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Comment by smithcoin | Hacker News Reader

Why is this news?

Sorry, I must have missed all of the following posts:

- AMZN under $100 (Down 48% YOY) - GOOG under $100 (Down 42% YOY) - AMD under $60 (Down 59% YOY) - META at $101 (Down 77% YOY)

and the list goes on.

What is it about bitcoin that brings people into these threads to say "good riddance! I hope it dies because all of it's negative externalities."?

To the oblivious observer it would appear cryptocurrency lives rent free in many heads in this space. If you don't care for it why pay attention to it?

I am not a fan of BlackRock. The last thing I could imagine spending my time doing would be checking BLK on the NYSE to gleefully dance on its grave when it misses its earnings, and then hopping into my echo chamber to share the news with anonymous strangers.

View on HN

Unlike the things you pointed out, Bitcoin will never give dividends or have any assets sold at an auction. Instead it's a pyramid scheme, easily replaceable by any other shitcoin out there, and the value of it should be close to $1 or less.

How is it a pyramid scheme?

If you're getting technical, it's not a pyramid scheme, but a greater fool scam

https://en.wikipedia.org/wiki/Greater_fool_theory

I'm a big fan of crypto but at least the idea of passing the hot potato til it crumbles in to nothing is a reasonable worry. Every stonk has that same exact issue.

Well, no, some stocks actually have value, because there's a money-making company behind the stock. (Or are you using "stonk" to refer to a stock that has a money-losing company behind it?)

I read it as stonk to mean stock that would be a bad decision to put money in at any time (not just because it is overvalued at this time). Like GameStop.

A lot of cryptocurrencies are part of projects that I believe in. I see the code, see commits, discussions, details of the project being used in the wild. I don't blame the people behind the project for ridiculous fluctuations in their coin's price or blind hysteria in the space.

Bitcoin's project is that it's a collectible with limited supply.

Strangely enough RAI doesn't need to be excessively volatile. It just happens to be the least volatile cryptocurrency in existence.

I wonder why that is...

Thing is, the market doesn't care whether or not you believe in the underlying asset. The difference is that when you buy shares you're buying shares in a company that actually produces something, and those shares usually pay dividends.

Buying crypto because you believe in a given project is the same as buying a beanie baby because you happen to like the particular appearance of said beanie baby.

Or as I like to say, Bitcoin is almost a perfect measurement of excess capital in the market driving up asset prices, or "excess speculation"

That's a good take. Bitcoin: a store of (excess) value. Just like beanie babies.

Art is another example. Art is just old school NFTs. Sure you could get the utility of the image for free, but the real value is in the artificial scarcity.

Art doesn't have "artificial" scarcity.

> The model employed by artists in the West, in collusion with collectors, was to create an artificial scarcity of their own products on the market. Thus they introduced editions that gained in importance with the appearance of video art, and the same model is being attempted in the realm of digital art. Having made an arrangement with agents and galleries, artists would limit the number of copies of their works (for example, by setting the limit at 10 original copies), and sometimes they would even establish a hierarchy among the limited number of copies. A certain number of copies would be signed by the artist, and they would command a higher price, usually being fewer in number than the unsigned ones. During the Golden Age of video art, that is, in the 1980s, there was almost a consensus in the mainstream art circles to the effect that the existence of an illegal copy was tantamount to a criminal offence, even though it was easier than ever to copy a video cassette. An artificial scarcity was sometimes created by limiting the number of screenings, so that a given video work was limited to, for example, 10 screenings in the whole world during a calendar year.

https://monoskop.org/images/c/cd/Lukic_Kristian_2013_Artific...

Thanks for finding the exception you need to prove your point, that must've taken a while. The argument that famous artists made a limited amount of art because there's only so much they could make in a lifetime is moot because of this one quintessential example of 1980's "video art" (those really go off the shelves at Sotheby's).

I mean it doesn't really take much time at all to find counter examples, does it? There's even a detailed page at Wikipedia with concrete examples, if you haven't ever heard of the concept of a limited or special edition: https://en.wikipedia.org/wiki/Special_edition

The very first paragraph of the page is helpful:

> The terms special edition, limited edition, and variants such as deluxe edition, or collector's edition, are used as a marketing incentive for various kinds of products, originally published products related to the arts, such as books, prints, recorded music and films, and videogames, but now including clothing, cars, fine wine, and whisky, among other products. A limited edition is restricted in the number of copies produced, although in fact the number may be very low or very high. Suzuki (2008) defines limited edition products as those “sold in a state that makes them difficult to obtain because of companies limiting their availability to a certain period, quantity, region, or channel"

The real value of (some) art is in being able to artificially inflate the book value through sham transactions, then donate it to a charity for an income tax deduction worth more than the original acquisition price.

