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Old December 20th, 2018 #1
Alex Linder
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https://bitcointalk.org/index.php?topic=5084077.0
 
Old December 24th, 2018 #2
O. Pierce
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Bitcoin is legal tender nowhere and not redeemable for any commodity. It isn't backed by military force, either. The whole network uses a ridiculous amount of electricity to perform futile computations. How is this not just an elaborate Ponzi scheme? You're hoping that someone will want to buy your waste heat receipts in the future because.... of Bitcoin brand name recognition, I guess? The supply of crypto is not limited if anyone can just copy the bitcoin (or litecoin, monero, or whatever) source code and start minting his own coin.

It seems to me that the future of crypto is to keep the blockchain technology but to ditch the "mining" process. Use the blockchain for trading digital depository receipts of hard assets that exist in a vault somewhere. For example, a company buys a million ounces of gold and creates a million bitgold tokens on its network. The company then sells its bitgold tokens (for dollars, bitcoin, or whatever else it will accept). This company, however, would be legally obligated to withdraw gold from its vault for anyone with a token who shows up at its office. Obviously, this wouldn't be happen very often. And the company needs to exact transaction fees in order to keep the vaults and offices staffed.

It turns out that several Gold-backed cryptos exist. (https://www.agau.io/, https://ekon.gold, https://onegram.org/). (Disclaimer: I don't own any of these and I'm not trying to hawk them, but I'm posting the links for those who are interested because I think this is the future of crypto).

This model could be extended to ownership of companies (e.g., tokens redeemable for units of S & P 500 ETFs), or to futures contracts for commodity delivery (of oil, wheat, etc). Furthermore, a company could create its own composite coin by combining several assets that have inverse price correlations (that is, one moves up when the other moves down). Now, you have a currency that has two very appealing properties: it can't be created out of thin air and it can be redeemed for utility goods.
 
Old December 26th, 2018 #3
Alex Linder
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I don't know...you have too much emotion against it, which tells me you feel there is something to BitCoin.

It's easy to point out what's wrong with real ponzi schemes, undeniable. social security, madoff and such.

All money is based on faith, there's more reason to have faith in BitCoin's underlying technology than in the dollar.

Both are valuable and figure to be valuable in the future, is my guess.

The difference between dollar and bitcoin is that bitcoin is based on solid and developing technology, whereas dollar is based on US Govt. which is essentially a global empire that is running out of quality people.

Russia, China and others are working to create options besides SWIFT and the dollar as currency reserve. I don't think the long-term future for the dollar is solid, altho I'm sure it will retain value for some time.
 
Old December 26th, 2018 #4
Dan Hadaway
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Quote:
Just one year has passed since bitcoin enthusiasts forecasted that the cryptocurrency would hit a price of $1 million.

But that was then. With the price of bitcoin BTCUSD, -0.72% having fallen almost 80% from its peak, and now trading well-below the support level of $6,000, everyone is wondering where it goes from here.

The answer is, a swift and painful drop to zero.

In a MarketWatch column I wrote last April, I explained what it would take for bitcoin to become worthless. Bitcoin is getting close to that point. As I argued, once Bitcoin’s price falls below its cost of mining, the incentive to mine will deteriorate, thrusting bitcoin into a death spiral. That is, without the mining activities supporting the ledger that maintains the records of who owns what — bitcoin is, after all, a set of encrypted numbers that cannot establish the ownership of anything — bitcoin will become worthless.

A typical asset has a set of cash flows, and its value is driven by investors’ expectations of those cash flows. Bitcoin has no cash flows. In that respect, it is more like gold, in that its value is driven to some extent by its desirability and potential uses, but mostly by its cost of mining. While there are many estimates of bitcoin’s cost of mining, most suggest it is close to $5,000 per coin. Furthermore, even though traditional commodities like gold require significant investments, with limited technical knowledge and capital, anyone can mine bitcoins. Thus, the price of bitcoin must be close to the fully loaded cost of mining it (meaning you are modestly compensated for your time and capital outlay). So, one would expect the price of bitcoin to fluctuate somewhere around that point.

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Moreover, there is one additional complication: Unlike gold, which, probably due to a historical accident, is universally accepted as a store of value, bitcoin is a digital commodity with no such universal acceptance as a store of value. While the original buyers and miners of bitcoin were true believers in the paradigm shift they thought it promised, and were willing to make the necessary investments for future gains, the more recent buyers and miners have been run-of-the-mill, greed-driven investors.

Their greed has been further fueled by futures trading, which was introduced when bitcoin prices were booming and the sun appeared to be perpetually rising on the horizon. With bitcoin prices well above the cost of mining, they saw an obvious arbitrage opportunity: Mine bitcoin and sell it for a higher price in the futures market for guaranteed arbitrage profits.

Not surprisingly, traditional investors took notice, with many investing in mining operations, and the bitcoin that were expected to be generated by mining were sold in the futures market. As more arbitrageurs entered the market to exploit this opportunity, bitcoin prices were pushed down close to their cost of mining (with a small return) and led to a long (in bitcoin world) period of stable prices. It also changed the complexion of the miners, and a higher proportion of them are now fair-weather miners looking for a quick buck who would quickly disappear once the opportunity dissolves.

