Fear of missing out

I´d say most people see in Cryptourrencies a way to ensure that the state can no longer engage in these sort of crimes. (I mean extracting wealth from the people and handing it over to the plutocracy)

Seriously most people have no clue what cyryptocurrency is let alone able to comprehend how it is able to replace the fiscal and monetary policies involved in running a stable government through its currency.

To-date, all I have seen are abstract comments on how cryptocurrencies will replace fiat currencies. Unfortunately such views do not stack up to reality. For example, the energy cost to mine Bitcoin is getting so ridiculous that it is estimated the energy requirements will surpass the entire world's electricity requirments by 2020.

https://grist.org/article/bitcoin-could-cost-us-our-clean-energy-future/

Granted the article's facts may be suspect as it lacks credible reference source, there are obvious problems with Bitcoin and unintended consequences.

The argument that somehow people have seized the moral high ground on the role of currency is laughable. It is simply greed in action by speculators wanting to make a quick buck.
 
To-date, all I have seen are abstract comments on how cryptocurrencies will replace fiat currencies. Unfortunately such views do not stack up to reality. For example, the energy cost to mine Bitcoin is getting so ridiculous that it is estimated the energy requirements will surpass the entire world's electricity requirments by 2020.

If your thinking of mining your own coins then have a look at the video below, you need to go big, real big...:-0


 
If your thinking of mining your own coins then have a look at the video below, you need to go big, real big...:-0



Only applies to Bitcoin on that scale, but once again we see how computing is being pushed forward so that only the latest high tech can be used in the efficient mining process. Note, I use the word efficient, not in any power usage sense, but in the mining process itself at this level of difficulty.

Proof of work is the process here, but there are moves afoot to take cryptos off in other less power hungry directions.

The sort of mining i'm looking at would be to do with new issues, whereby it is possible to mine a great number of low value crypto very quickly, rinse and repeat as new issues come to market.

Delayed gratification. Waiting for them to take off. It only takes one from the stable to do something.

A bit like the venture capital model of business funding. Out of 10 companies invested in, 7 may flop, 2 may hold their own and 1 may be the next google.
 
According to the wiki link, a couple of pizzas were exchanged for 10,000 Bitcoin, too funny today :LOL:

Presumably you are referring to this person in 2010 who purchased 2 pizzas using 10,000 Bitcoins which today is worth $190 million. Lol,

https://bitcointalk.org/index.php?topic=137.0

Ive next to no understanding of blockchain etc. Atm as I understand it it takes a pile of effort with a computer to 'mine' Bitcoin, and its get more difficult mine the next Bitcoin, it could be said thats true of any mined resource as the low hanging fruit are taken first. Id imagine these costs are born by the miner not the transactor, idk. Im also not sure how much computing power it takes to transact in Bitcoin, if its a lot by todays measure it could be argued that this might be a non issue with tomorrows hardware, but idk.
The architecture design with Bitcoin is that the proof of work required for each block chain i.e. mining takes approimately 10 mins. The time required by design is to maintain at this rate. The complexity of the mathematical problem requiring solving is automatically scaled up or down based on the hashed rate achieved in solving the most recent block. The irony is Bitcoin is drowning on the weight of its own success with its valuation. As the valuation escalates, it attracts more mining resources and consequently more energy consumption that is chasing for the same payout in mined coins. In other words, while there are more computational resources thrown into the mining, the complexity of the computation challenge rises accordingly to maintain a window of 10 mins to solve the problem within each mining block.

How quantum computers might change this will be interesting to watch.
 
More Famous last words....post51 (y)

20% here 20% there.......who cares, it's all relative
Bitcoin $15,000 next, then on to $20,000.
Crypto market cap still rising, so even though Bitcoin dropped a bit, overall we are still going up.

Well that didn't take long did it!

current price $19,600
has been over $20,000 today

http://www.zerohedge.com/news/2017-...rst-asian-buying-market-cap-soars-above-300-b

Total market cap approaching $600,000,000,000

https://coinmarketcap.com/all/views/all/
 
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You´d be surprised, we all saw how governments across the globe printed money out of thin air and handed it over to the banks.

I´d say most people see in Cryptourrencies a way to ensure that the state can no longer engage in these sort of crimes. (I mean extracting wealth from the people and handing it over to the plutocracy)

B.S. Most people are now buying crypto's because they are going up. It's a mania, nothing more. Governments have been printing money out of thin air for the last 10 years+...decades...debasing has been around for centuries...
 
