BITCOIN

Aegis

Zola. said:

Aegis said:

RolandFlagg said:

HHarry said:

RolandFlagg said:

I find it amazing that in 2022 there are some people that still don't get it, but I suppose when electricity was invented some people complained that it was useless because we already had candles.



People don't get it until they do.....unless they never do...but their kids and grandkids will.

Ok, so what need or process is Bitcoin improving?  It doesn’t appear to be FIAT, or wealth storage, or finanicial stability for developing nations.

I totally accept your point about electricity, cars & email, but we’re a decade+ in to Bitcoin and many people are struggling to understand it’s purpose.  

 Saying that, in some respect its a pointless argument.  For many Bitcoin will only be a success when it’s shown the longevity of gold or stocks.  And we’ll all be dead by then!

https://medium.com/@craigiam/bitcoin-why-the-critics-are-wrong-ec27b053cde7

Great, an article that firstly states "nothing I say should be considered investment advice, crypto currencies are very risky investments, and you should only invest money that you would be comfortable losing" before going on to argue that bitcoin is in fact a reasonable investment and that the criticisms, i.e. the risks, are all wrong. 

Looking in turn at the criticisms that article "addresses":

• It is used by criminals and terrorists

Honestly, leading with this seems to be a genuinely poor choice.  I think you should always address the strongest points first, and this is incredibly weak.  In short, it can be immediately dismissed by saying "so what, name a fiat currency that isn't used by criminals and terrorists".  It might be used periodically as a complaint, but the real strength of the claim comes when you argue that bitcoin has no real utility as a currency except for use by criminals and terrorists, which is a vastly different claim and not one I've ever actually seen being made.

• It is not backed by a government

This point is addressed by using a weird dichotomy, asking which you would prefer, a deflationary currency or an inflationary one.  To me, this ignores the crucial aspect of the claim, namely that bitcoin isn't a currency (except in El Salvadore), it's a commodity.  A currency, on the other hand, is linked in some way to the economy of the state which uses it, meaning you can settle debts and pay taxes using that currency (strictly this is the definition for legal tender, but I can generally use Scottish Pounds to do those things even though they are not strictly speaking legal tender - in this case it's a currency with a 1:1 peg to GBP).  The underlying economy of bitcoin is nothing, therefore it is not a currency.

• It is too volatile to be a currency

See above.  In general, I like high volatility investments, but I like to know that the investments have a good underlying value or potential to generate value in future.  Buying a bitcoin now has the exact same underlying value as it will in 10 years (arguably the expectation is that the value per coin should fall slightly because more coins will be in circulation).

• It is a speculative bubble similar to Tulip Mania

This one has the utterly bizarre claim that no-one alive today was also alive in the 1600s.  This is irrelevant as to whether this is an echo of tulip mania.  Instead the author argues that this isn't the same because tulips didn't represent a transformative technology, had a local market and had an unlimited supply.  This isn't accurate, as tulips were indeed transformative at the time, in that new and interesting hybrids were being created specifically for investors, effectively guaranteeing scarcity.  The idea that a local market somehow makes the mania happen doesn't have any form of evidence, it's merely stated and then ignored.  Finally the supply issue is actually a point against the author because it shows that even with an expanding supply it is possible to have an increasing price that far exceeds the fundamentals of the asset in question.

• It has no value

To me this is the only argument needed to deem this an unsuitable investment for me.  The author argues that the following reasons give bitcoin value:

Technology

I don't in any way argue that the underlying technology of bitcoin is interesting, but it has been superseded, is extremely wasteful, and it is not owned by the owners of the coins themselves.  The author cites some examples of people scoffing at now-successful inventions, but doesn't really say why critics are wrong now.

Global currency

I can send GBP anywhere I need to, and I have a card which allows me to spend in local currency.  What this really means is that it's a "currency" which isn't linked to any specific state, which has almost no actual utility to me or the vast majority of users.

