I am not too worried about government fiat crypto currency.
I think we are entering an era where it will soon become clear to the masses that fiat currency is a bad idea.
This will add fuel to the Bitcoin bubble. It will also undermine any government attempt to launch a fiat centralized cryptocurrency.
So I guess I am optimistic about the future of some yet to be invented altcoin. I am also seriously thinking about investing in bitcoin. I think we could have some ways to go before the huge crash. We are somewhere in the middle of the pyramid right now.
As has been mentioned in the news bitcoin is a perfect asset bubble.
http://www.businessinsider.com/bitcoin-bubble-2013-11
These things can go on for way longer then one would think they could.
Look at the recent housing bubble. That was obvious for years but it kept going and going way longer then I ever thought it would.
What makes me hesitate is I have not yet figured out a way to be confident I get out in time.
Topic: Is Bitcoin a Pyramid or Ponzi scheme & what are the ramifications? - page 6. (Read 10949 times)
November 22, 2013, 02:28:20 AM
November 22, 2013, 02:03:43 AM
Where I disagree with AnonyMint's arguments is the consequences of these facts. AnonyMint envisions a future where all the world's wealth gets sucked up into bitcoin leading to a massive horrendous crash. This is not likely to happen.
Instead I believe the Bitcoin bubble is completely necessary. As was mentioned earlier in the thread a true stable and successful world wide cryptocurrency needs to be widely distributed and dispersed and widely mined ideally by CPU mining. The only way to accomplish that is to role out such a currency to a world population that is largely primed and excited to receive it.
The role of Bitcoin is to prime the world for its successor.
Instead I believe the Bitcoin bubble is completely necessary. As was mentioned earlier in the thread a true stable and successful world wide cryptocurrency needs to be widely distributed and dispersed and widely mined ideally by CPU mining. The only way to accomplish that is to role out such a currency to a world population that is largely primed and excited to receive it.
The role of Bitcoin is to prime the world for its successor.
Actually you and I entirely agree. Very astute. I was actually pitching that outcome but it may be difficult to discern among the constant defense of the prior points. I stated two possible outcomes.
1. Bitcoin goes to $trillions market cap and we have systemic default problem on our hands.
2. Altcoins or other factor halts the ascent before that happens.
However, #2 forks into basically two possibilities and one of them is very scary IMO:
2a. Altcoin(s) and decentralized competition.
2b. Government supply electronic fiat currency.
I've known for a long-time what the government's strategy was, and now they are starting to reveal it:
You parrot Paul Krugman's nonsense. The QE ended up as dollar bond issues in the developing world, because of the carry trade on ZIRP ostensibly through the primary dealers and other arbitrages.
So in 2015 you will hear a giant sucking sound from BRICs et al into the dollar as these loans have to be serviced into a collapsing global trade given ECB just started NIRP (negative interest rate policy).
http://armstrongeconomics.com/2013/11/21/negative-interest-rates-coming-soon-to-a-bank-near-you/
http://armstrongeconomics.com/2013/11/17/negative-interest-rates-eliminating-cash-the-summers-solution/
http://armstrongeconomics.com/2013/11/18/15800/
http://armstrongeconomics.com/2013/11/21/will-electronic-money-be-deflationary/
http://armstrongeconomics.com/2013/11/20/the-tree-has-been-cut-electronic-money-will-force-an-underground-economy-based-on-barter/
http://armstrongeconomics.com/2013/11/20/the-bitcoin-hearing/
http://armstrongeconomics.com/2013/11/19/congressional-hearings-on-bitcoin/
So in 2015 you will hear a giant sucking sound from BRICs et al into the dollar as these loans have to be serviced into a collapsing global trade given ECB just started NIRP (negative interest rate policy).
http://armstrongeconomics.com/2013/11/21/negative-interest-rates-coming-soon-to-a-bank-near-you/
http://armstrongeconomics.com/2013/11/17/negative-interest-rates-eliminating-cash-the-summers-solution/
http://armstrongeconomics.com/2013/11/18/15800/
http://armstrongeconomics.com/2013/11/21/will-electronic-money-be-deflationary/
http://armstrongeconomics.com/2013/11/20/the-tree-has-been-cut-electronic-money-will-force-an-underground-economy-based-on-barter/
http://armstrongeconomics.com/2013/11/20/the-bitcoin-hearing/
http://armstrongeconomics.com/2013/11/19/congressional-hearings-on-bitcoin/
They can accomplish it with the market failure of Bitcoin.
