Bitcoin price hits $100K for first time in history
cointelegraph.com
cointelegraph.com
However, I am concerned about the security model on a 5-10+ year perspective. Miners secure the blockchain and get paid for it in bitcoins. We have seen that the mining has become more and more sentralized as the mining gets progressively harder (as by design). Progressively harder mining means that the price of bitcoin must rise in pararell to cover the expenses of the miners securing the network.
Here are my concerns:
- Increasingly centralized mining means a higher risk of a 51% attack (controlling 51% means you control the entire network).
- Bitcoin not able to maintain a constant price growth that will lower the incentive to keep mining as the difficulity increases.
- Quantum Computing actually cracking the encryptions which will kill the entire network instantly.
- Instability in the world might lead to spikes in electricity prices, which will affect the incentive to secure the network with mining.
I also think spending so much energy on security, when there are other viable options available is insane in our current age.
Transitioning to a Proof of Stake model like Ethereum instead of a Proof of Work model would be much more robust with a fraction of the power consumption, but thats just my opinion.
every 4 years there is a halving event where the btc reward is cut in half. Eventually all btc will be mined and the only role of miners will be to process transactions and they get to keep the fees. that will be the incentive
i agree, Ethereum might be the better approach.
i'm not too concerned about the electricity usage in the long term. for btc it will be less and less profitable for miners to operate consuming large amounts of energy. as the price plateaus and mining rewards decrease, energy consumption should also plateau. that is if energy price stays the same and doesn't become cheaper.
I stopped following Bitcoin closely a decade ago, so I might be wrong, but I think the issue is the following. Mining was supposed to be eventually financed by transaction fees instead of the mining reward but the usage of Bitcoin for payments never really materialized. So there are not enough transactions to pay for the mining costs at reasonably low transaction costs. This also interacts with the low transaction limit of Bitcoin, even if people wanted to use Bitcoins for payments at large scale, there is no capacity for that. And the other way around, without the necessary capacity, transaction fees will be high, which will deter people from using Bitcoin for payments.
It will not. This issue was talked as far as 2012.
The energy use is a big one people who don't think it through keep coming back to (thanks to the WEF planting this bogeyman back in 2017 or so). Miners do not operate when the cost of electricity is high, for economic reasons. What they do, however, is look for stranded power. This has led many to operate where gas is otherwise being flared, as well as on wind turbine and other green power sources, making it economical to build them out as it creates demand. That demand in turn falls off if other use for the power materializes, but is there to pick up the slack if the surplus re-emerges.
These are a few examples, of which you'll find many if you bother to look. Bitcoin in many ways serves as a battery to balance demand for energy, and may well be one of the greener initiatives out there. Which certainly can't be said for traditional banking infrastructure.
It is not. It has multiple >70% drawdowns over the last ~decade:
* https://newhedge.io/terminal/bitcoin/price-drawdown
During the 1930s US stock market crash, things went down 90% and, a century later, has never been that bad. Bitcoin has had multiple Great Depression equivalent drops in one-tenth the time.
Something that is a good store of value should not be volatile: it should keep it's value, or at least be fairly predictable in the rate of decay.
If it mostly goes up, it's still a good store of value, even if the volatility is high.
So far it outperformed every fiat currency on the planet.
So does the stock market, but if I want to buy a house in 2025, I don't keep my downpayment savings in the stock market but rather in a savings vehicle that protects the principal. I don't want something that goes down (or up) regularly if I want to store value: I want something that is predictable so when I go back to it to spend it (the whole point of currencies) I have a rough idea of what I'll have to work with.
> So far it outperformed every fiat currency on the planet.
The point of currencies is not performance but stability.
Could it be that there is a path to medium of exchange ->store of value? -> unit of account?
That could explain the volatility while the market prices it correctly
Even if we grant that, Bitcoin has probably not reached that point (yet?).
One of the comments "I've been watching the price of BTC rise pretty steadily in the last few days but I can't bring myself to believe that this price range is in any way sustainable. $4 per bitcoin? ..."
