The Postmodern Ponzi
stephendiehl.com
stephendiehl.com
I personally would change my mind about this if you could show that this technology offers advantages over traditional products, and I'm willing to bet that even the author would reconsider his position. On the key metrics, transaction cost and speed, current cryptocurrencies lag behind. If it were capable of providing these it would even become a stable store of value since it could provide the framework for all banking around the world whose provisioning price could remain approximately constant.
Distributed consensus means you can't have instant confirmations.
POW means you can't bring cost per transaction down (in energy or in money).
etc.
Mechanics is everywhere the same, as large amount of money flows into limited something the price increases an people who time their entry end exit right gain and others loose.
Real estate, the stock market etc. are distinct: economic value is at least in theory based on underlying economic activity.
You can not mine bitcoin without gold...
I think bit slower than bitcoin just because bitcoin is so easily splittable, transfersble and easy to hold safely.
This is additionally interesting because of the critiques that Keynes leveled at the Gold standard when it was being widely used in the 19th and early 20th century, which have turned out to hold the test of time.
I stopped reading here. The writer is obviously a luddite who doesn’t even want to understand the topic, he just wants to smash all the new machines because he is afraid.
There are so many disadvantages that flow from the choices made in Bitcoin as a currency, and many of those choices are inherent to the things people claim are good about it. Try to remove them and you are completely reworking it. Just as one example you can’t have instant confirmations in a fully distributed system which shares a ledger because there are n sources of truth, not one, and eventual consistency is a terrible idea for a currency.
In any financial transaction I want to verify the identity of the counterparty, I want to manage risk by having a known third party manage the transaction and disputes, I want instant confirmation and low stable fees and prices, and I certainly don’t want to have any uncertainty (even for minutes) about whether a transaction worked.
I too would love a truly supranational currency, but would want a very conservative one with light inflation built in (i.e loses value v. slowly) controlled by a transparent governing board with a financial stake in stability and low fees, decentralised records on the level of institutions, not the entire ledger, and not one which enriches early adopters.
For this reason alone I think the built in advantages for early adopters in bitcoin was a terrible mistake - it attracts the wrong kind of people and encourages shilling and irrational exuberance when the value goes up quickly, which is deadly to a real currency.
A luddite? What a ridiculous allegation. Sounds like you stopped reading because your cognitive bias wouldn't let you continue, frankly.
Wait until someone tells him about Treasury bonds.
They don't have to formally default if they inflate the dollar enough that a current dollar is worth only 10% (or whatever) of what one was worth at the time the bond was issued.
And it's starting to look like that's exactly the strategy that's in play.
Were you thinking of the US dollar?
> The world is an increasingly strange place and one of my favourite quotes about the times we’re living through is that we’re all all in a superposition of being both overwhelmed and underwhelmed.
This does seem spot on.
It almost seems like you can stamp "postmodern" in front of any modern concept, bring it to the context of some pseudo–Marxist frame of thinking, and there you go, seemingly you've done analysis.
My one problem with your thesis is that Bitcoin is no longer a currency but a speculative asset. It has not yet proven a stable store of value, or a useful currency, quite the opposite, and if nobody uses it to transact, what value does it have?
PS It’s fiat, not feat.
Satoshi still has around a million Btc...
I call this printing money
"However today cryptocurrency is nothing more than an ecosystem of thinly veiled gambling products that is preying on the vulnerable, perpetuating economic inequality and deepening the existing problems in our society. It is time for us in the software engineering profession to decide how history will tell the story of our participation in this madness. If we choose to make short-term decisions based on indifference and greed then history will not judge us kindly."
The author probably thinks the only speculation happening is in crypto... What do you think the whole of the stock market is doing? What about software developers working on wall street should they resign as well...?
Because if they are not worth anything then stock market is ONLY about timing your entry and exit correctly by sheer luck. Same as bitcoin.
Its besides the point, but, infact the whole of the USD and the American economy is one massive ponzi scheme ripe a massive crash any decade... Printing and exporting USDs with nothing to back it except the military is not going to last forever..
Speculation vs Investment can only be determined on a trade to trade basis. It is just too simplistic and frankly impossible to judge the motivations of markets and claim to know intentions of all the traders of a given market.. so I'm not buying, markets are not speculation only these crypto guys are..
If you think that wall street investors are the same as gamblers and the entire American economy is a Ponzi scheme then you have lost touch with reality. You have quite literally got to the point where your definitions have expanded to the point of being meaningless.
I'd flag this as inflammatory, but I'm too much of a right-wing populist who cares about free speech.
Natter on with the folly. Most right-wingers I know IRL would touch BitCoin with anything they don't care to lose.
Let the tulip mania roll on, say I.