Yet the cost of mining bitcoin is not a fixed-dollar amount. There is a feedback mechanism in mining any commodity that applies to bitcoin: as the price of bitcoin increases, new miners enter the market, increasing the effort required to mine a bitcoin, as its reward will be shared among a larger group of miners. Similarly, when the price of bitcoin falls and miners exit, the cost of mining decreases. However, the number of miners cannot fall below a certain level, because without the miners providing the computing power to maintain the ledger, the bitcoin blockchain will not remain viable.

Mining at a cost higher than the cost at which you can sell in the futures market destroys value. So, any rational investor — even one who strongly believes the price of bitcoin will rebound — has no incentive to mine if the cost of mining is higher than the future price and is better off buying in the futures market. And unlike gold, which can retain its value even if mining activity stops, bitcoin can have no value absent the mining activity that maintains the ledger of who owns it. Absent the mining activity, bitcoin is a just a set of encrypted numbers with no value.

Death spiral

So, it appears bitcoin is now entering a death spiral: If the price continues to drop and the cost of mining does not fall correspondingly (the cost of mining will algorithmically decrease, but not necessarily to same extent as the decline in prices), bitcoin will quickly go to zero.

Bitcoin proponents will argue that bitcoin’s price has dropped by large percentages before. Except this most recent decline is different in three significant ways. First, the magnitude of the recent decline dwarfs the magnitudes of past declines. Second, the losers in the recent decline are new investors who will likely retreat until there is more clarity around bitcoin’s use cases. Third, the futures markets have changed the game, enabling miners to estimate their mining losses and profits at the outset — if you can buy in a futures market at a price below my mining costs, why mine for a sure loss?

Many will argue that bitcoin becoming truly worthless is extreme. Sure, looking at some memorable fads and bubbles, tulips still trade for $10 a bunch and Beanie Babies are fairly priced at $5.

And it looks as though the Blockchain economy is here to stay, where many of our transactions will be processed on the blockchain and use cryptocurrency for daily transactions. Indeed, while the world maybe forever be indebted to Satoshi Nakamoto for giving us a viable cryptocurrency, bitcoin may cease to exist. An improved coin might evolve, or governments might start issuing cryptocurrencies. History is full of examples of innovative companies that went bankrupt, and the “me-too” companies becoming the best investments.

And after all, I can still give my wife a bouquet of tulips and make her happy. And I can still give Beanie Babies to my grandchildren to play with. But what am I going to do with a set of numbers that I cannot prove makes me an owner of anything?
https://www.marketwatch.com/story/bi...ess-2018-12-03
 
Old December 26th, 2018 #5
Alex Linder
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i hope it keeps falling. would love to see it under 1k, last i saw it was over 4k again
 
Old December 27th, 2018 #6
Alex Linder
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what's a dollar? paper and ink. no inherent value. value is it's backed by the USG. which allows it to be debased continually for 100 years. as the US empire dc

bitcoin or some alternative currency based on blockchain will work because there is a market for non-inflatable currency and private value exchanges not trackable by govt, completely outside the banking system. bitcoin is the first and most famous, if it's not the best in other ways. there are only 21,000,000 bitcoins that can exist, that's how the creator set it. some of them are lost forever.

just watching now, but keiser and herbert discuss it, i think in this dec 27 episode


Last edited by Alex Linder; December 27th, 2018 at 09:07 AM.
 
Old December 27th, 2018 #7
Alex Linder
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points

BitCoin ,then pushing block chain. some distinction here. these guys are saying BitCoin > generic blockchain technology due to proof of work

analyst predicts BC rise back to 5-6k then fall back under 3k in 2019

alt-coin = non-bitcoin. a term.

expects true bottom when bc starts rising, the alt-coins stay low, as he thinks they're garbage. "tone vays" is the analyst.

"BC is as sound as it ever was from a FUNDAMENTAL perspective." and he has the OPPOSITE view on other coins. he means bc's CODE is improving, getting better.

fundamentals = code. code updates are very good, he says.

this is NEW stuff. not all the KINKS are worked out. that's why it has exhilarating highs and perilous lows.

if Euro breaks up (back to franc, lira, marc, etc), that's good for BC

"BC is the only investment-grade asset" he says

if you have a 3-5 year outlook, bc is great buy, particularly under 5k

BC has declined 80% from all-time high on 20 december 2017, why?

hype. people thought pro traders coming in would change things. overshot up, now overshooting down. is vay's explanation.

he says: i have no bc held by third parties

when it IS, then risk of them doing the fractional reserve bs. which has led people like keiser to mention "proof of keys"

which almost defeats the purpose of bc - you being able and supposed to manage your own money. not leave it/trust it with third parties

advises people not to use coinbase. bitcoin was designed for you to hold your own money. like silver or gold.
 
Old December 27th, 2018 #9
Alex Linder
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points:

- 2018 saw code for smaller, quicker transactions (more useful). "layer 2 scaling solutions like Lightning"

- making bitcoin more useful so it can begin to compete with zognotes

- challenges from forks (such as BitCoin Cash) dissipate

- BC has fallen 80-90% 4-5x...but if you look at any other timescale apart from that last 12 months this is top performing asset...

