Welcome to NexusFi: the best trading community on the planet, with over 150,000 members Sign Up Now for Free
Genuine reviews from real traders, not fake reviews from stealth vendors
Quality education from leading professional traders
We are a friendly, helpful, and positive community
We do not tolerate rude behavior, trolling, or vendors advertising in posts
We are here to help, just let us know what you need
You'll need to register in order to view the content of the threads and start contributing to our community. It's free for basic access, or support us by becoming an Elite Member -- see if you qualify for a discount below.
-- Big Mike, Site Administrator
(If you already have an account, login at the top of the page)
The US Dollar is (very) widely circulated and accepted. It fulfils its purpose as a currency. BTC does not. Not only that, but it CAN'T fulfill that role either. Right now it's too volatile and in the future it will be in a permanent deflationary deathspiral due to fundamental flaws in its structure.
I mean, if people are making money off it, good for them, I just like to impart the danger of what they're throwing their money at. Basically tulip bulbs. But at least those eventually became flowers (maybe).
It is Mandlebrot's set. His theory, believed by some and not by others is that markets move like other natural phenomena which is to say "roughly".
The set he created is a picture of that process, not so much a picture but an artist's rendition. You can concoct trade plans based on this kind of market picture yes. The book he wrote about it is called
download
xFMxyV3
Coming, they can't be denied. Going, they can't be detained.
Sure. BTC is capped at 21 million. Once that many have been mined the supply is exhausted. However, its designed to have increasing difficulty to mine each additional block. There's already about ~18 million mined, and at current rate it's not going to hit 21 million until the year 2140. BTC advocates count this as an advantage, but it's not how currency actually works. Unless the population growth rate dips below the BTC creation rate, BTC's supply will continue to dwindle relative to the user base. Add to that even further problems of people just flat out losing the key to their wallets and that money stays in a permanent lockbox and can't ever be redistributed nor re-introduced.
Weirdly, BTC investors think this deflation is a feature. If your interests are purely speculative, it kind of is. Sure, BTC will continue to rise in value denominated in dollars due to this phenomenon, until it simply "breaks." But, alongside its current volatility, it ensures that BTC cannot ever really achieve its basic mission of existence as a currency. Another interesting thing to watch with BTC is throughout history, we've seen plenty of currencies collapse due to inflation. This may be the first major uncontrollable deflationary event.
Don't forget about the regular splittings that make it always difficult to reach the final cap.
So btc may be on a very long road and may develop extreme high price levels.
Exactly. If people ever actually transacted in BTC, they'd have to use scientific notation.
Another thing to consider about how fundamentally flawed BTC is designed: it only goes out to 8 decimal places. So if it hits a pricepoint, of say, $100,000/ 1 BTC the smallest possible transaction is $0.001. That seems ok on the surface but for larger level financial operations that's not NEARLY small enough.
Interesting argument. But the network adjusts the difficulty up OR down to make the block time consistent. And the losing keys issue will only continue if institutional adoption does not happen. Several banks have already announced that they will soon custody crypto and others may or may not follow. If they do, it seems likely that individuals will use banks to custody their crypto instead of facing the complexity of self-custody which will likely eliminate loss of keys. In addition, with the inevitable release of a CBDC by the Fed as the US goes cashless, users will become more accustomed (and apps will become more plug-n-play) to using digital assets. Also, I'm not sure I understand why a reduction in supply per user is a negative and why it would just "break" at some critical level (unless it does so because of a division by zero error since we're talking about USD being the denominator). The assumption implicit in your argument is that Bitcoin will break before USD does, which isn't a bet I think I would take. Just look at a chart of M1 Money Stock and tell me the future of USD is a long and healthy one.
No, people will just start referencing "sats" instead of BTC. And you're assuming that BTC will always be priced in terms of $. At some point, it may be priced only in terms of itself. We don't walk around referring to how many dollars we have in terms of troy oz of gold or silver even though people used to transact in those.
There's always a huge amount of hopeful caveats involved with BTC that are necessary to make it function even on a basic level.
The problem with a currency constantly increasing in value is our entire monetary system works towards slight inflation. For example, if you take out a loan on a house in BTC and BTC is always increasing in value, every month your payment becomes MORE onerous. It creates a disincentive to borrow or purchase. That mentality would permeate the entire economy. Deflation leads to depressions.
Even further, I agree that the US government's custody of the USD is absolutely awful, but that points out something that makes BTC even less viable as a currency. At least the USD has the ability for intervention, how ever bad that intervention may be. BTC will just do what it does, no matter how absolutely insane or impractical it becomes.
I don't think the USD is the epitome of currency in any way, but BTC clearly was designed by a tech guy with a pretty good rough-draft idea which requires all sorts of improvements to make it even basically usable.