Do you think Bitcoin is a safe store of value?

[Rod]

Creating a currency or a commodity out of thin air, which is what bitcoin is, has to my knowledge never been achieved. Does anyone have any historical examples?

[rkbabang]

Creating a currency or a commodity out of thin air, which is what bitcoin is, has to my knowledge never been achieved. Does anyone have any historical examples?

 

I don’t think it is an exaggeration to say that it was never possible before. In all the history of mankind up until Satashi published his white paper, any currency created by man would have been easily inflated and would require you to trust the issuer. So no, there is no precedent.

[clutch]

Creating a currency or a commodity out of thin air, which is what bitcoin is, has to my knowledge never been achieved. Does anyone have any historical examples?

 

I don’t think it is an exaggeration to say that it was never possible before. In all the history of mankind up until Satashi published his white paper, any currency created by man would have been easily inflated and would require you to trust the issuer. So no, there is no precedent.

 

Wait, wasn't money created out of "thin air"?

[Rod]

Creating a currency or a commodity out of thin air, which is what bitcoin is, has to my knowledge never been achieved. Does anyone have any historical examples?

 

I don’t think it is an exaggeration to say that it was never possible before. In all the history of mankind up until Satashi published his white paper, any currency created by man would have been easily inflated and would require you to trust the issuer. So no, there is no precedent.

 

Wait, wasn't money created out of "thin air"?

 

Yes, technically true. But I was referring to currencies or commodities created by private entities. Governments clearly have the power to make a currency legal tender through spending, taxing, and regulation.

[Spekulatius]

Creating a currency or a commodity out of thin air, which is what bitcoin is, has to my knowledge never been achieved. Does anyone have any historical examples?

 

I don’t think it is an exaggeration to say that it was never possible before. In all the history of mankind up until Satashi published his white paper, any currency created by man would have been easily inflated and would require you to trust the issuer. So no, there is no precedent.

 

You can inflate the crypto currency by creating a new one. You can also inflate  the crypto currency by dividing it into smaller and smaller fractions. Since it is a virtual transaction token with no objective value, who cares?

[hobbit]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned . Fiat money provides more flexibility for the policy makers to arrest an economic downturn. 2008-09 crash was less worse than 1929 because of ability to print money. Having a fixed supply of bitcoin as a currency is shortsighted from an economic prospective .

 

Technical challenges of bitcoin core has rendered it useless as a currency.

 

Even though bitcoin was envisioned as a currency , the failure of it as a currency has lead people to highlighting bitcoin as a replacement of gold. Its not going to happen because it offers no game changing benefits over gold and you need to be a game changer to dislodge something which already works well ( Gold).

 

It is not anonymous unless you have some degree of technical sophistication which majority of people do not have. For majority of people cash/gold is far more anonymous than bitcoin .

 

This does not mean all cryptocurrencies will fail. Bitcoin will though.

 

 

 

 

[wachtwoord]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

[hobbit]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

 

 

Policy makers are messed up in their own ways but there is a very sound economic rationale behind why fiat is better than bitcoin.

[SnarkyPuppy]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned . Fiat money provides more flexibility for the policy makers to arrest an economic downturn. 2008-09 crash was less worse than 1929 because of ability to print money. Having a fixed supply of bitcoin as a currency is shortsighted from an economic prospective .

 

Technical challenges of bitcoin core has rendered it useless as a currency.

 

Even though bitcoin was envisioned as a currency , the failure of it as a currency has lead people to highlighting bitcoin as a replacement of gold. Its not going to happen because it offers no game changing benefits over gold and you need to be a game changer to dislodge something which already works well ( Gold).

 

It is not anonymous unless you have some degree of technical sophistication which majority of people do not have. For majority of people cash/gold is far more anonymous than bitcoin .

 

This does not mean all cryptocurrencies will fail. Bitcoin will though.

 

Not sure I understand how it has "no game changing benefits" as compared to gold when you can transact in bitcoin literally without an intermediary. 

