• Welcome to the new Internet Infidels Discussion Board, formerly Talk Freethought.

Is Crypto dying or just dropping for the moment?

Jimmy Higgins

Contributor
Joined
Feb 1, 2001
Messages
35,577
Basic Beliefs
Calvinistic Atheist
link

Cryptocurrency is quite possibly one of the easiest ways to make money... if you were reckless and invested real early and refused to sell out at all of the wild swings. $10 on Bitcoin at $10 a coin would be worth $40,000 today. The trouble is, cryptocurrency has almost no basis for its value, so it can easily sway when a person like Elon Musk announces he is accepting Bitcoin at Tesla or won't accept Bitcoin at Tesla... or talks on SNL.
article said:
What's happening: Bitcoin prices have plummeted about 12% to less than $50,000 in the last 24 hours, according to Coindesk. The decline comes after Musk, Tesla's CEO and a vocal bitcoin advocate, said his company was suspending plans to accept the cryptocurrency as payment for electric vehicles, citing its "high environmental cost."
Crypto has dropped notably since SNL broadcasted. Which is never a good sign for an investment if SNL can impact its value heavily.

Cryptocurrency is currently living a lie. That it is well... currency at all. Currency, in order to be useful, must maintain a value. Currency with huge swings in value is harmful for economy. Ironic that those that vouch for it whine about inflation, when Bitcoin has deflated like a balloon crushed by a 100-ton safe.

So with Musk saying 'backsies' over Bitcoin at Tesla, Bitcoin has dropped 10%, I think in part because it exposes the lie of Bitcoin's viability as a currency. Of course, wild drops are not uncommon for imagery funny money, so this could be a periodic drop. The one thing that makes me ponder this is the end is that normal people are investing now. And usually when the normal people are investing, that is the peak of the pyramid, and the sell off begins. Cryptocurrency is tantalizing, as the chance to make money was real (if not reckless and baseless). And that past performances idiom is getting ignored. New start up cryptos are coming out almost like Internet companies in the late 90s, which led to a deflation of that bubble.
 

Tom Sawyer

Super Moderator
Staff member
Joined
Jun 25, 2002
Messages
17,030
Location
Toronto
Basic Beliefs
That I'm God
It's value is based on absolutely nothing at all, so confidence that other people will continue joining in at the bottom of the pyramid scheme is the only thing which keeps it making money. This means that the more people who have issues with it, the less suckers there are to bleed dry. The people who understand what bitcoin is (or rather, what it isn't) have been raking in the cash, but there comes a point where they need to decide whether or not it's time to cut their losses because too many have caught onto their scam. Once more of those start saying that it's time, the descending spiral begins.
 

southernhybrid

Contributor
Joined
Aug 13, 2001
Messages
6,438
Location
Georgia, US
Basic Beliefs
atheist
My understanding is that the reason for today's crypto crash is due to people finding out that they have to pay federal taxes on the money once they use it. So, that 40K that was made on the 10 dollar purchase would be taxed as soon as it was spent. At least that's what CNBC is giving as an explanation for the crash. Apparently, a lot of people didn't understand how complicated the tax laws are in regards to crypto. It's like buying a stock. You pay the tax once you sell the stock, assuming you made money on it. You only pay the capital gains rate if you held it for over a year, otherwise it's taxed the same an other income. OF course, that's just US tax rules. I have no idea how this works in other countries.

I watched MusK on SNL. The reason given as to why his crypto crashed was because he joked about it being a scam. I don't remember the exact wording but it did give one the impression, even if it was meant as a joke, that crypto was a scam.

Crypto is just too weird for me. It is highly volatile and it's hard to understand how much it will be used in the future. It seems to be mostly used now as dark money used for illegal things, like when hackers ask for ransom when they shut down an oil pipe line. They want to be paid in crypto. Another weird thing about Bitcoin is that if you lose your password, you're fucked. I read about somebody who had a good amount of crypto lost his password, so he lost his entire investment in crypto.
 

Politesse

Lux Aeterna
Joined
Feb 27, 2018
Messages
8,145
Location
Chochenyo Territory, US
Gender
any
Basic Beliefs
Jedi Wayseeker
All money has purely imagined value; what makes it real is its acceptance by social convention and powerful economic institutions, not any inherent property of the medium. What Cryptocurrency has crucially failed to do is gain acceptance as anything other than the identity marker of a certain very narrow societal subgrouping, a demographic slice that is wealthy but largely inconsequential to the basic economic processes that move the world along.
 

jonatha

Veteran Member
Joined
Sep 17, 2002
Messages
2,499
Location
Kentucky
Basic Beliefs
Agnostic
My understanding is that the reason for today's crypto crash is due to people finding out that they have to pay federal taxes on the money once they use it. So, that 40K that was made on the 10 dollar purchase would be taxed as soon as it was spent. At least that's what CNBC is giving as an explanation for the crash. Apparently, a lot of people didn't understand how complicated the tax laws are in regards to crypto. It's like buying a stock. You pay the tax once you sell the stock, assuming you made money on it. You only pay the capital gains rate if you held it for over a year, otherwise it's taxed the same an other income. OF course, that's just US tax rules. I have no idea how this works in other countries.