> Art is just old school NFTs.

I am an art collector. None of it is rare or wildly expensive. Nor do I expect to resell any of it.

It might shock you to discover that I collect that art simply because I enjoyed looking at it and having it. I go to art galleries to see art that I do not own, not because of its financial value, but because I enjoyed looking at it.

The idea that art is exactly an precisely an investment vehicle is simply false to the fact. And honestly, I find it horrifying and empty.

Your smug statement presumes no one trades NFTs for the same reasons you do. You managed to make an economic observation into some personal emotional feely victim statement.

Personally I love looking at a nice shiny piece of gold and artfully stacked pile of $20s.

And unlike those things, Bitcoin cannot be confiscated by the government, specially third world tyrannical governments that seem to always be trying their hardest to impoverish and screw those under their administration.

> it's a pyramid scheme

That's your opinion.

> easily replaced by any other shitcoin

It's not.

It can't? Strange how the government ended up controlling the Silk Road's stash

Bitcoin is constantly confiscated by the US government. Can you clarify what you mean?

I guess he mostly means as a way to get around currency controls. Obviously if the government comes with the police you can be confiscated

But for example, Argentina has incredibly harsh currency controls, any freelancer or company that tries to export goods or services gets paid half the value per dollar and is forced to sell their dollars to the government

While companies can't really avoid it, most freelancers go around the control by using crypto and so can get the full value of their work

The government has to physically come and take it from you. They cannot remotely freeze Bitcoin like they can with conventional financial instruments.

I bet a tyrannical government can easily confiscate your BTC with enough "enhanced interrogation".

It's true. It would be a lot more difficult with something like a privacy coin. Someone could write down a 12/13 word phrase as a hot wallet and have a cold wallet with a memorized phrase. No one knows how much are in either wallet or that the two are even linked.

Pretty sure after they break out the blowtorches you’ll be volunteering this information…

Torture works a lot better if you know what you're looking for. With BTC you know exactly what it is you're looking for and how much. If all you know is they paid with a privacy coin then you have no idea how many wallets they have or how much money, there's no more advantage to giving up 2 wallets than 1 as there's no reason for an attacker to not think there's a 3rd you're holding out on if they didn't believe you the first time -- the options would be give up everything and get blow torched or give up only some and get blow torched

Rubber-hose cryptography: https://en.m.wikipedia.org/wiki/Rubber-hose_cryptanalysis

Doesn't even need to be governments. A man was tortured in his home with a drill in front of his 4 year old while being robbed of his bitcoin:

https://www.ccn.com/dutch-bitcoin-trader-suffers-brutal-tort...

Crypto bros thrive in an extremely abnormal environment where violence is controlled and outsourced to a powerful central authority. Good thread on this:

https://threadreaderapp.com/thread/1579124072390463488.html

> Bitcoin cannot be confiscated by the government, specially third world tyrannical governments that seem to always be trying their hardest to impoverish and screw those under their administration.

This just seems apt: https://xkcd.com/538/

> And unlike those things, Bitcoin cannot be confiscated by the government...

The IRS seized $3 billion worth about a year ago. https://www.irs.gov/compliance/criminal-investigation/histor...

There's a major difference between confiscating something that they first have to get their hands on (physically or digitally) and confiscating something like your bank account which doesn't require more than a phone call.

See for example the Canadian government freezing bank accounts[0] of anyone trying to contribute to the vaccine mandate protests.

[0] https://www.bbc.com/news/world-us-canada-60383385

1. Can you point any company in recent history that went through bankruptcy/auction to pay is retail investor their money back... or for that matter, most tech companies with negative net income does not pay dividend either...

2. So called, "Money" does not pay dividend... does Gold pays dividend? now on the other hand, I can lend you BTC or Gold and ask you to pay me back the principle + interest on it in BTC/Gold etc so that is that... Fiat money can yield as it can be created of thin air, no actual work required (i.e. mining for Gold or BTC)

3. Any currency, company also can be replaced by something else out there but won't why? network effect, trust and liquidity matters...

> 1. Can you point any company in recent history that went through bankruptcy/auction to pay is retail investor their money back...

Hertz: https://www.cnn.com/2021/07/01/business/hertz-bankruptcy-car...

1. The point of bankruptcy is liquidating assets to pay debts. Whatever is left after that is distributed to the shareholders.

2. Money does pay "dividend" - it's called "interest".

> Money does pay "dividend" - it's called "interest".

Only if you lend it.

Money sitting around under a mattress tends to lose value due to inflation.

Actual specie, dug out of the ground, tends to hold its value, relatively speaking. Sure, their may be shocks like discovering a whole continent made of gold but those are pretty rare.

