Cryptocurrencies

[ValueArb]

https://web.archive.org/web/20221027180943/https://www.sequoiacap.com/article/sam-bankman-fried-spotlight/

 

Sequoia tried to scrub their blog post crowing about investing with Sam Bankman Fried from the internet but through the way back machine it lives on as a magnificent example of mythological hagiography. Its quite an enjoyable read given today's reality, though I admit I was surprised by the inappropriateness of this particular description.

 

An awkward beat later, SBF broke, slayed by the silent force of Ellison’s four-eyed gaze.

[Castanza]

15 minutes ago, ValueArb said:

 

As the universe disappears into nothingness billions of years from now there will still be someone somewhere drinking a Coca-Cola.

 

And they'll pay for that Coke with BTC or Gold 

[Fly]

16 hours ago, ValueArb said:

 

And who said someone calling it a "currency" actually makes it a viable currency? Again, fluctuating 80% a year in price doesn't make anything a viable currency.

 

So true, just look at JPYUSD chart. Dead currencies everywhere!

[rkbabang]

17 minutes ago, Fly said:

 

So true, just look at JPYUSD chart. Dead currencies everywhere!

 

 

Or just look closer to home at the CADUSD chart.  11/2007 it was 1.0695, but a year later 11/2008 it was down over 26% to 0.7868, then in 04/2001 it was up over 32% to 1.0452, now it is down over 30% below that at 0.7261.    How do Canadians use such a volatile currency?  Can you even call the Canadian Dollar a currency? Here in the US $1 = $1, but over in other countries their currency fluctuates like crazy.   

 

Yes this is how stupid it is to use the market value of another currency against the dollar to say that it is far too volatile to be used.

 

[ValueArb]

15 minutes ago, rkbabang said:

 

 

Or just look closer to home at the CADUSD chart.  11/2007 it was 1.0695, but a year later 11/2008 it was down over 26% to 0.7868, then in 04/2001 it was up over 32% to 1.0452, now it is down over 30% below that at 0.7261.    How do Canadians use such a volatile currency?  Can you even call the Canadian Dollar a currency? Here in the US $1 = $1, but over in other countries their currency fluctuates like crazy.   

 

Yes this is how stupid it is to use the market value of another currency against the dollar to say that it is far too volatile to be used.

 

 

Yep, a currency that fluctuates 30% on average every five years is just like a cryptocurrency that fluctuates well over 50% every single year. Must mean CAD is no safer a currency than BTC, or SafeMoon, TerraUSD, Luna, Celsius, FTT, etc;) 

[rkbabang]

How did the US currency do the first 10 years after it was introduced?  There used to be a saying "Not worth a continental". (look it up) 

 

 Anyway, <sigh>, it's about time to give up this discussion as it's going in circles.  I'll just quote Satashi himself:

 

“If you don't believe it or don't get it, I don't have the time to try to convince you, sorry”

   --Satoshi Nakamoto

[TwoCitiesCapital]

3 hours ago, Castanza said:

 

And they'll pay for that Coke with BTC or Gold 

 

Though I'm skeptical coke will be around in a billion years. Can't even recall the last time I had one myself and without other brands owned by coke, pretty the volume of soda in general is probably down over the last 10-years. 

 

2 hours ago, rkbabang said:

 

 

Or just look closer to home at the CADUSD chart.  11/2007 it was 1.0695, but a year later 11/2008 it was down over 26% to 0.7868, then in 04/2001 it was up over 32% to 1.0452, now it is down over 30% below that at 0.7261.    How do Canadians use such a volatile currency?  Can you even call the Canadian Dollar a currency? Here in the US $1 = $1, but over in other countries their currency fluctuates like crazy.   

 

Yes this is how stupid it is to use the market value of another currency against the dollar to say that it is far too volatile to be used.

 

 

Like I said, it's a lazy argument that breaks down when applied to anything other than a biased view of BTC. Despite the supposed negative blot of volatility, BTC still has outperformed EVERY fiat currency over a 5-year period  

 

But weld prefer to have long-term savings in depreciating currencies for certainty of value?

[rkbabang]

22 minutes ago, TwoCitiesCapital said:

Though I'm skeptical coke will be around in a billion years. Can't even recall the last time I had one myself and without other brands owned by coke, pretty the volume of soda in general is probably down over the last 10-years. 

 

I don't know about a billion years, but I am confident that Coke, Bitcoin, and the use of Gold as a form of savings will all outlast the USD.

 

[TwoCitiesCapital]

All this upward volatility making my head hurt. Should probably move to USD....