- (expert 2) more institutionalized. market changing. 1500 is more reasonable. needs to go to knew lows and stay there awhile

- rearchitecture of financial system

- BC been thru these cycles before. which comes out the other side, which go to 0?
 
Old December 27th, 2018 #10
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What's your opinion on this, Alex? Do you think it's a good buy around the $1000-1500 range? Anyone else want to comment?
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Old December 27th, 2018 #11
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At this point, I don't see BC being a good investment. The only useful purpose I see for it is donating to WNs who got the boot off of payjew or gojewme.
 
Old December 27th, 2018 #12
Alex Linder
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Quote:
Originally Posted by Crowe View Post
What's your opinion on this, Alex? Do you think it's a good buy around the $1000-1500 range? Anyone else want to comment?
i think it's a good buy. for long term. i dont think price matters much. similar to gold. you buy on dips, buy at bad times. that's now.

i think now is a great time. but you could also wait and see if it goes under 2000 as some think.

but beware: there is a real chance ALL money invested in BC is lost.

if BC does become The crypto, it wont matter at all what you paid, otherwise - same thing. this stuff is more all or nothing. so it seems to me with some research. this is the year i really look into it. i've done one round, now i'm really looking at it hard.
 
Old December 27th, 2018 #13
Alex Linder
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serious people believe BC will end up worthless. serious people i side with believe it will be worth a very great amount per coin.
 
Old December 27th, 2018 #14
Alex Linder
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Quote:
Originally Posted by Dan Hadaway View Post
At this point, I don't see BC being a good investment. The only useful purpose I see for it is donating to WNs who got the boot off of payjew or gojewme.
yr buying it on pontential, not on proven results. it's speculation. you're going for a huge win, not buying GE shares or putting it in a CD at 1.2%.

this is a new, unclear very dynamic exciting market. BC is the first in. i think there's something to it.
 
Old December 27th, 2018 #15
Alex Linder
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all money at all times is invested in something.

i dont make distinction between investment and speculation. some people will try but they're basically moralizing without admitting it. what THEY do = investment. what YOU do is speculation. so when you lose, they can moralize. when they lose, of course, it's always someone else to blame.

BitCoin is speculation. It's possible there's nothing to its technology. Or that some other coin passes it.

But to say there's no use for decentralized, private personal banking outside govt and (((bank))) control is absurd. Someone(s) will make it happen.
 
Old December 27th, 2018 #16
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Here is a question for those that self identify as sci-fi sexual:

What was the "money" used by the space travelers in Star Trek, Lost in Space, and Star Wars?

When a space person wanted to by some zero gravity tampons at the commissary, what currency did he/she use?

If and when a space colony is formed, what would be the currency? Would the space colonist start mining precious metals on their new planet once they landed, or would the go directly to crypto currency?

Forming space colonies would mean that that there had been some technology developed to extract energy from nature very easily, so having the energy to mine crypto-coins would be a non-issue. Or maybe it would, since computing system powered by such an energy source would be able to break all existing crypto algorithms and key lengths within short periods of time. This means the crypto algorithms would have to be vastly more sophisticated and/or the keys vastly longer.

The real question is, if humans had to start a civilization from scratch, but had computing machines, would they start mining for precious metals or go crypto?

[This post is more of a thought experiment, and not a promotion of space travel and space colonies.]
 
Old December 28th, 2018 #17
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I don't know much about BitCoin, but anything that undermines the ZOGbuck, the better.
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Old December 29th, 2018 #19
Alex Linder
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VentionMGTOW
13 hours ago
I'm an old prepper/silver stacker. I just treat bitcoin like another kind of precious metal. I buy some every payday, lock it in the bank box and go on with my life. I doubt I'll ever sell a large percentage of my bitcoins. When the demand for bitcoins increases and they reach the point where it pencils out that I can retire on them, I'll do so. Then I'll sell my paid off house (store the 300k I should get for it, in vaulted gold) and use that as a buffer for the bull and bear markets. When bitcoins are doing well I'll draw my expenses from bitcoins. When they're having a year like this year I'll draw from what I can get for selling the house. I'll keep the amount of bitcoins I cash in under 38,600 a year. Below that level no capital gains taxes are due. I live very comfortably on way less than that right now (income from my mechanic job 4600, spending 1400, and my surplus is usually over 3000 a month). I buy some bitcoin every payday, drop it into the bank box, and it's totally painless. I can keep this up for years if necessary.

I love how compact and weightless Bitcoins are. If I needed to travel anywhere on foot with my silver it would be way too heavy to go very far with it, and I certainly couldn't travel overseas with it. With bitcoins however, I could get on a plane, fly to one of these low cost countries and live many years on those bitcoins (even at the current price of 3600), and there's nothing customs can do about it because I wouldn't need to even have them with me. I could just stash them onto encrypted cloud storage and i'm good. LOL, I probably would have done that if Hillary were elected, But as long as Trump is in office I'll stick around, keep fixing trucks for a living, and keep buying bitcoins.
 
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