Topic: Can you help me refute a contrarian? - page 2. (Read 2992 times)

That's a good example but I remember the ratio was 20% vs 80%. To bring more examples,
20% of men fuck 80% of women.
20% of women fuck 80% of men.
20% of programmers write 80% of code.

That is insanely optimistic. 10% of any commodity market, including shares, being dumped at one time would crash the price to 10% of the value, that is more like it So no, you can't just sell half of all bitcoins for 1.4 billion total, it just won't happen - 140 million, if you are very lucky.

Yes, dollar distribution is far from meritocracy. But you call "ugly" not dollar, but bitcoin distribution. Are you suspecting that Satoshi inherited his coins from his rich dad? Do you think Ulbricht got his coins because his mom had right connections? No, you are not and you don't. But you still call this distribution, which is as close to meritocracy as humanly possibly, "ugly". Therefore the "mumsy and dadsy" is not the reason for your indignation. It is just pretext.

Why do you need pretexts? Why don't you give us (and yourself) your real reasons? Why would anybody hide his real reasons even from himself? Probably because the reasons are ugly. For example, you may feel entitled to other people's money. Are you? You are not brave enough to rob people, so you would delegate the robbery, along with the risk, to state, while you would just vote for right robber.  And you would prefer to think of yourself as of honest person, rather than as of robber, so you are in search of an ideology that would repaint the robbery as an honest and even noble occupation. So comes "liberalism", i.e. socialism. And vuala! You are not robber, you are noble person! You take not for yourself, but only for the poor underprivileged kids! For just a bit more equality! You are fighting for the impossible dream! You are practically saint! And your opponents are practically devils.

Don't you see how hypocritical it is?

You are working for "a bit more equality". How much more do you want? Exactly? The fighters for "just more equality" started from 1% tax, and since then were pushing and pushing and pushing for "a little more". Now they are taking and redistributing about half of GNP, half of all what people of the whole country produce, and what? You dismiss it as it's nothing and ask for "little more". Do you people have any sense of shame? You are taking from people half of everything and you are still not satiated! You still demand "a little more"! You won't stop until you get everything. And when you'll get everything, the world economy will collapse. The collapse of the Soviet Union is nothing compared with it, because Russians had West to flee to and to receive help from. But when the world economy will collapse under your weight, whom would you ask for help, for "a bit more"? Where would you flee to? Nowhere to.

Don't you see how dangerous it is?

It's for protection from such well-meaning re-distributors bitcoin was created. Hopefully, it still has several years to mature and save the world from the catastrophe you are preparing for all of us.

(Nothing personal, I've no doubts that you personally are noble, altruistic and well-meaning guy. Which makes things even worse, since egoistic bastards can at least be held at bay by threat of punishment, while altruistic ones would happily sacrifice themselves for their noble world-destroying cause).

Exactly.  Which is why it would be hard to find studies that modeled this type of behavior.  I'd guess that if you found the closest analog in the stock market casino to the order imbalance caused by sell orders on 50% of the float, you'd probably see continuing price degradation.  That would probably be a result of a big change in fundamentals...probably re-stating earnings or something similarly dastardly. 

This situation would be different enough that there just aren't any similar cases, so it's hard to say what would happen.  Sorry I wasn't very clear.

But in the situation you described, there was not a change in fundamentals, only an overvaluation in the estimation of a few large holders that was corrected for through selling.

1 person or 0.000000001% of the global population owns 29% of Facebook. Facebook is used by BILLIONS of people..OMG. Why wouldn't anyone want to use Facebook if 1 person controls 29% of it

Distribution would likely improve, yes.  I think we could probably guess endlessly about the long term effects of the price.  Some would argue, persuasively, even, that the effect on price could be substantial and lengthy.  This isn't exactly like stocks that have underlying inherent assets and cash flows of which one is buying shares. I think it would be hard to find many examples of stocks with no underlying fundamental changes that had sell orders on 50% of the float, so when it happens, it's due to fundamentals and the impact is likely to be long-lasting.  This might be different.

bitcoin goes to those who value it. Anyone who wants some is free to purchase as much as they want. We started at 1, then 2, then 5, 100, 1000, 1,000,0000

as the user base and value grows the coins get distributed. 

Well, reasonable people could certainly agree to disagree on this, so I'm absolutely not trying to say that I'm right and you're wrong.

