Bitcoin... currency of the future or fraud/scam/bubble?

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pre med 2014 said:
well you can purchase a property in Dubai using Bitcoin... granted the property values in Dubai fluctuate just about as much as cryptocurrency it's not surprising it's happening lol

Once it is mainstream enough that people can easily transfer funds between phones it will compete with apps like venmo etc...
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I believe there will be a cryptocurrency one day used as currency. It won't be bitcoin though. For starters, the blockchain can support 7 transactions a second. Second, Bitcoin uses an enormous (and increasing) amount of energy which is reaching a breaking point. Third, a Bitcoin transaction is actually quite expensive and that added cost doesn't mesh well with microtransactions.
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surfguy84 said:
Plenty of "paper" money isn't actually paper but is simply digital numerical value in an account, etc.
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I can go to the bank and they'll give me paper for it, though. Plus, like I said, there's cryptography involved with Cryptocurrency. Regardless, I'm not sure why this is even a discussion.
 
What's up with XRP? South Korea just bought into it. It's cheaper/faster to buy/sell/exchange.
Looks like it's still in it's infancy.
 
Fraud. Lacks intrinsic value of proper currencies (dollar “intrinsic” value comes from being tied to taxes => property). Plenty of times in history people have been able to gain massive profit from unsound businesses.
 
parcus said:
Fraud. Lacks intrinsic value of proper currencies (dollar “intrinsic” value comes from being tied to taxes => property). Plenty of times in history people have been able to gain massive profit from unsound businesses.
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bitcoin is tied to taxes. If you sell your bitcoin for a profit you have to report it as capital gains on your tax return. Bitcoin is only anonymous in and of itself but any medium that you convert it to USD is tied to your identity.
 
pgg said:
Bitcoin is being used as currency now less than it was a year ago. Actually spending bitcoin on stuff is harder now than it was weeks or months ago. It's being hoarded by speculators, not spent.
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but does it have to be used as currency to survive long term? People don't use stocks as currency, and the end game is the same as bitcoin -> buy low and sell high for a profit, and stock value is based on what people perceive value of a company to be not what it is actually worth
 
pre med 2014 said:
bitcoin is tied to taxes. If you sell your bitcoin for a profit you have to report it as capital gains on your tax return. Bitcoin is only anonymous in and of itself but any medium that you convert it to USD is tied to your identity.
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No, US government states that the dollar is legal tender, for this reason it will likely always be accepted to pay taxes (albeit it is possible for it to become almost worthless, depending on inflation). On the other hand, bitcoins are merely 0 and 1 in computers, when people realize it offers no real advantages compared to other currencies, people will not trade anything for bitcoins and lots of people will loose a lot of money in that gamble.
 
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Bitcoin 3-4 transactions per second.
Visa 56,000 transactions per second.
 
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nolagas said:
Bitcoin 3-4 transactions per second.
Visa 56,000 transactions per second.
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Lightning Network
"capable of millions to billions of transactions per second across the network. Capacity blows away legacy payment rails by many orders of magnitude"
 
A. Test was successful
Lightning Protocol 1.0: Compatibility Achieved ✅ – Lightning Developers – Medium

B. A is solution to B. lightning network offloads and packages together multiple transactions off the bitcoin network to be processed later more efficiently. Also once all coins are mined (remember finite number of coins) the energy usage to process transactions would be minimal.

Look, I'm not an expert on any of this, i'm just YouTube certified. I agree with you that it is theory and speculation. But I'm rooting for bitcoin to change the monetary system. I just really really hate central banks.
 
pre med 2014 said:
but does it have to be used as currency to survive long term? People don't use stocks as currency, and the end game is the same as bitcoin -> buy low and sell high for a profit, and stock value is based on what people perceive value of a company to be not what it is actually worth
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Stocks represent ownership of actual real companies that produce actual things of value, thereby generating actual wealth.

Bitcoin generates negative real wealth in that it costs energy and hardware to "mine" them, yet produces nothing. You could almost say the same of gold, almost, except that gold has some actual uses (jewelry, industry), has been around for thousands of years, and ... oh yeah ... unlike bitcoin, can actually be traded for goods and services.

