Topic: Why bitcoin is very different from Ponzi/Pyramid/Bubble (Read 3691 times)
I have been starting to think that Gox has been operating like a Ponzi, and they are not getting enough new deposits for the requested withdrawals
Deflation isn't attractive because people seek to convert it to another currency for profit. Deflation is attractive because as the world economy, propelled by innovation and a growing human race, that creates economic growth; When measured against a fixed unit of measure, for example bitcoin with a finite number of coins, by law of simple mathematics, each unit of bitcoin is becoming inherently more valuable. Any fixed unit of measure divided by an increasing amount of stuff increases the value, the amount of stuff that each unit of measure is worth (can buy). This cannot collapse. If it could collapse it would be a pyramid scheme, and not deflation. Words and their definitions matter. Especially in macroeconomics and international banking/finance.
Protocols MUST evolve, so who will take up the task? You are exchanging politicians/bankers to developers, that may sound nice but it is the same thing. Power corrupts.
You assume that code is crystal : Logical, Hard and Transparent, No code is Art: Emotional, Fragile and Ellusive.
If you have not already noticed, bitcoin is already under fire, there is a technical bubble with a burst waiting to happen, greed has been used as a virus, to expand the bitcoin network, but it is also its fatal flaw. Because there are others who understand Greed better and can weaponize it for fun if they choose so. And Who can destroy a thing, can control it. Isn't that right?
It is not a situation of no regulation. It is a situation where the free market will determine the regulation that it wants. I know you're not going to agree entirely.
I don't believe bitcoin is a bubble. The adoption rate is less than 2 million souls and real money hasn't even poured in yet. Bitcoin represents the ability to transact without relying on third parties. I see that people will want this technology. In fact, I see it being the dominant and pervasive means of wealth transfer.
Those that have a moral objection to the early adopters and their hoard of btcs are always welcome to design an alternative protocol. However, one must also abide with the judgement of the markets if that protocol is rejected by open markets. What we individually find just may not be what the market wants. Satoshi understood that and designed a system to encourage early adopters. You can't fight hard money capitalism Thaaanos.
"Protocolizing" behaviour and modus vivendi and taking human decision making out of the loop raises some ethical and philosofical for me.
It is what i call Law as Force of Nature, for me One must always have the choice to break the law. I don't know if you agree or not but think about it hard, because for the first time in history human societies will face that decision.
An ecosystem of protocols and an evolutionary process can avoid the above pitfall, but *not* at a personal level, only at a group level.
I insist that, for bitcoin to achieve currency status, people must be willing to part their bitcoins for goods and services, not for/to FIAT, otherwise it's just a Bet as you said, a speculation, and like all bets there is a possibility of loss, and panic.
IMHO For the above to happen people should be encouraged to spend bitcoins not hodl them, and here lies a design flaw.
And yes there are grave justice issues with early minning that I believe is interlocked with the above issue.
Satosi's plan propably was to demonstrate a proof of concept, that it CAN be done, he propably didnt even thought of the issues of what a wide adoption can mean. His only concern was adoption rate, and achieving critical mass. I could bet that he doesnt even have a single bitcoin, or at least he has some hundreds.
And of course I believe that the bitcoin community should seriously consider, a proper implementation after techincal issues have been dealt, and all financial issues have apriori discussed. And relaunch the project
If not I will have to do make a proper one
myself, remember my suggestions about a rolling blockchain? If only I had time and clear head... Which leads me to your "oh all these coins are pyramid schemes"... but first I will add my mom doesn't have a basement... let me help you grok this. CAPITALISM IS A PYRAMID SCHEME. All of it. You know why stocks boomed from 1950 to the 2000's? Because the world population went from 2 billion to 6 billion. You know why it is crapping out here? Because we cannot extract resources fast enough to downline the 7th billion with the gross excess required to feed the pyramid. Stock market IPOs oar pyramid schemes. Fiat money is pyramid scheme, decaying at fixed rate to guarantee loss to holders. Credit/debt is the ultimate pyramid scheme, requiring exact exponential growth and unavoidable collapse. This is fact. Social security, that's just a ponzi scheme but the differences aren't that significant. There is very little in modern society that is not absolutely dependent on growth. The rate of growth and collapse vary, if it is too short is a disallowed pyramid, if it is long enough it is an allowed pyramid, if it is a genefration r more it is often a legally mandated pyramid.