I don't know why it's crashing (it had no business inflating in the first place), but the tax laws regarding crypto are quite a bit simpler than those governing steock sales. No wash rule, to begin with.

Anybody who's ever invested in anything ought to be familiar with the idea that if you sell something for more than you bought it for you will pay tax on the difference...
 

Jimmy Higgins

Contributor
Joined
Feb 1, 2001
Messages
35,577
Basic Beliefs
Calvinistic Atheist
Looking at Coindesk and I saw Nano. The thing spiked and unspiked on April 17th.

April 17th

- Noon: $8.99
- 8 PM: $14.09 (67% increase)
- Midnight: $9.19

WTF dude! What shady stuff is driving that? As if assets were exchanged using the crypto as cover.
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
Looking at Coindesk and I saw Nano. The thing spiked and unspiked on April 17th.

April 17th

- Noon: $8.99
- 8 PM: $14.09 (67% increase)
- Midnight: $9.19

WTF dude! What shady stuff is driving that? As if assets were exchanged using the crypto as cover.
Small stocks can also fly around like this. It seems that the younger generation likes to play in the crypto space.

Go Shiba:) that one almost got me to go and pick up a crypto wallet...
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
All money has purely imagined value; what makes it real is its acceptance by social convention and powerful economic institutions, not any inherent property of the medium. What Cryptocurrency has crucially failed to do is gain acceptance as anything other than the identity marker of a certain very narrow societal subgrouping, a demographic slice that is wealthy but largely inconsequential to the basic economic processes that move the world along.
Yep! Though Etherum is trying to work on having functionality..
 

TomC

Celestial Highness
Staff member
Joined
Oct 1, 2020
Messages
4,024
Location
Midwestern USA
Gender
Faggot
Basic Beliefs
Agnostic deist
Cryptocurrency has always looked like a Ponzi scheme to me.
Of course, I'm not very well versed on any of the concepts. I've still not entrusted a computer with a credit card number. I buy almost nothing on line, and use disposable cards for that.

Yeah, I'm old.
Tom
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
Tom, do you entrust your CC to a minimum wage restaurant worker who takes it out of site?
 

Jimmy Higgins

Contributor
Joined
Feb 1, 2001
Messages
35,577
Basic Beliefs
Calvinistic Atheist
Cryptocurrency has always looked like a Ponzi scheme to me.
Of course, I'm not very well versed on any of the concepts. I've still not entrusted a computer with a credit card number. I buy almost nothing on line, and use disposable cards for that.

Yeah, I'm old.
Tom
Meanwhile all of your in-store purchases and CC info were stolen online from Target, Home Depot, etc...
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
Another weird thing about Bitcoin is that if you lose your password, you're fucked. I read about somebody who had a good amount of crypto lost his password, so he lost his entire investment in crypto.
That is true for any encryption that is good. I knew a guy who encrypted his taxes to store on a cloud drive. But he died suddenly, and his wife and kids were locked out as he didn't have a backup plan. So smart with 2 PHDs, but not very practical...
 

Swammerdami

Squadron Leader
Staff member
Joined
Dec 16, 2017
Messages
2,509
Location
Land of Smiles
Basic Beliefs
pseudo-deism
There is about $1 Trillion of wealth stored in Bitcoins right now (minus the unknown billions lost due to forgotten passwords), along with about another $1 Trillion in several other cryptocoins. I thought of putting "wealth" in quotation-marks, but this wealth is just as real (or as unreal) as the wealth stored in Facebook or Pepsico stock.

IIUC, Bitcoin may be approaching the end of its road. There is an imposed limit of 21 million Bitcoins and there are already 19.6+ million. The rewards for mining the coins are diminishing. HOWEVER, the Bitcoin community is a weird amalgam of anarchy and democracy and, IIUC the community MIGHT change the rules. (As mining fees diminish, miners may charge to incorporate transactions. Is this being done yet?)

I tried some Googling and arithmetic just now; did I make a mistake? Over the past 12 months, 135 Twh of electricity has been spent mining Bitcoin; that's about $18 Billion of electricity! If I divide that by the number of coins mined in 12 months I get about $53,000 — about the current price of a Coin. I suppose that should be expected: If it were very profitable to mine Bitcoins, more would enter the business and competition would drive down the mining rate. Is this all correct?

A lot of rich investors have been buying cryptocurrencies. Rather than seeing this as a belief that Coins are a better bet than stocks, I think it's just the wise course of diversifying across all asset classes: a good idea to ensure capital preservation. If I were rich and/or an active investor I'd probably own some Coins, but I don't, and don't intend to buy any. Will the price fall? I dunno. I don't have great faith in stocks, bonds or dollars either.

All money has purely imagined value; what makes it real is its acceptance by social convention and powerful economic institutions, not any inherent property of the medium....

For thousands of years, gold and silver were used as money. If their value is imaginary then so are the values of copper, tin, slabs of Italian marble and olive oil. I wouldn't be at all surprised if precious metals make a comeback as money later in this century.