If someone says he's betting on stock X, the opposite is not to go short. That's one way of doing "not what he did". Another way of doing "not what he did" is to for example sell a PUT, because maybe you think it's just going to stay flat. Another way is to not do anything, and instead wait, because going short costs money (you're borrowing a stock and borrowing fees on it), and so the act of shorting itself can lose you money if he isn't "wrong fast enough". So is the opposite to short it on the day he says he's buying, or is the opposite to short it the next week? Even "pure opposite" situations would require exact entrypoints and exit points which you wouldn't have.
You literally fell for the exact thing I was describing.
And not doing anything clearly isn’t the opposite. If someone says he’s going North, what’s the opposite of that? It would be going south, even though you could go west or east too, or just do nothing. Just because it’s a spectrum with more than one dimension doesn’t mean that some actions don’t have an opposite action.
Selling PUT options is equivalent to being long i.e. the more the stock price goes up, the more money you can make.
The OP seems confused.
They don't actually have to be positive every year. They just have to do better than comparable indexes. It's hard to tell the value of a strategy after just one year.
News technologies will require more and more energy.
> For me personally this enough reason to ban bitcoin
It's possible to ban bitcoin?
Just tell them you're training a new foundational model.
Everyone is trying to build this.
Training an LLM is not actually working on AGI just as people building skyscrapers aren’t getting to the moon. It’s an inherent limitation on the approach.
First sentence: "We see Neuro-symbolic AI as a pathway to achieve artificial general intelligence"
You said you don't believe LLMs are capable of ever getting there, so I offered a link showing people are trying other things as well. My point was never "Everyone is doing novel, non-LLM work towards AGI".
But everyone is in fact trying to get to AGI:
Google: https://www.fastcompany.com/91233846/noam-shazeer-back-at-go... https://deepmind.google/research/publications/66938/
Microsoft: https://www.microsoft.com/en-us/bing/do-more-with-ai/artific...
Meta: https://www.theverge.com/2024/1/18/24042354/mark-zuckerberg-...
Salesforce: https://www.forbes.com/sites/johnkoetsier/2023/09/12/salesfo...
Not to mention obvious suspects (OpenAI, Anthropic etc). Just because you think it won't work doesn't mean they're not trying. Everyone is trying to get to AGI.
Your other examples are giant companies with many focus who can trivially pay lip service to fundamental research without spending any particular effort. Take your link:
“Benioff outlined four waves of enterprise AI, the first two of which are currently real, available, and shipping:
Predictive
Generative
Autonomous and agents
Artificial general intelligence”
IMO, the fundamental requirements for AGI need at minimum: A system which operates continuously, improves in operation, and can set goals for itself. If you know the work you’re doing isn’t going to result in that then working towards AGI implies abandoning that approach and trying something new.
Basically researching new algorithms or types of computation could qualify, but iterative improvement on well studied methods doesn’t. So some research into biological neurons/brains qualifies but optimizing A* doesn’t even if it’s useful for what you’re working on. There’s a huge number of spin-offs from AI research that are really useful and worth developing, but also inherently limited.
I’m somewhat torn as to the minimum threshold for progress. Tossing 1 billion dollars worth of computational power at genetic algorithms wouldn’t produce AGI, but there’s theoretical levels of processing power where such an approach could actually work even if we’re nowhere close to building such systems. It’s the kind of moonshot that 99.99…% wouldn’t work, but maybe…
So, it may seem like moving the goalposts but I think the initial work on LLM’s could qualify, but subsequent refinement doesn’t.
Edited with some minor clarification.
What's your evidence for this?
But the current LLM process separates learning from interacting and the learning process is based on huge volumes of text. It’s possible to bolt on specific capabilities like say a chess engine, but you’re now building something different not an LLM.
during euro/asian hours price will go sideways or go down, then during US hours you get the huge moves up or down
i'm guessing all financial markets are like that. it's like US is a behemoth
Seems unlikely tho for this reason.
i think US accounts for 25% or over of global wealth, so it makes sense the big moves come from there.
Expected sanctions devaluing other currencies, higher risk of conflict (eg Iran -Israel/US war) causing economic instability, ... ?
Most companies in the space have had "the government could, at any moment, make it nearly impossible for us to continue operating" as an existential risk, so if that risk goes down, the expectation for further innovation and development soars.
