Bitcoin Surpasses $4,000, Reaches Another Milestone | Hacker News Reader

Bitcoin Surpasses $4,000, Reaches Another Milestone

forbes.com

87 pointssndean82 comments

This is just speculative but the Bitcoin fork was probably the best thing to happen to the price of bitcoin.

http://amp.timeinc.net/fortune/2017/08/07/bitcoin-cash-bch-h...

weird question but why not fork more and people will trade it for BTC. at what point would it not work anymore?

A fork has to be an idea about what Bitcoin is. This fork worked because some people saw Bitcoin as a settlement layer for a wider system of credits. Other people saw Bitcoin as a monolithic currency. The distance between those ideas caused the split.

Similarly ETH saw Ethereum as a beta prototype, and ETC saw it as a final contract. Those two ideas were each strong enough to support a community.

But this doesn't work arbitrarily. If I see Bitcoin as a currency primarily for selling ice cream cones and I fork IceCreamCoin, which responds to the seasonality of ice cream sales, there's no guarantee other people will see value in that idea, and mine blocks on my chain, or pay for coins transacted in those blocks on exchanges.

This is key to understanding cryptocurrency: there is no central reality. There are as many realities as you want. There are incentives to participate in some of them, but it's voluntary. You can walk away from whoever you want, and decide their money doesn't even exist for you, for any reason.

This is a fantastic philosophical summary of what a cryptocurrency fork represents. Thank you for sharing.

At the point BTC isn't under pressure anymore. Both forks have value because people give them value. But two forks are worth more than one because it was under immense pressure to scale. It could be that the growth was stunted until the split but I think the fork gave people confidence and became more than the sum.

Forking again will probably not relieve any pressure. It wouldnt take off.

What's Bitcoin use case besides speculation?

Buying $10 worth of namecheap domain and pay $5 on fees no thanks!

You could currently pay a fee of about 5 cents and be confirmed likely within 3 blocks.

https://bitcoinfees.21.co/

This. I just bought 0.007 btc and sent it to a friend, and it cost less than 10 cents in fees overall.

Not sure how you came up with 5 cents but I get $1.36: 4000 dollars/btc * 10^-8 btc/satoshi * 150 satoshi/byte * 226 bytes/transaction = $1.356 per transaction

If you wanted to get confirmed in the very next block you could probably use 25 satoshi/byte at this point in time. Personally, if I were sending a non critical/time-sensitive transaction right now I would use about 5 satoshi/byte.

a decentralized, unseizable, cross-border, deflationary store of value. it's next-gen gold.

unstable and unusable. next-gen pyramid scheme

I sure hope so for your sake, because if the real bubble is fiat money, and you have 0 cryptocurrency, you are basically screwed.

If it comes to pass that "Not having crypto" = "screwed", then the chaos will be such that everyone's screwed, anyway.

Don't worry, people in hyperinflation countries also survive(d). So no need to worry.

As long as you have trust in your government for making the money, and the banks for multiplying it, you have nothing to worry about.

Gold wouldn't have this role if there was not substantial consumer and industrial demand for it.

Bitcoin wouldn't have any value if there wasn't demand for it.

In the short term price and value don't have to align.

Bitcoin has existed for 9 years. While you are waiting we are reinventing how money works.

The portion of gold's market cap attributable to consumer and industrial demand is miniscule compared to the portion attributable to its wealth protection function. Bitcoin is a better mousetrap for that use-case and the market is figuring that out.

The market's decision about what to use as a store of value is a market-wide Schelling point decision based not around "what asset has underlying value" as any underlying value is quickly dwarfed by the magnitude of the value that needs to be stored, but instead the Schelling point decision is based on what asset has the best properties for money. If you look at what has been money in the past, you'll see examples (like giant stones) that were clearly not based on underlying industrial demand.

https://en.wikipedia.org/wiki/Focal_point_(game_theory)

Bypassing financial regulations, extortion, llicit substance trade and many other forms of small-time illegal activities. If you strip speculative value and all the technical gloss, what's left is essentially Liberty Reserve 2.0.

https://en.m.wikipedia.org/wiki/Liberty_Reserve

P.S. Fees has actually got lower since the worst back in May, but there is no telling it won't happen again. Paying for anon hosting is not a bad idea but fewer providers are willing to provide it now - Vultr still accept bitcoin but require to have credit card on file as well due to abuse.

Volume-wise, the biggest use case is speculation and store of wealth (just like gold in the physical world). By number of transactions it is gambling (eg poker), another one you forgot to list.

I will admit that I am not very familiar with the bitcoin gambling scene. It's hard to imagine that people will go through the trouble to bet with bitcoin when most places in the world with good infrastructure to support bitcoin also tend to have accessible gambling activities using fiat.

You forgot some:

-Peer to peer remote transactions

-Embed money into a binary, a puzzle, an image, a file

-The only money no one can take away from you, even states. Protection from governments like Greece

-Inflation hedge. Protection from governments like Venezuela.