Some will argue that Bitcoins have a "real value" related to their mining cost, which — if I haven't erred — is about the same as Bitcoin's current market price! However the huge sums spent on computation have not created anything with intrinsic worth. Just the opposite: bit-mining is deliberate "busy work." Wasteful computations are a deliberate feature of the "clever" blockchain design.

The electricity wasted on Bitcoin mining ($18 Billion worth in the most recent 12 months) will seem shameful when we recall that humanity wants to reduce power usage to cut CO2 emissions. I think this problem is what Elon Musk reacted to.
 

TomC

Celestial Highness
Staff member
Joined
Oct 1, 2020
Messages
4,024
Location
Midwestern USA
Gender
Faggot
Basic Beliefs
Agnostic deist
Tom, do you entrust your CC to a minimum wage restaurant worker who takes it out of site?

Generally, no.
I strongly prefer cash in situations like that. I prefer cash, period.
When I do, I am really careful about checking the statement. I like "bank by phone" where I can check things daily, if I want.
Tom
 

TomC

Celestial Highness
Staff member
Joined
Oct 1, 2020
Messages
4,024
Location
Midwestern USA
Gender
Faggot
Basic Beliefs
Agnostic deist
Cryptocurrency has always looked like a Ponzi scheme to me.
Of course, I'm not very well versed on any of the concepts. I've still not entrusted a computer with a credit card number. I buy almost nothing on line, and use disposable cards for that.

Yeah, I'm old.
Tom
Meanwhile all of your in-store purchases and CC info were stolen online from Target, Home Depot, etc...

Hasn't happened, and very unlikely to happen.
Not impossible, but I use cash as much as possible.
Tom
 

Jimmy Higgins

Contributor
Joined
Feb 1, 2001
Messages
35,577
Basic Beliefs
Calvinistic Atheist
Cryptocurrency has always looked like a Ponzi scheme to me.
Of course, I'm not very well versed on any of the concepts. I've still not entrusted a computer with a credit card number. I buy almost nothing on line, and use disposable cards for that.

Yeah, I'm old.
Tom
Meanwhile all of your in-store purchases and CC info were stolen online from Target, Home Depot, etc...

Hasn't happened, and very unlikely to happen.
Not impossible, but I use cash as much as possible.
Tom
Has as it did. Several stores were hacked... or just had their info hanging out there.
 

Jarhyn

Wizard
Joined
Mar 29, 2010
Messages
9,052
Gender
No pls.
Basic Beliefs
Natural Philosophy, Game Theoretic Ethicist
ITT: people not understanding the issue with crypto.

Crypto is dying for various reasons. No one reason is going to capture all of it.

The reason I have stepped away from it is twofold, and originates in a concept called Proof of Work vs Proof of Stake.

Most crypto is proof of work. People prove that they are doing [meaningless busy]work to turn the wheel and win the next block lottery. Bitcoin is exclusively trapped into the proof of work paradigm. Bitcoin is the biggest crypto so it ends up being the leader of price changes.

The problem is that Proof of Work efficiently consumes all energy in pursuit of arbitrary value. Literally, we are spending untold amounts of energy on this Proof of Busywork concept. And even if we made the work easy, it would still tend towards infinite expansion of resource consumption because the fastest computer still makes the most spacebux doing the work before others may.

This is THE reason that most technologists will find reasons to divorce themselves from it.

Related to this are the fees: as Bitcoin gets more valuable, the fees to transact go up. At this point, even small transactions on BTC can end up with 20 dollar fees. This is not tenable either.

Finally, the only thing you can spend any of it on is the black market or pyramid scheme style speculation.

Only people I know on Crypto are idiots and drug dealers/buyers.
 

bilby

Fair dinkum thinkum
Joined
Mar 7, 2007
Messages
26,789
Location
The Sunshine State: The one with Crocs, not Gators
Gender
He/Him
Basic Beliefs
Strong Atheist
For thousands of years, gold and silver were used as money. If their value is imaginary then so are the values of copper, tin, slabs of Italian marble and olive oil. I wouldn't be at all surprised if precious metals make a comeback as money later in this century.

The commodity value of gold is a tiny fraction of its spot price, and has exactly the same basis as the value of bitcoin - none at all.

If you have the vast majority of a metal that has ever been mined simply sitting around in warehouses unused, its intrinsic value as metal is very low indeed; When that inventory costs a lot of money to guard, the value proposition in keeping hold of it is highly dubious.

If there were vast stores of copper ingots in warehouses worldwide, the spot copper price would plummet, and mining would cease as it would be hugely unprofitable. But gold hasn't yet seen such a crash in value, solely because people still expect to be able to trade it for real money.

Real money is money someone somewhere is required to have - almost invariably because a government demands it for payment of taxes.

If nobody's accepting tax payments in a 'currency', then its intrinsic value is zip, and any value it has lies purely in the expectation that it can be exchanged for a real currency when the taxman comes a-calling.

Gold and silver used to be currency in the sense of being accepted ways to pay tax. And markets are irrational and have long memories. But there's no particular reason why gold shouldn't crash in value, nor why it should recover from any crash. Reason isn't even a factor. People like gold because they know that people like gold.

