey 5y ago
        Most are Hodling. The rest are selling for USD or USDT mostly is my guess
        rglullis 5y ago
        So basically, no one is actually buying the story of "digital gold" or "store of value". They are either playing the game of greater fool, or trying to cash out of it. Call me back when Bitcoiners actually start using the thing as a currency. At least that was more interesting.
        lowkey 5y ago
        Call me confused, but my understanding is that pretty much everyone is currently using it as digital gold, a store of value, a powerful hedge against inflation. Why is store-of-value not a valid use case, especially with central banks printing money so aggressively? Who cares if it is used as currency? It is used by millions and that's what matters. As long as governments insist on taxing Bitcoin as property, it will never be a medium of exchange. As long as it continues to grow at 10-20x the S&P500, it will not be used as a unit of account. So what? It is a $1 Trillion asset class that has proven itself as a store of value over the past 12 years. It offers unique technology, game theory and network effects relative to all alternatives and it is protected by a forcefield of hashpower called Proof-of-work that is impenetrable to even nation-state level attacks. Bitcoin is amazing. I believe it is the most remarkable innovation of the 21st century. Prove me wrong. Tell me about a superior innovation invented this century.
        rglullis 5y ago
        > everyone is currently using it as digital gold, a store of value, a powerful hedge against inflation. You and I have a different idea of "everyone" means, but anyway... > Why is store-of-value not a valid use case Because if it's value depends on a large number of people agreeing to its value, then it's not a store of value. All it takes is for the miners to decide to dedicate their resources to something more profitable, and suddenly the network is worth zero. > It offers unique technology. It's so unique, it has spun how many forks already? > It is a $1 Trillion asset class that has proven itself as a store of value over the past 12 years. You are literally using circular logic here. > Tell me about a superior innovation invented this century. "Blockchain, not Bitcoin". ;) And even blockchain still needs to prove itself. I believe it can be very useful for some cases, and I am working to see it succeed. I just don't think that "digital gold" is one of those cases. BTC was a good prototype. That's it. We should continue in the drawing board instead of pretending that we have a finished product in our hands. BTC already failed as a currency, the activists and cypherpunks that first got into it would be mortified to see how now current proponents end up cheering for a dictator in a Banana Republic that is pushing "their" coin. The "digital gold" narrative switch was an attempt to save it and now we are all playing this game of "Emperor has no clothes" with something because some people are trying to be rich without building any wealth.
    - whiskyant 5y ago
      Holds true as long as "cryptofans buy up new coins". But eventually, they won't. For these types of get-rich-quick gamblers, they usually shift their money around to the next thing, but an equal amount of them lose their money as well. Those that invest in Bitcoin tend to be more conservative, and are more willing to hold their coins and use it as a long term investment/store of value. They aren't easily convinced a new coin can replace Bitcoin either.
joering2 5y ago
Well, technically you can. You can "print" gold by using other elements with simply changing number of protons to match 79. I believe this has been done already, if my memory serves me right reading some article years ago. Its just that the cost of doing so even on small scale overweight the cost of the resulting gold, even if the price would be of a 10-fold what it is today. tldr: its possible, just not worth it.
- dcow 5y ago
  Ha, yeah technically you can grind the chain too, but it requires unreasonable amounts of resources.
- hutrdvnj 5y ago
  But it's interesting, because it sets an upper limit for the gold price.
  - reginold 5y ago
    Yes very interesting. Gold was originally formed within supernovae, which is a sure sign that our planet is formed from molecules that have been through at least one or two supernovae already. Another fund gold fact, the reason gold appears in "veins" is that it's actually big blobs, but over time water runs through the blob, dragging along little bits of dust with it down the same channel. Those little bits of dust build up and become veins of gold.
bradwood 5y ago
You can't print bitcoin, but you can mine more gold.

You can’t print gold. …

by dcow 5y ago

You can’t print gold. …

During the gold standard central banks would engage in sterilising operations to prevent large fluctuations in the money supply, which was the equivalent of open market operations in modern central banking (what some people call "printing money")

dragontamer 5y ago

But you can go to 'India', conquer the Aztecs, steal all their gold and silver, and depress the European gold economy for the next century. ----- You can also subtly alter the composition of your gold and silver coins to leverage your reputation and squeeze more money out of your gold reserves. Turns out that most people don't have a habit of checking the density of gold coins. As long as they weigh the same, you can trick the scales. 500 years ago, they'd mix cheaper metals into their coins. Today, we'd just use tungsten, which has very similar density to gold.

