
Bitcoin has crossed $6,000 USD for the first time - electic
https://twitter.com/coinhubplatform/status/921395537093332993
======
electic
If it makes anyone feel better. When the Bitcoin whitepaper came out, I read
it and thought it was neat. Then came the first mining program and I installed
it on my computer and it ran the CPU up. I said, "This is dumb." and
uninstalled it.

Huge mistake.

~~~
chrisabrams
It's not too late. If you think that it was dumb then, imagine 10 years from
now..

~~~
joering2
Unsure why you being downvoted; its actually quite good advise. If you
disagree then let's get into time machine and I tell you 10 years ago that one
bitcoin will be $6,000. As laughable back then as it is to think one bitcoin
will be $25,000, which I believe will become once all coins are mined and
there is limited quantity available in circulation.

~~~
chrisabrams
I meet people in NYC all the time that get angry when the topic of cryptos
comes up. Not everyone likes change.

~~~
companyhen
I think once it becomes more user friendly more outsiders will adopt. My
friends complain about there being so many different exchanges and the process
of buying altcoins too complicated. They don't like signing up for more than 1
different site, etc.

------
the_stc
I do not mind having Bitcoin keep going up. But as a business owner that
relies heavily on cryptocurrencies, I would really love it if things were more
stable. We are building a business on privacy, anonymity, and cryptocurrency
as a backbone. We're extrajurisdictional, so banking to USD or other fiat is
very tricky. Tether is a great idea, but the current company looks very
unstable. If there's a crash, they seem unlikely to be solvent.

Our company would pay a premium to get into a solid, pegged-to-USD coin. At
least 5% if not more. Or even a coin that's pegged to an ETF. Of course we
cannot satisfy KYC laws so it'd need to be a freely traded token, really.

I really hate the "hodlrs" and the complete lack of focus on how this is
supposed to work for real businesses that use it as a means to an end, and not
an end by itself.

I see this a lot talking about the 2x chain. People sometimes discuss it in
terms of what's better for the BTC price. Why is that a goal at all? Other
than the obvious reason of making current users richer?

~~~
erentz
If you want to transact in USD shouldn’t you use USD rather than a different
currency (BTC)? And if you want to use a block chain to transact in USD
shouldn’t you use something designed for that like Ripple?

~~~
the_stc
That'd be swell. As an EJC, transacting in USD is more difficult, hence we
must use cryptocurrencies.

Is Ripple pegged to USD? I do not want anything complicated, just a coin or
token that has a 1:1 ratio with USD. Charge me 5% or 10% to buy them or 5% on
cash out.

------
koolba
What's the volume / liquidity of Bitcoin these days?

Say you're Tim Draper and you're sitting on 30K (bought at $600 from the US
Gov in 2014 [1]). Would it be possible to offload them for $180M or is the
order book too thin?

[1]:
[https://en.wikipedia.org/wiki/Tim_Draper#Bitcoin_auction](https://en.wikipedia.org/wiki/Tim_Draper#Bitcoin_auction)

~~~
dharma1
Pretty good but still prob wouldn't want to dump that in a single day/single
exchange

[https://coinmarketcap.com/currencies/volume/24-hour/](https://coinmarketcap.com/currencies/volume/24-hour/)

------
api
I've asked it before but: how is this a desirable characteristic for a
_currency_?

This level of deflation is as bad as too much inflation, though the problems
it creates are different. Why would anyone actually use Bitcoin if simply
sitting on it will yield a greater return than investing it in anything? So
far it seems more deflationary than gold. If this keeps happening won't this
actually crowd out the currency application and lead to Bitcoin becoming
nothing more than a speculative bubble?

It's hard to determine but I'd love to see some data on Bitcoin _use_ vs. its
price in USD/EUR.

~~~
sbenitoj
Central banks have (without evidence) claimed that deflation is a universally
“bad thing” in order to justify inflating the currency every single year (AKA
stealing from savers, and transferring wealth to the people who are the
earliest recipients of the inflated currency).