People like copper, tin, and olive oil because they are useful. Italian marble is pretty and it's fairly rare. Gold is pretty, but there's tons of it just sitting around gathering dust, hidden away in bank vaults.
 

Trausti

Contributor
Warning Level 1
Joined
Jul 30, 2005
Messages
9,736
Location
Northwest
Gender
Who/Whom
Basic Beliefs
Atheist Norse
E1QlVL0XoAck1uM
 

southernhybrid

Contributor
Joined
Aug 13, 2001
Messages
6,438
Location
Georgia, US
Basic Beliefs
atheist
All money has purely imagined value; what makes it real is its acceptance by social convention and powerful economic institutions, not any inherent property of the medium. What Cryptocurrency has crucially failed to do is gain acceptance as anything other than the identity marker of a certain very narrow societal subgrouping, a demographic slice that is wealthy but largely inconsequential to the basic economic processes that move the world along.

Of course, but the dollar is backed by the US government. As long as there is trust in the government, the dollar has value. What exactly backs Bitcoin? Everything humans make up are based on myths.
 

Jimmy Higgins

Contributor
Joined
Feb 1, 2001
Messages
35,577
Basic Beliefs
Calvinistic Atheist
The trouble with gold as currency is the same as Bitcoin, just with a much smaller amount (but still way too high) of instability. The US dollar has worked, for the most part, in keeping things stable for currency. Nixon fucked things up into the 70s, but otherwise, it has worked out. But the gold bugs want MGGA, when it was never a great currency basis to begin with.
 

TomC

Celestial Highness
Staff member
Joined
Oct 1, 2020
Messages
4,024
Location
Midwestern USA
Gender
Faggot
Basic Beliefs
Agnostic deist
Hasn't happened, and very unlikely to happen.
Not impossible, but I use cash as much as possible.
Tom
Has as it did. Several stores were hacked... or just had their info hanging out there.

It didn't happen.

I don't do business the way the vulnerable do. It isn't likely to happen. I'm more likely to be a victim of a home invasion, which is also extremely unlikely.

If my bank got hacked, then I'd have a problem. But I've also got FDIC, I think. I dunno. I take precautions, but don't sweat the remote possibilities.

Tom
 

southernhybrid

Contributor
Joined
Aug 13, 2001
Messages
6,438
Location
Georgia, US
Basic Beliefs
atheist
My understanding is that the reason for today's crypto crash is due to people finding out that they have to pay federal taxes on the money once they use it. So, that 40K that was made on the 10 dollar purchase would be taxed as soon as it was spent. At least that's what CNBC is giving as an explanation for the crash. Apparently, a lot of people didn't understand how complicated the tax laws are in regards to crypto. It's like buying a stock. You pay the tax once you sell the stock, assuming you made money on it. You only pay the capital gains rate if you held it for over a year, otherwise it's taxed the same an other income. OF course, that's just US tax rules. I have no idea how this works in other countries.

True, but I was given the impression that some of the Bitcoin investors weren't very sophisticated when it comes to investing. Or maybe they simply weren't thinking since crypto is imo, a rather weird and risky investment. Then again, so are stocks when you really think about it.

I don't know why it's crashing (it had no business inflating in the first place), but the tax laws regarding crypto are quite a bit simpler than those governing steock sales. No wash rule, to begin with.

Anybody who's ever invested in anything ought to be familiar with the idea that if you sell something for more than you bought it for you will pay tax on the difference...

I was given the impression that a lot of Bitcoin investors weren't experienced investors and didn't really understand tax laws when it came to such investments. I would imagine the bigger investors knew what was going on. Crypto has been extremely volatile since it's creation, unlike the dollar which fluctuates very little compared to crypto.
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
My understanding is that the reason for today's crypto crash is due to people finding out that they have to pay federal taxes on the money once they use it. So, that 40K that was made on the 10 dollar purchase would be taxed as soon as it was spent. At least that's what CNBC is giving as an explanation for the crash. Apparently, a lot of people didn't understand how complicated the tax laws are in regards to crypto. It's like buying a stock. You pay the tax once you sell the stock, assuming you made money on it. You only pay the capital gains rate if you held it for over a year, otherwise it's taxed the same an other income. OF course, that's just US tax rules. I have no idea how this works in other countries.

True, but I was given the impression that some of the Bitcoin investors weren't very sophisticated when it comes to investing. Or maybe they simply weren't thinking since crypto is imo, a rather weird and risky investment. Then again, so are stocks when you really think about it.

I don't know why it's crashing (it had no business inflating in the first place), but the tax laws regarding crypto are quite a bit simpler than those governing steock sales. No wash rule, to begin with.

Anybody who's ever invested in anything ought to be familiar with the idea that if you sell something for more than you bought it for you will pay tax on the difference...

