Bitcoin biting the dust?

[Jimmy Higgins]

Who ever said that libertarian paranoia isn't enough to justify the value of a make believe currency? If you answered "A bunch of people who don't have libertarian paranoia", you'd be right!

The good news, Bitcoin has lost about 50% of its value in the last month. While still worth over $3,200 each, that is a bit lower than the value a month ago of well over $6,300.

The bad news, Bitcoin has lost 82% of its peak value since the start of the year.

I'd say a few people made a great deal of money in the pyramid scheme known as Bitcoin. It went from loony Libertarian funny money, to explosively valued loony Libertarian funny money, to entering the mainstream for about three weeks legitimate investment, back to loony Libertarian funny money.

Some were absolutely certain that paranoia could be the legitimate basis for currency, but the never ending increase of the "currency's" value (deflation is never good for an economy as money becomes more valuable to hold than spend) to the severe devaluation of the "currency", making it impossible to hold value from day to day, seems to prove that paranoia isn't a legitimate basis for currency.

 

[Tom Sawyer]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

 

[SimpleDon]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

And you gained my vote for the obscure reference of the year. How many people here are going to understand your delightful post?

 

[Wiploc]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

And you gained my vote for the obscure reference of the year. How many people here are going to understand your delightful post?

I guess we can start a count:

1. Tom Sawyer

2. SimpleDon

3. wiploc

4.

 

[Artemus]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

And you gained my vote for the obscure reference of the year. How many people here are going to understand your delightful post?

I guess we can start a count:

1. Tom Sawyer

2. SimpleDon

3. wiploc

4.

4. Artemus


I've been watching the bitcoin crash with great amusement. It has all the disadvantages of the gold standard plus a whole lot more, and isn't even pretty like gold. What on earth were people thinking???

 

[lpetrich]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

Yes, the Dutch Tulip Mania, that very colorful economic bubble.

 

[hurtinbuckaroo]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

Yes, the Dutch Tulip Mania, that very colorful economic bubble.

That makes:

5) lpetrich
6) hurtinbuckaroo

 

[DBT]

Isn't the Dutch Tulip Mania Bubble a part of Economics 1O1? If not, there being so many versions, it should be used as an example in every classroom.

 

[Spacetime Inhabitant]

I have read several books that included details of the Dutch tulip mania, including the old classic Extraordinary Popular Delusions and the Madness of Crowds by Charles Mackay.

7) DBT
8) Spacetime Inhabitant

 

[RVonse]

The general premise of bitcoin is correct but what most are forgetting is that any government can and will outlaw a blockchain currency if they consider it a threat. All they need to do is forbid anyone from converting bitcoin to cash when it comes time to pay taxes. Those same taxes which have to be paid in US currency. So I never bought any bitcoin and thus I am still not a deci-millionaire.

I have heard a couple horror stories of people who made a fortune with bitcoin though. Sold bitcoin when it inflated to diversify and then lost big in the other cyber currency. Only to find themselves with no means to pay a huge 2018 IRS capital gains liability. What do you do when the IRS wants $400k taxes and your entire net worth is only a fraction of that? IMO, a capital gain should not be realized until the investment is converted into dollars again. But the IRS does not see it that way.

 

[southernhybrid]

I've been comparing Bitcoin to Dutch Tulip mania long before the first big crash. But then, women are usually better at predicting such things compared to men.

 

[TV and credit cards]

I saw Tulip Fever. It crashed too.

 

[Jimmy Higgins]

Okay, apparently everyone in this thread caught the reference.

 

[Jimmy Higgins]

The general premise of bitcoin is correct...

Even when the currency inflated too fast to be a viable currency and then deflated in value way too fast to maintain a value, you still want to say the general premise is correct. The Government didn't kill Bitcoin, Bitcoin was nothing but a pyramid scheme and it has collapsed. The US could not possibly have the world's top currency if its dollar had done what Bitcoin did.

I have heard a couple horror stories of people who made a fortune with bitcoin though. Sold bitcoin when it inflated to diversify and then lost big in the other cyber currency. Only to find themselves with no means to pay a huge 2018 IRS capital gains liability. What do you do when the IRS wants $400k taxes and your entire net worth is only a fraction of that? IMO, a capital gain should not be realized until the investment is converted into dollars again. But the IRS does not see it that way.

Man, it must suck to have pulled a Groundskeeper Willy.

 

[Tom Sawyer]

I have heard a couple horror stories of people who made a fortune with bitcoin though. Sold bitcoin when it inflated to diversify and then lost big in the other cyber currency. Only to find themselves with no means to pay a huge 2018 IRS capital gains liability. What do you do when the IRS wants $400k taxes and your entire net worth is only a fraction of that? IMO, a capital gain should not be realized until the investment is converted into dollars again. But the IRS does not see it that way.

It sounds like the IRS was correct. Every time you sell something, it's income and should be taxed. If you do additional transactions and lose money, those transactions aren't related to the previous ones and need to be accounted for separately, regardless of what form you sold it in. It was dumb of them to ignore the taxes payable on these transactions and this is their own damn fault, not the IRS's fault. These people aren't the victims here, they're just stupid and bad investors and they deserve these financial problems.

 

[Wiploc]

Okay, apparently everyone in this thread caught the reference.

...
9. Everyone

 

[untermensche]

Anybody who read or saw 'The Big Short' knows about the tulip bubble.

Anybody who lived through the 90's knows about the internet bubble.

 

[Canard DuJour]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

And you gained my vote for the obscure reference of the year. How many people here are going to understand your delightful post?

[raises hand at back of class] Me miss, me miss!!

 

[Jarhyn]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

And you gained my vote for the obscure reference of the year. How many people here are going to understand your delightful post?

Mmmmm I fucking love tulips.

But the thing is, the tulip industry has moved on. It's all about that Monero nowadays.

 

[Valjean]

Well, they still have some value, so holders of them can go to the Netherlands and use them to purchase tulips.

And you gained my vote for the obscure reference of the year. How many people here are going to understand your delightful post?

Who doesn't know what tulipmania was?