Store of value

This is predicated on the coins actually having value and holding that value against a currency.  Again, what the author likely means by this is different to what they say.  I suspect what they mean is that if you have bought in, say, 5 years ago, you would have made a lot of profit.  This isn't the same as something being a store of value, especially if that price rise is the result of a mania.  For example, many of Bernie Madoff's clients would have argued that their investments with him represented a store of value, but in reality he was just running a Ponzi scheme.

The network

The argument here seems to be that it has value because it's popular, and the corollary to that is that if it becomes unpopular we should expect price drops.

Blockchain, not bitcoin

The argument here seems to be that because you can't actually buy into the intellectual property of blockchain, the next best thing is to buy the product which makes use of this.  The issue I have with this is to compare this to, for example, Nintendo and the Switch.  If for some reason I was unable to buy Nintendo shares, then by this logic the rational move would be to buy as many Switches as possible.  I very much disagree with this view, and think it would instead make sense to accept that investment into the intellectual property wasn't possible and to enjoy the product if it was something I enjoyed.  But that doesn't make for a very good soundbite.

Would you care to inform me which crypto asset or "technology" has superseded Bitcoin?

Seriously, out of my entire post, that's all you care about?  Why not just start with Ethereum and go from there?

Zola.

No theres lots I care about / disagree with. I just don't care to reply to it all.  I cherry picked that one for you to humour me. 

The fact you say Ethereum shows that you don't have clue what you are talking about. Explain your rationale on your Ethereum claim please. Last time I checked Ethereum was a complete centralised disaster, ran by VC bros and has no auditing ability etc. Keen to hear why you think it or its technology has superseded bitcoin. You do know it's also ran on POW yeah?  That terribly wasteful technology that you are so against?

Additionally, the fact you think technology is one of the most important part of bitcoin, also shows that you have no idea what you are talking about. 

bugbyte_2

Even if you believe Bitcoin is the most wonderful thing that has ever happened, the proof of work vs proof of stake argument would indicate that there are problems with BTC and (flawed?) solutions to its vast energy consumption, so yes, as a first go at *something* Bitcoin did rather well but its inception and operational issues have been addressed with other newer technologies. This of course cannot be admitted by BTC holders as it kind of makes BTC pointless. Not that there is a definable point anyway.

Zola.

Wrong.

It just indicates someone trying something else... Why? Because copy cat / cloned coins like Litecoin have little impact or adoption... 

Proof of Work secures the network. It is a required security feature to ensure decentralisatuon without interference. Not a bug. 

https://youtu.be/ncPyMUfNyVM

Proof of stake is about centralisation and control from the creators. It only benefits those  those with huge premined bags and allows them to control the network.

https://medium.com/@BobMcElrath/whats-wrong-with-proof-of-stake-77d4f370be15

Flavour of the month coins like Solana who are supposed to be the next best thing continually fall over and go offline. Ethereum creators have to hard fork when they screw up transactions. 

Bitcoin has been making blocks consistently roughly every 10 mins since Jan 2009 without issue. 

It is simply in a league of its own. 

Aegis

Zola. said:

No theres lots I care about / disagree with. I just don't care to reply to it all.  I cherry picked that one for you to humour me. 

The fact you say Ethereum shows that you don't have clue what you are talking about. Explain your rationale on your Ethereum claim please. Last time I checked Ethereum was a complete centralised disaster, ran by VC bros and has no auditing ability etc. Keen to hear why you think it or its technology has superseded bitcoin. You do know it's also ran on POW yeah?  That terribly wasteful technology that you are so against?

Additionally, the fact you think technology is one of the most important part of bitcoin, also shows that you have no idea what you are talking about. 

Well awesome, since I "have no idea what I'm talking about" as you took pains to mention twice, I won't bother to provide you with any further answers.  Try being a decent communicator in future if you actually want responses.

Zola.

😂😂
Typical - always when pressed after you make these type of claims (bitcoin being superseded), you never back it up with anything when asked... and just deflect.

Aegis

Zola. said:

😂😂
Typical - always when pressed after you make these type of claims (bitcoin being superseded), you never back it up with anything when asked... and just deflect.