Bitcoin, who knows? It simply hasn’t been around long enough for its place on the money pyramid to be found.

Why even make shotgun arguments?

2.a. Gold is an asset and doesn't need to pay dividends as it has intrinsic market value.

2.b. Loans and interest are contractual agreements, i.e. financial instruments unto themselves that generate value. Just because you get suckered into agreeing to a hobby money loan doesn't mean the hobby money has any value.

2.c. Variable cost doesn't equal value either. You can burn a stack of $100 bills but that doesn't mean that brief fire has any value, but it sure as shit didn't help the planet either.

What exactly is the point of this mental gymnastics? For all this talk, how much of your crypto have you actually used as currency to buy things with? 50%? 20%? The typical Bitcoin holder spends 0%. The haters aren't the barrier to your libertarian wonderland--it's the people who actually buy and HODL.

> Unlike the things you pointed out, Bitcoin will never give dividends or have any assets sold at an auction.

Crypto allowed me to transfer my wealth across border and helped me survive while Visa blocked my cards and local banks harassed me with their KYC/AML requirements and creative nonsense based out of fear of the US and EU sanctions. The utility of that is much higher than any dividends.

> Instead it's a pyramid scheme, easily replaceable by any other shitcoin out there, and the value of it should be close to $1 or less.

Wow, shitcoins sound so much worse than pieces of paper that are propped up by a legal decree, which legitimacy rests solely on the monopoly on violence. Wait, does it actually sound worse?

Society is propped up by legal decree and violence. CryptoKitties didn't change that.

> Society is propped up by legal decree and violence

and a currency whose value approaches zero as time grows. if bitcoin is bad, how is that much better?

The former is actually being used to run businesses and as long as the currency is not a demurrage currency, you are going to have to accept inflation as the thing that keeps money in circulation.

> The former is actually being used to run businesses

run businesses? to say nothing about whether those businesses are sustainable or actually generating wealth & human prosperity. if you look at all the worst aspects of the economy, they're based in expansionary monetary policy and high time preference

> inflation as the thing that keeps money in circulation

it keeps people spending money on usually wasteful things and incentivizes the consumption of cheap goods, if you want an economy built on prosperity and enduring goods, you need to actually incentivize saving (not wasteful consumerism)

Btc is only valuable if you can exchange it to fiat, since your liabilities are still in fiat. You need fiat to buy groceries, pay mortgage, buy energy for mining etc…

> Btc is only valuable if you can exchange it to fiat

surely people value things other than paying off liabilities?

Are you actually using BTC as currency? Have you done anything but traded it? We all know the answer--that's why this meta commentary on money is pointless and pathetic.

> meta commentary on money is pointless and pathetic

why are you getting so defensive about the fact that fiat currency exponentially decreases in value

An interesting read of the quoted text since the topic that is supposedly being defended isn't even mentioned.

This is an attack on this whimsical philosophizing crypto-boosters use as a defense. No one cares about this "what is money" commentary. If you believe in your moon money so much why not just actually use it as money? Of course you'll have to lose those gainz but real money is just worthless paper right?

> If you believe in your moon money so much why not just actually use it as money

I don't buy stuff with it though it's being used to facilitate transactions for people. I route around $40k a month.

Why did visa and the banks question you? What were you really trying to do?

Most likely leave Russia, Iran, or Venezuela.

Yes crypto has the evil property of bypassing KYC/AML to allow peaceful citizens to escape genocidal kleptocratic governments who seek to draft you to go into war with a WWI era Mosin a feminine hygiene product as a first aid kit and an oversized pair of rotten boots. Once again crypto proves to do nothing but aid and abet criminals such as those who refuse to invade their neighbors.

You are being downvoted but the point you make stands: there are a lot of people here who will jump at the opertunity to proclaim that crypto's only use is a ponzy scheme. That claim is not only objectively false, but they way they usually phrase it also preemptively shuts down any chance proponents of either side coming closer to seeing how this tech is actually used.

Whether it be war, tyranny and unjust sanctions, crashing economies, or just avoiding the arbitrary and often unjust fees, rules, seizures, and bannings imposed by private payment networks and services like paypal or visa, humanity will always need way to exchange cash. I for one am glad crypto (as a means to transfer funds) exists, glad it will continue to exist, and will continue to support it in any way I can.

To me, what it provides to humanity far outweighs the negatives.

No, I think everyone agrees that "evading the law" is another feature of cryptocurrencies. We simply don't think this is a good feature.

Trillions of dollars are stolen from the people by money laundering and tax evasion every year, and cryptocurrencies are one of the ways this is accomplished.

Yes, some people live in countries where the law is hostile. However, your solution, "Let's evade all laws concerning money," is WORSE, not better.

