You are sorely underestimating those two arguments. you are too far gone to think other people don’t have this sort of conviction. you are no better than the typical doomsday prepper. Reminds me of how developers and people who write code cant fathom why users do certain actions in a software. They forget how basic and dumb an average human being is. So far BTC has failed to convince an average person that BTC is the next Jesus. and until that happens you can scream all about scarcity…it ain’t going anywhere.
So useful? It’s just circular logic…. No I’m not. You are just upset because the things you keep saying aren’t happening in any meaningful way. Renewable energy is still vastly overwhelmingly in fiat. Currencies are still in fiat. There are plenty of asset classes to maintain and build wealth. What’s the big deal with BTC again? Hype hype hype hype. Nothing last forever and change is constant. Poorly. You claiming so doesn’t make it true.
bitcoin has been the best performing asset for its entire existance, but also ' it aint going anywhere'
I won't deny fiat has it's issues...... everything has pros and cons (even BTC). But it's no coincidence that the majority of growth came under fiat. It's also odd that BTC isn't taking off during this period of higher inflation. Like what does it react to?
Growth comes from credit expansion. Too much or too fast of expansion leads to wreckless lending and investing. Credit expansion and retraction is more about previous vs current credit rates, not so much about the actual rate. Credit contraction leads to recessions, which is not necessarily bad. Fiat allows for easier minatary controls. I'm not necessarily anti-fiat per say, but when you have a dozen or so people controlling the global monetary system, it is never good. Sometimes I think people do not understand that when the US policy makers make the slightest changes, it effects everyone on this planet, not just Americans. And the further the person is from direct source of the money, the harsher the effect. It's important to understand the cantillon effect. Bitcoin can fix this.
That's the question the speculators are focused on. Right now it looks like the most obvious and consistent factors are: -money printer -big 3rd party scandals -court decisions
If you run things to scale over time, everything will coalesce into exchanges, both official/unofficial. Central banks have stored gold as a symbol of credibility, but the supply of gold does not outpace investor demand, so you have derivatives of gold and its proxies. On the "unofficial" level of exchanges, defi exchanges has proven to be more a wildcat bank-like scam than a utopian "liquidity pool for the unbanked". There are hacks, rug pulls, and token dilution that represent the ugliest examples of banking/investing. Some might see it as a deflect away from Bitcoin, but Bitcoin can't solve that by itself either. There's also a belief structure in Bitcoin that convinces Evangelists that it's the One and True Digital Currency, or depending on said person's belief Bitcoin is Zeus in the Pantheon of digital currencies. Predicting tech is never certain and even Silicon Valley execs cook up a bit of sci-fi to achieve goals to investors and their employees. The "hard asset" is the belief structure that keeps those miners running for a better payday. Yeah, I was going to add something similar to the responses since Donny admitted the story/utility changes over time. I might but this thread-chain is getting gnarly.
Spoilered because it's a lot of words Spoiler If the nodes shrink too much because of razor thin profits, then claims of btc being hack-proof weaken as well. Miners coalescing into state protected utilities and/or corporate consortiums runs a big risk against the decentralization philosophy of bitcoin. Individual miners are fighting against Moore's Law, so it makes no sense for me to invest if BTC is worldwide, but it could still be worth buying a $2000 graphics card/machine with a "shelf-life" of 2-5 years if BTC is down in the dumps. How can you ask anyone to trust Layer-2 tech with the same fervor as Satoshi's bitcoin? Layer-1 improvements/promotion would mean a hard fork by adding several new amendments to the Constitution, right? I never heard of dividing satoshis even further (not in whitepaper), so I let my imagination run with it. In the current trad-fi system, local banks and governments (through central banks) control the money supply. Local banks impact this by fractional lending to retail customers or local businesses and are more attuned with the health of the region. Governments trend towards centralizing that power in order to control and plan every aspect of the money supply (they can't). We don't know what BTC's endgame for lending is. Honestly, I haven't researched that far because fractional lending has been the way of life. I think some Muslim banks have dabbled without usury, but I haven't looked into it. There are problems with excessive printing and macro-level distortions when governments tip the scales too much, but the liquidity they provided also sparked booms globally. China used that massive influx of dollars to build multi-million people cities that didn't exist 20-30 years ago. I think the deflationary aspect of bitcoin disqualifies it as a currency reserve. Even if there is a reset and btc is equally distributed, it