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If I buy Monero using dollars and use the Monero to transact anonymously, what have I lost without realizing it?

mjburgess 4y ago
What did you buy with that Monero? Sure, if you can exchange coins for goods consistently, then the value of that basket of goods is the value of the coin. ie., take a BTC and go to every store, across the economy, and exchange it for goods. Do that until you've spent all the BTC. Divide by the number of BTC, and that's a reasonable estimate of the value. However, since you can't do that... and, indeed, doing anything even remotely similar would immedaitely crash the price... there's no basis on which to value crypto. There doesnt seem any rational basis on which anyone would trade 1 BTC (etc.) for anything. The only reason BTC has a nominal price is that it can't actually be consistenly exchanged, by holders, for goods; and holders are strongly discouraged from doing so by its deflationary design. Were such opporunities actually presented, tomorrow 1BTC would buy a car, next week a vodka, the week after a pack of gum
- cowtools 4y ago
  I don't think it's a fair comparison. monero (and almost every other modern cryptocurrency) has reasonable fees due to its dynamic blocksize. Additionally, the tokenomics of monero are somewhat inflationary as of last month, they've activated a constant block reward. The development of BTC as a payment system are very complicated. There was a long period from 2017 where you've had two competing mechanisms for low-fee payments: BCH (Bitcoin Cash, fork to increase blocksize), and BTC-LN (Bitcoin Lightning network, gossip network of multisig accounts). This really fragmented the userbase and slowed down BTC's adoption as a payment system. I'm not saying comparisons to BTC are meaningless, I'm just saying that BTC is a bad example of a "typical cryptocurrency".
cowtools 4y ago
As much as I like XMR, you have to admit that you are still paying the (albeit very competitive and CPU-based) miners for verifying your transaction, in both the transaction fee and inflation due to tail emission.

What did you buy with that Monero? Sure, if you can exchange coins for goods consistently, then the value of that basket of goods is the value of the coin. ie., take a BTC and go to every store, across the economy, and exchange it for goods. Do that until you've spent all the BTC. Divide by the number of BTC, and that's a reasonable estimate of the value. However, since you can't do that... and, indeed, doing anything even remotely similar would immedaitely crash the price... there's no basis on which to value crypto. There doesnt seem any rational basis on which anyone would trade 1 BTC (etc.) for anything. The only reason BTC has a nominal price is that it can't actually be consistenly exchanged, by holders, for goods; and holders are strongly discouraged from doing so by its deflationary design. Were such opporunities actually presented, tomorrow 1BTC would buy a car, next week a vodka, the week after a pack of gum

cowtools 4y ago
I don't think it's a fair comparison. monero (and almost every other modern cryptocurrency) has reasonable fees due to its dynamic blocksize. Additionally, the tokenomics of monero are somewhat inflationary as of last month, they've activated a constant block reward. The development of BTC as a payment system are very complicated. There was a long period from 2017 where you've had two competing mechanisms for low-fee payments: BCH (Bitcoin Cash, fork to increase blocksize), and BTC-LN (Bitcoin Lightning network, gossip network of multisig accounts). This really fragmented the userbase and slowed down BTC's adoption as a payment system. I'm not saying comparisons to BTC are meaningless, I'm just saying that BTC is a bad example of a "typical cryptocurrency".

cowtools 4y ago

As much as I like XMR, you have to admit that you are still paying the (albeit very competitive and CPU-based) miners for verifying your transaction, in both the transaction fee and inflation due to tail emission.