But yeah, they're totally the same thing.
 
Surfer said:
What are your thoughts on bitcoin? its a complicated currency, but I think its a fraud/bubble driven mostly by greed and a little bit by people's fears initiated by government intrusion into the international banking systems.

what do you all think?
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Huge bubble.

Kind've like the Tulips from the 1600s just fancier.
 
pre med 2014 said:
Except it's on a global scale, anybody in the entire world can buy a bitcoin. This means that much more demand is possible than for other types of bubbles
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A larger pool of suckers doesn't magically make bitcoin viable, enduring, or useful.
 
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pgg said:
A larger pool of suckers doesn't magically make bitcoin viable, enduring, or useful.
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No, but it does mean the bubble can grow further and faster than the other speculative bubbles we've already seen. I thought for sure the bubble was about to pop when bitcoin plateaued around $4800 after shooting up from $400. Of course, since anyone in the world can also sell bitcoin, when this does crash it's going to crash hard.
 
Chip N Sawbones said:
No, but it does mean the bubble can grow further and faster than the other speculative bubbles we've already seen. I thought for sure the bubble was about to pop when bitcoin plateaued around $4800 after shooting up from $400. Of course, since anyone in the world can also sell bitcoin, when this does crash it's going to crash hard.
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That old saying, the market can remain irrational longer than you can remains solvent. :)

The only question is whether or not bitcoin will be useful for anything after the crash. It's already fairly well established that it's not useful for actually purchasing goods or services outside the black market, given its transaction times, transaction costs, blockchain size/unwieldiness, volatility, not to mention its nebulous legal state in much of the world.

Post crash, when it's neither a useful currency nor a speculative tool for fleecing the greater fool ... what'll it be good for?

It'll be interesting to watch.
 
pgg said:
That old saying, the market can remain irrational longer than you can remains solvent. :)

The only question is whether or not bitcoin will be useful for anything after the crash. It's already fairly well established that it's not useful for actually purchasing goods or services outside the black market, given its transaction times, transaction costs, blockchain size/unwieldiness, volatility, not to mention its nebulous legal state in much of the world.

Post crash, when it's neither a useful currency nor a speculative tool for fleecing the greater fool ... what'll it be good for?

It'll be interesting to watch.
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How can it be a stable currency when there are people literally using algorithms to "mine" further cryptocurrency that has zero backing it up besides 0 and 1s on a computer? Wouldn't want to be holding the bag when it collapses.
 
pgg said:
That old saying, the market can remain irrational longer than you can remains solvent. :)

The only question is whether or not bitcoin will be useful for anything after the crash. It's already fairly well established that it's not useful for actually purchasing goods or services outside the black market, given its transaction times, transaction costs, blockchain size/unwieldiness, volatility, not to mention its nebulous legal state in much of the world.

Post crash, when it's neither a useful currency nor a speculative tool for fleecing the greater fool ... what'll it be good for?

It'll be interesting to watch.
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Agree that Bitcoin will not be used as used as everyday currency, but some of the other cryptocurrencies could one day (Ripple and IOTA, make it MUCH cheaper or even free to perform transactions). I think bitcoin's true value comes to those who require it's anonymity. It's a GREAT way to fund nefarious enterprises, but provides some diversion around currency controls in countries trying to clamp down on currency flight (think South America, esp. Venezuela).
 
facted said:
Agree that Bitcoin will not be used as used as everyday currency, but some of the other cryptocurrencies could one day (Ripple and IOTA, make it MUCH cheaper or even free to perform transactions). I think bitcoin's true value comes to those who require it's anonymity. It's a GREAT way to fund nefarious enterprises, but provides some diversion around currency controls in countries trying to clamp down on currency flight (think South America, esp. Venezuela).
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Bitcoin isn't actually all that anonymous. Every transaction is recorded, so there's a clear history of which wallets sent and received money. The ownership of a certain wallet might not be known, but if it is ever found out then there's a clear paper trail leading to and from it. There are ways around this such as "tumbling" the bitcoins by sending them to a third party that breaks up the payment into several smaller ones, but other cryptocurrencies like Monero do anonymous transactions much better than Bitcoin. Ultimately I think Bitcoin is going to be the equivalent of AOL in the dotcom boom- a clear winner early on, but unable to adapt to the rapidly changing digital universe.
 
