Coinbase Billionaire Brian Armstrong’s Plan to Make Crypto Safe for All
forbes.com
forbes.com
Confusion because I don't understand how all of this has such an immense amount of time and capital invested in it when its actual use case for anything is extremely vague (mostly about future potential) and some that have moved away from proof of work (Stellar) seem a lot less safe?
Admiration because all of the different approaches, goals, and designs are really technically interesting (Dai using market incentives to stay pegged to one dollar, Tezos proof of stake and ability to get consensus on its own updates/formal verification, Zcash using zero knowledge proofs to keep transaction history optionally private, etc.)
I can't help shake that while the ability to hold decentralized consensus is neat, most of the current value seems to come entirely from speculation on future token price from people on reddit that have no idea what they're buying. Why do these things have any real value?
I've tried to follow the reasoning of people like Balaji S. Srinivasan from what I can find, but I have a hard time modeling a future where the current value of these things makes sense.
The value of Coinbase in all this makes sense though, if you build reliable infrastructure in a market you should make money - it doesn't matter if the underlying assets are worth anything or not.
But, if you have 1 trillion USD of value (insert the actual value that is meaningful to you) that you want to transfer around the world, you certainly want to do it in the most secure way possible. Especially without having to get permission from your local bureaucrat first. Bitcoin certainly makes that possible. The problem being that buying up 1 trillion USD worth of bitcoin is going to obviously move the market and anyone holding enough to do that OTC, makes it pretty centralized.
I do feel like there is a middle ground here and that is to look at it as more of a store of value. Just buy and hold it in the same way that people hold onto gold. If you look at the 100yr charts for gold, they are all over the place. 2008 was one of the largest dips that set things back at least 30 years! Now things have bounced back... but it is all on speculation and really has nothing to do with some sort of 'intrinsic value' of gold.
Further, btc works precisely as well as a payment platform whether the price is $1 or $1,000,000. This makes the discussion of the price of btc suspicious to me.
Sounds good in theory until one is faced with a fraudulent vendor, a suddenly empty wallet or a transfer error due to some "fat fingers" mistake. Then people somehow get nostalgic for "how much of a shitshow the payments industry is" and how quickly it acts on chargebacks, scams or unauthorized spending.
This plus bitcoin’s inability to handle transactions in a timely way makes it kind of useless for this.
From the other commenter I think bitcoin as a store of value could be possible, but it’d have to stabilize in the end which remains to be seen. I’m also not sure scarcity itself guarantees value, but I probably just don’t know enough about this.
The inability to compute exactly how many there are, nor their rate of creation. Their limited use beyond a specified geographic boundary.
The confident speculation based on ever increasing underlying leveraged weakness (showing no sign of slowing) is worrisome.
Read the Bitcoin Standard book, or Plan B's article if you honestly want to understand why Bitcoin is so crucial in the current financial climate.
Plan B: https://medium.com/@100trillionUSD/modeling-bitcoins-value-w...
Bitcoin Standard: https://www.amazon.com/Bitcoin-Standard-Decentralized-Altern...
Edit: 'not taken into account' is probably the wrong way to say it, rather it is assumed.
I think it's amazing how well a simple model with just 2 variables can explain the difference between Bitcoin price movements in the first few years and later years.
Time based models are so much worse that it's crazy. I don't know any model that comes even close to it.
Anyways stock-to-flow predicts that for a halving of money issuance the demand for the asset as expressed in market cap will be 8x.
If course market cap is a strange and not perfect metric for demand, but that's still the best we have for comparing assets and asset classes.
Should just be renamed Big-Brotherbase, or Banned-for-Life-and-Won't-Tell-You-Whybase. Coinbase is famous for suddenly disabling accounts and refusing to give an explanation. At least a traditional bank will normally explain the circumstances.
Got one of their arbitrary sucks-for-you letters last year. No way would I ever recommend them to anyone.
In my case I'm a mining developer, so I have a huge digital currency profile. Coinbase is horrifically opaque and impossible to deal with if they flag you unlike most other organizations.
E: I'll just lump some more examples of their corporate ineptitude.
1. Recently I asked them for a dump of trades and fees executed on their exchange for audit and record keeping purposes. All they had were records of deposits and withdrawls but none of the actual trades. So no cost-basis data and now a huge accounting headache.