Think that was all I had to say. Good luck getting out of your shitbox.
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
Two parts to that, the first part is there is a lot of delusion that bitcoin will solve all the evils of the world. I find it interesting, Marx and Lenin believed if the bourgeois class were replaced by working class all would be equal and well with the world. Instead they got Stalin and mass starvation and world wars. Not so easy to figure these things out in advance.
On the other hand, what we have now is a tiny group of people with absolute power and infinite wealth. There are some (many) good things that arise from this but also serious abuses and in the big picture we are all stuck working for them like plantation slaves without the chains. I don't know that bitcoin can change that, but maybe it is a step in that direction. As it is, the real power wants to buy an army to topple a democracy, they write a check. They want to take over and exploit a natural resource, write a check. They want a law passed to give them anything they want anywhere in the world, they write a check. And the more checks they write the more debt there is and the more powerful they become, because they wrote themselves the laws that said they would be the creditors, and all others would be the debtors.
A little known open secret swept under the rug in 2008. When oil clipped $140 a barrel, the few central banks who own the system decided to break the market. They shut down letters of credit to somewhere between 80-130 countries, literally overnight. Now you cannot call Kuwait and order a supertanker full of crude cash-on-delivery. they won't send it. Letters of credit work like escrow through the banking system and all nations are stuck with it (by gunpoint, mostly). So overnight 2/3rds of the world's oil buyers were locked out of the market and a few months later the price of crude was trading in the 30's.
Not to say bitcoin would prevent the concentration of power either. But as is these creditors own money, the idea of money, and have granted themselves infinite resource. It will end badly and if there is an alternative to playing their game, I will take it, on principle, because fuck them.
I am sorry to say that as long as they can legislate they are unfuckable, writing checks is the easy way, they have other ways as you described to fuck markets and people.
The only threat to their domination as they perceive it is Religion, not because they can print money but because they can legislate too
Bitcoin is a toy for them, hell they can even (mis)use it as they use gold right now, fix exchnges, create IOUs, heck they can build a whole new market on top of it, to shamelessly steal more people globally, with minimum fee.
Wages would shrink every year (cause it's deflationary see mate?) while the bitcoin Bonds would inflate at will. and nothing really change except we would be stuck with en even harder currency that freaking EURO.
Protocols MUST evolve, so who will take up the task? You are exchanging politicians/bankers to developers, that may sound nice but it is the same thing. Power corrupts.
You assume that code is crystal : Logical, Hard and Transparent, No code is Art: Emotional, Fragile and Ellusive.
If you have not already noticed, bitcoin is already under fire, there is a technical bubble with a burst waiting to happen, greed has been used as a virus, to expand the bitcoin network, but it is also its fatal flaw. Because there are others who understand Greed better and can weaponize it for fun if they choose so. And Who can destroy a thing, can control it. Isn't that right?
It is not a situation of no regulation. It is a situation where the free market will determine the regulation that it wants. I know you're not going to agree entirely.
I don't believe bitcoin is a bubble. The adoption rate is less than 2 million souls and real money hasn't even poured in yet. Bitcoin represents the ability to transact without relying on third parties. I see that people will want this technology. In fact, I see it being the dominant and pervasive means of wealth transfer.
Those that have a moral objection to the early adopters and their hoard of btcs are always welcome to design an alternative protocol. However, one must also abide with the judgement of the markets if that protocol is rejected by open markets. What we individually find just may not be what the market wants. Satoshi understood that and designed a system to encourage early adopters. You can't fight hard money capitalism Thaaanos.
Two parts to that, the first part is there is a lot of delusion that bitcoin will solve all the evils of the world. I find it interesting, Marx and Lenin believed if the bourgeois class were replaced by working class all would be equal and well with the world. Instead they got Stalin and mass starvation and world wars. Not so easy to figure these things out in advance.
