But didn't Bitcoin want to be a currency and not stocks?
Bad transaction rate? It’s not a currency, it’s a store of value! Why does it have value? Because it’s more stable than fiat! What about the volatility? Ignore daily volatility, it’s going to the moon! But why is it worth more? Because you can buy stuff with it, like a currency!
Round and round it goes.
The argument for bitcoins price from even bitcoins advocates usually seems to ultimately boil down to “It’s valuable because the price of it is going up”. If you ask why the price is what it is, the answer is basically that it’s high because it’s going to be even higher in the future!
It might be even higher in the future, but this has no economic fundamentals behind it.
With all the free money that is currently floating around bitcoin is again slowly moving towards its saturation point where the pool of potential buyers is exhausted and the prices have become unsustainably high. The psychology of the market will reverse causing a "run on the bank" (which apparently is a good thing by some gold standard advocates in this thread) and it will again sink like a stone without anything to stop its fall. A good thing to remember is that bitcoin has yet to face a real depression akin to dotcom bubble. If and when it falls to levels so unfathomably low that it would incur losses so heavy that would shake the whole industry to its core, then it might forever lose its status as a digital store of value which price increases forever to infinity.
One thing I must say and what most people forget is that bitcoin is also a form of gambling and which actually explains some of its success. It has the characteristics of a sport which is fun to discuss, interesting to research and easy to bet on with a lot of volatility that can be as addicting as gambling in a casino (which again shares a lot of similarities to traditional stock investing or the collection of art pieces). Can we explain why gambling or sports are so addicting or necessary to the whole society? We humans are emotional creatures that believe in the most silliest of things that defy normal logic yet which we can not unravel like the people living in a cave in Plato's allegory. What in the end is real? God is dead said Nietzsche and therefore we are constantly seeking something "valuable" to cling onto.
Contrary to what many people who only recently discovered Bitcoin probably believe, it was not created in a vacuum as some Ponzi scheme. Instead it was a concept that had been iterated on for decades until Satoshi discovered the right combination of cryptographic technologies and economic incentives to make a so-far-unstoppable decentralized digital currency.
> Instead it was a concept that had been iterated on for decades until Satoshi discovered the right combination of cryptographic technologies and economic incentives to make a so-far-unstoppable decentralized digital currency.
You know how that sounds right? Like religion, not clear-headed thinking.
My opinion is neither of those is a religion. The development of Bitcoin in particular sounds more like following the scientific method to me, but you're entitled to your own interpretation.
Not digital gold, but pharmaceutical grade gold as Saylor put it in a recent Odd Lots pod, and it's hard to argue that...also quoted from the same pod..[not a perfect transcript]
"...so that took us to cryptos and we looked at 6500 cryptos and we found that BTC is the dominant network. its 25x bigger than the next closest thing that looks like it, and has more than $200bil monetary energy in it. it is basically Facebook or Google for money.
and this is the nuance that most people haven't realized yet..what you have is a dominant digital network that has been engineered to host a safe haven treasury reserve asset superior to gold in all respects.
it's pharmaceutical grade gold [love this line]. if God [blurb] gold as a treasury reserve asset to hold for 100 years, he would create 21mil gold coins, he'd make it impossible to make any more, he would make it possible to audit it from anywhere on earth from any node every 10 minutes, make it unhackable and make it an open architecture where you could build it into an iphone or into Square or paypal or any other exchange without permission, and he would distribute it everywhere on earth with these crypto SHA256 miners so hat no company controls it, no CEO controls it, no country controls it, and no regulators control it..."[0]
[0] https://play.acast.com/s/oddlots/6b8b72d0-455c-11eb-b9ed-377...
I feel like this whole pitch makes sense until you get to that part.
Do you care who owns your real estate before you buy it? Or who mines your gold before you wear it? Probably not.
Yes I suppose there is some political aspect to that side of it, but the crypto itself...it's about as apolitical as it gets.
This hinges entirely on control of mining, in fact you could argue who mines it is one of the most important questions to ask.
Cryptocoins are subject to majority attacks and rules that can change at any time based on the miners preference. Who mines it is very important.
You would also care about who owned some real estate before you buy it if it was some company known for dumping toxic wast into land and then selling it. Those things are not as apolitical as they look like in an organized society.
If I decided that I could profitably use toxic-waste laden land, then yes of course I would still buy it and, yes of course, still not care because that's what due diligence is about.
Your liquor store sells alcohol that kills more people under the age of 30 than any other way...why aren't you standing in front of it demanding it shut down?
They get to censor transactions, they get to decide what makes it and what doesn't, they get to double-spend if they want to. That's how authoritarian government works.
This is a natural consequence of the proof-of-waste system employed. The hashpower goes to the place where waste would be the cheapest, and that's China.
[1] https://news.bitcoin.com/65-of-global-bitcoin-hashrate-conce...
Let's say Dalai Lama decided to follow MicroStrategy with a 400M purchase.
His BTC could be near unusable if China were to control some amount over 50% of mining capability.
How could that happen? The blocks you mine you simply not process any of "undesirable transactions".
If any of the lesser miners find a block and try to add a transaction to the ledger you perform a double spend attack.
The Bitcoin Cash fork and Litecoin made scaling choices that make it better for payments.
But they made it deflationary and a good currency needs to be inflationary otherwise you just hold onto it instead of spending it. Which had made it more like a digital gold.
It has totally failed as a system for payments for this and other reasons. It is also too slow and too expensive per transaction.
The Bitcoin project lives on and most real users and developers moved to other projects like Ethereum, Bitcoin Cash and Monero the same time Blockstream wrestled control of the Bitcoin Core GitHub repo.