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What? All of crypto is Fundamentally based on more money coming into the ecosystem. It is all cashflow negative.

nailer 4y ago
So asset classes depend on demand? Well done for understanding this. Not sure why you're picking on digital currency though.
- gitfan86 4y ago
  No, cashflow positive assets generate returns. The idea that a cashflow positive asset could have no demand means that the dividend yield could be infinity. Which is a ridiculous idea. On the other hand a cashflow negative asset like crypto can easily go to zero when the demand is at or below the cashflow cost.
  - nailer 4y ago
    Why is cryptocurrency mysteriously unique in not being able to generate cash flow? I can use cryptocurrency as gold, as cash, as a savings account, or artwork, all of which very obviously generate returns.
    - gitfan86 4y ago
      Speculation and trading are zero sum. The only way people made money on beanie babies was by finding a greater fool to sell to.
      - nailer 4y ago
        I know. Are you going to respond to the comment you're replying to?
        gitfan86 4y ago
        You said that "fundamentals remain solid". If you had said cash or beanie babies had solid fundamentals I would have singled those out explained that they don't.
    - snapcaster 4y ago
      None of those things generate returns what are you talking about? do you know what cash flow or returns means?
Animats 4y ago
Crypto doesn't have fundamentals.
- nailer 4y ago
  Every asset class does. USD has the US military, gold has difficulty of mining, crypto has maths, watches have complexity of their construction and are a lightweight store of value, art has emotional resonance.
  - benj111 4y ago
    Difficulty of mining is a supply side constraint.it doesn't give gold its value. Gold has long been prized because it doesn't corrode, and makes nice jewelry. There's also industrial applications. Who admires the maths of their bitcoin? They don't, it's just a supply constraint. Constraining the supply of something that has no value doesn't make it worth something though. Likewise you probably need a military to defend your country from those who might invade and replace the currency, but that doesn't impart value.
    - lizknope 4y ago
      https://www.sciencehistory.org/distillations/aluminum-common-metal-uncommon-past https://www.sciencehistory.org/distillations/aluminum-common... Aluminum used to be more valuable than gold. Then we discovered cheaper ways of processing the ore. Aluminum is so cheap now that people throw away aluminum cans everyday (hopefully in the recycling bin) People rarely throw away gold like that although some does get tossed in electronic devices. If we found a way to decrease the cost of gold mining by 1000X then maybe people would throw it away like aluminum.
      - tschwimmer 4y ago
        You folks are arguing past each other. As it turns out, the price of something is determined by two factors: Supply and Demand. Imbalances in supply and demand cause changes in price.
      - 4y ago

So asset classes depend on demand? Well done for understanding this. Not sure why you're picking on digital currency though.

gitfan86 4y ago
No, cashflow positive assets generate returns. The idea that a cashflow positive asset could have no demand means that the dividend yield could be infinity. Which is a ridiculous idea. On the other hand a cashflow negative asset like crypto can easily go to zero when the demand is at or below the cashflow cost.
- nailer 4y ago
  Why is cryptocurrency mysteriously unique in not being able to generate cash flow? I can use cryptocurrency as gold, as cash, as a savings account, or artwork, all of which very obviously generate returns.
  - gitfan86 4y ago
    Speculation and trading are zero sum. The only way people made money on beanie babies was by finding a greater fool to sell to.
    - nailer 4y ago
      I know. Are you going to respond to the comment you're replying to?
      - gitfan86 4y ago
        You said that "fundamentals remain solid". If you had said cash or beanie babies had solid fundamentals I would have singled those out explained that they don't.
  - snapcaster 4y ago
    None of those things generate returns what are you talking about? do you know what cash flow or returns means?

Animats 4y ago

Crypto doesn't have fundamentals.

nailer 4y ago
Every asset class does. USD has the US military, gold has difficulty of mining, crypto has maths, watches have complexity of their construction and are a lightweight store of value, art has emotional resonance.
- benj111 4y ago
  Difficulty of mining is a supply side constraint.it doesn't give gold its value. Gold has long been prized because it doesn't corrode, and makes nice jewelry. There's also industrial applications. Who admires the maths of their bitcoin? They don't, it's just a supply constraint. Constraining the supply of something that has no value doesn't make it worth something though. Likewise you probably need a military to defend your country from those who might invade and replace the currency, but that doesn't impart value.
  - lizknope 4y ago
    https://www.sciencehistory.org/distillations/aluminum-common-metal-uncommon-past https://www.sciencehistory.org/distillations/aluminum-common... Aluminum used to be more valuable than gold. Then we discovered cheaper ways of processing the ore. Aluminum is so cheap now that people throw away aluminum cans everyday (hopefully in the recycling bin) People rarely throw away gold like that although some does get tossed in electronic devices. If we found a way to decrease the cost of gold mining by 1000X then maybe people would throw it away like aluminum.
    - tschwimmer 4y ago
      You folks are arguing past each other. As it turns out, the price of something is determined by two factors: Supply and Demand. Imbalances in supply and demand cause changes in price.
    - 4y ago