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Bitcoin - Here Today, Gone Yesterday?


DonRocks

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I think just about everyone has been captivated by the rise-and-fall of Bitcoin which, for a short while, appeared to be achieving the impossible, defying common wisdom that it was resting atop a bubble made of very fragile material.

And just when you think that the world has learned its lesson ...

"The Race To Replace Bitcoin" by Michael Craig on observer.com

Bitcoin 2.0?! Never, ever overestimate human capacity for believing in a pill that cures everything.

From day one, I thought Bitcoin was a scam, maybe even a type of Ponzi scheme - I would love to hear from people who believe in the potential of digital and/or non-governmental currency because I still don't understand it very well, and I remain both ignorant and open-minded.

My guess, if I were forced to make one, is that Bitcoin will fail, but will still be mentioned in history books hundreds of years from now as the start of something new. As to what that "something" is, I have no idea. Does anyone?

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From day one, I thought Bitcoin was a scam, maybe even a type of Ponzi scheme - I would love to hear from people who believe in the potential of digital and/or non-governmental currency because I still don't understand it very well, and I remain both ignorant and open-minded.

My guess, if I were forced to make one, is that Bitcoin will fail, but will still be mentioned in history books hundreds of years from now as the start of something new. As to what that "something" is, I have no idea. Does anyone?

"Bitcoin: Is the Crypto-Currency Doomed?" by Chris Baraniuk on bbc.com

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My personal view, aside from whether bitcoin is or isn't a viable "currency," is that it is a passing idea, something appealing to those who don't like rules, such as those society has wisely created to maintain stability in everyone's wealth and income, otherwise known as central banks and financial market rules.

But there is a potentially very positive aspect of bitcoin, namely bringing light to the ledger that underpins it, which is a blockchain.  Blockchains have a great deal of potential, which is becoming better understood.

In short, a blockchain is a store of information that is open to all but yet pretty well insulated from being tampered with or changed.

It's more complex than I'm comfortable trying to explain in any detail.  Here is an Economist article on the subject that points out its potential.  The Wikipedia article is here.

I think we will be soon be hearing a lot more about blockchains (also called altchains for applications other than bitcoin).

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I’m ignorant on bitcoin and generally skeptical of things of this nature.

Nevertheless I read something along these lines:  An individual purchased 1500 bit coin in early 2011 at $2.87/coin. (that is a plausible amount for that year.)  I think it is in the range of $7000 right now.  He is going to give away 5 based on some action.  (did it not peak at around $18,000)

Its tmes like this I wish I weren’t so coldly analytical or at least had a lapse from analysis and skepticism back in 2011. ^_^

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11 hours ago, DaveO said:

I’m ignorant on bitcoin and generally skeptical of things of this nature.

Nevertheless I read something along these lines:  An individual purchased 1500 bit coin in early 2011 at $2.87/coin. (that is a plausible amount for that year.)  I think it is in the range of $7000 right now.  He is going to give away 5 based on some action.  (did it not peak at around $18,000)

Its tmes like this I wish I weren’t so coldly analytical or at least had a lapse from analysis and skepticism back in 2011. ^_^

Not a bad deal. I am a bitcoin skeptic, but still took a flyer on two bitcoin in 2014, figuring that I'd wasted similar money on dumber, or at least equally as dumb, things. Sadly, not all my "flyers" turned out so well!

Blockchain is an incredibly interesting concept with a ton of practical uses. Cryptocurrency may the be least practical, but certainly one of the most interesting applications.

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1 hour ago, Keithstg said:

Not a bad deal. I am a bitcoin skeptic, but still took a flyer on two bitcoin in 2014, figuring that I'd wasted similar money on dumber, or at least equally as dumb, things. Sadly, not all my "flyers" turned out so well!

Blockchain is an incredibly interesting concept with a ton of practical uses. Cryptocurrency may the be least practical, but certainly one of the most interesting applications.

"Not a bad deal".  Ha.  If the story is true its a GREAT DEAL.  I saw the details in a tweet.  Supposedly the "owner" of the coins will give away five of them to five different folks if they retweet the story.  I didn't.  ---Whatever.

Is it true or not?  I don't know.  Its plausible.  I researched it and bitcoin was selling from a lower # to $31 during 2011.  

As with @Keithstg I've taken flyers on stuff I deem ridiculous.  Sometimes.  Invariably it never worked out.  I am so "trained" to avoid things that seem completely speculative and whose basis of value I don't understand....and I've never bothered to research anything on bitcoin.  

But man....if its true that is a GREAT DEAL.  Makes me laugh (at myself).  99.9% of the time I pass on stuff like this.  In other cases I've invested in things I researched up and down and sideways and additionally have a deeper fundamental understanding of their basics---and damned if I didn't lose on some of them.

In the spirit of optimism I hope it is true.  

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Bitcoin is something like the "dot-com" suffix for internet names - it has no inherent value, there's no (longer any) barrier to entry, and it's only "worth" something because people have decided it is. Unlike fiat money, e.g., the U.S. Dollar - where users are essentially "betting" on the security and longevity of the U.S. Government - Bitcoin (and dot-com) is pretty much propped up by faith alone.

Like Bitcoin (and Robert Parker 😜), dot-com got to market early and often, and that, in-and-of itself, can create long-term value. If Bitcoin can hold on, and somehow manage to gut it out for years or decades, who knows?

Hey, I paid a princely sum for the domain name dcdining.com, so it isn't impossible that there's something to this, at least in theory.

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On 3/27/2018 at 6:50 PM, Finatic said:

I do not know what bitcoin is, but before you invest, I strongly suggest you research the Dutch tulip craze.

On 3/27/2018 at 6:51 PM, funkyfood said:

Gotta love the "I admit to not knowing what I'm talking about, but here is some advice I'm nonetheless confident in" approach

Interestingly, this came out today (which mentions the Dutch Tulip craze):

"Why the Crypto Bubble Has finally Imploded" (*) by Adam Lashinsky on washingtonpost.com

Also interestingly, despite the "implosion," Bitcoin is worth about double what it was when these conversations occurred here in 2018.

And ...

Screenshot 2022-11-11 18.52.59.png 🤨

(*) This phrase in the article: "None of this has come true at any scale worth bragging about" makes me wonder if the author harbors a bit of schadenfreude. Me, I'm just an interested observer, and would lift all ships in the ocean if I could reign hard enough. God that was a shitty pun - so bad that it's funny enough to leave in for a day.

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On 11/11/2022 at 11:42 PM, DonRocks said:

"Why the Crypto Bubble Has finally Imploded" (*) by Adam Lashinsky on washingtonpost.com

Also interestingly, despite the "implosion," Bitcoin is worth about double what it was when these conversations occurred here in 2018.

Bitcoin has doubled since 2018, sure, but it's also true that the total market cap of cryptocurrencies is down by 2/3rds from their peaks. That's a big decline by any measure.  Bitcoin is down more than 2/3rds from its peak as well.  Bitcoin is holding up better than most this year, but my guess is that's because funds that must invest in crypto are being forced to sell coins like FTT, so what do they buy?  The big one.

Going forward, I think the big schism will come from whether Ethereum or Bitcoin emerges as the style leader (proof of stake vs. proof of work) - subject to an actual use case being proven.  US GAAP will also have a fair value model for crypto in the next few months, so that might prompt some more willingness to hold onto crypto - it's still only a few companies that do so today.

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