I was given the impression that a lot of Bitcoin investors weren't experienced investors and didn't really understand tax laws when it came to such investments. I would imagine the bigger investors knew what was going on. Crypto has been extremely volatile since it's creation, unlike the dollar which fluctuates very little compared to crypto.
Funds like GBTC and ETHE can get one exposure to Bitcoin and Ethereum without the fuss, and if in an IRA, without the taxman...whether or not the mishmash of cryptocoins are heading for a long term downfall or not...is another thingy I'd hate to try and predict.
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
Only people I know on Crypto are idiots and drug dealers/buyers.
I'd expect that there is also quite a bit of interest from people in autocratic countries that want an escape hatch that their government would have a hard time steeling; never mind countries like Venezuela, Lebanon, Iran, and a third of Africa with high inflation rates, and not wanting to stuff 20 dollar US bills in their mattress...
 

TomC

Celestial Highness
Staff member
Joined
Oct 1, 2020
Messages
4,024
Location
Midwestern USA
Gender
Faggot
Basic Beliefs
Agnostic deist
Only people I know on Crypto are idiots and drug dealers/buyers.
I'd expect that there is also quite a bit of interest from people in autocratic countries that want an escape hatch that their government would have a hard time steeling; never mind countries like Venezuela, Lebanon, Iran, and a third of Africa with high inflation rates, and not wanting to stuff 20 dollar US bills in their mattress...

There's another interesting question about cryptocurrency.

If you buy with rubals or euros or something, and the dollar value goes down while the other currencies rise, then what?

Tom
 

RVonse

Veteran Member
Joined
Jul 2, 2005
Messages
2,243
Location
USA
Basic Beliefs
that people in the US are living in the matrx
Some will argue that Bitcoins have a "real value" related to their mining cost, which — if I haven't erred — is about the same as Bitcoin's current market price! However the huge sums spent on computation have not created anything with intrinsic worth. Just the opposite: bit-mining is deliberate "busy work." Wasteful computations are a deliberate feature of the "clever" blockchain design.

The electricity wasted on Bitcoin mining ($18 Billion worth in the most recent 12 months) will seem shameful when we recall that humanity wants to reduce power usage to cut CO2 emissions. I think this problem is what Elon Musk reacted to.
AFAIK, Bitcoin has NEVER been hacked. Ever. And no other cryptocurrency can make that claim. An easily transported safe store of wealth with no counterpart interest that can not be hacked or stolen is the value added that bitcoin advertises.

So there is real value more than just data bits on the computer screen I'm just not sure there is really $50000 worth of value.
 

TV and credit cards

Veteran Member
Joined
Nov 17, 2013
Messages
4,344
Location
muh-dahy-nuh
Basic Beliefs
Humanist
I never got why gold has value other than it’s shiny so people like it. It has no utility. Bitcoin, near as I can figure has no utility either. I tried to find why some of the others might have value based on some utility and end up reading about their blockchain. The blockchain looks to have some utility, like Ethereum but the coin associated with it? I can’t make the connection. Ripple has a coin that has a definable utility but other than that, I don’t know. I haven’t read them all and have no intention of doing so. I suppose I’m just missing the connection between blockchain and it’s associated coin.
 

Swammerdami

Squadron Leader
Staff member
Joined
Dec 16, 2017
Messages
2,509
Location
Land of Smiles
Basic Beliefs
pseudo-deism
I never got why gold has value other than it’s shiny so people like it. It has no utility. Bitcoin, near as I can figure has no utility either.

It's an exaggeration to say gold has no value. For example, a typical smartphone contains almost $2 worth of gold. (Engineers count pennies, and would be delighted to cut the manufacturing cost of a phone by 5¢.) Samsung and Apple don't add gold to their phones for decoration! If a cheaper metal satisfied their needs they'd use it. If the price of gold fell dramatically, there would be a lot more applications where gold was the cost-effective ingredient.

We may agree that some of gold's high price is due to a particular monetization of scarcity. The same is true of Bitcoin. A difference is that a Bitcoin Version 2 may show up to sop up another $1 Trillion of wealth; then a Bitcoin Version 3 and so on. Gold's scarcity, however, is likely to be permanent.
 

Patooka

Veteran Member
Joined
Apr 5, 2004
Messages
4,619
Location
Sydney
Basic Beliefs
aaa
I'm pretty certain cryptocurrency has always been this erratic. Proclaiming its death merely one week after a single SNL skit is a tad premature.
 

Elixir

Made in America
Joined
Sep 23, 2012
Messages
20,068
Location
Mountains
Basic Beliefs
English is complicated
I never got why gold has value other than it’s shiny so people like it. It has no utility.

Art has no utility, but has been a good investment for a long time. In fact, the primary guasi-utilitarian value of gold is that it is easily worked into art objects and it's appearance is durable (unlike that of silver which has far more inherent "practical" value.)
I'd say bitcoin actually has negative utility, considering the billions in "wasted" energy. It might be argued that it's an entertainment medium for its "players' and that as such it has some value... whether or not it offsets the energy/environmental cost, is another question.
 

bilby

Fair dinkum thinkum
Joined
Mar 7, 2007
Messages
26,789
Location
The Sunshine State: The one with Crocs, not Gators
Gender
He/Him
Basic Beliefs
Strong Atheist
I never got why gold has value other than it’s shiny so people like it. It has no utility.

