I agree with MMMs eloquent outlining of the major concerns with investing in cryptocurrencies. In the US we call it the full faith and credit of the United States. ![]() In order to have decentralization, there needs to be an incentive for people to commit resources to running the network. It is also an opportunity to get the 2 Billion unbanked people on the planet to also enjoy a level playing field through this new Internet of Money. Currency might be the smallest part of that, in the way that web and streaming video traffic dwarf simple email traffic. This is no different from rich wall street people and government controlling fiat currency. Do not let your own brain trick you for easy solutions! That is why our civilization used that rather than perishables or iron. Vijay, I agree with MMM that cryptocurrency in general is kind of dubious, and that Bitcoin is a particularly stupid implementation of it. And yet this is exactly whats happening with Bitcoin. Im not sure why the author is so angry at people who speculate. Educate yourself on Lightning Network or layer 2 protocols of Bitcoin. ), but to include gold bullion is not quite fair. Think that would fly at the grocery store? I like the way he analyzes investments. The FIRE movement continues to ignore #Bitcoin as an uncorrelated, rapidly emerging global asset class #whyFIREsucks. We dont buy average cars or average homes we buy older cars, and smaller homes to cut costs and live a modest life. Missing the forest for the trees kind of thing. Nope I am not a skeptic, and also since I was there then (with pre-internet BBS). Youre 100% right that fiat currency is only good when people trust itand that trust could be ZERO. In short, historically gold is the truest measure of value, the safest store of wealth, and best insurance against fiat money and other manias (see Weimar Republic circa 1934). Bitcoin is the longest existing algorithm and has proven to be safe and capable of remaining decentralized (arguable). If you ever want to see what a real bubble looks like, please look at a long term chart of stocksor dollars for that matterpriced in gold. For me, the answer is wealth rule #1 from MMM: You Dont Try to Gamble Your Way to Wealth. You can even have a social media/blogging site based on a blockchain, like steem/steemit. ![]() Will it get me my money faster? Bitcoins can be traced, your fingernails cant. What if anything gives a compelling reason that bitcoin or any one of these other currencies will end up in the group? The act of speculating on an asset is what drives it to its proper price they are critical players in the process of price discovery. People who have been trading 100s to buy illegal goods must be making out. We? This might be normal for an era such as this, where the growth is coming from real tech companies instead of widget makers. So, Bitcoin is a protocol invented to solve a money problem that simply does not exist in the rich countries, which is where most of the money is. Plus, it costs something like $20 per transaction. Understanding the motivation is a big part of understanding Bitcoin. Places like Singapore, Estonia, Switzerland appear to already working on converting their systems to digital cash. MentalArson Volunteerism could get you only so far, but the data could only ever be as safe as the amount of resources it takes to break the system. Is it possible youre confusing the message of this article? Yes, that is your ground reality today. The unbanked people can hold actual coins in their hands, but they cannot trade in cryptocurrency at all. Just the same with crypto-currencies today. People are likely to disagree on whether this is a good thing depending on their worldview. The reason Bitcoin has been driven so high is because its a limited supply. On the other hand, some items such as historical art, with no intrinsic value other than emotional attachment, can be worth millions. Bitcoin is used for some pretty awful things, the accountant at my dads prior employer stole $500,000+ and likely hid it from the authorities.
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