[0] https://apnews.com/article/sec-chair-atkins-gensler-investor...
I’m probably wrong though.
There isn't an "increase price so I can unload" button.
Microstrategy is also running a pyramid scheme. Surely, there are also hedge funds in the space playing all kinds of games.
It is interesting how the digital Yuan is rolling out right now as part of HarmonyOS NEXT while the stupid west waste time with these digital currencies that can't function well as actual currency.
At the highest level, I suspect this is a brilliant game of currency Kung Fu.
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Trump spoke glowingly about crypto this year on the campaign trail, despite casting skepticism upon it for years. At the Bitcoin conference in Nashville in July, Trump floated the idea of establishing a federal Bitcoin reserve, and stressed the importance of bringing more Bitcoin mining operations to the U.S.
Perhaps most importantly, Trump vowed to oust Gary Gensler, the chair of the Securities and Exchange Commission (SEC), who has brought many lawsuits against crypto projects for allegedly violating securities laws. Gensler is a widely-reviled figure in the crypto industry, with many accusing him of stifling innovation. Gensler, conversely, argued that it was his job to protect consumers from the massive crypto collapses that unfolded in 2022, including Terra Luna and FTX.
Gensler’s term isn’t up until 2026, but some analysts expect him to resign once Trump takes office, as previous SEC chairs have done after the President that appointed them lost their elections. A change to SEC leadership could allow many more crypto products to enter mainstream financial markets. For the past few years, the SEC had been hesitant to approve crypto ETFs: investment vehicles that allow people to bet on crypto without actually holding it. But a judge forced Gensler’s hand, bringing Bitcoin ETFs onto the market in January. Now, under a friendlier SEC, ETFs based on smaller cryptocurrencies like Solana and XRP may be next.
Many crypto enthusiasts are also excited by Trump’s alliance with Elon Musk, who has long championed cryptocurrencies on social media. On election night, Dogecoin, Musk’s preferred meme coin, spiked 25% to 21 cents.
11 years ago I sold 100 BTC, and made pretty good money. With that said, the more I think about BTC, the less sense it makes to me. Exceedingly few people actually use it for anything practical. The “store of value” functionality has completely eclipsed the practical use that Bitcoin maxis were preaching back then. Since 2016-2017, it seems like people have bought it for the sole purpose of seeing someone else pay more for it. It will never become some “universal” currency that overtakes national fiats. Right now it seems like people are only hoping for governments to hoard up BTC, to moon the price and provide exit liquidity for early holders - which IMO would be reckless spending. It is the ultimate make-believe asset.
Also, when I ran the numbers some time ago, I figured a realistic max value for 1 BTC would be 500k-1M.
So the big money has been made, imo. Betting on a good stock could make you just as rich, as waiting BTC to reach its max. Most money will be made buying and selling between the boom cycles.
Today, I view cryptocurrency prices as just another signal within the broader economy. While some of my companies focus on cryptocurrency research, security, and development I am not obsessed with trading.
[1] https://bitcoinist.com/meet-the-guys-who-paid-10-thousand-do...
[2] https://docs.google.com/document/d/1L0Me9si4iMclOq8n-oG2yNQf...
Extremely curious about your methodology here. Also I'm not sure how to process "the max value is only 5-10x from current prices so the big money has already been made". Can you explain?
Bitcoin is an asset like any other, there's no math I can do that will prove to you that someone can't just arrive tomorrow and buy this rock off of me for $2. And there's no math someone can do that can prove someone else won't show up the next day and offer $2 trillions for it, specially because their math can't predict inflation, or they'd be billionnaires on the futures market very quickly instead of showing off their math claims online.
For example, the total value of all gold is something like $10-20T. At 21M coins, if bitcoin fully replaced all gold you'd be looking at something like 500k-1M. I don't really get the difference between M1 and M2 for money supply but this is about the same as all US dollars.
So $500k-$1M seems like a realistic maximum value. That's different from "I think this will happen" and you can have a value much lower than this but the key part here IMO is saying "I cannot see a way it can be higher". I think there are other investments that require significantly less optimism to see 5-10x growth over any reasonable timeframe.