On the other hand, what we have now is a tiny group of people with absolute power and infinite wealth. There are some (many) good things that arise from this but also serious abuses and in the big picture we are all stuck working for them like plantation slaves without the chains. I don't know that bitcoin can change that, but maybe it is a step in that direction. As it is, the real power wants to buy an army to topple a democracy, they write a check. They want to take over and exploit a natural resource, write a check. They want a law passed to give them anything they want anywhere in the world, they write a check. And the more checks they write the more debt there is and the more powerful they become, because they wrote themselves the laws that said they would be the creditors, and all others would be the debtors.
A little known open secret swept under the rug in 2008. When oil clipped $140 a barrel, the few central banks who own the system decided to break the market. They shut down letters of credit to somewhere between 80-130 countries, literally overnight. Now you cannot call Kuwait and order a supertanker full of crude cash-on-delivery. they won't send it. Letters of credit work like escrow through the banking system and all nations are stuck with it (by gunpoint, mostly). So overnight 2/3rds of the world's oil buyers were locked out of the market and a few months later the price of crude was trading in the 30's.
Not to say bitcoin would prevent the concentration of power either. But as is these creditors own money, the idea of money, and have granted themselves infinite resource. It will end badly and if there is an alternative to playing their game, I will take it, on principle, because fuck them.
Are we delusional about Bitcoin? Perhaps. However, in my view, Bitcoin offers the possibility of a hard currency + capitalism. You know, like Germany through the 70's and 80's as it was rebuilding its economy. Even now, the Euro is technically still a hard currency zone, though Draghi is trying his best to subvert that. Germany's response is that you cannot breed a competitive economy based on bailing everyone out. They have a point.
You're also right that Bitcoin is perhaps a step in the direction we all want to head towards. One of the key features of Bitcoin that I favour is the transfer of seigniorage away from corruptible human entities to a predictable protocol. Therein lies the hope and of course the fantasy of a better world. And you're right, we can't go on in a world where central banks have the power to control money and direct it towards political purposes (whether good or bad). They can't help themselves, which is why a trust less system, such as Bitcoin, is required.
Humans now have the potential to move forward based on decentralisation and agreement on open protocols to prevent the kinds of corruption that occurred in the past.
Protocols MUST evolve, so who will take up the task? You are exchanging politicians/bankers to developers, that may sound nice but it is the same thing. Power corrupts.
You assume that code is crystal : Logical, Hard and Transparent, No code is Art: Emotional, Fragile and Ellusive.
If you have not already noticed, bitcoin is already under fire, there is a technical bubble with a burst waiting to happen, greed has been used as a virus, to expand the bitcoin network, but it is also its fatal flaw. Because there are others who understand Greed better and can weaponize it for fun if they choose so. And Who can destroy a thing, can control it. Isn't that right?
Two parts to that, the first part is there is a lot of delusion that bitcoin will solve all the evils of the world. I find it interesting, Marx and Lenin believed if the bourgeois class were replaced by working class all would be equal and well with the world. Instead they got Stalin and mass starvation and world wars. Not so easy to figure these things out in advance.
On the other hand, what we have now is a tiny group of people with absolute power and infinite wealth. There are some (many) good things that arise from this but also serious abuses and in the big picture we are all stuck working for them like plantation slaves without the chains. I don't know that bitcoin can change that, but maybe it is a step in that direction. As it is, the real power wants to buy an army to topple a democracy, they write a check. They want to take over and exploit a natural resource, write a check. They want a law passed to give them anything they want anywhere in the world, they write a check. And the more checks they write the more debt there is and the more powerful they become, because they wrote themselves the laws that said they would be the creditors, and all others would be the debtors.
A little known open secret swept under the rug in 2008. When oil clipped $140 a barrel, the few central banks who own the system decided to break the market. They shut down letters of credit to somewhere between 80-130 countries, literally overnight. Now you cannot call Kuwait and order a supertanker full of crude cash-on-delivery. they won't send it. Letters of credit work like escrow through the banking system and all nations are stuck with it (by gunpoint, mostly). So overnight 2/3rds of the world's oil buyers were locked out of the market and a few months later the price of crude was trading in the 30's.