Typical - you prefer to mock rather than actually address highlighted issues and to insult rather than actually engage like an adult.

Ignored...

Frequentlyhere

It would be interesting to see a response to what I saw as a systemic dismemberment of that article from @Aegis .

I read that article too. It's pretty much a top 10 articulation of incredibly weak arguments for it.

One of my favourites is this bit:

"In the future it is very likely that crypto currency wallets in some form could supplant bank accounts as we know them today. New tools will be developed that can do everything that banks can do but also will be able to do new things that we can’t even imagine today. Why send an ACH money transfer that will take 5–7 days when you can send money over the Blockchain in just minutes. Not only does this technology threaten banks, but also all of the trusted intermediaries that deal with money transfers are no longer needed"

I mean, just think. One day in the bright bright future, if they develop those tools they've had 13 years to work on, we might be able to accelerate the faster payments process we can do in about 30 seconds now typically to 'just minutes'.

And on the rare occasions that we need to send money abroad, we'll 'simply' be able to convert all of our £ to BTC, initiate a BTC transfer, and then another person can transfer all of that BTC back to their own currency. Which may cost probably 5-10x more in effort and expense than the many available ways to do this already, but could theoretically arrive sooner, which is almost always not at all in the slightest bit important. Be still my beating heart.

Plus...plus! We won't need any of those irritating fraud or safety mechanisms that banks have, and will thankfully be able to freely once again send money to entirely the wrong account by getting one digit wrong or be defrauded without recompense. But don't worry, there will be a public decentralised record that we have done so. Praise be!

Aegis

Frequentlyhere said:

It would be interesting to see a response to what I saw as a systemic dismemberment of that article from @Aegis .

I read that article too. It's pretty much a top 10 articulation of incredibly weak arguments for it.

One of my favourites is this bit:

"In the future it is very likely that crypto currency wallets in some form could supplant bank accounts as we know them today. New tools will be developed that can do everything that banks can do but also will be able to do new things that we can’t even imagine today. Why send an ACH money transfer that will take 5–7 days when you can send money over the Blockchain in just minutes. Not only does this technology threaten banks, but also all of the trusted intermediaries that deal with money transfers are no longer needed"

I mean, just think. One day in the bright bright future, if they develop those tools they've had 13 years to work on, we might be able to accelerate the faster payments process we can do in about 30 seconds now typically to 'just minutes'.

And on the rare occasions that we need to send money abroad, we'll 'simply' be able to convert all of our £ to BTC, initiate a BTC transfer, and then another person can transfer all of that BTC back to their own currency. Which may cost probably 5-10x more in effort and expense than the many available ways to do this already, but could theoretically arrive sooner, which is almost always not at all in the slightest bit important. Be still my beating heart.

Plus...plus! We won't need any of those irritating fraud or safety mechanisms that banks have, and will thankfully be able to freely once again send money to entirely the wrong account by getting one digit wrong or be defrauded without recompense. But don't worry, there will be a public decentralised record that we have done so. Praise be!

I can't even remember the last time I sent a payment that didn't slot nicely into the Faster Payments remit and therefore arrive same day, usually within minutes.  I guess if I was regularly sending large payments overseas, the transit time for current payments might still be days, but I know that when I worked for HSBC is was possible to do instant transfers to foreign currency accounts in your own name, so it's likely that there's already a range of solutions that doesn't require blockchain.  Otherwise the majority of payments I make are on credit card to get the points and the section 75 protection, and the transaction happens immediately with settlement usually over the next month or so.  Again, I don't really see a problem here that needs a solution.

bugbyte_2

Zola. said:

Wrong.

Am I though?

Bitcoin can process between 3.3 and 7 transactions per second and to do this it uses approximately the same amount of energy as Argentina.

It uses that amount of energy to deter any attack on the system hence the correct statement "Proof of Work secures the network. It is a required security feature to ensure decentralisatuon without interference. Not a bug. "

If you can read those two sentences and still not see the massive Argentina sized issue here then I suspect there is no hope for you.