I’m curious how bullish they were after the crash a few years ago.

I appreciate the glossary

> ^1 In May 2020, we became a remote-first company. Accordingly, we do not maintain a headquarters.

Total tangent here, but every time I fill out a really old-school form (e.g. loan stuff), it asks for my company's address and phone number. It gets harder every job to figure out what the hell that number should be. In my last job I has to give out one of the founder's cell phone numbers for it.

Coinbase is a YC company, and if some of the predictions are accurate, will be the highest valued YC company so far.

Many (most?) of the conversations I see on here around crypto are copiously littered with straight FUD. Very little arguing on the actual nuances and intricacies of crypto. Seemingly low understanding / imagination of the possibilities allowed by the underlying concepts. Histrionics about power consumption in every thread.

Disclosure: I liquidated my crypto positions last year, and currently hold $0 worth of cryptocurrency.

It's already the leader by a long shot on network effects, stakeholders would be insane to squander that by letting other projects beat it technologically.

Obviously it can't move as fast as a smaller project (just like a large co vs a startup) but it will absolutely die if it doesn't move at all.

I view Bitcoin a lot like a company. Right now network security is paid for by inflation (issuing new coins), similar to a startup operating with VC money.

At the very least bitcoin must increase transaction volume so it can increase fee revenue without ridiculous individual transaction fees.

Because ASIC vulnerability has led to the concentration of the majority of the world's mining power among a small number of organizations in China, and because the amount of power consumed securing the blockchain with PoW is silly and ever-increasing.

> There are other crypto projects that can fill in the holes that Bitcoin leaves (tx fees, slow, etc).

It's not just about filling holes, other cryptocurrency projects are superior technologically in every way. And since Bitcoin has been demonstrated to be impossible to modernize this gap will only become more extreme over time.

Bitcoin remains the locus of the cryptocurrency movement through network effects alone, which is why evangelists are so adamantly in favor of Bitcoin specifically. If it loses its throne as the "main" cryptocurrency it will never increase in price to the value that Bitcoin speculators are hoping because other than its network size it has no advantages.

> It needs to WORK, and work very well, which it has demonstrated.

I think it has categorically demonstrated that it does not work, at least not for the purpose that the original Bitcoin paper laid out. The fact that Bitcoin transactions are slow and expensive has so compellingly demonstrated that Bitcoin cannot be a useful cryptocurrency that even Bitcoin advocates admit this and have fallen back to claiming that it will instead be a store of value and that an effective currency layer could be built on top of it.

Not to diminish Coinbase's work of course, they're dealing with a ton of international regulation. Their trade is probably more a legal one than a software engineering one.

> (4) [..] held by entities affiliated with Andreessen Horowitz, as reflected in footnote 9 [..]

footnote 9 attributes the shares to him and a variety of funds

You get a free financial system, just without the monetary policy until the country can get moving again.

BTC doesn't provide any value whatsoever as it's by design a terrible medium for exchange, and not a very good store of value.

There is no situation where BTC is useful whereupon there are not already many better solutions.

We have already seen it. We know how it goes.

We saw it in the 1920s. It was horrible. It permanently scarred many of our great grandparents, and even left scars on our grandparents (because they grew up learning vivid horror stories of it). Seriously it was so bad that it took multiple generations to recover from.

Then we saw it again to a portion of our financial system just a decade ago. Luckily we learned from our mistakes and prevented total collapse, but we still saw how vulnerable the system is. Everyone here remembers that, it was only a decade ago.

No one wants to see the system collapse. I think what people are really thinking is they want to create a system that theoretically can't collapse. We are aware of how fragile our current banking system is. Crypto originally sought to create a system that removed the two main wildcards in the financial system (the Fed and the Banks).

Now we replaced Wells Fargo with Coinbase. So we aren't much closer to our goal. We replaced NASDAQ with Bittrex. We replaced the Fed with unregulated ICOs and Miners (if that's even a thing anymore).

I rarely hold any cash on my person and typically pay for everything with my iPhone, otherwise with a physical CC. If the merchant has no power or a broken machine, I cannot make the purchase.

This literally happened to me a few weeks ago while buying a slice of pizza ($5 or less). My phone had power so I offered to Venmo the owner instead but they said no.

Bitcoin and other P2P apps starting with Napster were the subversive and populist tech that was built on a military industrial network.

I would say the culture and ethos of programming was subversive, the home computer market somewhat so as well. But the internet solidly originated within the establishment and was part of the cold war.

It's the second time I'm doing this, the first time I had to spend the money on moving but those were mostly mined coins.

