Bitcoin - Cryptocurrency

[Butterscotch4days]

I mined some. Nearly ruined my video card. Now I do AI related things with it instead of wasting electricity. I still have 564 ravencoin, which I used to buy an impressive headphone setup for basically $30/month extra in power.

Do not buy, trade or steal crypto. Figure out if you want to mine/hash/sell GPU cycles but do not invest in this market unless you are willing to seriously risk your health and sanity.

 

[teletina]

 

[Linderflomann]

There is no difference whatsoever between what you call 'bros' - ignorant, uninformed enthusiasts - and uninformed ignorant critics, who repeat nonsense like 'it's just for criminals', 'it's all a scam from the start', 'you can't buy anything with it anywhere' etc.

One side is actively working to get people scammed and/or put their money into highly risky investments, the other is trying to get people not to do that.

Big brained take: "They are the same."

 

[PoorNoodle]

A good lecture about Crypto. A bit technical but good. Brings up all the pros and cons.

 

[chris m.]

A good lecture about Crypto. A bit technical but good. Brings up all the pros and cons.

I listened to a good analysis of crypto by the podcast, Freakonomics. My conclusions- 1) digital dollars issued by USA, and other digital currencies are likely coming, and would eliminate the need for non-sovereign tokens for the vast majority of folks; 2) most of current token valuation is a speculative bubble; 3) while something like a block chain ledger could theoretically speed up rate of value exchanges compared to current bank-to-bank transfer verification, and possibly reduce frictional costs, the juice probably ain’t worth the squeeze. They noted that bitcoin can process about 7 transactions per second while VISA processes thousands of transactions per second.

 

[boris bubbanov]

I've been asking some of my country friends, to explain to me how this stuff works. Even the ones who attempt to explain it back to me, can't explain effectively. IMO.

My humble suggestion is, a monetary unit works best when a significant share of the population has some concept of how it works. If the vast percentages of folks in this world are lost, when the best try to explain to them how this works, you have a problem. You'll never attain the kind of rock hard confidence you'll need to instill for the currency to work. If I may say so, this stuff is Elitism at its worst.

 

[chris m.]

Here's a link to the Freakonomics podcast I mentioned earlier. It is the first in a series about blockchain. I think it is pretty informative and that anyone, including non-elites, can learn a lot from it.

One really interesting thing is how even true experts who get paid to study this stuff in great depth have an extremely wide range of views on the long-term potential value of this technology. So it's definitely a bit of a moon-shot investment as a long-term, truly game-changing technology, once you put aside all the Dutch-tulip-style speculation.

Given the known intrinsic pros and cons, I'm definitely on the skeptical side of the spectrum, even independent of the current speculative bubble aspects of everything associated with it. I.e., even if there were no speculative bubble I'd still be leery of it.

One thought I have is that to the extent that the technology might truly result in increased efficiencies in terms of speed or cost of verifiably transferring value, there is nothing to stop the mainstream banking system and the sovereign currencies from using the technology. Maybe some of the current start-up companies would find a long-term profitable niche as paid consultants to help the Establishment adopt these things, but I don't see it as replacing the Establishment.

As an analogy, some people think that modern medicine is quackery and that essential oils are better medicine. If any science-based evidence were to reveal that essential oils actually do work better than other "western" drugs, then the medical establishment would start using them, too. Thus, essential oils businesses would not ultimately replace the current medical establishment, because the establishment would just incorporate it into their existing, already dominant system.

Does the Crypto Crash Mean the Blockchain Is Over? - Freakonomics

No. But now is a good time to sort out the potential from the hype. Whether you’re bullish, bearish, or just confused, we’re here to explain what the blockchain can do for you. (Part 1 of a series.)

freakonomics.com

 

[THX1123]

This is a true story, but it is apt. The names have not been changed because it doesn't matter.

When I was in 5th grade we started to make our own little paper money with heavy paper and green ink pen. We traded them around for matchbox and hotwheels cars. It was fun because we all agreed they had value in our own little fantasy world. Some of the other kids couldn't make little dollars as well as those of us who had art skills and green pens, so they wanted ours. We started to buy all the best matchbox and hotwheels cars and erasers and suchlike in class with the little dollars.

