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A good way of thinking about such arguments to get you some new insight into your own thinking about it is: "How does this argument about BTC[1] apply to gold?
by harry8 5y ago
A good way of thinking about such arguments to get you some new insight into your own thinking about it is:
"How does this argument about BTC[1] apply to gold?"
Eg is gold a ponzi scheme? "Dug up, refined, buried again somewhere like fort knox with a very small use other than as a store of value. (eg some electronics). Whether you decide yes it's ponzi or no it's not, then look at what other difference there is or isn't between gold and btc to justify the conclusion if that conclusion differs.
Or maybe like me you still haven't reached any conclusion about crypto-currencies beyond noting there are a lot of hucksters out there - just like in any goldrush.
[1] yes you can use some other cryptocurrency as your example and some other precious metal or stone such as diamonds or whatever if that is more useful to your thinking.
- Ologn 5y ago> Eg is gold a ponzi scheme? "Dug up, refined, buried again somewhere like fort knox with a very small use other than as a store of value. (eg some electronics). Whether you decide yes it's ponzi or no it's not, then look at what other difference there is or isn't between gold and btc to justify the conclusion if that conclusion differs. It is completely different. Gold is useful. For electronics. For filling teeth. For industrial uses. This is why gold is valuable. Gold also has properties that make it a good store of value and good currency. It is durable, portable, uniform, and divisible. That is why people "buried again somewhere like fort knox"..."as a store of value". Any commodity with these properties is treated in the same way (mostly other precious metals). If there is use value and exchange value, gold has both. Bitcoin currently has exchange value but it has no real use value. So they are not the same.
- Scaevolus 5y agoGold has been valued throughout human history for its beauty, and later as currency. Industrial applications are a very recent concern.
- randomhodler84 5y agoThe most important property of Bitcoin is it is digital, and can be transmitted over a communication channel. It requires no physical space. Private keys are easy to encrypt thus prevent access by unauthorized parties. It’s better than gold in every way. Why does anyone want shiny dumb rocks anyway?
- rvnx 5y agoEasy to lose the key yes.
- randomhodler84 5y ago“Lost coins only make everyone else's coins worth slightly more. Think of it as a donation to everyone.“ — Satoshi If you are going to donate coins to the cause, who am I to complain?
- HWR_14 5y agoPresumably, once enough keys are lost, the market will dry up. After all, how many times is the average person going to buy into a system they keep losing everything in.
- randomhodler84 5y agoThat is not a logical conclusion at all. The average person will do it enough times until they learn, or they will pay someone else to handle it. I am sad when people lose their coin, I would prefer it not to be lost.
- HWR_14 5y agoWhy on earth will they keep doing it? They might do it as many as two times, then chalk it up to being some computer scam and never trust it again. But, I cannot see anyone who buys in after 2018 ever buying in again if they lose their keys. Maybe if they bought in pre-2018 they believe in crypto as opposed to want to make money, so they try two times.
- lawrenceyan 5y ago> It is durable, portable, uniform, and divisible. That's exactly what crypto is too though isn't it?
- jfengel 5y agoIn a way, yes, gold is a Ponzi scheme. It trades out of proportion to any other inherent value. It does so because people decided, somewhat arbitrarily, that it made a good medium for denoting debts. (Not entirely arbitrary -- it's pretty, it's durable, it's rare but not too rare, etc.) It pretty much fills that niche completely. You don't need any more of them. Bitcoin could displace gold in that niche, except that there's no reason to pick that one over all of the others. The thing with gold is that its amount is really fixed, while cryptocurrencies magic themselves into existence every day. Even gold doesn't really fulfill that job any more. It's been displaced by fiat currencies whose "inherent value" is the land on which a government has control. If you want to live on that dirt, you deal with that currency. Gold ends up just being any other commodity, but with a history that makes it unique in a way no crypto can.