Please share which asset class has value without humans valuing it? If earth was to be wiped out of its human inhabitants, would any asset have any value in human terms? The Indian Rs 500 note lost value instantly as soon as it was banned, just as the German Reichsmark did through inflation. Tribal humans used seashells and beads as currencies. Their belief was no different than your belief in Apple or USD, and my belief in Bitcoin :)

Energy : The power that nation states derive from printing money aka foreign interventionism, military, inefficiency in all processes etc. is likely orders of magnitude higher. BTC energy consumption is concerning but shouldn't be viewed in a void.

Tether afaik is a nothing burger and will not hurt BTC valuation.

I'm guessing their fees draw heavy inspiration from price skimming [0] (which is used heavily by AWS), as it allows them to maximize revenue while consumer demand is high in cryptocurrencies.

0: https://www.investopedia.com/terms/p/priceskimming.asp

I know China gets a lot of flack for doing the same thing but maybe they are right? Better to have a local company do well and contribute to the local economy than to send profits overseas and be subject to global corps.

Kraken doesn't keep sessions alive very long, whereas I can keep coming back to my Coinbase tab the following day and it will still have a session. 2-factor authentication is optional with Coinbase, but Kraken requires 2-factor and only allows an authenticator app or Yubikey(i.e. not mobile which can be intercepted). The Kraken app uses API keys that you set up rather than username/password; this allows the user to set login permissions in case they want their mobile app to only read their balances but not buy/sell. I'm sure I'm missing something.

The added value of that security can certainly be questioned, but I don't think it's unreasonable to say that Kraken is more secure by default and provides more options for keeping one's account secure.

If BTC was more stable and you'd like it then, it implies you are likely a late stage investor here. Volatility comes with price discovery. The publicity and speculation come and go but build on each other over time. We're conflating the short term volatility and hype cycles with long term value, and if you only focus on the former it is like missing the forest for the trees (my opinion).

I am not a BTC purist, and think Eth has its place too. If that connects with you better, cool! Who knows if BTC will die and ETH is the future of crypto. ETH is more volatile objectively, but if your belief in ETH makes you hold through the cycles, more power to you.

I’m not current on the nomenclature, apparently.

I’m calling it a NoPO for no public offering.

Suppose I bought $10,000 of BTC 8 years ago. The only reason I would have done so would have been for speculation, because I don't need to buy drugs on the internet, I don't need to send remittances to, (to use a shorthand) some 'other' country[1], and just like how I don't want to churn my own butter, I don't want to be my own bank.

Had I done so, I can safely predict, knowing everything I know about my psychology and temperament, I would not be a Bitcoin millionaire today. I would have closed my position at any one of a million points in between then and now.

It's a pretty easy temper on FOMO.

[1] To use a long-hand, that country would have to be legal for me to send money to, have a functioning and nearly-always-on internet system, and have a robust network of local bitcoin-for-cash money lenders, while also being almost entirely disconnected from traditional international banking.

Also, the chain won't have to be a store of value. Instead the value will be real assets represented as "tokens".

The asset can be anything. Stock, royalty rights, water rights, futures, commodities, etc.

The ledger would then act as an exchange/settlement layer that can match trades. Merchant denominates prices in shares of GOOG, customer pays with AAPL.

It seems like currency is largely helpful for providing liquidity for trades. It's hard to trade goats for camels if the other person doesn't want goats. The ledger I believe can help get around that.

It's utterly failed at that, because nobody actually cares about it as a payments system. People care about it as a speculative investment.

The more people care about it as a speculative investment, the worse it gets at being a payments system. We're seeing this today, as the costs of using bitcoin skyrocket, and the overwhelming majority of bitcoin transactions are sending it to and from fiat-to-bitcoin exchanges.

BTC's value now could come from it acting as a store of value for example. Or its value could come from the novelty aspect. Or that it facilitates online gambling (leveraged bets on crypto exchanges) in countries where such activity is heavily restricted. BTC's value in the future could come from it being a historical artefact. Lots of subjective reasons investors may have for holding it (just like they hold a piece of art) beyond its use as a currency.

That's not the argument being made. My paintings are scarce but they're worthless. Lots and lots of scarce things are worthless, and rightfully so.

"bring people some measure of joy."

Right, so there's some aesthetic value there. Why can't BTC be like the Ancient Egyptian artefact that's valued purely on aesthetic grounds? I could plausibly see it as a historical artefact in 200 years time, given its novelty and role in tech history. I have an old stamp collection and some BTC, and I get much more pleasure from the crypto due to its novelty, role in culture, etc.

haha, I've never had trouble buying and selling GLD instantly. Gold futures too! My broker charges a few pennies.

On the other hand a BTC transaction uses 600kWh of power, yields 100g of e-waste, takes hours to confirm and $20 in fees. Yay! What a time to be alive. I'm sure glad we went through all this consternation.

> That this has sustained for 12 years is amazing and the longer it stays, the longer it will further stay.