I started it. I needed a pencil. Trent jokingly told me he would sell me one for $100. I made a little $100 bill to pay for it.

Then Rick made a $10,000 bill. Rodney made a$1,000,000 bill. We made them small so it was hard to draw them. Once everyone who could draw well enough and who had a green pen started making their own currencies none of them had the value they had had the day before. Before that happened I sold a matchbox car for 1,000,000 Rodney Dollars.

Then Scott made an infinity dollar. His one infinity dollar ruined the game. It was the ultimate scarcity because there was only one. So of course we all made our own infinity dollars. I realized I had no matchbox car and both my 1,000,000 Rodney dollars and infinity dollar weren't worth anything anymore.

Trent is now a successful engineer. Scott spent 15 years in jail in his 20s for drug charges and other despicable things and now lives in Thailand and I don't think he can ever come back to the USA.

 

[chris m.]

This is a true story, but it is apt. The names have not been changed because it doesn't matter.

When I was in 5th grade we started to make our own little paper money with heavy paper and green ink pen. We traded them around for matchbox and hotwheels cars. It was fun because we all agreed they had value in our own little fantasy world. Some of the other kids couldn't make little dollars as well as those of us who had art skills and green pens, so they wanted ours. We started to buy all the best matchbox and hotwheels cars and erasers and suchlike in class with the little dollars.

I started it. I needed a pencil. Trent jokingly told me he would sell me one for $100. I made a little $100 bill to pay for it.

Then Rick made a $10,000 bill. Rodney made a$1,000,000 bill. We made them small so it was hard to draw them. Once everyone who could draw well enough and who had a green pen started making their own currencies none of them had the value they had had the day before. Before that happened I sold a matchbox car for 1,000,000 Rodney Dollars.

Then Scott made an infinity dollar. His one infinity dollar ruined the game. It was the ultimate scarcity because there was only one. So of course we all made our own infinity dollars. I realized I had no matchbox car and both my 1,000,000 Rodney dollars and infinity dollar weren't worth anything anymore.

Trent is now a successful engineer. Scott spent 15 years in jail in his 20s for drug charges and other despicable things and now lives in Thailand and I don't think he can ever come back to the USA.

When I was in junior high school at King Junior High in Berkeley, CA my buddy and I would regularly skip school and take BART to Chinatown in S.F. There we would buy a brick (80 packs) of firecrackers for 10 cents a pack in a back alley. Then we would take BART out to Orinda or Walnut Creek, walk to the local junior high school, and sell the firecrackers for 30 cents a pack. I don't know what happened to my buddy. I haven't done any jail time (yet).

 

[boris bubbanov]

I'm just saying, there's a future out there and someone is going to explore it and bully for all that. I'm just not prepared to get out my wallet and start handing over bills and bills because someone uses the word "Nanotechnology" or "Blockchain". I am willing to be the one left behind, as I think society wants to be just and to look after the stragglers and society wants to reach out and bean the folks who get too far ahead of the pack. One of my favorite expressions is:

The Early Bird Gets the Stone.

Being out front is never a guarantee of anything.

 

[Synchro]

This is a true story, but it is apt. The names have not been changed because it doesn't matter.

When I was in 5th grade we started to make our own little paper money with heavy paper and green ink pen. We traded them around for matchbox and hotwheels cars. It was fun because we all agreed they had value in our own little fantasy world. Some of the other kids couldn't make little dollars as well as those of us who had art skills and green pens, so they wanted ours. We started to buy all the best matchbox and hotwheels cars and erasers and suchlike in class with the little dollars.

I started it. I needed a pencil. Trent jokingly told me he would sell me one for $100. I made a little $100 bill to pay for it.

Then Rick made a $10,000 bill. Rodney made a$1,000,000 bill. We made them small so it was hard to draw them. Once everyone who could draw well enough and who had a green pen started making their own currencies none of them had the value they had had the day before. Before that happened I sold a matchbox car for 1,000,000 Rodney Dollars.

