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> ... and a lousy store of value I expect this to be true eventually, but so far Bitcoin has been doing OK as a store of value. Unless people bought in the rel

by roenxi 3y ago

> ... and a lousy store of value I expect this to be true eventually, but so far Bitcoin has been doing OK as a store of value. Unless people bought in the relatively short peaks, HODLers aren't losing crazy amount of money and one could reasonably anticipate that it'll reach $60k/bitcoin again in the near future. There seem to be people convinced that the crypto types are coming out a long way behind but I'm not really seeing it in the prices. It isn't as stable as the gold market, but it is easy to draw loose comparisons and acquiring/storing crypto is a lot more normal-person-friendly. It also looks like a strong bet in politically uncertain situations; if there is one asset I'd want when fleeing a country it'd be crypto.

CJefferson 3y ago
"crypto types" isn't just bitcoin, and most crypto currencies, and most NFTs have crashed to basically zero. You are right that bitcoin, and a couple of others, are staying strong.
- roenxi 3y ago
  The effect though, by natural flows, is the things are collapsing are almost automatically the fringe plays. At worst, soon forgotten. Something similar happens in the stock market, the winners are so large and win so hard that the losers are almost irrelevant. All the crypto I own are behaving with downright steady prices. It has been a boring ride for me so far. The risk of me losing large value quickly seems to have more to do with my questionable key-keeping practices than the market.
- j_maffe 3y ago
  > most crypto currencies, and most NFTs have crashed to basically zero. That's just plain untrue.
ljf 3y ago
I was talking to a very pro-crypto friend - part of my (sour grapes) issue with Bitcoin is that is actually a pretty impractical way to purchase items day to day - but he pointed out that this is more of a feature than a bug. He likened it to buying and selling physical gold as a store of value, I hadn't thought of it that way before. I am still stinging from not buying in when I first became aware of it (approx. $1 at the time) - but I honestly could have bought in at any point of the last 10 years (except the highs of 2021) and still come out in profit.
- lawn 3y ago
  There's a large amount of copium regarding this. In no way is it a feature that Bitcoin transactions are expensive. At best it's a negative that that's acceptable given the other benefits.
- Analemma_ 3y ago
  > but he pointed out that this is more of a feature than a bug -- he likened it to buying and selling physical gold as a store of value This is a lot of cope and ex post facto justification. "Store of value which can't actually be used for real-world transactions" was absolutely not the rallying cry for Bitcoin for its first many years of existence, and people only pivoted to that when it became undeniable that Bitcoin was not fit for its original intended purpose. If it serves the new purpose well enough, then great, but don't let your friend fool you that everything is going completely according to plan.
  - throw0101c 3y ago
    > This is a lot of cope and ex post facto justification. First sentence of the original paper: > Abstract. A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. […] * https://bitcoin.org/bitcoin.pdf https://bitcoin.org/bitcoin.pdf
  - petertodd 3y ago
    > and people only pivoted to that when it became undeniable that Bitcoin was not fit for its original intended purpose. These days it is likely(1) that the majority of Bitcoin transactions by number(2) are being done via the layer 2 system Lightning, which does have nearly instant payments and low fees. Transactions via Lightning are not recorded on the blockchain, even though you can easily hold funds in a non-custodial way. I happen to be in El Salvador at the moment, and with the exception of the Chivo Bitcoin ATMs run by the government, every single vendor selling things for Bitcoin has accepted Lightning. 1) It's hard to know for sure, as Lightning transactions have quite good privacy, so it's difficult to get estimates of how many there are in total. But decent lower-bound estimates exist: https://bitcoinmagazine.com/markets/lightning-network-sees-record-adoption-amidst-new-applications https://bitcoinmagazine.com/markets/lightning-network-sees-r... 2) Of course, by value it's very likely that on-chain transactions dominate, as there are lots of very high value, multi-million+, transactions out there.