Madoff lasted 17! :)

The US still imports a lot of manufactured goods, but that's a consequence of it being competitive in many other service-fields such as software, entertainment, financial services, corporate management, and healthcare technology.

China may assemble the iPhones, but America is designing and coding them. To me that makes it seem like China is the much more co-dependent party in the relationship than the US.

[1]https://www.nam.org/state-manufacturing-data/2019-united-sta...

There's no way to absolutely sure that the keys are gone and inaccessible permanently.

Of course that Day 1 post doesn't reflect the HN discussion since then, and current comments don't either.

But more small-sample-size anecdata would be to look at recent comments:

https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu...

Of the 20 most recent comments, I'd say 12 are negative, 4 are positive and 4 are neutral. (Your comment showed up in my search and I counted it as neutral.)

If it 'goes down' it means, almost everything else is 'going down again'. Your BTCs are useless in that scenario.

BTC is a terrible currency and a bad store of value - and there is no 'mathematical arrangement' that can replace good governance.

It would be like using digital contracts for legal contracts etc. - that won't solve corruption and inanity.

What we need a are good, well managed currencies. If you don't like how they are managed, don't hold on to currency. Buy real estate, stocks, any other classical form of value and use the local currency merely as a medium of exchange and you'll be fine.

https://crypto-anonymous-2021.medium.com/the-bit-short-insid...

(disclaimer, I know nothing about bitcoin, there's likely 100 reasons why this makes no technical sense)

The bigger benefit for the time being is that it allows you to trade pairs that aren't even yet on exchanges (Coinbase is famously slow to add anything, and still doesn't even have multiple top 10 projects). There is also nothing stopping DEXs from partially lowering the fees in the future as the technology stabilizes.

Of course, I don't expect them to eat all of CEX's business but an increasing portion of it and it is a pretty significant disruption.

The modern financial system itself is in fact an alternative to gold

EDIT: And fraction was less than 1/10th of the combined entities. Again, where’s the upside? Are you saying this gets to tens of billions in revenue? Wells is at $80 billion and valued at $150 billion. Is Coinbase going to get to $80 billion in revenue? How?

Jeff Bezos owns 20% of AMZN, most of which he hasn't touched since it's founding. Does that mean that AMZN isn't really a $1.5 trillion company?

People reach for the handiest hammer, but it doesn't follow that the hammer is driving the hammering. Ethical concerns are the best hammer, of course, because then one's own motives are unimpeachable; but failing that, you'll see comments about the business being shitty for other reasons—"it used to be good but they've been declining for years and I can't even use it anymore" is one, and "how is this a viable business, look at those financials, doesn't anybody care about profit anymore god this world is insane" is another.

I don't believe Dropbox threads are generally friendly to Dropbox anymore, and I'm pretty sure Digital Ocean has been on the rack here too. Today's thread was a noticeable exception. Most S-1 threads are pretty cranky in general.

US definitely has a long way to go with crypto in general, on both the access and tax side of things. I hope things will improve, but honestly not sure they will any time soon.

And yeah, the XRP side of things was definitely to cover themselves, and not want to be in that potential mess. I think that is a reason for not having Tether too, it comes with historic baggage even if those issues aren't present anymore. USDC makes sense to limit their own risks, even though Tether is still more popular overall.

What sucks is how much influence they have on overall markets. When they back something and have financial interest in it, and add it to their exchange but not its competitors. I would love to see it more open to other ones faster, but not sure it will be.

What are you on about, look at what has happened since the 80s in the US and in Europe and the massive wealth transfer due to policy WTO and the off-shoring to Asia, specifically in China. All of that was possible due to the US moving from a manufacturing giant to a service sector economy only possible due to reckless Central Bank money policy, creation, and market speculation.

I'm lost for words with how absurd you people are about Bitcoin, but Central Banks are the largest ponzi of all, they steal from future generations to pay for the myopic and insane monetary policy of the present. We resisted and opposed all these endless wars and bailouts, but realized no amount of protesting will change their behaviour.

We sought to exit this, and created a system to opt-out, but you are free to stay and have your wealth evaporated as you please.