[rkbabang]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned . Fiat money provides more flexibility for the policy makers to arrest an economic downturn. 2008-09 crash was less worse than 1929 because of ability to print money. Having a fixed supply of bitcoin as a currency is shortsighted from an economic prospective .

 

Technical challenges of bitcoin core has rendered it useless as a currency.

 

Even though bitcoin was envisioned as a currency , the failure of it as a currency has lead people to highlighting bitcoin as a replacement of gold. Its not going to happen because it offers no game changing benefits over gold and you need to be a game changer to dislodge something which already works well ( Gold).

 

It is not anonymous unless you have some degree of technical sophistication which majority of people do not have. For majority of people cash/gold is far more anonymous than bitcoin .

 

This does not mean all cryptocurrencies will fail. Bitcoin will though.

 

Not sure I understand how it has "no game changing benefits" as compared to gold when you can transact in bitcoin literally without an intermediary. 

 

Exactly.  Say you want to transfer $1B worth of gold to someone on the other side of the planet.  This would be much easier, faster, and cheaper to do in Bitcoin.

 

Say you want to leave the country and take your entire net worth with you.  You could literally memorize 12 english words and take a Billion dollars with you in your head.

 

 

[wachtwoord]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

 

 

Policy makers are messed up in their own ways but there is a very sound economic rationale behind why fiat is better than bitcoin.

 

No there's not. There is Keynesian dogma and brainwashing which a child understands is bullshit. People never spend their money if it increases in purchasing power? How naive must you be to buy that ... But believe what you wish. This falls under freedom of religion for me.

 

To the people not understanding why it's an improvement over gold I simply refer to this blogpost from 2012 http://moneyandstate.com/bitcoin-libertarian-introduction-used-care/

[SharperDingaan]

Gold serves as a 'store of value', because in troubled times everyone wants it - whichever side of the street they are on. The problem is that it's heavy, vulnerable to theft, and you cant prove this oz belongs to you. Bitcoin 1.0 running on a distributed ledger solves these issues - and that is part of its brilliance. We 'trust' because to the criminal element, it is worth far more to them to leave it unmolested - than to debase it.

 

Bitcoin 2.0 (CBDC) does the same as Bitcoin 1.0, except that a CB backs the token (value & liquidity). If we think of the CB as being a global versus national entity (ECB or World Bank versus US Federal Reserve), we would have the cyber equivalent of the gold 'store of value' function. We 'trust' the global CB (the force!) over the criminal element (the dark side!), but retain the ability to switch back to Bitcoin 1.0 at any time. 

 

Bitcoin 1.0 holders are about to discover what happens to price when there is no liquidity, CB's have already had the negative rates 'experience'; and neither are likely to want to repeat it. The basis for, and the 'plumbing' of the CBDC is well understood; and much of it has already been tested on the Corda platform. The options, futures, and collateral loan infrastructure supporting Bitcoin 1.0; is easily transferable to Bitcoin 2.0. It is no longer 'if' - it is 'when'.

 

Just one of the 'game changers' from the Nakamoto paper.

 

SD

 

 

 

 

 

 

[hobbit]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned . Fiat money provides more flexibility for the policy makers to arrest an economic downturn. 2008-09 crash was less worse than 1929 because of ability to print money. Having a fixed supply of bitcoin as a currency is shortsighted from an economic prospective .

 

Technical challenges of bitcoin core has rendered it useless as a currency.

 

Even though bitcoin was envisioned as a currency , the failure of it as a currency has lead people to highlighting bitcoin as a replacement of gold. Its not going to happen because it offers no game changing benefits over gold and you need to be a game changer to dislodge something which already works well ( Gold).

 

It is not anonymous unless you have some degree of technical sophistication which majority of people do not have. For majority of people cash/gold is far more anonymous than bitcoin .

 

This does not mean all cryptocurrencies will fail. Bitcoin will though.

 

Not sure I understand how it has "no game changing benefits" as compared to gold when you can transact in bitcoin literally without an intermediary. 

 

Exactly.  Say you want to transfer $1B worth of gold to someone on the other side of the planet.  This would be much easier, faster, and cheaper to do in Bitcoin.