Art has no utility, but has been a good investment for a long time. In fact, the primary guasi-utilitarian value of gold is that it is easily worked into art objects and it's appearance is durable (unlike that of silver which has far more inherent "practical" value.)
I'd say bitcoin actually has negative utility, considering the billions in "wasted" energy. It might be argued that it's an entertainment medium for its "players' and that as such it has some value... whether or not it offsets the energy/environmental cost, is another question.

Of course art has utility.

Gold, on the other hand, has very little. It can be turned into jewellery; But that's not just gold anymore. Investing in bullion because gold can be made into jewellery is like investing in paint because paint can be turned into works of art.

Bullion just sitting in a vault isn't useful for anything.
 

bilby

Fair dinkum thinkum
Joined
Mar 7, 2007
Messages
26,789
Location
The Sunshine State: The one with Crocs, not Gators
Gender
He/Him
Basic Beliefs
Strong Atheist
All money has purely imagined value; what makes it real is its acceptance by social convention and powerful economic institutions, not any inherent property of the medium. What Cryptocurrency has crucially failed to do is gain acceptance as anything other than the identity marker of a certain very narrow societal subgrouping, a demographic slice that is wealthy but largely inconsequential to the basic economic processes that move the world along.

Of course, but the dollar is backed by the US government. As long as there is trust in the government, the dollar has value. What exactly backs Bitcoin? Everything humans make up are based on myths.

The dollar is valuable not because of US government backing, but because the US government requires that you use dollars to pay your taxes, and won't let you pay in anything else (and certainly won't let you not pay at all).
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
I'd say bitcoin actually has negative utility, considering the billions in "wasted" energy. It might be argued that it's an entertainment medium for its "players' and that as such it has some value... whether or not it offsets the energy/environmental cost, is another question.
Vegas? :D
 

Artemus

Veteran Member
Joined
Nov 24, 2002
Messages
1,111
Location
Bible Belt, USA
Basic Beliefs
Atheist and general cynic
I never got why gold has value other than it’s shiny so people like it. It has no utility. Bitcoin, near as I can figure has no utility either. I tried to find why some of the others might have value based on some utility and end up reading about their blockchain. The blockchain looks to have some utility, like Ethereum but the coin associated with it? I can’t make the connection. Ripple has a coin that has a definable utility but other than that, I don’t know. I haven’t read them all and have no intention of doing so. I suppose I’m just missing the connection between blockchain and it’s associated coin.

Gold was in many respects the first fiat currency. A government decided that a worker's time was worth so many grains of gold, and prices were set relative to that. (A soldier's pay is often given as the example, but I don't know if that is correct.) It worked well at the time: it was durable, easily recognized, easily carried, easily transferred, easily divided into smaller parts, and difficult to counterfeit. The problem was that the supply was controlled by how much you could dig out of the ground or steal from conquered lands. A country that doubled the size of its economy would need twice as much gold, or suffer crippling deflation. Huge finds, on the other hand, would be inflationary. The current fiat currencies are equal to or better than gold in all respects, provided that the issuing government is responsible. But until societies reached that point gold was the best we had.

Bitcoin, however, is useless as a currency. It is inherently deflationary with its limited supply, is not easily transferred (ten minutes and a huge amount of energy with a transaction fee to transfer *any* amount), is not easily recognized, and is not durable (I forgot my password/reformatted the disk drive/dropped the flash drive in the lake and ALL my money is gone!). I really don't understand the hype.
 

Gospel

Warning Level 9999
Joined
Oct 22, 2007
Messages
2,904
Location
Florida
Gender
Masculine
Basic Beliefs
Agnostic
I made 250k off bitcoin so I'm biased.
 

Gospel

Warning Level 9999
Joined
Oct 22, 2007
Messages
2,904
Location
Florida
Gender
Masculine
Basic Beliefs
Agnostic
I made 250k off bitcoin so I'm biased.

That implies bitcoin can only have value whilst it is dependent on other currencies.

To me, it was just being lucky for being born in 1973 and group mining sometime afterward then holding (in my case discovering) until Elon Musk became a thing. My only regret is that I had to convert to a non us currency first (long story).
 

funinspace

Don't Panic
Joined
Mar 1, 2004
Messages
4,194
Location
Oregon
Gender
Alien
Basic Beliefs
functional atheist; theoretical agnostic
Though slipping more off topic...
All money has purely imagined value; what makes it real is its acceptance by social convention and powerful economic institutions, not any inherent property of the medium. What Cryptocurrency has crucially failed to do is gain acceptance as anything other than the identity marker of a certain very narrow societal subgrouping, a demographic slice that is wealthy but largely inconsequential to the basic economic processes that move the world along.

Of course, but the dollar is backed by the US government. As long as there is trust in the government, the dollar has value. What exactly backs Bitcoin? Everything humans make up are based on myths.

