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A counterpoint would be that what some call the intrinsic value is the expected future share price based on expected future revenues. There might or might not b

• benreesman 5y ago
  FTX claims they buyback FTT based on financial results. Their business model has more historical precedent than e.g. Uber’s (and is arguably less legally grey). What difference am I missing?
• deleted 5y ago
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• shawabawa3 5y ago
  > but there is no revenue for a digital currency Isn't there? Ethereum kind of has revenue in that transaction fees for smart contract execution are burned (effectively a stock buyback) It has around ~$19B in revenue extrapolated at the current rate (although it's issuing more than $20B a year for now, planning to reduce issuance some time later this year)
  • pakitan 5y ago
    That's like MSFT issuing MicrosoftDollars to pay their dividents.
    • chollida1 5y ago
      Its not uncommon to pay dividends in comapany stock.
    • benreesman 5y ago
      The MicrosoftDollars they issue to pay their employees seem to be getting them some talent!
      • pakitan 5y ago
        Well, great then, they just need to apply the same strategy for their shareholders!
        • landemva 5y ago
          Crypto has this as a governance DAO with voting via the governance (sort of ownership) tokens. Lots of innovation happening.
    • DennisP 5y ago
      People spend fiat to buy ETH for transaction fees. Value is value. If the value of the transaction were less than the fee, they wouldn't transact.
• 10x-dev 5y ago
  How is digital currency, in general, anonymous? Bitcoin records all of your transactions, publicly, essentially forever. If at any point in time there is a way to tie your identity to _any_ of the transactions made in your lifetime, then all of your other transactions get deanonymized retroactively. Maybe you made a mistake, maybe a bug is introduced into the Bitcoin software, maybe the government passes a new law, etc. Cash doesn't have this issue. The bills I'm paying with when buying coffee at Starbucks, don't give you visibility into all of the purchases I've made with cash for the past 20 years. The only exception would be crypto like Monero, but it's not the rule. Bitcoin is the flagship coin which somehow got people to think it's anonymous. All it takes is for the government to require you to use the same wallet that's tied to your identity and then every citizen's transaction, past or future, is traceable to a degree that is just not possible with cash. That's a dangerous capability and we, the people, should make sure not to slowly end up in such a situation.
  • dougk16 5y ago
    Look into privacy coins like Monero.
    • spurgu 5y ago
      He mentions Monero.
  • jrm4 5y ago
    Right. I mean, basically you're as safe as your public-key/username. If you can make your wallet in some kind of very off grid way, the same way you'd have to use Tor; cash laptop, McDonald's wifi, etc.
    • ziml77 5y ago
      It doesn't matter how secretive you are when you create the wallet, that's not where the privacy issue lies. The problem comes from your use of the wallet. If you only use the wallet to pay for digital goods and only access those digital goods through multiple layers of protection, then you're probably fairly safe. But that's not very realistic. If bitcoin were to become the primary way to pay for things, you're going to be buying physical goods with it. If you order something online then they have your shipping address to associate with your wallet. If you buy something at a physical store then they can see you and know what wallet paid them. And lets say you maintain one wallet for the secret all-digital stuff and another wallet for everything else (or however many wallets makes sense for you), it's better that way, but all you have to do is slip up once with the secret wallet to be screwed. Everything you did with that secret wallet can now be associated with you even if the transaction happened 20 years ago.
• md_ 5y ago
  > A counterpoint would be that what some call the intrinsic value is the expected future share price based on expected future revenues. Sure, but plenty of tech companies have never paid dividends and never will. FB's shareholders would have legal claim to a portion of: a) a buyout (but nobody could afford to take FB private), b) a liquidation (so, you're buying in in case FB goes bankrupt), or c) future dividends (but FB's boy-king privileged stockholder doesn't want to pay dividends)... Which I think was Ben's point.
• upsidesinclude 5y ago
  Right, because cash has never afforded anonymity... always good enough for the government agencies. This is an entirely boring and tired trope. How about the simple ability to transfer value across international borders, free of extraneous % fees imposed by unnecessary middlemen? That alone is enough of a use case to justify adoption. Banks have reaped rewards unearned for long enough. Those capable and responsible enough to manage their affairs can do so
  • 01acheru 5y ago
    Uhm... there is something called law in most of the world which kind of regulate how and why you can or cannot send money across international borders, I will never understand that "crypto let us do it better than banks". You can send 10BTC to me, you're from Azerbaijan and I'm from France, all cool and nice until I want to cash out on that 10BTC... do you think I can receive 380k EUR on my bank without some government agency knocking on my door and accusing me of money laundering, asking me where this money comes from, asking me to pay taxes on it? If you are forbidden by law from sending money from A to B you cannot send it, either because you cannot send from A, you cannot receive in B, a mix of the two or whatever. You can send me crypto but since I cannot buy food with crypto I need to cash out sooner or later so that's end game. If you can send money from A to B it's way cheaper and more secure to send it using our current banking system. And BTW you pay a fee to turn money into crypto, in many cases you pay a fee to send crypto and lastly you pay another fee to turn that crypto back into money, sending crypto is not free.