B.S. Most people are now buying crypto's because they are going up. It's a mania, nothing more. Governments have been printing money out of thin air for the last 10 years+...decades...debasing has been around for centuries...

Yes, debasing has been going on for decades, which is why gold did pretty well since 1971.

But gold is being replaced as we speak, because it is not suitable for the digital era, capital is being reallocated from precious metals towards the new stores of value.

I agree that presently a mania phase is unfolding, and a lot of cryptos will no doubt disappear, but the market must be allowed to operate freely, it´s the best mechanism for removing the bad weeds.

And once they are removed, we will be left with the new digital stores of value, which no government can debase.
 
Yes, debasing has been going on for decades, which is why gold did pretty well since 1971.

But gold is being replaced as we speak, because it is not suitable for the digital era, capital is being reallocated from precious metals towards the new stores of value.

I agree that presently a mania phase is unfolding, and a lot of cryptos will no doubt disappear, but the market must be allowed to operate freely, it´s the best mechanism for removing the bad weeds.

And once they are removed, we will be left with the new digital stores of value, which no government can debase.

Maybe you can explain why a store of value needs to be digital? Will cryptos replace property, art, classic cars, fine wine?

It's all "new paradigm" mania.
 
Maybe you can explain why a store of value needs to be digital? Will cryptos replace property, art, classic cars, fine wine?

It's all "new paradigm" mania.

Needs to be digital because we are living in a transient world now. Everyone has a device. Not sure gold makes sense as it is non portable and current in the physical sense. In the paper sense, it has about as much value as fiat. Yet another market that the elites have screwed over.
 
Needs to be digital because we are living in a transient world now. Everyone has a device. Not sure gold makes sense as it is non portable and current in the physical sense. In the paper sense, it has about as much value as fiat. Yet another market that the elites have screwed over.

Hmmm...I own physical gold and silver because I actually believe what I say about fiat money and a store of value...do you own any real cryptos?
 
Hmmm...I own physical gold and silver because I actually believe what I say about fiat money and a store of value...do you own any real cryptos?

I also believe what I say about fiat money and stores of wealth.
Owning physical gold is fine, but the paper stuff has been used to manipulate the market prices and not in a good way.

I'm working on the cryptos and strategies presently. After the new yr I intend to implement them.
 
Why now cv , cryptos have been around for years ...

Good question.

It's become apparent that govt's and central planners are now losing control. Not only of the financial system but also in suppressing dissenting voices and the information that they are circulating.

I've been wondering for the longest time what course the peoples backlash / revolution would take and it would appear that cryptos fit the bill.
 
. . . Im also not sure how much computing power it takes to transact in Bitcoin, if its a lot by todays measure it could be argued that this might be a non issue with tomorrows hardware, but idk.

If your thinking of mining your own coins then have a look at the video below, you need to go big, real big...
I copied and pasted into Google the part of darktone's post I've quoted in red and there were a ton of results. This article is top of the list: One Bitcoin Transaction Now Uses as Much Energy as Your House in a Week.

Watching the (rather depressing) video that Mike posted and reading this article - I struggle to see how Bitcoin can grow and be sustainable. Given its complexities and the difficulties that the average wo/man in the street has in understanding it - there's no future for it as it stands IMO. Note the emphasis. I quite see that there's a future for some sort of digital currency - I just don't believe that Bitcoin is the one. Perhaps Iota or Ripple or . . . .?
Tim.
 
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Cryptos are not a backlash or revolution from the people , don't be surprised if the same elite you are talking about who is behind the cryptos invention .
 
Maybe you can explain why a store of value needs to be digital? Will cryptos replace property, art, classic cars, fine wine?

It's all "new paradigm" mania.

It's not so much that it needs to be digital as it is that it's better if it's digital because nobody can seize it.

If you are a syrian refugee with 1 million usd In Bitcoin, You can memorize 8 words and that will give you access to that money in whatever country accepts you.

Try leaving Syria with 1 million usd in gold bars ...

I was a buyer of gold and silver for the past two years, I always knew the market was broken, QE has destroyed the economy, the states are bubkrupt and the central banks have lost control, Ive believed this for years but I kept betting on the wrong horse.

1 month ago I finally realized that precious metals have lost the fight, something new and better has arrived, I wasn't smart enough to see it until now, but my stubbornness finally allowed for an alternative.