Then Scott made an infinity dollar. His one infinity dollar ruined the game. It was the ultimate scarcity because there was only one. So of course we all made our own infinity dollars. I realized I had no matchbox car and both my 1,000,000 Rodney dollars and infinity dollar weren't worth anything anymore.

Trent is now a successful engineer. Scott spent 15 years in jail in his 20s for drug charges and other despicable things and now lives in Thailand and I don't think he can ever come back to the USA.

This is a perfect example of the folly of speculation. Value amounts to an agreement, and so long as the agreement remains in place. As soon as the agreement is invalidated, for whatever reason, value becomes negotiable.

The first hand drawn $100 bill was novel, and rare, so it had real, albeit quite temporary, value. By the next day, you had a million worthless “dollars“ and no Matchbox car. Sadly, a lot of people do not understand this.

I once spoke to a man who was convinced that the value of his real estate would continue to increase, forever. In my humble opinion, he couldn’t have been more wrong. The price may go up, but the value is based upon supply and demand, which is influenced by much more than currency. Interest rates have an effect on real estate prices, because the long term cost goes up with higher interest, so people are not willing to spend as much, which decreases demand and prices have to come down, or there will be a lot of unsold property. My point is that every boom is followed by a bust.

 

[chezdeluxe]

Why is it that if you want to purchase crypto you have to use traditional currency to buy it?

Unless of course you have some smoke and mirrors that you can trade.

 

[Linderflomann]

Does the Crypto Crash Mean the Blockchain Is Over? - Freakonomics

No. But now is a good time to sort out the potential from the hype. Whether you’re bullish, bearish, or just confused, we’re here to explain what the blockchain can do for you. (Part 1 of a series.)

freakonomics.com

I started listening, about 15 mins in, but does it actually get critical at any point? Right now it has just been acting as a mouthpiece for some of the worst people in the space, with ridiculous arguments: like that crypto is supposed to counter hyper-inflatation, like in Zimbabwe and Argentina. How is that even supposed to work? They want poor people in developing countries to put their hard earned cash into a highly speculative asset, and that's supposed to protect them from the whims of the market?

There is a general tendency I have seen with Freakonomics: they go into some topic, they say "is x really as bad as people say it is?" and then they let the CEO of x talk about how, no, people are totally wrong about x being bad. I don't know what's going on behind the scenes, but I almost get the sense the podcast is paid advertisement these days. But maybe I'm paranoid.

Here's a thread to illustrate how FoS these people are: https://nitter.net/liron/status/1540035327665967105

 

[SecretSquirrel]

in 5th grade we started to make our own little paper money with heavy paper and green ink pen. We traded them around for matchbox and hotwheels cars. It was fun because we all agreed they had value in our own little fantasy world. Some of the other kids couldn't make little dollars as well as those of us who had art skills and green pens, so they wanted ours. We started to buy all the best matchbox and hotwheels cars and erasers and suchlike in class with the little dollars.

That's a really cute story!

This "classroom economy" might have worked if the hand-drawn notes were issued by some school authority, e.g. the teacher—say, for completing homework tasks, or cleaning the chalkboard, etc. But to truly create a demand for the teacher's notes, they would only have value if the teacher also imposed a tax on every student, or levied fees & fines for certain things—payable in the hand-drawn notes that the teacher previously issued.

Since most or all students would sooner or later need some of the teacher notes, they do what's necessary to earn or acquire them.

The students discover they can exchange the notes amongst themselves, for others' Hot Wheels and so on, and relative 'prices' are settled, denominated in teacher notes. One student might get out of cleaning the blackboard by selling some of his glass marbles to another student, and paying his teacher 'taxes' with the acquired notes.

The teacher realizes that imposing obligations payable only in 'teacher notes' also prevents the notes from excess accumulation in the classroom economy. If the students managed to set aside enough notes, they might stop doing homework and cleaning the blackboard. So by adjusting the "recall" or "redemption" rate of the notes, the teacher exerts some control over their abundance or scarcity.

