OT: Ray, how's your Bitcoin investment going?

[cinema]

Watched history being made last night as 600btc buy wall got eaten up in seconds. Very thankful for a small investment I made over 3 years ago. I think i'll pick up one of those Vanillas now. cheers friends.

[notsew]

Originally Posted by MattTuck

Also, Aswath Domadaran had a blogpost a few weeks ago talking about bitcoin, and made a compelling argument that it cannot be valued. It can be priced. Much like a currency or a collectible, there is no cashflow associated with owning the asset like there is with a stock or bond. As such, he argues there is no way to calculate an intrinsic value for bitcoin in the way you can with a stock.

This makes perfect sense to me. As far as I can tell its gold with less barriers to transactions basically (i.e., you don't have to have a place to store a bar). But then were talking about a scarce resource that we've decided to place value in essentially because it is shiny (and all the historical connotations that go along with it), and bitcoin doesn't have that.

The post about transaction times and costs was interesting. The thing that puts bitcoin at a disadvantage (processing time wise) is the lack of intermediary to facilitate transactions. But isn't that the whole point of bitcoin? (this isn't rhetorical, I don't know). In terms of processing large payments, like a paycheck, wouldn't it make more sense for a clearing house to adopt a similar technology more than using the highly volatile bitcoin for such a transaction? Isn't the blockchain technology the real breakthrough here? The value of a bitcoin could change dramatically just in the time it takes to process, that's pretty risky for something like your paycheck. And then it still has to be converted to a fiat currency to be used for day to day transactions.

I'm having trouble wrapping my head around its purpose beyond speculation. Thinking about it as a comparison to gold, or something else similar, I also can't see it behaving like gold does when the market goes bear.

This is an interesting discussion, I don't think I've really thought it through before. I'll have to watch that video and read up some more on it.

[54ny77]

it is the epitome of a bubble.

so much for the initial idea of it being a currency....

the only other currency that swings so wildly (albeit in the opposite direction!) is from one of the banana republics or some other 3rd world military or puppet dictatorship.

mattuck's posting of domodoran videos gave me cold sweats.....

i had a few classes with him. great to listen in on as spectator for intellectual curiosity, but brutal to internalize the micro details and then get tested on it.

Originally Posted by notsew

I'm having trouble wrapping my head around its purpose beyond speculation.

[MattTuck]

Originally Posted by cinema

Watched history being made last night as 600btc buy wall got eaten up in seconds. Very thankful for a small investment I made over 3 years ago. I think i'll pick up one of those Vanillas now. cheers friends.

Nice!

Originally Posted by notsew

This makes perfect sense to me. As far as I can tell its gold with less barriers to transactions basically (i.e., you don't have to have a place to store a bar). But then were talking about a scarce resource that we've decided to place value in essentially because it is shiny (and all the historical connotations that go along with it), and bitcoin doesn't have that.

The post about transaction times and costs was interesting. The thing that puts bitcoin at a disadvantage (processing time wise) is the lack of intermediary to facilitate transactions. But isn't that the whole point of bitcoin? (this isn't rhetorical, I don't know). In terms of processing large payments, like a paycheck, wouldn't it make more sense for a clearing house to adopt a similar technology more than using the highly volatile bitcoin for such a transaction? Isn't the blockchain technology the real breakthrough here? The value of a bitcoin could change dramatically just in the time it takes to process, that's pretty risky for something like your paycheck. And then it still has to be converted to a fiat currency to be used for day to day transactions.

I'm having trouble wrapping my head around its purpose beyond speculation. Thinking about it as a comparison to gold, or something else similar, I also can't see it behaving like gold does when the market goes bear.

This is an interesting discussion, I don't think I've really thought it through before. I'll have to watch that video and read up some more on it.

Yes, a big part of the early allure of bitcoin was the notion it was a decentralized network that did not require you to trust others in order to transact.

The intermediaries in normal financial transactions are not costless. They earn something for making the transactions seem faster. At some level you are paying for that, even if you do not realize it.