> Also I'm not sure how to process "the max value is only 5-10x from current prices so the big money has already been made". Can you explain?
A maximum upside of 5-10x assuming lots of things go extremely well for your investment requiring massive global shifts is a tricky sell. To make a huge amount of money you have to put a lot on the line.
So I think broadly this is just about whether you read "realistic max value" as "the maximum I expect this to reach" or "scenarios where it goes above this are unrealistic even with a lot of optimism".
That is actually fairly common. Gold has been around for millennia, found basically 0 practical applications [0]. The value of something is roughly the marginal difficulty of procuring the thing by whether someone wants to own it, and at the moment nobody can create bitcoin for substantially less than $100k and broadly speaking people will always want to own them at some price.
That being said, I don't think bitcoin will hold its value long term. But the money question now is whether the collapse happens on the scale of years, decades, centuries or millenia.
[0] The purpose of gold jewellery is to demonstrate that someone has gold/the wealth to do something impractical; otherwise we could make plastic jewellery that is prettier, lighter and cheaper.
47% of gold is used for jewelry and 6% is used for electronics:
* https://geology.com/minerals/gold/uses-of-gold.shtml#history
You're not wrong, but not entirely right either.
Plastic jewelry and other cheaper jewelry only really look good when it's new in a store. The main buyers of gold jewelry are Indians, who prefer higher karat gold, which looks good forever. The intersection between a non-reactive metal and a colorful metal make gold the ideal material for jewelry.
"Gold is suitable for dentistry because it is malleable, nearly immune to corrosion, and closely mimics the hardness of natural teeth, thereby causing no harm to natural teeth during chewing" - https://en.wikipedia.org/wiki/Gold_teeth
And not entirely wrong.
Bitcoin is now just a commodity play: it doesn't have to be rational to make money. Humans assign "value" to all sort of arbitrary things:
I get it but I’d say if you’re mad about Bitcoiners you should be a lot more angry about much of the financial industry and property speculators, two other huge groups that get rich without creating much value (or even by creating negative value).
There's a lot of value-free getting rich lately. People call it "late stage capitalism," but that frames capitalism as the villain when in fact it's a symptom of capitalism having created so much wealth we don't know what to do with it. The problem is that we're allocating it in incredibly dysfunctional ridiculous ways. I think what we're seeing is the symptoms of an early-stage post-scarcity society in denial.
The dysfunction arises from our clinging to scarcity-era puritanical ideas that only those who do a lot of work or do miraculous things "deserve" wealth. So we create all kinds of elaborate games and then convince ourselves that the winners of those games are somehow superhuman or superior in some Calvinist sense when they really just won a video game.
In a post-scarcity society baseline levels of wealth become like oxygen in the atmosphere. You don't "deserve" it. It's just there.
We are not quite post-scarcity yet, but we're close enough that craziness like $100k Bitcoin is possible. A few more key innovations will do it. Another order of magnitude drop in solar/battery prices and/or successful demonstration of a net-positive fusion power plant will do it. Embodied AIs that can do factory jobs will get us pretty far too, making the cost of manufactured goods almost equal to the cost of raw material inputs and energy inputs.
HN is unbelievably apolitical, apart from it's baseline tendency towards the left and whatever silicon valley demands people believe.
If you were anywhere near a post scarcity society (applies to USA) you wouldn't be hurtling towards national sovereign debt default at a rate of knots, and you wouldn't have the most expensive healthcare in the world.
As it happens, what appears to be a "post scarcity society" is just pathological misallocation of capital due to a political failure (that shaln't be spoken of here) that has the entire west circling the bowl at the moment.
I know of only one obvious dimension where the life standards of the average person have declined significantly since the 1970s: housing affordability. The entire developed world has a housing affordability crisis driven by cartel-like behavior among homeowners and bad zoning policy among other things. This is a policy failure resulting from bad regulation and undue influence / corruption.
Most other things have stayed largely the same or improved. Food is better and more varied, and while restaurants and some types of food have increased in cost they are still available. Health care is more expensive but also vastly better, especially when dealing with diseases like cancer or heart/circulatory issues. A cancer diagnosis is much less of a death sentence today than it was in the 1970s. Access to information is absurdly, exponentially better. Travel is probably about equally available. Communication capabilities are infinitely better. Appliances, gadgets, and other manufactured goods are significantly cheaper.
