BITCOIN

HCIMbtw

Malthusian said:

When people have been running around for 13 years trying to find a use case, with a lottery win as the incentive for finding it, and they don't find it, absence of evidence is evidence of absence.

In 2022 it's like watching people trading Beanie Babies between each other trying to find the one that cures cancer or turns lead into gold.

The "use case" thing is dead and buried, it's all about the mEhDuHvErSe now. (Handing over real money for crypto which is then exchanged for computer game land or clip art, which is generated for free by pressing a button.)

Considering how useful your contributions can be on this forum I am always disappointed in the value of your contributions to this thread. 

mooneysaver

Malthusian said:

lozzy1965 said:

So not entirely sure it's a case of its use case widening so much as frantically rushing round trying to find one beyond being a way to switch money abroad quickly! 

When people have been running around for 13 years trying to find a use case, with a lottery win as the incentive for finding it, and they don't find it, absence of evidence is evidence of absence.

In 2022 it's like watching people trading Beanie Babies between each other trying to find the one that cures cancer or turns lead into gold.

The "use case" thing is dead and buried, it's all about the mEhDuHvErSe now. (Handing over real money for crypto which is then exchanged for computer game land or clip art, which is generated for free by pressing a button.)

Sigh. I don't want to sound like a stuck record, but the nocoiners in this thread seem to ignore any post which points out Safemoon are building wind turbines in Gambia. Using crypto to fund international aid projects whilst helping bank the unbanked.

Zola.

Why do you keep insisting on trying to derail a Bitcoin thread by talking about scam coins? Start your own Safe Moon thread please. 

Keep it on topic at least. This thread is for Bitcoin only. 

Frequentlyhere

As I see it, despite everything, the main reason for BTC's drop in the last few months isn't the 'exciting' stuff but a slow grinding rise in interest rates. There are better places for the big boys to put capital, just as they've fled the nasdaq too which is down 30% itself. With some yield emerging, it makes sense to exit investments that are highly speculative and sensitive to interest rates.



As you can see, the correlation has been pretty high of late, until early May when Luna/Terra happened.

I do feel that this shows that Bitcoin has somewhat 'succeeded' in establishing itself as an asset class in this respect, mostly through pure force of consumer demand leading instititutions as opposed to demonstrating actual value.

 Which means we end up with very odd news articles, like this one today: "JP Morgan sees significant upside to Bitcoin" in which it is reported that JP Morgan's analysts are feverishly expecting BTC at $38,000 whilst simultaneously referring to their CEO saying  "Dimon argued that Bitcoin was a “fraud” in 2017, and called the leading cryptocurrency “worthless” in October of last year. Still, Dimon noted that his clients are “adults” who can make their own decisions

Which let's be honest is a bit schizophrenic whatever side of the fence you're on.

The other thing I would take from that chart is that despite what some seem to think here, stablecoins matter hugely to the value of BTC. BTCUSD has yet to recover a 12% gap that has opened up since the Terra crash, and that that gap exists at all should make anyone invested in Bitcoin exceedingly nervy about the state of Tether as by far the largest stablecoin.

If I had to force myself to make a bull case for Bitcoin in the short term, then I'd pin my hopes on:

1) A Bitcoin spot ETF being approved - denied so far, in no small part explicitly due to Tether by the way. Certainly possible though, given the amount of juicy money/temptation floating around.
2) Interest rates stabilising/falling - seems a bit distant.
3) Maybe an alliance of developing nations 'adopting' bitcoin in fake-chivo El Salvador fashion.
4) Stablecoin regulation, which might in the long run help the stability of the scene.

Maybe some of that stuff will happen and momentum will build in it's $ value. Frankly though, I think this misses the point. Bitcoin has already lost in so many senses. Ben Hunt caught it exactly spot on.