In bitcoin, it is just stripped bare. You have direct access to the payment system and the fee structure is visible to all. Obviously, positives and negatives associated with that. Not having trust in the other parties does make it much more tedious, and requires a better technical understanding of things that you don't need when you pull out your visa card.

Sometimes they talk about the idea of 'friction'... for the average person, there is still quite a bit of friction in bitcoin.

As far as the use cases you ponder, I think you're right. You cannot use something that is going up 10% or down 10% each week (or day!) as your unit of account. It just doesn't make sense. So, for sure, the volatility is a concern. I think the hope (of people who are holding bitcoin) is that the price rises to a high level and then settles down. Right now, you have incremental purchasers coming in that (presumably) are buying bitcoin for the first time. I'm inferring that from CoinBase's statements in the past few weeks that they're opening new accounts at an alarming rate.

So all that demand has to be satisfied with the existing supply, which I understand to actually be pretty small. And you get what we have here, which is rapid price increase. Once we run out of new people coming into the bitcoin world, demand will drop, then we'll see what the market really thinks of it. Of course, let's just say we're talking about the richest 1% of the world owning these things in meaningful quantities. That's still 70 million people possibly wanting in on the party. So, maybe there will continue to be new folks coming in for quite some time.

I should add, I'm not an expert, and I'm not for or against bitcoin. I just think it is interesting.

[MattTuck]

Originally Posted by 54ny77

mattuck's posting of domodoran videos gave me cold sweats.....

i had a few classes with him. great to listen in on as spectator for intellectual curiosity, but brutal to internalize the micro details and then get tested on it.

He visited my Valuation class when I was a student (he is friends with the professor). Seemed like a really nice guy, actually.

Maybe he was different with his own students

[thegunner]

Originally Posted by MattTuck

Yes, a big part of the early allure of bitcoin was the notion it was a decentralized network that did not require you to trust others in order to transact.

there was always the intrinsic trust that every node was acting in their own self interest (i.e. monetarily driven to solve and attach to the right block chain), so it's not quite that you don't have to trust others, it's that you have to trust others to have no ulterior / non-financial-gains interests.

but yes, agreed to the rest of your post

[cinema]

that last hourly candle was absolutely beautiful and blew people the hell out. there was a $100,000,000 market sell on bitfinex during 15 min

[redir]

I still don't get it.

[summilux]

Over and above the "true" value of BitCoin and the other alts, I find the psychology of this market truly incredible. Today looks like a rinse and repeat. Hopefully no one here is getting burned.

[cfox]

My friend and I built a rig to mine Litecoins a few years ago. It was a fun project, but it wasn't long before the difficulty grew to where our rig could not break even given power usage. I didn't accumulate many, and I hadn't given it much thought since LTC tanked shortly after we pulled the plug, but now that it's ~$90/LTC, I need to spend some time digging around old computers looking for my Litecoin wallet. I really don't remember how many I had. I also remembered an old Coinbase account I had...I logged in for the first time in 3 years to find I had a quarter of a BTC in there. Pretty funny, that .25/btc was worth $145 dollars the last time I logged in.

[superbowlpats]

Originally Posted by redir

I still don't get it.

you're not the only one

[cinema]

If anyone here works at a blockchain focused or cryptocurrency involved business please PM me. I have received a job offer from a crypto mining startup company and have some questions. I could provide some compensation for your knowledge.

Thanks!
Mike

[MattTuck]

Originally Posted by cinema

If anyone here works at a blockchain focused or cryptocurrency involved business please PM me. I have received a job offer from a crypto mining startup company and have some questions. I could provide some compensation for your knowledge.

Thanks!
Mike

Can't help you out with your question, but congrats!

I hope the offer isn't at Tezos

[nate2351]

Originally Posted by MattTuck

I hope the offer isn't at Tezos

or Bit Connect....

Coinbase has over 75 positions open, which is as many dev positions as all of Nordstroms last I checked. It's a brave new world out there.

[efuentes]

After being a fan for several years of the "Singularity" idea, I find it really interesting how more and more tech have become too complicated for most users. Brave new world indeed ...