Gold would have become the standard around the world if governments had not
used coercion to prevent it from becoming so, and instead replacing it with
fiat currency (which they can control and benefit from).

If Bitcoin, or another cryptocurrency, replaces fiat, it’s value will be worth
several orders of magnitude of what it’s worth today, which is why many people
are holding it instead of spending it at the moment.

However, people will not simply “horde” Bitcoin forever in anticipation of its
price going up any more than people currently spend every single fiat
dollar/euro/yen they have for fear of it going down in value due to inflation.

You may ask, “but why WOULDN’T they hold it instead of spend it if they
anticipate the value increasing each year?” The answer is because people HAVE
to live in the here and now, they have to pay for things like food, rent,
entertainment, cars, fuel, etc. So they can’t get around having to spend some
amount of money to live.

But sound money (money with low to no inflation) does cause people to spend
LESS money than fiat currency because there’s a much larger opportunity cost.

~~~
slg
Inflation encourages spending and investing while deflation encourages saving
and hoarding. It isn't a surprise that people who want to see the economic
activity want inflation over deflation. It also isn't a surprise why the
general population would prefer deflation over inflation. I can understand how
someone can make an ethical or moral argument for deflation, but I don't know
how you make a economic argument that deflation is better for the future of
the country than inflation.

~~~
sbenitoj
There are certain people who benefit from inflation (banks who loan money,
governments who have their debt denominated in fiat currency) and there are
people who lose from inflation (anyone who saves their money in fiat, the
value of which goes down the more money that’s printed). There is no such
thing as something that’s “good/bad” for a “country” — countries don’t exist,
only people do.

Also, Bitcoin IS inflationary, there will continue to be more Bitcoin creates
until sometime around year 2140 when the 21 Million supply cap is reached.
It’s just not nearly as inflationary as fiat currencies, which have no cap and
no one knows how much more will be created from year to year.

~~~
slg
Let me simplify things. Deflation is good for the individual. Inflation is
good for the whole. It is basically the tragedy of the commons. What is good
for a single person is not sustainable when scaled up to the whole of society.
With deflation spending and investing are discouraged. That is bad for
economic growth.

Also you are wrong about Bitcoin being inflationary. An expanding money supply
is not enough to make a currency inflationary. The rate of the increase in the
money supply needs to outpace growth in the economy. That isn't happening with
Bitcoin. The obvious proof of this fact is the increase in the value of
Bitcoin.

~~~
sbenitoj
You’re using a different definition of inflation.

There are two phenomena we’re talking about here — an increase in the supply
of money and the decrease in the purchasing power of money. The term inflation
is broadly used to apply to both of these but they’re different which is where
part of the hang up is.

In any case, the supply of Bitcoin will continue to increase until it hits 21m
coins in approximately 2140, but if it becomes the world’s dominant currency,
its purchasing power will continue to increase.

Why should spending and investing be encouraged, can you think of any
downsides to encouraging this?

~~~
slg
You are the one who described inflation as "stealing from savers, and
transferring wealth to the people who are the earliest recipients of the
inflated currency". That is talking about purchasing power and not money
supply.

There are certainly some situations when you want to encourage saving over
spending and investing. However I would argue it is not an ideal stable state.
It is more difficult for an economy to grow when people don't circulate money
through spending and don't increase future productivity through investing.

The benefit of a central bank that can control the money supply is that you
can adjust these things on the fly depending on what is happening in the
economy. Bitcoin cannot adjust the money supply in reaction to the economy.

~~~
sbenitoj
Well, the Austrian Business Cycle Theory [0] has shown that the continuous,
never ending increase in the money supply is actually responsible for greatly
exacerbating the boom and bust cycle, so there are in fact many losers of this
(people who invested money thinking it was safe when in reality it was a
highly speculative market, eg real estate in 2007, internet stocks in 2001,
etc).

Increasing the money supply ultimately leads to a decrease in purchasing
power, which is stealing from savers.