fdkjhasdf 3y ago
> ...Unless people bought in the relatively short peaks... That's a bit minimalistic, no? The "short peak" of $50-60k (around 50-100% more than the current value) lasted something like 6 months AFAIK? To be a store of value, you would hope those fluctuations would be nonexistant. Store of value should be for everyone, not just the unlucky ones...
this_user 3y ago
> but so far Bitcoin has been doing OK as a store of value No, it hasn't. A store of value is supposed to be stable, it's about volatility. By that same reasoning you could argue that Apple or Tesla stock, or even the stock market in general, is a great store of value. But nobody would ever call it that, because it is far too volatile on a daily basis. Trying to argue that a vague long-term uptrend in prices makes something a store of value is just more intellectually dishonest cope by cryptobros who are desperate to defend this useless technology.
- seydor 3y ago
  Volatile compared to what? Dollars. The us government is able to steer dollar as it likes but that comes with violence, it's not "naturally" stable
- josu 3y ago
  >a vague long-term uptrend in prices makes something a store of value A stable and 100% predetermined issuance schedule, along with its scarcity, it's what makes Bitcoin a good store of value. The steady uptrend in prices is the consequence. >useless technology. Just because it's functionality is limited it doesn't make it useless. A store of value that doesn't require boring the planet, or building empty houses, seems like a great improvement to me. I think that you are conflating the cryptobro culture, with the true value that Bitcoin brings to the table.
  - skulk 3y ago
    > A store of value that doesn't require boring the planet, or building empty houses, seems like a great improvement to me. Boring holes isn't tenable but using 15 GW of power is acceptable?
    - siftrics 3y ago
      Energy will continue to get cheaper and less scarce over the long term. This is a bad argument.
    - josu 3y ago
Geee 3y ago
People confuse a lot of things about volatility, risk, and long term valuation. Bitcoin is an inherently good long term store of value, because it has deterministic and finite inflation schedule, which is also plausibly immutable (contrary to fiat cryptocurrencies, called "cryptos"). On the other hand, fiat currencies are a lousy store of value, because they have non-deterministic, but always positive inflation schedule, i.e. they are guaranteed to lose value in the long term. These are just objective facts about their inherent properties. In addition, Bitcoin includes cryptographic property protection, making it a better store of value in jurisdictions where local authorities won't provide property protection, or the cost of property protection is high. For example, in many countries, it's illegal to own US dollars. Bitcoin is easier to hide and use discreetly, compared to anything physical. Volatility is a property of the market, not a property of the asset. All things considered, bitcoin should get less and less volatile when time goes on, assuming that it continues gaining adoption. Which is given, as it doesn't have any competition.
- siftrics 3y ago
  > contrary to fiat cryptocurrencies, called "cryptos" This is wrong. No one says this.
  - tnel77 3y ago
    It’s pretty common in the Bitcoin community.
- theorytheory22 3y ago
  You're missing the forest through the trees. Bitcoin doesn't have value beyond what can be converted into real currency. Real currency is used to buy things. BTC isn't. The currency-BTC market IS the entire value of Bitcoin. None of the other stuff matters, because BTC is solely denominated in actual currencies. BTC is non-inflationary? Doesn't matter. You only use it to buy USD or actual currencies. If there's less demand for BTC, BTC value goes down. And guess what? Demand is fickle. The cyrptographic property protection is ok in theory. But try and point out somebody it's helped? And by that I mean a non-criminal/extortionist/money launderer.

