Bitcoin

[*zap*]

They are losing control not by choice but by one legal battle and political blunder after another. It'll be death by 1000 cuts by the time they fully lose control. They started losing control in 1971.

The US military backs them. It may be awhile.....

 

[Craig4791]

I think the risk is at least two orders of magnitude higher than what the market has priced in.

You absolutely can quantify risk. Hell that’s what risk managers in financial institutions do. Elsewhere as well.

If you think Bitcoin is 20X overpriced you should absolutely start developing a short position! Would be a great investment for anyone but especially a fella like yourself since you have so much money you'd never be able to spend it all.

 

[Craig4791]

The US military backs them. It may be awhile.....

The military requires them to print more and more every year to defend it.... Self propelling in nature!

 

[Dos Perros]

If you think Bitcoin is 20X overpriced you should absolutely start developing a short position! Would be a great investment for anyone but especially a fella like yourself since you have so much money you'd never be able to spend it all.

Two orders of magnitude is not 20x lol.

 

[Craig4791]

Two orders of magnitude is not 20x lol.

Yep you got me! Brain glitch and fast typing im guilty as charged.

Trade is even better than I typed! Send it!

 

[Dos Perros]

Yep you got me! Brain glitch and fast typing im guilty as charged.

Trade is even better than I typed! Send it!

For funsies, how does one ‘short’ a cryptocurrency with assurances you’d get paid when it went to zero? I’m thinking in that scenario most people get nothing.

 

[Craig4791]

For funsies, how does one ‘short’ a cryptocurrency with assurances you’d get paid when it went to zero? I’m thinking in that scenario most people get nothing.

Perpetual futures contracts would allow you to do it without having to pick a time to maturity date. Derivative markets are mostly all zero sum so if you’re making money someone is losing it.

The risk in the scenario it goes to zero is the broker your trading the contracts with imo… Which is no different than any broker going tits up but to be fair they are pretty good at hedging everything in the derivative markets. If you recall Oil contracts traded negative for a bit during Covid. History is full of hedge funds blowing up putting on big derivative trades with leverage.

If your convicted in your assessment it’s an opportunity but your also just naturally short by not owning it so I’d probably recommend doing nothing.

 

[Stave]

Bitcoin absolutely has a price floor because it requires energy

The labor theory of value is false. Doing work doesn't make products valuable.

The energy theory of value is also false. Inputting energy does not make something valuable.

Paying a light bill is not what makes light in a home valuable.

The huge expense of powering the internet is not what makes the internet valuable.

Electricity is an expense for which electric grids, the internet and Blockchain networks have to pay.

If everything you desire to purchase is declining in value in Bitcoin terms then there is in fact a risk to not owning it.

If it is true that not owning btc is a risk, BTC is a threat to the life savings of everyone on earth. Is that what you are saying?

I am saying BTC competes with other currencies like the dollar and the euro (If a person's life savings is in the dollar, they should be very concerned). BTC doesn't compete with things that have value like labor, skills, real estate, companies, commodities, etc. Therefore, people shouldn't be worried BTC is a threat to their 401k or property value. That is what I mean when I say people shouldn't be worried about BTC impoverishing them if they don't buy it.

So then why worry about what the STATES definition of money is

Not sure what you are referring to

 

[FishfinderAK]

Holy smokes!
I haven’t been paying attention for the past year. About 3 years ago I educated myself on blockchain and ended up purchasing 4 ETH coins.
I had since mostly forgotten about and quit daily checking my Coinbase account. Until someone at work mentioned crypto is banging again.
Unfortunately, I’ve also mostly forgotten all I learned 3 years ago.

IYHO is it a bad time to get back in? Always hard to avoid the temptation during a bull… but…is it just the beginning of the bull?

 

[fmyth]

Holy smokes!
I haven’t been paying attention for the past year. About 3 years ago I educated myself on blockchain and ended up purchasing 4 ETH coins.
I had since mostly forgotten about and quit daily checking my Coinbase account. Until someone at work mentioned crypto is banging again.
Unfortunately, I’ve also mostly forgotten all I learned 3 years ago.

IYHO is it a bad time to get back in? Always hard to avoid the temptation during a bull… but…is it just the beginning of the bull?

In past cycles a bull run has begun approximately 6 months after the BTC halving and have lasted 18 months. The halving is less than 30 days away. I think you are early. Larry Fink wants an ETH ETF.

 

[Danny Hoey]

What I don't really understand is, and I haven't found an answer to, is what happens when all the bitcoins are mined? There is no more value in the "miners", the energy used in mining is not needed. Will the race be over? Will people lose interest?

Bitcoin for me is nothing more than a vehicle to make money. I don't plan on actually using it for anything other than that.

Some of the ether projects I can kind of understand, there is a use and product.

 

[fmyth]

What I don't really understand is, and I haven't found an answer to, is what happens when all the bitcoins are mined? There is no more value in the "miners", the energy used in mining is not needed. Will the race be over? Will people lose interest?

Bitcoin for me is nothing more than a vehicle to make money. I don't plan on actually using it for anything other than that.

Some of the ether projects I can kind of understand, there is a use and product.

In approx 116 years all 21 million bitcoin will be mined and the network will no longer produce new bitcoin. The block subsidy will go to zero but miners will continue to receive transaction fees.

 

[Stave]

IYHO is it a bad time to get back in?

In the short term (months), it is impossible to say whether prices will rally or crash.

In the medium term (years), due to people's confidence/sentiment/hope/greed/distrust of govt currencies, imo crypto prices are 90% likely to go higher

The best way to get in right now is dollar cost averaging. If the price falls, stick with the plan.