Why does the Federal Reserve US dollar have value? Because people trust other smart people who say they've done the work and trust other smart people who work for the Federal Reserve.
Money is a thing people agree upon as a medium of exchange. It is not value itself. Value is the people, places, and things that make up the actual economy. Bitcoin has no value but neither does the USD. Can't eat them. Can't build a house with them.
My problem with Bitcoin is that I don't think a hyper-deflationary currency is a good idea. Bitcoin is even more deflationary than gold due to breakage (loss of keys) and a hard mining limit.
This is what I keep telling people. No government will use BTC because of this.There is a reason the US went off the gold standard, so they can print create money without causing inflation tied to money supply. Inflation now is not tied to money supply, but to money spending. (ie. if people did not spend money buying things there would be no increase in prices.) In the past, if you printed more money inflation would be immediate since it, in effect, immediately devalues the price of gold.
BTC has value because it’s backed by a sufficiently large group with encryption.
Mechanisms which are difficult to bypass have value. You can’t eat an RSA private key but private keys have immense value.
Now there doesn’t seem to be any use case other than hoping it goes up higher, and enabling crime.
Not really.
NIST has a good blockchain explainer with a handy flowchart that has questions you should ask to see if blockchain is a useful solution:
* PNG flowchart: https://csrc.nist.gov/CSRC/media/Projects/enhanced-distribut...
* https://csrc.nist.gov/Projects/enhanced-distributed-ledger-t...
* https://www.nist.gov/blockchain
And other things are probably a better fit for the majority of people's needs.
I understand this can be just as easily done with banking system in more developed countries but blockchain is much better other parts of the world
The same can be said of gold.
It's primary modern use is jewelry, with some industrial uses (electronics, aerospace) as well as medical and dentistry. For a little while it was used as (the basis of) money, and now that particular fetish has stuck around:
* https://www.goodreads.com/book/show/249245.The_Power_of_Gold
Bitcoin and gold are now simply commodities, like oil or frozen concentrated orange juice.
Human psychology is weird.
If BTC was on the verge of realizing its purpose, Trump would work equally hard to burn it down. So, who knows if BTC price goes up or down, but categorical statements about a fundamentally transactional politician sending this permanently to the moon bake in a significant degree of risk of later being contradicted.
[1] https://www.cnn.com/2024/11/30/politics/trump-brics-currency...
That may have been the original intent of BTC's creators, but what is it actually used for now? USD and SWIFT are being used daily for transactions, whereas two-thirds of Bitcoins have been inactive for the last year:
* https://en.macromicro.me/charts/32355/bitcoin-supply-last-ac...
It's simply being hoarded.
I don't deny that a Bitcoin is worth $100,000 right now, but it could just as easily be worth $0 because at the end of the day it has zero intrinsic value.
Cryptocurrencies in general are a big pain in the ass for banks, due to how much of fraud is associated with those currencies. AML and KYC regulations have made practical use of cryptocurrencies a pain for both parties, for the past 10 years. It's just now, in the very recent years, that it has become somewhat easier and streamlined.
[citation needed]
In what units? What makes you think there won't be Argentina-style inflation of the USD?
1) A very high (BTC/USD) rate will come from HUGE whales hoarding BTC. Like governments creating crypto reserves, and purchasing BTC in the magnitude of tens of thousands to low million (US have talked about purchasing a million).
2) BTC will never be a currency that is used for huge worldwide transactions, for things commodities like oil, gas, etc. No serious country will give up control of their currency like that, especially not US that will literally go to war if things aren’t purchased in the Uas dollar
3) Likewise, countries will not adapt BTC as their currency, if they cannot control the supply 100%
4) If BTC becomes too competitive, it will be fairly easy to regulate it into being too unattractive.
Those are my macro views.
I think it will continue to be some asset that competes against silver, gold, etc.
Will it though? There are millions of US voters who hold crypto and both sides attempted to appeal to this voting block in the last election (obviously one with more success than the other). Heavily regulating crypto seems to offer massive political downsides with very little potential gain.
