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I think you need to define success and failure here. It has already failed at the goal of being a currency. It lacks the attributes of a good currency, and sho

I think you need to define success and failure here. It has already failed at the goal of being a currency. It lacks the attributes of a good currency, and shows no sign of gaining them. It has already succeeded as a financial system for illegal transactions. That success won't go away, until bitcoin / $ exchanges go away. (Which will likely be never.) Speaking of crypto in general, it is successful in parting fools from their money. Between the inevitable boom / bust investment cycle, and the high-profile exchange scams, there is no lack of bigger-fools willing to lose money. It is successful at illegal transactions because its physically safer than cash. It is successful at speculation because people are greedy. Neither of those conditions are changing anytime soon.

curtisblaine 2y ago
You're a bit uncharitable here. Bitcoin isn't only a financial system for illegal transactions, it's also (the only?) financial system for legal transactions that Visa and Mastercard won't touch. I'm not very happy of living in a world where payment processor monopolies decide what you can buy or fund, and if Bitcoin helps working around them, long live Bitcoin.
- bruce511 2y ago
  >> Bitcoin isn't only a financial system for illegal transactions, I didn't mean to imply that it was. I don't think I said that, but I can see how it might be interpreted that way. Sure, it's a (terrible) financial system for legal transactions as well. (Terrible defined as slow, expensive, and volatile - pick any 3.) Cash works for things that are grey enough that Visa and Mastercard (or more accurately, banks, won't get involved in.) So yeah, there's a niche for bitcoin use there as well (although I'd argue that if your business requires something like bitcoin, or cash, to succeed, then it's not much of a business...) Of course, sure, if you're anti-establishment then it's a good option as well. Again so is cash, or apparently gold.
  - enether 2y ago
    I think the slow and expensive argument can be rebuted fairly easily. The traditional financial system is formed of many layers. At a high level, it is: central banks, commercial banks, then card processors. You have to change your view to see Bitcoin as the settlement layer of this new anti-establishment currency, similar to how central banks settle today. That doesn't need to be fast, it needs to be secure. Bitcoin is pretty fast in settling relatively speaking, at least compared to other currencies.[1] It's important to look at the amount of value (electricity, power, money) that backs the block, instead of the raw block speed. People mistakenly compare block-time - look at Litecoin, it doesn’t matter if it has 4x faster blocks when 4 Litecoin blocks are worth many many times less than one Bitcoin block. The cost to reverse (51% attack) a transaction is much lower. If you agree with that view, then the Lightning Network[2] can be a promising solution to the slow and expensive argument. It isn't a 1:1 replacement to Bitcoin (someone else will likely need custody your coins if this scales to a global level), but it does solve the problem. As for the volatility, I think it's entirely expected to have extreme volatility as a currency is monetizing[3]. There's no real way for it to get from $0 to $2T of market cap in less than two decades (and perhaps go toward $20T) without large price appreciation and subsequent busts. Look at Apple stock as comparison. And it's not a fair comparison, because a stock has an underlying revenue stream that puts an implicit floor and ceiling to its price, whereas a monetary asset like Bitcoin doesn't. In essence, I believe it's premature to declare it "already failed" at being a currency. Although I agree that the signs of becoming a currency aren't strong. 1 - https://medium.com/@nic__carter/its-the-settlement-assurances-stupid-5dcd1c3f4e41 https://medium.com/@nic__carter/its-the-settlement-assurance... 2 - https://www.lynalden.com/lightning-network/ https://www.lynalden.com/lightning-network/ 3 - https://www.2minutebitcoin.org/blog/i-love-bitcoins-volatility https://www.2minutebitcoin.org/blog/i-love-bitcoins-volatili...
GianFabien 2y ago
I think the implied definition of success is that somebody who invested $1000 into Bitcoin 15 years ago is now worth $103B. https://www.bankrate.com/investing/bitcoin-investment-worth-now/ https://www.bankrate.com/investing/bitcoin-investment-worth-... Of course, you would still need to be able to either pay for stuff with Bitcoin or convert it into fiat currency to realize the claimed gains.
enether 2y ago
A lot of things to unpack in this comment, but I mainly want to define success as "appreciating value" and failure as "losing value". So if it went from $100k to $10k in the next year, stayed at $10k for a few years and then trended toward $0. I think I would define that as failure. What do you think then?
- bruce511 2y ago
  Ah, so you mean in the sense of a speculatory investment. I guess that happens when there are no longer fools willing to play. That could happen tomorrow, or in 10 years. It probably doesn't go to zero (it still has value other than speculation) but getting price stability would actually make it more successful (as a currency) than it is now.
  - enether 2y ago
    I don't see how it could happen overnight - so I don't imagine it's possible it happens tomorrow. I could imagine it happening over the course of years. But the question then is - what would it take to change the public's minds?
    - bruce511 2y ago
      Like all speculatory investments, which have little underlying value, the ride ends when the bubble bursts. Usually this happens when the money runs out - when it's no longer possible to find the next "greater fool". That might take a while - there's a LOT of money in the world, and a lot of greedy people willing to be convinced that there's gold in them thar hills.