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facted said:
Agree that Bitcoin will not be used as used as everyday currency, but some of the other cryptocurrencies could one day (Ripple and IOTA, make it MUCH cheaper or even free to perform transactions). I think bitcoin's true value comes to those who require it's anonymity. It's a GREAT way to fund nefarious enterprises, but provides some diversion around currency controls in countries trying to clamp down on currency flight (think South America, esp. Venezuela).
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Bitcoin isn't anonymous. Every transaction is preserved, forever, in the blockchain.

It's right there on the FAQ - Some things you need to know - Bitcoin
 
sit on the sidelines and continue to call it a tulip/bubble. meanwhile ive had more gains in 6 months trading crypto than a lot of you have had in 20 years in the market...#notabubble
 
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GaseousClay said:
sit on the sidelines and continue to call it a tulip/bubble. meanwhile ive had more gains in 6 months trading crypto than a lot of you have had in 20 years in the market...#notabubble
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Not doubting you made a ton of money, but that doesn't mean it's not a bubble. Could very well be. Time will tell.
 
GaseousClay said:
sit on the sidelines and continue to call it a tulip/bubble. meanwhile ive had more gains in 6 months trading crypto than a lot of you have had in 20 years in the market...#notabubble
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Isn’t this the very definition of a bubble?
 
GaseousClay said:
sit on the sidelines and continue to call it a tulip/bubble. meanwhile ive had more gains in 6 months trading crypto than a lot of you have had in 20 years in the market...#notabubble
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Everything works perfectly as long as you can find a greater fool to sell to.
 
As bitcoin becomes more and more mainstream i'm starting to see it more and more as a bubble.

At work and around family/friends I am known as the bitcoin guy. For years (2013-recently) I preached about it to people that would listen. I would tell them how revolutionary it is... bring down the banks... world currency, et patati et patata. Now some people think i'm a secret millionare lol.

Anyway. Today at work the doorman stopped to ask me "is it too late to get in man?" with a thirsty/desperate look on his face.
Later that day, my co-worker (who never gave a crap about bitcoin before) tells me "bitcoin is down today" staring at his phone with a concerned look on his face. I was too afraid to ask how much did he drop in there.

So yeah. Its probably a bubble. The normies killed bitcoin.

*Disclaimer I do not own bitcoin. The most I owned was $25 worth that I then lost at one of those dice sites.
 
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pgg said:
I heard the term "Dunning-Krugerrand" used to refer to Bitcoin this morning.

I chortled.
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Hey! I actually really am financial genius though, the only reason this thread was revived from 2013 is because of my foresight... However, since I am generally limited in this capacity, the fact that I was actually correct about bitcoin from as far back as almost 5 years ago may have led me to erroneously fancy myself at the genius level of cognitive capacity at least in the realm of finances.

That being said, I think it is safe to say there is no shortage of fools abroad and in the U.S. so don't expect bitcoin to crash so fast
 
mostwanted said:
Use coinbase?
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Yup, much faster and easier to use than Kraken. Downside is the fees are higher. If you buy any cryptos using your bank account, it will guarantee the current price until bank transfer goes through. Kraken will do the exact opposite and credit them to your account when they receive the money. Downside of that is that price of the currency you wanted to buy may be different than today's.

Be aware that if you use a credit card to buy, your bank will charge you a cash advance fee. If you buy with a debit card, coinbase routes its transactions through a bank in London so your bank will charge you a foreign transaction fee of approx. $12.

If you want to play it safe, just deposit money into your US dollar wallet @ coinbase (not into any of the cryptocurrency wallets). That way you can decide what to acquire when the funds become available. Downside of that is that the price may have increased a few days from now. It just depends what compromise you're willing to make.