They have two main vectors of takeover:
1. Regulate the people and business who use Bitcoin, since it is not anonymous.
2. Technical takeover employing Amazon et al.
November 22, 2013, 01:55:31 AM
I read both threads. As someone with no stake in BTC right now I am very interested
in reading about the potential flaws before I invest. I appreciate all of you including AnonyMint who
took the time to present clear arguments on the merits of bitcoin. Despite the unnecessary flames and insults the thread overall is quite informative.
As someone who is an outsider (no skin in the game as of yet) I would have answered yes to the now closed poll asking if bitcoin is a pyramid/ponsi scheme. I think it is but its one unlike any the world has ever seen before.
1) The technology behind bitcoin is undoubtedly revolutionary. Something like bitcoin will no doubt be the currency of the future.
2) Bitcoin has several flaws mentioned by AnonyMint the worse of which is the unsolvable income concentration that I agree will doom bitcoin to being a minor player in the future.
3) The price of bitcoin will likely crash and stay crashed at some point in the future. Not at 0 but at some number a lot lower then the majority of buyers paid for it.
Where I disagree with AnonyMint's arguments is the consequences of these facts. AnonyMint envisions a future where all the world's wealth gets sucked up into bitcoin leading to a massive horrendous crash. This is not likely to happen.
Instead I believe the Bitcoin bubble is completely necessary. As was mentioned earlier in the thread a true stable and successful world wide cryptocurrency needs to be widely distributed and dispersed and widely mined ideally by CPU mining. The only way to accomplish that is to role out such a currency to a world population that is largely primed and excited to receive it.
The role of Bitcoin is to prime the world for its successor. It is transparent and this will make it naturally self limiting. The higher the bubble grows the more resentment there will be towards those who got 10,000 + coin for almost nothing. This will naturally prime the way for Bitcoins successor.
For any successor to bitcoin to succeed and actually become a distributed world wide functional currency it will need to be widely adopted from the start. Bitcoin will establish the conditions where that can occur so I view the coming bubble as a largely good thing.
in reading about the potential flaws before I invest. I appreciate all of you including AnonyMint who
took the time to present clear arguments on the merits of bitcoin. Despite the unnecessary flames and insults the thread overall is quite informative.
As someone who is an outsider (no skin in the game as of yet) I would have answered yes to the now closed poll asking if bitcoin is a pyramid/ponsi scheme. I think it is but its one unlike any the world has ever seen before.
1) The technology behind bitcoin is undoubtedly revolutionary. Something like bitcoin will no doubt be the currency of the future.
2) Bitcoin has several flaws mentioned by AnonyMint the worse of which is the unsolvable income concentration that I agree will doom bitcoin to being a minor player in the future.
3) The price of bitcoin will likely crash and stay crashed at some point in the future. Not at 0 but at some number a lot lower then the majority of buyers paid for it.
Where I disagree with AnonyMint's arguments is the consequences of these facts. AnonyMint envisions a future where all the world's wealth gets sucked up into bitcoin leading to a massive horrendous crash. This is not likely to happen.
Instead I believe the Bitcoin bubble is completely necessary. As was mentioned earlier in the thread a true stable and successful world wide cryptocurrency needs to be widely distributed and dispersed and widely mined ideally by CPU mining. The only way to accomplish that is to role out such a currency to a world population that is largely primed and excited to receive it.
