Saturday, November 2, 2019

Bitcoin, 11-years in

Satoshi's first email [source]

Eleven years ago, Satoshi Nakamoto announced cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 bitcoin whitepaper to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 world. Coinbase, a large cryptocurrency exchange, recently celebrated this milestone with a retrospective.

I'm going to remix Coinbase's narrative to tell a different account of bitcoin's last 11-years.

The thing that fooled us all for a while, myself included, is that we all thought bitcoin was solving a monetary or payments problem. It was labelled a coin, after all, and coins fall within cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 realm of monetary economics. To furcá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r complicate matters, Satoshi told his story using phrases like "electronic cash system" and "non-reversible transactions". Perhaps we deserve to be forgiven for not seeing bitcoin's underlying nature. After all, tearing down cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 existing monetary system and building a new one was a fresh and exciting narrative.

Anyways, Coinbase still believes this old tale. "As with ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r technologies, money has gone through many upgrades over cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 years," its marketing team writes. "Bitcoin is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 latest breakthrough in a technology that’s millennia old."

What is now apparent is that bitcoin was never a monetary phenomenon. No, bitcoin is a new sort of financial betting game. It is a digital, global, highly-secure, and fairer version of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 old-fashioned chain letter.

The premise behind bitcoin-cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365-game is that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 current wave of buyers must guess when (or if) a subsequent wave of buyers will emerge, this second next wave's participation being contingent on when (or if) cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y believe a third wave of buyers to emerge. If cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y guess right, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 early birds win at cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 expense of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 late ones. And cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y can win a lot of money, as Coinbase points out in its post:

Source: Coinbase

Think of bitcoin as a pure mind game, a Keynesian beauty contest in which we "devote our intelligences to anticipating what average opinion expects cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 average opinion to be." Those old fashioned chain letters that you (or your parents) used to get in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 mail were an early type of beauty contest. The price that Alice was willing to place on a chain letter was a function of whecá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r she expected cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 next recipient, Bill, to play by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rules and send it on, Bill's expectation in turn depending on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 odds that Jack would join cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 game.

But chain letters had a major flaw. The chain order could be easily compromised by a fraudster who miscopied cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 list and put cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir name at cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 front. Bitcoin fixes this by introducing robustness to chain letter-type games. Bitcoin's blockchain is an unbreakable public record of where in line game players stand. Altering this chain order would require tremendous amounts of computer power, as Coinbase illustrates in this chart:

Coinbase: Source

Bitcoin-cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365-game has been spectacularly successful. As Coinbase points out, it "went from an idea in 2008, and a first transaction in 2009, to over 27 million users in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 US alone in 2019, or 9% of Americans." Below, Coinbase has charted cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 number of active bitcoin addresses that have been created over cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 years:

Source: Coinbase

Why did bitcoin-cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365-game succeed?

First, it's a fun and cutting-edge game. Many people dream of thrusting cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365mselves out of financial obscurity into millionaire land. Bitcoin is a technologically-sophisticated way to get cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re. No one wants to play grandpa's lottery.

Secondly, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 way that bitcoin is designed helps it spread. Most of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 legacy financial games that bitcoin competes with (poker, lotteries, sports betting) are regulated by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 government. Strict rules prevent game providers from reaching a wide audience. For instance, online casinos may be prevented from serving out-of-state players, problem gamblers may be banned, and those who are under 18 must be excluded. These financial games are usually centralized. This means cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y are hosted on a single website, or at a physical location like a casino, or by a government-run lottery corporation. Which makes it easy for regulators to shut down game providers who break cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rules.

But bitcoin is different. Because it is a decentralized and digital financial game, it can't be regulated or shut down. And so it can serve cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 entire globe with impunity. Which it has done by spreading into every crack and cranny on earth. As is illustrated by anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r of Coinbase's charts:

Source: Coinbase

Based entirely on whisps and storms of psychology, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 price of bitcoin is inherently volatile. Its core volatility has stayed pretty much constant over cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 last 11-years. Users should expect cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 same for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 next 11 years. Even if more people join a Keynesian beauty contest, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 average opinion of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 average opinion will always be a fickle, inconsistent thing, and so price will always be jittery.

So what about bitcoin-as-money? Yes, people do use bitcoin for payments. But this gets dwarfed by its popularity as a financial game. The problem is this. Bitcoin payment functionality is implemented on top of a highly volatile chassis, a fun but fickle beauty contest. Which hobbles cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 effectiveness of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 payments platform. Regular folks won't use cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 stuff to pay. They don't want cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 value of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir spending stash to fall by 20% overnight. And game players don't want to waste cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir tokens on buying goods & services. That could mean potentially missing out on a life changing jackpot. That's why cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 promise of mainstream bitcoin payments has died a thousand deaths over cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 last 11 years.