[rkbabang]

59 minutes ago, TwoCitiesCapital said:

All this upward volatility making my head hurt. Should probably move to USD....

 

 

Yes, very disturbing. The USD chart is far more comforting to many people.

 

 

 

[gfp]

So we use the Us Dollar as our unit of account, like the metric system or something like that, but we don't "invest" in the US Dollar by taking a position in currency and calling it a day.  We buy productive assets of various types.  We just keep score in US dollar.  Even Bitcoin folks seem to keep score in the US dollar unit of account - every BTC thing I see is quoting the BTC-US Dollar cross.

 

So with Bitcoin or other Cryptocurrencies I guess the idea is to invest in the currency itself and that's it - hold "cash," wait, profit?

 

 

[ValueArb]

37 minutes ago, gfp said:

So we use the Us Dollar as our unit of account, like the metric system or something like that, but we don't "invest" in the US Dollar by taking a position in currency and calling it a day.  We buy productive assets of various types.  We just keep score in US dollar.  Even Bitcoin folks seem to keep score in the US dollar unit of account - every BTC thing I see is quoting the BTC-US Dollar cross.

 

So with Bitcoin or other Cryptocurrencies I guess the idea is to invest in the currency itself and that's it - hold "cash," wait, profit?

 

 

 

It has worked for BTC, at least so far. I'd rather own productive assets that generate 10%+ returns in USD, and incur the 2-3% in USD depreciation each year for a near guaranteed 7%+ annual appreciation over long periods than to hold an electronic accounting mark with zero yield or assets. But obviously I'm a tiny minority on this thread.

[SharperDingaan]

On 11/7/2023 at 5:24 PM, gfp said:

So we use the Us Dollar as our unit of account, like the metric system or something like that, but we don't "invest" in the US Dollar by taking a position in currency and calling it a day.  We buy productive assets of various types.  We just keep score in US dollar.  Even Bitcoin folks seem to keep score in the US dollar unit of account - every BTC thing I see is quoting the BTC-US Dollar cross.

 

So with Bitcoin or other Cryptocurrencies I guess the idea is to invest in the currency itself and that's it - hold "cash," wait, profit?

 

 

 

No different to someone in the US investing in the shares of some other company outside of the US (Canadian Oil Sands, Swiss Banks, etc.). Your great return on the year may well be little more than your unit of account (USD) simply devaluing against the foreign currency  The USD/CAD trade is attractive 'cause CAD also periodically revalues about once/decade. Today's low cost oil sand investment  bought at 73c in the dollar, sold at a much higher price later, and the funds repatriated at 1.03 in the dollar; the FX gain alone - repaying much of your mortgage 

 

SD     

Edited November 9, 2023 by SharperDingaan

[Castanza]

8 minutes ago, ValueArb said:

 

It has worked for BTC, at least so far. I'd rather own productive assets that generate 10%+ returns in USD, and incur the 2-3% in USD depreciation each year for a near guaranteed 7%+ annual appreciation over long periods than to hold an electronic accounting mark with zero yield or assets. But obviously I'm a tiny minority on this thread.

You’re betting on the US system..BTC owners are betting on the global system. 
 

2-3% who comes up with those numbers? 

[TwoCitiesCapital]

1 hour ago, Castanza said:

You’re betting on the US system..BTC owners are betting on the global system. 
 

2-3% who comes up with those numbers? 

 

Was more than that this year. Was 7-9% last year. But who's counting? 

[giulio]

6 hours ago, rkbabang said:

If you don't believe it or don't get it, I don't have the time to try to convince you, sorry”

   --Satoshi Nakamoto

Who exactly are you quoting?

Seriously, who's the "father" of this wonder?

[rkbabang]

7 minutes ago, giulio said:

Who exactly are you quoting?

Seriously, who's the "father" of this wonder?

Does it matter?  The code stands on its own. Which is why he remained anonymous. Bitcoin has no leader and it doesn’t need one.

[giulio]

I think it goes against human nature not to take credit for something like btc. You inveted digital gold and don't want to explain it on cnbc? 

I have never seen a "leader" of a currency (or gold). Lots of leaders in cults though.

Keep the faith! 

[TwoCitiesCapital]

18 minutes ago, giulio said:

I think it goes against human nature not to take credit for something like btc. You inveted digital gold and don't want to explain it on cnbc? 

I have never seen a "leader" of a currency (or gold). Lots of leaders in cults though.

Keep the faith! 

 

Well, he's either dead OR not subject to similar motivations as the rest of us . Because if he's still alive, he's one of the richest men in the world and hasn't touched a cent of it. 