The role of Bitcoin is to prime the world for its successor. It is transparent and this will make it naturally self limiting. The higher the bubble grows the more resentment there will be towards those who got 10,000 + coin for almost nothing. This will naturally prime the way for Bitcoins successor.
For any successor to bitcoin to succeed and actually become a distributed world wide functional currency it will need to be widely adopted from the start. Bitcoin will establish the conditions where that can occur so I view the coming bubble as a largely good thing.
November 22, 2013, 12:16:21 AM
I wrote in email:
You still don't get it.
Feel free to fill up the butt hurt form and submit it to air your grievances.
This is such a noob thread its not even funny.
Anonymint, there is a difference between a ponzi scheme and a bubble. In a ponzi/pyramid scheme, the system must be supported with growth at all time, else its worthless. In a bubble, no such growth is necessary; instead, there merely needs to be no impetus to break the bubble. Even if Bitcoin is a bubble, you can't call it a ponzi scheme, for the same reason you can't call traditional fractional reserve banking a ponzi scheme: They do work without growth, so long as there is no panic.
Whether or not Bitcoin is really a bubble is yet to be seen. One might argue that if the bubble doesn't pop, Bitcoin is still inherently a bubble, just one that has remained inflated so long it has solidified itself against popping, since, if everybody did indeed sell and nobody bought, it would be nearly worthless. This is true of almost all money, though, so its sort of just a terminology troll.
As for all this other crap, the answer is Anonymint likes saying everything and anything inflammatory just to be 'rad.' Nothing to see here.
Anonymint, there is a difference between a ponzi scheme and a bubble. In a ponzi/pyramid scheme, the system must be supported with growth at all time, else its worthless. In a bubble, no such growth is necessary; instead, there merely needs to be no impetus to break the bubble. Even if Bitcoin is a bubble, you can't call it a ponzi scheme, for the same reason you can't call traditional fractional reserve banking a ponzi scheme: They do work without growth, so long as there is no panic.
Whether or not Bitcoin is really a bubble is yet to be seen. One might argue that if the bubble doesn't pop, Bitcoin is still inherently a bubble, just one that has remained inflated so long it has solidified itself against popping, since, if everybody did indeed sell and nobody bought, it would be nearly worthless. This is true of almost all money, though, so its sort of just a terminology troll.
As for all this other crap, the answer is Anonymint likes saying everything and anything inflammatory just to be 'rad.' Nothing to see here.
You still don't get it.
Feel free to fill up the butt hurt form and submit it to air your grievances.
November 22, 2013, 12:08:28 AM
This is such a noob thread its not even funny.
Anonymint, there is a difference between a ponzi scheme and a bubble. In a ponzi/pyramid scheme, the system must be supported with growth at all time, else its worthless. In a bubble, no such growth is necessary; instead, there merely needs to be no impetus to break the bubble. Even if Bitcoin is a bubble, you can't call it a ponzi scheme, for the same reason you can't call traditional fractional reserve banking a ponzi scheme: They do work without growth, so long as there is no panic.
Whether or not Bitcoin is really a bubble is yet to be seen. One might argue that if the bubble doesn't pop, Bitcoin is still inherently a bubble, just one that has remained inflated so long it has solidified itself against popping, since, if everybody did indeed sell and nobody bought, it would be nearly worthless. This is true of almost all money, though, so its sort of just a terminology troll.
As for all this other crap, the answer is Anonymint likes saying everything and anything inflammatory just to be 'rad.' Nothing to see here.
Anonymint, there is a difference between a ponzi scheme and a bubble. In a ponzi/pyramid scheme, the system must be supported with growth at all time, else its worthless. In a bubble, no such growth is necessary; instead, there merely needs to be no impetus to break the bubble. Even if Bitcoin is a bubble, you can't call it a ponzi scheme, for the same reason you can't call traditional fractional reserve banking a ponzi scheme: They do work without growth, so long as there is no panic.