Trillions of dollars are stolen by government officials wastefully spending taxes they collect via mechanisms of force and by people who classify as "money laundering" activities they don't like -- such as people who grow weed and then sell it to a willing adult buyer and have the nerve to actually clean the cash so it can be spent on stuff like buying baby formula or the rent.

If the argument is bad stuff possible then your argument is to abolish government.

We cannot presuppose that breaking the law is necessarily bad or that following the law is not bad.

This argument applies just as much to cash as cryptocurrency and makes no sense.

I was trying to leave Russia.

The monopoly on violence actually sounds better to me. I am a big fan of violence, when applied against certain types of anti-social people.

My fetish is unnecessarily-superior firepower against people advocating for violence (and also their families)

You are talking about shooting police officers, judges, law enforcement, and the people who support the law, as well as as their families.

I'm not going to pretend to be surprised - many American conservatives have expressed the same sentiments to me. However, I am surprised you post it in a public forum.

I think insurgent is the word, I grew up with conservatives and they are not like this

I long suspected that "monopoly on violence" is a dog whistle. So I looked it up, and actually it's quite straightforward. If you think about the number of entities in a society that can legitimately control violence, the answer is either zero, one, or many. Zero is a pipe dream. Many is civil war. The only answer that makes sense is one. Thus "monopoly on violence" is just a scary sounding way of saying that a society has a government.

In my view, society is propped up by future expectations. This includes the value of government money.

Monopoly on violence is the defining property of the state according to Max Weber, one of the most famous sociologists. In what way is it a dog whistle?

Because it's only used by people in a tiny little political segment today - far-right-wing libertarians.

No one else denies this or doesn't believe it's true, I hasten to add. For most of us, we think that this is a good thing, but also such an obvious thing that it doesn't need to be mentioned.

The people who keep mentioning it are people who think it's a bad, bad thing. They want everyone to have access to violence at all times.

The sane majority does not.

In the “jungle” you only own what you can protect. Even your life. Violence is natural. Non-violence, property rights and free trade is extremely unnatural, and requires a strong central authority to write the rules and impose them.

Do you think it’s bad to put a teenager in jail for an abortion they did after they had been raped? Or is it also a good (well, it is certainly lawful) use of state monopoly on violence?

if the teenager is woke, its good. and a non woke person would never be prosecuted by any sane government, so your logic game is flawed

> far-right-wing libertarians

No. If your going to targrt political stratas, don't be narrow sighted.

The BLM and Antifa riots of "Defund the police" is exactly about the same concern, and supporters caused widespread violence to prove that point. There's a different reason, but many prominent Democrats urged those protests on, making it more broad than just some leftists commies.

The major difference is that BLM/antifa targeted local police with a national organization and got their way in many places, whereas conservatives are weary of the federal government are just some disorganized people that become easily targeted by the feds.

There is a saying, an armed society is a polite society.

I have no idea where you came up with "Many is civil war". Quite the opposite. Civil war erupts when one entity has a monopoly on violence and enough people decide that they've had quite enough of that, thank you very much.

> There is a saying, an armed society is a polite society.

There are all sorts of sayings. Is this one true?

The United States is the most heavily armed country of any size in the world. It is also more heavily armed than any time in its past.

And yet politeness appears to be at an all-time low. Certainly, a lot of political figures say things that are just astonishingly rude and horrible and false, things that would have destroyed their careers even twenty years ago but seem to make them very popular today.

It seems that saying is wildly false.

> I have no idea where you came up with "Many is civil war".

Probably they are knowledgeable about history, as their statement is simply true.

> Civil war erupts when one entity has a monopoly on violence and enough people decide that they've had quite enough of that, thank you very much.

I'm baffled as to how this makes sense to you.

How exactly do these people "decide they have had enough of that" without abrogating the states monopoly on violence? Surely by the time you get to civil war, there are _two sides fighting_??

It's like you just cut and paste a lot of slogans and stop thinking critically there.

I really suggesting reading some history.

> local banks harassed me with their KYC/AML requirements

So you use crypto to break the law, and you believe you are justified in doing that. Thing is, most of the people using crypto for crime are simply using it to not pay taxes.

> Wow, shitcoins sound so much worse than pieces of paper that are propped up by a legal decree, which legitimacy rests solely on the monopoly on violence. Wait, does it actually sound worse?

Yes, it absolutely does sound worse.

On one side, we have the United States - the largest economy in the history of the world, backed by the government with the largest income of any government in history, a court system, the police and their "monopoly on violence".

On the other side, you have a cryptocurrency backed by nothing, created by anonymous individuals, with no form of conflict resolution whatsoever.