Edited November 8, 2023 by TwoCitiesCapital

[rkbabang]

3 hours ago, TwoCitiesCapital said:

 

Well, he's either dead OR not subject to similar motivations as the rest of us . Because if he's still alive, he's one of the richest men in the world and hasn't touched a cent of it. 

That’s the reason I personally think Satashi was Hal Finney. He passed away in 2014. I can’t imagine anyone could have that much wealth and never touch it. Whoever he was he must be dead and his keys lost.

[Dave86ch]

8 hours ago, giulio said:

Who exactly are you quoting?

Seriously, who's the "father" of this wonder?

 

[ValueArb]

Quote

One of OpenSea’s biggest investors has marked down by 90% its stake in the struggling non-fungible-token marketplace, implying that the former crypto darling is now valued at $1.4 billion or less on paper. Coatue Management, a New York–based hedge and venture fund, slashed the value of its $120 million stake in the company to $13 million as of the second quarter of this year, according to a document viewed by The Information.

 

[ValueArb]

NYT opinion piece today from Molly White.

 

Quote

 

FTX is perhaps the best known catastrophe, but the same pattern has played out for customers of the Celsius cryptocurrency lender’s CEL token, the Voyager Digital broker’s VGX and the Terra/Luna ecosystem’s LUNA. Civil and criminal cases have revealed internal conversations among Celsius executives desperately trying to support the CEL token price to keep the floundering company afloat, to no avail, knowing what the token’s collapse would mean for the company. Binance, a still-operational exchange whose balance sheets are as opaque as those of the Bankman-Fried companies before their collapse, heavily promotes its BNB token. The extent to which the company relies on BNB to finance its operations is unclear, but history provides ominous warnings.

 

The collapse of the FTX exchange revealed the massive duplicity underlying many crypto exchanges, but its implosion should not be attributed to that alone. It, like so many companies in the cryptocurrency industry, had propped itself up on an imaginary foundation of tokens it had invented, and that foundation was bound to fail eventually. When the next company in its position falls, the only surprise should be that people expected any other outcome.

 

 

https://www.nytimes.com/2023/11/08/opinion/fraud-crypto-ftx-trial.html

[rkbabang]

6 minutes ago, ValueArb said:

 

Yeah, I think people are rethinking paying thousands or millions for JPGs of cartoon animals.  As I've said before in this topic, the concept of an NFT on a blockchain is a valuable one.  It could replace things like registries of deeds.  It could be used to prove ownership of all types of properties making proof of ownership and transferring property quicker and easier. But the thing you are owning is what has the value, not the NFT itself.  Eventually ownership of actually valuable art, homes, cars, and even companies could be traded as NFTs on a blockchain replacing deeds and stock markets. Who cares if I own a jpg of a cartoon ape if it's worthless?

[ValueArb]

1 hour ago, rkbabang said:

Yeah, I think people are rethinking paying thousands or millions for JPGs of cartoon animals.  As I've said before in this topic, the concept of an NFT on a blockchain is a valuable one.  It could replace things like registries of deeds.  It could be used to prove ownership of all types of properties making proof of ownership and transferring property quicker and easier. But the thing you are owning is what has the value, not the NFT itself.  Eventually ownership of actually valuable art, homes, cars, and even companies could be traded as NFTs on a blockchain replacing deeds and stock markets. Who cares if I own a jpg of a cartoon ape if it's worthless?

 

The multi-trillion dollar question for crypto is will anyone be able to connect it to the physical world in a trustworthy and efficient way. If they do the possibilities are endless, but there are many impediments. Things like oracles aren't necessarily trustworthy, they can crash, get hacked, be fed false data, be mis-programmed, return data thats inconsistent with the expectations of the contracts/people relying on them, etc. 

 

More specifically, think about real estate titles being stored on the block-chain. The vision is that instead of paying 5% to a couple of agents and paying a title agent to insure that the title is clear a smart contract can instantly assign your property's title to the buyer as their funds clear into your wallet. But the problems that need to be solved are many. First, you still need inspections, you still need punch lists of things to address before the deal can close. The buyer still needs financing, and you might have to provide it. You still need agents to show and advertise the property for you unless you want to take on a lot of work, and a central registry of for sale properties.

 

So probably at most, the block-chain eliminates title insurance, and that's still hard. How does the block-chain to a title search to ensure there are no outstanding claims so that you don't end up buying property with disputed ownership? How does it prevent bad actors from adding fake titles to it? What if someone gets your private key and transfers your title to themselves? How hard would it be to undo these things? The current system has a ton of protections and works very well, block-chain can't replace it unless it addresses these problems just as well, and at a lower cost.