The dollar is valuable not because of US government backing, but because the US government requires that you use dollars to pay your taxes, and won't let you pay in anything else (and certainly won't let you not pay at all).
It seems to me that it must be more complicated than just the fact that the US government requires Americans to pay taxes in dollars. I expect that Turkey (one modern example) requires its people to pay in their Lira as well. Yet, their currency relative to the US dollar and the value of imports, has not done that well.

https://en.wikipedia.org/wiki/Turkish_lira
After periods of the lira pegged to the British pound and the French franc, a peg of 2.8 Turkish lira = 1 U.S. dollar was adopted in 1946 and maintained until 1960, when the currency was devalued to 9 Turkish lira = 1 dollar. From 1970, a series of hard, then soft pegs to the dollar operated as the value of the Turkish lira began to fall.

The following are based on yearly averages:

1960s – 1 U.S. dollar = 9 Turkish lira
1970 – 1 U.S. dollar = 11.3 Turkish lira
1975 – 1 U.S. dollar = 14.4 Turkish lira
1980 – 1 U.S. dollar = 80 Turkish lira
1985 – 1 U.S. dollar = 500 Turkish lira
1990 – 1 U.S. dollar = 2,500 Turkish lira
1995 – 1 U.S. dollar = 43,000 Turkish lira
2000 – 1 U.S. dollar = 620,000 Turkish lira
2001 - 1 U.S. dollar = 1,250,000 Turkish lira
2005 – 1 U.S. dollar = 1,350,000 Turkish lira
<snip>
In December 2003, the Grand National Assembly of Turkey passed a law that allowed for redenomination by the removal of six zeros from the Turkish lira, and the creation of a new currency.
Since the 2003 reset, the Lira has again fallen from about 1.3/1 to 9.x/1 today.
 

Jarhyn

Wizard
Joined
Mar 29, 2010
Messages
9,052
Gender
No pls.
Basic Beliefs
Natural Philosophy, Game Theoretic Ethicist
So Colonial Pipeline paid ransom, at least bitcoins are useful for that :D
Maybe we should call it RansomCoin.

I keep pointing out that in both in frequency AND volume of transaction, the aggregate "illegal" uses of Bitcoin far outstrip legal non-speculative applications. More, I would call it "crimebux".
 

TSwizzle

Let's go Brandon!
Joined
Jan 8, 2015
Messages
6,383
Location
West Hollywood
Gender
Male
Basic Beliefs
Atheist
I never got why gold has value other than it’s shiny so people like it.

I think gold was widely used in electronics back in the day. I don't know if gold is still used significantly that way. I remember years ago a company I worked for was getting rid of a Honeywell mainframe which was huge and the scrap guy told me he was taking the circuit boards to get at the gold.
 

ZiprHead

Loony Running The Asylum
Staff member
Joined
Oct 23, 2002
Messages
29,819
Location
Frozen in Michigan
Gender
Old Fart
Basic Beliefs
Democratic Socialist Atheist
I never got why gold has value other than it’s shiny so people like it.

I think gold was widely used in electronics back in the day. I don't know if gold is still used significantly that way. I remember years ago a company I worked for was getting rid of a Honeywell mainframe which was huge and the scrap guy told me he was taking the circuit boards to get at the gold.

Yup, gold is an excellent electricity conductor. High end sound equipment uses gold plated rca connectors. Frankly, I think plating over the steel does little to nothing because the current still has to go through far more steel than gold. It's like the myth of the high end Monster cables.
 

bilby

Fair dinkum thinkum
Joined
Mar 7, 2007
Messages
26,789
Location
The Sunshine State: The one with Crocs, not Gators
Gender
He/Him
Basic Beliefs
Strong Atheist
Though slipping more off topic...
The dollar is valuable not because of US government backing, but because the US government requires that you use dollars to pay your taxes, and won't let you pay in anything else (and certainly won't let you not pay at all).
It seems to me that it must be more complicated than just the fact that the US government requires Americans to pay taxes in dollars. I expect that Turkey (one modern example) requires its people to pay in their Lira as well. Yet, their currency relative to the US dollar and the value of imports, has not done that well.

https://en.wikipedia.org/wiki/Turkish_lira
After periods of the lira pegged to the British pound and the French franc, a peg of 2.8 Turkish lira = 1 U.S. dollar was adopted in 1946 and maintained until 1960, when the currency was devalued to 9 Turkish lira = 1 dollar. From 1970, a series of hard, then soft pegs to the dollar operated as the value of the Turkish lira began to fall.

The following are based on yearly averages:

1960s – 1 U.S. dollar = 9 Turkish lira
1970 – 1 U.S. dollar = 11.3 Turkish lira
1975 – 1 U.S. dollar = 14.4 Turkish lira
1980 – 1 U.S. dollar = 80 Turkish lira
1985 – 1 U.S. dollar = 500 Turkish lira
1990 – 1 U.S. dollar = 2,500 Turkish lira
1995 – 1 U.S. dollar = 43,000 Turkish lira
2000 – 1 U.S. dollar = 620,000 Turkish lira
2001 - 1 U.S. dollar = 1,250,000 Turkish lira
2005 – 1 U.S. dollar = 1,350,000 Turkish lira
<snip>
In December 2003, the Grand National Assembly of Turkey passed a law that allowed for redenomination by the removal of six zeros from the Turkish lira, and the creation of a new currency.
Since the 2003 reset, the Lira has again fallen from about 1.3/1 to 9.x/1 today.