2. When my personal account got locked, we separately had an application out for an institutional account. 4 months go by and suddenly I get emails saying "we're ready to proceed with your institutional account". Excuse me? Told them to fix my personal account first. Never heard back.
Sometimes it's difficult to ascertain whether something in a magazine is a legitimate article or paid advertising. Or maybe it's self-serving enterprise by both sides. I scratch your back, you scratch mine.
I always wonder, who decided on this article. Did coinbase call forbes to "commission" an article? Did the writer/forbes call coinbase? Did forbes have an online poll asking their readers for suggestions on an article topic?
Well it's forbes, and based on the url you can tell it's written by one of their "contributors" (aka. glorified blogger).
People can also pass stories to reporters for big news or pitch their own articles, although in this case this looks to be the former.
Does anyone else remember seeing a thread about Coinbase trying something ambitious/sanctimonious and then comments calling it fluff or handwaving it away, just like this, a year or more ago?
Fortunately there are tons of digital currency exchanges. Kraken, Gemini, Bittrex are all very viable alternatives that also comply with various regulations in the US.
- Coinbase not having records of your trades (although it's operating from a highly regulated jurisdiction)
- Coinbase not communicating why/how accounts are locked.
> Having people get locked out of their crypto is no good.
Funny thing is that crypto (Bitcoin) was made so that people could hold their own monies instead of relying on a third-party.
This isn't accurate for active accounts, at least. I use the REST API to pull down my trading history, and it has all of it going back to 2013.
Surely you can see the irony in that?
Here in India, we have a system called UPI. Connect it to your bank account once and you get a username like 'YourName@OkAxis'. Anyone can send money to this username and it goes straight to your bank account. You can pay establishments - online as well as offline - by simply verifying a one time password on your mobile. It's so seamless and cheap (essentially free) that I can't ever imagine needing a digital currency.
A bulk of transactions still happen via cash but digital payments, especially UPI, are seeing increasingly wider adoption. There has been a lot of innovation in this space just to make customer-merchant transactions easier.
For example, this product from PayTM basically acts as a confirmation box for UPI transactions.
https://business.paytm.com/blog/introducing-paytm-sound-box-...
Something like this reduces the trust deficit in rural areas about digital banking products.
It's going to take a long while, but technologically, it's a solved problem. I can't see any utility that crypto brings to the table except for decentralization which most consumers don't care about anyway.
Bitcoin and Ether are autonomous.
Monero and ZCash are anonymous.
Not sure what you mean by resilience.
>Surely there's more to it than a cash grab that takes a massive amount of energy
Proof of work is not inherit to cryptocurrencies.
Not when you're using Coinbase.
Monero [is] anonymous.
Sure.
ZCash [is] anonymous.
lol
Proof of work is not inherit to cryptocurrencies.
I didn't claim it was. You completely misinterpreted my comment.
It is a bank, that instead of storing cash, stores keys. It is centralized. It complies with regulators. It does allow you to withdraw your keys into your own wallet, but a bank also allows you to withdraw your cash to your physical wallet. It walks like a bank, and it quacks like a bank. It is a bank.
One of the most painful startup analogies I've heard.
“Juicero: it’s like if Google made Gmail for juice”
The whole of society suffers from the accumulation of wealth to these few people.
On that basis, I don’t give a fuck what this person says because they won’t overcome the exploitation that got them there. And he does not command respect by having so much money.
This is the aristocracy by a different measure. Back then they used agricultural output. Now it is measured in assets.
Do the corporations that evil billionaires own not pay their employees?
You realize that this wealth is just a result of a couple percent of markup per transaction on a massive scale, right?
Yeah, Armstrong may be a scummy person, and his exchanges are trash, but he made his billions by offering a service that no one else did. There was no other way that I'm aware of to easily buy BTC or ETC with cash before coinbase popped up.
It's possible to make a billion honestly.
I have used Coinbase for lack of alternatives. It's awful. Every time I sign in (a few times a year) there's some new problem with my account. Either they need more ID verification (done it 10x) or they decided my purchases are going to be delayed 3 days or blah blah blah. I just got an email from them today saying my account is suspended if I don't take some action.
This is not the decentralized future crypto people want. It's a half-assed bank that doesn't need its customers.
You can buy it here: https://www.axcrypt.net/ and http://www.cryptoexpert.com/.
However there's really no need to buy it anymore, as there are very good open-source implementations, like https://gnupg.org/ and https://www.veracrypt.fr/.