That being said, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 demand for bitcoin in economically volatile regions such as Venezuela has hit record highs. Coinbase suggests that thanks to inflation and capital controls, bitcoin is finally being used as cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 electronic cash for which it was originally designed.

Source: Coinbase

Coinbase could be right. In places like cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 U.S. with functioning monetary systems, bitcoin is just too awkward to serve as a payments alternative. But in places where monetary breakdowns have occurred, regular folks may be more willing to put up with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 inherent pitfalls of transacting with bitcoin. And so we finally get to see bitcoin-as-money emerging.That's a good thing.

But bitcoin's popularity in Venezuela is also consistent with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 bitcoin-as-game narrative. When people are desperate to improve cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir lives, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y may have little ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r option but to roll cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 dice. In Run Lola Run, Lola needs to quickly make 100,000 Deutschmarks to save her boyfriend's life. She races to a casino and plays roulette. Likewise, in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 face of societal collapse,  Venezuelans may simply be gambling on whatever potentially life-changing bet cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y can find. Bitcoin is one such a bet. Unwinding what portion of Venezuelan usage is due to bitcoin-as-game versus bitcoin-as-money is tricky.

Coinbase goes on to spout cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 typical cryptocurrency industry nonsense about legacy payments. It claims that "sending an international wire transfer by major US banks costs around $45, can take days to process, and can be done only during banking hours." And here is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 chart it uses:

Source: Coinbase

That may be a good critique from ten years ago. But with SWIFT gpi having rolled out a few years back, multinationals can make near real-time cross border payments using cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 traditional correspondent banking system. For individuals and small businesses, fintech Transferwise offers instant remittances over fiat rails. These can settle on weekends in nations like cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 UK, which have real-time retail payments systems. I've touched on this before.

Continuing along with hyperbole, Coinbase makes cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 claim that bitcoin remittance fees are minimal compared to fiat. But this ignores cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 sizable foreign exchange fees that one must pay when converting fiat into bitcoin and back into fiat. I've gone into this calculus before.

What's next for Bitcoin? asks Coinbase in closing. Let me give it a shot. It's possible that bitcoin-as-game will stay popular for a very long time. And if it does, that could be a good thing. As I've suggested before, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re is a demand as-such for financial games and bets, specifically early-bird bets. Compared to many of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 fly-by-night games out cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re, bitcoin provides a fair and trustworthy option.

What about cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 original vision that got us all so excited, bitcoin-as-money? Crippled by bitcoin's game-based engine, bitcoin payments are probably never going to move beyond cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 niche role that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y currently occupy. That's better than nothing. When those on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 fringes are temporarily cut off from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 conventional payments system, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y'll always have an option for making transactions. It might not be a user-friendly option, but at least it's cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re.

25 comments:

  1. I see what you're saying.

    Would it be correct to summarize this post as you seeing Bitcoin as a finite digital resource, which can be transacted with anyone around cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 world and nobody can stop those transactions?

    And cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 "game" is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365refore people trying to figure out how much this resource is worth? Like some sort of market?

    ReplyDelete
    Replies
    1. You would be incorrect to summarize this post as "Bitcoin is good."

      My takeaway is that game is that each individual know cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 resource is not worth much but cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y are incentivized to pretend / predict that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 resource is worth a lot.

      A historical example would be:
      https://en.wikipedia.org/wiki/Tulip_mania

      Delete
    2. The author makes a strong case for it's value.

      "...it can't be regulated or shut down. And so it can serve cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 entire globe with impunity."

      This may be worth more than "not much".

      Delete
    3. Jeff, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 game involves trying to get into ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r players' heads to determine if (or when) cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y will buy. Bitcoin's openness and censorship resistance means that more people can play than would ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365rwise be cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 case.

      The ability to use bitcoin for payments is something that emerges from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 fact that game players have given bitcoins a positive value in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 first place. But game play will always stop cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 payments function from getting much use.

      Delete
    4. I don't believe anyone who has read Satoshi's writing would see any intention for Bitcoin to function as a game, but as a solution to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 centralization of payment transfer.

      Would you say that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 "game" is a side-effect of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 limited supply, or more that Bitcoin was designed to be a game from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 start?

      Delete
    5. I see what you did cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re :)

      Delete
    6. Greg, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 fixed money supply has nothing to do with it. The only reason that bitcoin is worth $9000 is because cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 current generation of players is gambling that anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r generation will pay more, which is gambling that anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r generation will pay more, which is... Bitcoin is a recursive, self-referential guessing game that stops when no one wants to play anymore.

      Delete
    7. JP Koning,

      I think your cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ory of bitcoin as a game would be reasonable if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 asset had no utility.

      Delete
    8. I think he meant as a trading asset. I bought 25 eth, I never bought Bitcoin because I saw it only as a means to get more [quantity] of money.
      Bitcoin was intended to solve a problem that no longer exists, however cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 culture, infrastructure, and investment into Bitcoin is still cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 root of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 cryptoworld.
      We, as human beings, simply can't sit back and rest on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 laurels of a digital currency made to fix a problem that no longer exists.

      The cryptocurrency Chia by brian cohen, if he pulls cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rabbit out of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 hat, will alter cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 game so completely this discussion will become moot.

      Chia is designed to get rid of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 infrastructure part of Bitcoin. No more chinese electric computer farms, still digital money. That's cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 dream at least, and that is P U R E utility.

      Anyone can play World of Warcraft and mail anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r player money in-game. No one cares - it's completely boring, super easy to use, functions instantly. It's only a matter of time that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 same ease with which we can transfer numbers in a game like World of Warcraft becomes closer to what we can do with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 financial system.

      It's cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 software that isn't cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re, not cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 hardware. Most out of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 cryptospace don't have cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 desire to create software that actually works for people for utility.

      The current monetary system was and is going to be outdated for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 rest of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 financial systems existence. I don't think we're ever going to catch up to cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 level of utility that we can already bring to bear in a game.

      People simply take money too seriously. As more and more people realize this, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 technology will continue to emerge that supports simple, effective systems that allow people to use money instead of money using cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365m.

      Delete
  2. Bitcoin is worth nothing, because it's backed up by nothing. But same goes for fiat currency, it's not backed by gold or any ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r resources. It's just monopoly money, out of funds? Print more.

    So cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 author is delusional, you can't compare fictional money with fictional money.

    ReplyDelete
    Replies
    1. For (many) fiat currencies, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 backing of an entire country with no interest in seeing cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir currency become worthless. That's often quite some serious backing and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y have a lot of power cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y can bring to bear on it.

      Delete
    2. Yep, anon @7:55 is right. Banknotes are issued by a central bank. Central banks have huge amounts of assets that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y can use to enforce cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 value of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365ir banknotes. There is no bitcoin central bank. The only thing anchoring bitcoin's price is what ocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365rs are willing to pay.

      Delete
    3. Good assessment overall. Except that -
      Poker, lotteries and especially sports betting are regulated, but only a small portion of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365m. Most sports betting online has been around for decades, long before it was made legal in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 USA by cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Supreme Court this past year. And, you can bet with crypto.
      All kinds of money is played by all kinds of people in all kinds of ways since cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 beginning of time.
      And,just because a tool (currency) is not used for its' "preferred" purpose doesn't mean it won't be at some point.
      Nothing, even monetary policy stays cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 same.

      Delete
  3. The mistake cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 author of this blog makes is thinking that capitalism is long-term sustainable in its current form and that what happened in Venezuela can never happen in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 first world. When cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 US dollar begins to lose its value and it is a matter of when and not if, you can bet your ass that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 type of gambling you are referring to above will happen cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re and everywhere else cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re is a monetary crisis. The genius behind "bitcoin as money" is that over time it proves to be much less of a gamble than trusting in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 printing press economics of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Federal Reserve.

    TL;DR - The two aren't mutually exclusive. Bitcoin as money solves cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 problem is claims to solve precisely because cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 current banking system is doomed to fail everywhere, every single time.

    ReplyDelete
    Replies
    1. If cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 liberal order collapses, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365n yes, bitcoin would be quite useful. Even though it is crazy volatile, it would be cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 best of all options given that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 traditional financial system would have collapsed.

      But if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 liberal order collapses, we may also no longer have cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 sorts of infrastructure necessary for bitcoin to work. Bitcoin needs computers, smart phones, processors, cellular networks, etc.

      Delete
    2. What about a depression instead of a collapse (assuming a collapse is something worse than a depression)? Phones can last plenty long past cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 standard two-year upgrade cycle. Desktops and laptops can usually last about five years. Cellular networks might be a bit precarious, but one would think cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 government, at cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 very least, would seize control to keep that critical infrastructure from collapsing.

      Delete
    3. Like cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Great Depression? I mean, cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 economy suffered through cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Depression but cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 international banking and payments systems continued to work fine.

      You need a much bigger breakdown than that. Not only do we need a massive contraction in GDP growth. But also regional and global war, armed civil conflicts in developed countries, liberal democracy replaced by illiberal dictatorships with a tight surveillance apparatus, widespread ethnic cleansing, etc.

      Delete
  4. The thing that fooled us all for a while, myself included, is that we all thought bitcoin was solving a monetary or payments problem. It was labelled a coin, after all, and coins fall within cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 realm of monetary economics. To furcá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r complicate matters, Satoshi told his story using phrases like "electronic cash system" and "non-reversible transactions". Perhaps we deserve to be forgiven for not seeing bitcoin's underlying nature.


    The above is your conclusion and your opinion - it is not fact. You have just 'made up' this underlying nature! How many people agree with this? I would hazard a guess as not many...


    A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r without going through a financial institution.

    The above is taken from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 1st line of cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Bitcoin whitepaper - if I may beg your forgiveness for continuing to interpret this 1st line as it reads and not your own racá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r random cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365sis on chain letters.

    Rob Dyer

    ReplyDelete
  5. I found this article provided an insightful and interesting perspective. I am happy to have discovered your blog from a link on cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 Monevator site.

    ReplyDelete
  6. Your content is smart and useful JP. Any chance you could make it shareable by adding social share buttons to your posts? Maybe an email sign-up box would be great too.

    ReplyDelete
  7. I dismissed cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 attempt to describe bitcoin as a currency from cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 outset -- it seemed to me that it behaved more like a commodity.

    Your description of it as a game token is much better, thanks.

    ReplyDelete
  8. I think cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 mistake you make is trying to analyse bitcoin as a "currency" (most saleable medium of exchange). Bitcoin cannot be that today and may never be in most countries.

    Bitcoin value proposition is being cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 medium of exchange with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 lowest cost of storage available. It improves on gold being digital and it improves on debt because it has no third-party risk.

    If you need to keep a balance to fund production you have 3 options:
    - Fiat currency. It's eroded relative to total wealth at a pace equal to CPI + Growth.
    - Investment. You may be able to earn a return equal to CPI + Growth + risk_premium, but you need to be willing to assume that risk.
    - Fixed supply asset (BTC). The only risk comes from changes in its demand to keep cash balances for cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 future.

    As demand for a fixed supply asset to keep cash balances grows, its volatility gets lower and fits cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 preferences of more people to keep cash balances. This is a virtuous cicle increasing demand, as demand for a low risk non volatile asset is greater than for a risky one.

    Bitcoin will only have a chance of becoming a currency (generally accepted) when most people demand it for cash balances, and this will only happen when its volatility gets much lower. Judging its adoption by this metric is not correct. Adoption and utility as a medium of exchange (with a time component) can only be judged by its demand (market cap). Acceptance as means of payment may never happen as fiat currencies are pretty good covering that use case in most circumstances.

    There is not much value to be created in reducing white market payments friction, but cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re is a lot of value to be created in reducing cost of storage to maximize future purchasing power of our specialised production.

    ReplyDelete
    Replies
    1. "As demand for a fixed supply asset to keep cash balances grows, its volatility gets lower and fits cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 preferences of more people to keep cash balances. This is a virtuous cicle increasing demand, as demand for a low risk non volatile asset is greater than for a risky one."

      It is unlikely that this virtuous circle will ever be entered into. A different virtuous circle has predominated up till now, and will probably continue to dominate. Volatility stays high, so no one holds it as cash, so game players dominate, so volatility stays high. That this process is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 dominant one is consistent with cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 observations that cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 volatility of crypto remains high even as it becomes more popular, and cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 repeated failure of bitcoin, bcash, xrp etc to break through as a mainstream payments option.

      Delete
    2. We are still orders of magnitude away from target valuation for a trust-minimized fixed-supply asset. There is still more capital invested even in investment gold (mostly-trust-based and with 2% monetary inflation).

      Don't expect volatility to get get much lower when price is in its way to grow anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r 2 or 3 orders of magnitude in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 next few years. We are not cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365re yet, and this is not as gradual as you may imagine.

      Don't expect it to become a mainstream payments option until demand for cash balances in bitcoin are mainstream. Mainstream payments adoption may never happen even cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365n, for most people apple pay is almost frictionless and very difficult to beat to buy a coffee. Mainstream payments is cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 wrong metric to look at.

      Delete
  9. Hi JB, this comment doesn't relate to this particular article but instead anocá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365r one you wrote 2 years ago regarding T+0 cash settlement. My question: Is T+0 really gonna be that much of a pain in cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 ass to brokers? Is it because those securities have to be delivered physically? I am far from an expert but if cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 shares don't have to be physically delivered than why can't cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365y just send cá cược thể thao bet365_cách nạp tiền vào bet365_ đăng ký bet365 shares electronically to a brokerage firm instantly as soon as a transaction is made? Thanks in advance.

    ReplyDelete