Whether or not Bitcoin is really a bubble is yet to be seen. One might argue that if the bubble doesn't pop, Bitcoin is still inherently a bubble, just one that has remained inflated so long it has solidified itself against popping, since, if everybody did indeed sell and nobody bought, it would be nearly worthless. This is true of almost all money, though, so its sort of just a terminology troll.
As for all this other crap, the answer is Anonymint likes saying everything and anything inflammatory just to be 'rad.' Nothing to see here.
November 21, 2013, 11:48:26 PM
The difference between fantasy and delusion, is only the whether the hair grows on the palm of your right or left hand.
https://yourlogicalfallacyis.com/personal-incredulity
November 21, 2013, 11:09:53 PM
The difference between fantasy and delusion, is only the whether the hair grows on the palm of your right or left hand.
November 21, 2013, 11:04:50 PM
Quote
I just don't want to continue arguing the Transactions Withholding Attack with you because (after 8 pages of discussion) I am satisfied already that no one can refute it. You and readers are free to believe what you want.
I'm simpy amazed that this is what you took away from those same 8 pages.
That is ok. All will be proven soon enough. That is why I am the programmer and you are not.
You might be the programmer, but don't forget that when it comes to economics, you'll forever be my student.
November 21, 2013, 11:03:27 PM
Quote
I just don't want to continue arguing the Transactions Withholding Attack with you because (after 8 pages of discussion) I am satisfied already that no one can refute it. You and readers are free to believe what you want.
I'm simpy amazed that this is what you took away from those same 8 pages.
That is ok. All will be proven soon enough. That is why I am the programmer and you are not.
November 21, 2013, 11:00:20 PM
Can people please, please stop encouraging this guy and feeding his need to muddy the forum. It's not intelligent, it's not insightful, it's dribble, babble, nonsense.
Fair point.
I'm out. Anonymint is on my ignore list.
Socialists must stick together and copy each other like mindless drones for alone and independent they are weak and incapable.
Is that what you told yourself when you put me on your ignore list?
Only one person is on my ignore list, anth0ny.
NOW I'm offended.
Quote
I just don't want to continue arguing the Transactions Withholding Attack with you because (after 8 pages of discussion) I am satisfied already that no one can refute it. You and readers are free to believe what you want.
I'm simpy amazed that this is what you took away from those same 8 pages.
November 21, 2013, 10:53:13 PM
Can people please, please stop encouraging this guy and feeding his need to muddy the forum. It's not intelligent, it's not insightful, it's dribble, babble, nonsense.
Fair point.
I'm out. Anonymint is on my ignore list.
Socialists must stick together and copy each other like mindless drones for alone and independent they are weak and incapable.
Is that what you told yourself when you put me on your ignore list?
Only one person is on my ignore list, anth0ny. That is because IMO (at least when he is responding to me) the information content of his posts is freakishly, microscopically low.
I just don't want to continue arguing the Transactions Withholding Attack with you because (after 8 pages of discussion) I am satisfied already that no one can refute it. You and readers are free to believe what you want.
November 21, 2013, 10:34:18 PM
Can people please, please stop encouraging this guy and feeding his need to muddy the forum. It's not intelligent, it's not insightful, it's dribble, babble, nonsense.
Fair point.
I'm out. Anonymint is on my ignore list.
Socialists must stick together and copy each other like mindless drones for alone and independent they are weak and incapable.
Is that what you told yourself when you put me on your ignore list?
November 21, 2013, 10:26:29 PM
I mean, it was just too obvious AM was trolling.
Geez, advocating a CPU-only altcoin as an alternative. Sure, and just how exactly do you want to regulate that? You can burn any algorithm you can run on a general purpose processor onto a dedicated chip.
Geez, advocating a CPU-only altcoin as an alternative. Sure, and just how exactly do you want to regulate that? You can burn any algorithm you can run on a general purpose processor onto a dedicated chip.