dcow 5y ago
You can do the first thing with a chain coin but I don’t think you can do the second.
- dragontamer 5y ago
  For Blockchain, you just invent a new coin (DOGE, Shibu, whatever). Every new Blockchain is a new group of people printing a trillion / quadrillion crypto tokens and throwing into the market. As long as cryptofans buy up new coins or NFTs, you can keep printing new tokens.
  - lowkey 5y ago
    “A fool and his money are soon parted” Fool’s gold has always been a thing. Similarly, there will always be some who cannot distinguish between Bitcoin and the latest dog coin. Few Bitcoiners are selling Bitcoin to buy NFTs or altcoins.
    - rglullis 5y ago
      What are they selling it for?
      - lowkey 5y ago
        Most are Hodling. The rest are selling for USD or USDT mostly is my guess
        rglullis 5y ago
        So basically, no one is actually buying the story of "digital gold" or "store of value". They are either playing the game of greater fool, or trying to cash out of it. Call me back when Bitcoiners actually start using the thing as a currency. At least that was more interesting.
        lowkey 5y ago
        Call me confused, but my understanding is that pretty much everyone is currently using it as digital gold, a store of value, a powerful hedge against inflation. Why is store-of-value not a valid use case, especially with central banks printing money so aggressively? Who cares if it is used as currency? It is used by millions and that's what matters. As long as governments insist on taxing Bitcoin as property, it will never be a medium of exchange. As long as it continues to grow at 10-20x the S&P500, it will not be used as a unit of account. So what? It is a $1 Trillion asset class that has proven itself as a store of value over the past 12 years. It offers unique technology, game theory and network effects relative to all alternatives and it is protected by a forcefield of hashpower called Proof-of-work that is impenetrable to even nation-state level attacks. Bitcoin is amazing. I believe it is the most remarkable innovation of the 21st century. Prove me wrong. Tell me about a superior innovation invented this century.
        rglullis 5y ago
        > everyone is currently using it as digital gold, a store of value, a powerful hedge against inflation. You and I have a different idea of "everyone" means, but anyway... > Why is store-of-value not a valid use case Because if it's value depends on a large number of people agreeing to its value, then it's not a store of value. All it takes is for the miners to decide to dedicate their resources to something more profitable, and suddenly the network is worth zero. > It offers unique technology. It's so unique, it has spun how many forks already? > It is a $1 Trillion asset class that has proven itself as a store of value over the past 12 years. You are literally using circular logic here. > Tell me about a superior innovation invented this century. "Blockchain, not Bitcoin". ;) And even blockchain still needs to prove itself. I believe it can be very useful for some cases, and I am working to see it succeed. I just don't think that "digital gold" is one of those cases. BTC was a good prototype. That's it. We should continue in the drawing board instead of pretending that we have a finished product in our hands. BTC already failed as a currency, the activists and cypherpunks that first got into it would be mortified to see how now current proponents end up cheering for a dictator in a Banana Republic that is pushing "their" coin. The "digital gold" narrative switch was an attempt to save it and now we are all playing this game of "Emperor has no clothes" with something because some people are trying to be rich without building any wealth.
  - whiskyant 5y ago
    Holds true as long as "cryptofans buy up new coins". But eventually, they won't. For these types of get-rich-quick gamblers, they usually shift their money around to the next thing, but an equal amount of them lose their money as well. Those that invest in Bitcoin tend to be more conservative, and are more willing to hold their coins and use it as a long term investment/store of value. They aren't easily convinced a new coin can replace Bitcoin either.

joering2 5y ago

Well, technically you can. You can "print" gold by using other elements with simply changing number of protons to match 79. I believe this has been done already, if my memory serves me right reading some article years ago. Its just that the cost of doing so even on small scale overweight the cost of the resulting gold, even if the price would be of a 10-fold what it is today. tldr: its possible, just not worth it.

dcow 5y ago
Ha, yeah technically you can grind the chain too, but it requires unreasonable amounts of resources.
hutrdvnj 5y ago
But it's interesting, because it sets an upper limit for the gold price.
- reginold 5y ago
  Yes very interesting. Gold was originally formed within supernovae, which is a sure sign that our planet is formed from molecules that have been through at least one or two supernovae already. Another fund gold fact, the reason gold appears in "veins" is that it's actually big blobs, but over time water runs through the blob, dragging along little bits of dust with it down the same channel. Those little bits of dust build up and become veins of gold.

bradwood 5y ago

You can't print bitcoin, but you can mine more gold.