P.S: Coinbase will let you use a credit card but Kraken won't. Kraken is more of an exchange like Binance.
 
pgg said:
Meanwhile, the North American BitCoin conference in Miami stopped accepting BitCoin as payment due to fees and congestion.

But sure, it's a viable currency.
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Bitcoin is not a viable currency, and will likely not never be. That doesn't at all mean that other cryptocurrencies won't be in the future. Take a look at ether, ripple, IOTA or a number of others. The blockchain technology is not going away. I was listening to a podcast today about the ACH system for transferring money from one bank to another. It takes 5+ business days. For example, Ripple can transfer money in a secure fashion in 4 seconds at very low cost.
 
facted said:
Bitcoin is not a viable currency, and will likely not never be. That doesn't at all mean that other cryptocurrencies won't be in the future. Take a look at ether, ripple, IOTA or a number of others. The blockchain technology is not going away. I was listening to a podcast today about the ACH system for transferring money from one bank to another. It takes 5+ business days. For example, Ripple can transfer money in a secure fashion in 4 seconds at very low cost.
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I'm not sure there's much point in comparing ACH bank transfers to, well, anything other than a personal check sent by 11th class international parcel post. :)

In a world that has Visa cards and bank wires, I just can't get excited about a revolutionary cryptocurrency that can transfer money in 4 seconds. Yay?


I'm sure at some point, some cryptocurrency will be useful, for something, outside of a pool of speculators.
 
pgg said:
I'm not sure there's much point in comparing ACH bank transfers to, well, anything other than a personal check sent by 11th class international parcel post. :)

In a world that has Visa cards and bank wires, I just can't get excited about a revolutionary cryptocurrency that can transfer money in 4 seconds. Yay?


I'm sure at some point, some cryptocurrency will be useful, for something, outside of a pool of speculators.
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Except that ACH did 24 billion transfers for 40 trillion dollars in 2015.

Automated Clearing House - Wikipedia

High costs associated with it and other payment modalities (ahem credit cards) make these fields ripe for disruption. Not saying it's happening now, but within 10 years, it's certainly possible. Better to get in on the ground floor with a small amount of money (that you're willing to lose) than pay a premium once things go big.
 
facted said:
Except that ACH did 24 billion transfers for 40 trillion dollars in 2015.

Automated Clearing House - Wikipedia
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I know what ACH is. If you need to move money quickly, you use a bank wire. If it doesn't matter if it takes a few days, or the payment is predictable well in advance, you can use ACH. The point is that ACH is not intended to be an instant transaction - so why are you comparing a 5 day ACH transfer to a 4 second cryptocurrencyofthemoment transfer?

That's totally putting aside the trivial issue that cryptocurrencyofthemoment can't actually be traded for 99%+ of the goods or services one would want to spend money on in the first place, without first paying the fee and waiting the time to convert it into an actual currency aceepted by actual businesses.


facted said:
High costs associated with it and other payment modalities (ahem credit cards) make these fields ripe for disruption. Not saying it's happening now, but within 10 years, it's certainly possible. Better to get in on the ground floor with a small amount of money (that you're willing to lose) than pay a premium once things go big.
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What are you arguing here? That I need to "get in on the ground floor" by buying some cryptocurrency now, lest I have to pay a premium when things go big?

Are you telling me that you can predict which cryptocurrency is going to be the standard in 10 years? Maybe I should buy some of each, just in case?

Are you telling me that in 10 years when cryptocurrencyof2028 (CC2028) is dominant, that I won't be able to trade $100 for some CC2028 and then use CC2028 to buy roughly $100 worth of goods or services? That I'll be locked out of that medium of exchange forever because I'm not buying buying buying today? That I'll be gnashing my teeth at my inability to spend my $100, wishing I could go back in time and buy some Dogecoin or whatever ended up winning?

Are you actually saying and believing these words?


