You can (and many do), but that brings actual banks and tax authorities and regulators into the mix. What stablecoins like Tether do best is keep a given cryptocurrency’s market economy a closed one.
Your comparison to an MLM scam or Ponzi scheme is apt, because they’re effectively closed economies, too: USDs go in, but they don’t go out.* They’re no-kill roach motels where the BTCs and Tethers (essentially proxies for the USD) and USDs just swirl around and for the most part aren’t used to buy or invest in actual goods and services unrelated to cryptocurrencies.
[* yes, some people cash out into fiat currencies, but it’s usually a one-time “big score”]
Like any of these scams - getting in and out early is the only winning play if you’re not at the top levels. If you’re comfortable with ripping others off. Often your friends and family.
Since I’m not going to be involved in tax evasion, money laundering or buying drugs from strangers- and since I didn’t get in early- my only option here is to be the sucker holding the bag when it collapses. There’s no metric if you consider this an investment to determine its value to make informed judgements on it’s value and when to risk your money here. As a currency- actual money meets all my needs.
It’s really sad reading through all these comments and seeing people who say “could never afford” to buy bitcoin. You can. You don’t have to buy the entire coin, you can spend 5,10,20 dollars…whatever amount you want. Also, if you think the current price of $23.7k is the top, you’re fooling yourself. Bitcoin will be well north of $100k by this time next year. Buy now or cry later.
Who’s saying that? I just did a quick search of the topic for the words “afford” or “expensive” and came up blank. I assume most of the commenters understand the concept of fractional ownership.
Stuff like this makes me chuckle. Hell, you may even be correct, for a given value thereof.
My roommate in 1990 was adamant that I should drop out of college and put everything into Microsoft stock. He was right, looking back, but there was no way to know that at the time. In the late 90s I should have bought Apple, but didn’t. When Google went public I thought about buying but didn’t, similarly Facebook and Tesla.
Sounds like a series of failures unless you consider that there were many others that went under or failed to thrive around the same time. Nortel, Alta Vista, Yahoo, etc etc. I got equally exuberant advice on them.
BTC is having a day, driven by people with a weak understanding of finance. Good luck to them when they try to cash out.
This is the source of my negativity around bitcoin. Sure, I eat up the negative comments partly as sour grapes but at the end of the day it’s just really boring gambling in a casino with a half-assed theme (near-future cyberpunk?).
I work every day for the money I live on because I like my work, it contributes to society and I’m reasonably sure I will be paid for my time an amount I can live predictably on. Fine, people who get lucky, or have a “smell” for investments can laugh, and look down their nose at me engaging in the sucker’s game. Maybe they’re right that true wealth and freedom belongs to the “bold” (read: privileged) but I can’t fathom the reason for encouraging or celebrating a world organized around people being rewarded simply for (the ability and opportunity to be) taking risks.
If there’s an argument for allowing markets large enough to impact economies, those markets should be doing something. Personally, If I’m going to “invest” in anything, it would be a kickstarter, where I’d get a cool thing and help bring something into existence that wouldn’t have been able to be born without collective action. From a cool-shark-guy investment standpoint I realize that’s basically akin to charity (another sucker’s game, since I don’t make enough money for significant write-offs…)
Vote in the poll above if you haven’t! So far 86% of readers have never used Bitcoin and I can’t blame them. It is a colossal PITA to buy things with and use in general.
I think Chia, which uses “proof of unused hard drive capacity” is really interesting. Bram Cohen, inventor of BitTorrent, is heading it up. I wrote an article about it a couple of years ago for California Sunday Magazine called “Bitcoin’s Inconvenient Truth.”
I used Purse.io back when bitcoin’s transaction fees were a few cents (they are about $4 now!). Now if I buy something with crypto, I used Bitcoin Cash, which has a current transaction fee of $0.0068.
The street has found its use for bitcoin, and it’s not for buying everyday goods and services.
Wow that’s really interesting, to track the transaction fees over time… wasn’t that supposed to be one of the selling points of Bitcoin? No more high per-transaction fees? I guess at least it isn’t a percentage of the total…
Most things you can buy with Bitcoin aren’t legal (this includes ransomware payoffs and so on).
If lots of people actually tried to use Bitcoin to buy stuff as a matter of course, it would collapse onto itself because by design it can only sustain a maximum of around seven transactions per second (MasterCard and VISA, which handle tens of thousands of transactions per second, are saying “hold my beer”). Even now transactions can take ages to clear on the blockchain unless you bribe miners into including yours by posting a juicy bounty (which of course is only worthwhile if the transaction itself is big – it would be stupid to pay for a cup of coffee with BTC when the transaction fee is several times the cost of the coffee, but it would also be stupid to have to wait for hours until the payment for the cup of coffee goes through). There have been various proposals for methods to get around the low transactions-per-second number but so far none of those have got traction. They usually work by trying to move transactions off the Bitcoin blockchain, which negates one of the touted advantages of Bitcoin, namely that people can verify the integrity of the Bitcoin flow history for themselves.
Bitcoin is so volatile that it is a hassle for people who sell stuff to post prices. Even if vendors (certainly vendors of legal things) do accept Bitcoin, they usually convert it to fiat currency immediately upon receipt, because you can’t generally use Bitcoin to buy new stock, pay the wages of your staff or the rent for your premises, or remit your taxes, and if you receive it today there is no telling what it will be “worth” tomorrow. For most businesses this isn’t worth the grief and so they don’t bother with Bitcoin in the first place.
I get that the valuation of Bitcoin in particular makes for great scam-breeding ground, and that seems to be where most are finding issue, understandably. But crypto currencies in general do have some very intriguing possibilities, that have nothing to do with 1 BTC = $20 000 USD . And in fact, that kind of valuation is counterproductive to potentially achieving real benefits (though the path to those benefits is fraught, as this paper lays out). As for the criminal activity argument, well, that can mean very different things depending where you live.
Anyways, this has been a very interesting thread, and I’m merely a curious bystander (though I do have a good friend who’s completely immersed in the world of crypto currencies and keeps me updated, to the extent that my attention span can withstand). I am still surprised by how constantly negative the discussion around Bitcoin is on here, when it (and moreso crypto currencies in general) do present some intriguing possibilities, even if only paving the way for something different, and better. But anything that attempts to make an end run around our despotic and despicable banking system is interesting at least (even if those days are probably numbered now that “institutional investors” are moving in). Cheers
Well, you know how it is. People who understand real-world economics and finance tend to be a bit more skeptical about these things. It also explains why Bitcoin is so popular amongst Libertarians, who in my experience don’t understand either.