by roenxi 3y ago

CJefferson 3y ago

"crypto types" isn't just bitcoin, and most crypto currencies, and most NFTs have crashed to basically zero. You are right that bitcoin, and a couple of others, are staying strong.

roenxi 3y ago
The effect though, by natural flows, is the things are collapsing are almost automatically the fringe plays. At worst, soon forgotten. Something similar happens in the stock market, the winners are so large and win so hard that the losers are almost irrelevant. All the crypto I own are behaving with downright steady prices. It has been a boring ride for me so far. The risk of me losing large value quickly seems to have more to do with my questionable key-keeping practices than the market.
j_maffe 3y ago
> most crypto currencies, and most NFTs have crashed to basically zero. That's just plain untrue.

ljf 3y ago

I was talking to a very pro-crypto friend - part of my (sour grapes) issue with Bitcoin is that is actually a pretty impractical way to purchase items day to day - but he pointed out that this is more of a feature than a bug. He likened it to buying and selling physical gold as a store of value, I hadn't thought of it that way before. I am still stinging from not buying in when I first became aware of it (approx. $1 at the time) - but I honestly could have bought in at any point of the last 10 years (except the highs of 2021) and still come out in profit.

lawn 3y ago
There's a large amount of copium regarding this. In no way is it a feature that Bitcoin transactions are expensive. At best it's a negative that that's acceptable given the other benefits.
Analemma_ 3y ago
> but he pointed out that this is more of a feature than a bug -- he likened it to buying and selling physical gold as a store of value This is a lot of cope and ex post facto justification. "Store of value which can't actually be used for real-world transactions" was absolutely not the rallying cry for Bitcoin for its first many years of existence, and people only pivoted to that when it became undeniable that Bitcoin was not fit for its original intended purpose. If it serves the new purpose well enough, then great, but don't let your friend fool you that everything is going completely according to plan.
- throw0101c 3y ago
  > This is a lot of cope and ex post facto justification. First sentence of the original paper: > Abstract. A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution. […] * https://bitcoin.org/bitcoin.pdf https://bitcoin.org/bitcoin.pdf
- petertodd 3y ago
  > and people only pivoted to that when it became undeniable that Bitcoin was not fit for its original intended purpose. These days it is likely(1) that the majority of Bitcoin transactions by number(2) are being done via the layer 2 system Lightning, which does have nearly instant payments and low fees. Transactions via Lightning are not recorded on the blockchain, even though you can easily hold funds in a non-custodial way. I happen to be in El Salvador at the moment, and with the exception of the Chivo Bitcoin ATMs run by the government, every single vendor selling things for Bitcoin has accepted Lightning. 1) It's hard to know for sure, as Lightning transactions have quite good privacy, so it's difficult to get estimates of how many there are in total. But decent lower-bound estimates exist: https://bitcoinmagazine.com/markets/lightning-network-sees-record-adoption-amidst-new-applications https://bitcoinmagazine.com/markets/lightning-network-sees-r... 2) Of course, by value it's very likely that on-chain transactions dominate, as there are lots of very high value, multi-million+, transactions out there.

fdkjhasdf 3y ago

> ...Unless people bought in the relatively short peaks... That's a bit minimalistic, no? The "short peak" of $50-60k (around 50-100% more than the current value) lasted something like 6 months AFAIK? To be a store of value, you would hope those fluctuations would be nonexistant. Store of value should be for everyone, not just the unlucky ones...

this_user 3y ago

> but so far Bitcoin has been doing OK as a store of value No, it hasn't. A store of value is supposed to be stable, it's about volatility. By that same reasoning you could argue that Apple or Tesla stock, or even the stock market in general, is a great store of value. But nobody would ever call it that, because it is far too volatile on a daily basis. Trying to argue that a vague long-term uptrend in prices makes something a store of value is just more intellectually dishonest cope by cryptobros who are desperate to defend this useless technology.

seydor 3y ago
Volatile compared to what? Dollars. The us government is able to steer dollar as it likes but that comes with violence, it's not "naturally" stable
josu 3y ago
>a vague long-term uptrend in prices makes something a store of value A stable and 100% predetermined issuance schedule, along with its scarcity, it's what makes Bitcoin a good store of value. The steady uptrend in prices is the consequence. >useless technology. Just because it's functionality is limited it doesn't make it useless. A store of value that doesn't require boring the planet, or building empty houses, seems like a great improvement to me. I think that you are conflating the cryptobro culture, with the true value that Bitcoin brings to the table.
- skulk 3y ago
  > A store of value that doesn't require boring the planet, or building empty houses, seems like a great improvement to me. Boring holes isn't tenable but using 15 GW of power is acceptable?
  - siftrics 3y ago
    Energy will continue to get cheaper and less scarce over the long term. This is a bad argument.
  - josu 3y ago

Geee 3y ago

People confuse a lot of things about volatility, risk, and long term valuation. Bitcoin is an inherently good long term store of value, because it has deterministic and finite inflation schedule, which is also plausibly immutable (contrary to fiat cryptocurrencies, called "cryptos"). On the other hand, fiat currencies are a lousy store of value, because they have non-deterministic, but always positive inflation schedule, i.e. they are guaranteed to lose value in the long term. These are just objective facts about their inherent properties. In addition, Bitcoin includes cryptographic property protection, making it a better store of value in jurisdictions where local authorities won't provide property protection, or the cost of property protection is high. For example, in many countries, it's illegal to own US dollars. Bitcoin is easier to hide and use discreetly, compared to anything physical. Volatility is a property of the market, not a property of the asset. All things considered, bitcoin should get less and less volatile when time goes on, assuming that it continues gaining adoption. Which is given, as it doesn't have any competition.

siftrics 3y ago
> contrary to fiat cryptocurrencies, called "cryptos" This is wrong. No one says this.
- tnel77 3y ago
  It’s pretty common in the Bitcoin community.
theorytheory22 3y ago
You're missing the forest through the trees. Bitcoin doesn't have value beyond what can be converted into real currency. Real currency is used to buy things. BTC isn't. The currency-BTC market IS the entire value of Bitcoin. None of the other stuff matters, because BTC is solely denominated in actual currencies. BTC is non-inflationary? Doesn't matter. You only use it to buy USD or actual currencies. If there's less demand for BTC, BTC value goes down. And guess what? Demand is fickle. The cyrptographic property protection is ok in theory. But try and point out somebody it's helped? And by that I mean a non-criminal/extortionist/money launderer.