That the value of Bitcoin now is being discussed in terms of interest rates, NASDAQ correlation, stablecoin regulation etc  rather than as a libertarian scream of freedom unleashing us all from the chains of Government money just shows that Bitcoin is very much becoming Bitcoin TM! A cartoon simile of Bitcoin managed neatly under the auspices of the FED + co. It's just another poker chip to play with in the Wall Street casino.

So I don't see it disappearing, but I also really struggle to see it outperforming. If it does, it will very much depend on it's most vocal enthusiasts continuing to come up with 'it's the future' narratives that detract from or somehow exploit this stripping of its soul in very convincing fashion.

HCIMbtw

Frequentlyhere said:

The other thing I would take from that chart is that despite what some seem to think here, stablecoins matter hugely to the value of BTC. BTCUSD has yet to recover a 12% gap that has opened up since the Terra crash, and that that gap exists at all should make anyone invested in Bitcoin exceedingly nervy about the state of Tether as by far the largest stablecoin.


Maybe some of that stuff will happen and momentum will build in it's $ value. Frankly though, I think this misses the point. Bitcoin has already lost in so many senses. Ben Hunt caught it exactly spot on.

That the value of Bitcoin now is being discussed in terms of interest rates, NASDAQ correlation, stablecoin regulation etc  rather than as a libertarian scream of freedom unleashing us all from the chains of Government money just shows that Bitcoin is very much becoming Bitcoin TM! A cartoon simile of Bitcoin managed neatly under the auspices of the FED + co. It's just another poker chip to play with in the Wall Street casino.

I agree with a lot of what you write, just for clarity on the first paragraph I copied, not all stablecoins matter to BTC, the luna/terra incident saw the algorithmic stable coin exploited after the person leading its development had invested a few billion (I think) in BTC as a reserve for the asset. It was a pretty niche set of circumstances of little relevance to the structure of most other major stable coins.  

On your last couple of paragraphs you copied I would reflect, as I think many people investing in BTC, it is very disappointing that BTC ends up correlating and being treated in line with markets and the NASDAQ. To claim this as BTC has already lost though is just hyperbole. 

Its a fraction the size and isn't able to decouple as a perceived risk on asset. As it grows we will see it decouple. 

bugbyte_2

Might be naivety, but I do worry about the ramifications of any single asset being 'too big' to be allowed fail.

BTC has a market cap of approx. $555B* and HSBC has a market cap of £106B, and we know that HSBC, Lloyds, etc. were and still are too big to fail because it has / would take the entire country down with them. Is BTC too big to go to zero without crashing sections of the economy? Is BTC's slide taking NASDAQ with it? Or would BTC crashing have no material effect on anyone who didn't care less? (not saying it would go to zero - I have no idea, I could equally easily put the house on Liverpool winning tomorrow).


*although if you are reading this at any point after I typed it which is probably a given - although Darren will complete some ropy mental gymnastics to argue otherwise - this figure may well now not be correct.

Zola.

Difference with banks you mentioned is there are businesses and houses built off the back of them and there is years of polished regulation. 

Bitcoin is spread so globally that no i dont think it would have material impact on global markets. Sure there appears to be correlation to the nasdaq right now but maybe those similarities are of speculative nature... Risky tech companies with a lot of potential etc. 

People like me who invest in bitcoin do it as a bit of a hedge, with a main focus in broad based index funds etc. If bitcoin goes to zero, it'll be annoying but it will have very little impact on my future.. The upside is massive though... I suspect most people follow a similar strategy. 

I don't know anyone who is all in on bitcoin.. . I suspect its very few people in western societies. 

In some developing nations though it's all they have invested / stored if they are unbanked.

Bitcoin adoption is large and ever increasing, but its overall market cap value is tiny compared to other asset classes... Look at gold, well over 10 times bigger, although it's had thousands of years as a head start 😉

User232002

Malthusian said:

Anyone specific you had in mind? I didn't answer that question because it didn't apply to me. You addressed that question to people who believed 1) that Bitcoin is a "Ponzi" and a "scam" 2) that the current dump represents the end of it. Those two beliefs would only apply to someone with little interest in Bitcoin, few of whom will be reading p218 of a Bitcoin thread.

