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No apologies, Bitcoin can rot. We as a society have the unique opportunity to reverse a pyramid scheme & foot black marketers with the bill, but instead everyo

by fat0wl 13y ago

No apologies, Bitcoin can rot. We as a society have the unique opportunity to reverse a pyramid scheme & foot black marketers with the bill, but instead everyone is just buying up more because "up up up and awayyyy it goes!!!". Because computers. Because cryptoooo. Because whatever-BS-notion-you-use-to-convince-yourself-that-the-ecosystem-is-so-valuable-it-has-an-insane-amount-of-subjective-worth-and-for-some-reason-subjectivity-is-now-esteemed. Because Litecoin isn't as hip. Instead, people are contributing massive amounts of money to the ecosystem where black marketers & the founders already have the upper hand (you're buying that one Bitcoin for $600 or w/e made up price it currently has been bid to, as opposed to their hoards). Even with your enlightened knowledge about "subjective value" you should realize that once you're in the same medium, their much bigger BTC# means a much bigger slice of the pie. But Bitcoiners believe the pie is infinite, right?

ISL 13y ago
Erm, in order to cash out, founders/early adopters have to sell a slice of the pie. Furthermore, anyone with a lot of BTC is incentivized to cash out slowly in order to keep the price up. The Man has the upper hand, as does any weakness in the protocol. Either one, especially the latter, has the capacity to destroy bitcoin overnight. I'm not too worried about "Nakamoto" devaluing bitcoin (though I do wonder what "Nakamoto" will do with that much money/power. A billion dollars can do a lot of good or a lot of ill.).
- fat0wl 13y ago
  i'm not convinced the currency can survive since it's really blind faith that is holding it up, so i'm partially just examining an end-game scenario. If BTC starts to plummet (which will likely happen at some point in an ecosystem so volatile) people may literally lose their investment entirely. Why? No one will want to sell assets they paid $600 for for $10, they'd rather believe it is going to climb back up. Then even if they decide "fuckit it's over its just a currency now I guess I'll sell" nobody will want to buy. They'll instead buy a cryptocurrency that has a better theoretical mechanism for stability and can actually be used in practice (unless people are so dense that they want to restart the speculation cycle). The ecosystem could just freeze and there is no way to force people to continue to buy into it (I once read an analysis by an economist in which he mentioned that black marketers may end up having to intimidate constituents to buy into it in order to keep it afloat). Basically this all kindof boils down to a Game Theory issue where everyone wants to sneak their money out at the proper time in order to maximize their cashout before the system fails or the market corrects (I'm not sure it ever will based on the nonsense principles used to design the mining rules / currency cap). But not everyone can cashout at the amount they paid in. In fact, as I point out in my endgame scenario, many may not even be able to cash out at all. It's a mass vehicle for redistributing wealth and the volatility makes it useless as a currency. It may take a while to fail but when it does a lot of people will get screwed. Think about it. The guys with those hoards are probably slowly cashing out 10 BTC now & then to put 5k in the bank, knowing full well that these crazy prices can't hold forever. They are a godsend for the scheme's designers who printed all the free money for themselves. For blackmarketers & gambling sites its more dangerous because they may end up with a wallet full of worthless coins. When people say "Don't invest more than you can afford to lose" I like to internally translate that to "Don't invest more than you'd be comfortable with having a criminal potentially steal from you". And then good luck trying to get the US Gov to bail you out, lol. They are looking at Bitcoin totally amorally to understand it. They couldn't give a rats ass about the investors. Amway is legal, after all. :D
  - AJ007 13y ago
    There is nothing unique about Bitcoin's jump from any other asset price bubble other than possibly there is little leverage involved (30:1 leverage at investment banks during 2008.) I have nothing against Bitcoin. The concept of programmable currency is great. To use the word investment here is a mistake. Buying bitcoin for the purpose of holding is a speculation that the price will continue rising.

by fat0wl 13y ago

ISL 13y ago

Erm, in order to cash out, founders/early adopters have to sell a slice of the pie. Furthermore, anyone with a lot of BTC is incentivized to cash out slowly in order to keep the price up. The Man has the upper hand, as does any weakness in the protocol. Either one, especially the latter, has the capacity to destroy bitcoin overnight. I'm not too worried about "Nakamoto" devaluing bitcoin (though I do wonder what "Nakamoto" will do with that much money/power. A billion dollars can do a lot of good or a lot of ill.).

fat0wl 13y ago
i'm not convinced the currency can survive since it's really blind faith that is holding it up, so i'm partially just examining an end-game scenario. If BTC starts to plummet (which will likely happen at some point in an ecosystem so volatile) people may literally lose their investment entirely. Why? No one will want to sell assets they paid $600 for for $10, they'd rather believe it is going to climb back up. Then even if they decide "fuckit it's over its just a currency now I guess I'll sell" nobody will want to buy. They'll instead buy a cryptocurrency that has a better theoretical mechanism for stability and can actually be used in practice (unless people are so dense that they want to restart the speculation cycle). The ecosystem could just freeze and there is no way to force people to continue to buy into it (I once read an analysis by an economist in which he mentioned that black marketers may end up having to intimidate constituents to buy into it in order to keep it afloat). Basically this all kindof boils down to a Game Theory issue where everyone wants to sneak their money out at the proper time in order to maximize their cashout before the system fails or the market corrects (I'm not sure it ever will based on the nonsense principles used to design the mining rules / currency cap). But not everyone can cashout at the amount they paid in. In fact, as I point out in my endgame scenario, many may not even be able to cash out at all. It's a mass vehicle for redistributing wealth and the volatility makes it useless as a currency. It may take a while to fail but when it does a lot of people will get screwed. Think about it. The guys with those hoards are probably slowly cashing out 10 BTC now & then to put 5k in the bank, knowing full well that these crazy prices can't hold forever. They are a godsend for the scheme's designers who printed all the free money for themselves. For blackmarketers & gambling sites its more dangerous because they may end up with a wallet full of worthless coins. When people say "Don't invest more than you can afford to lose" I like to internally translate that to "Don't invest more than you'd be comfortable with having a criminal potentially steal from you". And then good luck trying to get the US Gov to bail you out, lol. They are looking at Bitcoin totally amorally to understand it. They couldn't give a rats ass about the investors. Amway is legal, after all. :D
- AJ007 13y ago
  There is nothing unique about Bitcoin's jump from any other asset price bubble other than possibly there is little leverage involved (30:1 leverage at investment banks during 2008.) I have nothing against Bitcoin. The concept of programmable currency is great. To use the word investment here is a mistake. Buying bitcoin for the purpose of holding is a speculation that the price will continue rising.