4 ms·

I never really understood this reasoning, is it just simple envy? Ok, so a few folks will amass a lot of wealth based on luck and not merit. Those already exis

by hbrn 4y ago

I never really understood this reasoning, is it just simple envy? Ok, so a few folks will amass a lot of wealth based on luck and not merit. Those already exist in current financial system, both locally and globally. Plenty of dictators have control over natural resources worth trillions. There are numerous issues with bitcoin replacing USD, I'm just surprised why you think that few nerds becoming billionaires is a major one.

qwytw 4y ago
I'm sorry but I really I can't tell if you're being sarcastic or not, but I'll assume that you're not... > so a few folks will amass a lot of wealth based on luck and not merit You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky. Why would you want some random people controlling the majority of the global economy? I mean things are very far from perfect now in my opinion but at least most billionaires have earned their wealth through actual work in one way or the other and can be generally expected to behave rationally. The main issue in this case though is that bitcoin is deflationary. Obviously it's flawed but with Fiat money you're forced to either spend or invest your money returning it into the economy (also it's simply not physically feasible to hoard several billion (let alone trillion) of $ i a vault...). If you don't utilize your money somehow it will lose value continuously due to inflation. Bitcoin on the other hand will increase in value when the economy is growing (which is why using a commodity like gold which is still a magnitude or so so superior to bitcoin in this regard is and was a bad idea unless there are no stable governments). So hoarding money will become the safest and relatively best investment This means that these few folks will remain billionaires for ever and their wealth will keep increasing without them actually doing anything... There would be no or very few bank loans given out (imagine HUGE INTEREST RATES + HUGE DEFLATION, obviously not something that can exist now as long the people charger are not more than mildly insane...) venture capital, really any investment, which to be fair makes my last point moat cause there would be very little (or like negative) growth anyway in a such an economy. > I'm just surprised why you think that few nerds becoming billionaires is a major one So you want to take one of the biggest flaws of the current system and dial it up to 1000? Great idea...
- hbrn 4y ago
  > You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky Why don't you share the numbers then, what is significant in your mind? I can make the exact same claim about the current state of affairs. As far as I know, there are no privately owned wallets holding more than 0.5% of BTC.
  - qwytw 4y ago
    > Why don't you share the numbers then, what is significant in your mind IIRC there are no numbers. Because nobody really knows who owns what. Also if you had huge amounts of bitcoin why on earth would you hold all of it in single wallet? Makes no sense... > privately owned wallets holding more than 0.5% of BTC. Which is an astronomically huge amount for a private individual to own in case BTC replaces dollars. Even if we only count actual dollars bills in circulation that 0.5% of that would be 10.5 billion. What private person could have that much cash stored somewhere? And most importantly why? If we include entire M1 supply (bills + deposits) 0.5% would be equal to 100 BILLION dollars. That's not an amount that can exist in a single place in USD, no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time. That's not really possible.
    - hbrn 4y ago
      > no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time You seem to be confusing three similar, but fundamentally different things: physical cash, liquid assets, and being able to transfer in short period of time. Just because billionaire's assets are illiquid, it doesn't mean they can't transfer $10B in a short period of time. It simply means that portion of value will be lost during that transfer. > What private person could have that much cash stored somewhere? And most importantly why? Elon had $20B in cash (i.e. liquid assets) after selling 10% of his Tesla shares. He lost some value in the process, but afterwards he had $20B of liquid assets, which debunks your statement. Arguably, same will happen to $10B of BTC, given that such transaction(s) would be public and will raise concerns. And that's just Elon Musk, we're not even talking about western adversaries, like Putin or Xi, who have access to even more assets. And if we're thinking of BTC simply replacing physical cash, then you can even build fractional reserve system on top of it. Also, we seem to be discussing a magical world where BTC became the major currency overnight, with no time for financial system to adapt. If we go back to the real world, I could totally entertain a thought experiment of BTC replacing USD. Not that I support it, but again, few lucky billionaires is the least of my concerns, given that we already have those in the current system.

by hbrn 4y ago

qwytw 4y ago

I'm sorry but I really I can't tell if you're being sarcastic or not, but I'll assume that you're not... > so a few folks will amass a lot of wealth based on luck and not merit You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky. Why would you want some random people controlling the majority of the global economy? I mean things are very far from perfect now in my opinion but at least most billionaires have earned their wealth through actual work in one way or the other and can be generally expected to behave rationally. The main issue in this case though is that bitcoin is deflationary. Obviously it's flawed but with Fiat money you're forced to either spend or invest your money returning it into the economy (also it's simply not physically feasible to hoard several billion (let alone trillion) of $ i a vault...). If you don't utilize your money somehow it will lose value continuously due to inflation. Bitcoin on the other hand will increase in value when the economy is growing (which is why using a commodity like gold which is still a magnitude or so so superior to bitcoin in this regard is and was a bad idea unless there are no stable governments). So hoarding money will become the safest and relatively best investment This means that these few folks will remain billionaires for ever and their wealth will keep increasing without them actually doing anything... There would be no or very few bank loans given out (imagine HUGE INTEREST RATES + HUGE DEFLATION, obviously not something that can exist now as long the people charger are not more than mildly insane...) venture capital, really any investment, which to be fair makes my last point moat cause there would be very little (or like negative) growth anyway in a such an economy. > I'm just surprised why you think that few nerds becoming billionaires is a major one So you want to take one of the biggest flaws of the current system and dial it up to 1000? Great idea...

hbrn 4y ago
> You severely underestimate how concentrated bitcoin ownership is. A couple of hundred people would control a significant proportion of the global economy just because they were lucky Why don't you share the numbers then, what is significant in your mind? I can make the exact same claim about the current state of affairs. As far as I know, there are no privately owned wallets holding more than 0.5% of BTC.
- qwytw 4y ago
  > Why don't you share the numbers then, what is significant in your mind IIRC there are no numbers. Because nobody really knows who owns what. Also if you had huge amounts of bitcoin why on earth would you hold all of it in single wallet? Makes no sense... > privately owned wallets holding more than 0.5% of BTC. Which is an astronomically huge amount for a private individual to own in case BTC replaces dollars. Even if we only count actual dollars bills in circulation that 0.5% of that would be 10.5 billion. What private person could have that much cash stored somewhere? And most importantly why? If we include entire M1 supply (bills + deposits) 0.5% would be equal to 100 BILLION dollars. That's not an amount that can exist in a single place in USD, no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time. That's not really possible.
  - hbrn 4y ago
    > no single person does or ever did own such an amount in liquid assets which he could sell transfer the proceeds to someone in a short period of time You seem to be confusing three similar, but fundamentally different things: physical cash, liquid assets, and being able to transfer in short period of time. Just because billionaire's assets are illiquid, it doesn't mean they can't transfer $10B in a short period of time. It simply means that portion of value will be lost during that transfer. > What private person could have that much cash stored somewhere? And most importantly why? Elon had $20B in cash (i.e. liquid assets) after selling 10% of his Tesla shares. He lost some value in the process, but afterwards he had $20B of liquid assets, which debunks your statement. Arguably, same will happen to $10B of BTC, given that such transaction(s) would be public and will raise concerns. And that's just Elon Musk, we're not even talking about western adversaries, like Putin or Xi, who have access to even more assets. And if we're thinking of BTC simply replacing physical cash, then you can even build fractional reserve system on top of it. Also, we seem to be discussing a magical world where BTC became the major currency overnight, with no time for financial system to adapt. If we go back to the real world, I could totally entertain a thought experiment of BTC replacing USD. Not that I support it, but again, few lucky billionaires is the least of my concerns, given that we already have those in the current system.