assumes that wealth/value generation is zero sum. Countries like South Korea, Indonesia, Vietnam, or China would not have rapidly grown because Bitcoin increases the risk profile and barriers for lending. How does "the Global South" grow with a deflationary reserve currency if they require investment abroad? The whole bit about remittances only works when BTC is in the early "0" phases (h/t @Space Ghost)). When it's "1", the expectations and demands are on a different level of scale and scope. I'm mostly arguing when BTC is at the "0" speculative phase. When it hits "1"....sounds great for Michael Saylor, the JP Morgan of our times. You sound like a purist, yet understand BTC's flaws enough to be hopeful for Layer-2 solutions. In other crypto currencies, that's one of many vectors to attack for vulnerabilities. Lightning's code has been far less scrutinized in comparison to Bitcoin. For one, it's been in development for a while, and two, Bitcoin is doing what is claims to do while Lightning has not. If Lightning fails because of buggy code, irreversible "BTC hard fork worthy" exploit, hacks and/or random disaster, do we pin our hopes on a "future tech" that addresses the Trilemma and wash Bitcoin of the nasty destruction in wealth and consumer confidence? Bitcoin is only guilty by association... You're promising me future enhancements for a tech that hasn't worked at scale out of the box. We already tried daily transactions years ago, and it was slow and inconvenient for daily purchases. That guy who sold 10k bitcoin for a pizza is now a legendary fable, but it also helps discourage people from actually using it like a currency at scale. I suppose you're not a bitcoin purist, but more of an ala carte believer. There are folks who believe bitcoin should never hard fork again out of principle, though everyone's wallet would love it because even "old-classic" bitcoin acts as a dividend. You're building more of a hydrogen car and promising the benefits hydrogen fuel cells bring. Right now, we mostly convert fossil fuels into a methane intermediary and finally into hydrogen fuel. There's also some questions of viability now that governments are supporting electric with fervor. Money is far different though. Credit is a basis of faith. I get the USD is at a critical inflection point, but I still have doubts about the current iteration of Bitcoin's endgame.
Miners: I haven't fully grasped a game theory once most of the bitcoin has been mined. What I do know is that it must be viewed as an energy expenditure in relation to global consumption and demand, not so much hardware. I believe in the idea that bitcoin is spent and stored energy. This is why I stated fusion would eliminate bitcoin. As long as the Bitcoin network consumes enough energy to prevent a 51% attack, we are ok, regardless of price. I also believe there is immense value in the Bitcoin network as a security protocol vs the actual bitcoins found on the ledger. For example, a security action (lets be super hypothetical here) like the launch of a nuclear weapon could be tied to a bitcoin address with a value >0. If that bitcoin address switches to 0 (spent), then it would perform the launch. Think of a digital unhackable key. Yes, using the network to launch nukes is far fetch, but the point is that it is secure enough to perform the task. Layer 2 and sub-sats: Anything not on main chain is subjected to tampering. It all depends on the risk an entity wants to take. I dont think anyone is too concerned about their $3 duncan donut coffee charge performed off chain. The layer-2 liquidity pools are certainly at risk at this point. Intuitional control of bitcoin: Im ok with large intuitions having large sums bitcoin. At the end of the day, they will be forced to buy and sell to the highest bidder. MicroStrategy is highly leveraged. The bitcoin belongs to the investors, not Saylor. If bitcoin truly becomes a "1", then its value will not continue to go up at such a high rate. It will become the nominal value. Bitcoiners need to be honest with themselves. They hold it as a speculative asset. The moment they are convinced its not going to continue to go up at high rates, most of them will let that capital flow into more productive means. That is essentially what money should do anyways. Cantillon effect: I keep using this term. Its important for Bitcoiners to understand it. If the 6 continents each had a regional share of bitcoin and each could launch a fiat currency backed by bitcoin, it would vastly change global economics. Taxes could be used to continue to buy bitcoin thus strengthening their fiat, or sell it off for the opposite effect. Either way, credit expansion would help more people directly. View fiat as nothing more than an avenue to leverage credit against bitcoin. In this hypothetical situation, If Im a small business owner in Africa, I get a much better lending term if I am borrowing African Dollar that is directly backed by bitcoin than I would ever get if I was borrowing in the current system, which is essentially issued by the IMF, which is backed by the USD. What most people dont understand is that most of these 3rd world countries debts are paid back in nominal USD while their governments debase their currency at a rapid pace. Americans get the luxury and privilege of their debt getting debased at the same rate as their currency.
