If it goes up in value again, 2x or 10x its current value, will people who said it was a grift admit it was more than that?
I would bet money (fiat or digital) that, in either case, most people on either side will just say "I haven't been proven right yet", because it's just camps yelling at each other at this point.
I've called it a grift since 2017 so yeah. Being a grift has nothing to do with its price and everything to do with its fundamental structure.
- As a currency, it's garbage. Currencies are inflationary to incentivize spending. A deflationary currency incentives hoarding, and harms the economy by dropping velocity. All the worst periods in history have been deflationary, not inflationary. Currencies benefit from being able to respond to changes in population, to shocks, to changing demographics. And they shouldn't cost a fully-realized (inc. block reward) $200+ to transact.
- As a 'hedge against inflation,' it's garbage. In the most inflationary period in decades, it went from 69K to 28K. That's a drop of 60% in nominal terms. While the dollar dropped 9%. That means it dropped 69% in real dollar terms in a few months. RIP.
- As a 'store of value,' it's garbage. A store of value must be predictable. You should have a reasonable expectation that you can extract the same amount of value from it in the future. See above.
- It's an environmental catastrophe, wasting as much power as an entire nation (and yielding kilotons of e-waste per year) to achieve 6tps. Millions of times less efficient than Visa, or FedNow or RTP.
It has sufficient throughput at the L1 level to service a large flea market or a mid-sized Costco, not the world economy. Lightning is a nothing burger. It would take 75 years, 2/3 of a trillion dollars in fees, and the entire rest of the block reward to open a channel for everyone on earth. And LN has quadratic routing complexity meaning even if you did, it wouldn't be functional in the first place.
Even your example of smuggling money across the border doesn't make sense - you need to buy Bitcoin at one exchange in one country, then sell it at another exchange in another country in order to spend the value. That takes days, costs percentage points, exposes you to huge counter party risk and massive forex swings ... and KYC. And being a public ledger, both governments can fire up chainalysis and see exactly who moved it where. So even if they don't ask you questions as you move across the border, they'll follow up. Just give it time.
In exactly what narrative does it come across as 'fundamentally sound'?
Really…
Do people hoard value shares which have predictable returns that beat inflation?
Is most gold or property hoarded, or is it traded? (Either is expected to rise in “value” over time, expected that is by the average person).
I suspect most people try to get the best returns. Hoarding might occur in a depression, but otherwise the concept is questionable?
Of course, but those aren't currencies they're equities. That's what they're there for.
> Is most gold or property hoarded, or is it traded? (Either is expected to rise in “value” over time, expected that is by the average person).
Gold is shiny pebbles.
It's fundamentally not worth much more than its industrial value (a tiny fraction of it's market value) and I wouldn't recommend anyone hold that either. It's not productive. It doesn't do anything but sit there, shiny, until consumed for industrial purposes.
> Hoarding might occur in a depression, but otherwise the concept is questionable?
Why would you spend something today if it's going to buy you more tomorrow? You wouldn't, to the extent possible. Thats why we separate short-term intentionally lossy store of value and medium of exchange (currency) and long-term store of value (equity, real estate, etc). We don't combine them due to their antithetical goals. Trying to do so is regressive.
Really? Doesn't seem like getting off the gold standard was so miraculous in preventing recessions. Spending is great for consumerist societies, but people who are allowed to save are allowed to make far better economic votes on what is valuable past short term pleasure. Inflation doesn't encourage spending, it kills saving and makes storing wealth something only the sophisticated and wealthy can achieve.
> As a 'hedge against inflation,' it's garbage. In the most inflationary period in decades, it went from 69K to 28K. That's a drop of 60% in nominal terms. While the dollar dropped 9%. That means it dropped 69% in real dollar terms in a few months. RIP.
Pathetic cherry picking. How about I do the same thing and I start in 2013 and end anytime in the past 8 years? Price discovery is an obvious reason you as a laymen should be aware of. On chain security scaling with price is one you could be forgiven for being ignorant of. Price and security do not greatly separate and Bitcoin actually needs time for adoption for fundamental reasons (not just waiting for people to understand it).