If the market (individuals cooperating with one another voluntarily) valued a
continuously inflated currency, then fiat currency will win and crypto will
fail. I suspect the market values a fixed or slow-increase-in-the-money-supply
version of money like gold as they demonstrated with their money preferences
before governments used coercion to stop it, one of the biggest reasons crypto
is so popular is because people can’t use gold as money, but governments can’t
effectively stop people from using crypto.

[0]
[https://en.m.wikipedia.org/wiki/Austrian_business_cycle_theo...](https://en.m.wikipedia.org/wiki/Austrian_business_cycle_theory)

------
chollida1
I love bitcoin, this rise comes just 3 days after it had its biggest one day
drop in a month. At this point it must be a CTA's dream instrument, all it
does is seem to trade on momentum:)

So if China shutting down exchanges, the CFTC coming out and claiming tokens
used in ICO's fall under its jurisdiction, confusing regulations everywhere,
and huge recent gains can't stop it, I'm not sure what will.

As a side note, if there are any Bloomberg engineers around, come on VCCY<GO>
is really awful.

Put some time into it, its not like virtual currencies are going away any time
soon.

~~~
soVeryTired
CTAs tend to have built in risk control :)

~~~
chollida1
No one said they didn't:)

Not a big deal most people don't understand that industry. The point I was
going for is that CTA's, more than anyone else, love good momentum stories as
they are the original trend followers.

------
albertgoeswoof
Probably related to [http://btcgpu.org/](http://btcgpu.org/) (another fork of
the chain coming in 4 days)

It's interesting that despite bitcoin being deflationary by design, you can
just fork the chain and do quantitative easing that way.

Pretty much all the cited benefits of cryptocurrencies are disappearing in
implementation, unfortunately.

~~~
aboodman
It only works if people use the forks, which ... doesn't seem to be happening
yet.

~~~
zanny
The incentives are completely backwards on why anyone would want to. All the
value is trapped in the blockstream bitcoin core client - deviating from that
sets the value of all those coins, all of which were _already mined_ and are
_already owned_ by wallets that may never even come on the fork.

Thats 80% of all coins. Yeah, your fork can kind of start from scratch, act
like the 16.6m coins that came before never happened, that most of them will
be dead forever, and start mining from there and treating all the new coins
mined (of the remaining 4.4m let) as the monetary base. But then you get any
momentum and suddenly "dead" money is flooding the market from legacy wallets.
Wallets that didn't contribute to the growth of the fork, that didn't harden
the blockchains integrity on the fork, that simply installed a program and had
a fortune ready to go with no effort and no commitment to that currency at
all.

There is already the problem that vast amounts of bitcoins blockchain hasn't
moved in years. Millions of coins that are being treated as dead that could
come back to life at any time. But there is no way to know what wallets are
actually gone - dat files lost, passwords forgotten, etc - and which ones are
just waiting to cash out.

Fundamentally the problem is there are two groups of people here - futurists
that want to overturn fiat, and investors that want to make (fiat) money. It
is why we have not seen a cryptocurrency that can behave like real money yet -
the closest we have gotten was dogecoin, which started as a joke and was
completely abandoned by its original developers and left to rot.

To make a cash replacement, it would need enough minting of coins to cause
inflation enough to keep people from stockpiling coins. But who wants to mine
your cryptocurrency or hold it early on in its life if its depreciating in
value from its own algorithms? The whole point of why people adopt early into
cryptocurrencies is that _if_ they blow up they just made millions from
trivial amounts of effort by just being there first. Classic pyramid scheme.

But all crypto today _has to be_ a pyramid scheme to get the adoption to start
having momentum to operate as it is intended. Without the gamble of making a
fortune how many people would have early on started bitcoin startups or
invested in mining? If the promise was that a coin worth a dollar today would
be worth a dollar ten years from now because the blockchain itself would
generate enough coins to peg the exchange rate, the only first mover advantage
you get is in how much less electricity it costs to mine early on _assuming
the coin takes off_ and becomes popular.