Thanks, but I'll take my chances. I hope you make a lot of money off that money "that you're willing to lose" ...
 
pgg said:
I know what ACH is. If you need to move money quickly, you use a bank wire. If it doesn't matter if it takes a few days, or the payment is predictable well in advance, you can use ACH. The point is that ACH is not intended to be an instant transaction - so why are you comparing a 5 day ACH transfer to a 4 second cryptocurrencyofthemoment transfer?

That's totally putting aside the trivial issue that cryptocurrencyofthemoment can't actually be traded for 99%+ of the goods or services one would want to spend money on in the first place, without first paying the fee and waiting the time to convert it into an actual currency aceepted by actual businesses.




What are you arguing here? That I need to "get in on the ground floor" by buying some cryptocurrency now, lest I have to pay a premium when things go big?

Are you telling me that you can predict which cryptocurrency is going to be the standard in 10 years? Maybe I should buy some of each, just in case?

Are you telling me that in 10 years when cryptocurrencyof2028 (CC2028) is dominant, that I won't be able to trade $100 for some CC2028 and then use CC2028 to buy roughly $100 worth of goods or services? That I'll be locked out of that medium of exchange forever because I'm not buying buying buying today? That I'll be gnashing my teeth at my inability to spend my $100, wishing I could go back in time and buy some Dogecoin or whatever ended up winning?

Are you actually saying and believing these words?


Thanks, but I'll take my chances. I hope you make a lot of money off that money "that you're willing to lose" ...
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To answer one of your points, you are totally correct that is difficult to predict the winners. I have some money spread out among a few.

You will certainly not be locked out of buying anything in the future. But were you also refusing to buy any tech stocks in .com era? What is your had put in a small amount of money in 30 companies and one happened to be amazon? Your astronomical gains from that one transaction would never dwarfed your losses on the others. There's a huge future in cryptocurrency and blockchain technology, but you're right it's unclear who the winners will be.

I think you'd be happy to know that I have about 99% of my investments in tax deferred, diversified low cost index funds. The little crypto money I've out down is a drop in the bucket that might hopefully turn up big.
 
facted said:
To answer one of your points, you are totally correct that is difficult to predict the winners. I have some money spread out among a few.

You will certainly not be locked out of buying anything in the future. But were you also refusing to buy any tech stocks in .com era? What is your had put in a small amount of money in 30 companies and one happened to be amazon? Your astronomical gains from that one transaction would never dwarfed your losses on the others. There's a huge future in cryptocurrency and blockchain technology, but you're right it's unclear who the winners will be.

I think you'd be happy to know that I have about 99% of my investments in tax deferred, diversified low cost index funds. The little crypto money I've out down is a drop in the bucket that might hopefully turn up big.
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:)

I bought tech stocks in the dotbomb era and lost some money. I'm not very smart, but I can be taught.


What you're arguing is textbook "fear of missing out" aka the root of all evil when it comes to jumping onto bubbly bandwagons.

Another problem is that you guys are taking it as self evident / axiomatic that "there's a huge future in cryptocurrency and blockchain technology" ... that may be true, or it may come to be squashed and/or dominated by governments choosing to regulate or legislate away the decentralized, tax-avoiding, sanction-avoiding, pseudo-anonymity of cryptocurrencies. And even if a cryptocurrency or blockchain becomes the foundation of something big in the future, there's no reason to believe that any of the things you're buying today will be part of that.


Again I hope y'all make a ton of money trading crypto. Just as I'd be cheering for you if you said you were spending the weekend in Vegas. :)
 
I’m a firm believer in the future of Crypto for a number of reasons and I’m an active investor and occasionally trading.

The crypto market isn’t going anywhere and is only growing. I say it’s an exciting time to get in in the infancy stages of this new technology and mode of commerce.

I will say Do your research before investing (or day trading), as there are many sh*tcoins, pump and dumps and volatility (Lots of volatility, like the stock market).

There are a lot of doubters, but If Wall St is sniffing around and investing, there must be something to that. Like the tech bubble of the late 90s early 2000s, there will be lots of coins that will go belly up (there are 1000s of coins). There are some coins that are a strong long term hodl.

Anyone curious about crypto currency, specifically bitcoin, take. Look at Banking on Bitcoin on Netflix.
 
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