Cryptocurrencies have been around for almost as long as the smart phone. You would think one or two of you would have taken even a first year economics course during this time.

> So you use crypto to break the law, and you believe you are justified in doing that. Thing is, most of the people using crypto for crime are simply using it to not pay taxes.

Using it for crime? That just makes crypto even more similar to traditional finance.

> Yes, it absolutely does sound worse.

So you think all countries should switch their currencies to the US dollar? Do you think it is just as good for countries to give up their financial sovereignty as it is for common people?

> Cryptocurrencies have been around for almost as long as the smart phone. You would think one or two of you would have taken even a first year economics course during this time.

I was a teaching assistant for a graduate course in macroeconomics in a top 50 department during my PhD. Arrow-Debreu and all that.

> transfer my wealth

I don't think _anyone_ is against using cryptocurrencies as a way of transferring money. It doesn't make sense to transfer wealth via something that rapidly changes its value, right? Because means of transferring wealth requires preserving the value of the wealth. Bitcoin today does not preserve its value, as evident by the rapid decline in value in the past few days.

I'll happily buy Bitcoins from you for $1. In fact, I'll even give you $100 per Bitcoin. Deal?

Sorry, fresh out of BTC (I was all in on this Celsius get rich quick scheme!), I'll have some tulips in the spring though. $100 each, sound good?

How about LUNC?

Maybe so, but there was another article not long ago talking about how, while originally bitcoin was expected to act like gold - ie go up when people worried about the stability of the financial system, what happened instead is that it's basically just correlated with the stock market. So in that light, the GP comment is useful context. Even if you think that long term it's a pyramid scheme, its short term performance is basically explained by the stock market, and is not evidence of the scheme unravelling, or whatever you might call it

it correlated with the stock market because the local courts allowed public companies to let the public decide whether or not they could buy into crypto currencies and put it on their balance sheet.

Just as a matter of history:

- BTC was originally intended to support smart contracts

- but people pitched “digital gold” because they didn’t understand that vision

- then the capability was removed for “safety”

- and then later ETH came along (with a different model), but one that still is too costly for general compute trade and which is inflated by the gimped-BTC bubble

- we’re watching that fools gold bubble pop

- and new ideas about compute for sale emerge [1]

And in the near future:

- eventually, tokens will represent real things with the interop currency being the one for buying compute time

[1] - eg, https://github.com/lucasgleba/zkRiscV

<< the value of it should be close to $1 or less.

Value ( and by extension price ) of anything is what people are willing to pay for it. Some digital cards in a Blizzard game were purchased for thousands of dollars. There is some digital real estate that was purchased for millions. We can argue all day long whether it makes sense and what the value should be, but that is the wrong perspective to begin with.

<< will never give dividends

Even now I can easily point to stocks that never paid dividends.

<< it's a pyramid scheme

At this point, it is a pyramid scheme the same way US dollar is a pyramid scheme.

> digital real estate was purchased for millions.

It was purchased for millions AT THE TIME OF PEAK MANIA . big difference

Also it was purchased for millions by the only guy in the world willing to pay millions for it…

Don’t extrapolate or you risk making an hypothesis of liquidity and price permanence which is just not there

A mansion in Naples or San Mateo was worth millions in the 1980s, 90s , 00s , 10s , 20s and there are millions of potential buyers globally who’d happily pay that price. That’s an asset which proved both liquidity and price permanence (matter of fact appreciation) but still it’s not a given that it will prove to be such going forward

<< A mansion in Naples or San Mateo was worth millions in the 1980s, 90s , 00s , 10s , 20s and there are millions of potential buyers globally who’d happily pay that price. That’s an asset which proved both liquidity and price permanence (matter of fact appreciation) but still it’s not a given that it will prove to be such going forward

If there is one thing that 2008 should have taught anyone, it is that nothing is permanent. I am not going to get philosophical here and say that possessions are fleeting, but to pretend that real estate is not propped up hard and effectively is guaranteed to "prove to be such going forward" is about the same faith that keeps ANY asset including bitcoin up.

Why are you so certain that this timeline will never see Naples mansion price go to zero? I can easily see several scenarios where that could happen.

>At this point, it is a pyramid scheme the same way US dollar is a pyramid scheme

Yeah the dollar is a pyramid scheme. It has the same construction flaws as Bitcoin. You can withdraw it from the markets and just hoard it which causes deflation. The central bank then allows commercial banks to increase the money supply instead of increasing the circulation velocity. The problem with newly created money: it can be hoarded too, resulting in an infinite doom loop.

There is some value to brand recognition and being well known. I doubt it's 16k of value however.

But market believes it is.

The market believed in LUNA and FTT as well. Luna's market capitalization was $40B at one point.