That's how today's actual money systems work, just change the names and a few details. And this is why bitcoin won't work as a money of account: there's no incentive to form a collective demand for it. Bitcoin is a bit like the kids in the classroom drawing "money" notes with green pens on cardstock. Unlike the schoolkids drawing notes, bitcoin does limit the supply of tokens—but it also fixes the quantity, which was the bug, not the feature, of metal-based money systems.

 

[SecretSquirrel]

Why is it that if you want to purchase crypto you have to use traditional currency to buy it?

Right, bitcoin is something that goes in the shopping cart, not what you use to pay at checkout.

Brett Scott has written some illuminating articles about this...

"I used time-travel to uncover three secret messages hidden in a popular Bitcoin meme"​

I used time-travel to uncover three secret messages hidden in a popular Bitcoin meme

And in the process revealed one deep truth underneath it all

brettscott.substack.com

 

[HappyMangle]

A good lecture about Crypto. A bit technical but good. Brings up all the pros and cons.

Thanks for sharing! I am learning now about everything about cryptocurrencies what i can find online as i am planning to buy a crypto license here in the future. The good thing about the whole process - i can do it online without too much hustle, all i need is my knowledge and a desire to succeed in this business. I think cryptos are our future and want to be ahead of this topic.

 

[chris m.]

I started listening, about 15 mins in, but does it actually get critical at any point? Right now it has just been acting as a mouthpiece for some of the worst people in the space, with ridiculous arguments: like that crypto is supposed to counter hyper-inflatation, like in Zimbabwe and Argentina. How is that even supposed to work? They want poor people in developing countries to put their hard earned cash into a highly speculative asset, and that's supposed to protect them from the whims of the market?

There is a general tendency I have seen with Freakonomics: they go into some topic, they say "is x really as bad as people say it is?" and then they let the CEO of x talk about how, no, people are totally wrong about x being bad. I don't know what's going on behind the scenes, but I almost get the sense the podcast is paid advertisement these days. But maybe I'm paranoid.

Here's a thread to illustrate how FoS these people are: https://nitter.net/liron/status/1540035327665967105

I think the show lets the pro crypto folks reveal how delusional they are by letting them talk. More objective voices later in the podcast put additional nails in the coffin.

 

[FuzzWatt]

Being under the age of 35 it's expected I know everything about crypto, and to be frank, I'm getting tired of the incredulous looks and smirks when I tell peers I have no idea what it's about and I don't care to.

I prefer schemes and money to stay far apart.

 

[Jimmy Dean]

I always seek financial advice from some schmo on a guitar forum, yeah right.

 

[chris m.]

The subsequent podcast on Freakonomics- #509: "Are NFTs all scams?" actually described an application that I think has real potential. The Ethereum platform includes the ability to code, and this code can be used to create automated contracts. How would this work?

For example, right now if you want to set up a trust for your kid that she will inherit when you die, you need to have the trust be managed by a trustee, for which there is a fee, typically. You have to trust the trustee to dole out the money in the trust according to your wishes. But think of those wishes in the form of an if-then statement: IF my daughter is greater than or equal to 25 years old, AND IF I am dead, AND IF she has a job, AND IF she has no misdemeanors or felonies, THEN she can receive $5k a month from the trust.

Rather than rely on a human trustee, in theory you could have an automated trust based in an Ethereum coded contract. There would be an electronic way for these conditions to be confirmed, and then the money would automatically be paid out with no human intervention involved. The ability to create "smart contracts" theoretically could thereby reduce a lot of friction in terms of both time and cost.

HOWEVER-- rather than replace the banking system and legal system that we have relied upon for centuries, I see these technologies as being co-opted by the traditional institutions. If BofA uses these tools and can provide a discounted service then they win over their competitors. So the real winners, ultimately, are the inventors of these things, provided they can establish and protect their patents and collect licensing fees for some period of time. At the end of the day the real value proposition is the intellectual property that has potential applications as add-ons or upgrades to the mechanisms currently employed by traditional institutions.