-The only money no one can take away from you, even states. Protection from governments like Greece

except hackers, if they get their hands on your wallet.

at the very least, it's better than western union

Sending money is a good use case.

* would be * a good use case if it were reliable.

I don't want to say I'll transfer $1000 to someone and by the time the transfer is complete the vale has dropped/I need to wait 5 days for confirmation/ the bitcoin exchange has collapsed.

You don't need an exchange to make a bitcoin transaction, that's the whole point. It's decentralised.

Exchanges are only for trading your fiat currency for bitcoin.

i don't think we are close to general ai, but bitcoin is a key ingredient for AI being independent. Currently, electronic banking requires a human in the loop, even for corporations.

Bitcoin is designed to be a decentralized store of value. A form of money that belongs to the people, as opposed to the banking sector.

That being said, I don’t think Bitcoin will become truly relevant (to the average saver) until either a) inflation picks up to a worrying degree, or b) negative interest start prevailing. When/if this happens, the advantages of a decentralized monetary unit will become obvious.

Wow.. I think you guys should read financialcryptography.com before commenting

Can you get an IRA portfolio based on cryptocurrency? It would be nice to be able to invest in btc with the same kind of tax benefits you get with a traditional stock based IRA.

Not yet. Winklevoss twins ETF got denied after four years.

https://www.nytimes.com/2017/03/10/business/dealbook/winkelv...

This company lets you set up a self-directed IRA and buy Bitcoin or Ethereum with your IRA https://bitcoinira.com I don't know if this is legitimate or not.

You can buy gbtc, but it's at a premium to buying bitcoin directly.

It way too volatile and uncertain. It literally depends on a decentralized network that no one can control exactly so that why it keeps getting shut down

Is it too late for the average joe Software Engineer to invest in Bitcoin?

This is exactly what keeps moving the price up.

Last one out holds the bag.

The finite bag of 21m coins? Vast majority of which are likely lost from when it was worth a few cents?

If bitcoin has utility, its price will reflect that.

It is not, but you might want to dollar cost average in.

I'd also look at quality ICOs if you can do the technical due diligence on them e.g. https://hackernoon.com/the-dawn-of-the-1b-ico-a0486f6587a2

There is an interesting discussion between Hal Finney and Satoshi in 2009 about the possible value of bitcoin. This is back when it was just a random software project, and had zero value: http://diswww.mit.edu/bloom-picayune/crypto/142207

    As an amusing thought experiment, imagine that 
    Bitcoin is successful and becomes the dominant payment
    system in use throughout the world.  Then the total
    value of the currency should be equal to the total 
    value of all the wealth in the world. Current estimates
    of total worldwide household wealth that I have found
    range from $100 trillion to $300 trillion. With
    20 million coins, that gives each coin a value of
    about $10 million.

And why, exactly, total value of currency should equal total amount of wealth? What exactly is the contradiction, arbitrage or other mechanism that sets total value of currency to total amount of wealth?

The original assumption was just world cash supply (M0), include all m3 supply and you in for a surprise.

Who creates money is the best answer to your questions.

You mean (US) M3 equals (US) wealth? Why? Can you back that claim with statistics?

It's not, actually - the total value of all physical $USD (M0) is only about $3.8T, vs. the figure of $100-300T given for total wealth (which seems low to me, BTW).

The actual truth is even weirder: if Bitcoin takes over as the world currency, its value in $USD will be infinite, but the question will be meaningless, as the dollar will be worthless. Currencies tend to be winner-take-all within a society; if one takes over, its rivals lose all value, as their only value is in being a medium of exchange and store of value.

This is perhaps a contributory factor to the Bitcoin's volatility: if you actually believe it's going to succeed, unambiguously, the rational thing to do is to move all your wealth to Bitcoin. And similarly, if you believe it's going to fail, the currency by definition is worthless.

There are 164 national currencies in the world. The USD is the defaco world currency and the USD is not worth infinite of other currencies and the rest are certainty not worthless.

I think the US government tolerates crypocurrencies because realistically they are far more damaging to countries like Venezula and China who have much more restrictive economies and in those countries the flexibility of bitcoin is a huge advantage.

How many aircraft carries does bitcoin have? 0. Which (in my opinion) happens to be the exact same chance of bitcoin usurping the USD as a global currency short of some fundamental change in world power.

The thought experiment explicitly implies BitCoin usurping the $USD as a global currency, and presumably all other ones as well. I'd agree with your assessment of which countries/currencies are realistically much more likely to suffer, but thought I'd engage with the thought experiment on its original premise.

On the aircraft carrier issue - the killer app (literally) for cryptocurrencies is autonomous weapon systems. Imagine if you could deposit $Xm Bitcoins into an address and have access to a fleet of 100,000 drones on 10,000 speedboats. At that point, we're really in uncharted territory, though.