That can still be an incentive. It is still a gamble of course, but it is also
an incentive. The problem is when you are one of those investor types with
some large cash in a small neighborhood shopping for your next get rich quick
scheme the humble coin trying to push the future is a lot less interesting
than the pyramid scheme promising ludicrous returns _if_ it can get enough
fools to buy into it.

------
virtuexru
I always recommend this article to anyone interested in Bitcoin, it's a great
read: [https://fee.org/articles/what-gave-bitcoin-its-
value/](https://fee.org/articles/what-gave-bitcoin-its-value/)

------
holtalanm
wishing i had actually kept my mining program running when I experimentally
installed it and ran it for about 30 minutes ~5-6 years ago now.

~~~
shmageggy
This made me realize I think I just recycled the hard drive with my old
bitcoin wallet on it. I had half a bitcoin that I mined in a few nights on my
old Geforce 4 GPU. Fuck me!

~~~
Klathmon
I just learned last week. I found the word bitcoin next a last modified date
of 2011 in my backups while looking for something else.

My heart kind of started racing as I looked through it. The backup was of a
mining program I was using, and it had the address that I was mining to.
Looked up the address, it has 13.3 BTC in it!

I started unpacking the whole archive to find the wallet, only to learn that I
didn't backup the wallet.dat. I don't know why I didn't, probably some
combination of it being worth like $30 at the time + not knowing exactly where
the private key was stored.

But it brings the total amount of bitcoin i've lost over the years up to
23.3...

------
Sir_Cmpwn
Remember that bitcoin pizza? Today worth $60 million.

------
todayiamme
Say what you will, but this irrational exuberance is precisely that;
irrational. I knew about Bitcoin 6+ years ago, when I read a blog about
someone buying a sandwich with this newfangled currency. But I didn't rush to
mine it. I didn't rush to buy it either. I was simply indifferent to the
prospect of it, and I don't regret it.

Here's why. Bitcoin's thesis is that it possesses inherent value because it
will become a medium of exchange i.e. people will trade in bitcoin, thereby
using it as a store of value, and making it valuable. And yet, that hasn't
happened yet. While it's hard to estimate the velocity of money for something
like Bitcoin, and the "Bitcoin days destroyed" metric isn't accurate either,
it is quite clear that as Bitcoin as a store of wealth rises rapidly in value,
its utility as a currency correspondingly drops in value; thereby invalidating
the central thesis on which the question of its value rests.

Here are rough estimations for the velocity of money for BTC;

[http://charts.woobull.com/bitcoin-
velocity/](http://charts.woobull.com/bitcoin-velocity/)

[https://charts.bitcoin.com/chart/velocity](https://charts.bitcoin.com/chart/velocity)

Even if these are filled with inaccuracies, the general trend seems to be
quite clear. People use BTC as an asset not a currency. And as such, the idea
that it's a savvy investment belies the fact that it's value as an asset is
entirely psychological in nature and completely ungrounded from actual metrics
like fiat currency (though again fiat currency does run on trust, but the
difference is that it's a marker of exchange thereby measuring the economy and
its productivity gives an estimate of its value).

Further, even if it was a valid currency, then what we're witnessing over here
is hyperdeflation in action, and it is fundamentally irrational to expect it
to continue.

The reasoning for the above points is quite straightforward and simple. The
magic of money and capitalism isn't that you can hoard gold and get rich. No,
it's that you can _make_ money. It's the idea that value can be created and
destroyed through the economic actions of human beings, and that money as a
concept serves as a measure of wealth as opposed to wealth. It's why we moved
away from the gold standard - it was fundamentally irrational and in the long
run, would have caused the exact phenomena we're seeing with BTC.

If you really think that somehow as a store of value BTC is going to become
some significant fraction of human wealth, then go ahead buy this. But if you
give it any rational thought whatsoever, then you'll see clearly that this is
the tulip mania in action and that timing your actions to beat the market is
even more irrational.