Not to say bitcoin would prevent the concentration of power either. But as is these creditors own money, the idea of money, and have granted themselves infinite resource. It will end badly and if there is an alternative to playing their game, I will take it, on principle, because fuck them.
Are we delusional about Bitcoin? Perhaps. However, in my view, Bitcoin offers the possibility of a hard currency + capitalism. You know, like Germany through the 70's and 80's as it was rebuilding its economy. Even now, the Euro is technically still a hard currency zone, though Draghi is trying his best to subvert that. Germany's response is that you cannot breed a competitive economy based on bailing everyone out. They have a point.
You're also right that Bitcoin is perhaps a step in the direction we all want to head towards. One of the key features of Bitcoin that I favour is the transfer of seigniorage away from corruptible human entities to a predictable protocol. Therein lies the hope and of course the fantasy of a better world. And you're right, we can't go on in a world where central banks have the power to control money and direct it towards political purposes (whether good or bad). They can't help themselves, which is why a trust less system, such as Bitcoin, is required.
Humans now have the potential to move forward based on decentralisation and agreement on open protocols to prevent the kinds of corruption that occurred in the past.
But thaaanos, we can calculate the cost that transaction fees add to the price paid for goods & services. And it's not really that much. Someone will certainly chime in and claim that it is - but it's not.
So the potentially newest buyer of bitcoin (let's call him buyer n + 1) has to ask himself why he's willing to be buyer n + 1. He's only going to trade his fiat for bitcoin if he believes that bitcoin will be worth more later than it is now. Higher relative to what, you ask? Define it however you want - it just has to be more.
The idea of trading your dollars for bitcoin won't go mainstream unless bitcoin proves that it is a competent & safe store of value. And it better continue to do that really quickly, specifically by convincing new fresh cash to pump into the buy side of the market. If this doesn't happen, the "value" of bitcoin either stays the same, or goes nowhere. If it goes nowhere, will people trade their fiat for bitcoin simply because bitcoin promises, let's say, roughly 3% in gains from no/lower transaction fees? It's possibly, but incredibly unlikely.
Moreover, the analysis itself is crapola: the "Bitcoin Bet" is as follows - will more people want to transact directly with one another without relying on a third party? Yes or no? If yes, Bitcoin economy expands then all the above pseudo analysis is total rubbish, as is most of economics itself because the assumptions are totally unrealistic. GIGO!
Further, bitcoin is deflationary. No one can make more bitcoins so it will always appreciate relative to fiat as long as the bitcoin economy keeps expanding. And why will it expand? Because of the Bitcoin Bet.
It's basically impossible to disagree with the bold; Bitcoin also has that going for it.
But the exchange rate, both history and future, will most likely decide whether or not the average person trades his fiat for bitcoin. And the exchange market has some incredible hurdles to overcome - but it could happen.
Also, I really love the way you use those fun acronyms.
Which leads me to your "oh all these coins are pyramid schemes"... but first I will add my mom doesn't have a basement... let me help you grok this. CAPITALISM IS A PYRAMID SCHEME. All of it. You know why stocks boomed from 1950 to the 2000's? Because the world population went from 2 billion to 6 billion. You know why it is crapping out here? Because we cannot extract resources fast enough to downline the 7th billion with the gross excess required to feed the pyramid. Stock market IPOs oar pyramid schemes. Fiat money is pyramid scheme, decaying at fixed rate to guarantee loss to holders. Credit/debt is the ultimate pyramid scheme, requiring exact exponential growth and unavoidable collapse. This is fact. Social security, that's just a ponzi scheme but the differences aren't that significant. There is very little in modern society that is not absolutely dependent on growth. The rate of growth and collapse vary, if it is too short is a disallowed pyramid, if it is long enough it is an allowed pyramid, if it is a genefration r more it is often a legally mandated pyramid.