Does anyone think the current owners of capital are going to sit by and let their powers and wealth be destroyed? If bitcoin were ever likely to become close to being the dominant payment system it will be outlawed with "extreme prejudice".

Nah someone just needs to gift Donald Trump a fat stack of it and it'll be recognized as genuine legal tender in no time.

Do the current owners of capital principally hold their money in cash? If they're holding their money in ownership of companies and things, then their wealth wouldn't be destroyed as (current) monies became displaced by bitcoin.

No they mostly own assets, but they need control over the money supply to ensure they don't lose control of the assets. How would the GFC gone if they did not have control of the money supply?

I'm not convinced. If I own a row of houses, bitcoin displacing dollars won't change that.

If you just own a row of houses you are not part of the 0.01% who are in control of the money supply.

If I own so many houses (or other such assets that aren't simply a pile of dollar bills) that I'm part of the 0.01% (since you've changed the argument from "owners of capital" to "0.01%"), the dollar being displaced by the bitcoin as currency of choice doesn't change that.

It does when the interest rate you have to pay on the mortgages you have over the properties can no longer be controlled. If you were the owner of many houses in 2007 and we used bitcoin rather than dollars you would have been in for a world of pain.

I think Bitcoin has potential but the majority of people do not want their everyday currency to change value everyday

Every currency changes its value every day. Every minute even.

Plus I don't think anybody would mind if their currency tends to increase in value.

consider some of the up and coming alt coins instead. you can triple your investment in a week. Very unlikely with bitcoin.

Or, considering that these are almost surely zero-sum pump-and-dump scams, you can also lose your entire investment.

eh I already sold enough to cover my initial investment back years ago, it's smooth sailing for me since then :]

In the words of Roger Ver - it's never too late. 5 years from now people will be kicking themselves for not getting into bitcoin when it was at $4000.

Ver is a convicted felon. He's also the guy who posted a video saying he'd looked at Mt. Gox's records and they had all the assets they said they had.

And what does his background have to do with the logical statement that it's never too late to get into Bitcoin? When Bitcoin crosses $5000 are you still going to bring up his background?

Bitcoin adjacent companies like Nvidia are riding the craze and would be less susceptible to a tulip mania style crash if that's your concern

You can't profitably mine Bitcoin with GPUs. It has been this way for 3-4 years.

scroll down and look at the pricing history of the rx 470: https://www.videocardbenchmark.net/gpu.php?gpu=Radeon+RX+470 and the 480: https://www.videocardbenchmark.net/gpu.php?gpu=Radeon+RX+480

Notice what happened during the alt-coin bubble?

Now go look at nvidia's stock price around that time. Everything went bonkers in May.

So I understand what you are saying, but there is clear historical evidence for my claims. When it comes to market manias the safest place to make money from it is adjacent to it in a way that supplies the maniacs.

The cyptocurrencies that can be mined with video cards are different from bitcoin. Ethereum is probably what you are thinking of being mined by GPUs.

obviously it's for the less valuable coins with lower difficulties.

It's not obvious if you call them bitcoin when that isn't their name. That's like calling 7-UP a coke.

ok, but 7-up adjacent companies are coke adjacent companies; canning, sugar, labeling ...

I don't know what you are saying. You can't mine bitcoin with a GPU. You can mine ethereum and probably other cryptocurrencies with GPUs. Bitcoin is a specific cryptocurrency. Nothing you are going to say is going to change that reality.

Not, but you have to be prepared for not touching your investment for 5 years because of the high volatility (which means the price could go down to $1000 for a year temporarily, than back up to $10000).

Here's a logarithmic graph of the price over the last few years, the slow price drop from $1000 to $200 was painful for most investors:

https://bitcoincharts.com/charts/bitstampUSD#tgSzm1g10zm2g25...

> which means the price could go down to $1000 for a year temporarily, than back up to $10000

I'm bullish on Bitcoin, but you should also acknowledge the price could go to down to $1000 or $100 or $0 and stay there.

It could go to $0 instantly, if ECDSA + RIPEMD160 would be cracked. I don't see any other way currently.

I sold mine a few days ago around $3100 which is slightly annoying. I did buy most of them at about $500 though. At this price there is definitely going to a be a sell off and I'll get in again then.

Why did you sell it? If you needed the cash that makes sense, but else if you've believed in it for a couple years, then why now?

I was tired and thought it had reached a maximum for a while. I was very wrong.

The same news got posted on HN 1h ago, got flagged after 36 up votes:

https://news.ycombinator.com/item?id=15001403

Bitcoin Cash and Bitcoin combined at almost $4500 now.

https://www.coingecko.com/en/price_charts/bitcoin-cash/usd https://www.coingecko.com/en/price_charts/bitcoin/usd

Split ended up bringing the potential forward for both camps and able to move on

Reply on news.ycombinator.com