When taxes are insufficient to mop up the excess cash created by government spending, the result is inflation. The Turkish government needs to tax more, or spend less, or get their economy to grow fast enough to soak up the extra Lira that they're generating.

It seriously doesn't help that a lot of the cash Turkey creates is spent unproductively - on military hardware imported from other countries, which does nothing to grow the Turkish economy. So they're creating lots of cash that just reduces the value of the existing cash. If they instead spent it on infrastructure that helped Turkish people become more productive, then the Lira wouldn't inflate so badly.

Spending that money on infrastructure would be a much less inflationary way to go; Or developing their own advanced weapons industries, so the value stays in their economy, rather than being handed to foreigners.

The USA has the opposite situation. Foreigners need US$ so they can buy stuff that only America (and a handful of other nations) has for sale. Boeing and Lockheed, and their US employees, can't pay their taxes in Turkish Lira.

And, of course, the Turkish economy is much smaller that the US economy, so there's less inertia - small influences have bigger effects in a smaller economy.
 

bilby

Fair dinkum thinkum
Joined
Mar 7, 2007
Messages
26,789
Location
The Sunshine State: The one with Crocs, not Gators
Gender
He/Him
Basic Beliefs
Strong Atheist
I never got why gold has value other than it’s shiny so people like it.

I think gold was widely used in electronics back in the day. I don't know if gold is still used significantly that way. I remember years ago a company I worked for was getting rid of a Honeywell mainframe which was huge and the scrap guy told me he was taking the circuit boards to get at the gold.

Yup, gold is an excellent electricity conductor. High end sound equipment uses gold plated rca connectors. Frankly, I think plating over the steel does little to nothing because the current still has to go through far more steel than gold. It's like the myth of the high end Monster cables.

Electrical connectors and optical coatings are both trivial uses of gold, compared to jewellery; And vastly more refined gold is sitting in storage than is used for all of these applications combined.
 

barbos

Contributor
Joined
Nov 12, 2005
Messages
14,035
Location
Mlky Way galaxy
Basic Beliefs
atheist
I never got why gold has value other than it’s shiny so people like it.

I think gold was widely used in electronics back in the day. I don't know if gold is still used significantly that way. I remember years ago a company I worked for was getting rid of a Honeywell mainframe which was huge and the scrap guy told me he was taking the circuit boards to get at the gold.

Yup, gold is an excellent electricity conductor. High end sound equipment uses gold plated rca connectors. Frankly, I think plating over the steel does little to nothing because the current still has to go through far more steel than gold. It's like the myth of the high end Monster cables.
gold is used in electronics because its chemically inert and does not react much with anything.
 

Artemus

Veteran Member
Joined
Nov 24, 2002
Messages
1,111
Location
Bible Belt, USA
Basic Beliefs
Atheist and general cynic
I never got why gold has value other than it’s shiny so people like it.

I think gold was widely used in electronics back in the day. I don't know if gold is still used significantly that way. I remember years ago a company I worked for was getting rid of a Honeywell mainframe which was huge and the scrap guy told me he was taking the circuit boards to get at the gold.

Yup, gold is an excellent electricity conductor. High end sound equipment uses gold plated rca connectors. Frankly, I think plating over the steel does little to nothing because the current still has to go through far more steel than gold. It's like the myth of the high end Monster cables.

Copper is actually a better conductor than gold. (Silver is best.) The advantage of gold plating on connectors is that is does not oxidize. Back in the day I "fixed" a number of stereos by rotating the RCA plugs on the sockets to scrape off the corrosion that had built up.

The suggestion that the material a speaker wire (or its insulation) of sufficiently low resistance is made of affects the sound is one of the more ridiculous claims by the "high-end" audio charlatans. ($10,000 for a 2 m power cord is slightly more ludicrous, but only slightly.)
 

ZiprHead

Loony Running The Asylum
Staff member
Joined
Oct 23, 2002
Messages
29,819
Location
Frozen in Michigan
Gender
Old Fart
Basic Beliefs
Democratic Socialist Atheist
Yup, gold is an excellent electricity conductor. High end sound equipment uses gold plated rca connectors. Frankly, I think plating over the steel does little to nothing because the current still has to go through far more steel than gold. It's like the myth of the high end Monster cables.

Copper is actually a better conductor than gold. (Silver is best.) The advantage of gold plating on connectors is that is does not oxidize. Back in the day I "fixed" a number of stereos by rotating the RCA plugs on the sockets to scrape off the corrosion that had built up.

The suggestion that the material a speaker wire (or its insulation) of sufficiently low resistance is made of affects the sound is one of the more ridiculous claims by the "high-end" audio charlatans. ($10,000 for a 2 m power cord is slightly more ludicrous, but only slightly.)

Copper prices are going through the roof. Was just going to buy a 25 ft 10/3 + ground to wire the upstairs laundry. 85 bucks. Hoping my BiL, the electrician, can get me some.
 
Top Bottom