> Bitcoin will never give dividends

Niter will Tesla shares, yet people still buy. Its purely for resale at later stage.

> - AMZN under $100 (Down 48% YOY) - GOOG under $100 (Down 42% YOY) - AMD under $60 (Down 59% YOY) - META at $101 (Down 77% YOY)

To be fair, many of the big companies (at least Amazon, Meta, Twitter) have gotten front-page articles about their losses with people laying into them.

Yeah, FAANG stock imploding has been on headlines for months now.

Why wouldn't BTC get the same treatment? OP must be a bag holder.

You have coin in your handle. Far more likely that you're hyper-sensitive to news you think is a slight on crypto. I have seen threads about Meta and Amazon losing enormous amounts in market cap in the last week. Maybe you're the one who needs to stop paying attention to detractors.

For me, it's because I genuinely dislike the Bitcoin cult. They are detached from reality and have a sense of superiority. Something about that really annoys me and I want them to "lose". I feel the same about investors in GME and to some extent extent TSLA.

If bitcoin is gold, shouldn't it be moving in the opposite direction? If it isn't, why not buy AMZN, GOOG, AMD, or META, who are all doing as good or better?

And since bitcoin isn't a tech stock, but a "currency," why wouldn't you compare it to the S&P (down 19%), DJIA (down 10%), or the USD (up 17% against UKP, 15% against EUR)?

Your last post:

- Amazon Becomes the First Company Ever to Lose $1T in Stock Value

I'll let it speak for itself.

My best explanation is an psycho-economic-reactance model. It hypothesizes that the largest crypto-pessimistic voices are engaging in the hyperstitious[2] manufacturing of a desired crypto collapse. The desire to foment crypto-collapse stems the reactance one imagines oneself experiencing in a thoroughly crypt-infused world. Allow me to draw a parallel.

There exists a contingent of folks who experience psychological reactance at the thought of having to make decisions with respect to government oversight. They "[experience] motivation to regain a freedom after it has been lost or threatened – leads people to resist the social influence of others" when faced with the prospect of having to deal with the government. We all know people like this.

The same reaction exists when people feel they will be forced to make decisions with respect to crypto - a system they didn't and don't wish to participate in. No amount of reasoning is going to make someone amenable to government interference in the same way no one is going to be reasoned out of being currency-interfered with by those wish to establish a crypto-hegemony.

1. https://www.ncbi.nlm.nih.gov/pmc/articles/PMC4675534/

2. http://www.xenopraxis.net/readings/carstens_hyperstition.pdf

People on here get worked up about it because they all know someone who made a lot of money in it that they see as unearned -- it comes down to jealousy or schadenfreude, I suppose. The guise of caring about the externalities or the grandmas is always a front, if we're being totally honest with ourselves.

Because to your point, it's completely voluntary to get involved, and if someone is pretending to care about all the (relatively few) grandmas who put money in, well, they're losing money so this person shouldn't be so happy about it.

And as for the energy externality, the vast majority of crypto hashpower has hook ups to power plants where during certain times of the day/year, there is excess power and nowhere to put it, so they sell it dirt cheap to miners. I know someone who worked for a US solar power provider that had such an arrangement. Sure, some people are mining from their college campus and stealing power to do so, but the cumulative real effect of this relatively low profit activity is dwarfed by the out of context numbers you see in articles.

So at the end of the day, the crypto hating is just people playing zero sum status games, hoping they somehow benefit relative to the decline of others (just as the crypto people are playing zero sum wealth games). It would be nice if everyone could just be honest about it.

I don't know what you are taking about. I hate cryptocurrencirs because they perpetuate the current fiat currency system that originated from the gold standard. The reason why Bitcoin has this massive amount of volatility has to do with the way it is constructed. Just like with conventional fiat currency there is no way to pay off debts with Bitcoin because the additional demand for Bitcoin will increase the value of Bitcoin denominated debt.

The news we constantly hear is "Hackernews 10/Dec/2022 Changpeng on brink of second bailout for cryptoexchanges."

It is like Bitcoin is supposed to send a hyperexaggerated message about our current money system and how unsustainable it is.

The answer is already obvious you have negative rates or not. The positive interest side of the loanable funds model is the side where new debt is taken on, the negative interest side of the loanable funds model is where debt is being paid off. We want to be on the negative side now because we have too much debt.

FWIW I think I have seen most of those titles posted to HN over the last few months.

e.g.

1. https://news.ycombinator.com/item?id=33357289 2. https://news.ycombinator.com/item?id=33379932

Anyways, a sharp decline in cryptocurrency markets caused by the continuing house-of-cards is almost certainly going to make front page HN.