 

Say you want to leave the country and take your entire net worth with you.  You could literally memorize 12 english words and take a Billion dollars with you in your head.

 

you can transact in gold without intermediaries.

 

a transaction in bitcoin will take more than 24 hours to complete and given the volatility in price it will never be used to transfer large chunks of value.

 

if you are actually moving to a new country, no one is stopping you from taking ur money with you.

[hobbit]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

 

 

Policy makers are messed up in their own ways but there is a very sound economic rationale behind why fiat is better than bitcoin.

 

No there's not. There is Keynesian dogma and brainwashing which a child understands is bullshit. People never spend their money if it increases in purchasing power? How naive must you be to buy that ... But believe what you wish. This falls under freedom of religion for me.

 

To the people not understanding why it's an improvement over gold I simply refer to this blogpost from 2012 http://moneyandstate.com/bitcoin-libertarian-introduction-used-care/

 

the same Keynesian dogma prevented a depression like the one experienced post 1929....i would rather believe in reality than conspiracy theories.

[rkbabang]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

 

 

Policy makers are messed up in their own ways but there is a very sound economic rationale behind why fiat is better than bitcoin.

 

No there's not. There is Keynesian dogma and brainwashing which a child understands is bullshit. People never spend their money if it increases in purchasing power? How naive must you be to buy that ... But believe what you wish. This falls under freedom of religion for me.

 

To the people not understanding why it's an improvement over gold I simply refer to this blogpost from 2012 http://moneyandstate.com/bitcoin-libertarian-introduction-used-care/

 

the same Keynesian dogma prevented a depression like the one experienced post 1929....i would rather believe in reality than conspiracy theories.

 

What you meant to say is that the central bank didn't cause a depression this time like it did 1929.

[DeepSouth]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

 

 

Policy makers are messed up in their own ways but there is a very sound economic rationale behind why fiat is better than bitcoin.

 

No there's not. There is Keynesian dogma and brainwashing which a child understands is bullshit. People never spend their money if it increases in purchasing power? How naive must you be to buy that ... But believe what you wish. This falls under freedom of religion for me.

 

To the people not understanding why it's an improvement over gold I simply refer to this blogpost from 2012 http://moneyandstate.com/bitcoin-libertarian-introduction-used-care/

 

 

Before strong central bank control, the economy whip-lashed between inflationary booms and deflationary depressions on a decade by decade basis. You'd have to be insane to want to go back to that system.

 

http://www.in2013dollars.com/1800-dollars-in-2016

 

http://inflation.stephenmorley.org/

[Liberty]

http://thereformedbroker.com/2017/12/14/a-twist/

[rkbabang]

http://thereformedbroker.com/2017/12/14/a-twist/

 

This one is good as well: http://thereformedbroker.com/2017/10/18/an-evening-in-wonderland/

 

"The stampede is coming

I mentioned a few weeks back that you can practically smell it in the air – the big money is coming into this space. I can’t imagine how that doesn’t blow the price up into the stratosphere. For all of Jamie Dimon’s protestations, his firm is experimenting with cross-border transfers using blockchain. So is every other major financial institution – or at least they’re thinking about it and planning it.

The big rumor going around last night is that Goldman Sachs is going to launch market-making in crypto currency for their clients in the third quarter of 2018. I don’t know if that’s true or not, but multiple people who don’t know each other are saying it. And why wouldn’t they? If that’s what their customers are asking for (and they are), then of course they will. This is the institutionalization of something that right now is still on the fringes of finance. What will that mean for the prices of coins?

Pensions and endowments

Another thing that was kind of hinted at – pension and endowment money dipping a toe in. We’re talking about trillions of dollars in these pools. If even 1% of that starts looking for allocation, forget about it. Ari Paul from Blocktower says the pensions aren’t coming in until the custodian issues are worked out. With a traditional investment like a stock or a bond, your big risk is that they will drop in value. With crypto, you have that issue too, but then you have an added risk that you don’t have with stocks and bonds: Your holdings can disappear from theft! Nobody worries about their stocks being stolen. Everyone worries about their coins being hacked. Solidifying the custody system is going to take time.

