I understand the appeal and benefits of decentralized services, and how they could apply to currency, but I think there's something wrong with the idea that a successful currency should increase in value by orders of magnitude (or even at all). Like, E-mail is a very successful decentralized service, and people make money in relation to e-mail protocol specifications by providing value on top of it. Nobody got rich just for getting their gmail account early. I know there is a lot of experimentation being done in stablecoins, but it seems like speculative quests for the next 1000x return drive development instead of just trying to solve the problem of safely, quickly, and reliably digitally storing and exchanging value.
I do think it’s counterproductive that it was even possible for people to use Bitcoin as an asset. I doubt that Satoshi foresaw Bitcoin billionaires.
Currencies have historically worked that they’re stable (ish). And to become rich you have to acquire more units. Not hope your units grow in value. If you expect appreciation then your currency is deflationary which makes it unsuitable for a currency.
Obviously they could be wrong, but this prediction feels very reasonable to me.
I am extremely skeptical of cryptocurrencies in general, so you may take all of my claims with a grain of salt, but coinmarketcap.com tracks something like 6800 different cryptocurrencies. I very much doubt all but a tiny, tiny fraction of them have any use case at all.
After more than ten years, I still don't see a use case for Bitcoin (perhaps El Salvador will surprise me, but I doubt it!). There is nothing I'm aware of that I need to do financially which I can do with Bitcoin (or the like) which I'm not better able to do with the regular banking system. (I don't have much need for contracts in my life, smart or otherwise, but I would vastly prefer to deal with a real lawyer and the actual legal system, expense included, than rely on a smart contract.)
It could be that that amazing use for cryptocurrencies is right around the corner, but after a decade I don't expect to ever see one. Certainly it's not NFTs!
The blanket proposition that cryptocurrencies in general are going to fail is very different from your proposition, that most cryptocurrencies are going to fail. Look at social media: not too long ago, everybody and their cat was attempting to create the next big social media platform, and people were warning that it was all just a fad. And they were right, but people didn't stop using social media, quite the opposite. Social media is now more used and more important than ever, it's just that everthing clustered around a few winners.
That would be my prediction for cryptos: most of them aren't special enough to be useful, a lot are just pyramids schemes where the creators premined a big chunk and hope it will be worth something once they find users, but there's certainly some that are here to stay. I don't see the original Bitcoin disappearing, Ethereum is having a bit of a rough patch right now but has the potential to become a proper computing platform and I think privacy features like those Monero is offering are always going to be in demand. But we shall see.
> There is nothing I'm aware of that I need to do financially which I can do with Bitcoin (or the like) which I'm not better able to do with the regular banking system.
I would suggest that your life experience may not be the best yardstick for every other human.
I will provide an example of a recent situation in which I would have loved to be able to use e.g. Bitcoin. I (US based] did some consulting work for a company in France and they owed me something like $6k. Arranging an incoming international bank wire was a huge pain (if you don’t do this regularly, you’ll have to navigate multiple layers at your bank to find someone who can provide the actual wire details to provide to the counterparty), it took many days to finalize, AND I was charged $25 by my bank for the privilege.
In contrast, I should have been able to provide the French company a BTC address, have had them transmit for pennies or a few dollars at most, and have payment secured and confirmed within the hour.
NFTs are interesting because they are a start of the conversation on the path of digital ownership and scarcity. As it stands now, this space is not even close to its final form and eventually the idea of digital ownership is not so far fetched.
As an example - say a famous artist decides to create 1 single sketch. I only create 1 item and sell it to you who now in turn owns that piece to do as you please whether it’s lease it out for commercial purposes, stash it away on a HD, launder money, etc etc. Sure it’s just pixels on a screen but the ownership of rights is what you are paying the artist for. (Now imagine the same scenario 10-20 years down the line when super VR is a thing and most of us spend more time in our digital lives than the real world). As the purchaser, you can now track the usage of your asset you’ve purchased through a blockchain.
So it makes sense, but the current state of small iterations of the same piece of artwork are akin to ikea pieces in real value and are completely just advantage of the current hype. There will be a correction at some point as things mature.
you dont live in a failing economy or one where the govt intervention prevents the free flow of money.
1)chinese were able to smuggle money out of china
2)venezuelans are using it in lieu of their failed currency
3) criminals are using it to launder money and buy/sell illegal products
4) people are using it to send money across national borders without paying fees/tariffs (e.g. to mexico)
I remember not that long ago when the money supply was about 6T. Now with 30T in debt that automatically becomes the defacto money supply. Crypto can act as a stable store of value because all fiat is inflationary, though it is incredibly volatile now.
The use case for Bitcoin is a savings vehicle. The global financial system has reached a tipping point where it is incapable of providing a store of value for people who have accumulated capital without crashing the system and causing mass devastation. The fact that so many people still do not understand this tells me we have tremendous upside remaining.
Then ignore them? The beauty of voluntary systems is that they can thrive or fail and the only people impacted are those that choose to use them.
The SEC picks and chooses which rules to enforce and which parties to police, monetary policy is decided by authorities with no input from or regard for 99.9% of the population.
It's not surprising that people would opt-in to building alternatives with transparent and programmatic rules. It's also not surprising that these alternative systems will be fiercely fought after being ignored and laughed at, and it won't be surprising when they win.