    • chii 5y ago
      > If you are forbidden by law from sending money from A to B you cannot send it the crypto-dream (which, i admit is a nice outcome) is that no entity _could_ make such a transaction forbidden under a new regime of crypto finance. And it is true that today, some gov'ts can have an outsized effect over people that would not be under their juristiction - such as people in iran being sanctioned by the US. Unfortunately, crypto is hardly being used this way, nor will it be in the near to medium term future.
    • upsidesinclude 5y ago
• eric_cc 5y ago
  > it affords you anonymity What? Bitcoin is radically transparent. The vast majority of crimes are committed with standard currencies like $USD. If 'crime' is the only value you see, you're extremely ignorant. What is the bull case for $USD? What properties does it have that make it superior to currencies like $BTC in your opinion?
  • largbae 5y ago
    One thing fiat currencies have that is underrated: a legal system to handle special cases. Recently, an apparently Bitcoin-rich man named Mircea Propescu died without sharing his private key(s). Now that fortune is gone with no recourse for next of kin. Maybe this is OK and everyone is happy to lose the safety net. But what about fraud? Do you want to have to take up arms to get your money back from someone who stole from you?
    • joering2 5y ago
      For a starters, its not Bitcoin fault that someone did not have last will, or did not include the keys or their crypto in the last will. Second, when some large heist in the past happened on the chain, the largest exchanges announced they won't exchange proceeds from these addresses. It may still not be impossible to withdraw into fiat, but certainly it was harder. Eventually, there will be more regulation from US and other countries' bodies, some of it will benefit crypto holders, some inconvenience them some more. One example could be of a Government Body that oversees crypto fraud. If you had some coin stolen and you are able to prove they were yours and are unable to communicate with the party who took your coins, these assets can go into some form of public "coins on red notice list", where government puts them there, and exchanges can see the addresses and know not to accept or exchange these assets. If someone tries to, exchange can show them a notice information, instead of completing transaction. Another list government can maintain is "public call notice" (I'm just making these names up) similar to how public hearings are made. In this scenario, government can call up on an owner of some specific questionable coins to explain transactions behind. If no owner comes up in 30 days, these coins could be again put on "red notice" list. The bottom line is, since exchanges are regulated by governments, the governments will surely regulate even more. Ultimately because everything is transparent on a block chain, certain coins can become "dirty" just like money becomes tainted, and exchange or even possession of these coins can be made unlawful.
• fleddr 5y ago
  Cash is used for more crime than crypto. London city pretty much is the epicenter of money laundering and financial crime.
  • chii 5y ago
    Is it though? Cash may be more in absolute value terms, but in per dollar terms, is cash used more for crimes than regular transactions than crypto?
    • fleddr 5y ago
      Yes. There was a report about it recently. Don't have the link at hand.
• lvs 5y ago
  > there is no revenue for a digital currency. These debates get rehashed ad nauseum, but of course the same could be said of the USD, GBP, etc.. Currencies are exchanged to meet debt, contract, or tax obligations denominated in a particular currency. Trade is the common mode by which a currency has to be exchanged. For instance, if an American company buys British goods denominated in GBP, it will either exchange USD for GBP to close the transaction or borrow GBP that it must similarly pay back in GBP. The net result in either case is that it buys GBP and sells USD. If the UK government levies a duty/tax on the transaction, that too generates a demand for GBP requiring an exchange. Now it is of course somewhat unclear whether a significant economy exists in crypto that generates debts/taxes denominated in crypto that would create a steady/cyclical demand for crypto. It requires either that some productive center of the economy is demanding payment in crypto, or that governments are demanding tax payments in crypto, or both. If either is simply willing to accept multiple possible currencies, then demand flows through the most favorable path. Perhaps a modicum of anonymity is part of this calculus, but costs, difficulty, and risks also probably play a role. My point is that the economic analysis of your claims is more complicated. Buying currency serves a classical finance purpose that is unrelated to your analysis of equities. I think the climate and regulatory consequences of crypto are very serious, but I generally agree with those who say the credit/payments industry is predominantly parasitic. But those who say that no mechanism should exist to control the money supply based on economic conditions are just charlatans and simpletons and should be ignored.