Its not always about you, dear.

I'm just a bit bored of people whose entire argumentative strategy is to continually argue against something but not put any definitive statements out there to avoid being shown to be incorrect. There's no point continuing this thread and in 5 years time people still talking about quantum cryptography, environmental impacts, or 'crypto bro money in = crypto bro money out.' I post on a forum thats had a Bitcoin thread since 2012 and thankfully people tend to realise that the predictions made by the anti-BTC crowd have been woefully incorrect time and time again. 

Malthusian said:

Not how interest rates work. Governments were perfectly capable of printing money in 1980 when savings accounts paid 10%pa.

Non-best-buy savings accounts pay 0.1% because that is the going rate for lending someone a stable currency, repayable on demand, backed by an industry insurance scheme and ultimately by the taxpayer, for people who don't bother moving their moeny around.

(1) But they didn't

(2) It isn't. Its the market rate when banks have no reserve requirements and very low capital requirements, backstopped by a money printer. They have no need to pay a market rate to market participants because the market is distorted.

Malthusian said:

A generation uninterested in Bitcoin transferring wealth to the generation that is interested in Bitcoin is not a great thing for hodlers. If more millennials get rich thanks to inheritance bailing them out, this reduces the potential market of people buying Bitcoin in the hope of getting rich.

You continue to create axioms and caricatures and argue against them. You are the literal embodiment of a strawman at this point.

People aren't buying Bitcoin to get rich, they are buying it because its a fairer system.

Frequentlyhere said:

Can I hold you to that? If Tether goes completely TU, are you saying that Bitcoin won't be substantially affected as it's a store of value?  

I'm not going to guarantee Tether; I've literally posted here before of how to create insurance against it going under if you have to hold it. I've also continued to expressly state that BUSD and USDC are safer. I see no reason to accept any additional risk.

But people that think Tether is at anything close to a substantial risk of blow up are incredibly deluded. They were investigated by the NYAG and given little more than a slap on the wrist for some minor violations. Do you think NYAG discovered it was an $80BN ponzi and gave them a $20M fine? 

Tether imploding might impact the price of BTC on a short term basis, but no - it wouldn't change the thesis or the long term outlook of BTC. It would be a great capitulation event to buy to be honest.

Frequentlyhere said:

"People under 40 invest in crypto in equal proportion to those who invest in the stock market"

Where's that from out of interest? If true, I'm not sure it's really relevant as lots of people under 40 have pensions invested in the stock market, so they might have £50 in bitcoin and £50k in their pension (and very few in reverse). Even putting that aside, I'm surprised by that, so would be interested to see the source.

This isn't a particularly controversial stat and there are lots of sources that show that broadly younger people make up the majority of crypto market participants. I'll just use this;



"Very few in reverse" is just an example of your bias. As are the numbers given; since given wages have been stagnant for over a decade, there really aren't many people under 40 with £50k in their pension pot.

Pensions use the 60/40 rule so are basically all underfunded because their bonds have underperformed for at least a decade now in real rates. Can't wait until we get to that conversation in 10 - 20 years time and the answer is to print more more to recapitalise these pension funds. 

Frequentlyhere said:

Re: yield/dividends/profit/cash, as per @Thrugelmir 's point, I think the bottom line is that you can't sit on currency and watch it appreciate without some other currency losing out. You can't do it with £, or with $, and if we give Bitcoin the dubious right as a currency you can't with that either. Its gains come from greater fools, of which there seems to be a dwindling supply at present.

Not a currency; its money. 

You are correct that Bitcoin's gains have to come from another currency (in the monetary sense) losing out. In an environment with competing money, a person is incentivised to spend the one that diminishes in value and hold the one that retains or appreciates in value. So yes, Bitcoins gains will come from the erosion of faith in fiat currencies as a mechanism for transporting value over time (store of value).