But I would say that wealth distribution is clearly not a meritocracy in the way that athletic competitions are.  Especially for the 0.6%, it is far more correlated to your "choice" of who your dear old mumsy and dadsy are.

And I agree with you regarding equality, but I think a little more equality of opportunity is worth working towards.  Impossible dream, I know, but it works as a concept.  

Creating wealth takes great talent, as does writing bestsellers, making scientific discoveries, and holding athletic records.  I would absolutely flat out NOT include maintaining wealth in that category.  It's not nothin', but it's also not nearly so active of a pursuit as anything else you mentioned.  Just MHO.

It would impact BTC pricing, in the short term, once.  Then the 1000 sellers would have sold their btc to 10,000 buyers and the distribution would improve.

Your reasoning is good, and I'm not trying to argue, but there are other possibilities. 

They might be true believers.  They might just be "rational actors" as they say in the case studies.  

In a classic prisoner's dilemma, the "prisoners" (in this case, the 1000) could theoretically decide not to betray each other (in this case, sell BTC) for their mutual benefit.  But as the rewards for "betraying" (in this case, selling) get greater, a prisoner might decide to pursue his own benefit.

Obviously, this is quick and dirty, but look at it this way:
12MM BTC at 650 means 7,800,000,000 in total value
50% of that is 3,900,000,000
divided by 1000 holders is 3,900,000 each in value held.  Subtract out Satoshi's share and it's more like 3,575,000 for the other 999.
With 50% on the market, the selling pressure would be immense.  I looked at a number of models analyzing float manipulation, order imbalance, and the impact on stock prices.  If I read the models correctly, 50% of the shares on the market would likely cause MORE than a 50% drop in price, but even at a mere, say, 60% (and I think it would be higher),
So for the 999, with a price of 650, under price pressure from selling their shares, you're probably talking about maybe $1.4 million for each if they all cashed out now.  That is IF the 999 are more or less together on this.  And that's even assuming equal distribution among the 999, which isn't likely.  For most of them, it is likely less.  

So, you're absolutely correct when you say that their best move right now is HODLing their BTC and growing the total value...likely by growing the adoption rate and infrastructure.  And keep in mind, if they are doing it because they are believers or because they are just waiting to cash out, it all looks the same to you and me.  I mean, if it's worth $1.4 mil or maybe less to me now, that's pretty good, but I'm not ratting out my other prisoners.  And no way would I even consider "voting" for a mass liquidation by the 999 if I'm one of them.  I'm not sure I could even retire on that right now--damn sure couldn't if I'm in the bottom half of the 999.  It might be close, but vuduchyld ain't tryin' to outlive his money.  

What if BTC is $3250, though?  Now I'm probably up over $5mm in a pressured market and $10mm in an unpressured market.  Might be a little more pressure on some "prisoners" at that point.  What about BTC at $10,000?  Somewhere between $30mm and $60mm?  That is getting close to buy-an-island money.  

Again, I'm not saying they aren't true believers, but if they aren't, and if it's just the "greater fool" theory, this distribution could definitely impact BTC pricing.  As long as they think there are greater fools to buy in at higher prices (obviously true right now), you continue to maximize value.  But frankly, we've got people on this board who seem to think their 1 BTC is going to make them a dollar millionaire someday.  If you are one of the 1000 who have an average of SIX THOUSAND BTC right now, would you settle for $1.4MM?  

Actually 0.00001% of the population owns 90% of the world's wealth, they are just well hidden, through indirect holding thousands of companies. The Rothschild family alone owns about 50 trillion of wealth.

Is it ugly that 36% of world records are made by 0.6% of athletes? (Real numbers may differ, but the principle stays).
Is it ugly that 36% of bestsellers are written by 0.6% of writers?
Is it ugly that 36% of greatest scientific discoveries are made by 0.6% of scientists?

Creating and maintaining wealth requires talents, just as sport or art or science. And distribution of talents in this area is just an uneven as it is in all other areas. Because of this if you let people keep wealth they created, some people will be much richer that others. You have to choose - you want freedom or equality. If you looking for equality, bitcoinland is not the place to look for it. Because bitcoin is all about letting people keep their money.

This. We shouldn't treat addresses as individuals. Multiple addresses can belong to one person, or several individuals may stand behind just one address.
And boy, do we have plenty of addresses .