Tough call TBH. Bitcoin aside, commodities are hard money but its hard to have a commodity based credit system (thus why gold failed) Austrians are commodity based ideology Keynesians are ledger based ideology bitcoin (₿) is a commodity Bitcoin (the network) is a ledger. (insert WhyNotBoth meme)
@dmoneybangbang and @Invisible Fan - i appreciate the great feedback. I know donny doesn't think anyone is providing any valid arguments but I am learning from yall and yall are articulating my concerns much better than I would have.
Yeah, that is what trips many people up. Bitcoin being both a commodity and a ledger all at once. That's a completely novel thing that nothing else had achieved. Not only that, its the best iteration of both in history so far. A commodity that is eternal, portable, fungible, verifiable, truly scarce and infinitely divisible... And a ledger that is diffuse and efficient but also the most secure, powerful network that has ever existed.
Satoshi put such a long-tail on the mining for exactly for this reason -- BTC needed a long enough runway for the network to mature to the point that the post-mining world would not see any kind of disruption. If the mining rewards stopped too soon or abruptly, then yeah, you'd have a huge dip in network participation and it would open the network to an attack, but given that this scenario is over 100 years away, the off-ramp is quite comfortably long and sufficiently gradual with the halving schedule. Nobody can predict the future with 100% certainty, but I feel confident enough that given current adoption trends this will not be an issue by the end of our lifetimes, let alone long after we're all dead. The longer BTC goes on the lower the coalescent risk is. I'd say by this point it's impossible given the amount of computing power required to highjack the network. This risk was there years ago (block size war is a great example), but it's gone now. That's the beauty of decentralization. It gets voted on by the entire world. Only the best, most sound features are added. Correct. I do not support layer 1 changes and at this point they are virtually impossible to achieve anyway. Anything need explaining there? It's fairly straight forward, but very important. We wouldn't bump into a supply problem with BTC for a very, very long time, but the fact that you can layer additional divisions into it is a nice feature once we hit that point. Also note that this does not appear in the white paper because you cannot program infinite division, each 'division' layer would be finite, and would eventually need to be replaced/superseceded... but the sun may explode before we hit that point. Lending/credit will always be with us. Bitcoin will just make the practice more stable and prudent. Bitcoin is halal, but if you charge interest that's up to you, not Bitcoin itself. I do not believe there is any amount of good that can be done by or with fiat that is not wholly erased or surpassed by the amount of harm fiat visits upon society. It's an inferior asset and currency whose time is ending, and not a moment too soon. How? This is not happening, but more importantly, why would you want this? The opposite is true. Bitcoin is the least risky asset on the planet. Volatile yes, risky no. Also, considering Bitcoin is the only bank in existence with zero barriers to entry, I'd say it opens up more doors. I do not understand this statement. Remittances function much better with BTC regardless of when. That's life for you. Novel things go through price discovery as its value gets understood better and better. Those vectors exist when a currency is centralized. Bitcoin is not centralized. Lightning is doing what it claims to do. I use it all the time. Again, faulty layers are weeded out through natural selection. This is why decentralization is so important. This is criticism in the "why no utopia already?" vein. Refer back to my car/internet example. You cannot expect something to become the entire world's value measuring stick and method of exchange in less than 15 years. Bitcoin is working just fine, continuing to grow and thrive and on a trajectory to capture a very large percentage of the world's wealth. I am a maximalist/purist. Layer 1 should never be ****ed with because it doesn't need to be ****ed with. Any enhancements can happily rest on top of layer 1. Whatever analogy you want to use is fine, the point is that the technology is inevitable because markets select for the best product and bitcoin is the best product. The same reasons we selected gold as our SOV/currency for thousands of years is the same reasons we will choose bitcoin. Like I said, I don't think you need to worry about Bitcoin's 'endgame' vis-a-vis credit.