China and India continued on with the silver standard when Europe switched to gold. Their wealth evaporated as gold took the monetary premium of silver. You can't opt out of monetary competition.

User232002

lozzy1965 said:

"store of wealth" so far not so good.

On what basis? I think its doing just fine...

Malthusian said:

When people have been running around for 13 years trying to find a use case, with a lottery win as the incentive for finding it, and they don't find it, absence of evidence is evidence of absence.

I don't know how many times we've posted the actual use case in this thread. You just continue to shout about 'money in = money out' and add 'bro' to everything whilst restating arguments from 2017.

mattywallace121 said:

Its certainly going to be interesting coming back to this thread in 10 years time.....

I post on a forum that has had a Bitcoin thread since 2012. There is definitely one side that comes out better from reading comments from 2012 - 2018.

Frequentlyhere said:

Frankly though, I think this misses the point. Bitcoin has already lost in so many senses. Ben Hunt caught it exactly spot on.

That the value of Bitcoin now is being discussed in terms of interest rates, NASDAQ correlation, stablecoin regulation etc  rather than as a libertarian scream of freedom unleashing us all from the chains of Government money just shows that Bitcoin is very much becoming Bitcoin TM! A cartoon simile of Bitcoin managed neatly under the auspices of the FED + co. It's just another poker chip to play with in the Wall Street casino.

It only took 221 pages but finally someone has articulated a coherent and valid negative point about Bitcoin. Congratulations Sir. Not so much the talk of correlations, its a stretch to speculate on how true or untrue that is, but the idea that the principles of Bitcoin could be lost or missed would considerably constrain the utility of Bitcoin. 

bugbyte_2 said:

Might be naivety, but I do worry about the ramifications of any single asset being 'too big' to be allowed fail.

BTC has a market cap of approx. $555B* and HSBC has a market cap of £106B, and we know that HSBC, Lloyds, etc. were and still are too big to fail because it has / would take the entire country down with them. Is BTC too big to go to zero without crashing sections of the economy? Is BTC's slide taking NASDAQ with it? Or would BTC crashing have no material effect on anyone who didn't care less? (not saying it would go to zero - I have no idea, I could equally easily put the house on Liverpool winning tomorrow).


*although if you are reading this at any point after I typed it which is probably a given - although Darren will complete some ropy mental gymnastics to argue otherwise - this figure may well now not be correct.

Seems like a silly point scoring exercise to state that I'm going to 'complete some ropey mental gymnastics' about a market cap figure. I literally posted a few pages back that I fully expect Bitcoin to be 'down only' for the next few months 'at least.' Your comment and the caricature it contains says more about you than me.

To the point, it is literally written in to the first block of Bitcoin; "The Times 03/Jan/2009 Chancellor on brink of second bailout for banks." Bitcoin was created to be a robust financial system that expressly did not require bailout from a government. Bailouts create moral hazard and anyone arguing for one for Bitcoin isn't someone who understands what Bitcoin is meant to represent in the first place.

Reaper

OK here's my predication for the future though its a mugs game on an investment where sentiment is king.

Bitcoin has become a "risk on" asset, which was not its intention. As such for a while it will look like a leveraged version of the stock market.

If rival Ethereum successfully converts to Proof of Stake in August then Bitcoin will suddenly look old, slow, and dirty while Ethereum looks new, fast and green. There is a limit on how long the advantage of being first to market can continue and at that point it will go into long term decline.

The Bitcoin price depends heavily on "fear of missing out". As Bitcoin starts to look past its best that fear will decline and with it Bitcoin's price. It will be volatile as always but looking back we will see it's best days are behind it.

(BTW I'm not saying Ethereum will be all roses. The public is largely unaware of the horrors of MEV and the way Ethereum developers are legalising theft instead of tackling it.)