But consider that the 'smart money' is with us, and their balance sheets get bigger and bigger day by day. What bearing that has on your life and decision making is up to you, we are already so far beyond questioning and anything they say is irrelevant to us at this point, and we do not intend to listen. Janet Yellen is about as releevnt to us as CRW 'faketoshi' a minor inconvenience that simply refuses to go away and makes lots of noise, but will ultimately be silenced and would benefit by just opting in.

equities markets cant be compared to a commodity. so that invalidates your entire first paragraph, the longest one. as a corollary to that, don't derive your confidence from equities investors opining about commodities for the first time in their lives. you have equities investors that never traded tech and never traded commodities talking about bitcoin, you cant call that insight. bitcoin is looked at in market cap terms because it has a more transparent supply than any other commodity. this is completely new to the universe of assets and the market likes that. it removes a risk with gold, oil, etc.

paragraph two and three: you want high price for a longer period of time, but are turned off by the exact and only mechanism in which it gets there - large % and large $ amount price increases. fascinating.

more tech equities comparisons. mmmmk

I’d like to leave you with an alternative tool for valuing, and its just scarcity. if thats not good enough for you, then just stay out of the market. retail investors en masse never got married to commodities markets for the exact reason that they are not buy and hold outside of some metals. volatility is not controversial in the commodities markets, its termed as seasonality, as supply and demand ends up having a frequency in some markets. A lot of the equites market style comparisons to bitcoin is because it started with retail (non-institutional) who never traded anything else. But don't be like them. Bitcoin’s not a company so dont use company comparisons.

You could probably cherry-pick some dates between Q2 2018 and end of 2019 that would come pretty close to this criteria.

Bitcoin can be transferred electronically, and can move across borders without being hassled at customs.

Is there a difference between investing in gold (30% "real" value, 70% "speculated" value) and investing 30% in copper (100% "real" value) plus 70% in bitcoin (100% "speculated" value)?

Outside of ETH, BSC (Binance's smart chain, the exchange with 9x Coinbase's volume) already has lower fees but the chain is controlled by binance (its 'stock' is the token BNB valued at 40b currently, possibly a good investment) and has an influx of projects due to low fees and easy ETH-BSC migration. There are some other competitors with active smart chains but less projects and many are waiting on ADA's smart chain in early Q2 as well as on some other competitors that (might) solve that and other problems.

ADA (built by an ETH co-founder) specifically solves some of smart contract's current gripes by allowing you to build them in functional languages like Haskell, while being the most decentralized option which might be of interest here.

What will happen to your assets if coinbase's systems become inoperable or if customers try to withdraw more coins than coinbase has on hand? Ask Mtgox customers how they feel about where to park coins.

People are learning the paradigm of self-custody, which the blockchain supports.

You can stick with DTCC freezing markets, we arent.

I don't trust the exchanges in the cryptocurrency world, coinbase maybe excepted.

Personally, I deposit coins into an exchange, do my trade and withdraw it as soon as possible. Not just because I think there's a risk they might get hacked, etc, I also don't want them to hold my funds later on for reason x,y,z.

Still, the option to do so is very important and valuable.

Also, again I'm no expert but, I think the mere news of the BTC moving from that wallet would have much more of an impact on the BTC price than the BTC ending up on the market.

The crypto market is highly irrational and influenced more by memes than straight supply and demand. I'm confident that the crypto news sites are all owned by people holding crypto. If I had a ton of money and a lot more to gain, I too would invest in paying or setting up media outlets to try and direct the price upwards even further.

I mean I'm fairly sure that's market manipulation, but it's only a crime if it can be traced back to me AND if crypto is considered an investment product, beholden to market manipulation laws.

I mean if I put a haunted plant on sale on ebay and pay a bit of money for the media to report on it, and some schmuck comes by to buy it for $10K instead of its real value of $10, does that make me guilty of market manipulation? I mean the answer is yes, but is there a punishment for that?

I don't think it'd be possible to recoup the investment, but if you have a strong argument otherwise I'm sure some billionaire/nation-state investors would love to hear it.

How so? Jewelry's function is to look a certain way.

https://en.wikipedia.org/wiki/Abundance_of_elements_in_Earth...

Internet didn’t succeed because it allowed illegal stuff to be published. It succeeded because anyone could begin publishing, and if it was illegal then it was their responsibility.

With blockchain it’s similar - you can create financial instruments without gatekeepers. It is your responsibility to uphold the laws.

Such approach leads to far greater innovation. Just look at what UniSwap is doing - they are pioneering a system to exchange low volume tokens without an order book. This is something that stock exchanges tried to solve for many years and failed. Or flash loans - a concept that is virtually impossible to do on the traditional markets, and makes the whole financial system way more resilient in the end.

That's the same as claiming that the "market cap" of a cryptocurrency has some meaning. It really doesn't.

Both of those statements assume that somehow every ETH coin ever minted can be sold for the asking price right now. That's an obviously laughable assumption.

Do they? I'd rather own a couple of major exchanges in today's financial system for the same price.

  ICE   net income $2.1bn  market cap $63bn
  NDAQ  net income $0.5bn  market cap $23bn
  CME   net income $2.1bn  market cap $72bn
  CBOE  net income $0.4bn  market cap $11bn

So it's valuable because it's scarce and it's liquid because it's valuable? I imagine you can see how a skeptic might view this. I would be skeptical of gold coins too, but for the fact that a gold coin today would have been valuable in ancient Rome as well. So I don't really understand why gold is so valuable, but the fact that it's been very valuable (to varying degrees) for 5000 years leads me to think that that will hold for at least for the rest of my life.