> What is it about bitcoin that brings people into these threads to say "good riddance! I hope it dies because all of it's negative externalities."?

> To the oblivious observer it would appear cryptocurrency lives rent free in many heads in this space. If you don't care for it why pay attention to it?

The environmental impact is something everyone should care about

It's popular to hate cryptocurrency in some circles.

I think that mainly that is what drives the hate, just network effects. It's popular to hate because everyone's doing it.

But also, unfortunately cryptocurrency's reputation has largely been ruined by scammers. Because it's like any high technology, it multiplies the power of those who use it. Including the multitudes of low-lifes out there.

The biggest issue though is that people fundamentally do not understand what cryptocurrency is or that it has core advances in digital signatures and blockchains that make legacy trust-based financial systems obsolescent.

It also represents in some ways how technology has made all sorts of institutions and paradigms obsolete. Those who are profiting from these previous paradigms and/or are less cognitively adaptive subconsciously are threatened by these types of changes.

No, we understand it pretty well and the "core advances" in signature and blockchains haven't obsoleted anything.

Nothing has been made obsolete, nothing about Bitcoin replaces any existing financial institution.

Anyone who understands cryptocurrency understands how it doesn't make the old financial system obsolete. If anything it reminds people how good their day to day life is because their government is relatively competent at managing the national currency compared to an unregulated currency.

The fact that 99% of cryptocurrencies have no reason to exist including Bitcoin is visible in RAI. RAI is the Swiss franc of cryptocurrencies among hyperinflating nonsense.

What RAI represents is effectively a currency with an entirely computer controlled central bank just like Friedman dreamt of. Now that is possibly the greatest invention of this century. It is battle tested in one of the harshest environments. While every other currency(crypto or not) is dropping like flies, RAI is only dropping as fast as the Swiss franc which is hardly losing its value.

> It also represents in some ways how technology has made all sorts of institutions and paradigms obsolete. Those who are profiting from these previous paradigms and/or are less cognitively adaptive subconsciously are threatened by these types of changes.

I don't know what is going in your head but I could easily accuse you of the same. RAI represents how technology made the old paradigm of hypervolatile currencies obsolete. Bitcoin traders who were profiting from this paradigm or people who are unable to understand computer controlled monetary policy are theatened by these types of changes.

By the way, mining rewards are not a monetary policy because they don't take the supply and demand for Bitcoin into account, nor is there a way to get rid of excess Bitcoin.

AMZN, GOOG, META, AMD, etc. did not really hurt ordinary people. When Bitcoin was shooting up it really kind of screwed up humanity by unexpectedly raising electricity demand and electricity costs.

> …did not really hurt ordinary people.

Are you sure about that? Really, think about it…

To me the real question is why isn’t bitcoin skyrocketing in value? If crypto is susceptible to inflation worries, what is the point?

I would say because this is a correction. The demand for BTC was up due to speculation. As the perception of risk increases in general, there will be less speculation.

>>What is it about bitcoin that brings people into these threads to say "good riddance! I hope it dies because all of it's negative externalities."?

Because many became rich riding the first crypto wave. And they missed out. It strikes them as an injustice and as some consolation, they would like to see crypto crash burn.

If I can't have, neither should they.

Yeah, it’s really a mystery why news about a techno-utopist technology would show up on a technology focused website.

The one thing which is satisfying for me about this crash is that, as a developer working in the cryptocurrency space, I was constantly looked down on by the mainstream FAANG tech crowd. They kept telling me "Crypto is a bubble, there's nothing behind it" and I would say back to them "Yes, but with all the money printing that's been going on and distorting the markets, how can we even know which company in the stock market is backed by real value?"

And now look at what's going on; big tech stocks crashed faster than crypto did. In a realistic economic environment, could these stocks be worth less than 'worthless' crypto? The effect is even more dramatic than I thought. It confirms my beliefs that the economy of the last decade was a kind of lucky lottery system.

None of the tier 1 tech stocks have any chance of bankruptcy.

There is still a tiny chance. Crypto has 0 chance of bankruptcy.

This is because cryptocurrencies aren't even companies; they have no directors, no board members, no debt, no assets. It's impossible for them to go bankrupt.

Also, companies can become nonviable and be shut down. On the other hand, it's almost impossible for a crypto to become nonviable... There will always be some tinkerers willing to run nodes at a tiny annual loss. PoS cryptos are very cheap to operate.

Lack of a meaningful consensus network would be pretty similar, in the sense that someone holding that currency wouldn't be able to get anything in exchange for it.

Well, it'd likely be worse than bankruptcy, because there wouldn't be any assets to go after in court.

