BITCOIN

HHarry

15th June - “But they also aren't trying to be money either, that category has been won and Bitcoin is the winner.”

17th June - “ Is this the time when you said you would consider Bitcoin a success if you could pay for coffee with it? The general point I made in rebuttal was that this isn't something I want to happen, nor consider likely”

So Bitcoin is the best of the crypto’s at being money, but it isn’t currently and probably won’t be?  

 

HCIMbtw

fwor said:

darren232002 said:

The exposition of nuance and technical knowledge takes time.

And, as you can see, he is also a master of condescension.

Surely Darren232002 blew any credibility that he might have had here by writing this:

darren232002 said:

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

Yes, of course - we all know that the spectacular rise in the price of Bitcoin was nothing to do with people wanting to get rich quick...

I think Darren's contributions are excellent for what its worth, super detailed, considered and backed up. Here is a clearly very educated and intelligent bloke engaging you on every point you make. Incredible, what a fantastic free source of thought provoking knowledge and engagement. 

He also has absolute conviction in his theory. 

So a few people might have their feelings hurt when they try debate with them, and he might make them feel like idiots or be condescending. I think that is the more reason to put real thought and consideration to arguments you make. 

I think the debate is excellent. 

And just to emphasise a point It is ok to be wrong.  To not learn from it is a bit of missed opportunity though.

fwor

I'm sorry to have to disagree, but most of Darren's input is based on the principle of throwing out a mass of information, much of it capable of interpretation in many other ways than the one that suits his narrative, but safe in the knowledge that most people have better things to do with their lives than try to deal with it point by point.

It has now become relatively common to "win" an argument on a forum simply by overwhelming the other side with quantity.

Frequentlyhere

Finally found time to reply. I've rewritten this several times as there's much food for thought, I genuinely mean that, thanks Darren. Responding to each point became too unwieldy to be honest though, so I've cut it down to the bits I'm particularly interested in. 

I suppose the thing that strikes me most is that whilst individually some of the strands of thinking about the hows and whys of BTC becoming a powerful de facto global reserve currency are intriguing and even plausible, what we're left with in the end is almost akin to one of those lines of dominos that fall one onto another to reach a grand conclusion.

 Except instead of a neat pre-prepared line, we just have a big bag of dominos that we're going to toss up into the air, watch them land at random on the floor, and then we hope that they land just so. So that we can push one over and this chain of events gets set off.

Firstly there's the small matter of the current global monetary system collapsing under the weight of its own debt as opposed to anyone finding anything at all that can be done about it and/or the problems that causes within the current parameters available.

To be of use to you or us personally that would also have to happen pretty soon too in global event terms, and as you've acknowledged you've no idea whether it'll be this time or next time (or the time after?).

Then the appeal of bitcoin would have to expand from the hardcore group dramatically: " As people lose faith in central banks, they will turn to something else to have faith in". Well, some people clearly have faith in it, but many others have sold out and the vast majority haven't bought any at all. Most probably couldn't work out how.

One of the biggest issues is that your view of the pristinity of bitcoin is being continually sullied by so many of those who would otherwise have the power to make it more influential. For as long as it remains unregulated, crooks are drawn likes moths to a flame to take advantage of people. The scams are daily, and even if you achieve the goal of separating bitcoin and the rest of crypto in people's minds you still have to somehow separate bitcoin from being held on shady/rug pulled exchanges, or being traded with unstable stablecoins. How is this a breeding ground for faith to be built?

Then there's everything else, the randomness of life. Something better may come along. Perhaps something that delivers your vision almost entirely but just tweaks a few technical problems of bitcoin and for whatever reasons gains popularity, you'd win the argument but have lost almost everything still.  Or the old chestnut which I'm sure you've addressed before here of quantam computing breaking bitcoin? More boringly, the ongoing yet still largely forthcoming regulation of the whole scene could  leave Bitcoin hobbled into a commercial sidetrack or supplanted by a stablecoin that remains unsullied in the public's mind somehow.

