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Comment by adamqureshi | Hacker News Reader

BTC are like casino chips. When you goto Vegas and at the Bellagio you give them $100 and you get back $100 worth of Bellagio chips, those chips only have value INSIDE the Bellagio and if you take those chips outside to a 7-eleven and try to pay for a slurpie and a taquito the 7-eleven guy will tell you to get lost we do not accept Bellagio casino chips. 2-cents. BTC value is an illusion they only hold value inside the BTC network and they are worth what the next sucker will pay for it. Yes you can make money from anyone inside the network who's willing to pay more than you did. Maybe i don't know what im talking about but im not the only one. 2-cents.

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This is great analogy, except the "inside" of bitcoin is constantly growing bigger and assimilating more real world realms. It now includes the entire country of El Salvador.

The real magic happens when a nation state starts selling it's exports priced in bitcoin instead of dollars. In fact, Putin was recently asked about exactly this for Russia. He dismissed it as "too early to talk about the trade of energy resources in crypto", but my takeaway from that statement, is that the door is absolutely open. [0]

Then again, wanting to sell oil for something other than dollars is probably why the US killed both Saddam Hussein (wanted Euros) and Muammar Gaddafi (wanted gold backed African currency), so we'll see if the US still has enough proof of violence (PoV) to maintain security of the dollar as the global reserve currency.

I don't know what I'm talking about either, so this is just my 2 sats.

[0] - https://www.cnbc.com/2021/10/14/russias-putin-says-crypto-ha...

> probably why the US killed both Saddam Hussein (wanted Euros) and Muammar Gaddafi (wanted gold backed African currency)...

As far as I understand the Libya military intervention was a NATO mission and the French and British were early proponents of intervention before the US.

https://en.wikipedia.org/wiki/2011_military_intervention_in_...

We came, we saw, he died

That analogy fails badly. It could be said of any fiat currency. Take some Japanese Yen to different country where it is not a readily accepted legal tender and give it in a supermarket. I’m sure the response would be the same as what you quoted.

The value and the next sucker part also fails for the same reason. You can exchange or even use to pay, say, USD in many countries in shops and street side currency converters of dubious legal standing. They would trade it with the “next sucker” because they’re part of a network that values USD.

actually you used to be able to use poker chips like cash as this article describes and explains why it is no longer allowed.

If you try to bring in chips received from other people the casino can choose to not pay you out as the article describes.

https://lasvegassun.com/news/2007/mar/09/chips-no-longer-goo...

<<The harsh lesson he learned is that this isn't old Vegas, where casino chips were the coin of the realm, used to settle debts between friends, buy groceries and pay for haircuts.

That culture started to change 20 years ago when Nevada defined tokens as the property of individual casinos and prohibited their use "for any monetary purpose" outside the casino. They were simply intended as stand-ins for cash, loaned to players for the sole purpose of gambling.

The regulation was adopted to bring state law in line with federal rules prohibiting the creation of new currencies and with existing casino accounting procedures. The rule also has favorable tax implications for casinos, which aren't taxed on unreturned chips.>>

I thought for sure the fed gov would kill bitcoin by banning its use as a "currency" which is why I didnt get in at 25 cents.

They kind of did. It's defined as property, so every time you spend it, you trigger a taxable event and need to calculate capital gains or losses, which of course can get absurdly complicated if you use it for everyday purchases.

That's why most people are using it as a kind of savings account, where they rarely liquidate larger amounts into the local fiat when they need it.

Of course, now that's not necessary in El Salvador since it's now a legal tender alongside USD. That's the first country where it's use as a currency can really be tested en masse. Still too early to tell how that's going to work out.

As if any other currency is different. Try to take your cash and pay with it outside your country, people will look just as funny at you. Might be a bit different with currencies like USD, but in many countries it's actually illegal to accept payment in foreign currency.

Yes; BTC is non-fungible with the majority of your potential trading partners. However, depending on your locality, the same can be said about USD, Renminbi, Euro, et al. You are biased in that you are discounting the shifting Overton Window of what your trading partners will accept in the future.

> BTC are like casino chips. When you goto Vegas and at the Bellagio you give them $100 and you get back $100 worth of Bellagio chips (...)

This comparison is not valid at all because, unlike any crypto like BTC, the value of Bellagio chips is specified by a central authority (Bellagio itself) which guarantees the exchange between chips and cash with a fixed and very stable exchange rate.

With crypto like BTC, not only their value fluctuates wildly and thus fail as a store of value but also the only option you have to exchange them for fiat currency is to sell them to other customers in an open market.

The best comparison with BTC is indeed tulips during the Dutch tulip craze: they have no intrinsic market value, their market was highly speculative, and demand was driven by mass hysteria.

>their value fluctuates wildly and thus fail as a store of value...

Sounds like TSLA and many other publicly traded companies are bad stores of value according to that argument. Many people with stock exposure in their retirement portfolio would disagree.

> Sounds like TSLA and many other publicly traded companies are bad stores of value according to that argument.

If you intend to have a serious and honest discussion on crypto then the very least you should do is go acknowledge the frequent crashes that result in halving their market value. For instance, BTC still hasn't recovered from the latest crash a few months ago, when it tanked to half it's value almost overnight.

Otherwise, these nin-sequiturs don't lead anywhere.

If you want serious discussion, you should first realize, that there's no "gold standard" of value and it is all relative. So there's not much difference in saying that BTC crashed 50% from its peak, from saying every other currency crashed 50% when BTC was at its peak.

"For instance, BTC still hasn't recovered from the latest crash a few months ago" it made new ATHs this week. I mean what do you people want, that it always stays at ATH every single ticking second? Zoom the f out ffs.

>For instance, BTC still hasn't recovered from the latest crash a few months ago...

Bad take, you obviously haven't seen the price chart in a while. BTC had new all time highs just a few days ago.

Tesla has halved and recovered multiple times as well. Feel free to put forth a better argument, this one is weak.

Stocks aren't supposed to be a store of value

Thanks to mismanagement of the US economy, debasement of the dollar, and 0% interest rates, stocks are now used as stores of value because it's impossible to beat the hurdle rate and stay liquid with any other asset.

Bitcoin fixes this.

Bellagio has low transaction costs. The relatively small amount of money I have in Bitcoin would cost me more than its value in transaction costs to convert to dollars.

This may not be true, if you are comfortable sharing the amount, I may be able to help you.

Fiat has the same issue depending on the amount being exchanged. Attempting to convert a US penny to Euros can leave you in the same situation.

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