That won't happen because there will never be a shortage of fools and degens who will buy crypto. Same reason why gambling will always exist. Crypto is better at attracting speculators because it's not as constrained by regulations and even if price drops 80%+, people immediately start telling themselves "I'm in it for the technology and/or social mission" and this keeps them HODLing until the next bull run.

Stock investors tend to think more like "This stock just dropped 80%, I have to cut my losses... Switching to value investing. Bye."

Crypto could easily go to zero if everyone agreed that is what it is worth.

I mean, FTT just went from $25 to something in the $2 range since the whole FTX thing blew up. And it will probably hit zero soon -- I have no idea why anyone still wants it.

> I have no idea

You have no idea.

Certain large crypto companies have gone bankrupt causing their customers to lose all their funds whereas I’d claim purchasing meta stock at this point in time is a much safer position.

Because it's a fucking scam, that's why. Aside the technology behind it, the coin itself offers no value whatsoever. Not to mention all the resources used to mine it.

Bitcoin is not above criticism nor are the companies you mentioned (all of which have been criticized for various reasons on this platform).

Are you confused about why the HN community would be more interested in big moves in the first cryptocurrency rather than in BLK or AMZN?

Turned out that BTC is not an inflation hedge.

There's been a bunch of posts about how much Meta's stock has fallen that have hit the front page.

Thinking it is harmful is different than "don't care for it".

> lives rent free in many heads

Do you normally charge rent to remember concepts you find ridiculous, evil or toxic? How much rent do you charge, say, "scientology" or "child abuse" for the mental real estate they are squatting on in your head?

I see crypto as the embodiment of unchecked greed. The massive amounts of energy it destroys is such a major middle finger to everyone. The current financial system wasn't bad enough. They had to take the brakes off.

> amounts of energy it destroys

https://en.wikipedia.org/wiki/First_law_of_thermodynamics

Should the value of Bitcoin be rising with inflation?

By definition, the value of everything rises with inflation. That just tells you that in the absence of inflation, prices now would be lower than they are now. It doesn't tell you whether prices now are higher or lower than they were yesterday.

To be precise, the value of money sinks. The value of bread to everyone involved stays the same.

Said differently: the price of everything rises, not the value.

And another nitpick: by definition the average/median price rises, not the price of everything (afair).

Since bitcoin itself is a currency though, I'm not sure how inflation really applies across currencies (since there are "prices" both ways).

> To be precise, the value of money sinks. The value of bread to everyone involved stays the same.

The value of bread as measured in money rises. I'm just using the terminology from the parent comment.

> And another nitpick: by definition the average/median price rises, not the price of everything (afair).

No, that's wrong. The value of money sinking is exactly the same as the price of everything rising. That is the meaning of "the value of money"; there is not even a theoretical distinction between these concepts. If the value of money falls in half, then all prices, of everything, have increased by 100%.

> Since bitcoin itself is a currency though, I'm not sure how inflation really applies across currencies (since there are "prices" both ways).

There seems to be some kind of conceptual confusion here. Currencies inflate (by losing value), or deflate (by gaining value), or don't (by maintaining the same value; in reality this can't happen).

If one currency inflates more than another one does, then the exchange rate between them will shift. (It will take more of the first currency to buy a constant amount of the second one, or less of the second one to buy a constant amount of the first one.) If two currencies inflate by the same amount, then the exchange rate between them won't shift. What's your question?

Everyone (including you) knows what he means.

The only alternative I see is that you're proposing bitcoin's price should generally rise faster than inflation when inflation is positive.

Is that really what you mean, and what you think my parent comment meant? Inflation is a mechanical thing; to get that effect, you'd need a financial instrument that was specifically defined to produce it.

He meant that the price of BTC expressed in USD should be going up with inflation.

It is. If you want people to understand that you have some other meaning than that, you're going to need to phrase it better.

Exactly.

> What is it about bitcoin that brings people into these threads to say "good riddance! I hope it dies because all of it's negative externalities."?

The negative externalities.

> To the oblivious observer it would appear cryptocurrency lives rent free in many heads in this space. If you don't care for it why pay attention to it?

Because it affects people. A lot of people needed graphics cards for not just gaming, but for 3d animation, video making, and video games during and after lockdown.

Ethereum was responsible for very large price increases and scarcity of graphics cards. The collapse of Ethereum eventually brought supply back to graphics cards-but we still have these inflated prices. Early in this recent crypto boom it was impossible to buy a mainstream card ($250-$400) while the top end cards were available because mining profitability on the mainstream ones was much higher.

This is before you consider that the high demand also attracted scalpers and the environmental issues.

Because HN is now mainly a forum for FAANG employees, as opposed to founders like it used to be. FAANG cannot control Bitcoin, thus its management and thus its peons view it as a problem. Switch to https://stacker.news instead

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