Whilst I'm sure you're quite capable of parrying any and each of these points with alternative scenarios individually, it does seem rather a pitch perfect set of circumstances that are required for Bitcoin to end up where you need it to. There are an awful lot of probabilistic elements going on, and that's just the known known elements. To me, you've made a reasonable shout as to why one might hold 1 BTC (or even 2, heck they're on sale!), but it's a bit of push to go putting huge parts of your net wealth in it IMHO.

Again, sorry I haven't addressed each and every point. I will say though, I'll do you a deal. If you don't bring Schiff into this then I won't quote Saylor and Keiser when they're making their cult statements. Frankly, I don't even know much about him, but I think Schiff anyway seems to be only playing on the side of "pay attention to me!" every time i see his nonsense tweets.

Frequentlyhere

Re: this whole thread, I'm relatively late to it, but from the tone of recent pages I'd say it's a shining light of decency and pleasant discussion compared to any other Bitcoin discussion I've read recently.  Yes, there's some childishness, brigading, arrogance and nonsense, but hey - welcome to the internet!

lozzy1965

My take on this thread:  Too many long posts that I don't want to devote the time to read! And:
Bitcoin IS NOT a currency yet.
Bitcoin IS NOT a store of wealth yet.
Bitcoin WILL NOT solve the 'broken fiat system' because it's not broken.
Bitcoin IS looking for a use.
Currently it has no value other than perceived future possibilities.
Currently, all it is is another asset class to bet on.
Confidence is everything in investing.  Bitcoin still needs a wider uptake and greater confidence and it needs regulation - which is a 180 with the reason for its invention.  We are currently at a crossroads where Bitcoin genuinely could go to zero - or very close to - in my opinion.  If it gets through this tough period then who knows.

On the other hand, I know nothing about anything!

uk1

fwor said:

darren232002 said:

The exposition of nuance and technical knowledge takes time.

And, as you can see, he is also a master of condescension.

Surely Darren232002 blew any credibility that he might have had here by writing this:

darren232002 said:

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

To be honest, if the quality of your reasoning is such that you conclude that because someone says something that is wrong or perhaps even dumb - or simply turns out to be wrong because the situation has evolved - then that in your opinion that means that they have no credibility, then I presume that to be consistent and fair to those others you  judge so harshly you use that same rather bewilderingly high bar to every pronouncement that you have ever made.  It is possible for extremely clever people to say dumb things at times and if you were as clever as you appear to consider yourself to be,  then you would have understood that and understand you have something to learn from almost anyone in life. 

Also, to really make progress with learning in life you also have to perhaps reluctantly accept and learn that you can learn from people you think you do not like as much as from people you do.  You certainly will logically find that you will learn much more from listening to those  who hold different views to your own than by simply listening to people that agree with you.

I predict that you will find something or other in this note to disagree with instead of considering whether  I’m making a reasonable point …. but hey ho.  

Jeff

benwhistler

I feel like a lot of people probably aren't familiar with the way Bitcoin tends to get discussed online. Darren's comments on here are very much par for the course in that they're effectively promoting Bitcoin rather than analysing it as an investment opportunity. The way people tend to do that online often follows a similar pattern.

First they try to establish credibility. This usually involves emphasising their intelligence and success. Darren claims to have a mathematical background, makes vague comments about how he was exposed to Bitcoin due to his previous work (implying some kind of sophisticated appreciation of the technology from an insider's perspective), claims to have invested in Bitcoin at an opportune time, implies he has substantial wealth, suggests he has an advanced understanding of statistics, and so on. Some of this might be true or it might all be made up (the statistics thing on the last page was particularly unconvincing given the slightly odd reference to using MATLAB for basic regression analysis) but it doesn't really matter, it's all about reeling people in with the appearance of being highly educated and successful.