Ari mentions that someone asked him “When will the University of Chicago buy in?” His reply is “Six months after Yale does.” Everyone laughs. But it’s true. The way Ari looks at it, right now, if someone at a college endowment takes the risk upon his or herself to buy Bitcoin, they face ridicule or a firing. But eventually, that career risk flips around the other way. Imagine someone from the Yale Endowment makes a splash in Bitcoin and gets written up everywhere for how forward-thinking they are. All of a sudden the CIOs at all the other endowments are being questioned “Why the hell didn’t you do that? Did you even look at it?” This is how manias are fueled, by the way – institutional ass-covering. They all did this with hedge funds in the 90’s and commodities in the 00’s. It hasn’t begun yet in this arena.

This is me talking – a major endowment announcing Bitcoin investments coupled with Goldman launching an exchange could be light’s out. That could be the sequence of events that causes a stampede."

[wachtwoord]

 

Before strong central bank control, the economy whip-lashed between inflationary booms and deflationary depressions on a decade by decade basis. You'd have to be insane to want to go back to that system.

 

http://www.in2013dollars.com/1800-dollars-in-2016

 

http://inflation.stephenmorley.org/

 

Before central banking we had short natural healthy cycles. After central banking we have huge bubbles like 1929 because the market isn't allowed to correct.

 

The US market before 1900 was great. That's when the Brityish injected the central banking poison pill from Europe.

[SharperDingaan]

The concept of blockchain is a breakthrough.

 

There was a reason gold standard was abandoned .

 

People seizing power and covertly stealing from the general population? The economy is best left untouched by 'policy makers'. They'll only fuck things up like they have shown throughout history.

 

 

Policy makers are messed up in their own ways but there is a very sound economic rationale behind why fiat is better than bitcoin.

 

No there's not. There is Keynesian dogma and brainwashing which a child understands is bullshit. People never spend their money if it increases in purchasing power? How naive must you be to buy that ... But believe what you wish. This falls under freedom of religion for me.

 

To the people not understanding why it's an improvement over gold I simply refer to this blogpost from 2012 http://moneyandstate.com/bitcoin-libertarian-introduction-used-care/

 

Very good stuff in this blogpost.

Thanks for posting.

 

SD

[Cardboard]

"An investment operation is one which, upon thorough analysis, promises safety of principal and an adequate return. Operations not meeting these requirements are speculative." — Ben Graham"

 

Cardboard

[DeepSouth]

 

Before strong central bank control, the economy whip-lashed between inflationary booms and deflationary depressions on a decade by decade basis. You'd have to be insane to want to go back to that system.

 

http://www.in2013dollars.com/1800-dollars-in-2016

 

http://inflation.stephenmorley.org/

 

Before central banking we had short natural healthy cycles. After central banking we have huge bubbles like 1929 because the market isn't allowed to correct.

 

The US market before 1900 was great. That's when the Brityish injected the central banking poison pill from Europe.

 

You're right that cycles were mostly shorter. They were short and violent, transitioning from double digit inflationary booms to deflationary depressions entailing banking system panics most decades. The economy shrank in real terms by 10% per capita over the entire decade between 1869 and 1879 as nominal wages shrank by a quarter. This is not the signs of a great US market. I thank God that sadists like you have no power over the economy.

[wachtwoord]

 

Very good stuff in this blogpost.

Thanks for posting.

 

SD

 

You're welcome.

 

@DeepSouth can you understand you're a masochist from my point of view? Anyway, let's just all vote with our wallets and things will work out at some point :)

[John Hjorth]

... DeepSouth can you understand you're a masochist from my point of view? ...

... I thank God that sadists like you have no power over the economy. ...

 

Just hilarious. And things still don't get out of hand. CoBF at its best!

[rkbabang]

... DeepSouth can you understand you're a masochist from my point of view? ...

... I thank God that sadists like you have no power over the economy. ...

 

Just hilarious. And things still don't get out of hand. CoBF at its best!

 

S&M on CoBF!

 

Maybe we need a new section for that.