And we haven't even seen the crypto version of the NRA yet.
USD losing the world's reserve currency status and:
1. Yuan becomes the reserve currency
2. BTC becomes the reserve currency
they would understand that choice 2 is preferrable for the West
There is a reason the US and other governments went off of the gold standard, and that is so we could control the price of our currency, which is what led to te mess we are in now.
If BTC were controlled by the government it would be no different than the dollar when we were on the gold standard, and that it why it will never be a currency.
Who trusts China enough to sign on board with them to do this?
> 2. BTC becomes the reserve currency
Given what we know of history, why would anyone go towards a new (digital) gold standard? It's a bad system:
* https://archive.is/https://www.theatlantic.com/business/arch...
* https://www.goodreads.com/book/show/775143.Golden_Fetters
that limits monetary and fiscal flexibility and helped usher in and prolong the Great Depression.
just wanted to note that they are using a 20-year history window as an argument, while the gold standard existed for about 3500 years before that, across very different cultures.
The troubles with a fixed monetary supply existed much earlier than that, having historically recorded issues going back almost five hundred years:
* https://en.wikipedia.org/wiki/Great_Bullion_Famine
We call the thing in the 1930s the "Great Depression", but before it occurred there was another time period that held that label, which has since been renamed:
* https://en.wikipedia.org/wiki/Long_Depression
It's just most folks accepted that this is how things were "supposed" to be because they didn't know any better, but there was great dissatisfaction on how things were:
* https://en.wikipedia.org/wiki/Cross_of_Gold_speech
It took until the likes of Irving Fischer, Keynes, and FDR until the old habits could be thrown off (too late in some places, like Nazi Germany and Imperial Japan):
* https://www.goodreads.com/book/show/24945314-the-money-maker...
> […] while the gold standard existed for about 3500 years before that, across very different cultures.
It did not. For most people, most of the time, it was credit that was used in day-to-day life:
* https://en.wikipedia.org/wiki/Debt:_The_First_5,000_Years
And even the rich often forsook coins:
* https://en.wikipedia.org/wiki/Negotiable_instrument#History
* https://centaur.reading.ac.uk/30672/1/12%20Chapter%201839%20...
They earliest records of monetary transactions used credit:
* https://www.sfu.ca/~poitras/jesho_UR_14.pdf
* https://en.wikipedia.org/wiki/Third_Dynasty_of_Ur
* https://www.goodreads.com/book/show/36854772-the-open-sea
Where gold was perhaps around, most folks were too poor to deal with it. And in a lot of cultures gold was not used at all:
* https://www.goodreads.com/book/show/50358103-money
The use of gold was mostly concentrated around the Mediterranean.
* https://www.goodreads.com/book/show/249245.The_Power_of_Gold
The Chinese used silver (as the Spanish learned post-1492). The Incas had gold (as the Spanish happily learned) but not for currency (of which they had none) but for ornament/jewelry. Other cultures simply used other things, like non-shiny rocks:
* https://en.wikipedia.org/wiki/Rai_stones
It is actually the gold standard—the convertibility between paper money and shiny rocks—that is the historic anomaly, existing between (depending on how you count things) between one and two hundred years:
* https://en.wikipedia.org/wiki/Gold_standard
Even the very meaning and nature of what is meant by "money" has changed over the millennia, starting with Aristotle and continuing to the present day:
* https://www.goodreads.com/book/show/58933308-the-currency-of...
OTOH, government crackdowns might be able to tank the price.
Bitcoin is no more an inflation hedge than gold is, which it is not:
* https://www.nber.org/papers/w18706
* https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3667789
and both are something worse, deflationary:
* https://www.nber.org/books-and-chapters/financial-markets-an...
* https://www.goodreads.com/book/show/775143.Golden_Fetters
Gold did not help in stabilizing currencies or economies:
* https://archive.is/https://www.theatlantic.com/business/arch...
and neither would Bitcoin.
At least, Bitcoin can't be printed and not centralized like a government-controlled money.
Bitcoin is not perfect, also not fully decentralized either, but still much better than more-centralized fiat which are government-controlled and are still used for all the harmful purposes already.