That incorrect assumption is why I am a world-class programmer and you are not.
November 21, 2013, 10:23:12 PM
Yes he deleted my post, too, when I asked him to name one Ponzi schema, which is transparent like Bitcoin.
I wasn't going to participate in his strawman non-argumentation, since Bitcoin is not transparent.
And also this:
Not. Because you continue to blithe-fully ignore systemic effects.
No where do I see any dot.com stock professing valuations based on all 7 billion people one day buying in because it is a currency.
Currency is a very powerful implied con. It implies power far beyond any stock exchange, much less individual stock.
And none of those do we claim the economy-of-scale of the whole globe in one investment.
I strongly suggest you read Nicolas Taleb's new bestseller Antifragility.
The strongest characteristic of a ponzi scheme is the massive destruction it causes because the players don't see the systemic risk of pooling themselves. They are blinded to it by a mania.
And that is exactly what we have here today with Bitcoin.
Ha! You ignore systemic risk like any good collectivist does.
Bring all the world's money into one investment, then tell me how can the world function when that investment is not a currency.
You don't seem to understand that if you tie 7 billion people's shoelaces together they now walk as one.
Penny or nanopenny makes no difference. What matters is the relative potential energy outside the single TITANIC THING.
How you relate speculation to transaction volume by value is beyond me.
No where do I see any dot.com stock professing valuations based on all 7 billion people one day buying in because it is a currency.
Currency is a very powerful implied con. It implies power far beyond any stock exchange, much less individual stock.
It does not matter whether we are talking about Internet stocks with currently negative earnings, tulip bulbs, shares of the Blockchain pie, or something "completely useless" such as modern art. The fact is that people are (in most jurisdictions) free to invent, produce and sell things for whatever price they can gouge in a voluntary market. Also buying at inflated prices is not criminalized.
And none of those do we claim the economy-of-scale of the whole globe in one investment.
I strongly suggest you read Nicolas Taleb's new bestseller Antifragility.
The strongest characteristic of a ponzi scheme is the massive destruction it causes because the players don't see the systemic risk of pooling themselves. They are blinded to it by a mania.
And that is exactly what we have here today with Bitcoin.
It has to be noted that this kind of speculative bubbles are almost completely harmless.
Ha! You ignore systemic risk like any good collectivist does.
If the product does not have intrinsic value, its production does not burden the real economy.
Bring all the world's money into one investment, then tell me how can the world function when that investment is not a currency.
bitcoins will always have a price
You don't seem to understand that if you tie 7 billion people's shoelaces together they now walk as one.
Penny or nanopenny makes no difference. What matters is the relative potential energy outside the single TITANIC THING.
D) It seems that the crux of the matter is, whether Bitcoin/bitcoins have intrinsic value as a currency/money or not. If not, it has been a recurring fad over several years and numerous bubbles, which have repeatedly risen higher and higher. In fact, the numbers we are seeing in the exchanges testify that every day until this week has been a bear trap.
How you relate speculation to transaction volume by value is beyond me.
November 21, 2013, 10:18:11 PM
Calling bitcoin a ponzi is soooo 2010.
Like totally chill out with me dude. Have another hit on the bong wookie.
November 21, 2013, 10:09:52 PM
What I resent is this feminism and socialism that tells us everything is fair. Bullshit. Everything is a competition. Even women are competing for what they want, it just so happens their priorities are more in the home+locale realm usually, but not all of course.
But the payback is coming 2016ish. Western civilization will collapse.
Over-generalising/ black-or-white thinking... attempting to predict
Noobie mistakes. Your knowledge gaps are showing.
So we wager a bet?
I will be sleeping. Reply and I will deal with you when I awake.
That is what I thought, just like your username blablahblah.
But to elaborate on my point slightly:
Some things aren't a competition. So your first point is just plain wrong. You could argue that 'everything' is reducible to some competition for resources (e.g.: neural networks getting rewarded with more energy if they solve some problem), but that would make you a closet materialist who believes causality trumps free will. Consistency, Mr Anarchist!