> “I don’t think there’s long-term viability for five or six thousand private forms of money,” Mr. Gensler said in a virtual event hosted by the Washington Post.
I'd say they are bad because they just don't work right now. Scaling is a huge issue. Yeah yeah there are 100 theoretical ways to scale to 100000 tx/s with low fees, but until I see it, I will maintain that crypto is useless.
heyitsguay|4 years ago
thehappypm|4 years ago
Currencies have historically worked that they’re stable (ish). And to become rich you have to acquire more units. Not hope your units grow in value. If you expect appreciation then your currency is deflationary which makes it unsuitable for a currency.
huitzitziltzin|4 years ago
I am extremely skeptical of cryptocurrencies in general, so you may take all of my claims with a grain of salt, but coinmarketcap.com tracks something like 6800 different cryptocurrencies. I very much doubt all but a tiny, tiny fraction of them have any use case at all.
After more than ten years, I still don't see a use case for Bitcoin (perhaps El Salvador will surprise me, but I doubt it!). There is nothing I'm aware of that I need to do financially which I can do with Bitcoin (or the like) which I'm not better able to do with the regular banking system. (I don't have much need for contracts in my life, smart or otherwise, but I would vastly prefer to deal with a real lawyer and the actual legal system, expense included, than rely on a smart contract.)
It could be that that amazing use for cryptocurrencies is right around the corner, but after a decade I don't expect to ever see one. Certainly it's not NFTs!
franz_haller|4 years ago
That would be my prediction for cryptos: most of them aren't special enough to be useful, a lot are just pyramids schemes where the creators premined a big chunk and hope it will be worth something once they find users, but there's certainly some that are here to stay. I don't see the original Bitcoin disappearing, Ethereum is having a bit of a rough patch right now but has the potential to become a proper computing platform and I think privacy features like those Monero is offering are always going to be in demand. But we shall see.
chromatin|4 years ago
I would suggest that your life experience may not be the best yardstick for every other human.
I will provide an example of a recent situation in which I would have loved to be able to use e.g. Bitcoin. I (US based] did some consulting work for a company in France and they owed me something like $6k. Arranging an incoming international bank wire was a huge pain (if you don’t do this regularly, you’ll have to navigate multiple layers at your bank to find someone who can provide the actual wire details to provide to the counterparty), it took many days to finalize, AND I was charged $25 by my bank for the privilege.
In contrast, I should have been able to provide the French company a BTC address, have had them transmit for pennies or a few dollars at most, and have payment secured and confirmed within the hour.
soultrees|4 years ago
As an example - say a famous artist decides to create 1 single sketch. I only create 1 item and sell it to you who now in turn owns that piece to do as you please whether it’s lease it out for commercial purposes, stash it away on a HD, launder money, etc etc. Sure it’s just pixels on a screen but the ownership of rights is what you are paying the artist for. (Now imagine the same scenario 10-20 years down the line when super VR is a thing and most of us spend more time in our digital lives than the real world). As the purchaser, you can now track the usage of your asset you’ve purchased through a blockchain.
So it makes sense, but the current state of small iterations of the same piece of artwork are akin to ikea pieces in real value and are completely just advantage of the current hype. There will be a correction at some point as things mature.
achenatx|4 years ago
1)chinese were able to smuggle money out of china
2)venezuelans are using it in lieu of their failed currency
3) criminals are using it to launder money and buy/sell illegal products
4) people are using it to send money across national borders without paying fees/tariffs (e.g. to mexico)
I remember not that long ago when the money supply was about 6T. Now with 30T in debt that automatically becomes the defacto money supply. Crypto can act as a stable store of value because all fiat is inflationary, though it is incredibly volatile now.
beginTheJourney|4 years ago
atatatat|4 years ago
Well, right.
That's why all of the trading volume.
Bunch of no-nothings trying to figure out technological value via herd mentality!
bconnorwhite|4 years ago
Fortunately the government stepped in with its own currency to refuse to redeem for gold
zewp|4 years ago
The SEC picks and chooses which rules to enforce and which parties to police, monetary policy is decided by authorities with no input from or regard for 99.9% of the population.
It's not surprising that people would opt-in to building alternatives with transparent and programmatic rules. It's also not surprising that these alternative systems will be fiercely fought after being ignored and laughed at, and it won't be surprising when they win.
anon9001|4 years ago
That's going to age like milk.
verdverm|4 years ago
How many consumers will be willing to do currency conversions on a per transaction basis?
mekster|4 years ago
He said he doesn't see viability for 5000 cryptocurrencies and not cryptocurrency in general.
Of course no one thinks every dust coins have a future.
megameter|4 years ago
rvz|4 years ago
MengerSponge|4 years ago
imagetic|4 years ago
axiosgunnar|4 years ago
Havoc|4 years ago
lifeplusplus|4 years ago
sleepybrett|4 years ago
tryptophan|4 years ago
I'd say they are bad because they just don't work right now. Scaling is a huge issue. Yeah yeah there are 100 theoretical ways to scale to 100000 tx/s with low fees, but until I see it, I will maintain that crypto is useless.
ruchin_k|4 years ago
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