Cryptos are the new store of value, it is no coincidence that precious metals toped in 2011, when Bitcoin started making the lines and have been in a bear market ever since.

They are no longer relevant, the markets price mechanism is screaming at us that they are being replaced, they are obsolete.
 
It's not so much that it needs to be digital as it is that it's better if it's digital because nobody can seize it.
I keep seeing this fallacy of false choice as if for the majority of us our main consideration in asset protection is against asset seizures. The main risk for the majority of us is asset devaluation not seizure unless you are involved in illegal activities. The problem with Bitcoin et al is that there is no intrinsic value to it. It's current valuation is driven extrinsically through speculative forces. The risk of such valuation disappearing is much greater than if my assets are somehow seized.

If you are a syrian refugee with 1 million usd In Bitcoin, You can memorize 8 words and that will give you access to that money in whatever country accepts you.

Try leaving Syria with 1 million usd in gold bars ...

There are two issues raised. Retention of value and portability. Firstly how many greater fools are out there in driving Bitcoin valuation is unknown but eventually even the supply of fools will run out. Bitcoin has no intrinsic value. It is just 0's and 1's of digital code. What the general population has failed to understand is that the value is not in the digital coin but the transformative technology of blockchain or more descriptively the power of distributed ledger. It is the technology that will transform every industry and more notably the financial industry. For example, Ripple is basically a project by Amex and some banks to transform their back end financial transaction clearing between financial institutions. The Australian Share Registrar has commenced a blockchain project to integrate share transactions, transfer of share ownership and share registry through a distributed ledger system. This will remove layers of activities involving contractual records, matching and transfer of ownership and allowing legal ownership registration to be almost instantaneous.

In regards to portability and the Syrian refugee example, there many asset choices. How many people do you know actually own physical gold bars and I am not referring to gold jewelry? One can easily own $1 million worth of Google or Apple shares with the electronic ownership held by a trustee bank in New York. You just have to remember your password to the share registry account.

I always knew the market was broken, QE has destroyed the economy, the states are bubkrupt and the central banks have lost control,
You are making a bunch of hyperbole statements.You are clearly entitled to your opinion but it doesn't make it a fact.

precious metals have lost the fight, something new and better has arrived,
Kindly enlighten us how metals have lost the fight. What fight?

Are you trying to string together a bunch of disparate opinions as if they are coherent?

Cryptos are the new store of value?
Store of value comprises of two key components - storage and value. While there is no dispute about its storage property and portability, the jury is still out as to its valuation.

The main problem is that digital coins basically have no intrinsic value. Digital coins are simply creation of 0's and 1's of codes and consequently are unlimited in supply. I am happy to hear cogent arguments but spare me any brute force arguments. There is a opportunity cost in mining Bitcoins by way of energy cost but that is not intrinsic value.

There is an argument that for example, Bitcoin is a medium of exchange. Unfortunately that argument is losing credibility progressively because of its volatility and increasing cost to transact as a medium (proof of work energy demand). Unfortunately Bitcoin is becoming useless for anything else other than speculation. A reliable storage value requires two preconditions - value stability and an exchange mechanism.
 
Bitcoin: the World's first decentralised Ponzi scheme
14 December 2017
Let's try to explain, in simple terms, why Bitcoin and other digital pseudo-currencies will fail. Bitcoin is the World's first distributed, decentralised Ponzi scheme. No single operator is running it, and everyone has a chance to participate in it, but its value is determined purely by the weight of money coming into it and the willingness of holders to sell it. Like any Ponzi scheme, earlier participants came in at lower cost, and are now receiving much of the billions of dollars (yes, really) that newcomers are putting in.

Some members of the scheme spend their time telling their friends how they should get in on this Big New Thing and how much money they have already made "on paper", or more accurately "on screen". If your Bitcoins are now "worth" more than you paid for them then you may feel successful, but if you haven't yet cashed out as much as you've put in, then you're still a potential victim. On the other hand, if you've got your cash back or more, then you're already a paid-up and paid-out member of the Bitcoin Ponzi Scheme. And unlike Bernie Madoff, you're probably not going to jail, although some of the self-serving promoters of Bitcoin are skating dangerously close to that if it can be proven that they knew their claims were false and/or were simultaneously selling. Also, unlike the beneficiaries who cashed out of Madoff's funds before he crashed, you probably won't have to pay anything back. That's the beauty of a decentralised Ponzi scheme.

