
Bitcoin – Millennials Fake Gold - adambyrtek
http://contrarianedge.com/2017/12/01/bitcoin-millennials-fake-gold/
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cvsh
All the kids from my high school still working menial jobs in my hometown 10
years later have been buzzing about buying Bitcoin all weekend up and down my
Facebook feed. To me, there's no clearer sign that any money to be made during
this rally has already been made.

I liquidated all my cryptocurrency holdings on Friday. When Wall Street steps
in this week and shorts it, it's difficult for me to envision any other
outcome than all those kids panicking and selling.

~~~
adameast9000
Same here. All of the sudden all of the college dropouts from my area are
blockchain experts, talking up new coins as if they read the whitepaper (as if
that is enough anyway). These are the "get rich quick" folks, the same ones
who were selling herbalife(or vemma or whatever) a few years ago. Despite
this, I can't say for sure that they'd sell given some serious volatility.
There's a growing cult like groupthink attitude best represented by the phrase
"HODL".

There's also some serious fraud allegations at the exchange level, and I think
there may be some truth to the rumor that USDT is being printed to drive up
the price of BTC.

While all of this is concerning, it's hard to believe that BTC will drop lower
than 1-2k in a panic. I think the market value has been established on a
psychological level. I think blockchain is going to be taught in ECON101
classes in a few years. And while I don't think BTC is the best cyptocurrency,
I believe in the coming years its value will stabilize, transaction fees will
get fixed, and it will be a great store of value. It will be especially
valuable for those without access to good banking systems.

The other really big problem is liquidity/access. I live in NYC and my
coinbase account was randomly locked a few months ago(good luck if this
happens to you). Now the only way I can buy/sell bitcoin is at a cash ATM with
an 8% fee, or buy.bitcoin.com with a 7.5% fee. Bitcoin doesn't solve the
problems of those without access to good banking if it's impossible to
reasonably buy. I think this will get better too, but it's definitely gotten
worse recently.

In conclusion: I think there's a chance BTC could be worth less than it is now
this time next year. I think in 2 years, the total market cap of
cryptocurrencies will be significantly higher than it is today.

~~~
cvsh
>Despite this, I can't say for sure that they'd sell given some serious
volatility. There's a growing cult like groupthink attitude best represented
by the phrase "HODL".

True, but the rise in price seems to have largely been due to newcomers
entering the market who don't share the attitude of longtime HODLers. See:
Coinbase shooting to #1 on the App Store. I think that raises the odds of a
crash considerably. The new crowd is in it because they expect the rally to
continue and if they realize it won't, they'll want out en masse ASAP.

~~~
adameast9000
Yes. I may have not been clear, I do think BTC is in a bubble. When my 60 year
old parents, who can barely figure out how to use netflix are asking me if
they should buy bitcoin, there is a serious problem. Though I do not think it
will be as bad as people like OP are predicting. 1000 entities control 40% of
the circulation of BTC. They will be much less likely to liquidate in any
event. Thus you have some solid stability there I suppose.

On a semi related note, I'm curious to know more about the profile of altcoin
holders. In the event of a BTC fallout, would these crash as well? Or will we
see a rush to those currencies due to the inevitable difficulty in converting
BTC->USD/EUR/etc? I have so many questions...

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ohquu
Wow, what a totally original and fresh perspective.

Also, I don't like watching the author's face pop up every thirty seconds
while I'm reading the article, telling me he's the next Benjamin Graham.

~~~
spondyl
I thought this was a joke but the quote is literally "Vitaliy Katsenelson is
the new Benjamin Graham"

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superquest
TLDR:

\- Bitcoin is an "un-valuable" as an investment security.

\- Bitcoin is only worth something because we agree that it should be worth
something, and this consensus is fragile.

\- Governments will outlaw it.

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bdamm
There will come a reckoning when these kinds of analysts realize they simply
weren’t working hard enough to understand the value that crypto currencies,
and specifically bitcoin, bring. They’re _useful_.

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mdotk
Yes, kids with no money are the reason that billions have been pumped into
Bitcoin the last week.