You could well be correct on the second point, but since you're a big fan of chaos, you should know that predicting the weather more than a week ahead is a nightmare with all those terrorist butterflies all trying to 'predict' hurricanes!
Some things aren't a competition. So your first point is just plain wrong. You could argue that 'everything' is reducible to some competition for resources (e.g.: neural networks getting rewarded with more energy if they solve some problem), but that would make you a closet materialist who believes causality trumps free will. Consistency, Mr Anarchist!
You could well be correct on the second point, but since you're a big fan of chaos, you should know that predicting the weather more than a week ahead is a nightmare with all those terrorist butterflies all trying to 'predict' hurricanes!
There is one unarguable truth here, eventually collectivists run out of other peoples' money.
And that is more or less 2016ish. Certainly no later than 2020, western civilization will be in shambles.
Hawker's morals will go right out the window, when butt hurt changes to stomach empty.
November 21, 2013, 07:44:06 PM
I mean, it was just too obvious AM was trolling.
Geez, advocating a CPU-only altcoin as an alternative. Sure, and just how exactly do you want to regulate that? You can burn any algorithm you can run on a general purpose processor onto a dedicated chip.
Geez, advocating a CPU-only altcoin as an alternative. Sure, and just how exactly do you want to regulate that? You can burn any algorithm you can run on a general purpose processor onto a dedicated chip.
November 21, 2013, 06:25:04 PM
Yes he deleted my post, too, when I asked him to name one Ponzi schema, which is transparent like Bitcoin. Everybody can see the source code and can imagine where the higher price comes from. And there is no company or person behind Bitcoin, because Bitcoin is a protocoll.
Sure he sould not name one, so he has to delete such uncomftable questions...
Sure he sould not name one, so he has to delete such uncomftable questions...
November 21, 2013, 04:37:27 PM
What I resent is this feminism and socialism that tells us everything is fair. Bullshit. Everything is a competition. Even women are competing for what they want, it just so happens their priorities are more in the home+locale realm usually, but not all of course.
But the payback is coming 2016ish. Western civilization will collapse.
Over-generalising/ black-or-white thinking... attempting to predict
Noobie mistakes. Your knowledge gaps are showing.
So we wager a bet?
I will be sleeping. Reply and I will deal with you when I awake.
November 21, 2013, 04:25:59 PM
AM, you misunderstand the greater fool theory.
The greater fool theory justifies overpaying for something I don't have confidence in, on the assumption some idiot will come along and pay more for it. As such, if I say to you, "I'm speculatively buying bitcoins because I think they are at least as valuable as the current spot price and will be worth more in the future" you're just going to have to take my word that I'd genuinely rather have a bitcoin than whatever value near $500 they're currently trading at.
Value is a subjective judgment. I cannot prove to you that bitcoin's value is greater or equal to the current spot price any more than you can prove to me that bitcoin's value is objectively zero. Arguing with someone that something they own and feel has intrinsic value doesn't have intrinsic value is a pointless exercise in futility. If something doesn't appear to have any intrinsic value to you, congratulations, stay out of the market for those things.
The greater fool theory justifies overpaying for something I don't have confidence in, on the assumption some idiot will come along and pay more for it. As such, if I say to you, "I'm speculatively buying bitcoins because I think they are at least as valuable as the current spot price and will be worth more in the future" you're just going to have to take my word that I'd genuinely rather have a bitcoin than whatever value near $500 they're currently trading at.
Value is a subjective judgment. I cannot prove to you that bitcoin's value is greater or equal to the current spot price any more than you can prove to me that bitcoin's value is objectively zero. Arguing with someone that something they own and feel has intrinsic value doesn't have intrinsic value is a pointless exercise in futility. If something doesn't appear to have any intrinsic value to you, congratulations, stay out of the market for those things.
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