Most of the larger participants will privately admit, if only to themselves, that Bitcoin is a bubble, but they also believe that they can get out before it crashes, or don't much care because they have already cashed out far more than they put in. But just remember this: Bitcoin is essentially a zero-sum game. At any point in time, the cumulative sum of all net cash put in by losers will equal the cumulative sum of all net cash taken out by winners (excluding mining costs).

"But banks are awful - there must be a better way"
Millions of smaller participants, perhaps holding the not-unjustified view that the World's banking systems and governments have failed them, think that Bitcoin or other crypto-tokens are the future of money, some kind of utopian "end of fiat currency" scenario in which we will all trade with each other in units of "crypto-currencies" and take back control of our financial lives. We're here to tell you, for reasons explained below, that as long as the World has governments with the power to tax and spend, that isn't going to happen. Citizens should instead pressure their governments to stop the insane amount of interference in the banking system which has kept it so difficult and expensive for honest people to wire money, open accounts and do business, particularly when they are running small businesses. Banks should not be expected to act as policemen, particuarly now that Governments are getting more access to their customers' data.

No, it's not a currency
To be viable as a currency, something must be both a medium of exchange and a store of value. These are mutually independent criteria: one cannot be satisfied from the other. If a currency doesn't have some intrinsic value relative to real-world assets or liabilities, then even if you can wire it around the world in minutes, it's value will fluctuate based on the willingness of others to take it off your hands and nothing else. It won't be a reliable store of value, so it will be tossed around like a hot potato. Any merchant who accepts it will immediately convert it into a fiat currency to avoid the risk of holding it.

Governments no longer guarantee the exchangability of their currencies for gold, silver or other rare atomic elements. They instead issue "fiat" currencies, basically IOUs, the value of which (measured in other currencies, or the goods and services it can buy) can also crash if they print too much - as Zimbabwe did. A fiat currency is only as good as the country which issues it. However, a government levies taxes in the same currency (creating liabilities for taxpayers), and spends that money to pay civil servants and provide citizens with basic goods and services, such as education, healthcare or public roads, or just hands it out as welfare that its poorer citizens can spend. A government also measures business profits and salaries in the same currency - giving currency its third major function, as a unit of account. You won't see companies or people filling out their tax returns in Bitcoins.

So a government (particuarly an elected one) has an inherent incentive not to dramatically devalue its currency, destabilising its economy with hyperinflation and reducing the real value of both its tax collections and its expenditures. Situations like Zimbabwe are the exceptions that prove the rule, and almost always result in the overthrow of the government involved. Governments therefore aim to manage the quantity of money so that there is just a modest incentive to spend it or lend it; many central banks have declared targets of 2% inflation and some (notably the US Federal Reserve) have a dual mandate of maximising employment.

By comparison, Bitcoin isn't issued by any Government or any single entity. Nobody stands behind it, and its rate of creation is determined not by inflation targets but by a simplistic formula which halves the rate of production every 4 years. Indeed, because supply does not expand to meet demand, Bitcoin has been going through hyper-deflation - the price of everything measured in Bitcoin has been plummeting, making it irrational to spend Bitcoin unless you expect it to decline in value. So perversely, anyone who has the confidence that this is the future of currency is unlikely to spend it.

Incidentally, that formula for the mining rate, like every other aspect of a distributed system, is only set by consensus; it is perhaps only a matter of time before the consensus, out of rational self-interest, decides to abandon the software-imposed cap of 21 million Bitcoins and increase the reward for "mining" it, once the majority of operators have cashed out enough from the Ponzi scheme to make that attractive. What makes you think that a global collective of miners, without a country or an economy to run or an election to win, will not at some point begin to debase their "currency"?

"But its value is its utility"
Some Bitcoin proponents say that its value is derived from its utility as a medium of exchange - but that just takes you round in an infinite loop, because to be able to exchange value for goods and services, a currency must have a widely-accepted, stable value on its own. And even if that utility were there, the fees for transactions have begun rising, make Bitcoin unviable for small transactions. This has also prompted a split within the mining community (known as a "hard fork"), with a new variation in the software to allow more transaction capcity in every 10-minute settlement run. The result is that each old Bitcoin token on 1-Aug-2017 split into a current Bitcoin token and a "Bitcoin Cash" token, and there is no reason why that can't happen again.

The combination of price volatility and transaction fees has also resulted in some early adopters such as Valve Corp (operator of the Steam gaming platform) dropping it as a means of payment.