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hyprCoin
Nice unbiased report

> A client jokingly told me that his biggest gripe with me in 2016 and 2017
> was that I didn’t buy him any Bitcoin. I told him not so jokingly that if I
> bought him Bitcoin, he’d be right to fire me. Maybe I’m a dinosaur; but,
> like gold, Bitcoin is impossible to value. What is it worth?

I get it that you feel like you missed the boat. The boat hasn't left the
harbor in the actually useful ecosystem of crypto currencies. Bitcoin is not
the end-all

~~~
autokad
i'd fire him because he thinks gold is impossible to value.

~~~
bdamm
Although this is the not so subtle secret about gold isn’t it. If you invested
in gold simply due to the inherent industrial value, you’d never get in at
this price.

~~~
hackinthebochs
This is exactly why I don't think ETH has any long term value aside from its
potential to unseat bitcoin as the dominant cryptocurrency. I just don't
imagine even an ideal world of distributed applications running on ethereum to
be worth billions. The demand for obnoxiously slow running
distributed/trustless applications is extremely small in the scheme of things.
Most real world cases in need of "programmable money" will just deposit to a
centralized site where all the programmatic features will execute and then
distribute back the result. Trustlessness just isn't that valuable outside of
the currency itself.

~~~
hyprCoin
It's important not to conflate the present issues with the eventual issues.
Eventually, ETH will be an immediate and decentralized distributed value
network with extremely low to nonexistent processing fees.

When we are dealing with money, trustlessness means not asking permission. It
also means you can review what the code is doing before sending your valuable
money to it. We also get a global headless processing center for free.

I think you should re-evaluate your opinions on eth. But, maybe you are right
and people are ok with throwing their money into a centralized repository.
Maybe visual sourcesafe will make a comeback as well.

~~~
hackinthebochs
My point was that its currency features are the only thing that make it
potentially valuable. It being a "distributed computer" like some people
envision is doomed to failure. Programmable money is useful, but not to the
tune of multi-billions. The majority of value is in the trustless money
aspect, not the trustless programmability. Most people will have no problem
trusting sites for short periods with smallish amounts.

That's not to say there wont be any use-cases, or even many. There could be
very many use cases for eth in fact, but it still not be multi-billion market
cap valuable.

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paul7986
Curious for those who own bitcoins ... how are you using it to enrich your
life? Buying a lot of things on Overstock.com, eating at Subway frequently,
buying eGifter gift cards (that looks like the best deal), selling gift cards
at a small loss ($75 for $100 gift card) or other ways?

I was going to buy a bitcoin or two in 2013 when it was $400 and my co-workers
at the time, but darn I didnt.

~~~
Helloworldboy
> how are you using it to enrich your life?

Selling them for way more than I bought them.

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backpropaganda
Why don't such hitpieces talk about the non-liquidability of bitcoin? Sure the
price is 15k right now, but can anyone actually convert a large number of
coins to USD with this price? Wouldn't this trigger a sharp decrease in price
as soon as people start seeing people selling their BTC?

~~~
thwoaraway2
This is an issue with liquidating most stock portfolios also, so I'm not
really sure what you are getting at. This is usually worked around by people
unloading in smaller increments over a longer period of time, just like people
do with say a stock vestment.

~~~
cjalmeida
Except stock portfolio usually pays dividend or growths economically by ways
of profits (or the expectation of it).

Bitcoin does not grow (asymptotically) by design. So, unless you assume it has
intrinsic non economic value (like gold), it makes little​ sense to hold it
due to low liquidity.

But gold is established as a value store. You can buy and sell massive amounts
of it anytime you want.

BTC? It's more like holding a fortune in blood diamonds.

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dominotw
>The Chinese government outlawed cryptocurrencies in September 2017.

Wasnt it just ICO's?

~~~
tr4cefl0w
Yes, else they wouldn’t allow NEO to exist.

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tzury
As Cryptocurrency will evolve, and zillions of great other blockchain
implementation will be out there solving real-world distributed data problems,
bitcoin will be a piece of nostalgia no more than that.

------
tzury
Why flagged?