Second, people who are promoting Bitcoin often make a number of claims about it that are largely based on some privileged vision of the future that only they have access to. It usually boils down to them appearing to have an inside track on future trends but emphasising that your time to act by investing in Bitcoin is limited so you'd better move quickly. Darren has made countless statements like the one below that follow this format: 

The end state of Bitcoin will be a globally adopted asset that is incredibly liquid and stable. It will be the boring asset you plan for your retirement in, like bonds today. The volatility is decreasing over time and will continue to do so. But the time for buying it for returns at that point will be gone.

Of course in the real world, nobody knows what the "end state" of Bitcoin will be and the evidence that's been posted to justify these claims is lacking. For instance, he's claimed on multiple occasions that volatility in Bitcoin "is decreasing over time and will continue to do so". Yet he attempted to evidence this on the last page and actually just pasted some simple charts that fall far short of proving what he's saying. The first is just the standard deviation of daily returns which he then described by saying "it seems pretty clear that a moving average of this line would be trending down over time". That isn't sophisticated statistical analysis, it's just eyeballing a simple chart. Modelling Bitcoin's future volatility in the long-term is practically impossible and if Darren were capable of doing this he would be best served by publishing it in a leading academic journal rather than spending hours upon hours arguing with people on the MSE forum.

The point in all this isn't to make robust, evidenced arguments, it's just about having the appearance of credibility and convincing people (especially inexperienced investors) that there's some time-limited opportunity to put money into Bitcoin and get once in a lifetime returns. If you actually go through everything he's posted on here it's like an exercise in throwing spaghetti at a wall, where he appears to know not only how Bitcoin will develop but also how the entire world economy and global society will look decades from now. The reality of investing is that we don't have a clue what's going to happen next week, far less decades from now. 

Third, those who promote Bitcoin tend to relentlessly attack anyone who doubts their claims. Darren again is pretty par for the course in this - everyone who says anything remotely nuanced gets hit with a 3,000 word diatribe that it would take them all day to respond to. In no sense is this a normal way to discuss investing. I invest in a number of things including some single stocks and it would never enter my mind to come on here and argue for hours on end about my investment strategy. It's just fundamentally weird to do this unless you're explicitly trying to promote something.

So why do people act this way with Bitcoin? For some people it's because they're just trying to pump up something they're already invested in. The internet has been full of that for years and a high percentage of media experts/analysts fall into this camp. For others, they do this because they've gone down a rabbit hole on the internet and have bought into it completely. These people tend to treat Bitcoin like a facet of their identity, a bit like their political ideology or religion. Again, fundamentally weird. Which camp Darren falls into is anybody's guess, but if anyone wants some advice, never ever invest in something because someone told you they know what the future will look like.

Zola.

Bit harsh, in my view...and not lacking in word count yourself... 

A valid reason for long posts discussing bitcoin at such a level is that it is incredibly fascinating and also takes a long time to actually understand deeply. It is profoundly different from fiat money, which is just another idea that everyone is used to. 

If it does go where many believe it to be then its a monetary game changer for the world. Not going to happen smoothly after 13 years. 

bugbyte_2

benwhistler, brilliant first post and encapsulates my thoughts exactly, all be it a lot more elegantly than I could write.

 I think darren in his response to my post demonstrated exactly what I was trying to say. Take the two points I happened to mention:

Volatility: As darren picked out deviation, the following is factually correct: Number of days bitcoin swung more than two deviations from its average:

2017  23
2018  21
2019  18
2020  10
2021  19

 As you can see, 2021's figure is 9 days more than 2020, therefore volitivity on this measure has gone up year on year. Interesting to see what 2022 will look like but I bet it is more than 23 days, probably already.

Energy use: In darren's response to my concern on energy use, he never once addressed the issue, but wrote several paragraphs on how ESG investing is a scam and something about carbon offsets and airlines. The weight of words in the response gives the impression of knowledge, but actually says nothing at all.

As this is a common occurrence, can I add 'mis-direction' and 'excessive word count' to your list?

 I admit I do find the methods used to gain credence here fascinating.