I agree that Bitcoin has advantages as a store of value over gold. But it's value is only as high as people value it for, so the trillion dollar question is whether it's just a fad. For those of us who are skeptical, there are definitely things that could bring us to the other side, such as sustained value for a longer period of time.

I think this refers to the k factor, that puts the "soft limit" on decentralization. This I see as a barrier to entry: Ethereum 2.0 is 32ETH and that's it. Cardano has no monetary fee, but has eventual competition between pools, which is variable, likely ongoing cost. Barrier to entry is less defined, and could at some point grow beyond dollar value of 32 ETH (to become a competitive pool). Whereas Ethereum 2.0 will always stay a constant 32 ETH, no matter how many validators exist.

For those who don't know, the founder of IOHK (which created ADA) is one of the co-founders of ETH.

I'm confident in his ethics and his ability. I'm not so confident in the ethics of the ETH project anymore.

-edited above since I get rate limited every time I post more than two posts in a day, read the following as a response to the post calling me a liar below:

Ok, I edited to take out the reference to when he left since apparently I made a mistake on the dates -- I thought he was still in the ETH foundation when that happened.

However, he was one of the few voices calling for the ETH foundation not to hard fork to just roll back the DAO hack. The ETH foundation did what was expedient for them financially, and ignored the core tenet of cryptocurrency.

Fact remains, ETH was an immature cryptocurrency, run by immature people, who made immature mistakes. He was one of the few who called them out over it.

You can see what he has done over the years since with IOHK to bring maturity to the space. I think the results with ADA speak for themselves.

The whole reason we have a strong central bank is because we tried the alternative before and it worked terribly: https://en.wikipedia.org/wiki/Wildcat_banking

The dollar depreciates / appreciates due to various economic factors, not just because of actions by the Federal Reserve.

https://www.investopedia.com/articles/forex/051115/top-econo...

Controlling one means losing the control of the other and modern central banks control the interest rate, not the quantity of money.

So, the causality is like this: when the economy gets hot, more credits are asked by business and households, because of that, the interest rate go up. In order to keep the interest rate in their choose target, central banks will add more money to the system. The Fed doesn't decide the quantity of money, the economy does it.

Users of USD or EUR worried about inflation and getting into Bitcoin are really worrying about the wrong kind of tail risk. Users of other non-hard currencies have more of a point.

https://www.bleepingcomputer.com/news/government/federal-res...

The post you replied to said unstable or high inflation, not unusable. An unstable dollar will not instantly bring about the apocalypse, there are plenty of real life examples of unstable, high inflation currencies. The currencies took years to fully fail.

Not to mention, a few years of hyper-inflation don't even imply that the currency will fail.

Signed transactions can even be shared through other channels, to be broadcast at a later time for settlement, like a check. This is how the Lightning Network functions.

Keys can be held in many forms, including purely in software, digitally inside a hardware secure element, or converted to words and printed on paper or metal.

Bitcoin even has basic scripting that allows more complex setups, such as only allowing a ledger entry to be updated after a certain duration (timelocks) or requiring a quorum of signers (multisig), so simply having a corresponding private is not always sufficient to immediately spend the corresponding funds.

In the past “brain wallets” were popular, where the private key is generated from a memorized passphrase. These are a bad idea because it’s trivial to watch addresses corresponding to every entry a password dump, and automatically move these funds whether you’re the original owner or not. I mention this to illustrate how having the corresponding private key is necessary to control funds but it’s not sufficient to prevent someone else from controlling the same funds.

On top of all this, most “Bitcoin users” leave “their” Bitcoin on exchanges, so what they really own are IOUs rather than Bitcoin itself.

Bitcoin “ownership” can be pretty abstract.

It would be more accurate to say that you can own "mathematically guaranteed exclusive control over" bitcoins.

and you that can store that mathematical guarantee on any number of cheap, readily available physical devices.

You can also elect to destroy the possibility of outside knowledge of the secret, leaving the "physical memory chip" as the sole means of humanity interacting with those coins.

crypto: more friction, slower transactions, higher transaction costs. And wicked exchange volatility.

Plus no way to expand or contract the supply to prevent economic shocks.

I like my fiat and central banks, thank you very much.

That being said, political influence on markets (e.g. via fiscal policy) is indirect and can take years to manifest.

https://fivethirtyeight.com/features/no-bill-clinton-does-no...

https://fivethirtyeight.com/features/dont-let-trump-or-any-p...

https://www.theatlantic.com/business/archive/2014/07/why-the...

Monetary policy, on the other hand, is immediate. Interest rates and treasury yields cause immediate movement in the economy because capital can be made liquid. It also has the potential to get really bad really fast, as we've seen with hyperinflation in Venezuela and Zimbabwe.