> - As a 'store of value,' it's garbage. A store of value must be predictable. You should have a reasonable expectation that you can extract the same amount of value from it in the future. See above.
Redundant and addressed.
> It's an environmental catastrophe, wasting as much power as an entire nation (and yielding kilotons of e-waste per year) to achieve 6tps. Millions of times less efficient than Visa, or FedNow or RTP
Bitcoin is not comparable to Visa. Bitcoin is final settlement. Huge banks and financial institutions only do final settlement once a week for a reason - its slow and expensive. Bitcoin is actually faster cheaper and easier than a wire transfer and it uses far, far less energy to do so securely.
> Lightning
Lightning isn't the only layer-2, and it isn't killed by routing complexity, it simply requires more centralized routing hubs, users don't just connect to all their friends directly. This is fine for payments small enough to justify it.
Other layer 2 solutions are custodial and semi-custodial, which, just like financial systems now, settle large amounts of transactions at one time. Even a fully custodied Bitcoin bank (with insurance) fulfills the promise of secure and sound money. It also makes that bank highly auditable and accountable.
Fundamentally sound means what it says. It means the most basic function is the best in its class, and that once the market realizes it the world will build around it.
I'd look back at the graphs. The wild inflationary and deflationary swings were dramatically worse on the gold standard. Because inflation doesn't depend on supply of currency but instead it is calculated from the price of goods.
> Inflation doesn't encourage spending, it kills saving and makes storing wealth something only the sophisticated and wealthy can achieve.
Same thing bud. And no, thanks for roboadvisors, anyone can save any spare capital via investments. Or series I bonds.
> Pathetic cherry picking. How about I do the same thing and I start in 2013 and end anytime in the past 8 years?
Pathetic cherry picking. How about you do it based on the percentage of people underwater. 40% of all bitcoin investors are now underwater. Unless you have a time machine, my number is far more relevant than yours. The entire country of El Salvador is down 40% from their investments.
How many people are underwater on the Series I bonds - an actual hedge against inflation? Nobody.
> Lightning isn't the only layer-2, and it isn't killed by routing complexity, it simply requires more centralized routing hubs, users don't just connect to all their friends directly. This is fine for payments small enough to justify it.
So you solve scaling with centralization, fundamentally invalidating the core value proposition of Bitcoin as per the whitepaper. I can do that too, with my dollars.
> Fundamentally sound means what it says. It means the most basic function is the best in its class, and that once the market realizes it the world will build around it.
Cool, but their assertion was garbage, and Bitcoin is fundamentally worse than pretty much everything it competes against, in every measurable way.
Not risk free. Plenty of people making conventional investments lost their savings and retirement during 2008. It's all dependent on the Fed and their discretion. Real stores of value are not.
> Pathetic cherry picking. How about you do it based on the percentage of people underwater. 40% of all bitcoin investors are now underwater. Unless you have a time machine, my number is far more relevant than yours. The entire country of El Salvador is down 40% from their investments. How many people are underwater on the Series I bonds - an actual hedge against inflation? Nobody.
Measured in dollar value? Of course people aren't underwater on their bonds against the dollar nominally - do you know what inflation means?
The rest of your garbage can be refuted by reminding you that Bitcoin is in price discovery mode. No shit an asset with a tenth the market cap of gold, that's only been around ten and a half years, that hasn't reached adoption, and whose security scales slowly with market cap is more volatile. The majority of investors throughout Bitcoin's history have enjoyed that volatility as the majority are in profit. But feel free to cherry pick the short term losers who are holding their coins at record highs.
I want to add one…
- there are at least 12 people that could absolutely destroy BTC in a variety of ways. Elon, some developers, some mining coop, whatever whoever, it’s not impossible. For example, what do you think would happen if the original Satoahi coins started to get used? Look how many / how much is there, it would be pandemonium. It’s a weak system that people want to trust, but there are no guns backing it up.
The value proposition of decentralized cryptocurrency remains the same whether the value is $62k or $0.62.