 

[Mighty Mouse]

What I don't really understand is, and I haven't found an answer to, is what happens when all the bitcoins are mined? There is no more value in the "miners", the energy used in mining is not needed. Will the race be over? Will people lose interest?

Bitcoin for me is nothing more than a vehicle to make money. I don't plan on actually using it for anything other than that.

Some of the ether projects I can kind of understand, there is a use and product.

The assumption is that mining will continue because mining is necessary to add blocks to the blockchain and record new transactions. As the mining reward decreases, miners will depend more on transaction fees for revenue and less on the reward. The halving schedule is public knowledge and the reward will stay above 1 satoshi for another century, so the Bitcoin community can see this coming and will have ample time to prepare for it. If the supply cap/halving protocol were to become a real problem in the future, the protocol could be altered or Bitcoin could fork into capped and non-capped versions.

 

[eddielasvegas]

If you can't hold it, you don't own it.

That's what I can't quite get past as I think about BTC, you are still dependent on "The Man." You know electricity, the Internet, etc., etc., etc.

I can hold Au (or Ag or food or ammo or even soon-to-be-worthless fiat currency) ) in my hands and the only way somebody can take it if if they pry my cold dead hands off it.


Eddie

 

[2531usmc]

In approx 116 years all 21 million bitcoin will be mined and the network will no longer produce new bitcoin. The block subsidy will go to zero but miners will continue to receive transaction fees.

Ok, in 116 years all 21 million bitcoined will be mined.

But what about all of the other cryptocurrencies out there: ethereum, tether, BNB, solana, XRP, USD coin, cardamom, avalanche, dodge coin, Shiba Inu, toncoin, etc, etc, etc.

One small change to the software algorithm and you now have a new currency. What makes one different from another? If bitcoin reaches new highs, what prevents the cryptocurrency community from leaving bitcoin and transitioning to etherereum or toncoin?

These are all basically the same…..right? The only difference is the tweaks in the algorithm?

 

[Danny Hoey]

In approx 116 years all 21 million bitcoin will be mined and the network will no longer produce new bitcoin. The block subsidy will go to zero but miners will continue to receive transaction fees.

I'm not talking literally all the bitcoin. Just to the halving point where it's not worth the energy for the "mining" companies. It's all good when people are being hopeful that their reward will be worth x dollars, but people will lose interest and the price people will pay for 1 bitcoin will go down. At what point do the miners fold, and the pyramid collapses?

I don't think that will happen soon btw. Too much noise around it right now, but I feel that it's inevitable.

 

[The_Dinkmaster]

There is no risk in not adopting bitcoin. If you walk into a grocery store someday and they only take bitcoin, it is because the price of bitcoin has become more stable than other currencies, with a smaller spread, more liquidity and a predictable price.

At that point, you take whatever assets you have (skills, labor, stocks, income, real estate, commodities) convert into a little bit of BTC and buy your groceries. Nothing to worry about. You will only need enough to pay your monthly bills.

But your grocer of course will be submitting sales tax to the govt in BTC. That is one way they will know whose wallet is whose.

BTC will never be used as a currency. Its essentially a version of digital gold...and we have been off the gold standard a while.

Eventually, the government will go cashless and we will all have a digital only currency (look up FedCoin) and the USD will be no more.

Obviously, this isnt a good thing. The question then is will the USgov consider other cryptos that are not considered commodities (pretty much everything but BTC and ETH) be outlawed as counterfeit currencies? If so, people who own those will kinda be screwed. And that IMO is the biggest risk in crypto.

 

[Mighty Mouse]

I'm not talking literally all the bitcoin. Just to the halving point where it's not worth the energy for the "mining" companies. It's all good when people are being hopeful that their reward will be worth x dollars, but people will lose interest and the price people will pay for 1 bitcoin will go down. At what point do the miners fold, and the pyramid collapses?

I don't think that will happen soon btw. Too much noise around it right now, but I feel that it's inevitable.

Disregarding transaction fees (which also incentivize mining and will likely constitute an increasing portion of miners' revenue as rewards decrease): when the value of bitcoin falls, marginal miners become unprofitable and quit mining it (or switch to mining something else), which causes the total Bitcoin network hashrate (the total computing power devoted to the network) to decline, which causes block times to get slower, which triggers a (downward) difficulty adjustment to speed block times back up to the 10 minute target, which makes it easier/cheaper (in terms of computational power) to mine bitcoin, which encourages marginal miners to resume mining. When the marginal miners return, total hashrate increases, which speeds up block times and triggers an upward difficulty adjustment, and the cycle continues. The protocol has built-in regulating mechanisms to encourage continued mining despite fluctuations in the relative value of bitcoin.

 

[2531usmc]

I'm not talking literally all the bitcoin. Just to the halving point where it's not worth the energy for the "mining" companies. It's all good when people are being hopeful that their reward will be worth x dollars, but people will lose interest and the price people will pay for 1 bitcoin will go down. At what point do the miners fold, and the pyramid collapses?

I don't think that will happen soon btw. Too much noise around it right now, but I feel that it's inevitable.

I think you’re right Danny. At a certain point, people will lose interest, the price declines, and the pyramid collapses.

Wall Street is creating the noise and excitement pulling in the retail investors looking to striking it ritch. They will be selling at the top while consumers pump money into the system. If retail investors hold for the “long term”, the insiders walk away with all of it and the retail investors are left with nothing.

At least to me, it looks like the crypto version of the classic pump and dump boiler room scam.