I'm familiar with prisoners' dilemma but I don't see how it applies in this case. I venture to guess that most early investors are strong believers in the technology behind bitcoin, and believe it is not a self-limited bubble -- otherwise, why invest in it? It would be too risky. They do not see bitcoin investors (or users) as a bunch of fools and do not envision some inevitable time when all the fools are going to jump ship. Bitcoin (or crypto in general) is a technology that has inherent uses that persist even if its value as a currency is zero. (There are a myriad of examples -- smart property, colored coins, voting systems, identification systems, proof of copyright, many more I have never even thought of). People pay money for other pieces of software because they are useful tools. Bitcoin is the same.

Suppose you owned 25% of all coins right now, personally. And suppose you were very persuasive and had the ears of the other ~1000 and together, you owned 50%. What conspiracy could you possibly dream up that would make you more money than HODLing some of your bitcoin, and growing the bitcoin ecosystem with the rest? That's exactly what a lot of the big investors are doing. (For the sake of argument, let's exclude from consideration buying an army and marching on everybody -- or buying a politician, which in my mind fits into the same category. IOW, let's exlude business as usual under the existing fiat system.)

As the price of bitcoin rises the holders of a lot of bitcoin will have an incentive to sell their bitcoin which will cause bitcoin to be more widely held.

It should also be noted that these numbers are distorted by Satochi's estimated 1 million bitcoin. If you were to back out these coins then bitcoin would show as being more distributed.

gentlemand, thanks for the links!  The zombie link was fascinating.  Will read more in depth later and will also forward in my reply.

Peter R, great info.  One thing that immediately comes to mind is that in the T/M formula, I'm wondering if the mining counts as a T.  Just intuitively, I would suspect that BTC would have a much lower velocity than most currencies, but obviously, I could be completely wrong.  Definitely will do some further research and this helps.

ghdp, are you referring to rpitiella, who started the thread referenced by gentlemand?  That's my guess.

watchwoord and ThatDGuy, I'm so on board with what you're saying.  It's part of the appeal of BTC, for sure.  But I'm not sure the non-BTC community actually is less symmetrical at the top.  If 0.6% own 36% of the wealth, that's ugly, but we're talking about a similar number, 29%, possibly being owned by  0.03% of the BTC community, which is about 20 times more concentrated.  That, of course, may or may not be accurate, given some of the other info above.  Moving down, 43% of the wealth is owned by around 8% of the population (round numbers).  50% of BTC is owned by still a lot less than 1% of the BTC world.  I will definitely go back and read that entire thread, though, because there may be something I missed.

piramida, I actually agree with what you're saying, at least in theory, and at least to some degree.  That's why I hold some BTC.  

BTCTrader71, I don't suspect they would conspire to destroy the market, but there is a prisoners' dilemma type of issue.  At what point IS it worth it to them because the rewards are so great?  One could say they are relying on a "greater fool" theory.  So far it's working.  At some point, their calculus could change, and then what happens?  Of course, your point about dispersion over time is a good one, and well made.  It may look different in five more years, even if roughly half of the total coins are already mined.  

Torque, I am definitely holding.  Unlike many on the board, I am doing so without defined expectations of hitting 3000 or 10,000 or 1,000,000 USD.  I like the anonymity, the decentralization, and the utility.  I'm not completely sold on it as a store of value, but we'll see.  I'm 46, which is probably older than average on the board, and I'm guessing I probably have had time to accumulate more assets, as well.  I believe in diverse holdings, and BTC is part of that diversity for me.  I must admit, though, that I'm not so comfortable if part of the value is dependent on the human qualities of the big holders.  That ish can change in a hurry.  But like BCT71 indicates, the makeup of the distribution will change, too.  Eventually, I hope it won't matter who the people are.  

Great replies all, even if I didn't mention you!  Thank you for the being generous with your time to enlighten a new forum member!



 

A druggie with no concrete ideas. Not very interesting, back to watching Gantz. Never trust someone who doesn't allow comments.

That's more likely under a fiat system than a bitcoin-based system. The fiat system assumes the existence of armed enforcers of the monetary system (army, police). Bitcoin does not.

if the 0,01% decide to wipe out the rest of the 99,99% and replace them with intelligent robots.