And specifically speaking to the merits of assets that are free from Fed/Treasury policy; if you had held a little bit of gold throughout the 2000s as a safety net, it'd have been much easier to weather the storm of the financial crisis than if you hadn't. People flock to safe haven assets to seek refuge from their country's policies when required:

https://news.bitcoin.com/venezuela-bitcoin-use-hyperinflatio...

https://www.coindesk.com/nigeria-bitcoin-adoption

Gold (and other comparable deflationary assets) are considered a hedge against fiat. Whether Bitcoin can also be seen as a comparable asset is the central question, but looking at the last 12 years, the ship has mostly sailed there.

Given my bank is on the list of "systemically important banks", if it goes under/down there's probably more going on in the world such that I probably won't be worrying about my proverbial $100 too much:

* https://en.wikipedia.org/wiki/List_of_systemically_important...

(And I do have accounts at multiple banks in case of IT problems at one bank.)

> If all exchanges you have access to in your country decide to ban you (because your govt told them to) then you cannot spend your bitcoin.

Of all the things that I could worry about going wrong in my life, these doomsday scenarios are not even in the Top 1000. I'm more worried about stubbing my toe than some of these currency collapse scenarios that some Bitcoin fans come up with.

> Personally, I think the burden of proof goes the other way.

Well, it's not exactly a brand new experiment, we already know what happens when you have a deflationary store of value alongside fiat currency, and we see that in Gold today. The concept isn't strictly unheard of. I think what's debatable is if the last 70 or so years of gold alongside fiat currencies is sufficient enough information for us to conclude that having things like gold and gold-like assets won't be disastrous to a financial system.

> so far mainly useful for scams, ransomware, market manipulation, money laundering, and other kinds of light financial crime. (Plus speculation of course, but there were plenty of options for that before.)

This is true of paper cash, too. There’s a common saying that if cash were invented today, it would be illegal, since it’s hard for the government to track and they wouldn’t like it, which I find amusingly true. The preponderance of bad people using a tool doesn't immediately render the tool itself bad.

Bitcoin (and crypto) has been around for only 12 years now. Is it perfect? No absolutely not, there are a ton of kinks that need to be ironed out. Costs and speed need to be improved (probably through L2 protocols), we need to find ways to reduce energy consumption and use green energy as much as possible, we need to make sure that the money flowing into schemes like Tether is legitimate. I think the proponents all know that there is still lots of work to be done, and it feels like the detractors think that the adherents don't know that.

What's especially entertaining to me, personally, is that I have no horse in this race; I don't work with or for any crypto institutions and I hold a tiny amount of play BTC/ETH just for curiosity's sake. I am neither a proponent nor a detractor. But the sheer amount of misinformation and strawmen arguments leveled against BTC has has pushed me to seek out the strongest possible arguments in favor of BTC, so thanks for that.

Just wait and see which solution will come on top.

But regulated currencies can also turn out disastrously bad (see: Venezuela, Zimbabwe hyperinflation, Nigeria, Argentina). This hurts ordinary people too. There's an Argentinian in this very thread that's chimed in with their personal experience.

I won't pretend one approach is strictly superior to the other, nor am I suggesting that one ought to put 100% of their life savings into BTC or US T-bonds, but having options allows the ordinary person to hedge. That's the point. Optionality is good, and because BTC isn't legal tender (nor will it ever be), nobody is forced to use it anyway.

10 dollars is a steep confirmation price but if you have a life savings of, say, the equivalent of a few hundred or thousand USD that you hold in cash and your local currency is rapidly inflating making it worthless, btc is an amazing life raft that you could put your money into. If you are able to migrate and get a high paying job and still have family somewhere far away in the world that you want to help, $10 fee is not that crazy to send them monthly payments that they could then trade for cash or food.

Then there are obviously the side chain solutions, lightning network, or even just using exchanges to transfer btc to altcoins with faster settling times and lower fees if you really do want digital cash.

If the use case is only large gold like transactions, the BTC use case makes more sense. Tbd.. shake it out.

This is an inevitable result of deflationary currency.

Coinbase, as a marketplace, engages in the exchange of (potentially) bad tokens like USDT, as well as tokens like BTC that are provably finite. All of this is orthogonal to the fact that there is nothing hypocritical or internally inconsistent about holding and using Bitcoin or Ethereum and using Coinbase.

You wouldn't own the bitcoin, just as now you don't own the real fiat. There would just be a number on your bank account that says how many bitcoin you own, but it's multiplied the same way as they do now.

It all comes down to the % of reserve they need to hold.

There is in fact an upper limit set by the fractional reserve. I see US has abolished that limit right now (March 2020), but when they would set it to 100%, there would be no money multiplying at all.