So no I don't regret passing up on buying BTC, precisely because it was and is
a lottery ticket and I'm not in the business of buying lottery tickets no
matter how well conceived they may be.

Right now, the most rational thing to do is to bet for it to fail. And then
figure out how to time that bet. Because the farther it rises, the harder it
will fall.

Good luck.

~~~
fragsworth
> So no I don't regret passing up on buying BTC, precisely because it was and
> is a lottery ticket and I'm not in the business of buying lottery tickets no
> matter how well conceived they may be.

Dude, this is nonsense. Everyone regrets passing up on buying BTC because it's
currently worth $6k because you can sell it _right now_ for that money.
Anything else is complex rationalization to make yourself feel better.

~~~
zzalpha
Nonsense indeed...

I made what I believed was a rational risk assessment at the time (back when
MtGox was spinning up... Not exactly the most credible days for BTC) and
decided to avoid the hype.

Could I use the money now? Sure. It's money.

But I don't regret the decision now because I was acting on the information I
had.

Heck, even now, it's possible for someone to buy BTC and for it to crash.
Should those people regret _their_ decision even if, in their estimation, it's
rational now?

To be blunt: if you spend any time regretting these types of things you're a
gambler, not an investor, and will find yourself tricked into trying to time
markets. And that will eventually bite you in the ass.

As for me, the same reasoning that kept me out of the market then keeps me out
now: I don't believe in the fundamentals and I'm not a gambler. Full stop.

For those who do, the should buy and hold for the long term to realize the
most gains.

But "it's worth a lot more now than it was 10 years ago" is not fundamentals.
It's just the irrational assumption that past performance predicts future
behaviour.

------
leoharsha2
Can anyone please tell me Is it a good time to buy ETH/BTC or am I too late?

~~~
underyx
If you get and aggregate everyone's advice you'll get to the conclusion that
the correct price for Bitcoin is exactly where it's at now.

~~~
pmoriarty
You're assuming it's priced fairly and there's no cheating or other
manipulation in the price.

------
conn01
I think hackernews should rename to vcnews

------
diminish
Basically I don't see any target value for bitcoins and there's no bubble
since this is a once upon a life time opportunity. Basically since number of
bitcoins will be limited - total value of all bitcoins must be a fraction to
total human wealth. Tech leaders and SV have strongly stood behind bitcoin and
blockchain with convincing arguments, and put their credibility behind it and
each day by increasing valuation of Bitcoin they prove why tech matters on
this planet.

Edit: /S If a bubble forms and people's finances get hurt, that'll have very
negative effect on the credibility of SV and tech sadly.

~~~
jonknee
> Basically since number of bitcoins will be limited - total value of all
> bitcoins must be a fraction to total human wealth.

Or they could be worth nothing?

~~~
kovek
Are there no valuable use cases with Bitcoin?

~~~
companyhen
I know fees are higher now, but a big use case could potentially be people
sending money to friends/family overseas. They're much lower fees comparing
them to Western Union. Saw that in the Banking on Bitcoin documentary on
Netflix, I recommend watching!

~~~
jonknee
Possibly lower fees than existing solutions, but you have to factor in
converting currencies, crossing the bid ask spread twice on different
exchanges and the risk of volatility during the transaction. If you want a low
cost transfer you're much better off using something like TransferWise.

------
buttershakes
I think this is just the tip of the iceberg for Bitcoin. Time will tell if I
am right or wrong. If we think of it as simply a currency, or a store of value
we can place limits on its value based on what we know about gold, fiat
currency, etc. We can extrapolate and come up with a valuation that we think
is appropriate. However, its not just any of those things. It's a paradigm
shift in digital ownership of value, and could potentially be a record of and
a secure digital token for a huge variety of physical goods, virtual services,
etc. Whether this happens is largely dependent on scale, but we will leave
that argument for another thread since the troll army will show up. Bitcoin is
something entirely new in the history of value transfer and ownership, stop
trying to compare it directly with the systems that will be eclipsed by it.