curtisblaine 2y ago

You're a bit uncharitable here. Bitcoin isn't only a financial system for illegal transactions, it's also (the only?) financial system for legal transactions that Visa and Mastercard won't touch. I'm not very happy of living in a world where payment processor monopolies decide what you can buy or fund, and if Bitcoin helps working around them, long live Bitcoin.

bruce511 2y ago
>> Bitcoin isn't only a financial system for illegal transactions, I didn't mean to imply that it was. I don't think I said that, but I can see how it might be interpreted that way. Sure, it's a (terrible) financial system for legal transactions as well. (Terrible defined as slow, expensive, and volatile - pick any 3.) Cash works for things that are grey enough that Visa and Mastercard (or more accurately, banks, won't get involved in.) So yeah, there's a niche for bitcoin use there as well (although I'd argue that if your business requires something like bitcoin, or cash, to succeed, then it's not much of a business...) Of course, sure, if you're anti-establishment then it's a good option as well. Again so is cash, or apparently gold.
- enether 2y ago
  I think the slow and expensive argument can be rebuted fairly easily. The traditional financial system is formed of many layers. At a high level, it is: central banks, commercial banks, then card processors. You have to change your view to see Bitcoin as the settlement layer of this new anti-establishment currency, similar to how central banks settle today. That doesn't need to be fast, it needs to be secure. Bitcoin is pretty fast in settling relatively speaking, at least compared to other currencies.[1] It's important to look at the amount of value (electricity, power, money) that backs the block, instead of the raw block speed. People mistakenly compare block-time - look at Litecoin, it doesn’t matter if it has 4x faster blocks when 4 Litecoin blocks are worth many many times less than one Bitcoin block. The cost to reverse (51% attack) a transaction is much lower. If you agree with that view, then the Lightning Network[2] can be a promising solution to the slow and expensive argument. It isn't a 1:1 replacement to Bitcoin (someone else will likely need custody your coins if this scales to a global level), but it does solve the problem. As for the volatility, I think it's entirely expected to have extreme volatility as a currency is monetizing[3]. There's no real way for it to get from $0 to $2T of market cap in less than two decades (and perhaps go toward $20T) without large price appreciation and subsequent busts. Look at Apple stock as comparison. And it's not a fair comparison, because a stock has an underlying revenue stream that puts an implicit floor and ceiling to its price, whereas a monetary asset like Bitcoin doesn't. In essence, I believe it's premature to declare it "already failed" at being a currency. Although I agree that the signs of becoming a currency aren't strong. 1 - https://medium.com/@nic__carter/its-the-settlement-assurances-stupid-5dcd1c3f4e41 https://medium.com/@nic__carter/its-the-settlement-assurance... 2 - https://www.lynalden.com/lightning-network/ https://www.lynalden.com/lightning-network/ 3 - https://www.2minutebitcoin.org/blog/i-love-bitcoins-volatility https://www.2minutebitcoin.org/blog/i-love-bitcoins-volatili...

GianFabien 2y ago

I think the implied definition of success is that somebody who invested $1000 into Bitcoin 15 years ago is now worth $103B. https://www.bankrate.com/investing/bitcoin-investment-worth-now/ https://www.bankrate.com/investing/bitcoin-investment-worth-... Of course, you would still need to be able to either pay for stuff with Bitcoin or convert it into fiat currency to realize the claimed gains.

enether 2y ago

A lot of things to unpack in this comment, but I mainly want to define success as "appreciating value" and failure as "losing value". So if it went from $100k to $10k in the next year, stayed at $10k for a few years and then trended toward $0. I think I would define that as failure. What do you think then?

bruce511 2y ago
Ah, so you mean in the sense of a speculatory investment. I guess that happens when there are no longer fools willing to play. That could happen tomorrow, or in 10 years. It probably doesn't go to zero (it still has value other than speculation) but getting price stability would actually make it more successful (as a currency) than it is now.
- enether 2y ago
  I don't see how it could happen overnight - so I don't imagine it's possible it happens tomorrow. I could imagine it happening over the course of years. But the question then is - what would it take to change the public's minds?
  - bruce511 2y ago
    Like all speculatory investments, which have little underlying value, the ride ends when the bubble bursts. Usually this happens when the money runs out - when it's no longer possible to find the next "greater fool". That might take a while - there's a LOT of money in the world, and a lot of greedy people willing to be convinced that there's gold in them thar hills.