In your own source, the banks ability to increase money supply through the multiplier effect is capped by the capital adequacy ratios, which are defined by the Fed. It is also an inevitability of any currency that isn't backed by an asset. To be clear, I don't have problems with the concept of fiat currencies, but we have to be honest about what it actually is and how it works, and how Bitcoin is different.

If Fed/ACH going down for a few hours bothers you a lot but electricity/mobile network reliability doesn't faze you, you must be living in a truly unique place.

Citation desperately needed

> No system where every actor needs to keep a permanent record of every transaction of every other actor forever can scale to the entire planet

If the costs associated with keeping these records are negligible and all the work is done for you electronically by an app on your phone, then yes. It absolutely can scale.

> Please keep the Bitcoin-the-protocol and Bitcoin-the-currency separate.

I am. Bitcoin is the protocol. BTC is the currency.

We are psychologically caught up in the idea that 'gold' or 'property' has some 'intrinsic value'. Like if there were a nuclear war, it would all be cool, our 'Billions' would be protected!

But no, we can only hold on to stuff that others might find valuable some day.

In other words: currency, even 'stores of value' is a social contract within the system you operate.

If the system fails, well, both currency and stores of value are probably going to not be worth a lot.

Yes - Gold is nice because it's a default currency you can use anywhere. Property tends to hold value as long as there are people there who want to use it - and the legal system that recognizes ownership exist.

But otherwise, there is no way around it: you cannot magically store value in your pocket independent of a bunch of other complex systems being in place.

BTC is reminiscent of the 'Drain the Swamp' ideas, that somehow all the politicos and bureaucracy are useless and irrelevant. Well yes, shenanigans abound and does inefficiency, but that doesn't meant it's worse than nothing (!) our systems are made by smart people. The only way forward is 'doing something better' and BTC is probably not that.

Absolutely not. If you take the top 10 crypto currencies sorted by marketcap, half of them are actually stock-like tokens. It is not a misinterpretation, or a deviation from the intended purpose at all. These tokens are intended to replace shares of the company, and they have rather similar capabilities: by owning them you have voting rights, different token (share) classes exist, etc.

Honestly, the term "crypto currency" is very misleading, most of the tokens issued nowadays are share-like, and buying them is just a form of venture funding for these startups.

What you would have at that point isn't Bitcoin, it would be probably be called "Bitcoin infinite" or something, similar to "Bitcoin cash".

Oh just that huh?

The market wouldn't value that new fork on par with finite BTC, so those miners would be hurting themselves, and burning energy for a worth-less coin.

This action is trivial to consider, so what makes you think it has bearing on BTC value? When these miners leave old network, hash power & difficulty go down so other miners who prefer finite protocol can come in to mine. What's the actual threat then?

The real elephant in the room is that new crypto currencies are being printed left and right. We may have a finite number of Bitcoin (in a couple decades) but one look at the list of crypto currencies will show that the number of crypto coins in general continues to explode at a phenomenal rate.

Biggest barrier to more gold is technology. There's a ton of it in space.

If it forked in a way that completely defeated the limited supply and led to rapid inflation then it would massively tank in value and miners would lose a lot of money. That’s a pretty good incentive for them not to destroy it.

As far as bitcoin existential threats go, there are many of them - the energy cost, a 51% attack, so much concentration of mining in China, etc. Miners mutually colluding to destroy their own investments is not at the top of my list of worries.

Please do a 2 minute read of the BCH wikipedia page and correct your comment.

Why?

Why is this a bad thing? America's founders believed that the people could mint their own coins.

I don’t mean this flippantly.

One of the cryptocurrency is going to win out for day-to-day usage; the question is which.

As Andreas likes to say: “email used to be a multi-step series of memorized commands from a green terminal in a University.

Now my Mom can do it with a touch of her finger.”

I believe we’ll get that in the near-ish future.

For the common transactions people make, crypto is both slow and expensive. I can Zelle someone instantly, for free. In the EU, Australia, etc., bank-to-bank transfers are similarly instant. I don't know that Bitcoin etc. ever get to totally free in this fashion, and it's probably 99.9% of most people's money transfer usage.

For the uncommon transactions - like the $50k international transfer you mention - slow tends to be OK, and it's likely gonna have some expense either way.

Short version: In contrived scenarios, Bitcoin may come out on top, but that's not likely to convince many people.

If rubies didn't exist and somebody were setting out to invent them at the cost of major ecological harm plus enormous waste and collateral damage to financial novices then that would be a decent comparison. Except that rubies have intrinsic value, whereas Bitcoin doesn't, making it a yet worse analogy.

> different but [...] still being "the same"

I am going to take this as an exercise in aggressive point-missing on your part. If you still don't get the point, feel free to ask.