"But it costs money to mine it"
Other proponents - John McAfee, for example, argue that Bitcoin has value because it costs money to "mine" it in enormous server farms, burning Gigajoules of electricity every second in the "proof of work", literally creating hot air. That, again, is a false and circular argument, because the only reason that so much energy and hardware is being deployed to heat the air is because the price of Bitcoin is so high, and the only reason it is so high is because so much real money is being used to buy Bitcoins.

The key to understanding this is to understand that the Bitcoin software sets the "difficulty" of a cryptographic puzzle so that it is solved by brute force every 10 minutes on average. The more machines working on it, the higher the difficulty is set.

In more detail, the algorithm that all Bitcoin miners run is a distributed lottery in which each machine is performing random "hash" calculations on a "block" of transaction data, and the first machine to produce a hash-value below a certain target "wins" the mining reward, currently 12.5 new Bitcoins, plus a currently-smaller amount of existing Bitcoins deducted as fees from the transactions. Each 10-minute block only has room for a certain number of transactions, so the fees are set by bids attached to the submitted transactions. Indeed, the only thing that you can only buy with Bitcoin is the transaction confirmation.

The first 1,612,800 Bitcoins (up to block 32255) were generated on a single PC in 2009 with a "difficulty" level of 1. Today hundreds of thousands of machines are running the same software, with a difficulty level on block 499035 of 1.59 trillion. But if the price of Bitcoins drops, then machines will be turned off or used to mine another kind of cryto-token, and the difficulty level will drop again, reducing the mining cost in response. So it is the price of Bitcoin that drives the mining cost, not the other way around, and the price is determined by the money flowing into the Ponzi scheme, not by the cost of mining. If only the same amount of energy were being devoted to more useful computational tasks, such as protein folding. For more on the mechanics and origins of Bitcoin and its inherent flaws, see our article The Hole In Bitcoin, 4-Nov-2013.

It can melt down, but you can't melt it down
You won't find any pictures of Bitcoins in this article, because unlike the mass media, we don't want to mislead you into thinking that Bitcoins are shiny, golden and metallic and have some kind of intrinsic value. Bitcoins are just 256-bit sequences of 1s and 0s, or 32-byte numbers. Nothing more than that. When the market crashes, you can't melt them down or use them as jewellery or for electrical circuits. You can just print them out and wonder why you paid so much for a collection of 1s and 0s. The few physical coins that you see in stock photos were just produced as a promotional gimmick. Some are sold "empty" and others have inside them a printed private key for Bitcoins, like a fortune cookie. Anyone who has that key can transfer the Bitcoins electronically, leaving an empty physical coin.

But what about other uses?
Readers may have observed that Bitcoin seems to have found an application, or a partner, in crime. For example, producers of ransomware software have locked down computers and then demanded that the victims purchase and then send Bitcoins to a designated, anonymous network address. This is certainly an application, but for its utility, criminals still depend on ultimately being able to exchange the Bitcoins for real-world goods and services, or equivalently for fiat currency. So although Bitcoin can be used to skirt around the burdensome anti-money-laundering regulations or capital controls as long as it remains in the Bitcoin network, this is rather like entering an underground railway system - you can't stay there forever. At some point, you have to resurface. And if only criminals are using the network, then it's going to be rather difficult to get out without being noticed. So the ransomware operators can buy illegal drugs with Bitcoin, but how are the drug sellers going to convert their Bitcoins into cash or anything else?

Reduced to this level, Bitcoin is just an intermediary system between money-service operators, with victims exchanging cash for Bitcoins, and criminals trying to convert received Bitcoins back into cash without being noticed. No wonder, then, that most of the World's governments have reacted by classifying any exchange that converts fiat currency to or from Bitcoins as a money-services operator, requiring the usual "know your client" obligations that are imposed on banks and remittance firms, thereby imposing similar administrative costs which are reflected in the conversion fees. These regulations severely limit Bitcoin's potential as a payment system for crime.

Join if you want
We don't doubt that some people are getting tremendous entertainment value just watching the price of a small bet (relative to their net worth) on Bitcoin go up and down. It's no different to a night at the casino or the racetrack in that respect. As long as you accept that you could lose everything you bet, you too can participate in the World's first decentralised Ponzi Scheme (or any of its imitators), but just remember that you are purely betting on the greater stupidity of others
 
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