Think that was all I had to say. Good luck getting out of your shitbox.
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
Two parts to that, the first part is there is a lot of delusion that bitcoin will solve all the evils of the world. I find it interesting, Marx and Lenin believed if the bourgeois class were replaced by working class all would be equal and well with the world. Instead they got Stalin and mass starvation and world wars. Not so easy to figure these things out in advance.
On the other hand, what we have now is a tiny group of people with absolute power and infinite wealth. There are some (many) good things that arise from this but also serious abuses and in the big picture we are all stuck working for them like plantation slaves without the chains. I don't know that bitcoin can change that, but maybe it is a step in that direction. As it is, the real power wants to buy an army to topple a democracy, they write a check. They want to take over and exploit a natural resource, write a check. They want a law passed to give them anything they want anywhere in the world, they write a check. And the more checks they write the more debt there is and the more powerful they become, because they wrote themselves the laws that said they would be the creditors, and all others would be the debtors.
A little known open secret swept under the rug in 2008. When oil clipped $140 a barrel, the few central banks who own the system decided to break the market. They shut down letters of credit to somewhere between 80-130 countries, literally overnight. Now you cannot call Kuwait and order a supertanker full of crude cash-on-delivery. they won't send it. Letters of credit work like escrow through the banking system and all nations are stuck with it (by gunpoint, mostly). So overnight 2/3rds of the world's oil buyers were locked out of the market and a few months later the price of crude was trading in the 30's.
Not to say bitcoin would prevent the concentration of power either. But as is these creditors own money, the idea of money, and have granted themselves infinite resource. It will end badly and if there is an alternative to playing their game, I will take it, on principle, because fuck them.
But thaaanos, we can calculate the cost that transaction fees add to the price paid for goods & services. And it's not really that much. Someone will certainly chime in and claim that it is - but it's not.
So the potentially newest buyer of bitcoin (let's call him buyer n + 1) has to ask himself why he's willing to be buyer n + 1. He's only going to trade his fiat for bitcoin if he believes that bitcoin will be worth more later than it is now. Higher relative to what, you ask? Define it however you want - it just has to be more.
The idea of trading your dollars for bitcoin won't go mainstream unless bitcoin proves that it is a competent & safe store of value. And it better continue to do that really quickly, specifically by convincing new fresh cash to pump into the buy side of the market. If this doesn't happen, the "value" of bitcoin either stays the same, or goes nowhere. If it goes nowhere, will people trade their fiat for bitcoin simply because bitcoin promises, let's say, roughly 3% in gains from no/lower transaction fees? It's possibly, but incredibly unlikely.
Moreover, the analysis itself is crapola: the "Bitcoin Bet" is as follows - will more people want to transact directly with one another without relying on a third party? Yes or no? If yes, Bitcoin economy expands then all the above pseudo analysis is total rubbish, as is most of economics itself because the assumptions are totally unrealistic. GIGO!
Further, bitcoin is deflationary. No one can make more bitcoins so it will always appreciate relative to fiat as long as the bitcoin economy keeps expanding. And why will it expand? Because of the Bitcoin Bet.
From wiki:
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
In the case of bitcoin, the "subsequent participants" must pay both the old participants, as well as miners electricity bills.
Since the bitcoin transaction are still mostly free today, value created by those transactions is not directly captured by the system.
They are by giving up FIAT for bitcoins. If Fiat is irrelevant then why all the fuss about bitcoin getting higher? Higher relative to what?
But thaaanos, we can calculate the cost that transaction fees add to the price paid for goods & services. And it's not really that much. Someone will certainly chime in and claim that it is - but it's not.
So the potentially newest buyer of bitcoin (let's call him buyer n + 1) has to ask himself why he's willing to be buyer n + 1. He's only going to trade his fiat for bitcoin if he believes that bitcoin will be worth more later than it is now. Higher relative to what, you ask? Define it however you want - it just has to be more.