> Bitcoin is absolutely valueless

I didn't say Bitcoin was valueless. Again, you seem to be aggressively missing the point.

> BNY Mellon and BlackRock

That's not proof of value. Traders will trade anything with enough volatility, because that's how they make money. Making money is frequently distinct from creating value. I'm speaking specifically of value, which again, Bitcoin has not demonstrated net value creation, especially when compared with other things that started at the same time, and especially when there's a full accounting of costs.

Actually bank deposits at commercial banks are not legal tender. Only banknotes, coins and deposits at the central bank are. In most (all?) countries, individuals are not able to open accounts with the central bank. Interestingly this is not a rule set in stone. Some central banks like the Swedish Riksbank [1] are investigating the possibility to issue virtual currency to individuals which would be a legal tender and an alternative to bank deposits.

[1] https://www.riksbank.se/en-gb/payments--cash/e-krona/

* accept 100 bitcoins for deposit, giving their previous owners "100 claims against exchange X" in return

* sell those 100 bitcoins

* the new owners of those 100 bitcoins can roll down to exchange X and deposit them and accept 100 claims against exchange X in return

* and the exchange can sell those 100 bitcoins once again

Now we've got 100 bitcoins out in the world and 200 claims against exchange X, and each of these 300 items functions identically. They're exposed to all risk of gain or loss on the market, they can be traded, sold, used to purchase stuff... with the only limitation being that not every claim against exchange X can be immediately redeemed. But as long as not every person tries to redeem their claim at the same time, there are no problems.

Exchange X has permanently [until they exit the market] increased the usable supply of bitcoins. Nothing prevents an exchange from having more than 21 million bitcoins on deposit. With large enough exchanges, the banked, usable balance of bitcoins could be 100 million coins. 100 trillion. There is no limit.

A government absolutely can declare that the correct blockchain is actually this other blockchain, or the only legal algorithm is now a version of their own invention (like the split between Bitcoin and Bitcoin Cash, but enforced by law). If the gov wants inflation, they can replace the algorithm with one that allows inflation, or achieve a similar effect by publishing an official root block every year with a portion of all holdings transferred to the government.

But they probably wouldn't do that, when it's so much easier to simply seize cryptocurrency ("give us your private keys or spend thirty years in prison") or heavily tax it.

None of this has been done because crypto is still a novelty, but if it ever becomes a serious threat to government policy, governments will find ways to deal with it.

And centralizing Bitcoin in exchanges like Coinbase makes this far easier; the government only needs to enforce its policy on Coinbase, and Coinbase in turn will enforce it on customers.

https://news.ycombinator.com/newsguidelines.html

> Large-scale hydro is major ecological harm. And even for something less damaging, that's still massive energy use that could be used for something else. Bitcoin is displacing other activity.

Sure, but you or I don't get to decide how people spend their time, or where they focus their activities. And you also didn't address the fact that this needs to be compared, apples-to-apples, with the mining of conceptually similar assets like diamonds, rubies, gold, etc.

> especially given your tendency to treat your personal feelings as objective fact.

Actually I'm arguing the exact opposite; that value is purely subjective. Just like you, I myself don't derive much value in Bitcoin (something we agree on!). The point I'm trying to make is that just because you and I don't find value in it, doesn't mean that the value doesn't exist. My entire argument here is that my personal feelings don't matter, and importantly, neither do yours.

That argument of subjectivity is a lot more uncomfortable for people because it means that you have to just sort of accept that some people see value in something that you don't. That's the idea I'm trying to convey to you. The only objective fact is that everything is subjective.

The Diamond-Water paradox isn't some "feeling", it's a real economic theory that attempts to explain the exact question you've been grappling with. You've been asking all the right questions, they're just questions that have already been asked before when dealing with conceptually similar assets (obviously not "the exact same").

> I don't get the impression that you understand value at all

Oh you've more than made it clear that you have this impression. You just haven't done the best job explaining to me why that is.

> If you actually aim to learn, you could start with the Lean look at value; they write some pretty accessible stuff. But I'm done here.

I'm more than happy to learn! But you'd have been better off in this conversation if you spent less of your time attacking me or expressing indignation at the mere fact that I'm making my points and more of your time making the specific case for why the Subjective Theory of Value doesn't hold or what the "Lean look at value" is and why it's compelling (I'd even believe you if you fully articulated it).

Not going to continue this discussion any further because you seem less interested in having a polite conversation, and this is starting to get destructive.

The claim I responded to says that in addition to this, you also need the majority of the "nodes", which are just computers that do no work and just forward transactions. This is incorrect, you do not need their help. It is easier if you have it, but you do not need it.

I have no doubt that a persistent 51% attack by a cartel of miners would make Bitcoin liquidity an indefinite hard zero for selected "owners" of BTC.