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Mathematician here - one who has been paid to write successful option models for Wall Street, for example. Your argument is wildly wrong because you cannot add
by TomSwirly 4y ago
Mathematician here - one who has been paid to write successful option models for Wall Street, for example.
Your argument is wildly wrong because you cannot add negative numbers and make a positive. You simply invent random transactions to come up with a desired outcome, and refuse to look at the big picture.
The whole cryptomarket is a negative sum game, because of the costs of electricity, bandwidth and personnel. For every dollar that goes into the whole cryptocurrency market to buy a coin, less than a dollar comes out, because some of that money is buying mining rigs and generator plants.
This is certain because there is a law of conservation of money in this case. Cryptocurrency neither creates nor destroys fiat currency, so the inputs and outputs have to net equal less than zero.
Why don't you try to come up with some sequence of actual transactions in a "toy" market with a small enough number of participants that you can work through it by hand, not forgetting to take out money from the pot for electricity, network, and personnel? You'll soon see that this network net destroys money - it doesn't create it.
If you don't believe it, I'll write you a math proof, but TBH if you don't understand the explanation above, you'll understand the math proof even less.
- cjg 4y agoHere's a simple model: A market of one token that was initially worth nothing 1 year ago but the market now sees has value - let's say $100 - because it has some genuine utility - various companies have said they will accept it as payment for a variety of different products. If you add all the cashflows for trading on this token over the year, $100 has been made. In fact the only way for these cashflows to sum to zero is for the token to be worth zero. Where did that value come from? It came from the increased utility of the token.