The idea of trading your dollars for bitcoin won't go mainstream unless bitcoin proves that it is a competent & safe store of value. And it better continue to do that really quickly, specifically by convincing new fresh cash to pump into the buy side of the market. If this doesn't happen, the "value" of bitcoin either stays the same, or goes nowhere. If it goes nowhere, will people trade their fiat for bitcoin simply because bitcoin promises, let's say, roughly 3% in gains from no/lower transaction fees? It's possibly, but incredibly unlikely.
If you don't treat bitcoin as currency, then you self defeat. It would make sense to price goods at bitcoins, if you are not going there then you are going nowhere.
Nope that was pure speculation, but I am not arguing that there is no elitist capitalism, I am arguing that bitcoin is designed to distill it and crystalize it, not Kill it.
I'm sure Btc or derivation of will eventually be dominant. At present it is not, but it's no big deal. Things can be priced in baht and I pay in USD or Btc, no one is getting defeated there.
As I see it, debt based fiat is the real problem. Btc will go a long way to fixing that due to it being deflationary and strongly so over the next few years. Get on board Thaaanos before you get really left behind!
I'd love to speak with someone who said it IS a Ponzi.
From wiki:
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
In the case of bitcoin, the "subsequent participants" must pay both the old participants, as well as miners electricity bills.
Since the bitcoin transaction are still mostly free today, value created by those transactions is not directly captured by the system.
They are by giving up FIAT for bitcoins. If Fiat is irrelevant then why all the fuss about bitcoin getting higher? Higher relative to what?
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
That's right if Elistic Capitalism did not already exist, Bitcoin would have a flatter wealth distribution. The advantage of Bitcoin is that it will be difficult for people to perpetuate their financial advantage via asset price inflation by creating extra monetary units via fractional reserve banking.
I am reading it over and over again, and I can't get a thought straight, your arguments keep me derailing and shortcircuiting.
Re point 1: I believe Bitcoin appreciating relative to fiat indicates the expansion of the Bitcoin economy. Even if Bitcoin is the dominant financial system, it would still make sense to price Bitcoin relative to other fiat currencies.
Re point 2: Elitist Capitalism (and vision) is what allowed the Winkelvii to acquire 1% of existing bitcoins in the first place. Without their financial advantage, that acquisition would have been a lot more difficult. So, Bitcoin will be relatively unequal to start with. However, over time the Winkelvii cannot maintain their financial advantage without spending monetary units of Bitcoin. Whereas under a debt based fiat system, they could take out a loan and invest in ever appreciating asset prices, and thus perpetually maintain their financial advantage over ordinary workers.
If you don't treat bitcoin as currency, then you self defeat. It would make sense to price goods at bitcoins, if you are not going there then you are going nowhere.
Nope that was pure speculation, but I am not arguing that there is no elitist capitalism, I am arguing that bitcoin is designed to distill it and crystalize it, not Kill it.
From wiki:
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
In the case of bitcoin, the "subsequent participants" must pay both the old participants, as well as miners electricity bills.
Since the bitcoin transaction are still mostly free today, value created by those transactions is not directly captured by the system.
They are by giving up FIAT for bitcoins. If Fiat is irrelevant then why all the fuss about bitcoin getting higher? Higher relative to what?
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
That's right if Elistic Capitalism did not already exist, Bitcoin would have a flatter wealth distribution. The advantage of Bitcoin is that it will be difficult for people to perpetuate their financial advantage via asset price inflation by creating extra monetary units via fractional reserve banking.
I am reading it over and over again, and I can't get a thought straight, your arguments keep me derailing and shortcircuiting.
Re point 1: I believe Bitcoin appreciating relative to fiat indicates the expansion of the Bitcoin economy. Even if Bitcoin is the dominant financial system, it would still make sense to price Bitcoin relative to other fiat currencies.
Re point 2: Elitist Capitalism (and vision) is what allowed the Winkelvii to acquire 1% of existing bitcoins in the first place. Without their financial advantage, that acquisition would have been a lot more difficult. So, Bitcoin will be relatively unequal to start with. However, over time the Winkelvii cannot maintain their financial advantage without spending monetary units of Bitcoin. Whereas under a debt based fiat system, they could take out a loan and invest in ever appreciating asset prices, and thus perpetually maintain their financial advantage over ordinary workers.
