# Why should I invest into cryptocurrencies?



## Silent_Gunner (Nov 21, 2020)

Now, that might be a clickbait as hell topic title, but hear me out:

I've been hearing about cryptocurrencies being the future and this and that for a good part of the last decade going into today. And while what I've heard about it sounds all nice and rosy, the part that I don't get is where does Bitcoin, Dogecoin, Ethereum, Pepecoin, XRP, and probably others I'm not aware of derive their value from?

For example, the currency we have here in the US is Fiat-based, meaning it's not based on a gold or silver standard. I get that resources such as cash, coinage, gold, silver, precious metals, etc. are valuable and stuff like that. But those are items that societies have agreed upon to use for a very long time, and you still need those first two aforementioned things for if one wants to get items from vending machines that don't get card readers or any support for stuff like Samsung, Apple, or Google Pay. If people were trading these things in society right now, they at least would have a use for it.

The thing I don't personally get about cryptocurrencies that has me all confused is that there is no physical good being traded; it's all digital, and supposedly, "private, and free from someone breaking into your bank account, etc.," even though I've heard of cases where these claims simply don't hold up. But even then, I still don't understand what makes it so valuable. I know Bitcoin only has so many coins in the digital wild, which, OK, fine, but what about the other ones like Ethereum, XRP, Brave Rewards (which IDK if that's a cryptocurrency, but I know Chris Titus Tech apparently said he earned money from it or something), and the others? If I was to pay my Dad in one of these cryptocurrencies for, say, a couch in the living room, given his age and his relative lack of understanding of how to operate even a computer and smartphone at times, it would be of no use to him. I'd have to pay him in cash, or write him a check. Now, if I was trading with someone who understood and has utility for that kind of transaction, then there should be no problem afaik.



This post is all over the place, but I guess I just don't understand what crypto derives its value from right now, and I'm kind of looking to discuss this with those more in the know.


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## jimbo13 (Nov 21, 2020)

Silent_Gunner said:


> Now, that might be a clickbait as hell topic title, but hear me out:
> 
> I've been hearing about cryptocurrencies being the future and this and that for a good part of the last decade going into today. And while what I've heard about it sounds all nice and rosy, the part that I don't get is where does Bitcoin, Dogecoin, Ethereum, Pepecoin, XRP, and probably others I'm not aware of derive their value from?
> 
> ...




You shouldn't IMO,  I'd put a little in Crypto as in a little more than I'd spend on lottery.  Crypto is gambling still, it's volatile.  High risk high reward and institutional banking/governments are getting ready to attack and get their cut.

Top two: Real estate > Precious metals (silver imo).

There is a fine line between gambling and investing imo.  If you like the high risk/reward and can dig deep to make good choices enjoy the rush when it hits.


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## FAST6191 (Nov 21, 2020)

Gold, silver, and such are not especially valuable either. Just valuable because human like shiny and shiny thing not common to dig out of ground/pan in river. Give me enough gold to build bricks for my house and I will still pick other things as superior materials, not much use for eating, not much use as a catalyst (platinum is I guess), not bad a conductor coating and possibly for oxidation prevention...
That is also before we cover how diamonds are, relatively speaking, common as dirt and it is only because the main sources of such things are kept in tight check by a cartel that sticks things in a vault to keep supply low, not to mention we can grow them these days for potentially about as much in energy cost as the cartel prices.

US currency is then mostly valuable because it is what the US government accepts for tax purposes. Try not paying taxes in the US and boys with guns turn up, enough that you will have a hard time outgunning or outrunning. A few million people then having to pay taxes mean they need what the taxers accept, which these days just so happens to be US Dollars (that they also control, manipulate and constantly raise* the rates on). Said might also goes out to the world as well, along with a lot of tech and cool stuff that others want to buy, and US currency is useful in that too, also for reasons unknown is what oil is largely priced in and oil is kind of a big deal.

* so your tax brackets changed and now you get to earn $15000 rather than $14000 before you pay 20% of whatever you make above that or whatever the numbers actually are. If you calculated the raise and compared it to what the rate of inflation (which your job hopefully kept up with) then that is going to mean you are paying more taxes. No country ever wants to see deflation either (nobody will spend more than the minimum in that scenario) so they will keep inflation high.

As far as very long time. Most currency around today is relatively new as these things go (hard for me to spend shillings and tuppence around here, this despite me being able to speak to people that remember it well).
Also most conventional currency is not a physical thing and has not been for years -- see fractional reserve banking.

Your dad would presumably also struggle to accept land deeds, bearer bonds, a stock portfolio, stock in general. Still count as valuable assets to your divorce lawyer, estate lawyer, tax man in those places that tax you on owned items rather than income...

Crypto can't necessarily be stolen in the same ways that people steal credit cards. Things you hear about are either key loggers on computers, traditional pay us or we end you, those leaving it with other services (see exchanges) and them being hacked and general not what we said it was scams. They do also have some perks that those operating in the normal banking system don't have -- transfer varies depending upon type but it is very fast indeed compared to traditional transfers, cost of transfer is also often minimal (bitcoin did take a rake a while back compared to once being free), transfers are hard to track as well (they are not necessarily anonymous and there is also the tumbling thing) which makes them good for buying drugs and gambling and illegal services and evading tax, or transferring funds when your government (not all are nice after all, and some might try to tax you on it**) would rather you didn't.
There are "legit" things to use it on as well (just as you can barter or accept foreign currency then you can accept crypto), though even without that underground economies are still economies and can be measured.

**when countries and companies/banks run low some might take "haircut" on simple withdrawals. If you are instead buying crypto then you can dodge that, or even better if you kept it in it to begin with.

The other side of why you were probably told to invest by some is because the rate of exchange change is insane. A swing of a normal currency to 2:1 what it was at some point in the previous year (that is to say you converted 100 USD into 100 EUR a year ago but today you can convert it back to 200USD) is an insanely good return and super rare (normally only massive wars, government collapse or gamechanger technologies that cause such spikes). 2:1 in crypto is nothing, depending upon your timeline then it is thousands to 1.
https://en.bitcoinwiki.org/wiki/Bitcoin_history#Bitcoin_price_chart_since_2009_to_2017_and_2018
Or if you prefer in early 2011 it hit 1 USD per bitcoin (was messing around sub 10 cents for a long time before it).
Today it varies a bit and many are waiting to see it hit $20000 USD ( https://www.coinwarz.com/prices/bitcoin/chart says  $18,656.796600 though), or 100 USD and forget about it back in 2011 would today be 1.8 million, even more back at the previous peak. No investment portfolio, stock or wall street fund has come even within sniffing distance of that kind of return, never mind something that mere mortals can buy in for $100. Its falls however are equally considerable.
We can cover mining as well if you want -- the way these things work is a so called distributed ledger. Here every previous round of transactions (varies between types but 15 minutes is on the high end) gets added and then the new round begins, however as the network should theoretically consist of several thousand computers all working against each other then nobody can disagree with the distribution of the coins in given addresses and nobody can take over. To get this group of computers burning bandwidth and electricity they are rewarded for participating in a basically lottery wherein the solver of a problem that is pretty much brute force computing power gets a few coins of their own and a cut from the transactions that happened. People can pool resources, design better solvers, move places with cheap electricity (to both run and cool the things) and so on.

There are other crypto methods that do other things. Smart contracts being one of the more notable. Here if I promised to build a shed for you down the pub then it is a word between gentlemen (which nobody has ever confused me for). We could get lawyers or notaries to sign it and whatnot but that is effort. Smart contract does much the same thing so when you drag me to court you can point at the thing saying his key signed this agreement and the judge would then have to be all "so it is, pay the man" and that is just the tip of the iceberg for that one.


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## WiiCurious (Nov 21, 2020)

> There are other crypto methods that do other things. Smart contracts being one of the more notable. Here if I promised to build a shed for you down the pub then it is a word between gentlemen (which nobody has ever confused me for). We could get lawyers or notaries to sign it and whatnot but that is effort. Smart contract does much the same thing so when you drag me to court you can point at the thing saying his key signed this agreement and the judge would then have to be all "so it is, pay the man" and that is just the tip of the iceberg for that one.



Cryptocurrency is so fucking stupid.
I have no doubt that there is money to be made, but stop pretending the technology is worthwhile.

The idea that smart contracts would ever be upheld in a court of law is horrifying.
Some downsides:
Somebody gets access to your phone/computer and signs your private key to a contract that gives them all your assets.
A bug is discovered that makes the smart contract pay out without services being provided. (This happens all the time now. If smart contracts were widespread, it would be happening daily)
Widespread grid failure that makes internet or electricity scarce would mean you don't have to fulfill any obligations of a smart contract.

The current system might not be great, but at least contracts aren't controlled by neckbeards.

Also consider assets stored on the blockchain. I have a title for my car in a safe. As long as I have the title, I own the car. Now imagine my title in on The Blockchain. The Chinese miners that control the blockchain can conspire and transfer the title to themselves. Or somebody could compromise my computers and accounts and transfer the title to anybody. Same for the deed to property.
I would never put my assets in the position to be taken away by the Chinese government or some teenage hacker.
Banks are great because there's fraud protection and deposit guarantee. FDIC and NCUA in the US protect your money from malicious actions.

Cryptocurrencies are also an environmental disaster where the system rewards more and more waste. By design, the math necessary to 'mine' bitcoins cannot be productive. It will always just be computers jerking themselves off until they find a number with enough zeros.

Also, smart contracts and other aspects of the blockchain can be utilized using tiny fractions of a bitcoin. The idea that one bitcoin is worth more than 1/1000 of a bitcoin is strange, as the fraction has exactly the same functionality as the whole in terms of technology. Why is 1 bitcoin worth $18,000 USD when .000001 bitcoin can be used to do all the same things on the blockchain? Bitcoin only makes sense as a token without value.

In summary, the technology behind bitcoin is stupid, the valuation of bitcoin is being propped up by billions of unbacked tether, and we should continue to mock british people behind their backs.

You can probably make money by daytrading in crypto, but you are gambling and the house always wins.
Exchanges are unregulated and super shady. They can see sell order, buy orders, and shorts. They have the ability to manipulate the price to break shorts or raise the price of bitcoin as they see fit. They cannot lose.

Bitcoin went above $1000 for the first time because Mt. Gox was wash trading bitcoin. It cost them less than 5 bitcoin to rocket the price to those levels.
This is still going on. No laws are in place to prevent it.


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## Deleted User (Nov 21, 2020)

on the topic, currencies that one could profit from mining with a single 1060?


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## jimbo13 (Nov 21, 2020)

Azerus_Kun said:


> on the topic, currencies that one could profit from mining with a single 1060?



Nothing anymore, a 1060 is garden shovel in a world of industrial farming.   You can join a with others and get a cut they basically slave you in too their server farm.

True story, my Warcraft guild back in the day buddy hopes on Ventrillo:    Hey guys you want to do this Bitcoin thing with me?  If you get one there worth a few dollars and we all have the rigs.

Nah fuck that, sounds like a scam and I don't want to stress my hardware.


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## Silent_Gunner (Nov 21, 2020)

jimbo13 said:


> Nothing anymore, a 1060 is garden shovel in a world of industrial farming.   You can join a with others and get a cut they basically slave you in too their server farm.
> 
> True story, my Warcraft guild back in the day buddy hopes on Ventrillo:    Hey guys you want to do this Bitcoin thing with me?  If you get one there worth a few dollars and we all have the rigs.
> 
> Nah fuck that, sounds like a scam and I don't want to stress my hardware.



Usually, people have separate rigs for mining as far as I understand.


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## kosterix (Nov 21, 2020)

Right now investing in btc or derivs is a bad idea. Last time it hit 20k it plumbed. Save some money from today onward, to invest in btc later when it has dropped.

US currency is 99% debt, and if you expect currencies to hyper inflate buy things that hold their value, such as limited edition video games, or board games. 

Gold is too volatile, but it takes up less space under your bed, if you can sleep allright.

I sell when btc rises and buy when it drops below a certain point. In the end I win, but it's at most 400 dollar per year, more for fun than actually make a living.

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WiiCurious said:


> Cryptocurrency is so fucking stupid.
> Somebody gets access to your phone/computer and signs your private key to a contract that gives them all your assets..


You have never heard of 2FA?


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## Silent_Gunner (Nov 21, 2020)

kosterix said:


> Right now investing in btc or derivs is a bad idea. Last time it hit 20k it plumbed. Save some money from today onward, to invest in btc later when it has dropped.
> 
> US currency is 99% debt, and if you expect currencies to hyper inflate buy things that hold their value, such as limited edition video games, or board games.
> 
> ...



I mean, that strategy could also be applied to the stock market too, right?

Also, I know it's not a good idea to invest atm. The US election being contested like it is and the implications of either candidate winning is going to affect the market in a big way. I'm going to be doing a lot of saving going forward after I get out of the debt hole!

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kosterix said:


> --------------------- MERGED ---------------------------
> 
> 
> You have never heard of 2FA?



2FA, like all locks, can be picked.


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## FAST6191 (Nov 21, 2020)

WiiCurious said:


> Cryptocurrency is so fucking stupid.
> I have no doubt that there is money to be made, but stop pretending the technology is worthwhile.
> 
> The idea that smart contracts would ever be upheld in a court of law is horrifying.
> ...



Are any of those not already problems with currently done computing (we have had digital signatures of various forms for years, now, indeed PDF has such functionality)?
Grid and internet failure would grind things to a halt regardless. Not sure why I would plan for that or particularly care.

Contracts may or may not be controlled by neckbeards, but I can't say I care for lawyers any more than them. At least neckbeards are famously awful salesmen.

"that control the blockchain"
Possible, but so is you deciding one morning to gift it (or sell for a dollar if gift tax is a thing). Both seem about as likely.

I am not following with the fractional thing. If the network only understands transactions then you initiate a transaction to note it within it, not entirely unlike sending an email to yourself, whether for bare minimum or more will vary with what you want. 

As far as market manipulation. Sure. Same as everywhere else.


Silent_Gunner said:


> 2FA, like all locks, can be picked.


Ease of use and security afforded. Most things are a trade off between the two, usually tempered by how much you have to lose.
Bits of paper work until your house burns down, floods, gets stolen and you also have to go fetch it if you need it.


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## WiiCurious (Nov 23, 2020)

FAST6191 said:


> I am not following with the fractional thing. If the network only understands transactions then you initiate a transaction to note it within it, not entirely unlike sending an email to yourself, whether for bare minimum or more will vary with what you want.



Say you write a contract. The only way to make this contract valid and binding it to email it to the other party. By emailing it, the contract becomes a smart contract.

If the contract is 100 pages long, it can still fit in one email. If the contract is 1 page long, you can still fit it in an email.
No matter how complex the contract, it only takes one email to make it enforceable.

You can make a contract with one shitoshi. That's all it takes to get your smart contract on the blockchain. If the only value in bitcoin is its ability to act in smart contracts, there's no need to own more than 10 or so shitoshis. How many contracts does the average person enter into? Not very many. 

The desire to own thousands of shitoshis is nonsensical. One bitcoin has the same function as 1/1000000 of a bitcoin.

Going back to my first paragraph, it would be like sending hundreds of emails when you were trying to create an important contract. If it only takes that one email to make the contract legit, why send more than one?


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## FAST6191 (Nov 23, 2020)

But the only value in bitcoin (or an altcoin with an actual focus on smart contracts) is not in contracts, there is the store of wealth/investment, means of payment, other perks of the same means of payment...

"How many contracts does the average person enter into?"
World changing affairs that determine the course of not only their lives but those around them? Probably not so many. Reduce it to the level of transactions (say using a taxi in the thing above, simple purchase of an item) or for work done, both of which are possible as cost is arguably less than the paper the average receipt is on, and that is a different matter entirely.


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## mariopepper (Nov 23, 2020)

Probably because it's 21st century and most people think it's the currency of the future. Moreover I agree. I also have some btc which I've bought back in 2012 and now you see the final price. Profit. Don't forget that you might need additional equipment for investing.  First of all it's trusted bitcoin wallet. Personally I use https://bitcoinofficial.org/ since my first cryptocurrency purchasing. Secondly you should analyze the market and predict its next positions and prices.


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## ClancyDaEnlightened (Nov 29, 2020)

Crypto is an investment, it's also decentralized, there is no central bank or authority, its a financial system based around cryptography and peer to peer networking, it can be difficult to track who and where  and what is being purchased


IMHO Crypto took off because people can use  it to buy cheap (quality) drugs and conduct other illicit business anonymously........ I don't think Crypto would have it's value without the laundering ability


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## FAST6191 (Nov 29, 2020)

aadz93 said:


> IMHO Crypto took off because people can use  it to buy cheap (quality) drugs and conduct other illicit business anonymously........ I don't think Crypto would have it's value without the laundering ability



A value (potentially overinflated as it is) or as much value?
There are still plenty of entirely legitimate uses and problems it solves, lessens or negates -- speed and ease of high value transfer being but one of them (a while back my friend wanted to transfer £20k or so to their partner, was easier and cheaper to get a briefcase of cash in 2 days time, walk it 50m up the road to the other bank and pay it in, this is in the UK and both of them are well versed in finance). 15 minutes and did not have to leave the sofa should it have been done via crypto, though I guess it did not come with a sweet briefcase.

Did not having to do awkward arrangements on private invite only forums act as the equivalent of porn in the VHS-betamax wars and online credit card purchases and video streaming a few years down the line? I would not bet against it. Almost certainly boosted its prominence.


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## mariopepper (Nov 29, 2020)

aadz93 said:


> Crypto is an investment, it's also decentralized, there is no central bank or authority, its a financial system based around cryptography and peer to peer networking, it can be difficult to track who and where  and what is being purchased
> 
> 
> IMHO Crypto took off because people can use  it to buy cheap (quality) drugs and conduct other illicit business anonymously........ I don't think Crypto would have it's value without the laundering ability


I don't think so. Probably crypto is just a bigger and more valuable method of payment. There is no alternative of crypti which you can take in your hand. It's absolutely "imaginable" coin which you can't lose in the street etc. I also can mention bit IT-companies who use crypto more often every year. It's the currency of the future


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## ClancyDaEnlightened (Nov 29, 2020)

It's also a perfect way of sending money instantly, without a bank, there are plenty of legitimate uses....

But if people couldn't use crypto to clean (dirty/stolen) money, and to get illicit things, I don't think it would be at almost 20 grand us dollar valuable


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## WiiCurious (Nov 29, 2020)

aadz93 said:


> It's also a perfect way of sending money instantly, without a bank, there are plenty of legitimate uses....
> 
> But if people couldn't use crypto to clean (dirty/stolen) money, and to get illicit things, I don't think it would be at almost 20 grand us dollar valuable



Instantly? Can't it take days to get a transaction in a block if you're not willing to pay $20+ USD transaction fees?


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## ClancyDaEnlightened (Nov 29, 2020)

Depends on network load, my transactions usually confirm within an hour, I use between 30-60 satoshi/byte 

So about 2-3$ for it to confirm 1-2 times in about an hour or so depends on how many confirmations you need


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## notimp (Nov 30, 2020)

What a load of half knowledge and halftruths.. 

Value is based on demand, currently largely driven by two factors. Capital flight from regions where exchange rates are horrible or governments want people to invest into generating a local goods market instead of exporting - and financial speculation.

Also the need for anonymizeable online transactions (crypto in itself is not anonymous, but as with amazon gift certificates, you can 'wash' it for a fee (no state regulator)), but to a much, much lower extent.

So you add up taxfraud to darknet deals to pump and dump schemes (a few players coordinating buying and selling large quantities, getting people excited that 'with those value gains, there is money to be maid', then dumping their shares within one day - crashing value, but getting new suckers investments), to fraud, and you've got the appeal. Add some bogus story about 'truly libertarian and free', and start grifting.

This is not the way most of it was initially imagined, but the way it turned out.

On 'libertarian and free' and 'anonymous' if you have the more than 2/3 of 'transaction validation capacity' split between 5 players - none of the above.

On 'money' - if your transaction capacity is 10.000 transactions per second, and your claim is 'for worldwide use' - none of the above (you are waiting days for your transactions to be verified, during which there is risk of doublespending, so nothing moves until verified). 'Pay more to get faster' also only works to an extent.

On 'so safe!' - if you can scam people into handing over their wallet keys to large aggregators - because they dont understand what they are doing. Chance of 'one day aggregator owner heads for Bali and tries to fake his death' is 1:10.

On 'gift to the world' no - its all about being the middleman, or (in the facebook case) even being allowed to change the contract of what the stuff is, mid use.

On 'the future, because more easy' - there are businesses around aggregating and selling purchase histories, there is an interest in being able to inflate the value of currency currently in circulation, which is only used for daily transactions and not for structural investments. (Meaning negative interest, that doest ruin businesses, only private people.)

On 'smart contracts' - there are very few scenarios, where a company would want to be more transparent towards a business partner or customer, and would forgo being 'the one in charge of managing a transaction' if it could. (Example, you are a logging company. You've scammed your customers for years, youve created quasi monopolies, you've lost delivery slips. You've backdated. You've split hauls, when the customer wasnt looking. Now you want to make your business end to end transparent? Why? Example. You are a banking firm, you've managed transactions, you've sold yourself as 'the intermediary people can trust' now you want your business model to end? Why?

On 'inter back exchange systems' sure, why not. Transactions can be made more efficient.

On 'every transaction is public' - you are a country. Are you sure you want that?

On 'no state intervention in principle' - you are a country. Are you sure you want that?

On 'digital transactions' in crypto - you lose your phone, you never remembered number, you lose your money, are you sure people understand?

On 'solving the low transaction per second problem' (and the energy consumption problem). Any solution always (?) seems to move towards more centralization on the verification front. Verification is where people generating currency make money. Great?

The answer is - there is something there. Currently its very much a solution in search of a more lucrative problem. The problems its currently solving arent big enough for any of the big players to be interested in 'established solutions'. Coming up with your own solutions? Sure - when that means, that you can be the intermediary for other peoples transactions. Do nothing, get paid. Still, there is something there and at one point Facebook (Libra) or your state mint will 'ram it down your throat', because they see in it the opportunity to 'jump the competition in evolutionary terms' (Late to the party and no idea whats going on? Look for the next hot thing, while trying to replicate alipay!). But whatever 'that' is, is bound to have little to do with Bitcoin or derivates in the first place.

If that all sounds horrible to you - most peoples deliberation process goes exactly as far as: IT HAS DOUBLED IN VALUE IN LESS THAN A YEAR? WHAT ELSE HAS DONE THAT THAT I CAN INVEST IN. IN MY LIFETIME. NOTHING? WELL, I THINK I MIGHT BE INTERESTED. WHAT IS BEST?

And this thread is no exception.


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## The Real Jdbye (Nov 30, 2020)

Silent_Gunner said:


> Now, that might be a clickbait as hell topic title, but hear me out:
> 
> I've been hearing about cryptocurrencies being the future and this and that for a good part of the last decade going into today. And while what I've heard about it sounds all nice and rosy, the part that I don't get is where does Bitcoin, Dogecoin, Ethereum, Pepecoin, XRP, and probably others I'm not aware of derive their value from?
> 
> ...


Every cryptocurrency has a limited supply and coins can only be generated so fast (usually limited by the raw processing power of all the hardware miners at any given time)
The value is very closely tied to the current difficulty of mining (for the coins that employ "proof of work") and the remaining supply of unmined coins, and the difficulty goes up with every successful mine.
It also varies widely based on public (and private) interest.

If you choose the right time to invest, you can make big earnings, far bigger than you usually see with more traditional investments (i.e. stocks) simply because of the higher volatility of it, due to it not being backed by the success or monetary value of a business.
That also means that conversely, you can easily lose everything if you invest at the wrong time.

Now seems to be a good time to invest, with the current boom and even PayPal now supporting cryptocurrency directly on their website (but earlier would've been even better), and the rise in value doesn't show any signs of stopping soon.


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## notimp (Nov 30, 2020)

The Real Jdbye said:


> Now seems to be a good time to invest, with the current boom and even PayPal now supporting cryptocurrency directly on their website (but earlier would've been even better), and the rise in value doesn't show any signs of stopping soon.


Says every person already invested. 

For the rest of your posting - thumbs up.


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## The Real Jdbye (Nov 30, 2020)

notimp said:


> Says every person already invested.
> 
> For the rest of your posting - thumbs up.


I didn't have the spare money laying around to invest this time around but a friend invested big right before all of this started. I've made a decent (2.5x) return on Bitcoin earlier this year though.

But yeah, you are right, most people interested in cryptocurrency have already invested, and the best time to invest has already passed. Personally I don't see it stopping before it's reached at least 30K based on past trends (and that's a rather conservative estimate, comparing to what some other people are saying), but I'm no expert nor do I claim to be one.


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## notimp (Nov 30, 2020)

The Real Jdbye said:


> I didn't have the spare money laying around to invest this time around but a friend invested big right before all of this started. I've made a decent (2.5x) return on Bitcoin earlier this year though.


I mean structurally.

'Paypal now invested!!11!' Just means the same as 'China now invested!' the same as 'Big banks now invested, because they simply cant ignore it any longer!'.

Nothing changed fundamentally. Transactions (buy in) have become more easy for more people. Which means the promise of more suckers soon! Which means, value will rise! Get in, while its hot.

Also the promise of 'at one point, if enough people have bought in, it will stabilize exchange rates (currently driven by pump and dump schemes), because more people have interest in value stability over making a quick buck).

But nothing changed fundamentally - all the problems are still the same. (But I guess, they also are with gold. For centuries. Its just, that there arent 100 golds out there that are used for pretty much nothing but speculation and value storage in case your country just goes through hyper currency devaluation. But now with the advent of digital, there are.  )

The thing is, if you make it 'mo easy' and find more suckers, even the suckers can become heroes - if more people buy in.

And with interest rates currently at 0% for most people in western economies, this sounds more and more enticing to more people. And I cant prevent them from 'going out to find their luck' - because, you risk some, you loose some - but hey, maybe you get lucky - one more time. Vallue still doubled from 'one point this year' to 'another point this year'.


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## Silent_Gunner (Nov 30, 2020)

The Real Jdbye said:


> Every cryptocurrency has a limited supply and coins can only be generated so fast (usually limited by the raw processing power of all the hardware miners at any given time)
> The value is very closely tied to the current difficulty of mining (for the coins that employ "proof of work") and the remaining supply of unmined coins, and the difficulty goes up with every successful mine.
> It also varies widely based on public (and private) interest.
> 
> ...



Wait, so cryptocurrency coinage is made by the hardware miners themselves? Like, it literally generates a new coin or set of coins from coins the investors already got into? Kind of like dividends? Because the big thing I never quite understood is that, OK, so Bitcoin, Ethereum, XRP, Dogecoin, etc. all are created by the hardware miners themselves?

If I'm to envision cryptocurrency mining to be like the gold rush in the 19th century in the US, in that gold buried underneath the ground was dug up, discovered, and was held in high regard in society back then, where did these cryptocurrencies come from and who or what made them? That's the part that I've always found to be difficult to wrap my head around.

I know the question sounds of like something out of a creationism vs. evolution or something like abiogenesis debate, but cryptocurrency has a bit more of an immediate impact on the world you and I live in today, and is a bit more relevant IMHO.


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## The Real Jdbye (Nov 30, 2020)

Silent_Gunner said:


> Wait, so cryptocurrency coinage is made by the hardware miners themselves? Like, it literally generates a new coin or set of coins from coins the investors already got into? Kind of like dividends? Because the big thing I never quite understood is that, OK, so Bitcoin, Ethereum, XRP, Dogecoin, etc. all are created by the hardware miners themselves?
> 
> If I'm to envision cryptocurrency mining to be like the gold rush in the 19th century in the US, in that gold buried underneath the ground was dug up, discovered, and was held in high regard in society back then, where did these cryptocurrencies come from and who or what made them? That's the part that I've always found to be difficult to wrap my head around.
> 
> I know the question sounds of like something out of a creationism vs. evolution or something like abiogenesis debate, but cryptocurrency has a bit more of an immediate impact on the world you and I live in today, and is a bit more relevant IMHO.


Bitcoin, the original cryptocurrency, was created by some Satoshi Nakamoto (not their actual name), being decentralized it's effectively hosted by all the miners and the people running the wallet client, and indeed, all the currency is generated by the miners. The original creator has no control over the cryptocurrency once it's deployed (unless they put in a backdoor, but it's all open source and you shouldn't trust any cryptocurrency that's not, there are a lot of scam "get rich quick" schemes out there)
Most cryptocurrencies operate under this same principle, but some, rather than "proof of work" (relying on raw computing power to generate coins) use "proof of stake" (where coins are generated by people holding at least a minimum amount of the currency in a wallet on their PC and they receive dividends based on that, in addition to the price fluctuation), there are probably other types I'm forgetting but those are the most common.


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## tabzer (Nov 30, 2020)

I don't understand @notimp 's pov.  It's hard to keep a speculative position as you see it is finally getting adoption by major banks and businesses.  

Bitcoin, or cryptocurrency, is a hedge against financial systems.  The US dollar, or whatever fiat is bound to suffer inflation.  If you hold onto a dollar, it will lose its value over time.  If you have a long position with bitcoin, it is more likely that you will profit, but who is to say how long is long?  Eventually, bitcoin will become more scarce and scattered, with fewer people having a lot of it; and as that time approaches it's easy to see it spiking again like it did when it first approached 20K.

There is a set amount of bitcoin.  The blockchain is its ledger.  The machines on the P2P network (miners) all work in competition to solve a cryptography equation that has a difficulty determined by the network's strength (or how many computers are actively trying to solve the equaiton).  It's not exactly that a miner mints a bitcoin.  It's that a miner is the first to solve the cryptographic puzzle, and the rest of the network is able to verify that work and acknowledge the address of that miner with the reward, as determined by the protocol that every machine agrees with.  If a bad actor tries to come in and tries to change the rules, the rest of the network will simply reject it due to not being consistent with what everyone else is saying.

The only way a bad actor can really overrule the network, is if something called a %51 attack is done.  That's where 51% or more of the network (miners) decides on new rules, and rejects the old protocol.  The chances of that happening are really slim, as the cost is too great at this point, and the investment to cause fraud with the network would sink the price of the cryptocurrency making the point moot.  People fear that governments might try to do something like that.

I mentioned before that crypto can be a hedge against fiat, but it is also kind of a hedge/ante against state secrets.  Bitcoin relies on sha-256 encryption.  So the moment that is broken, it is time to flee into the jungle.

--------------------- MERGED ---------------------------

People argue that bitcoin is a store of value, a lot.  It's true.  It's fun to trade with too.  But that's very dangerous.  These days, the lightning network and other 2nd layer solutions are making transactions possible via other means... so it is definitely scaling one way or another.  Another point that @notimp  doesn't seem to acknowledge.


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## notimp (Nov 30, 2020)

Silent_Gunner said:


> Wait, so cryptocurrency coinage is made by the hardware miners themselves? Like, it literally generates a new coin or set of coins from coins the investors already got into? Kind of like dividends? Because the big thing I never quite understood is that, OK, so Bitcoin, Ethereum, XRP, Dogecoin, etc. all are created by the hardware miners themselves?


Yes, so the thing you are selling is 'distributed ledger', thats the innovation. For that to happen, you need distributed computing power for transaction verification. So you say - people who verify transactions, 'can pay themselves' by generating currency.

RATE of currency generation is FIXED by the algorithm. (So only disrupted by 'innovation' (so only offset by computing power getting cheaper f.e.). And fixed in a way, that you generate less and less coin as time goes on (presuming it also has become more valuable as more people bought in). But again, rate is fixed. (== No inflation spikes of amount of currency.)

(Theoretical problem - mining may become not lucrative anymore, at which point you have no transaction verification. So at that point you do a 'stage illusion' like bitcoin already did - get a large amount of asset owners together, fork the protocol to make 'verification per cpu cycle' easier. Call the new thing bitcoin again - and most of the people are happy again.)

How do you get the rate to be fixed? Only a small part of computation power is used for transaction verification, the much larger part of the power is used to solve a mathematical equation, with only one solution as 'proof of work' - whoever gets to the solution FIRST, gets to generate currency (and verify a bunch of transactions). Your algorithm baked into the currency makes sure the mathematical problem gets much harder over time.

The algorithm is backed into the 'currency protocol' that is distributed, so it cant be changed. (Unless you fork currency.)

Who makes sure people dont cheat? Basically a consensus of 'enough other people on the verification backend' which also ensures, that all transactions must be transparent.

Also you change the people 'confirming transaction' all the time (ideally), so no single person has to be trusted.

(So most of your innovation is: You standing on a stage shout: "Whats 14x7?" First person raising their hand gets to be the treasurer of your 'club' for 15 minutes. As they cant find out who the next treasurer will be - scheming how to collude to defraud people, becomes harder, also you might want to do a good job, because you get paid in currency. Which means, you dont need a central instance you can trust. In principal.

In practice - computational cots dictate how many transactions per second you can 'pull'. So how useful your currency is as a currency. Also the ledger (sheet of paper with owes vs has of everyone to everyone ) becomes bigger. Also the more people group together in 'verification clubs' buying better hardware, the higher their probability is to actually get to deal with the next transaction in their hub, which allows for certain schemes. Also if you coordinate buying and selling and or generation of money you can drive pump and dump schemes.

Mining profits are a factor of supply and demand with only limited transaction capacity at a time (Fee is negotiable).

edit: Miners are first motivated by 'mined coin mostly', and later more and more by transaction fees (less opportunity to get 'shares of the company'). Maybe. At least in theory.  Thats kind of how startups work in the tech sector..


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## tabzer (Nov 30, 2020)

Oh yeah, if you are serious.  Get a hardware wallet and learn all the ins and outs of it.  Don't trust online wallet generators, as they are only so secure.  (As is your computer). 

Whoever recommended www.bitcoinofficial.org is giving bad advice.  It didn't exist before 2019 and it is a complete joke to get your private/public keys from something like that.  I doubt they were into bitcoin and using it since 2012.  Back then, people were using the main bitcoin official client as the wallet, mining with their cpus/fpgas, and using their bitcoin to play poker online.

It's better to roll dice and generate your own keys with pen and paper than to trust any computer connected to the internet.  Hardware wallets are more user friendly and still very secure.

--------------------- MERGED ---------------------------



notimp said:


> Theoretical problem - mining may become not lucrative anymore, at which point you have no transaction verification. So at that point you do a 'stage illusion' like bitcoin already did - get a large amount of asset owners together, fork the protocol to make 'verification per cpu cycle' easier. Call the new thing bitcoin again - and most of the people are happy again (Already happend with bitcoin).)



If Bitcoin's hashrate decreases, the network difficulty will reduce as well.  I don't know what you are talking about "stage illusion".  Bitcoin has forked before to fix errors, but the method of upgrade is how Bitcoin is supposed to function.  The consensus never gets rejected and never suffers any downtime.


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## Bladexdsl (Nov 30, 2020)

your a fool if you do and your encouraging assholes miners PLUS jacking up video card prices


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## notimp (Nov 30, 2020)

tabzer said:


> I don't understand @notimp 's pov. It's hard to keep a speculative position as you see it is finally getting adoption by major banks and businesses.


Not if they are only playing 'gateway' (exchange/broker). Thats nothing. Thats 'I've made new app, it s so easy to get it now!'.

There are structural limitations for it to be used in everyday transactions. (Would need several 100.000s+ of verified transactions a second. Have 10.000).

There are structural necessities for pump and dump schemes to end. Players interested in it as a 'value storage' must own more bitcoin, than players owning coin, trying to coordinate to manipulate price. With what 75% of the currency being situated in asia and owned by a few major players (electricity cheap, custom silicon production advantage), I'm not sure I care so much if paypal now wants to play currency exchange. (Also making more money, if exchange rates are volatile.)
If there are limits to transaction capacity, that already make it an issue currently, what indicates, that it will ever be a high volume business where people would have more interest in skimming transaction fees than running pump and dump schemes?

"Banks are getting into it". Yes, but - the financial investment arms.  The ones interested in volatility and speculation. 

But again, nothing of this is an issue - if there are still more suckers out there to be had.  If value still doubles at one point over the year (and halves over another period). There is ample opportunity for many people to parttake. 

Also - the moment you decide to push it to 'a population' as 'digital currency' - likely as a state treasury. Or as facebook. You make sure, it has nothing to do with bitcoin. You just spool up your own currency. Out of thin air. Make sure its value is pegged to 'one ore a basket of' 'real currencies' (in demand, because people have to pay taxes in that currency - even if fiat) - and it has NOTHING to do with the bitcoin market.

(By then it probably also wont be (edit: 'sufficiently' (as in players cant coordinate)) decentralized anymore. But again, that has little value to most 'stakeholders'. Imho. Unless I'm overlooking something. I'm not a 190 IQ mathwiz.  )


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## tabzer (Nov 30, 2020)

notimp said:


> Not if they are only playing 'gateway' (exchange/broker). Thats nothing. Thats 'I've made new app, it s so easy to get it now!'.



Which is a %180 from a couple years ago when Jamie Daimon was calling it a scam and said JPMorgan would never deal with Bitcoin.

Sure they would be brokers, but that's also them becoming part of Bitcoin's structure.  The social contracts.  Of course, the only person who can possess a bitcoin is the person that has their own keys protected from prying eyes.



notimp said:


> There are structural limitation for it to be used in everyday transactions. (Would need several 100.000s+ of verified transactions a second. Have 10.000).



Yes, using bitcoin directly to pay for goods is not economic, unless it's big.  For things of that matter, I see no problem with using a banking service that manages that.  Bitcoin is better used when moving large amounts at a time.  Between the social contracts and the actual hard code of bitcoin's protocol, there is unlimited potential with various levels of trust of how bitcoin can be used and relied on.



notimp said:


> There are structural necessities for pump and dump schemes to end.



As it matures it becomes a lot less susceptible to pump and dumps and becomes more of a constant.  The pumps and dumps it faces now is nothing compared when it was jumping between $5 and $250.

You call everyone suckers, but that's also called an economy.  People find value in a currency that separates itself from the value of a fiat--which relies on the integrity of a government and how much they are willing to decrease its vale via inflation with bailouts/grants/and whatever excuse there is to print more money.


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## notimp (Nov 30, 2020)

tabzer said:


> Which is a %180 from a couple years ago when Jamie Daimon was calling it a scam and said JPMorgan would never deal with Bitcoin.
> 
> Sure they would be brokers, but that's also them becoming part of Bitcoin's structure. The social contracts. Of course, the only person who can possess a bitcoin is the person that has their own keys protected from prying eyes.


Yes, as long as more people come in, value increase works. 

As suckers also can be heroes if more suckers come in, dont focus so much on the suckers part.  Many of them probably make more money than I do in a year. To me its just entirely uncertain, where this goes structurally.

As for the 'social proof' part. Facebook is so much better positioned to scale there than 'neckbeard telling you about crypto..' 

But that doesnt matter, if there is some usecase to be found (that isnt 'national' or 'worldwide currency'). Thats legitimate. And where lets say bitcoin, really, really makes sense. (Apart from being a speculation object. But maybe even thats enough. (Its certainly 'better' than owning a derivative of something, not knowing, if people will honor the contract. Until people dont honor bitcoin contracts anymore..  )


tabzer said:


> As it matures it becomes a lot less susceptible to pump and dumps and becomes more of a constant. The pumps and dumps it faces now is nothing compared when it was jumping between $5 and $25.


Question is, at what point does it become interesting for people for other purposes than speculation. And are those purposes likely/logical to be found from todays pov. And would they drive value to 'sustained new heights'.

Just looking at a trend, saying to yourself 'this will continue' - not really knowing why (because reputation, and new PR and, ...), is a little thin.

But then again - still ample opportunity for people to make (and lose) money - until we know.


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## Ryccardo (Nov 30, 2020)

kosterix said:


> You have never heard of 2FA?


No such thing for bitcoin (as opposed to 3rd party wallet services) - find the private key of an address and you can spend it forever


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## tabzer (Nov 30, 2020)

notimp said:


> Yes, as long as more people come in, value increase works.



That's pretty disingenuous.  It very well could be the same people always increasing its value among themselves.  I don't think that element can be removed, only transitioned, which is why it'll always be a portion of my portfolio.  The adoption amplifies the effect by a lot, yes.  But how is fiat very different?  It only takes one bad deal with China for the US dollar to disintegrate with everyone running away from it.  It's good to diversify and hedge your investments, but if you hold only fiat and not bitcoin, I think it is lost potential.  I've been through several bear markets, but my investment strategy is consistent and mostly non-impulsive, so I end up recovering quite well with the market.  It requires a lot of patience.  I wouldn't put all your money into it.  There are uncertainty elements, and the general consensus is that you shouldn't risk what you wouldn't be willing to lose.  Investing always is a form of gambling.



notimp said:


> Facebook is so much better positioned to scale there than 'neckbeard telling you about crypto..'



Using this as an opportunity to pump Libra, a controlled, centralized system and a distribution scheme that puts everyone at a disadvantage from boot?  What they are making is pretty often compared to an antithesis of cryptocurrency.  Among the worst.  There are already other projects and upgrades that have improved scaling by 100x.  They'll be more volatile, but they will also mature if they demonstrate unique use case and benefit cryptocurrencies capacity of liquidity.

Lol with Libra, if facebook decides that you are doing something wrong, they can "delete" your account and take your funds for defying some TOS.

I am not saying that Libra would be a poor investment option.  I'm saying in terms of security, it's an appeal to political authority in the end, with majority of the token already belonging to deep corporate pockets.  They already paid very little, while the consumer pays x100-x1000 for the same token.

--------------------- MERGED ---------------------------



notimp said:


> Question is, at what point does it become interesting for people for other purposes than speculation.



It was always interesting to me.  The pumps and dumps are discouraging, but it's something worth getting desensitized to, imo.  The liberation of being able to hold your own, and to send it anywhere in the world is very nice.  It's a feeling that I cannot describe.  Whether it is worth a lot to others, or a little (I've been on both sides multiple times), it is still mine and at my command in ways nothing else is.



notimp said:


> Just looking at a trend, saying to yourself 'this will continue' - not really knowing why (because reputation, and new PR and, ...), is a little thin.



It will continue as long as the protocol isn't irrecoverably broken.  It may suffer from a huge bear market never to reach current highs again in my lifetime.  But I will still continue my strategy.  I will still continue to appreciate it.  I'm sure I'm not alone.  If I end up being the sole inheritor of bitcoin due to everyone else's depreciation of it, I'd consider myself to be more lucky than unlucky.


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## smf (Nov 30, 2020)

Silent_Gunner said:


> Wait, so cryptocurrency coinage is made by the hardware miners themselves?



It's kinda more complex than that. Bitcoin is just a signed ledger of transactions, every block of transactions is signed by miners and currently you get to keep some bitcoins if you are successful in that.

The signing process is made intentionally harder to keep pace with the number of people mining, essentially the miners generate random numbers and sign the block until the signature has a particular property. In bitcoin you're looking for signatures with a specified number of zeros. The first person to find it gets the reward (or shares it if they are in a pool of miners).

There is an upper limit of 21 million bitcoin (although this is believed to be around 100 years before this will be mined).

When bitcoin started they were essentially free, there are a lot of those early bitcoins sitting in peoples wallets making them (on paper at least) very very rich.

People buying in now are just gambling. If you'd bought in 5 years ago it was just as much of a gamble, but it looks like it would have paid off. Whether a gamble today will do the same, is just guessing.


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## notimp (Nov 30, 2020)

tabzer said:


> Using this as an opportunity to pump Libra, a controlled, centralized system and a distribution scheme that puts everyone at a disadvantage from boot?


I'm not trying to convert you to Libra.  (Me doesnt like the facebook.  ) I'm trying to say - that you have no 'unique selling proposition' and the first mover advantage, can easily be circumvented by regulation, or someone like facebook simply scaling faster in marketing.

Here is how I think of it (for whatever reason).

Where is the compound growth. So where is the steady, but lasting growth opportunity.

'Speculating' makes sense, if you want to 'hit it big' (high risk, high reward), if you already have 'I'm ok with this' money, and want to grow even bigger (lets say bigger than the 'opportunity cap' of bitcoin), you look for compound interest.

(Business opportunities, growing year over year (the things millennials arent allowed to have anymore, because climate change..  ).)

And all I see is pump and dump exchangerate spikes (which have decreased in frequency), but no sustained growth. Growth as far as I can tell is based on marketing opportunity. At which point you ask 'is this the right thing for the job?' at which point you end up at 'what job?'. And thats not good..


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## tabzer (Nov 30, 2020)

I agree with you on all of those points except this:



notimp said:


> And all I see is pump and dump exchangerate spikes (which have decreased in frequency), but no sustained growth. Growth as far as I can tell is based on marketing opportunity. At which point you asl 'is this the right thing for the job?' at which point you end up at 'what job?'. And thats not good..



Sustained growth is a point of view.  If you bought at $3,000, saw the spike to $20,000, and then it dropped back down to $4,000 and bounced around between $9,000 and $15,000... you are still looking at a sustained growth of a minimal of $1,000 from your buy in.  It depends on your frame of reference.  If you bought ONLY at $20,000 a year ago, you are still sitting at a loss.  But if you kept a consistent investment strategy, all those times you bought at $11,000 and $7,000 would be paying off.  Bitcoin seems to have a pattern of gigantic spikes when it hits a a new benchmark on social/political standings.  It gets to crazy highs, and suffers major downfalls, but the overall mean seems to be a somewhat parabolic increase.

The job of bitcoin is to be a censorship-resistant form of transferring and storing value.  Volatile, and an experiment, but it is a project that I'm glad to be apart of.  Libra will never replace this property of Bitcoin, so I see them co-existing.  Bitcoin, being first, and the example, is the litmus test of cryptocurrency at large.  The proof it is trying to approach is "can this be secure forever", and there will be no conclusion in terms of forever.  The secondary option is, "at what point will it fail?".  It's a gambler's epitome.


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## notimp (Nov 30, 2020)

tabzer said:


> The job of bitcoin is to be a censorship-resistant form of transferring and storing value.


Thats very limited use. At around 1mio USD investment, banks are giving you the same services when it comes to transactions ("hide it from the gov" - except if the FBI is showing up at your door, because they tracked swift - roughly).

If facebook is taking the 'volatile exchange rate market' (currently its unsure, because they play ball with local central banks and seem to bind themselves to individual currencies)), which is people wanting to convert money to USD fast, because their own currency devalues quite rapidly - taking into account the exchangerate costs -- whats left as a market seems 'hard to grow'.

But then, lower opportunity costs 'because you can do it in your paypal account' might provoke a usage pattern, that scales unforseeably well and... One can dream.. 

Last time I checked, every one was still hyped for no reason on writing papers on the prevention of international crypto based tax fraud, which has me immediately thinking "on how big of a market". None of the bigger players needs it.

My internal reference model for bitcoin is Western Union x2 - maybe.  Without having ever looked at the numbers (amount of cash that is currently syphoned out of China f.e.) too closely.


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## tabzer (Nov 30, 2020)

Banks aren't censorship resistant, and their use is stapled to whatever currency that you are using; which is likely to be inflationary.  Bitcoin is like non-inflationary asset you can "store under the mattress" that you can transfer far away on a whim.  The service has no downtime and aren't prone to audits or legal hang-ups, for any reason.  The only reason a transaction would hang is because the blocks are full and the fee that you offered wasn't competitive enough to push it to the front of the queue--an aspect that is constantly being addressed and worked on.  I don't see banks going away because of bitcoin, but to say that banks offer the same thing as bitcoin is negligent. 

Again, with the Western Union prospect, you are still dealing with the same aspects I mentioned above.  I'm not trying to argue that Bitcoin is needed by bigger players.  I'm suggesting that it has its own unique appeal that is liberating to the individual and gives a sense of self-authority.  I personally prefer it to gold for a variety of reasons if you are interested.  It is something the smaller players will chase, and the bigger players will eventually be compelled to follow-as we are seeing at its current phase of adoption.


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## notimp (Nov 30, 2020)

tabzer said:


> Banks aren't censorship resistant, and their use is stapled to whatever currency that you are using; which is likely to be inflationary. Bitcoin is like non-inflationary asset you can "store under the mattress" that you can transfer far away on a whim.


Yet noone seems to be using bitcoin as value storage, compared to the interest thats in it for value transfer, and speculation.

The truth is, if states clamp down on some of the bigger BC exchanges and start to seize assets, BC is sol. Have a value storage, thats not easily transformable into anything else, and its value tanks.

With gold, you have state held deposits. With banks you have them integrated highly into your commercial economies.

With BC, if it becomes too big, you block the IP address ranges of the 5 most active exchanges, as a bigger country - people will try to get their money out so quickly.... 

BC certainly is an interesting experiment. And in many senses, more than that by now, but does it have the capacity to grow into anything bigger, that still has structural importance is a harder question to answer.

Facebook almost messed this up royaly the first time around. They: "Yeah, we will be the worlds reserve currency, starting in february." "US Fed: "How about not". 

Also at 1 mio+ investment volume at a bigger bank, you pay them to diversify.  They handle the risk, not you.  (Until you get bigger than HSBC f.e...  )

Scarface was "pretty spot on" in that regard (watch it again  ) you bring money, they dont ask questions, they take on 'diversification risk'. If feds (or internationally FBI) shows up, you lost.  (They pay fine, and continue.)


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## tabzer (Nov 30, 2020)

notimp said:


> Yet noone seems to be using bitcoin as value storage, compared to the interest thats in it for value transfer, and speculation.



Can you elaborate on what you mean?  Many people try to buy low sell high, if that's what you mean, but a long position has less risk.



notimp said:


> The truth is, if states clamp down on some of the bigger BC exchanges and start to seize assets, BC is sol. Have a value storage, thats not easily transformable into anything else, and its value tanks.



Define easy.  After Venezuala was in ruins, and its currency worthless, people started picking up bitcoin and other crypto to fill that void.  Granted, it's terrible to have a worse case scenario to force a people to adopt a new form of stability.  But you can barter crypto for goods an services without an exchange.  It is like its own internet of money.



notimp said:


> With BC, if it becomes too big, you block the IP address ranges of the 5 most active exchanges, as a bigger country - people will try to get their money out so quickly....



Yes, there is bottlenecking with both exchanges and the network itself when there are large swings in the landscape.  Ignoring them helps me retain my position, and it always seems to come back stronger.  The idea is that you should not let your speculation on price govern what the token means to you.  Otherwise it's superficial and you will lose your position.



notimp said:


> BC certainly is an interesting experiment. And in many senses, more than that by now, but does it have the capacity to grow into anything bigger, that still has structural importance is a harder question to answer.



By itself, it will be slow to change its own protocol because of the nature in its decentralization.  As unappealing it is in this respect, it is just as much, if not more appealing, in the sense that it is reliably what it is.  It's stable.  Everything from 2nd layer approaches to the point of social contracts are establishing themselves around it.  An example is the lightning network, which is like a node system that allows independent nodes to handle multiple inputs/outputs, then submit a settlement as a single transaction whenever it deems fit.  That is a bridge that can reach into so many social contracts, with varying degrees of trust and redundancy.  For example, if Paypal wanted people to manage their own wallets, they can be a node for all the transactions between them for a year, only to submit one request to the blockchain as a single settlement.  The amount of overhead/fees that are reduced in this prospect is really f*king amazing.



notimp said:


> Facebook almost messed this up royaly the first time around. They: "Yeah, we will be the worlds reserve currency, starting in february." "US Fed: "How about not".



Because it is centralized, and they are trying to own the cryptocurrency they are advertising.  It makes it a security.   Bitcoin has no president.  Just "influencers" which can't seem to do a whole lot ever since the protocol was established.  Either 51% of the network agrees on the change, or it isn't happening.  Facebook can change the TOS and take your Libracoin from under your pillow.



notimp said:


> Also at 1 mio+ investment volume at a bigger bank, you pay them to diversify.  They handle the risk, not you.  (Until you get bigger than HSBC f.e...  )



I believe you alluded, before, that the bigger the risk, the bigger the potential payout.  It is true that many people don't want to be so directly in control of their money where they take on the risk of impulse and bad investments.  There are varying degrees of approaches that can mitigate the risk, as well as the potential reward.  To each their own.




notimp said:


> Scarface was "pretty spot on" in that regard (watch it again  ) you bring money, they dont ask questions, they take on 'diversification risk'. If feds (or internationally FBI) shows up, you lost.  (They pay fine, and continue.)



As many shows/movies I have on my backlog, that's always one I could always make time for.


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## notimp (Nov 30, 2020)

tabzer said:


> Can you elaborate on what you mean? Many people try to buy low sell high, if that's what you mean, but a long position has less risk.


Market cap. 200 billion is not that much. If you talk about value storage.
https://www.statista.com/statistics/377382/bitcoin-market-capitalization/
Gold is at 9 trillion. 

And nobody is into gold these days..  With 'value store' you are not talking 'half of one countries yearly budget" - you are talking 200 years of a countries yearly budget sums. 

US likes bitcoin, if it brings value into the country. But no one (other than the people doing the pump and dump, and managing small investor collectives) quite stays in there. For what? To 'almost reach the values you reached last year'? You buy low, you sell high, in the time in between you are market making.

Getting brokers like paypal in, means - that it becomes more socially accepted. For big investments, thats more or less 'added security' (consumer facing its more PR), as in people are starting to talk to people, networks are created, and so on. No one wants to shut something down as long as it works (as in brings in private investment money from China f.e.).

But thats not so much because of a 'resilience' in BC over state regulation. I think thats mostly a story.


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## tabzer (Nov 30, 2020)

BC's resilience and neutrality earned the current state regulation, imo.  You aren't completely wrong about what you said.  Bitcoin is still smaller than gold, but you are more likely to get fake gold than you are to get a fake bitcoin--assuming you were equally educated in both.




notimp said:


> US likes bitcoin, if it brings value into the country. But no one (other than the people doing the pump and dump, and managing small investor collectives) quite stays in there. For what? To 'almost reach the values you reached last year'? You buy low, you sell high, in the time in between you are market making.



They keep revisiting and more so when the see that the trend doesn't dissipate.  If you want to disparage bitcoin because it is finally reaching last year's high, it means you do not think it can break out again.  I think it can, and it will be sooner or later.  You are arguing for a short position.  I don't relate to that.

I think if Biden assumes office, we will see a burst.  If we see Harris assume office, we will see a small burst and settle higher than ATH, but not as much.  If we see Trump again, we will face more resistance but eventually it'll break the ATH and carry on slowly after that.


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## ClancyDaEnlightened (Nov 30, 2020)

Bladexdsl said:


> your a fool if you do and your encouraging assholes miners PLUS jacking up video card prices



buy a good card, use it to mine when not doing anything else otherwise, i consider it an "unlimited rebate", that decreases with time and age of hardware (miner/difficulty), 

if you're like me, you'd get an ups connected to a solar panel = free money


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## notimp (Dec 1, 2020)

aadz93 said:


> buy a good card, use it to mine when not doing anything else otherwise, i consider it an "unlimited rebate", that decreases with time and age of hardware (miner/difficulty),


Yeah, dont forget to calculate in electricity cost. Which made mining on consumer hardware entirely useless, in most western countries - for _any_ of the established currencies. (?)

*The moment you realize that even your drop dead crazy "value hardware" video blogger, that posts videos from thrift stores in Australia tells you that he uses custom mining hardware (silicon), when mining his digital currency, you've never even heard of.* Which he then only sells, when the exchangerates are good.
#techyescity #loveitunironically

There is a difference between doing something entirely mad, and believing it will work, because it actually has an interesting and novel aspect to it.

And -

doing the same thing for the 200th time on the next altcoin coming along, pegged to bitcoin in value - believing, that lightning will strike twice.


edit: Profitibility analysis:

at 4:20 in.

Also that guy - is selling you bullsh*t for most of the video. Just as a reminder, that youtubers - in general - make money from people buying into commercial ecosystems.


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## ClancyDaEnlightened (Dec 1, 2020)

notimp said:


> Yeah, dont forget to calculate in electricity cost. Which made mining on consumer hardware entirely useless, in most western countries - for _any_ of the established currencies. (?)
> 
> *The moment you realize that even your drop dead crazy *value hardware* video blogger, that posts videos from thrift stores in Australia tells you that he uses custom mining hardware (silicon), when mining his digital currency, you've never even heard of.* Which he then only sells, when the exchangerates are good.
> #techyescity #loveitunironically
> ...




what electricity costs? where i live solar power is feasible pretty much all year....,  using an ups + solar panels,  i can also go futher and replace the psu and use pico atx psu's and run straight from the 12v without needing any inverter: https://ebay.to/2HVfRjv


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## Jayro (Dec 1, 2020)

Their prices keep skyrocketing, so why not?


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## notimp (Dec 1, 2020)

aadz93 said:


> what electricity costs? where i live solar power is feasible pretty much all year....,  using an ups + solar panels,  i can also go futher and replace the psu and use pico atx psu's and run straight from the 12v without needing any inverter: https://ebay.to/2HVfRjv


Just looked up profitibility charts for coins you never heard of, because you sold people on an idea ("just do it!"), and never bothered to. edited it into the previous posting.


Jayro said:


> Their prices keep skyrocketing, so why not?


Their prices also keep pludering down, and then never reaching inital highs for another three years. Idiot. I hate it, when hypers try to spend other peoples money.
-----

So now you get people to buy solar panels, living in NY city, generating 300W? Buying them for 500USD a pop. Together with a picopsu (specialized hardware). To "mine". Which will net them 3 USD per day. On a 3080. Power costs (or solar panel acquisition costs) not included.

With the promise, that if they rope in more unknowing morons, maybe the value of the currency they are currently mining, might spike. Because of NO STRUCTURAL REASON WHATSOEVER.

I remind you, that the best reason we could come up with in this three pages, for why bitcoin value should rise further was 'commercial networks and the PR value they provide'.

Also please show me your solar panel rig, that produces 300W.


----------



## ClancyDaEnlightened (Dec 1, 2020)

notimp said:


> Just looked up profitibility charts for coins you never heard of, because you sold people on an idea ("just do it!"), and never bothered to.
> 
> Their prices also keep pludering down, and then never reaching inital highs for another three years. Idiot. I hate it, when hypers try to spend other peoples money.





all i care about is btc and xmr......


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## notimp (Dec 1, 2020)

aadz93 said:


> all i care about is btc and xmr......


So what you are saying is, that on a 3080 you are gaining value of 1 USD a day?

Now thats something, other people should choose as their hobby.

Upfront costs:
- 3080 (partly subsidized by also playing on it, and resell value)
- PicoPSU (with a 3080?)
- Solar Panels (for about 300W sustained)


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## ClancyDaEnlightened (Dec 1, 2020)

the pc in my sig generates about $3 a day using both cpu and gpu to mine,  use the solar panels to charge some spare deep cycle marine batteries i had,  currently it runs through a 120v inverter, though using pico psu should be possible if really want to be efficient , IF they actually can handle 400W


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## notimp (Dec 1, 2020)

If you'd actually wanted to be efficient?

So you bought so many solar panels, that you didnt even need the pico PSU, which you then didnt use, but mentioned?

Also I dont see a PC in your signature.

And what are you smoking?






src: https://jblevins.org/btcmpc/

I changed hashrate to 0.086 Gh/s (== 3080 performance, see: https://whattomine.com/gpus ) cost to 700 (price of a 3080 if in stock), and power usage to 300w. Profit over a year came out to -1,094.20 USD

At 0.0 USD cost per kWh (USD), profit over a year came out to -700 USD, btw.


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## tabzer (Dec 1, 2020)

Staking is a better alternative to mining, PoS (Proof of Stake), imo.  Tezos, which is something I have staked is returning about 6-7% apr (in terms of the token).  Like all crypto, the fiat price point is unreliable.  At least you don't have to have hardware running to do it.    There is usually a grace period before it kicks in, but it compounds itself which is interesting.  The use case of it is even more scrutinized than bitcoin, but cryptos these days are getting easier to swap via centralized and decentralized exchanges.  I don't know if Tezos is likely to increase in price like BTC is, since it's an altcoin.  Holding BTC seems like the least risky option.  Still not without risk.  It is gambling.  The higher the risk the greater the potential reward or loss.


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## notimp (Dec 1, 2020)

tabzer said:


> Staking is a better alternative to mining, PoS (Proof of Stake), imo.  Tezos, which is something I have staked is returning about 6-7% apr (in terms of the token).  Like all crypto, the fiat price point is unreliable.  At least you don't have to have hardware running to do it.    There is usually a grace period before it kicks in, but it compounds itself which is interesting.  The use case of it is even more scrutinized than bitcoin, but cryptos these days are getting easier to swap via centralized and decentralized exchanges.  I don't know if Tezos is likely to increase in price like BTC is, since it's an altcoin.  Holding BTC seems like the least risky option.  Still not without risk.  It is gambling.  The higher the risk the greater the potential reward or loss.


Ah tabzer is now moving people into the gigworking space (all you are worth is what the network tells you, based on your assessed means), now thats the spirit.. 
https://www.investopedia.com/terms/p/proof-stake-pos.asp

Well - at least for the time they are setting up their cards to 'work' for them. 

Imagine you are mining for gold. But the chance of finding it is not '(weighted) random', but determined by how much money you invested in equipment. Pretty much exclusively.  That said, chance of mining 'gold' in the proof of work model now is exclusively determined by  how cheaply you can pool people with equipment in ressource pools, whilst having them pay for the privilege.


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## ClancyDaEnlightened (Dec 1, 2020)

notimp said:


> If you'd actually wanted to be efficient?
> 
> So you bought so many solar panels, that you didnt even need the pico PSU, which you then didnt use, but mentioned?
> 
> ...







two solar panels @24v, which is down-regulated to 12DC, this charges the batteries, 4 deep cycle marine batteries, then this is converted to 120v via an inverter, i can remove the inverter and use multiple pico atx in parallel, reduces losses from the inverter

i can run two desktops and easily get $5-10 a day ( two gpu's, per desktop, and mining xmr on the cpu, which i would move to amd)

even then where i live electricity is cheap, way less than 15 cents a kilowatt

using solar i don't even pay that, all i pay is the cost of the hardware itself, and internet, let it mine long enough, that cost will be refunded


and i use my gpu to mine kawpow, which is then converted to btc, i make about a 1.25 a day  or so just by the gpu alone, the cpu makes about 50-80 cents a day, but its old anyway

its just experiment in the end, in the end ain't gonna change my mind, 

once i'm done, have a bunch of gaming desktops i can sell aswell.....


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## tabzer (Dec 1, 2020)

notimp said:


> Ah tabzer is now moving people into the gigworking space (all you are worth is what the network tells you, based on your assessed means), now thats the spirit..
> https://www.investopedia.com/terms/p/proof-stake-pos.asp



Can you reword that in a way that I can understand what you are saying?  PoS is an alternative to PoW which doesn't require the bulk of the hardware and electricity to sustain it.  With all currencies, the more you have, the more you are worth.  That is the concept of "wealth".


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## notimp (Dec 1, 2020)

tabzer said:


> Can you reword that in a way that I can understand what you are saying?  PoS is an alternative to PoW which doesn't require the bulk of the hardware and electricity to sustain it.  With all currencies, the more you have, the more you are worth.  That is the concept of "wealth".


No, the more you have the more you are likely to gain in the future. But without any element of chance, or 'circumstantial chance', or structural risk possible.

As in ever possible. From the first minute on the system is crafted.

Its as if someone looked at BTC and said, we dont like the romanticism, of someone finding 'gold' by chance, we think mining should be owned by the early big investors from here to eternity. The more you have, the more you gain. And this should prevent you from going against the system at 51% ownership of miners. We give you the full path to monopoly - from the first second on - without any of the romanticism, of also having chance in there.

We dont detest 51% ownership of verification, we long for it happening.

When starting such a currency you are basically drawing in the big players (in the field) at the start, and then fucking over all newcomers for eternity.

This has nothing to do with the 'decentralized' 'we reward neckbeards' model.

But then arguably no crypto currency after BTC (that will ever be of any importance) does. Which might be another unique selling point for BTC. It was the max divested one in the beginning. It became centralized, when professionals took over.

With Proof of stake, its licking the big players balls from the beginning. (How fast is the development rate on custom silicon?)

If thats the case (and everyone is trying to pull the big players in in the beginning, and then giving them advantage for life) - Cryptocurrency that doesnt lend itself well for custom silicon mining, would play a more and more diminishing role compared to all others. Do you know - is that the case?

For the single miner - this essentially means he opens up app. He gets their rate. He mines. He never gets a leg up. He never gets a raise. He never gets to compete. Distribution of 'stake' is decided in the beginning - especially with 'luring big players in' in mind. You give them a guarantee, that the only thing that matters is - what they have put in, and that they stay loyal.

But again, I dont think, that this is so much different with PoW (as it looks currently) either.

So lets see Cryptocoins as a scheme to draw in big investment in the beginning, and then perpetually draw in more and more suckers. Tell them what they are creating is the new gold - because its good for not much else. Endgame pump and dump.

And shed all the illusions of even roughly 'equal chance' in the beginning, just for a mere promise, that verification scales better in the end, and you are the currency that can become a widespread payment solution.

You know - facebook has it right.

Just sidestep that. Just say in the beginning, these are the 25 companies that will matter. Peg it to USD, so you solve the hyper inflation (and the price stability) issue. (But to allow to modify 'what it is' - in circulation.) Then do what you want, and be more competitive on every front.


edit: Basically this: https://old.reddit.com/r/ethereum/comments/6d1mca/proof_of_stake_leads_to_centralization_with_worse/


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## tabzer (Dec 2, 2020)

@notimp 

The problem with your analysis on PoW vs PoS regarding dominance of the network overlooks a key component.  The perceived decentralization of a network is considered a strength.  People get wary and confidence is lost when any actor or pool approaches %51.  This applies for any cryptocurrency, but PoS is definitely harder to verify.  %51 is not a goal for anybody, other than those who want to push an upgrade/change into the system.  Changes perceived as nefarious will cause the crypto to drop in value.  You are using very old sources that still bear relevence, yet are not up to date.

Also, with PoS, there is no hardware or electricity investment to consider.  You can stake a token and not look at it ever again.  




notimp said:


> When starting such a currency you are basically drawing in the big players (in the field) at the start, and then fucking over all newcomers for eternity.



This is false.  Big players draw in huge waves of instability.  Even so, they still want to make a profit.  It's is not an interest to to make that a negative value.  What you are describing as "fucking over all newcomers" isn't a true assessment.



notimp said:


> So lets see Cryptocoins as a scheme to draw in big investment in the beginning, and then perpetually draw in more and more suckers. Tell them what they are creating is the new gold - because its good for not much else. Endgame pump and dump.



End game: pump and dump, and pump and dump eternally, to the point that the ability to do so just diminishes into stability.

I get that you are trying to paint this as a pyramid scheme.  But a big player's exit is an opportunity for the rest of the network.  It's continuously recycled.

As for Libra?  I don't really see what it offers for people in the way you are pitching it.  How is it so different from rewards programs, and mileage programs, other than just connecting different companies on the same program?


----------



## wonkeytonk (Dec 2, 2020)

I think the future is headed towards DeFi currencies; namely Chainlink.
I don't trust Bitcoin and other centralized currencies; there are also some allegations claiming that BTC is owned by China and that people are trying to hide that fact. So I think Bitcoin might be designed to fall at times when the media convinces everyone to buy it.
DeFi altcoins are better.

Real estate is definitely not as good to trade with because of all the people this year who couldn't pay rent.


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## tabzer (Dec 2, 2020)

wonkeytonk said:


> I think the future is headed towards DeFi currencies; namely Chainlink.
> I don't trust Bitcoin and other centralized currencies; there are also some allegations claiming that BTC is owned by China and that people are trying to hide that fact. So I think Bitcoin might be designed to fall at times when the media convinces everyone to buy it.
> DeFi altcoins are better.
> 
> Real estate is definitely not as good to trade with because of all the people this year who couldn't pay rent.


If that's the case, it seems like you can buy it when the media talks bad about it, and then sell when they talk good about it.  While it's true that China is the place where the majority of mining occurs, I don't think it is in their interest to turn it into a net negative or to make BTC's protocol to look compromising.  See my previous response to notimp.

DeFi is another high risk/high reward situation.  It's blown up sooo much recently,  I personally think there's going to be some down tim, reconsilidation.  Bitcoin, altcoins and Defi will probably alternate bear/bull markets, and with gaps of "nothing great" in between.  My hunch is that Bitcoin and altcoins will trade trends before Defi enters the picture again.  Defi is just another PoS situation.


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## notimp (Dec 2, 2020)

tabzer said:


> The problem with your analysis on PoW vs PoS regarding dominance of the network overlooks a key component. The perceived decentralization of a network is considered a strength. People get wary and confidence is lost when any actor or pool approaches %51. This applies for any cryptocurrency, but PoS is definitely harder to verify. %51 is not a goal for anybody, other than those who want to push an upgrade/change into the system.


That crossed my mind as a positive for PoW, compared to PoS. Then came the realization, that with GPU mining not being viable anymore, comes the centralization anyhow. (Respectively, it came with BTC, at least 'regionally'.)

But then centralization (lets say 10 major stakeholders) would not lead to the 51% attack (colluding), with 'raising perceived worth' in mind. At least for a while. (Depends if the end goal is currency, or value storage. If it is value storage... Probably depends on investment size (how easy is it to get 51% to collude for 'potentially only one hit' (risk of being found out)).

Lets say issue with PoW is low transactions per second - and we accept that PoS is a solution. With PoS race to 'max pool size' is on from the first second, after that you generate more pools. I dont know how max pool size prevents cannibalization of small players - if at all (many pools with growth cap also should have a cumulative effect (?)), but if thats your layout - just skip the step and announce 'your 25 biggest players' on day one. Honestly.

I dont buy into 'but if the risk of loss of trust is too high' pools will have to split, because thats just a perception play. So use strawmen and continue. Outcome is the same. edit: You might have to link them in 'public interest networks' or something after that to get the size based effects again. But since you can change protocol, you'll find a way to pressure out smaller stakeholders over time. Probably.


edit:

Hmm... interesting:


> Our results based on simulated paths of the dynamics of nodes' coins at stake suggest that decentralization of PoS blockchains can be largely maintained with moderate constant or dynamically adjusted coin inflation while decreasing inflation yields a large loss in active staking nodes over time when coin prices are static.


src; https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3293694

Oh - how good that the Facebook Coin is a stablecoin, then..


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## tabzer (Dec 3, 2020)

notimp said:


> Oh - how good that the Facebook Coin is a stablecoin, then..



Why do we need more stablecoins?



notimp said:


> Lets say issue with PoW is low transactions per second - and we accept that PoS is a solution. With PoS race to 'max pool size' is on from the first second, after that you generate more pools. I dont know how max pool size prevents cannibalization of small players - if at all (many pools with growth cap also should have a cumulative effect (?)), but if thats your layout - just skip the step and announce 'your 25 biggest players' on day one. Honestly.



That's a lot of conjecture showing you haven't even given it serious consideration.  You frame it as a competition.  Why?  Cannibalism?  Can you give one situation where cannibalism occurs in Tezos?  

As I stated before:

As for Libra? I don't really see what it offers for people in the way you are pitching it. How is it so different from rewards programs, and mileage programs, other than just connecting different companies on the same program?

Please answer.


----------



## notimp (Dec 3, 2020)

tabzer said:


> Why do we need more stablecoins?


Stablecoins are what you'd 'need' to conquer the international money transfer space and optimally profit. (You try to make people forget, that they are holding deposits in funny money, which gives you more time to speculate with their assets). But the comment was ironic - since facebook coin is not PoS based (in the traditional sense - they dont create currency through mining).

Why would people cannibalize each other? Because with PoS the more you invest the higher your gains. (The game is to grow fast, earlier, than others.) They do it as rational actors. If you cap them to a max pool size and stop the size effects (?) investment already taken helps you in creating additional pools. If size effects ('the richer you are the more likely you are to make money') are somehow disabled by pool size caps, you do it for power. (The higher percentage of verifications you get - the more important your voice becomes on 'protocol changes').

Normal miners dont 'scale' as well (as people investing big early), you are telling big players 'keep at it' you can become 'number one' even past 51%,  - in theory, to prevent them from mounting attacks against the integrity of the network (because they can still grow). So they are still 'motivated and enthused' to get bigger.

At the same time lets say at some point demand for validation for transactions per second stabilizes. Small miners get less and less returns (as the bigger invested guys have been growing faster), turn their machines off - and the 'active network of validations becomes smaller'. This then is 'cannibalization'.



tabzer said:


> Can you give one situation where cannibalism occurs in Tezos?


I can't. I dont look at specific coin models/setups, because If I'd do, I'd go crazy.  You would need the 'best protocol' coming out 'first' because of market competition. Currently you still see bitcoin dominating the market (value and transaction wise). Which means the entire 'market' for cryptocurrencies is more or less still an incubator - where the best idea certainly doesnt win. But the right angel investor can bet on a certain currency, to raise its perceived importance, and thereby value.

And everybody tries to get the highest investment into their currency, to grow (perception wise), to also grow in worth. You can have the best idea, and nobody noticing or backing.

Thats why I asked if PoS was mainly a play to attract big investors early, which would make sense in such an environment.

I cant get into 'but with Tezos, that doesnt occur', because I'm not that interested overall. I dont try to design my life around knowing 'which is the most promising solution' at any point, from multiple stakeholders perspectives.


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## tabzer (Dec 3, 2020)

notimp said:


> Stablecoins are what you'd 'need' to conquer the international money transfer space and optimally profit. (You try to make people forget, that they are holding deposits in funny money, which gives you more time to speculate with their assets). But the comment was ironic - since facebook coin is not PoS based (in the traditional sense - they dont create currency through mining).



The comment is not ironic.  The comment appreciates that there are already stablecoins, and does not recognize the appeal for a new one.



notimp said:


> Why would people cannibalize each other? Because with PoS the more you invest the higher your gains. (The game is to grow fast, earlier, than others.) They do it as rational actors. If you cap them to a max pool size and stop the size effects (?) investment already taken helps you in creating additional pools. If size effects ('the richer you are the more likely you are to make money') are somehow disabled by pool size caps, you do it for power. (The higher percentage of verifications you get - the more important your voice becomes on 'protocol changes').



You have not given an explanation of how cannibalism occurs with PoS.



notimp said:


> Normal miners dont 'scale' as well (as people investing big early), you are telling big players 'keep at it' you can become 'number one' even past 51%, - in theory, to prevent them from mounting attacks against the integrity of the network (because they can still grow). So they are still 'motivated and enthused' to get bigger.



There is no incentive to become "Number 1."  If maximum wealth is the objective, then the incentive is to get as much as you can without hitting the radar.



notimp said:


> At the same time lets say at some point demand for validation for transactions per second stabilizes. Small miners get less and less returns (as the bigger invested guys have been growing faster), turn their machines off - and the 'active network of validations becomes smaller'. This then is 'cannibalization'.



Small miners in a PoW setup get less of the wealth for two reasons.  First, there are more being added to the network.  Second, hardware is going through upgrades in efficiency.  So miners have to upgrade to stay competitive.  In PoS, these issues are non-existent.

As for Libra? I don't really see what it offers for people in the way you are pitching it. How is it so different from rewards programs, and mileage programs, other than just connecting different companies on the same program?



notimp said:


> I dont try to design my life around knowing 'which is the most promising solution' at any point, from multiple stakeholders perspectives.



But you will present yourself as appearing to have thoroughly thought-out on Bitcoin and Libra.

You should research tether.  (Stable-coin).  Supposedly it is "backed by the US dollar", but who knows because there is never a real audit.

Libra will be worse than that.  They don't back it up with anything (just clout?).  So far, there is not a demonstrated incentive to use it.  Maybe what, save %10 on Macy's hair conditioner when purchasing with Libra?  Everybody loses.

Let's say I really want the hair conditioner.  Buy just enough libra, purchase hair conditioner, then I'm out.  Unless they are guaranteeing stable interest rates that are are higher than what banks offer, and stapled to the USD, then sure.  There's potential there.  But FB as a bank, that can censor how you use your money?  I'm sure that will become an issue very quickly, drawing even more appeal to BTC.


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## notimp (Dec 3, 2020)

tabzer said:


> The comment is not ironic. The comment appreciates that there are already stablecoins, and does not recognize the appeal for a new one.


Appeal for a new stablecoin under PoS is everyone wants to have their own transaction network.  (Everyone wants to have that 'power' (as in every country wants their own currency).) If thats not acknowledging appeal... 

Apart from that - the model (PoS) doesnt tell you about general appeal (market conditions, supply and demand, ...)

They are not connected. So when I'm saying "why dont you do it like Facebooks coin" I'm not doing it to promote Facebook, or confront you with feelings that 'there only can be one' - I'm trying to challenge assumptions, for why a certain model is better than another.

If people like two models - then two can exist.

I've already said, that I dont believe that in the cryptocurrency world, the 'best' model wins. With PoS, the model that can draw in the biggest amount of angel investment early - becomes more important.


tabzer said:


> There is no incentive to become "Number 1." If maximum wealth is the objective, then the incentive is to get as much as you can without hitting the radar.


And by what information would the rational actor decide that? 'How people are 'feeling' about the currency?'.

Oh - people are not feeling good about USD right now, I better not print it anymore?

The inefficiencies in that 'communication system' are enough to destroy the currency, gradually - or before anyone notices. I talk about this as 'only a perception issue'. Meaning, any significant action that impacts it - is probably marketing related. Therefore most of the actions you are getting are marketing. Even if the 'regulating instance' would tell me 'split up - stop acquiring wealth' my first idea of adhering to that would be to fake it out ('here' I've given it to five of my relatives - perception problem solved? (might not tell, that I've given it to five relatives == reduce transparency)).

Also - the question - seriously - is, if you even care about peoples perception on decentralization. Because if everything else 'works' and value rises (f.e. because more people use it for value transfer, or as value storage), who the f*ck cares about the neckbeards droping out vs. the big players.

All you are showing is, that you are stuck to a myth - where that would seem like a big problem - when in reality, everyone with PoS is trying to prove that it is not. 

I tend to see 'small miners' as PR victims. So just something you can put on your spec sheets to tell people how decentralized you are - when in reality (on verifications) - you are not.

This also is the game on paying people above market value exchange rates to bitcoin (vs dollar value). You subsidize the stupid, so you can say you are big and diversified. This isnt sustainable. But who cares, as long as your currency gets a big break at some point.

All you need is stupid people you feed with explanations like


> Tezos is a decentralized, open-source blockchain network that can execute peer-to-peer transactions and serve as a platform for deploying smart contracts. The native cryptocurrency for the Tezos blockchain is the tez or tezzie, which has the symbol XTZ.


.
They bring you engagement. They become your evangelists. All the wile they are working for rates that you fixed (you are paying them, you are spending money) to get your currency model to grow.


----------



## tabzer (Dec 3, 2020)

notimp said:


> Appeal for a new stablecoin under PoS



Stablecoins are not PoS.  I neve suggested that there was an appeal for one.  Is that what you are suggesting?



notimp said:


> I tend to see 'small miners' as PR victims. So just something you can put on your spec sheets to tell people how decentralized you are - when in reality (on verifications) - you are not.
> 
> This also is the game on paying people above market value exchange rates to bitcoin (vs dollar value). You subsidize the stupid, so you can say you are big and diversified. This isnt sustainable. But who cares, as long as your currency gets a big break at some point.



You are conflating PoS issues with PoW issues.  PoS doesn't suffer cannibalization.  PoW is pretty clearly a hardware optimization game.  Mining pools (PoW) have historically had issue with approaching a %51 situation, where confidence was falling as was the value.  The remedy was to draw attention to the fact, and the miners reorganized.  Sure, 3-4 major pools could still sabotage the protocol if they acted in concert.  But why?


----------



## Goku1992A (Dec 3, 2020)

It's kinda too late to invest now. The best time was to invest years ago. Better invest in stock


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## notimp (Dec 3, 2020)

tabzer said:


> Stablecoins are not PoS. I neve suggested that there was an appeal for one. Is that what you are suggesting?


I've merely made a joke about Facebooks 'stablecoin' model lending it self to centralization of 'transaction signing and protocol writing power'. which is a tautology. Because facebooks model is centralized to begin with. But the centralizing aspect - imho - _is_ 'the new cool'. (With a little PR that you also have some gigworkers pressing on virtual buttons, not knowing what they are doing, but that they are earning below minimum wage for it - and going out - convincing others, that this snowball model is the next big thing, to inncrase overall currency value..)

PoS is leading to centralization of those factors. This is independent of what facebook coin is or does.



tabzer said:


> You are conflating PoS issues with PoW issues. PoS doesn't suffer cannibalization. PoW is pretty clearly a hardware optimization game. Mining pools (PoW) have historically had issue with approaching a %51 situation, where confidence was falling as was the value. The remedy was to draw attention to the fact, and the miners reorganized. Sure, 3-4 major pools could still sabotage the protocol if they acted in concert. But why?


PoS is leaving all doors open to cannibalization. The issue identified was not that 'one actor could reach 51%' signing capability, but that - at that point it would be identified more beneficial for them to 'sign and authorize fake transactions, to cash in the fees (while also generating more currency, but that is less important at that stage (algorihm is deflationary - less currency mining based gains)) - at the very moment, they identify the currency as 'not growing (enough) anymore'. (Better to game the system, than to adhere to its rules).


PoS simply sidestepped that by saying you have full competitiveness past 51% (theoretically, dont know if the currencies decided on that in practice), just keep in the competitive model - believing in you gaining more market share over time. To ensure that, we ensure 'big number advantage' (who owns more - gains more).

"And then miners decided to rearrange pools, to "fix" the decision power issue, to ensure everyone, that no one would be at risk of betting against the currency (signing fake transactions)." imho is a story.
It might have been what happened once - but it only happens if people still believe in a growing market (gaining more money by staying in the game, rather than betting against it). And the 'proof' that that happend isnt 'bitcoin'.

Its a marketing agency convincing most of the players or future customers (/investors), that growth is still possible.


----------



## notimp (Dec 6, 2020)

European union plans on the e-Euro (CBDC):

Cross post - better suited in here:

EZB Report on a digital euro:
https://www.ecb.europa.eu/pub/pdf/other/Report_on_a_digital_euro~4d7268b458.en.pdf

edit:


> This report examines the issuance of a central bank digital currency (CBDC) – the digital euro – from the perspective of the Eurosystem. Such a digital euro would be a central bank liability offered in digital form for use by citizens and businesses for their retail payments. It would complement the current offering of cash and wholesale central bank deposits.


Split the money base.


> A possible role for the digital euro as a tool to strengthen monetary policy is not identified in this report, but could emerge in the future on the basis of further analysis or owing to developments in the international financial system.


PR first?


> The Eurosystem would design the digital euro in such a way as to avoid possible undesirable implications for the fulfilment of its mandate, for the financial industry and for the broader economy. Some digital euro design options could affect the intermediation function of banks and their funding costs, especially in situations of stress. Furthermore, some potential configurations of a digital euro could lead to an Report on a digital euro 4 expansion of the size of the Eurosystem’s balance sheet and increase its exposure to shocks and could give rise to challenges in international financial markets related to larger capital flows. However, the analysis in this report indicates that by following appropriate strategies in the design of the digital euro the Eurosystem can address these challenges.


Commercial banks and large scale investors are safe - we promise.
Also promises of not inflating the money pool ("state investments into peoples abilities to purchase retail") (with negative interest you get the desired effects).


> Most users and investors are also concerned that emerging private payment solutions (especially if unregulated) could entail cyber risks.


The boogey man can!


> In the case of a digital euro, such risks might be mitigated by the involvement of the central bank. Finally, the issuance of a digital euro could stimulate the supply of new payment services and functionalities and create business opportunities, although it could also generate new sources of risk.


You know, the commercial banking sector really had too few business opportunities in the past...


> Scenario 4: if the Eurosystem were to conclude in the future that the issuance of a digital euro is necessary or beneficial from a monetary policy perspective. For example, the introduction of a CBDC might reinforce the transmission of monetary policy by allowing the central bank to set the remuneration rate on the digital euro in order to directly influence the consumption and investment choices of the non-financial sector, although the strength of this mechanism is not clear cut18 (the effect of the digital euro on monetary policy is examined in more depth in Section 3).


Bingo.

edit Footnote 18:


> 18 A CBDC could help to eliminate the effective lower bound on policy rates, and thereby widen the policy options available in crisis situations, if cash were to disappear. This may be considered particularly important in view of the decline in the neutral real rate (== cumulative interest). However, to the extent that cash remains available in the economy, this objective becomes less relevant. See Lalouette, L. and Esselink, H., “Trends and developments in the use of euro cash over the past ten years”, Economic Bulletin, Issue 6, ECB, 2018.



Bingo 2:


> Requirement 4 (R4): monetary policy option. If considered to be a tool for improving the transmission of monetary policy, the digital euro should be remunerated at interest rate(s) that the central bank can modify over time.19


Footnote 19:


> 19 There may be other reasons to remunerate the digital euro at a variable rate, namely financial stability reasons and to prevent the central bank becoming a large-scale financial intermediary if the digital euro becomes a large-scale store of value.


Yeah we dont want it to be a value store option, do we.. 


> • The excessive use of the digital euro as a form of investment and the associated risk of sudden large shifts from bank deposits to the digital euro should be avoided. The digital euro should be available via supervised intermediaries, while IT project risks (for example, project delays or unexpected costs) should be minimised. The Eurosystem should aim at complying with regulatory standards even when exempted, unless it is clearly in the public interest not to do so.


Split the money base.




> Effects on the banking sector, monetary policy and financial stability
> 
> The introduction of a digital euro could affect the transmission of monetary policy and have a negative impact on financial stability, for example by challenging banks’ intermediation capacity and by affecting risk-free interest rates. Depending on its characteristics as a form of investment, it might induce depositors to transform their commercial bank deposits into central bank liabilities. This might increase the funding costs of banks and, as a consequence, interest rates on bank loans, potentially curtailing the volume of bank credit to the economy. Banks could react to this trend in different ways. One possibility would be to try to stabilise deposits by increasing their remuneration or by bundling them with additional services (for example, payment services, mortgages, etc.). Second – unless the central bank increases its outright holdings of securities, thus increasing the supply of liquidity on a permanent basis – banks could replace lost deposit funding with central bank borrowing, provided that they have adequate collateral (in terms of both quality and quantity). This would imply an increase in demand for collateral, which might ultimately have an impact on market interest rates for safe assets; moreover, the central bank would expand its role in the economy and its risk exposure. Finally, to the extent that the central bank increases its outright holdings of securities, banks could still try to substitute deposit funding with more expensive capital market-based funding. Substantial demand for digital euro may also have a negative impact on financial stability, given the key role of the banking sector in financial intermediation. Were this demand to increase their funding costs, banks might have to deleverage and decrease the supply of credit, thus preventing an optimal level of aggregate investment and consumption. If this process ultimately implies higher costs for borrowers, economic activity could be hampered. Moreover, if their traditional business model is compromised, banks may decide to take on greater risks in an attempt to earn higher (nominal) returns and to offset the reduction in profitability.32 Additionally, if banks decrease their role in deposit-taking and intervene less in the routing of payment instructions, they might have less information about clients, which, in turn, would harm their risk assessment capacity. This may increase the riskiness of banks’ balance sheets, with negative effects on financial stability. Furthermore, investors may substitute safe assets (for example, sovereign bonds) with the digital euro, which would directly affect risk-free interest rates and indirectly affect other risk classes.33 In crisis situations, when savers have less confidence in the whole banking sector, liquid assets might be shifted very rapidly from commercial bank deposits to the digital euro if the operational obstacles to withdrawing money in the form of digital euro are lower than for withdrawing cash. This could increase the likelihood and severity of bank runs, weakening financial stability. These examples highlight that the design of the digital euro needs to be carefully assessed, taking into account its implications for such important issues as monetary policy transmission and financial stability. Consideration should be given, inter alia, to whether a digital euro should be accessible by households and firms directly or indirectly through intermediaries, whether it would be remunerated, and whether digital euro holdings of individual users should be limited or unlimited. For instance, the central bank might mitigate potential effects on the banking sector, financial stability and the transmission of monetary policy by remunerating digital euro holdings at a variable rate over time,34 possibly using a tiered remuneration system, or by limiting the quantity of digital euro that users can hold and/or transact.


Footnote 34:


> 34 A non-interest-bearing or positive interest-bearing digital euro is more likely to induce large-scale substitution away from deposits in a negative interest rate environment. While banknotes already offer a non-interest-bearing alternative to deposits, storage and insurance costs mean that deposit rates can be below zero without triggering large-scale substitution into cash. Holding digital euro would likely entail lower costs than holding banknotes, implying that large-scale substitution into non-interest-bearing or positive interest-bearing digital euro would be more likely – at any given negative rate on deposits – compared with substitution into banknotes.


Oh, what could we do - what could we possibly do??!?

Next paragraph:


> Given the risks for monetary policy transmission and financial stability, it is not desirable for the digital euro to attract very large investment inflows. However, if individual holdings of digital euro were too low, either because of rigid constraints or because of disincentives applied above a relatively low threshold, then the digital euro would be less attractive as a means of payment and less competitive than alternative instruments.35 To address the aforementioned risks, the central bank should design the digital euro in line with the following requirement:





> Requirement 8 (R8): ability to control the amount of digital euro in circulation.
> The digital euro should be an attractive means of payment, but should be designed so as to avoid its use as a form of investment and the associated risk of large shifts from private money (for example bank deposits) to digital euro.


BINGO! 

edit: Oh, and its green!


> Although the central bank would not aim at expanding its intermediation role, this possibility cannot be ruled out. In this case it could be forced to invest more in illiquid assets, ultimately taking on more credit and market risk. As profitability is not, per se, a policy objective of the Eurosystem, these considerations would have no immediate implications for the design of a digital euro. A central bank issuing a CBDC should nonetheless strengthen its risk management.



edit: This gets better by the minute:


> Requirement 13 (R13): conditional use by non-euro area residents. The design of the digital euro should include specific conditions for access and use by non-euro area residents, to ensure that it does not contribute to excessively volatile capital flows or exchange rates. Such conditions could take the form, for instance, of limits on or adequate remuneration policies for the holdings of digital euro of non-euro area residents.




Better by the minute:

Oh now - we might have to eliminate privacy - because we cant allow to much investment money to cross over. 



> Privacy requirements Users’ privacy can be protected to various degrees, depending on the preferred balance between individual rights and public interest. Means of payments in current use already provide varying degrees of privacy, ranging from anonymous cash transactions to transactions requiring documentary verification or monitoring via bank accounts.46 If the legal identity of digital euro users were not verified when they access services, any ensuing transaction would be essentially anonymous.47 While that is currently the case for banknotes and coins, regulations do not allow anonymity in electronic payments and the digital euro must in principle comply with such regulations (Requirement 10). Anonymity may have to be ruled out, not only because of legal obligations related to money laundering and terrorist financing, but also in order to limit the scope of users of the digital euro when necessary – for example to exclude some non-euro area users and prevent excessive capital flows (Requirement 13) or to avoid excessive use of the digital euro as a form of investment (Requirement 8).




edit: Oh wow! You can even keep petty crime, we only want negative interest. 


> If users are identified when they first access digital euro services, different degrees of privacy can still be granted by both the issuer (the Eurosystem) and the providers of intermediary services. Full privacy would be typical of offline digital euro payments, in line with Scenario 2 (a decline in the use of cash), even when users have been identified by the provider(s) of digital euro services beforehand. Indeed, the absence of a data connection with a third party implies that sharing transaction data is not necessary for payment settlement.



edit:


> One option to be investigated would be to allow users to hold digital euro only up to an individual threshold at any given time. To ensure that a user can always receive a payment in digital euro and no information is disclosed on current individual holdings, a “waterfall” approach would be possible whereby any incoming digital euro in excess of the holding limit would be shifted automatically to the payee’s account in private money. However, this would require all payees to hold such an account.49


Dont worry, our next monetary policy only concerns your "overflow income". 



> Demand for a digital euro could also be controlled through incentive schemes under which less attractive interest rates or service fees are applied when individual holdings exceed the aforementioned threshold.


Be creative with negative interest rates to increase compliance. 



> It does not seem feasible, under current circumstances, to offer unlimited holdings of digital euro to corporate entities at zero interest rates. In line with the current monetary policy stance of the ECB, the nominal remuneration rate of risk-free euro investments (for example AAA-rated government bonds with a short residual maturity) achievable by corporate entities and domestic and international investors is currently below -0.5%. Unconstrained access of these entities to a digital euro could not be offered currently at more attractive rates without disrupting financial flows and the monetary policy stance.


Lets start at -0.5%. 

edit: In case a more 'anonymous' private payment option is needed (classified as cash use declines), you might have two models of the digital euro. One based on a balance sheet ('bank account') held by the ECB, and one based on 'distributed ledger' - both holding 'e-Euro'. In the second case, you would be loosing ECB liability in the instances of loss of device, or fraud.

Most of daily e-Euro transfers in 'offline mode' (without privacy loss) could even be ensured, by "hardware security modules" on "registered devices".


> An electronic payment that is not confirmed online – either through the network of users or in a central register – can still be considered final by relying on “trusted hardware” modules. Offline functionality avoids the sharing of transaction details with parties other than the payer and payee, enabling the digital euro to become a complement to cash (Scenario 2) and providing a back-up payment solution that is available in extreme situations (Scenario 5).53 These modules are increasingly available to potential digital euro users in the form of smart cards, mobile devices and payment terminals. The payment could be settled immediately as a transfer of pre-funded units between the devices of payer and payee. Payment devices could be pre-funded with an amount of digital euro deducted from the balance that a user has online before they are used offline. The trusted device would contain the current balance and adjust it upon payment by the user. On the side of the payee, usually equipped with a terminal, the transfer would be recorded with the necessary information to prove that the transfer was indeed finalised.


Bye by people owning their phones (rooting them).

edit:


> However, the remuneration applied to a digital euro stored offline could not be changed by the central bank over time since it would not be possible to communicate with the device (Scenario 4). Moreover, a digital euro that is only usable offline would be unlikely to support new advanced functionalities such as conditional payments (Scenario 1). An offline digital euro would need to exist online at some point, in order to allow users to load money onto the offline digital euro wallet through the broader payment system; hence, any offline digital euro should also be linked to an online form of digital euro.54



edit: Also interesting:


> As already mentioned, remuneration could be tiered, with different interest rates applied in different cases. This would, for example, allow the Eurosystem to pay less attractive interest rates on large holdings of digital euro or on holdings by foreign investors in order to discourage excessive use of the digital euro as an investment or to mitigate the risk of attracting huge international investment flows.



edit: Remuneration of digital offline money (cash equivalent), although technically difficult - might not be out of the question;


> It could be argued that the non-remuneration of banknotes creates unintended effects, as the opportunity cost of holding banknotes varies with central bank and market interest rates. From this perspective, it would seem natural to overcome this constraint once technology allows the central bank to remunerate its money. However, designing a digital euro that is available offline would face additional challenges if it was remunerated.


---


edit: According to an 'educated opinion' on part of a member of the Konrad Adenauer Stiftung - at least for a potential implementation the possibility to issue 'negative interest rates' on different parts of the money pool will be played down. Also there are different possible implementations concerning overcoming a concept called zero lower bound.

Basically, the notion, that if you raise negative interest it in general, people will flee into cash. The less cash is used, the lower the likelyhood of that problem occurring. The expert told the interviewer, that because of the zero lower interest bound negative interest rates as a monetary policy means would not be likely. There are some people working on scenarios to overcome it. Also there is significant 'opportunity cost' for trading digital currency into cash - so I doubt that the effect would instantly manifest itself in reality.

src: h**ps://www.youtube.com/watch?v=08guZbfhW14 (german)


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## tabzer (Dec 17, 2020)

Hi.  Nice rally we are having now.  Any predictions?


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## notimp (Dec 17, 2020)

tabzer said:


> Hi.  Nice rally we are having now.  Any predictions?


What is best. What should I buy. Random guy on the internet, help me spend my money.

To gain money.


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## tabzer (Dec 17, 2020)

Buy Kin.  Though I like Tezos better, Kin is in its recovering reputation phase and may just get a lot of good leverage on the coming shitcoin rally.


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## notimp (Dec 17, 2020)

tabzer said:


> Buy Kin.  Though I like Tezos better, Kin is in its recovering reputation phase and may just get a lot of good leverage on the coming shitcoin rally.


Anyone understand this babble?


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## tabzer (Dec 17, 2020)

I do!

https://coinmarketcap.com/currencies/kin/

Bitcoin is bitcoin and shitcoins are all other crypto.  Kin is pretty close to the lowest price of all time.  It was a project spearheaded by Kik.  It hit its lowest because of a SEC lawsuit determining it to be a securities offering.  They settled with a fine about a couple months ago, which releases them from being in SEC's crosshairs and have recovered only a little since then.  They have been working on scalability by "migrating" their crytpo to more capable blockchains.  I figure that if you want to invest in crypto, it's the lowest risk/greatest reward pairing.


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## notimp (Dec 17, 2020)

tabzer said:


> I do!


How much is 'finished reputation management' worth?

And why should I be politically interested?


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## tabzer (Dec 17, 2020)

Political apathy is the interest, so it is at odds with any government trying to limit its legal use.  But then again, some political alignments might boost its appeal, even if temporarily.  Like, Biden's for example.  Trump has always spoken against bitcoin, but I figure that's lip-service in his fight for the American dollar.  I don't think he's actually taken any steps to try to stop bitcoin.

finished reputation management?  I'm not sure if that's just poor framing.  IMO, the worst for KIN has already happened, and it plans on sticking around--which translates to appreciation.

I'll mark it for later.  Now KIN is worth 0.000037


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## notimp (Dec 17, 2020)

You crack me up. 

Some of the goldbug conspiracy platforms (with FUD tendencies) also used gamification to bind their clientel, and make them spokespeople for the cause. Beats paying them minimum wage.

Sure you are not stuck in one of these schemes?


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## tabzer (Dec 17, 2020)

Nah.  I've been playing with it and speculating since early 2012.  I want to be the master of my own universe, so I am strongly against selling my representation (or pledging an allegiance).

TBH, this is the first time I really made any recommendations.  I never wanted people to suffer because of my advice.  Now it's getting to the point where people will suffer anyway, and my advice would be better than that.

--------------------- MERGED ---------------------------

One point I forgot to mention, is that when Bitcoin finishes rallies, it is usually transitioned into shitcoin rallies.  They are hit or miss, but usually the ones that are "undervalued" are the ones that do crazy shit, making something like KIN to be the "unsuspecting" target.  Might be Ripple or XLM again, but they are too close to Bitcoin IMO.


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## iuraf (Dec 22, 2020)

They are a risky market, but if you know what you are doing, you can make profits. I would suggest to firstly invest in something more light, like a stable bank. But the most important thing is to learn how to stop spending money. I've found about this https://www.juststartinvesting.com/how-to-stop-spending-money and let me tell you that I've shifted my perspective regarding money. Investments are always a good thing, but you should be very wise with your money


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## Deleted User (Dec 23, 2020)

I have a few questions:
1a. A Bitcoin Wallet is needed, right?
1b. Which Bitcoin Wallet (physical?) Is recommended?
2. What is a reliable website to invest through?

From reading everywhere, I've come to the conclusion that investing in Bitcoin is better than in USD/GBP/EUR (I considered USD and GBP, but EUR? Not a chance.).

I really want to begin using Bitcoin as I should have done so years ago.


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## tabzer (Dec 23, 2020)

1a.  Yes.  Software or Hardware.  Definitely recommend Hardware.  If you don't want to be the one who is holding your bitcoin, you can leave them on an exchange.  It's up to you to determine which is riskier/safer.  Bitcoin's history has had a long history of exchanges going under, or making exit scams, taking people's bitcoin with it.  These days, more reputable names are entering the market. 

1b.  Ledger or Trezor.  Ledger has horrible track record of leaking customer data (with customers getting death-threats) , but their hardware/software is good.  If you order from them, try using throwaway details, (e-mail too) pay with cryptocurrency, and maybe rent a PO box.

2.  IDK if it's the best for UK residents, but Coinbase is good.

https://www.reddit.com/r/CryptoCurrency/
https://www.reddit.com/r/Bitcoin/
https://www.reddit.com/r/ledger/
https://www.reddit.com/r/TREZOR/
https://bitcointalk.org/

You should really do your own research and not rely on the message of any single person.  Even though I strongly dislike reddit, these are good places to start, and gather information.


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## Deleted User (Dec 23, 2020)

tabzer said:


> 1a.  Yes.  Software or Hardware.  Definitely recommend Hardware.  If you don't want to be the one who is holding your bitcoin, you can leave them on an exchange.  It's up to you to determine which is riskier/safer.  Bitcoin's history has had a long history of exchanges going under, or making exit scams, taking people's bitcoin with it.  These days, more reputable names are entering the market.
> 
> 1b.  Ledger or Trezor.  Ledger has horrible track record of leaking customer data (with customers getting death-threats) , but their hardware/software is good.  If you order from them, try using throwaway details, (e-mail too) pay with cryptocurrency, and maybe rent a PO box.
> 
> ...


Thank you.

Bitcoin to me is still relatively new and the reason I asked was because I don't even know where to search for this kind of info.


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## notimp (Dec 28, 2020)

Follow up to the Cory Doctorow posting linked in here:



> *China orders Alibaba's Jack Ma to overhaul Ant fintech business*
> China's central bank has asked Ant Group, the world's biggest fintech firm, to shake up its lending and consumer finance practices and comply with regulatory requirements.


src: https://www.dw.com/en/china-orders-alibabas-jack-ma-to-overhaul-ant-fintech-business/a-56070639


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## Deleted User (Dec 28, 2020)

It all goes back to why any Currency is valuable; the fact that both parties trading agree there is value in said Currency.

Historically, we as a species have used shells, underwater stone statues, precious metals and paper as Currency, so the value of each in and of itself have changed through the years except for precious metals, leading to the fact not every representation of Currency has to be valuable per se.

Cryptocurrency relies on the fact that there are financial entities willing to accept it for trade and back that up with normal Currency. It's as simple as that as to why it has value.

The gambling aspect is as simple as that the amount of normal Currency said entities are willing to back it for is volatile; all Currencies are volatile to an extent, but our standard Currencies are backed by trust between nations. A simple example is the United States' Dollar; the country is the World's largest debtor but all of the countries acting as her creditor believe in her economic potential and thus the value of her Currency is based on that belief.

We've long past the Gold Standard era, meaning that there is more money available than the worth of all the Gold a country has, so money practically has no value. It is now purely an economic construct, but one that is balanced by trust between countries for a future time when books will be balanced.

When you understand that, then Cryptocurrency really isn't any different from a theoretical standpoint.

The biggest difference comes back to its much more volatile value and what a gamble it is to invest in.
So I don't recommend it unless you have more than passing knowledge of it and better-than-average luck.


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## notimp (Dec 28, 2020)

tomasowa said:


> Historically, we as a species have used shells, underwater stone statues, precious metals and paper as Currency, so the value of each in and of itself have changed through the years except for precious metals, leading to the fact not every representation of Currency has to be valuable per se.
> 
> Cryptocurrency relies on the fact that there are financial entities willing to accept it for trade and back that up with normal Currency. It's as simple as that as to why it has value.


Shells and underwater statues are backed by consumer demand ('scarce resource'), precious metal is backed by countries holding reserves of those (buying them out of the market for price stability - f.e.) and them being scarce, paper as a currency is backed by a country giving guaranties, that that paper can be spent for the value on the paper, and accepting it for tax payment purposes (legal tender).

Crypto currencies are none of the above. But they are easily tradeable (at least in large amounts, if you let a transaction take three days until its verified). They are scarce for as long as major players dont get into a room and get a consesus to fork the currency. They arent stable. They arent in demand (for anything other than financial speculation - yet). They arent backed by governments.

The entire scene is "hopefulls" in "talent pools", being acquired by entities that 'want something modern' and dont have better talent aquisition structures (Thats the everyone is talking about it, because its hip part).

And a marketing play banking on 'more morons will find it attractive soon' - hence, new players in the transaction space, bet on more people wanting to use that form of 'value transaction' in the future, partly because they make it more accessible.

So the 'financial entities' accepting trade values into more conventional currencies, are people wanting programming and management talent with not that much knowledge and no scruples, marketing entities, and dumb people stuck in a snowball system (individual miners, used as PR assets). Also larger foreign actors trying to flee state taxation (not in the EU or the US; as there are cheaper methods), as well as even less legitimate interests.

The entirety of the bitcoin story culminated into 'oh, now Paypal supports it' now we legitimate!


----------



## Deleted User (Dec 28, 2020)

notimp said:


> Crypto currencies are none of the above. But they are easily tradeable (at least in large amounts, if you let a transaction take three days until its verified).



This is a misnomer and paradoxical; for it to be tradeable there has to be a financial entity willing to back it into normal Currency.
That said, I do agree that it should not be a recommended way to make money.


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## notimp (Dec 28, 2020)

tomasowa said:


> This is a misnomer and paradoxical; for it to be tradeable there has to be a financial entity willing to back it into normal Currency.
> That said, I do agree that it should not be a recommended way to make money.


There are, but the financial entities are early bird speculators, financial investors at larger scale financial entities, but also just within their speculation departments. And people running those schemes, for the talent pool, that gets attracted to it. As well as people wanting to make money in the transaction process (paypal f.e.).

Now thats my storytelling, and part of the question that remains is, "isnt that always the case - when something new is created - to some extent", and when is the jumpoff point, to it becoming more than that. (Speculation.)

And the answer I've made up in my mind is, that - if you want those currencies to be vehicles to attract talent, you need those oscillating price curves - because those people are interested in potential. And if you want for it to become the new digital gold. you cant have those, and the entire thing gets boring AF. And there is no reason to believe that those currencies will be statebacked anytime soon (national banks spin up their own initiatives, or partner with facebook coin in the US (facebook coin isnt 'crypto'). And there is no reason to believe that any of this will produce compound growth.

Also the issues are manyfold. With POW you have transaction speed and energy consumption issues.
With POS you bake in even more pyramid scheme, than with POW (no 'generational' reward for becoming better, just invest large early and stick to it).
For it to become a legal currency in use, you dont need the decentralized part (use central servers - higher transaction speed).

So wtf.

On the 'people want it' side, national entities usually want to see the transaction record (possible if public), but that could as well happen serverside, and therefore be 'more privacy providing' to most users (depends, privacy from whom..). And digital payment solutions can be created without much crypto decentralization at all. (See Jack Ma.)


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## notimp (Jan 2, 2021)

Huh - the crazy tech yes city guy, just taught me something I didn't know.


There are asic resistant crypto currencies. Thats at least interesting, because it solves a structural issue. (In terms of keeping stakes distributed.)

Doesnt mean anything on its own, but I didnt know that.

edit: Also, in a strange way, doesnt that mean, that mining never should get bigger than gaming?  I'd love to get Nvidias opinion on that matter.. 
edit2: Also, while still in crazy territory, how would that pan out in a world where energy costs trend towards zero?


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## notimp (Jan 13, 2021)

Bank of Canada (central bank) led panel on Monetary Policy for Decentralized Currencies:


Can be seen as PR for a national banks perspective, but I like the framework, and find the presentation convincing. 

Also - for global coordination of monetary policy - see:
https://gbatemp.net/threads/what-is-monetary-policy.580717/


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## ClancyDaEnlightened (Jan 14, 2021)

Boesy said:


> I have a few questions:
> 1a. A Bitcoin Wallet is needed, right?
> 1b. Which Bitcoin Wallet (physical?) Is recommended?
> 2. What is a reliable website to invest through?
> ...




Yes I recommend using an offline wallet, I recommend downloading bisq 


I use a bitcoin atm, depending on where you live you might actually have a few, atms are better if you don't want a "papertrail"


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## notimp (Jan 16, 2021)

Should give you some additional insight:
https://crypto-anonymous-2021.medium.com/the-bit-short-inside-cryptos-doomsday-machine-f8dcf78a64d3

Thats promotion for money laundering 'into USD' then i guess.  So everything is still fine from the US points of view. *sarcasm*

Well, despite a private company minting a USD equivalent at the moment..  At least they are saying they are... 

edit: Hacker news comments thread:
https://news.ycombinator.com/item?id=25788409


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## Jayro (Jan 16, 2021)

Invest in crypto > Sit on it for some years > ???? > Profit.


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## JoeBloggs777 (Jan 16, 2021)

Jayro said:


> Invest in crypto > Sit on it for some years > ???? > Profit.



as long as you don't forget your password 

https://www.nytimes.com/2021/01/12/technology/bitcoin-passwords-wallets-fortunes.html?smid=tw-share


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## smf (Jan 16, 2021)

Jayro said:


> Invest in crypto > Sit on it for some years > ???? > Profit.



step 1, invent time machine and go back to when bitcoin were <1$


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## delikana (Jan 16, 2021)

Speaking about cryptocurrency and investments in it, you need to take into account that this market is just beginning to develop. Despite the fact that bitcoin is already worth fabulous money, this is not its limit. Many large organizations are still only looking at investing in cryptocurrency.
I am interested in cryptocurrency too. For me, this is a way to save my money. This is especially true during a pandemic. I found a large list of cryptocurrency exchangers and buy ripple. I am currently researching a satoshi purchase poll.


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## notimp (Jan 18, 2021)

delikana said:


> Speaking about cryptocurrency and investments in it, you need to take into account that this market is just beginning to develop. Despite the fact that bitcoin is already worth fabulous money, this is not its limit. Many large organizations are still only looking at investing in cryptocurrency.
> I am interested in cryptocurrency too. For me, this is a way to save my money. This is especially true during a pandemic. On BestChange I found a large list of cryptocurrency exchangers and buy ripple. I am currently researching a satoshi purchase poll.


You working for RT (Russia Today) also, by any chance? 
https://bitnewstoday.com/news/sbi-h...ks-partner-how-will-ripple-benefit-from-this/

Second question - are you especially interested in the Malaysia - Bangladesh work exchange program, and especially the tax avoidance part of it?
https://www.coindesk.com/ripple-malaysia-bangladesh-remitance

Third question: Do you like dealing with companies, that are in legal trouble with the US?





> The partners do not seem deterred by Ripple’s legal troubles in the U.S. The company is being sued by the U.S. Securities and Exchange Commission over the claim it violated federal securities laws by selling the XRP (+1.25%) cryptocurrency to retail consumers.


https://www.coindesk.com/ripple-malaysia-bangladesh-remitance

Fourth question, do you like foreign currency acquisition schemes, that sell people bits on computers and the hope, that they will rise in value quickly?+

Fifth question: What makes ripple a crypto currency?
https://old.reddit.com/r/CryptoCurr...ple_is_a_pos_noncrypto_all_newbies_should_be/
https://www.quora.com/Why-is-Ripple-centralized


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## Deleted User (Jan 19, 2021)

What's your guys opinion on Revolut and CashApp to invest in Bitcoin?


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## tabzer (Feb 24, 2021)

tabzer said:


> I'll mark it for later. Now KIN is worth 0.000037



Currently KIN is sitting at 0.0001179, which, at this point, makes my the only other investment advice I've ever made (besides telling people to get into bitcoin when it was $25) fucking awesome.  I imagine it will drop for a minute, and then go back up but who knows.  I honestly don't know if you should buy now or not.  It's a sleeper.  I love giving people good advice that they ignore, even though I work so hard to make sure I don't give bunk advice.

I actually like KIN, because unlike Bitcoin (which I love), it has migrated blockchains 3 times--which shows that it is chasing scalability in a way other cryptos do not.


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## Luke94 (Feb 24, 2021)

To please Elon Musk and Bill Gates?


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## tabzer (Feb 24, 2021)

Personally, I think Bill Gates is aiming at his own cryptocurrency because he wants to rule the world.  Elon, however, will shill whatever he thinks will get him major gains because he likes to play.  Bill Gates has a dead spirit while Elon is flirty.


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## Luke94 (Feb 24, 2021)

tabzer said:


> Personally, I think Bill Gates is aiming at his own cryptocurrency because he wants to rule the world.  Elon, however, will shill whatever he thinks will get him major gains because he likes to play.  Bill Gates has a dead spirit while Elon is flirty.


I heard Bill Gates wants to vaccinate all people. Probably with all costs.


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## Goku1992A (Feb 24, 2021)

I made $200 off of Dodgecoin my only regret was pulling out of bitcoin when it was $5000 at the time. I could have made made a $4500 + profit off my inital $500 investment.


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## tabzer (Feb 24, 2021)

Luke94 said:


> I heard Bill Gates wants to vaccinate all people. Probably with all costs.



It seems so.  I am adamantly against Gates.  He is more of a thief, and not as much of a genius as the media seems to want to purport.  I doubt his IQ is actually 160, but I will acknowledge that he is cunning.



Goku1992A said:


> I made $200 off of Dodgecoin my only regret was pulling out of bitcoin when it was $5000 at the time. I could have made made a $4500 + profit off my inital $500 investment.



I won't tell you how many times I have been ripped off and cheated of my potential earnings.  (I guess I just kind of did lol)  The potential earnings are nothing.  You either did or you did not.  You can only start with now.


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## Luke94 (Feb 24, 2021)

Well Bill Gates was former founder and CEO of Microsoft.


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## tabzer (Feb 24, 2021)

Luke94 said:


> Well Bill Gates was former founder and CEO of Microsoft.



Yes, and he pretty much stole Xerox's GUI to get there.


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## Luke94 (Feb 24, 2021)

tabzer said:


> It seems so.  I am adamantly against Gates.  He is more of a thief, and not as much of a genius as the media seems to want to purport.  I doubt his IQ is actually 160, but I will acknowledge that he is cunning.
> 
> 
> 
> I won't tell you how many times I have been ripped off and cheated of my potential earnings.  (I guess I just kind of did lol)  The potential earnings are nothing.  You either did or you did not.  You can only start with now.


Well I guess he's not such smart like Albert Einstein was. I heard conspiracy theory that Queen Elisabeth the Second is eating raw human meat/flesh within dose of adrenochrome. I heard she is cannibal. Is it truth? Speaking of Covid-19 conspiracy theories.


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## Deleted User (Feb 24, 2021)

Luke94 said:


> To please Elon Musk and Bill Gates?


iirc Bill Gates is actually against cryptocurrency


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## Luke94 (Feb 25, 2021)

Azerus_Kun said:


> iirc Bill Gates is actually against cryptocurrency


Will cryptocurrencies be new digital currency for digital vaccination certificates passports or more like related to vaccines Bitcoin payment for Agenda 2030?


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## Luke94 (Feb 26, 2021)

CrySmile said:


> Cryptocurrency is a very popular topic these days. Today, everyone bites their elbows due to the fact that they did not buy bitcoin in due time. A friend of mine mined bitcoin 10 years ago, he had 200 coins and sold them when the rate reached about $ 200-250 per coin. He remembers this every time we meet. Now mining bitcoin no longer makes sense without large investments in equipment. Plus, the electricity price makes this business profitable only in certain countries. Investing involves risk, which is why I buy low-cost altcoins. If I lose money, it’s not much. Stellar has been showing good results lately https://stellar-wallet.org/arts/stellar-xlm-new-alternative-crypto.html. The coin has grown in value 5 times in 3 months. This figure is higher than that of Bitcoin.


Thanks to Elon Musk I guess. I heard he will be working this Year on testing human microchip of his Neuralink quantum computing Project that he tested on animals before.


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## kosterix (Mar 4, 2021)

Luke94 said:


> Thanks to Elon Musk I guess. I heard he will be working this Year on testing human microchip of his Neuralink quantum computing Project that he tested on animals before.



Discussing politics on fora is dangerous, but I heard a guy say on tv that bill gates donated a lot to organizations in Africa, but invested far, far more into businesses that are very bad for Africa.
If this is true, and I'm confident on the first part, Bill gates is much worse than your average thief.


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## Luke94 (Mar 4, 2021)

kosterix said:


> Discussing politics on fora is dangerous, but I heard a guy say on tv that bill gates donated a lot to organizations in Africa, but invested far, far more into businesses that are very bad for Africa.
> If this is true, and I'm confident on the first part, Bill gates is much worse than your average thief.


Well I'm not thief. Yeah even on Sonic Retro forum(I guess they prefer to avoid political discourse) and for Epic Tencent Games discussing politics is rather taboo subject.


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## tabzer (Apr 1, 2021)

tabzer said:


> I'll mark it for later.  Now KIN is worth 0.000037



KIN is at $0.0003621 which is 978% from the time I gave the advice.  I wonder if anyone took it.


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## Deleted member 397813 (Apr 1, 2021)

to be a gamer


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## depaul (Apr 30, 2021)

With crypto currencies, you can really gain money very fast (like x10 in one week or one day in some cases).
But likewise, also a lot of traders actually lose their investment very quickly, like losing 10.000$ overnight because of some political statement... Statistics say that 90% of traders lose money and fail.

Beware of some dangerous practices in crypto: sometimes a lot of dishonest traders agree to buy a specific coin and its price rises drastically... pushing ordinary people to buy as well believing the coin is doing good... at a specific date all of the dishonest traders sell simultaneously taking profit and dumping the coins price very low..wasting all of the investment made by others.


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## solomosh (Apr 19, 2022)

For me, the cryptocurrency market is quite an elephantine topic. I would prefer fiat money or shares


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## tabzer (Apr 19, 2022)

solomosh said:


> For me, the cryptocurrency market is quite an elephantine topic. I would prefer fiat money or shares


Shares, okay.  But why fiat?  Unless you are expertly playing the currency exchange market it is a guaranteed loss in value due to inflation.


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## Luke94 (Apr 24, 2022)

So how to make for instance as an example especially considering these days nowadays Jazz Jackrabbit videogame industry NFTs' would CCP,Tencent,People Can Fly and Epic Games allow me that or would it be rather more opensource,homebrew,fangame unofficial,bootleg? Cringe,worthy,infamous,controversial Ken Penders as one of former writers and artists of Archie Sonic(the Hedgehog)Comics did that I mean he's doing this right now.


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## FAST6191 (Apr 25, 2022)

Did you post drunkenly into a machine translator for that?

NFTs are just a boring case of smart contracts. Find whatever crypto you like that does smart contracts (ethereum probably being the default https://ethereum.org/en/developers/docs/smart-contracts/ ) and draw a contract saying the owner of this token is the owner of this piece of artwork with this hash/this link/whatever you care to do for this. Sell it however you will and transfer the token to the address provided by the purchaser. Some NFT selling/exchange platforms might specify a given crypto and format for it all to happen in, possibly whilst providing a contract template for it all to happen in (taking a stab in the dark I would guess you are neither a contract lawyer nor a copyright lawyer), but you don't have to use any of those.
They can then sell the token on, or admire it, or use it within whatever rights the contract gives them (right of reproduction being the most likely sticking point).

Said artwork can be whatever you like, though in your case if you made some fan art with jazz jackrabbit as you say you might get a knock at the door from whoever owns the copyrights and/or trademarks (if there are any) these days.


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## appleburger (Jun 2, 2022)

This is still the best comprehensive overview of NFT's and Crypto that I've come across so far, for those who want a crash course:



Obviously keep in mind that Folding Ideas is controlling the narrative and is highly critical of cypto, but he does a fantastic job of laying out how crypto works and why he takes his positions.  It's a great starting point for those looking to get a high level view of what's going on in this space.


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## WG481 (Jun 2, 2022)

Don't invest in crypto very seriously. It will crash. Hard. Or an exit scam will happen.


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## JoeBloggs777 (Jun 2, 2022)

soon could be the time to buy, prices have already dropped alot, sure there could be another 50% drop, who knows, what if there isn't. but the state of the world at the mo, I'm sure they can still go lower.

sol had a ATH of $260 now $41, ADA ATH $3 now at $0.60, people who got wrecked were ones who bought near ATH.


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## FAST6191 (Jun 2, 2022)

JoeBloggs777 said:


> soon could be the time to buy, prices have already dropped alot, sure there could be another 50% drop, who knows, what if there isn't. but the state of the world at the mo, I'm sure they can still go lower.
> 
> sol had a ATH of $260 now $41, ADA ATH $3 now at $0.60, people who got wrecked were ones who bought near ATH.


There is a phrase in general investing along the lines of time in the market beats timing the market. Though whether this is a bottom or usefully so I am not sure and would not place too terribly high odds on anyway (another scandal, more on those shortly, and it could see some further fear and margin calls).

Anyway since last/earlier posts I should probably add I would not seriously touch anything that claims to be pegged or directly related to a pegged currency -- nobody is going to have a proper one at this point, at best it will be pegged with junk bonds (want to buy some of my Chinese housing market bonds?) and algorithmically pegged is better replaced with ponzi scheme (if the US government can't get away with money printer not causing inflation then why would some nerds with a computer network?). Gamble on them/you not being the greater fool if you want but you could probably do better playing arbitrage on more well known efforts like bitcoin and Ethereum.


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## JoeBloggs777 (Jun 2, 2022)

FAST6191 said:


> There is a phrase in general investing along the lines of time in the market beats timing the market.



your right there, trying to time or beat the market you would probably  miss out, you could keep waiting for the prices to drop further, but there will be a point where they will stop dropping and  some will 5 x or whatever very quickly.

eg last year Ada was what $0.20 and shot to $1 at the start of the year.  I'm sure many people who bought ADA paid btw $1.20 to $3 and have watched it fall in horror to $0.60

better to  buy at $0.60 than $1.20 to $3.

but it looks like a recession is coming so maybe in a few months it will be back to around $0.20


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## Marc_LFD (Jun 29, 2022)

I am fully aware since the moment I stepped into it that it was a risk/gambling and do I regret now? No.

Things are looking pretty grim, but I'm going to hope for the best and that it recovers. The whole point I gave BTC a shot is because I've stopped trusting the fiat currency.

Investing in gold would have been a better option.

By the way, my sister's boyfriend plays a phone where he wins BTC although it's pretty worthless, and chances are he doesn't even have a hardware wallet to hold it in. He thinks he could get rich off of it. I'd bet he's not even aware what has happened to BTC currently.


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