From wiki:
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
In the case of bitcoin, the "subsequent participants" must pay both the old participants, as well as miners electricity bills.
Since the bitcoin transaction are still mostly free today, value created by those transactions is not directly captured by the system.
They are by giving up FIAT for bitcoins. If Fiat is irrelevant then why all the fuss about bitcoin getting higher? Higher relative to what?
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
That's right if Elistic Capitalism did not already exist, Bitcoin would have a flatter wealth distribution. The advantage of Bitcoin is that it will be difficult for people to perpetuate their financial advantage via asset price inflation by creating extra monetary units via fractional reserve banking.
I am reading it over and over again, and I can't get a thought straight, your arguments keep me derailing and shortcircuiting.
From wiki:
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
An economic bubble: A bubble is similar to a Ponzi scheme in that one participant gets paid by contributions from a subsequent participant (until inevitable collapse). A bubble involves ever-rising prices in an open market (for example stock, housing, or tulip bulbs) where prices rise because buyers bid more because prices are rising. Bubbles are often said to be based on the "greater fool" theory. As with the Ponzi scheme, the price exceeds the intrinsic value of the item, but unlike the Ponzi scheme, there is no single person misrepresenting the intrinsic value
--------------------------------------------------------------------------------
In the case of bitcoin, the "subsequent participants" must pay both the old participants, as well as miners electricity bills.
Since the bitcoin transaction are still mostly free today, value created by those transactions is not directly captured by the system.
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
That's right if Elistic Capitalism did not already exist, Bitcoin would have a flatter wealth distribution. The advantage of Bitcoin is that it will be difficult for people to perpetuate their financial advantage via asset price inflation by creating extra monetary units via fractional reserve banking.
Which leads me to your "oh all these coins are pyramid schemes"... but first I will add my mom doesn't have a basement... let me help you grok this. CAPITALISM IS A PYRAMID SCHEME. All of it. You know why stocks boomed from 1950 to the 2000's? Because the world population went from 2 billion to 6 billion. You know why it is crapping out here? Because we cannot extract resources fast enough to downline the 7th billion with the gross excess required to feed the pyramid. Stock market IPOs oar pyramid schemes. Fiat money is pyramid scheme, decaying at fixed rate to guarantee loss to holders. Credit/debt is the ultimate pyramid scheme, requiring exact exponential growth and unavoidable collapse. This is fact. Social security, that's just a ponzi scheme but the differences aren't that significant. There is very little in modern society that is not absolutely dependent on growth. The rate of growth and collapse vary, if it is too short is a disallowed pyramid, if it is long enough it is an allowed pyramid, if it is a genefration r more it is often a legally mandated pyramid.
Think that was all I had to say. Good luck getting out of your shitbox.
What I just fail to see is the "Revolutionary" part of bitcoin, it would be more honest to claim bitcoin crystalizes Elitistic Capitalism
Which leads me to your "oh all these coins are pyramid schemes"... but first I will add my mom doesn't have a basement... let me help you grok this. CAPITALISM IS A PYRAMID SCHEME. All of it. You know why stocks boomed from 1950 to the 2000's? Because the world population went from 2 billion to 6 billion. You know why it is crapping out here? Because we cannot extract resources fast enough to downline the 7th billion with the gross excess required to feed the pyramid. Stock market IPOs oar pyramid schemes. Fiat money is pyramid scheme, decaying at fixed rate to guarantee loss to holders. Credit/debt is the ultimate pyramid scheme, requiring exact exponential growth and unavoidable collapse. This is fact. Social security, that's just a ponzi scheme but the differences aren't that significant. There is very little in modern society that is not absolutely dependent on growth. The rate of growth and collapse vary, if it is too short is a disallowed pyramid, if it is long enough it is an allowed pyramid, if it is a genefration r more it is often a legally mandated pyramid.
Think that was all I had to say. Good luck getting out of your shitbox.
Jump to: